Strategic investing – what makes a great corporate investor?

By Rob Salvagno, Cisco Vice President

There is plenty of capital out there for tech entrepreneurs – from crowd sourcing to the VC that has just closed its latest mega fund. Corporate investors haven’t stood on the sidelines either and the number of corporates announcing new funds also appears to be nearing a crescendo. The approach for each strategic investor varies greatly – with some strategics investing strictly based on their businesses today and others with little to no tie to the current businesses of their corporate parent. As an entrepreneur only you can decide whether and when taking money from a strategic is right for your company.

So what makes a great strategic investor?
– a shared vision to build something great for customers
– relationships with key business executives and technical leaders
– direct access to customers and go to market channels
– opportunities to secure lighthouse customers

Cisco has been a strategic investor for as long as we have been an acquirer. Historically these investments were focused in Cisco’s core businesses. More recently we have extended this scope to allow Cisco to invest in next horizon market opportunities that look beyond where our businesses are focused today. As we expand our investment activity, we are building a platform to expose the value of Cisco to our portfolio companies.

Our mission is simple – to be the best strategic investor in IT.

So, getting back to what makes a great strategic investor, let’s talk about what Cisco brings to the table:
– 40 corporate development professionals worldwide
– Cisco IT, a Fortune 100 buying center
– the best customer base of any IT company across Enterprise, Commercial, Service Provider and Public Sector
– 25,000 sales and marketing professionals, thousands of channel partners
– leadership across a broad spectrum of IT – networking (routing, switching, mobility), data center/virtualization/cloud, security, collaboration, video and services

Cisco Investments is exposing our portfolio companies to these great resources through things such as:
– providing direct access to business unit leaders
– Cisco IT days offering exposure to our CIO and senior IT staff
– participation in major Cisco customer, partner and channel events such as Cisco Live – the largest gathering of Cisco customers, experts and partners worldwide
– intimate dinners with our CEO and other senior leaders, providing mentorship opportunities for our portfolio company CEOs and those of our venture capital partners

We will focus our investment activity around Cisco’s core businesses as well as next horizon opportunities that align with our investment themes. Themes today include IoT, Storage, Big Data and Analytics, Connected Mobility, Silicon, Content Technology and India Innovation. We will expand and add to these themes as dictated by the rapid pace of innovation we see in the markets we follow.

We will invest at all stages of a company and prefer to work in conjunction with our VC partners. We have written checks for as little as $500K and as large as $150M, though our average investment is $3-5M initially.

What do you look for in a strategic investor? If you have a great idea or company and share our vision for changing the way we work, live, play and learn, we would love to hear from you.