Rahul Sood, general manager of Microsoft Ventures, the corporate venturing arm of computing company Microsoft, outlined the work Microsoft’s accelerator fund has been doing in its premier year of operation in his keynote speech at the fourth annual Global Corporate Venturing Symposium event today.
Microsoft Ventures was established in June 2013 in a move merging several of Microsoft’s seed funding initiatives. It has 100 innovation centres across the world.
Microsoft initiated the accelerator programme in order to enhance its corporate venturing efforts, building Microsoft’s reputation as a leader in developing startup businesses. Over 200 companies have gone through the programme so far.
Sood discussed Microsoft’s activities in emerging markets as the fund looks to move outside of Silicon Valley, investing in widely in Europe and beyond. Microsoft has accelerators in London, Beijing, Paris, Berlin, Tel Aviv and Bangalore, and its accelerator has become the leader by outcomes in the latter two.
When Microsoft first launched the accelerator programme, people laughed because of the juxtaposition between its vast size and that of the tiny startups, Sood said, but the company has been working to change this perception.
At its core, Microsoft wants ideas from people who are passionate about solving local problems that can then be scaled into other markets with the assistance of its corporate partners, Sood explained. The unit is not interested in startups targeting pure cash generation, as a seed investment fund is about “helping businesses grow and connecting with customers”.
Sood stated that most Fortune 500 companies are struggling because they are facing innovator struggles. In locations such as India meanwhile, misunderstanding markets has become a major issue as the startup ecosystems in those markets are often relatively underdeveloped.
Sood said: “There are ecosystems like India where everyone is men. India is all engineers and there are no design thinkers – they think design thinking is making an app look pretty.”
To counter this, Micosoft Ventures endeavoured to link the engineer-heavy startups with designers, and all-male teams with female entrepreneurs who could broaden their outlook. There are great ideas coming out of these markets, Sood said, and Microsoft is seeking to build them into viable companies.