The charitable arm of Internet search engine company Google, Google.org, has announced it will spend up to $175 million in its first round of grants and investments over the next three years. The charitable organization has about $2 billion set aside in assets.

"We are trying to rely on things related to Google's core competency, where we can really make a difference," says Sheryl Sandberg, a Google vice president and founding board member of Google.org.

"We wanted ideas where we could say, 'If we get this right, it will change the world.'"

The guys over at Google.org are actually experimenting with a hybrid for-profit/nonprofit model. Google announced four years ago it was devoting 1% of its equity, 1% of profits annually and an unspecified amount of employee time to Google.org. To fund the organization, Google granted them 3 million shares during their IPO, which now amounts to some $2 billion.

The director as of 2007 is Dr. Larry Brilliant, a medical doctor who achieved fame as one of the leaders of the successful World Health Organization smallpox eradication program.

The first grants, which amount to approximately $25 million, include five million dollars to an organization called InSTEDD (for Innovative Support to Emergencies, Diseases and Disasters); $2 million to a nongovernmental organization in India called Pratham, which conducts large-scale assessments on the delivery and quality of education to the poor; $2.5 million will be awarded to the Global Health and Security Initiative (GHSI), which focuses on responses to biological threats; and a $10 million investment in eSolar, a Pasadena, Calif., company working on thermal power from sunlight.

"Fifty percent of the gross domestic product in the developed world comes from small and medium-sized businesses, but in the developing world it's just 25%," said Sonal Shah, who came to Google after stints at Goldman Sachs, and earlier in the U.S. Treasury Department.

"We've already met with financial institutions in Kenya, Tanzania and India that want to lend but don't have the tools. We want to lower the transaction costs, find new ways of establishing credit history and create opportunities for exit rounds."