Cisco Systems has launched Decibel, an independent venture capital organization focused on early stage investments.
The announcement came via a blog post from Cisco Investment’s Head of Corporate Development Rob Salvagno, who wrote:
“With Decibel, Cisco is adding another dimension to its multi-faceted approach to innovation – a relationship with entrepreneurs and the startup ecosystem at their earliest inception and with this, a lens into the people, technologies and trends that will shape the Enterprise in the decades to come.”
Decibel is helmed by Jon Sakoda, who spent 12 years as a venture capitalist at New Enterprise Associates. The organization will be separate from Cisco’s existing investment arm, which traditionally works with larger-scale companies.
Cisco Investments will continue to invest and partner with companies in Cisco’s core and adjacent markets, Salvagno said.
Meanwhile, Decibel’s independence is an important factor according to Salvagno. It will allow the company to move at an accelerated pace and make its own independent investment and governance decisions, all while accessing Cisco’s resources.
Cisco's Potential Funding Strategy
The launch is interesting for a range of reasons. Chief among them:
- Late-stage technology investments often have lofty valuations in the current market. An early stage move could allow Cisco to spot opportunities before their valuations become investment-prohibitive.
- Cisco used to leverage a spin-out, spin in strategy. Company executives used to leave Cisco, launch a new business with help from the networking giant, and then spin back into Cisco. That strategy essentially ended when the CEO crown shifted from John Chambers to Chuck Robbins. But perhaps Decibel will provide fertile ground for future spin-ins...
Additional insights from Joe Panettieri.
