An e c USIVE OO at OW INǏ Ouse Incubator area 120 IS GROW­ING new IDEAS From GOOG ers

Fast Company - - Next Leading Edge - BY HARRY MC­CRACKEN

Google’s “20% time”—the long-stand­ing perk that in­vites em­ploy­ees to carve off a fifth of their work­ing hours to de­vote to per­sonal projects that might have value to the com­pany—is among its most iconic tra­di­tions. It’s given birth to some highly suc­cess­ful prod­ucts, from Google News to the Card­board VR head­set. But Google’s de­mand­ing day jobs, it turns out, of­ten don’t shrink to ac­com­mo­date am­bi­tious side hus­tles. There’s a sar­donic joke in­side the com­pany: 20% time is re­ally 120% time.

Twenty per­cent time may be more ethos than in­vi­o­late cor­po­rate ben­e­fit. But as

Google and its par­ent, Al­pha­bet, have swelled to 89,000 em­ploy­ees, the com­pany’s com­mit­ment to bot­tom-up in­no­va­tion re­mains a foun­da­tional value. Which led Google to ask it­self a ques­tion: What if Googlers with

big dreams could de­vote their full at­ten­tion to tack­ling them, with enough struc­ture and re­sources to max­i­mize the odds of suc­cess?

The an­swer it came up with is Area 120, a two-year-old in-house incubator whose very name slyly al­ludes to 20% time’s lim­i­ta­tions. “We built a place and a process to be able to have those folks come to us and then select what we thought were the most promis­ing teams, the most promis­ing ideas, the most promis­ing mar­kets,” ex­plains man­ag­ing di­rec­tor Alex Gaw­ley, who has spent a decade at Google and left his role as prod­uct man­ager for Google Apps (since re­named G Suite) to spear­head this new ef­fort. Em­ploy­ees “can ac­tu­ally leave their jobs and come to us to spend 100% of their time pur­su­ing some­thing that they are par­tic­u­larly pas­sion­ate about.

“There have been many, many kinds of cor­po­rate in­cu­ba­tors over the years,” Gaw­ley ac­knowl­edges. “We wanted to do some­thing with a very spe­cific Google ap­proach to it.” Area 120’s open call to Googlers for ideas aims to de­moc­ra­tize its startup-cre­ation sys­tem and in­ject it with ex­ist­ing know-how from all over Google—a far cry from in­cu­ba­tors, which get their founders ex­ter­nally and then in­ten­tion­ally wall them off from the rest of the com­pany.

So far, Google em­ploy­ees have pitched more than a thou­sand projects to Gaw­ley and his team of around 15 peo­ple, who have green-lighted around 50 of them. Staffers ac­cepted into the pro­gram per­ma­nently de­part their old jobs and work out of one of Area 120’s three of­fice lo­ca­tions—san Fran­cisco, Palo Alto, and New York City—and re­ceive enough fi­nan­cial sup­port to be­gin turn­ing their brain­chil­dren into real busi­nesses, in­clud­ing the abil­ity to staff up with re­cruits from within Google or out­side the com­pany. They run their own shows on a day-to-day ba­sis, with con­sul­ta­tion from Area 120 lead­er­ship, fel­low founders, and rel­e­vant ex­perts through­out Google. (Google doesn’t dis­close how Area 120 founders are com­pen­sated.)

These en­ter­prises aren’t about open-ended re­search. Mul­ti­ple di­vi­sions at Google and its par­ent com­pany, Al­pha­bet, are al­ready de­voted to that. In­stead, Area 120 is look­ing for con­cepts with the po­ten­tial to pass what Google co­founder Larry Page fa­mously called the tooth­brush test: things that be­come ne­ces­si­ties, not oc­ca­sional niceties. That’s how land­mark prod­ucts such as Google Search, Gmail, and Google Maps grew to bil­lion-user scale. “You want to build prod­ucts that solve prob­lems that peo­ple en­counter daily,” says Gaw­ley. Over time, the goal is to launch busi­nesses ca­pa­ble of reach­ing Google scale—and to spin them out into the most ap­pro­pri­ate groups within Google as they gain trac­tion.

None of the Area 120 projects which have be­come pub­lic to date feel like they could be­come the next Gmail, but each has its own set of high as­pi­ra­tions. Three years ago, Google prod­uct man­ager Laura Holmes, who joined the com­pany in 2009, was sit­ting in a meet­ing of the top 20 man­agers for a 500-per­son team when she no­ticed that she was the only woman in the room. “I don’t think it was in­ten­tional,” she says. “It’s just what hap­pens some­times.” Holmes pledged to find a way to help un­der­rep­re­sented peo­ple achieve suc­cess­ful ca­reers in tech­nol­ogy.

Dur­ing a three-month sab­bat­i­cal, she con­tem­plated her fu­ture and even in­ter­viewed at other tech com­pa­nies. But she con­cluded she could make a big­ger dif­fer­ence by show­ing non-tech­ni­cal adults how to code—and that Area 120 could help. Upon her re­turn, she sold the incubator’s lead­ers on her idea for Grasshop­per, a smart­phone app that teaches users Javascript pro­gram­ming through play­ful quizzes, with plenty of pos­i­tive re­in­force­ment along the way. The app went live

in April in Google’s and Ap­ple’s stores, where it’s racked up more than 20,000 rat­ings from users across both plat­forms and main­tained a five-star av­er­age.

