Author: Gregory T. Huang

  • Intellectual Ventures Hires New President

    Gregory T. Huang wrote:

    Bellevue, WA-based Intellectual Ventures announced this week it has hired Adriane M. Brown as president and chief operating officer, responsible for day-to-day operations. She succeeds Edward Jung, the Intellectual Ventures co-founder, who is returning to his role as chief technology officer. Brown was most recently senior vice president of energy strategy at Honeywell International, and previously held other leadership roles at Honeywell and Corning. Intellectual Ventures is focused on the business of invention. Led by CEO Nathan Myhrvold, the firm has $5 billion under management and more than 650 employees worldwide.







  • Going nuTsie: Melodeo Looks to Beat Apple to the Punch with New Cloud-Based Music Service

    nuTsie (courtesy of Melodeo)
    Gregory T. Huang wrote:

    Things have been crazy busy over at Melodeo for the past month. I don’t think any of those guys took time off during the holidays this year. As I detailed in a story earlier this week, the Seattle-based company has been ramping up its long-standing efforts in cloud-based music delivery ever since Apple acquired its closest competitor, Palo Alto, CA-based Lala, last month.

    Yesterday, Melodeo upped the ante on the whole field of streaming music, which, besides Apple, includes players like Pandora and Rhapsody (from RealNetworks). The company officially unveiled the details of its next version of nuTsie (3.0), its flagship software application that works with Apple’s iTunes. It sounds like the company’s most ambitious offering to date, and the service is supposed to launch on Google Android—and presumably other platforms—sometime this quarter.

    As Melodeo executives explained it to me, nuTsie 3.0 gives any smartphone or Web-connected device the full capabilities of an iPod music player. So what? First of all, there is a big market for people who use iTunes but don’t have an iPod or iPhone—more than 200 million consumers, according to Melodeo. So nuTsie can give these people access to their music wherever they are, for far cheaper than an iPod, and on their existing device.

    Second, nuTsie 3.0 is supposedly better than an iPod, for three reasons: it wirelessly syncs with consumers’ iTunes libraries (add a new song and it shows up on all devices—“nobody has really cracked that,” says Melodeo vice president Dave Dederer); it does “smart caching” of songs, meaning it accounts for limited storage space on devices and makes a consumer’s top songs available for plane rides and other off-the-grid times; and it lets users discover new music in an unlimited, full-track way.

    nuTsie song list on Nexus One

    “We’ve taken recommendations, top 100 radio, and your friends, and brought them together,” Melodeo CEO Jim Billmaier told me recently. He also mentioned that the new service will extend to video, podcasts, e-books, and other digital media.

    In terms of the technology, the new version of nuTsie is different from the previous version in that it takes consumers’ actual music files and puts them in a “private cloud,” Dederer says. So people will have full control over their iTunes, instead of having their playlists streamed to them in “shuffle” mode.

    With its new product announcement, Melodeo is looking to beat Apple to the punch in offering a full-service Web-based platform for music and other entertainment. We’ll be watching closely to see what happens between these two companies, and others, in the months ahead.







  • RealNetworks CEO Rob Glaser Steps Down

    Rob Glaser
    Gregory T. Huang wrote:

    Rob Glaser, the founder and chief executive of Seattle-based RealNetworks, has stepped down, according to a company statement. Glaser will remain chairman of the board.

    “After nearly 16 years, I’ve decided it’s time for me to step away from day-to-day operations,” Glaser said in a statement. “I’m grateful to all of our stakeholders—customers, partners, shareholders, and most of all, employees—for the support and commitment they’ve given to RealNetworks. I remain committed to the company and look forward to continuing to serve in my capacity as board chairman.” (See Glaser’s farewell note to Real’s employees here, from the Seattle Times.)

    Real’s board of directors appointed Robert Kimball as president and acting CEO, and new board member. Kimball joined RealNetworks in 1999 and was most recently the company’s general counsel and executive vice president of corporate development. Glaser said a formal search process for a permanent CEO will begin soon.

    The move seems to be part of a broader shakeup of the senior leadership team at Real (NASDAQ: RNWK). Yesterday, the company reported in an SEC filing that chief operating officer John Giamatteo will resign as of April 2. Giamatteo was also president of the company’s technology products and services division. The news was reported by PaidContent, TechFlash, and other outlets.

    In November, RealNetworks laid off 4 percent of its worldwide staff (about 70 employees) as a result of the economic recession and cost-cutting measures. The company reported a small profit for the third quarter of last year, its first profitable quarter since the beginning of 2008.







