The strategy by Infosys and Wipro behind picking up stakes in startups is more than financial gains. Here it is

IT giants like Infosys and Wipro are using startups to impress and win clients. In a bid to give new solutions to their clients, these companies have added startups they have partnered with in their portfolio.

"Working with startups is a very important part of our strategy. Wherever necessary we will bring in startups into our solutions for clients and that helps to keep things, swings it in our favour," said Infosys’ Vishal Sikka.

Infosys and Wipro have invested in multiple startups to make up for talent and technologies that are not present with them.

"What we do when we make those strategic investments is we give them an opportunity to talk to our sales teams, business unit heads, how it can be incorporated into our business plans so that we can take it to the customer,” said Wipro’s Abidali Neemuchwala.

When a client partners with a startup, it is an independent pact, which also favours IT firms as it builds its reputation.

Executives told ET that Infosys had recently helped US financial services giant Visa set up a new technology centre and held talks with Daimler AG on building a technology facility for the German automotive giant. In both the instances, Infosys used some of their own portfolio companies like ANSR Consulting to help these customers.

“It's very interesting to see how they (Indian IT cos) are all looking to startup tech firms to maybe pivot their own business models can actually do nothing but help us," Karenann Terrell, chief information officer at Wal-Mart Stores, told ET.