SAP is betting big on startups. And big data.
The business software behemoth is more than doubling its commitment to the SAP HANA Real Time Fund, going from $155 million to $405 million, to support innovation surrounding real-time applications and big data.
The SAP HANA fund launched in 2012 and primarily makes investments in early stage venture capital funds and startups building off SAP’s technology. HANA, which stands for High-Performance Analytic Appliance, is SAP’s next generation in-memory database. It can store up to 500 terabytes of data and execute at high speeds.
Big data technology is hot right now as large corporations and enterprises look for better ways to store, process, and analyze their data. SAP’s head of database and technology product marketing Amit Sinha told VentureBeat in an interview last year that “innovation in data management has stagnated” and there is a $2 trillion market opportunity for HANA and related database management technologies. HANA is SAP’s answer to the big data trend.
In an effort to stimulate innovation, SAP began the SAP Startup Focus program which is like an accelerator program for enterprise and IT companies that are working on predictive analytics products. Innovation can be tough in large companies and initiatives like Startup Focus and the Real Time Fund are intended to keep SAP ahead of the curve, or at least keeping pace with it. The company has actively been acquiring startups to this end as well.
The increased size of the fund is a reflection of the strong interest of entrepreneurs and VCs in participating in the SAP ecosystem. Elizabeth “Beezer” Clarkson, COO and Managing Director at SAP Ventures, said it is also indicative of a changing venture capital landscape.
“We believe we have a new model for corporate venture the start-up ecosystem is embracing,” she said. “The additional funding allows us to broaden the scope of what the SAP HANA Fund invests in to include all SAP platform technologies, for example, cloud, mobile or analytic technologies as well as HANA. We will also be able to extend our investment horizon for the SAP HANA Real Time Fund from 3-5 years to 7-10 years. Further, we will hire a business development staff and develop programs and partnership opportunities with the SAP ecosystem that deliver additional business value, like helping companies to grow internationally and exchange insights with industry experts.”
So far the fund has made investments in three startups — Gild, a recruiting solution that helps organizations find developers skilled in big data, FeedZai, a Portuguese startup that provided real-time fraud detection and prevention, and a third unnamed Israeli company. SAP HANA RTF (enough abbreviations for you?) has also committed funds to ten early stage venture capital funds including SV Angel, August Capital, and Data Collective in the Bay Area, and Point Nine and Magma in Berlin and Tel Aviv, respectively.
The fund is managed by SAP Ventures, which also manages a $353 million direct growth fund that invests in growth-stage IT companies. Over the past 15 years, SAP Ventures has invested in more than one hundred companies round the world including LinkedIn, Box, Violin Memory, and Lithium.
Photo Credit: SAP’s president Sanjay Poonen on stage at CloudBeat/Michael O’Connell