  • Visible Technologies Tracks Down $22M for Global Expansion

    Visible Technologies
    Gregory T. Huang wrote:

    Things are really heating up for Visible Technologies. The Bellevue, WA-based maker of software to help companies monitor social media and manage their online reputations announced today it has raised a Series C funding round worth $22 million. The round was led by a new investor—Investor Growth Capital (IGC), the growth-stage venture arm of Investor AB. Existing investors Ignition Partners, Centurion Holdings, In-Q-Tel, and WPP also participated.

    “This funding allows us to accelerate our growth path to continue meeting the demands of global customers and help them drive real business results through successful online consumer engagement,” said Visible CEO Dan Vetras in a statement. “We chose IGC as our partners to lead the round for their market expertise, track record in creating sector-leading companies and ability to help us expand in markets outside North America, especially in Europe.”

    Visible Technologies was founded back in 2003, and its cutting-edge technology finds positive and negative content about a brand online, for example, and uses keyword placement, optimization, and linking techniques to make the positive entries pop up higher in search-engine results. In the past year, the company has raised smaller amounts of equity and debt financing—it had raised a total of $23.5 million as of October 2009. Its customers include Microsoft, Autodesk, and Xerox.







  • Big Fish Expands Deal with PlayFirst

    Gregory T. Huang wrote:

    Seattle-based Big Fish Games, a developer, publisher, and distributor of casual video games, has expanded its existing strategic partnership with San Francisco-based PlayFirst. As of today, Big Fish will provide e-commerce and customer support services for PlayFirst’s game distribution portal, while PlayFirst gets access to Big Fish’s catalog of games. Financial terms weren’t given, but it is a multi-year deal. Big Fish Games was founded in 2002. It raised $83.3 million in 2008 and made a couple of senior leadership hires last fall.







  • Where the Jobs Are: PayScale Lands New Board Member, Exposes Three Trends in Human Capital

    PayScale
    Gregory T. Huang wrote:

    Whether you’re a startup founder, Fortune 500 executive, or average Joe on the street, everyone is wondering what 2010 will look like for jobs and compensation. Indications so far are not good. Unemployment rates are sky-high. Salary freezes are still rampant. At the same time, nobody can seem to agree on how to pay executives what they’re really worth. ($23 billion in bonuses to Goldman Sachs employees?)

    I took the opportunity to talk about some of these issues with the leadership at PayScale, a Seattle company that provides real-time compensation data to employers and employees, through what it calls “the world’s largest database of individual compensation profiles.” From where he sits, PayScale CEO Mike Metzger has an intriguing view of current trends in “human capital,” which I loosely define to include the talent flow, skill sets, experience, and compensation levels associated with creating economic value.

    PayScale also announced a new board member today. She is Robin Ferracone, the CEO of RAF Capital, executive chair of Farient Advisors, and an expert in human resources with more than 25 years of consulting experience. Ferracone, who’s based in the Los Angeles area, has made a modest but undisclosed investment in PayScale, according to the company. (Metzger and Ferracone first met through another board member, Patricia Nakache from Trinity Ventures.)

    “It’s a very interesting business,” Ferracone says. “When you get pay data directly from the consumers, you then get information about the individual. What PayScale does is it’s able to fill in the gaps about jobs that don’t get picked up by surveys.” That includes things like salaries across different offices and geographic regions for a given company, say—all updated continuously instead of once or twice a year.

    PayScale was founded in 2002 and has been backed by Fluke Venture Partners, Madrona Venture Group, Trinity Ventures, and others. A year ago, the company raised a $2 million Series C funding round. Metzger says PayScale’s staff now numbers in the “high 40s,” and that the company is not yet profitable, but is “driving hard” for profitability in 2010. He adds that it is coming off its best year and best quarter ever, in terms of revenue.

    Here are the top three trends that Metzger and Ferracone are seeing in human capital as we head into 2010. (Metzger prefaced his comments with the caveat that PayScale sells its aggregated data mainly to small and medium-size businesses, so his view is biased towards those customers, versus Fortune 1000 companies.)

    1. 2010 will not revert “back to normal.”

    A lot of organizations in 2009 froze their compensation adjustments, says Metzger. “Flat was the new up. One of the themes we’re starting to hear now is that in 2010, things will not go back to normal.” That means companies are “beginning to sharpen the lens they’re using relative to the cost of human capital” and “taking a conservative posture in when they’ll make adjustments.”

    The days of across-the-board pay increases plus merit bonuses seem to be gone for good. Overall, Metzger calls the situation “a little bit of a reset in terms of comp adjustment strategy.” And Ferracone adds, “We’re seeing [companies] not trying to make up for lost time, on the salary front.”

