Poll Results

Pollresults
Last week we featured a poll to ask people what Austin company would be the next to file papers for an initial public offering (IPO) of their stock. "Someone Else" received the most votes with 31.6% of the vote, yet only one write-in was created for Site Controls, makers of Site-Command – a software platform for energy monitoring and management for retail, restaurants, and convenience stores.

HomeAway.com received 26.3% of the vote, leading all the listed companies.

We’re not quite sure what to make of this. Does this mean that 31.6% percent of the voters think Site Controls will be the next IPO, or did our voters just not bother to write in their opinion?

If you didn’t write yours down, please comment and share it with us!

Demand Response: Mark and Jarrett’s Excellent Debate

Cleantech Friday by Steve Guengerich

For anyone interested in cleantech – the industry, the companies, and even the underlying principles – you really have to put the Austin Cleantech Forums on your event calendar.  Clean Energy Incubator director, Joel Serface, made the issue of re-energizing the broad community of cleantech entrepreneurship in Central Texas one of his priorities when he came to the University of Texas.  The evening events have not disappointed, with the next one – on the grid-connected vehicle sure to be lively.

It was at the March 1 event, earlier in the year though, when some would consider a fairly unsexy subject spurred what I considered to be a fascinating mini-debate between 2 of the speakers on the “Global Trends” panel.  During this brief, but fairly “energized”  exchange between Sound Energy Partner’s Jarrett Carson and Austin Energy’s Mark Kapner, the men asserted their opinions about the future of demand response.

Demand response is the broad umbrella term for a more advanced system for managing energy use.  You can get excellent summaries of demand response from a venture investor perspective from Lux Research and from a Texas industry perspective from Good Company Associates.

In my mind, I would characterize Mark and Jarrett’s excellent debate along the lines of the following:  “Which is worth more:  $1 billion in savings or $1 billion in revenues?”  Of course, the obvious answer is:  it all depends…and that was exactly what the panelists were discussing.  In short, there still seems to be strong disagreement regarding just how much business and residential users of power will modify their behavior as they have more information about the price they pay for energy.

Austin Energy is no stranger to experimenting with demand response, with documented investments and results in pilots through partnerships with Comverge and Cellnet. However, Kapner’s point of view seemed to be that it is still too risky to presume that consumers will make great, fundamental changes in their behaviors, just because they have better information about their real-time costs for energy.  After all, he said, look at consumer’s use of gasoline in the U.S. during the past couple of years, when we experienced significant spikes in the price at the pump.  When people need gas, people buy gas, was more-or-less his point.  What makes us believe they won’t behave the same way when it comes to office or household energy consumption?

Carson was unconvinced.  In fact, he asserted that the potential for growth in the demand response industry was enormous, indirectly backing the position (at the time) of the National Resources Defense Council’s early 2007 research report by discussing investor community momentum behind the technology.

If you were an audience member at the March 1 event looking to leap into a cleantech venture and thinking about demand response, what did this mean to you?  On the one hand, good news:  there is investor interest in demand response, smart metering and that ilk.  For a city known for an extremely bright, ambitious software and services entrepreneurial eco-system, innovation in the cleantech industry segment of demand response would seem to be tailor-made for Austin.  On the other hand, bad news:  the largest buyer in the region and one of the most progressive in the country, Austin Energy, seems a bit ambivalent after spending real dollars on pilot demand response products and services.

And so, the debate will no doubt continue.  Add your voice; let us hear from you.  Is demand response hot or not?  Discuss; and, see you next week.

Famecast onto Season Three

Famecast, an AV backed company which we
described as “Like
American Idol online. Only with more categories than just pop singers. There is
spoken word, short film, comedy, and other "stages"
” has begun
the third season of its online talent contest.

According to the company, artists can upload their videos at
www.FameCast.com through Sept. 3-15.  FameCast plans on awarding $120,000
to deserving artists in this third season, and is on track to distribute nearly
$500,000 in prize money within its first year of inception.  Famecast also
announced the winners
of Season 2
, including two winners from the area
Franco B who won on the Hip-Hop stage and Brendon Walsh, on the Comedy stage.
However, since we last wrote about the company, the Alexa
traffic graph
hasn’t matched the buzz around the company…let’s hope the
third season is the charm. And, congratulations to Franco and
Brendon!

SXSW: Community Picks Panels

The folks at SXSW Interactive just announced the launch of it’s Panel Picker for the 2008 festival. Last year was the first year that SXSW allowed the community to pick which panel topics they were interested in. According to Hugh Forrest they have "about twice as many submissions to the Panel Picker this year" as they had last year.

AustinStartup will be liveblogging the event in 2008, which is emerging as a great launchpad and forum for Web 2.0 companies.

Q&A: FiveRuns

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Today we kickoff another weekly feature that we’re calling Q&A Wednesday. We start off with a Q&A with Dean Cruse, VP of Sales and Marketing at FiveRuns. Five Runs provides enterprise management for people developing in Ruby on Rails. The company is doing some tremendous things for the Ruby on Rails community.

Q: Even non-technical people are starting to hear more about Ruby on Rails. Why is it important to offer enterprise class management services to people interested in developing in Rails?

Rails is definitely hot. It’s easy to use and developers can be significantly more productive with it compared to other frameworks. And, while a lot of today’s more visible sites are built on Rails, more and more businesses are looking to adopt it for their applications as well. These organizations are looking for management tools to help them profile and tune their applications before taking them to production, and for ways to manage Rails applications once they’re live. Rails by itself doesn’t provide any way to instrument performance or manage applications – that’s where FiveRuns steps in with our application monitoring and management tools – we help take the risk out of developing, installing, and managing Rails applications. And, the community is eating it up.

Q: Tell us how FiveRuns got started, and how the venture financing came about?

