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Will Google Break Three-Year Dry Spell?

Google CEO Eric Schmidt told Reuters today that the worst of the recession is behind the company and he expects to start doing about one acquisition a month.

“Acquisitions are turned on again at Google and we are doing our normal maneuvers, which is small companies,” Schmidt told Reuters Television at the G20 summit.

That may be good news for VC-backed startups, which haven’t felt any love from Google since 2006, when it bought three VC-backed companies, including YouTube.

“My estimate would be one-a-month acquisitions and these are largely in lieu of hiring,” Schmidt said. “There may be larger acquisitions, but they really are unpredictable.”

In addition to more than $19 billion in cash, Google can use its stock to fund acquisitions. Its stock price has been on a tear recently, closing just under $500 today, which is near its 52-week high of $507 per share.

In all, Google has acquired just five VC-backed companies since 2003, according to Thomson Reuters (publisher of peHUB). In addition to Sequoia Capital-backed Youtube, which it acquired for $1.65 billion in October 2006, Google paid an undisclosed amount for:

  • @Last Software Inc., a maker of 3D modeling software, in March 2006. @Last had previously raised an undisclosed amount of VC from Village Ventures.
  • Applied Semantics Inc. (fka Oingo Inc.), a maker of targeted advertising software, in April 2003. Applied Semantics had previously raised $5.4 million from Zero Gravity Internet Group, Ridgestone Corp. and individuals.
  • Keyhole Inc., a maker of digital mapping software, in October 2004. Keyhole had previously raised $4.6 million from 550 Digital Media Ventures, In-Q-Tel and Intrinsic Graphics Inc.
  • Neven Vision Inc., a maker of facial recognition software to identify people in photos, in August 2006. Neven had previously raised $5 million from Anthem Venture Partners, Artisan Digital Media, Third Wave Ventures and Zone Ventures.

See Reuters story here.