The other day I had a chance to meet Claudia Fan Munce, managing director of IBM’s VC group since March 2004. Born in Taiwan and raised in Brasil, Munce is a double threat with a Master of Science in Electrical Engineering from Santa Clara University and an MBA from Stanford.
While many VC arms of corporations invest directly in startups, Munce has fashioned a totally different strategy for Big Blue. IBM does not actually invest money in companies. Rather, Munce helps IBM form strategic relationships with hundreds of startups that can help the company deliver technologies that solve customer problems. “The measurement we had was never financial return,” she says. “We take that strategic aspect and feed it back to the company.”
Since its formation in 2000, IBM has gone from working with 20 VC-backed startups to more than 1,300 today. Her group helps these young companies navigate the labyrynthian bureaucracy of Big Blue, connecting them with various business units, and offering them managerial advice and support. Munce and her team will help entrepreneurs with marketing, connect them with customers and sometimes fund joint development projects. “We invest very heavily in building these partnerships,” says Munce.
And every now and then, those relationships end up with IBM acquiring the company. Over the last few years, Munce says that IBM has scooped up 18 companies that have worked with the VC group, including Corio, Bowstreet, AlphaBlox, Trigo and most recently, AptSoft.
Currently, Munce says IBM is really focused on forging relationships with startups focused on blade servers, virtualization software and green technology. “The utility industry has always been a big customer of IBM,” says Munce. “And IBM has so many data centers around the world. The power management side is very important. Governments are asking IBM to come up with a solutiion to deliver power in a more efficient way.”
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