Might corporates be good matchmakers for startups and VCs?

Cloudflare final week introduced a $1.25 billion funding program for startups that construct on its software program, Cloudflare Staff. However this isn’t a company enterprise fund and that sum shouldn’t be firm cash.

Fairly, it’s an initiative during which the cloud infrastructure firm curates a gaggle of its startup clients and presents them to enterprise capitalists, every of which dedicated $50 million to again corporations constructing on Cloudflare Staff. The checklist of 26 enterprise funds consists of large gamers like NEA and Boldstart and smaller corporations like Pear VC. Cloudflare CEO Matthew Prince instructed me that quantity has continued to develop because the mission was introduced in September.

The rationale that is fascinating is that whereas public corporations have been drastically rising their presence in startup funding in recent times, it’s largely been by way of one among two playbooks: Corporations have been both setting apart a sleeve of capital on their steadiness sheet to again startups in adjoining or complementary sectors to their very own, or they have been launching an accelerator program.

This technique from Cloudflare feels recent. And if profitable, it may show to be a fairly good guess. This system primarily helps funnel cash to its clients, thus securing their want for the platform, whereas additionally attracting startups to think about constructing on Cloudflare over different platforms — with out Cloudflare having to spend something. It’s value noting corporations coming into this program, no matter whether or not they get pitched to VCs, do get a number of software program options for a 12 months free of charge.

However will a company like Cloudflare be matchmaker? Prince appears to assume so — he instructed me that the thought for this system got here from the corporate’s conversations with enterprise capitalists.