Microsoft to invest in bleeding-edge start-ups with new funds

Microsoft Ventures to help cloudy start-ups get a leg-up in the industry

Microsoft is looking to pour cash into early-stage cloud start-ups with its new Microsoft Ventures investment fund.

Microsoft Ventures used to refer to a team within its Developer Evangelism team, but is now the name of its new investment fund aimed at funding "bleeding-edge" start-ups. The other team will be rebranded as Microsoft Accelerator, which focuses on start-up enablement, while Microsoft Ventures will take care of the financial investments.

"Given that the move to the cloud remains the single largest priority for the industry, identifying the bleeding-edge companies who complement and leverage the transition to the cloud is key to our investment thesis," Microsoft's corporate vice president for Microsoft Ventures Nagrai Kashyap said.

Kashyap added that Microsoft Ventures will fund companies which support not only its own company objectives, but those of its customers and partners too.

Microsoft has always supported start-ups with investments, it claims, but admitted that the funds have rarely gone to those in the early stages of business. But that will change now it has a "formalised venture fund".

"There are often questions around corporate venture programmes versus venture capital firms, and whether or not they are at odds or create disadvantages for entrepreneurs," Kashyap said.

"In our case, we are driven by the desire to help early-stage companies take advantage of Microsoft's financial, technical and go-to-market resources. While we have aspirations to have global impact in new and different ways, we don't believe we need a large team to do it. In fact, we feel pretty firmly that true advancement will require the efforts of many organisations within Microsoft being smart and focused in what they do best and collectively work to help start-ups scale."

To begin with, Microsoft Ventures will have a presence in the San Francisco area, Seattle, New York City and Tel Aviv, but it will spread to other areas in the coming years.