This is very tricky to do. Once you are part of a big company you are risking more than just your small startup.
There is brand risk - if a startup makes a bad product, then petfud.ly looks bad. If MS Startup Division does, MS looks bad.
If a startup makes a bad product that kills people (or they take on risky contracts with a big downside), they get sued out of existence. If some small division of MS does, MS gets sued out of existence.
Big companies are less agile for a good reason. They have a lot more to lose.
I think there's a way around this. For example, YouTube has remained a relatively separate brand from Google so I think things they do wouldn't reflect back on Google as much.
One company I think is really good at this is Amazon. IMDB, dpreview, Audible, Zappos, Woot, and Endless all have maintained their brand fidelity while also benefitting tremendously from Amazon's technology and assets.
Even negative press for Amazon's Web Services doesn't really impact the Amazon brand in most consumers eyes, which is pretty amazing in my opinion.
This leads to the conclusion that big companies should not innovate this way, rather foster own startups (with major or exclusive ownership) which are not associated with the brand (at least initially, while in risky phase).
OTOH buying a successful startup in the same field may be the simpler way to go?
There is brand risk - if a startup makes a bad product, then petfud.ly looks bad. If MS Startup Division does, MS looks bad.
If a startup makes a bad product that kills people (or they take on risky contracts with a big downside), they get sued out of existence. If some small division of MS does, MS gets sued out of existence.
Big companies are less agile for a good reason. They have a lot more to lose.