Software-as-a-Service HR platform Cornerstone OnDemand doesn’t get much respect, but the public company is worth almost $2.5 billion and has become a giant in the LA tech scene. Earlier today at the LA Tech Summit, Cornerstone announced a new initiative to give back to the community that gave rise to it, through the launch of an incubator and innovation fund.
While the fund isn’t exclusive to LA, Cornerstone did highlight the effort as an “opportunity to support the burgeoning Los Angeles technology community.” The company said it plans to make “a few” investments per year in the range of $250,000 to $1 million. Deals will need to be approved by Cornerstone’s board and will take place alongside partner VC firms.
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The incubator effort opens up space for startups at Cornerstone’s headquarters in Santa Monica. The company said it also plans to back teams of its own employees to work on ventures related to its product.
As Cornerstone grew over the years, CEO Adam Miller focused on preserving the startup feel of the company’s culture. In today’s announcement, he emphasized that the fund and incubator should serve that end.
“Our approach with the fund is to foster the development of great ideas and companies, even at the earliest of stages,” he said. “The fund is also a way to keep our entrepreneurial spirit alive and well at Cornerstone, even as we continue to grow and expand our business globally.”
When I spoke with BVP partner and Cornerstone board member Byron Deeter about the new fund, he emphasized that the fund itself is mostly a break-even play from a financial perspective.
“Creating a more vibrant tech ecosystem is really why [Cornerstone is] doing it. That creates synergy, it’s fun and it’s a way to give back,” Deeter said.
That’s not to say that mentoring up-and-coming startups won’t help its platform along the way, though. Since Cornerstone’s products scale up for medium and large organizations, it has plenty to gain from helping other companies grow.
“From a macro community standpoint, more great businesses create a virtual cycle of entrepreneurs and businesses,” Deeter added.
LA has seen a proliferation of accelerators and incubators in recent years from the likes of Amplify, Mucker Labs, Launchpad LA and StartEngine, but the new spaces have yet to catch up to the number of new companies that are starting up. With its latest fund, Cornerstone is poised to take its place as one of the cornerstones of LA tech.
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