FiveRuns was founded in 2005 and funded by Austin Ventures and Silverton Partners. Initially, the company focused on building a new breed of systems management software for small to medium sized businesses who were looking for lighter-weight, easier to use tools than what they could find from traditional vendors. We built the FiveRuns software on Ruby on Rails, and along the way discovered the need to provide management tools for the Rails framework. We brought in a fantastic team of Rails experts, systems management professionals and Internet software folks, and launched FiveRuns as the Rails Management Company last May at RailsConf. The response has been terrific.

Q: Many startups create advisory boards and hope to benefit from them. You’ve created an incredible Rails brain trust! What value has that brought to the company and your customers?

With any new development framework, it’s important to solicit the feedback of the community early on and make sure what you’re developing will hit the mark. This has been particularly true with Rails – it’s a close knit community with a very clear, opinionated view on how to do web development. We reached out to many of the Ruby on Rails thought leaders to ask for their feedback and much of that has gone into our product and future development plans. From the response we’ve seen so far, the community is definitely looking for solutions like FiveRuns is building.  Our advisory board adds a level of trust from the community that eases any new technology concerns that customers might have.

Q: What milestones or key moments have you had when you all said to yourselves, “We’ve really got something here!”?

Probably a few things – when we were able to attract the best of the Rails community as advisors and team members, it was clear we had something unique and valuable. That led to signing customers that are leading the way with Rails – from innovators like 37 Signals to hosting providers like Blue Box Group. This was also evident from the standing-room-only attendance we had at RailsConf when we launched RM-Manage, our rails application monitoring product. It was incredible to see the overwhelming interest from individual engineers, to web development  shops, to large organizations, all clamoring for new ways to manage their Rails applications.

Q: What can we look forward to in the future from FiveRuns?

We’re committed to the Rails market and are true believers in its future. We’ll continue to innovate around Rails management and introduce new products like our new, free Rails stack, RM-Install, that makes it easier to get productive on Rails.  We’re always looking for ways to give back to the Rails community, and by developing innovative solutions that make it easier to rollout and manage Rails applications, we hope to further its adoption and help our customers ride this exciting wave.

Luminary Micro closes $25 million round

Luminary_2
Another Austin-based
company with Jimmy Treybig on the Board of Directors has closed a large
financing
round. Treybig, who sits on
the board of Heliovolt, is also the Chairman of Luminary Micro . The company, which focuses on ARM Cortex-M3-based microcontrollers for the embedded and industrial
markets, announced today that it has closed a $25 million round lead by outside
investor Adams Street Partners of Chicago, Illinois. Additionally, Tom Berman, a Partner with
Adams Street Partners, has joined Luminary Micro’s Board of Directors.

 According to Luminary
Micro CEO, Jim Reinhart, the new infusion of capital will be used to “ensure
that the company can continue expansion of its efforts on all fronts." Luminary
Micro previously had raised $19 million in venture financings, as it closed
its first private funding of $5M in February 2005 with lead investor EXA
Ventures and raised an additional $14 million in a Series B financing which
closed on June 12, 2006 from New Enterprise Associates and ATA Ventures.  Adding a well-respected private equity firm such as Adams Street Partners is yet another sign of great things from this Company!

eZee Hiring and Moving into the ATI

eZee is an Austin-based mobile solutions startup that should be making a splash soon. The company was accepted into the Austin Technology Incubator and, according to the blog of CTO Enrique Ortiz, moved in last week. I would expect to see a demo, a launch, or some sort of presence from them at the upcoming Texas Wireless Summit.

eZee has a very experienced management team, led by John Sullivan who previously founded Outtask, Inc. which sold to Conur Technologies in January 2006 for $93M. CTO Enrique Ortiz is a highly experienced engineer who was a founding member of the Austin Wireless Alliance, and was previously at AGEA. The advisory board has an international brain trust with James Love (based in the UK) and Jeffrey Stern (based in Lichtenstein).

The company appears to be hiring and expanding. They are looking for experienced server developers, mobile developers, and quality assurance engineers.

ON Networks Adds Media Giant to Board

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ON Networks, which we wrote about here last month, just announced that media giant Allan Grafman has joined the board of directors. Grafman has been in the entertainment industry for 30 years, and was formerly the CFO of Hallmark Entertainment, and has held executive positions with Tribune and Capital Cities/ABC. This is a major deal for ON Networks, which has been rolling out new programming at an amazingly fast pace.

ON Networks is a relatively new startup company, and has raised $4M in funding from Austin Ventures and AT&T in November of 2006.

Poll: The Next Austin IPO

For those of you that read the blog in an RSS Reader, please check out the homepage and on the top right hand side you will see our poll for the week. We’d like to know who you think will be the next Austin IPO. Please cast your vote. If your answer is "None of the Above" then please add a comment to this entry tell everyone who you think it will be. We’ll post the results next week.

Staktek Makes Acquisition

Stak_3 Staktek,
the Austin-based publicly-traded company previously financed by Austin
Ventures, announced today that it will be acquiring Southland Micro Systems, an Irvine,
California-based provider of memory products and services.   Terms of
the transactions include a payment of $18 million in cash at closing and the
assumption of $5 million in debt; additionally, Southland stockholders will be
entitled to receive additional compensation pursuant to incentives related to
certain financial projections.

Staktek will seek to increase its profits by
focusing on deploying its newly acquired intellectual property to its top-tier
customers.  Wayne Lieberman, CEO and president of Staktek, was quoted as
saying "Our customers will gain greater selection of optimized
high-density, high-performance and thermally enhanced module solutions, greater
inventory flexibility and increased availability of Staktek IP from multiple
sources."

This is the first acquisition for
Staktek since going public in 2004.