When we launched Microsoft Ventures last year, we decided that our primary customer was the entrepreneur. Our goal was to make strategic bets on innovators around the globe with creative ideas for harnessing disruptive technology trends.
As our leader Nagraj Kashyap says, our mission is to be the most sought-after financial partner for startups that are driving digital transformation. Even before we launched, we thought about how we could best serve entrepreneurs.
That emphasis shaped how we defined our investment focus, how we entered the marketplace, and how we built our venture team. Most importantly, it shaped how we work with entrepreneurs from the moment we first meet them.
Collaboration Begins on Day One
Right from the first pitch meeting, we want to start collaborating with entrepreneurs. We treat the people sitting across the table from us like customers. If founders feel we grok their business and their technology from the start, they’ll trust us, and they’ll choose to partner with Microsoft Ventures because we’ll know how to apply Microsoft’s vast resources for scaling in B2B markets to their company.
Establishing that early rapport between an investor and founder is everything, so it’s important for our team to be credible and multifaceted. We never want an entrepreneur to be the only engineer in the room, the only developer, marketer or finance professional. By representing a variety of professional backgrounds and viewpoints, we’re able to connect with startup founders of all stripes.
One of our proudest achievements in the first year of Microsoft Ventures was establishing a team with depth and breadth of sector experience, which also showcases the strengths of diversity and inclusion. We set out to bring together the most talented, forward-thinking venture investors and business development professionals—and we did.
Credibility Across Many Fields
You can see this sensibility reflected in every one of our team members: Many of us have venture backgrounds, with experience investing in SaaS, cloud infrastructure, big data and analytics, cybersecurity, artificial intelligence, and other emerging technologies. But it was also important we hire team members with diverse functional experience on the startup side.
Case in point: One of our investing partners began his career at an early-stage startup that raised $110 million to build a new American car company. And on our portfolio development team, one of our senior managers was a 6th-grade math teacher before coming to Microsoft. He loves building products, and while he was a teacher, he launched a successful learning app for kids.
The portfolio development team is an example of our approach to entrepreneurs-as-customers. They open doors for entrepreneurs that we’re confident no other fund can, by leveraging all the B2B resources Microsoft has to offer across the global organization.
Key members of our portfolio development team have strong Microsoft backgrounds. They excel at connecting our portfolio companies with Microsoft’s commercial and enterprise channels, technology platforms, industry events, and global presence.
In essence, we go far beyond writing a check. We think holistically and invest with the full reach of Microsoft’s technology and go-to-market capabilities. When we invest in a startup, we map out all the ways we can tap our network along the way.
For example, CognitiveScale, an Austin-based company that provides industry-specific AI, started on a different platform but has ported their Cognitive Cloud technology to Microsoft Azure because it allows their customers to do more with machine learning. They have partnered extensively across Microsoft’s Cognitive Services, Cortana, and Blockchain offerings to deliver value to customers.
CognitiveScale was also showcased at the exclusive Microsoft CEO Summit, featured at our global customer and partner conferences, and is receiving go-to-market support from our field.
How We Think
We’ve found that the diversity of thought on our team serves our portfolio companies well. We want entrepreneurs to feel confident that we get their big idea, and are excited to join on their journey.
In addition to our go-to-market resources, our different backgrounds make Microsoft Ventures unique. One of our partners led global business development for startups Couchbase and BlueData. With her engineering background and deep understanding of cloud infrastructure, she helps us evaluate startups’ technology and helps our entrepreneurs grow their businesses.
And one our principals has a strong finance background. She was a deal lead at Square, and worked on several acquisitions in the mobile payments, SMB, SaaS, AI, and machine learning spaces. Because of her domain expertise and metrics-driven approach, she helps our startup founders and us understand the challenges SMBs face in scaling.
Another of our principals brings an international perspective from a technology leader. He was a senior software engineer at EMC in Israel, where he led a team that helped bring the company’s first flash storage products to a global market and integrated several strategic acquisitions into EMC’s offerings. Today, he helps our portfolio companies think strategically about their product portfolio and potential fit with global leaders.
We have team members in five cities around the world, but at the end of the day, we are one team.
Relationships Based on Trust
Ultimately, I’m proud of our team’s great UI. The way we’ve structured our team, how we think, and how we regard and respect entrepreneurs all build trust with our startup founders. In pitch after pitch, I’ve seen that mutual connection established right away. We dive right in with a spirit of partnership, and that’s why so many founders and co-investors choose to work with us.
Credibility and personal trust help investors win a deal, but they also carry investors through a long-term relationship with a startup’s leadership team. It’s important to optimize the relationship, not the valuation. Great companies take years to build. I’ve had experience with Series A investments that took more than 10 years to achieve their potential.
When an entrepreneur trusts you, they come to you not only with their success but also their challenges. You want to be their first call. At Microsoft Ventures, we solve problems together. From true collaboration comes exciting, even groundbreaking, solutions.