    2. Talent is still in high demand in certain fields.

    It’s not like nobody’s hiring. “There continue to be sectors and geographies where there are high demands for talent—IT in the Bay Area, nursing everywhere, and accounting in major metro …Next Page »







  • DataSphere and Halosource Get Funded, Sage Signs Up Pfizer, Zymo Raises $90M, & More Seattle-Area Deals News

    Gregory T. Huang wrote:

    2010 is off to a pretty fast start in terms of Northwest deals. We’ve already seen a lot of action in biotech, software, and cleantech.

    —Seattle-based InstantService, a provider of live chat services, was acquired by Art Technology Group (NASDAQ: ARTG) of Cambridge, MA, an e-commerce software firm, for $17 million in cash, as Wade reported. InstantService’s technology will be used to help ATG’s clients offer live text-based chat with customer service agents on e-commerce sites.

    —San Diego and Seattle-based VentiRx Pharmaceuticals raised $25 million in new funding, as Luke reported. The financing, which is an extension of a $26.6 million Series A deal from 2007, was led by new investor MedImmune Ventures, while existing investors Arch Venture Partners, Frazier Healthcare Ventures, and Domain Associates also participated. VentiRx is developing drugs to boost the body’s innate immune system to fight cancer and allergies.

    Sage Bionetworks, the Seattle-based nonprofit that’s leading a movement toward open-source sharing of biological data, has formed a partnership with Pfizer (NYSE: PFE), as Luke reported. Financial details and other terms weren’t disclosed, but the deal will provide enough cash for Sage to hire some new staff and will help support the nonprofit’s goal of building computational models in “network biology.”

    —Seattle-based ZymoGenetics made $90.9 million in a stock sale after discounts and expenses. The company’s investors and underwriters bought 16.1 million shares at $6 apiece. The money will be used for R&D and to help ZymoGenetics (NASDAQ: ZGEN) market its drug for combating surgical bleeding.

    Kineta, a Seattle biotech company developing treatments for viral infections and autoimmune diseases, raised $942,000 in equity, debt, and options from 25 investors, as Luke reported.

    —Bothell, WA-based Halosource, a maker of water purification technology, raised $10 million in a Series D financing led by Prime Partners Asia Merchant Capital of Singapore, as Luke reported. Halosource’s investors include Credit Suisse, Siemens, the Abu Dhabi Investment Authority, and in Seattle, Alexander Hutton Venture Partners, Buerk Dale Victor (now Montlake Capital), and WRF Capital. The new money will be used to fuel Halosource’s expansion to more developing countries.

    —Kirkland, WA-based OVP Venture Partners led a $9 million investment in Aggregate Knowledge, a San Mateo, CA-based online advertising and analytics firm. Kleiner Perkins Caufield and Byers, DAG Ventures, and the company’s original angel investors also participated in the deal. The Seattle connection between Aggregate Knowledge and OVP was David Jakubowski, a former Microsoftie and advertising technology expert who is now AK’s chief revenue officer.

    —Bellevue, WA-based DataSphere raised $10.8 million in Series B funding from Ignition Partners and two other strategic investors. DataSphere works with media companies to power hyperlocal websites and local advertising on those sites. I spoke with CEO Satbir Khanuja about his company’s strategy and prospects.

    —Seattle cleantech software firm Verdiem raised $4.7 million in equity financing, according to a regulatory filing, as Luke reported. The investors were not disclosed. Verdiem’s software for personal computers is meant to help big companies and other organizations cut their electricity consumption.

    —Seattle-based RealNetworks acquired Varia Mobile, also in Seattle, for an undisclosed amount. Varia, which makes content distribution and publishing software for mobile phones, was founded in 2007 and had a strategic alliance with RealNetworks (NASDAQ: RNWK) prior to the acquisition.







  • Melodeo, Making Big Push in Online Music, Eyes Apple in the Cloud

    nuTsie
    Gregory T. Huang wrote:

    OK, so you’re a small, profitable tech company in the digital media sector. Your closest competitor just got acquired by Apple. Now Steve Jobs is encroaching on your territory. How do you want to play it?

    That’s the situation Seattle-based Melodeo faces after Apple paid a reported $85 million last month to buy online music startup Lala, based in Palo Alto, CA. It looks like Apple (NASDAQ: AAPL) is making a play to own the streaming music market, breaking with its traditional approach of selling music downloads via iTunes. The implications pose a challenge for nuTsie, Melodeo’s flagship streaming music service that lets iTunes users play their songs on their (non-iPhone) mobile phones and netbooks.

    After the story emerged that there had been a bidding war for Lala, reportedly between Apple and Google (and probably others), rumors of acquisition talks involving Melodeo also have surfaced. Reached by phone, Dave Dederer, Melodeo’s vice president of business development, declined to comment specifically on any talks. “Like any small, venture-backed company, at some point we need a bigger partner to bring our efforts to their greatest possible fruition,” he says. “The Lala acquisition has accelerated conversations we’ve been having. A lot of people have been courting us over the last few weeks.”

