Will Google's startup incubator prompt talented staff to stay?

The space, called 'Area 120,' reportedly will allow Google employees to pursue their startup ideas full time, with the full support of the company. 

Stephen Lam/Reuters/File
The Google logo at Google headquarters in Mountain View, California. The company's Paris office was raided last week as part of a tax fraud probe.

Google wants to keep its brightest minds in-house.

According to a report from tech publication The Information picked up by Fortune, Wired, Quartz, and others, Google intends to launch ‘Area 120,’ a startup incubator led by Google executives Don Harrison and Bradley Horowitz. ‘Area 120’ will allow employees to pursue their startup ideas full time without losing out on support from Google or their employee benefits, according to The Information.

In order to participate, Google will submit a business plan and, if accepted, pursue it several months. If the project is successful, they will be able to pitch Google for more funding to create a new company.

Google already lets its employees devote a fifth of their work time to personal projects. Dubbed “20% time,” it’s an idea that founders Larry Page and Sergey Brin outlined in their 2004 IPO letter as vital to the company’s management philosophy.

“We encourage our employees, in addition to their regular projects, to spend 20% of their time working on what they think will most benefit Google,” they wrote. “This empowers them to be more creative and innovative.”

Some projects that were developed during 20 percent time, including Google News, AdSense, and even Gmail, have gone on to flourish as full Google products. Yet Google has also faced the risk that any project an employee takes on in their spare time will go on to become an independent product or company outside of Google.

A Google employee created Instagram after they left the company. Instagram was acquired by Facebook for $1 billion in 2012, a move widely seen as a protection against Instagram being acquired first by Google or Twitter.

Alphabet, which collectively houses both Google and many of the company’s riskier side ventures, was created in 2015 with the goal of “[e]mpowering great entrepreneurs and companies to flourish.” This may be an implicit acknowledgement that not every idea born at Google wants to stay there, but they still want to draw as many innovations as possible.

Like other tech companies, Google has found attracting top talent and keeping institutional wisdom within the firm a challenge in recent years. According to 2013 data from Payscale, the median tenure at Google is just about a year. Overall, tech has some of the highest employee turnover of any industry, according to Payscale.

A wave of top-level employees has left Google in recent years. In early April of this year, Facebook hired Regina Dugan away from her role as head of the Advanced Technologies and Projects (ATAP) Group at Google. She will soon be leading Building 8 at Facebook, which is invested in pursuing projects related to Facebook’s mission of global connectivity. In 2015, Rachel Whetstone, formerly head of communications and public policy at Google, left to take on a similar role at Uber. In 2014, Tom Fallows left Google’s fledgling Google Express delivery service to work at Uber.

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