Startable – Healy Jones’ & Prasad Thammineni’s Blog

I help organize events for the New England Venture Network, and we recently met with Dan’l Lewin of Microsoft. Dan’l is a Corporate Vice President for Strategic and Emerging Business Development and is responsible for Microsoft Corp.’s global relationships with startups and venture capitalists. He had some interesting things to say…

Microsoft intends to keep a healthy startup acquisition pace

Over the past several years MSFT has acquired approximately 20 companies per year, and this strategy willlikely continue in the current environment. Dan’l reminded us, as venture capitalists, that our startups were worth something to Microsoft based on their IP and the employees who created that IP. Microsoft does not really need any help with distribution, sales people or customer lists, so he seemed to imply that his ideal time to make a purchase is when the startup has proved its validity with some customers but before it has built out its large own, internal sales team and distribution partners. It sounded like acquisitions in the sub $200 million range were much easier for MSFT division heads to complete than larger purchases, in particular if these fit neatly into that division’s stated strategic goals. Again, no change to Microsoft’s current strategy. But good to hear that they will keep buying companies in this bad economic situation.

Microsoft is trying to keep its software relevant to startups

I got the pretty clear feeling that MSFT feels serious pressure from open source. To combat this they have a cool new program called BizSpark. Basically, they are willing to give away a lot of very valuable Microsoft software to startups that are less than 3 years old and that have less than $1 million in revenue. It’s not a bad idea, as I do know that a number of developers enjoy .NET. Curious to hear people’s impressions of this program.