    In the meantime, Melodeo is raising the bar on its products. Last week, it released an application that analyzes the iTunes playlists on your iPhone or iPod Touch and automatically creates new playlists that it streams to you over the Web. The new app is called “Effin Genius,” a play on the “Genius” song-recommendation feature of iTunes. (It’s kind of awesome.) Effin Genius has gotten some rave reviews; CNET called it “Pandora’s smart little brother.” And Melodeo is building buzz around a new product to be announced soon—as early as this week—which is supposed to give any smartphone or Web-connected device the capabilities of an iPod, only better.

    It’s all part of the company’s efforts to march to the beat of its own drum in online music. For now, the math is simple: there are about 400 million iTunes customers (Apple has roughly 75 percent market share of digital songs), but only 100 million-plus iPhone and iPod users. …Next Page »







  • Buerk Dale Victor Renamed Montlake Capital

    Gregory T. Huang wrote:

    Seattle-based venture capital and private equity firm Buerk Dale Victor announced today it has changed its name to Montlake Capital. The new name recognizes the firm’s evolution from a local partnership (founded in 1999) to a regional investment team with partners in Washington, Oregon, Montana, and Idaho. Montlake Capital has $100 million under management, and says in 2010 it will invest in and seek partner companies with revenues between $2-20 million. The firm previously backed Halosource, the Bothell, WA-based water purification company that raised $10 million last week.







  • DreamBox, Gist, VholdR Among WTIA Finalists

    Gregory T. Huang wrote:

    The Washington Technology Industry Association (WTIA) announced today the finalists for its 15th annual Industry Achievement Awards on March 4. Among the nominees are DreamBox Learning, Gist, and VholdR (for breakthrough startup of the year); Cheezburger Network, Cozi, and Picnik (for consumer product); Apptio, Concur, and Talyst (for commercial product); and Neah Power Systems, Pathway Medical Technologies, and Powerit Solutions (for innovative manufactured product).







  • Jive Posts Record Revenue

    Gregory T. Huang wrote:

    Portland, OR-based Jive Software, a maker of social business software, posted an 85 percent increase in full-year revenue in 2009 as compared with the previous year, according to a blog post today from CEO Dave Hersh. That made 2009 “the most successful year in Jive’s history,” and the company was cash-flow positive for the year, he writes. Its customers include Booz Allen Hamilton, EMC, Kaiser Permanente, and Qualcomm. Back in October, Jive announced a $12 million Series B financing from Sequoia Capital.







  • Zappos CEO Tony Hsieh’s Unique Take on Startup Hiring and Culture

    Zappos
    Gregory T. Huang wrote:

    What’s more annoying than a 24-year-old who sells his company to Microsoft for $265 million and never has to work another day in his life? Easy. When that same guy sells his next company to Amazon.com for more than $1 billion.

    OK, so it took 10 more years of hard work, but Tony Hsieh, now in his mid-30s, seems to be in pretty good shape. The CEO of Zappos, the Las Vegas-based online shoe retailer bought by Amazon last summer, was the subject of a Q&A in the New York Times yesterday in which he talked about startup culture and hiring practices. In particular, Hsieh (pronounced “shay”) touched on things like why he sold LinkExchange to Microsoft back in 1996 (“the culture just went completely downhill”), and the one question he would ask a prospective hire today.

    I came away with two things from the interview. First, Hsieh has a very interesting hiring style. Assuming a candidate has the right skills and experience, then the most important thing, Hsieh says in the piece, is “are they going to be good for the culture?” CEOs always say that, but Hsieh seems to mean it in a more personal way. “We’ll invite them to barbecues on weekends and they bring their families,” he says—it’s a way to tell “whether you feel like you can actually get to know them on a personal level or if they’re very professional and standoffish.”

    What’s interesting is that he’s trying to gauge “how self-aware people are and how honest they are,” he says. “I think if someone is self-aware, then they can always continue to grow. If they’re not self-aware, I think it’s harder for them to evolve or adapt beyond who they already are.” To this end, the one question Hsieh says he’d ask in the interview is, “What would you say is the biggest misperception that people have of you?”

    My second takeaway, related to the first, is that culture is everything to Zappos. The company values “a little weirdness” in its employees—something that works for some startups better than others. So Hsieh says he also asks candidates how weird they are on a scale of 1 to 10. The number isn’t as important as “how candidates react,” he says.