Gaw­ley’s man­age­ment team has en­cour­aged Holmes to con­cen­trate on build­ing Grasshop­per’s au­di­ence rather than worry too much about how to turn a profit. Just a hand­ful of staffers are cur­rently ded­i­cated to the project. “It’s not like we have Google-size bud­gets to work with,” Holmes says. “We’re try­ing to be lean, try­ing to be scrappy, feel­ing that pres­sure to de­liver.”

Area 120 founders may need to scrimp, but run­ning even a tiny startup pro­vides an ed­u­ca­tion that might be tough to get any­where else at Google. Along with four fel­low Googlers, Bickey Rus­sell joined Area 120 to found Kormo, a job-hunt­ing app tai­lored to the needs of emerg­ing mar­kets, where many work op­por­tu­ni­ties are so in­for­mal and short-term that they never turn into a con­ven­tional job list­ing; it launched in Bangladesh’s cap­i­tal city of Dhaka in Septem­ber. Pre­vi­ously, Rus­sell had worked his way up to a lead­er­ship po­si­tion in Google’s sales op­er­a­tions, and though he’d al­ways con­sid­ered him­self en­tre­pre­neur­ial, he still lived within a siloed world. Once Kormo got the go-ahead, “try­ing to build a team of en­gi­neers and prod­uct man­agers and de­sign­ers was very new to me,” he says.

In some ways, Area 120 re­sem­bles a ven­ture-cap­i­tal ac­cel­er­a­tor such as Y Com­bi­na­tor—a par­al­lel its San Fran­cisco of­fice plays up with con­fer­ence rooms named af­ter ven­ture buzz­words such as “pub­lic of­fer­ing.” But the fact that it’s part of Google lets founders pig­gy­back on some of the moth­er­ship’s boun­teous ex­per­tise, such as ar­ti­fi­cial-in­tel­li­gence re­search. “It’s re­ally nice to be able to tap into all of this science,” says Ofer Ro­nen, whose Area 120 startup, Chat­base, builds tools to help com­pa­nies op­ti­mize Ai-in­fused chat­bots for pur­poses such as cus­tomer ser­vice. “On the out­side, the road map would have had to be much longer, and we’d prob­a­bly never get to these kinds of ca­pa­bil­i­ties.”

Whether the Area 120 ap­proach to in­ven­tion will pay off—and be­come some­thing other com­pa­nies might want to em­u­late—re­mains to be seen. Af­ter all, even the projects from the orig­i­nal 2016 batch are still boot­strap­ping them­selves. “You’re not mea­sured by how many mil­lions of users you have yet,” says Gaw­ley. “You’re mea­sured by how much you have learned, how many peo­ple you have been able to talk to, and how much ev­i­dence you have gath­ered that this is the right di­rec­tion or the wrong di­rec­tion.”

Then again, an­other part of the incubator’s mis­sion is to help Google ef­fi­ciently weed out ideas that are un­likely to live up to ex­pec­ta­tions. Part of that process is a check-in ev­ery six months be­tween startup founders and Gaw­ley’s team. About half of the 50 projects launched to date have shut down, while oth­ers have piv­oted away from their ini­tial vi­sion.

Among the Area 120 hatch­lings that died was prod­uct man­ager Reena Lee’s con­cept for a plat­form that would let con­sumers pro­vide feed­back to com­pa­nies by sim­ply talk­ing to a smart speaker such as Google Home. Though po­ten­tially less te­dious than con­ven­tional sur­veys, the idea had some pit­falls—among them the fact that folks who own such speak­ers are likely to be early-adopter types, which could skew their re­sponses. Six months into Lee’s ef­fort, Area 120 man­age­ment told her not to pro­ceed fur­ther. “I didn’t make the de­ci­sion,” she sighs. “I would have loved to con­tinue the op­por­tu­nity.”

Don’t feel too sad for Lee, though. She’s now one of a re­ported 100-plus Googlers at work on Fuch­sia, the com­pany’s rad­i­cal, se­cre­tive ef­fort to write a new op­er­at­ing sys­tem from scratch. The time she spent on her short-lived startup, she says, im­bued her with “a hus­tle men­tal­ity—you build and learn and it­er­ate and fig­ure things out.” If Area 120’s value to Google ends up be­ing as much about the les­sons it teaches as the prod­ucts it cre­ates, even its fail­ures may count as suc­cesses.

Area 120 FOUNDED 2016 LEAD­ER­SHIP Alex Gaw­ley, Man­ag­ing Di­rec­tor OF­FICES San Fran­cisco, Palo Alto, New York City 26 FAST­COM­PANY.COM AREA CODE Google veteran Laura Holmes had an idea to teach non-tech adults to code and is now de­vel­op­ing the con­cept through Area 120.

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