Sun sets up $300 m. VC pool, buys Innosoft

Sun Microsystems announced it has set up a $300 million venture capital fund

to help promising Internet startups get off the ground. It also announced the

acquisition of Innosoft electronic messaging company.

Sun’s services for start-ups will include providing including lab centers

for developing and testing ideas and discounts on packages of Sun computers and

software. The so-called "iForce" program will include expertise from

other companies, including Web hosting firms, Internet service providers and

software developers, to help startups overcome the big technical hurdles of

getting a new Web site or service up and running.

Since most Internet start-ups will needs lot of servers and workstations when

their business takes off, Sun stands to benefit from having those company

structured their business around Sun hardware and software. "The intent is

that you will come back to the people who helped you build it. That is where the

money will be made," said John Loiacono, Sun's chief marketing officer who

added that 1,000 startups have already signed up for the program.

Sun will open three iForce centers in Paris, Tokyo and Menlo Park,

California. Customers can test programs on a variety of hardware and software

platforms to make sure they work. The customer will be given an analysis of what

worked best and they can either buy the products from Sun or deal with another

company. Another Sun program, called Startup Accelerator, helps new businesses

figure out what they need, from Sun servers and Oracle databases to Web hosting

from Exodus Communications or Internet access. Sun then brings all the vendors

together and the customer can buy a complete package.

Meanwhile, Sun said it had agreed to buy Innosoft International to for its

Internet messaging products and technology. Financial terms were not disclosed.

Innosoft will join Sun's iPlanet electronic-commerce unit, an alliance with

America Online's Netscape unit that was formed a year ago to sell e-commerce

software. Innosoft's messaging and directory services will be added to iPlanet's

portfolio.