    Just for the record, here are Zappos’s 10 cultural tenets, according to Hsieh (and there are typically interview questions for each one):

    1) Deliver WOW Through Service
    2) Embrace and Drive Change
    3) Create Fun and A Little Weirdness
    4) Be Adventurous, Creative, and Open-Minded
    5) Pursue Growth and Learning
    6) Build Open and Honest Relationships With Communication
    7) Build a Positive Team and Family Spirit
    8) Do More With Less
    9) Be Passionate and Determined
    10) Be Humble

    What Hsieh didn’t talk about in the NYT interview was Amazon and the cultural fit there—probably because nobody seems to talk about Amazon after being acquired by the Seattle giant. We’ll be watching to see how the integration goes…







  • MIT MBA Students: Amazon, Google, and T-Mobile Are Hiring, Expedia Isn’t; Microsoft “Super Interesting,” Apple Is “Sterile”

    MIT Sloan School of Management
    Gregory T. Huang wrote:

    [Updated 3:30pm 1/9/10 with clarification (see below)] If you want to know which companies are looking to hire top young business talent around town, just ask the group of 20 or so first-year MBA students from MIT Sloan School of Management. The students from Cambridge, MA, are in Seattle this week looking to make contacts for jobs and summer internships.

    It’s all part of the annual “tech trek” program in which some 150 Sloan MBA students split up to visit companies in Seattle, Silicon Valley, and the Boston area. The students on the Seattle leg visited Adobe, Microsoft, and RealNetworks yesterday, and they are at Amazon, Starbucks, and T-Mobile today.

    I met up with a group of them over drinks last night. They had a refreshingly candid perspective on job prospects at Seattle tech companies, and some valuable insights into the local tech-business scene. (Almost worth the $43 parking ticket I got from the BluWater Bistro lot—it’s been one of those weeks.)

    “The job market is better than last year. Companies are very receptive, and positions are open,” says Sloan student Hilda Tang, a former management consultant in New York City and a native of Vancouver, BC. Tang helped organize this year’s trip to Seattle, together with fellow first-year Ryan Thurston, a former design engineer and product manager at Seattle-based Impinj. “Everyone’s hiring, but they’re hedging their bets,” Thurston says.

    Kathryn Wepfer, another Sloan student, previously worked for four years at General Electric in Massachusetts managing a technology development program (defense work). Wepfer went on the Silicon Valley leg of the trip earlier this week, where Sloan students visited VMware, Cisco, Google, Apple, LinkedIn, Yahoo, and Zynga. Last year, Google and Yahoo didn’t participate, as their hiring was on hold. This year, the students say Google is hiring selectively for positions in finance, operations, marketing, and business development; Yahoo didn’t impress, with one student commenting, “What are [they], really?”

    It sounds like some companies were much better at marketing themselves to students than others. The strongest reaction I got was when I asked about their visit to Apple (in Silicon Valley). “Everyone came away totally creeped out,” one student said, adding that the company came off as “secretive” and “sterile,” and that during their visit, at least one Apple employee admitted it wasn’t a great place to work while Steve Jobs was on leave.

    [This paragraph added on 1/9/10 for more context on Apple—Eds.] This student followed up with me later to say, “We heard from people in finance, marketing, and product management—everyone hands down was very excited about their job and being part of the Apple community. It’s a very attractive company to me, but it is somewhat difficult to see the reality of the secretive culture that may be necessary to maintain Apple’s ability to create products that change the world. I, and I think the rest of the group, appreciated their openness and honesty.”

    On the Seattle front, I had to wonder about Microsoft, which is coming off a year of …Next Page »







  • Of Slates, Tablets, and Kindles: The Most Important Message of CES 2010

    CES
    Gregory T. Huang wrote:

    Lost amidst the cacophony of the Consumer Electronics Show in Las Vegas is a simple message. It has nothing to do with what Microsoft did or didn’t announce—for example, some upcoming “slate PCs,” but no foldable book-like tablet or other rumored gadgetry. It has nothing to do with Google’s Nexus One “superphone,” with HTC and T-Mobile, which was announced outside of CES. It has everything to do with where laptops, netbooks, e-book readers, and gaming consoles are all converging.

    Behold the tablet PC. And everything old is new again.

    Last night, Microsoft CEO Steve Ballmer gave a preview of some of these devices, including a sleek touchscreen tablet PC made by Hewlett-Packard (with Windows 7 and Amazon’s Kindle software) that’s coming out this year. Ballmer’s keynote was described as “disappointing,” “uninspired,” and a “snooze-athon” by people who debate these things for a living. I have to say I disagree, though it was hardly great theater.

