Dell establishes $300 million venture fund to invest in emerging tech

The fund will invest in early-growth companies in the areas of storage, cloud, data, security, mobility and data centers

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Thu, December 12, 2013

IDG News Service (New York Bureau) — Dell has established a US$300 million venture fund that will promote the development of technologies important to the company's product portfolio.

The fund will invest in early-growth companies in storage, cloud computing, data, security, mobility, and next-generation data-center technologies, said Chief Financial Officer, Brian Gladden, during a keynote at the Dell World conference in Austin, Texas.

The venture fund, announced Thursday, comes a few months after a private equity buyout in which CEO Michael Dell and Silver Lake Partners acquired the company for $24.9 billion. As a private company, Dell can now focus on growth areas important to the company without the distractions of quarterly earnings that "clogged" the company's operations, Gladden said.

The fund will play a role in driving growth and help the company stay ahead of the technology curve, Gladden said. Some of Dell's past acquisitions were related to areas in which the company is looking to invest.

Dell Ventures, an investment arm of Dell, will work with venture capitalists and others to invest in companies.

The company will continue its long-term focus on the enterprise, will look at possible acquisitions and expand its research and development budget, said Michael Dell, who also spoke at the conference.

Despite shrinking PC sales, Dell will continue to invest in the market and introduce new tablets. The device market is a "keystone" to the company's growth, he said.

Going private paves the way for the company to grow at a faster rate, Dell said.

"We're also working to simplify our company," Dell said.

The company is focusing the conference on allaying fears among customers about its future. Customers have been concerned that some businesses, including the PC operations, would be nixed as the company cuts costs to improve profitability.

Going private also allows the company to take more bold bets without worrying about responding to investors, Dell said. The company can have a frank dialogue with customers without worrying about answering to the market, he said.

Software and storage are also a focus of the conference. Dell announced cloud partnerships with Microsoft and Google, and later Thursday will share more details about a partnership with Red Hat to co-engineer the OpenStack distributed computing environment in server deployments based on Red Hat Enterprise Linux.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for IDG News Service. Follow Agam on Twitter at @agamsh. Agam's e-mail address is agam_shah@idg.com

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