WSJ News Exclusive | Microsoft Seeks Startup Partnerships in Battle With Amazon Over Cloud


Microsoft Corp. and Amazon . com Inc. are embracing a new tactic to win the supercharged battle for cloud-computing business, luring fast-growing startups by promising to help sell their services.

Microsoft on Monday announced a partnership with Abnormal Security Corp., under which the San Francisco-based email-security startup will move its software onto the tech giant’s Azure cloud. Microsoft, in return, promises to sell Abnormal’s services to its large enterprise clients, which Microsoft says is its first such arrangement. The companies didn’t disclose financial terms.

Amazon also has used the partnership model to bolster its cloud business. In January, it signed an agreement with Apptio Inc., a Bellevue, Wash.,-based software company that helps users manage their cloud spending. Apptio agreed to expand its use of Amazon Web Services, the online retail giant’s cloud, and Amazon now sells the startup’s services to its cloud customers.

“All these cloud platforms would love startups to build on top of them,” said Matt McIlwain, managing director at Seattle-based venture-capital firm Madrona Venture Group. “What’s new is this intentionality and saying, ‘We’re going to partner.’”

For the two cloud-computing giants those partnership deals could help sustain growth in a business segment that has become crucial to their financial fortunes—and increasingly competitive. The partners can tap the vast sales reach Microsoft and Amazon offer, providing access to a range of customers many startups and small enterprises could struggle to reach independently.


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