    It’s true, Microsoft has been pushing tablet PCs since 2000, when Bill Gates first demonstrated a prototype at a similar tradeshow. But now, 10 years later, the form factor and interface capabilities actually make sense to people. (Microsoft can thank Apple and Amazon for that.) And with the cost of touchscreen components falling, it’s finally time for all those great interface technologies—handwriting apps, text-input software, video and image search, augmented reality—to take off. Microsoft looks like it’s trying to get ahead of Apple’s forthcoming touch-screen tablet or slate device, rumored to be announced later this month.

    People in the know have been saying for a while that e-book readers like the Kindle are really just a stop along the way to a merged device that will let consumers read books, browse the Web, and run their favorite entertainment apps (games, music, video) on the go. In order to take off, though, tablets will need to replace something else. Nobody wants to carry around yet another device. Phones are safe for now. My long-term money is on the Kindle, iPod Touch, and handheld game consoles like the Sony PSP and Nintendo DS to get wiped out. With netbooks and laptops eventually to follow, once the text-input problem is satisfactorily solved.

    Your move, Apple.







  • Three Questions on Hyperlocal Advertising with Satbir Khanuja, CEO of DataSphere

    DataSphere
    Gregory T. Huang wrote:

    In the world of news media these days, there’s no getting away from two things: online advertising, and hyperlocal sites. Where they meet is a company called DataSphere in Bellevue, WA.

    On Tuesday, we reported that DataSphere had raised $10.8 million in Series B funding. The investors in the new round are Ignition Partners, also based in Bellevue, and two unnamed publicly traded companies, which are strategic investors. Ignition and one of the public companies previously invested in DataSphere’s $6.5 million Series A round back in July 2006.

    DataSphere, which was called SecondSpace until last year, has been collaborating with media companies like Fisher Communications and Cowles California Media to help them roll out hyperlocal (neighborhood) websites, about 150 of them across five states: Washington (including 46 sites based in and around Seattle), Oregon, Idaho, California, and Rhode Island. DataSphere’s technology platform organizes website information, makes it searchable, and connects local advertisers with local sites and consumers. (You can check out the DataSphere-powered search capabilities and hyperlocal sites and ads at KOMOnews.com, for example.)

    One outside observer thinks DataSphere is pretty interesting, but wonders about the size of the market from a VC’s perspective. “It’s a smart group of guys and investors,” says Lucinda Stewart, a managing director at OVP Venture Partners who focuses on online advertising, among other sectors. “They need to prove out the business model a bit more.”

    The company currently has more than 70 employees and is led by chief executive Satbir Khanuja, a seven-year Amazon.com veteran who holds a PhD in ceramics engineering from MIT. (He has been in the business world long enough that he doesn’t sound like a PhD—probably a good thing.)

    I had a good chat with Khanuja earlier this week about his company’s technology and business strategy. Here are some edited highlights:

    Xconomy: Can you explain how DataSphere is new and different, in a nutshell?

    Satbir Khanuja: The overall idea for us is to create a compelling hyperlocal experience for users and advertisers. We are collaborating with local media companies and leveraging their brand equity they’ve built, and applying our technology platform. In a traditional site, the [ad] inventory is accessible only to medium and large advertisers.

    What we do is, let’s take all your news and show it in a contextually relevant way to all of the user base. You choose your neighborhood as a default site. We show that user a specific user experience. Now we have the ability for local advertisers from that neighborhood to show ads to only those users.

    X: How does your platform and revenue model work? And how are these hyperlocal sites doing?

    SK: If you work with one of the media companies, they already have the resources. We’ve created a forum and platform with them to have a conversation with their user base throughout …Next Page »







  • SpectraWatt, Now in NY, Gains $12M

    Gregory T. Huang wrote:

    Solar cell manufacturer SpectraWatt, a spinoff from Intel formerly based in Hillsboro, OR, has raised $12 million in equity, debt, and options (out of a $41.4 million offering), according to a regulatory filing. The investors were not disclosed. Last spring, SpectraWatt announced it was moving its headquarters to upstate New York, citing “green business incentives.” The company has since set up offices and manufacturing facilities in Hopewell Junction, NY. Back in June 2008, Intel Capital led an initial $50 million investment in SpectraWatt, and was joined by Cogentrix Energy, PCG Clean Energy and Technology Fund, and Solon AG.







  • OVP Leads $9M Investment in Aggregate Knowledge, Gets Serious About Online Ads

    OVP Venture Partners
    Gregory T. Huang wrote:

    Kirkland, WA-based OVP Venture Partners is leading a new $9 million Series C financing round in Aggregate Knowledge, an online advertising and analytics firm in San Mateo, CA. Kleiner Perkins Caufield and Byers, DAG Ventures, and original angel investors are also participating. In connection with the deal, OVP managing director Lucinda Stewart is joining the board of Aggregate Knowledge.

