Microsoft has today announced the establishment of an official venture capital division, that will invest in early-stage technology companies (Series A and above).
You might be thinking at this point – Microsoft Ventures was already a startup accelerator program under the Redmond giant’s wing, then what is it, with this new Venture program!?
Microsoft has re-branded the startup accelerator program as ‘Microsoft Accelerator‘ which will enable startups to enhance and expand, while the Venture firm will now focus squarely on investing in new technologies similar to the company’s existing products.
The Redmond-HQed tech giant has had an engaging history of working with and acquiring start-ups (like Swiftkey), but they have never been involved with the early stage development of the products. With the formalized venture firm, the company wants a piece of that pie.
Nagraj Kashyap, the Corporate VP of Microsoft Ventures says that,
When I came to Microsoft earlier this year, I was driven by the opportunity to establish a corporate venture group that would create an additional channel to engage the start-up ecosystem. It would support not just company objectives, but our customers, partners and the ecosystem more broadly.
Microsoft Venture firm will approach startups that augment and add value to the already existing technologies and products of the company, like Azure-based cloud platform, or data compression firm. It wants to function very much similar to Google Ventures, to invest and bet on budding entrepreneurs and their technologies.
The small Venture capital team wants to work hand-in-hand with the multitude of organizations within the Microsoft ecosystem to work collectively and help the funded start-ups scale. This will not only induce an advanced work culture but help them have a global impact in new and different ways.
The team is currently starting out with a presence in SanFran Bay Area, Seattle, NY City and Tel Aviv(Israel) with the plan to expand to other countries in the coming months. Since the company is planning to invest in startups to complement their technology, so we’ll see initial investments into cloud-based SaaS apps, productivity apps, machine learning and security at the same time.
Kashyap further adds that they have just starting to scout and invest in startups and there is currently no specific aim for the number of investments the firm will make annually. But they aim to maintain a steady activity over the course of the year to invest in the technologies discussed above. He further adds that you’ll soon see Microsoft Ventures pop-up as an investor in companies that complement their products and aim to disrupt how business is actually done.