Radical innovation has been described as a significant change that simultaneously impacts both business models and technology. Located right in the epicenter of the Silicon Valley Venture community, Menlo Park based Net Service Ventures focuses on sponsoring radical innovation. NSV were aware of the “buzz” of Cloud from an early stage, as start-ups and clients began to discuss the then emerging on-demand method of accessing resources. Over time, they have developed a leading understanding of Cloud – how it can be used by their clients, and what the potential could be for various players in the ecosystem.

DMR: Can you talk a little bit about the venture investments you make?

Jamie Allen: Net Service Ventures (NSV) Group is a boutique consulting business, as well as an angel investment firm. Our consulting side drives many of our investments: what we learn in advising our consulting clients, we take and apply it to our investing decisions. We started and incubated about 40 percent of the companies we have invested in. Of those companies, half of them have successfully gone out and raised significant venture.

DMR: Wow. Half of them, that’s a great success rate.

Jamie Allen: We’ve been very successful in our investing. This success is driven by the fact that we are investing in things that we know very well, things we know very well because they’re driven by the consulting we’re doing for our strategic consulting clients.

We started out as a consulting business. The investing came along as a secondary thing.  We were introducing Fortune 500 clients to the emerging technologies and business models that were happening in Silicon Valley. Through that process we were seeing a lot of companies. And we started thinking, “Hey, we ought to put a little bit of money in that company.” That’s how we got into the investment business.

DMR: So at what point did Cloud enter the discussion with your startups that you start or with your clients?

Jamie Allen: We were looking at a lot of companies in the video space and in advertising and so forth. And we started to hear from some very early stage companies: “I’m running this on Amazon web service.” “I’m running this on Google app engine.” That’s where my awareness of cloud computing as something other than just buzz came from. I started thinking about it and looking into it quite a bit. I discovered some people I know were very deep into it and were able to give me some insight. At that point we started advising some of our clients how cloud could affect their business.