    Although it’s a Series C investment in a company founded in 2005, Stewart says it was priced like an early-stage deal, with the existing investors cooperating in a recapitalization of the firm. (That means the previous investors’ stakes aren’t worth what they used to be.) “We came in to create a fresh new company,” Stewart says. The deal signifies OVP’s emerging interest in the online advertising and marketing sector, where it does not yet have many investments.

    Aggregate Knowledge, led by CEO and founder Paul Martino, currently has 26 employees. The company’s vision is to enable major publishers and retailers to personalize their display ads in real-time. Aggregate Knowledge does this with machine-learning algorithms that make sense of huge amounts of data that publishers and retailers have on their customers. The company counts The Washington Post, Cablevision, and Sam’s Club among its customers and partners. Aggregate Knowledge plans to use its new cash infusion to take its technology a step further, in part by offering it to advertising agencies and marketers who want to run more precisely targeted ad campaigns.

    The Seattle connection to this company came in the form of David Jakubowski, a former Microsoft veteran who joined Aggregate Knowledge about two months ago as its chief revenue officer and general manager. Jakubowski was most recently senior vice president at Specific Media, an Irvine, CA-based ad technology firm which has a Seattle office. He previously worked at Quigo Technologies, a search marketing firm, before becoming general manager of Microsoft adCenter and Search Strategy. Jakubowski has also been an advisor to Seattle-based Lucid Commerce, another OVP-backed startup in the analytics and marketing field.

    It took me a while to see how Aggregate Knowledge is any different from Seattle-area online ad firms like BlueKai, AdReady, and Mpire. As I understand it, BlueKai would sell its consumer data to companies like Aggregate Knowledge. AK (and other firms) then use that data to predict audience behavior, and help advertisers and publishers craft and place ads that change based on precise demographics like gender and age. One key difference is that Aggregate Knowledge is generally focused on bigger customers than AdReady is, for example, although both firms share the goal of making display ads as effective at generating sales as search-engine ads (like those from Google).

    “AK provides transparency into the value of inventory for the demand side, the guys who own the websites, the retail companies,” Stewart says. “For 30 years, the ‘buy’ side has never had these tools…Whoever has the data wins now.”

    As for the broader significance to OVP, Stewart adds, “We have a strong interest in deals that leverage ‘big data.’ That’s the thrust behind our entire computational biology strategy, and a lot of our cleantech and advertising and IT deals.”







  • DataSphere Raises $10.8M to Help Media Companies Manage Hyperlocal Websites (and Make Money)

    DataSphere
    Gregory T. Huang wrote:

    Bellevue, WA-based DataSphere, an Internet software and advertising sales company, has raised $10.8 million in equity and options, according to a filing with the SEC. The investors in the round were not disclosed, but the company is backed by the venture firm Ignition Partners, also based in Bellevue. John Connors of Ignition is listed on the form as a director of DataSphere.

    DataSphere and Ignition Partners could not immediately be reached for comment. According to the regulatory filing, “The total offering amount reflects $8,805,382 of the issuer’s Series B preferred stock, and warrants exercisable to purchase up to $1,999,999 of the issuer’s Series B preferred stock.”

    In the past few months, DataSphere’s technology has been used by Fisher Communications and Cowles California Media to launch a large number of “hyperlocal” neighborhood news websites—some 43 in Washington (Seattle area), 38 in Oregon (Portland and Eugene), and 40 in California (Monterey and Santa Barbara).

    DataSphere was founded as SecondSpace in 2006 and changed its name last year. The company makes an online platform to help media, real estate, and retail firms do things like manage websites, track audience behavior, and do search and information discovery. It is led by CEO Satbir Khanuja, a seven-year Amazon.com veteran who holds a Ph.D. in ceramics engineering from MIT, according to his biography on the DataSphere website.







  • The 12 Days of Xconomists: Leading Innovators Give Their Top Advances of the Past Decade

    Gregory T. Huang wrote:

    Over the last few weeks, as the holiday season heated up and the decade wound down, we reached out to our distinguished network of Xconomists—who include many of the top technologists, scientists, and business innovators in our three cities—and asked them (and a few more tech and life sciences leaders) to describe the most important innovations of the past 10 years in their respective fields.

    We figured we’d get two or three who could take time out during this busy season to write for us, but we were wrong. The response was staggering. We received so many thoughtful posts about the last decade (more than a dozen) that we’ve only just begun to look forward and process their responses to the other question we asked—about the biggest advances they think will come in the next decade.

    Beginning today, with Boston Xconomist Michael Greeley’s Venture Capital Oscars piece about the films that best represent the economic and investment climate of the next few years, we will be running a series of posts about the coming decade. But before we dive deeply into those, we thought it would be useful to take a minute—pause—and actually think some more about what these experts have told us so far. So here is a rundown of 12 Xconomist Forum reflections on the 2000s, noughties, or whatever you want to call them:

    Top Five Robotics Hits of the 2000s (Rod Brooks)
    Highlight: “Thousands of remotely piloted and autonomous aircraft in the U.S. military.”

    Top Five Biotech Innovations of the 2000s (Jay Lichter)
    Highlight: “Genentech’s ranibizumab (Lucentis)—The first treatment of its kind for the ‘wet’ form of macular degeneration.”

    Top Five Global Health Innovations of the 2000s (Christopher Elias)
    Highlight: “New recombinant, platform-based [vaccine] technologies may greatly speed vaccine production, decrease manufacturing costs, and increase production in developing countries.”

    Top Five Medical Innovations of the 2000s, and One Big Concern (James Topper)
    Highlight: “The development of novel mechanisms and combination therapies in HIV, which have turned a universally fatal disease into a chronic one.”

    Four Groundbreaking Innovations from the 2000s, and One More Life-Changing Event (Chad Waite)
    Highlight: “A night that I was in NYC (home of the ENEMY) in October 2004 when the Red Sox FINALLY won the World Series!” (OK, also the iPod. And Facebook.) …Next Page »







  • Stephen Wolfram Talks Bing Partnership, Software Strategy, and the Future of Knowledge Computing

    Stephen Wolfram
    Gregory T. Huang wrote:

    There is something oddly human about Stephen Wolfram using his iPhone to look up the mass of the “cascade hyperon,” a subatomic particle with who-knows-what properties. That’s what Wolfram, one of the world’s most distinguished experts in physics and computing, was doing on the day we spoke a few weeks ago.

    Maybe it stood out because it means that even Wolfram—whose depth of scientific knowledge seems to exist on a different plane from other humans—needs a smartphone these days. Or maybe it’s just funny that anyone would use an iPhone app to look up such a thing.

    In any case, Wolfram, 50, is a renowned scientist, author, and business leader. Born in London, he resides in the Boston area, but his company, Wolfram Research, is global, with headquarters in Champaign, IL, and 600-some employees spread around the U.S., Europe, and Asia. Last May, he launched an ultra-ambitious project called Wolfram Alpha, a kind of “knowledge engine” that answers queries about everything from geography to statistics to finance by “computing” the answer from an extensive database. It’s different from a search engine, which returns a list of links and documents. But the two can work together: in November, Microsoft announced it had formed a partnership to incorporate Wolfram Alpha into some of Bing’s search results.

    So it was high time I checked in with Wolfram, whose career I have followed over the years. Interestingly, he calls Wolfram Alpha “the most complicated project I’ve ever done.” That says quite a lot, given that Wolfram spent more than a decade writing A New Kind of Science, the 1,200-page tome he released in 2002 that potentially turns every field of science and technology on its head. He is also the creator of Mathematica, a software program used widely for scientific and technical computing (things like modeling, simulations, and visualizations)—it’s the main reason Wolfram’s company has been profitable since 1988.

    We spoke by phone on a quiet December afternoon just before the holidays. I asked him about the technology and strategy behind Wolfram Alpha and the future of search engines and knowledge engines, as well as business lessons learned from building his company and running it remotely. (I also couldn’t resist asking for his take on the massive physics effort at the Large Hadron Collider, the Swiss-based particle accelerator that amounts to the biggest science experiment in history.)

    If you’ve ever interviewed Wolfram, you know to choose your questions wisely. It’s not just that he doesn’t suffer fools, but that he answers every question so thoroughly that he will embark on tangents that turn out to be mind-blowing—much more interesting than the path of the original question. Which is a bit like the best queries in science, business, and Wolfram Alpha itself, come to think of it. (You should try the site here if you haven’t yet.)

    Here are some edited and slightly condensed highlights from our conversation:

    Xconomy: Tell me about the organizational structure of Wolfram Alpha. How big is the project?

    Stephen Wolfram: Wolfram Alpha has about 200 people. The parent company is Wolfram Research, and headquarters are in Champaign. It’s quite a distributed operation at this point. There are pieces in Boston and the U.K. We have one or two people in Seattle. Our people are scattered literally all over the world. I set a bad example by being a remote CEO starting in 1991. For many kinds of things, it’s tremendously productive.

    X: What are your tips for managing a company remotely?

    SW: My theory is the most productive form of meeting is conference calls with Web conferencing. You can have more people in the meeting, and you’re not wasting anyone’s time. They can work on other things, and if you need them, you just say their name. I’ve found that it’s what I spend my life doing. The Wolfram Alpha project is the most complicated project I’ve ever done. It’s remarkable for what it …Next Page »