Monthly Archives: October 2007

Small World Labs Partners with Inovis

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Smallworldlabs263Small World Labs announced a partnership today with Inovis in which the companies would work on an integration between Small World Labs social networking software and Inovis Business Community Management solutions. Inovis counts over 20,000 companies as customers.

"The addition of Small World Labs social networking platform in conjunction with the Inovis Business Community Management solution portfolio represents significant opportunity for businesses to collaborate with their trading partners," said Michael Wilson, co-founder and CEO of Small World Labs, based in Austin, Texas. "The ability to deploy an online community along side their current communication process provides an opportunity to create increased value for Inovis’ clients."

Google and PayPal Updates

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In an update to our earlier stories about Google and PayPal coming to Austin, PayPal officially opened it’s offices up on Parmer Lane last week. You can see all the open job postings over there courtesy of our job partner, Indeed.com.

GoogleaustinbadgeAs for Google, they’ve been looking for a "funky" location for their offices. The ABJ is reporting that they are close to signing up for the 2nd floor of the Scarborough building on 6th and Congress. It would be great to be walking distance from high quality caffiene, decent chow, and nightlife, but we all know Google will provide everything an engineer would ever need to live under their desk.

Austin Is IT!

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Did you know that the City of Austin has a focus on emerging technologies in Austin, and even an emerging technology team? They do, and it’s great to see the city looking at some cool emerging technologies, and even evaluating how they might be used by the city.

www.austinisit.org

We’re excited that the website has linked here to AustinStartup as a news and events resource.

Austin Startups Raising Big Cash

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According to the Quarterly Venture Capital Report released this week by
Ernst & Young LLP and Dow Jones VentureOne, Austin companies are raising money at a clip not seen since 2001.  During the third quarter of 2007, 19 companies raised almost $220 million.  While this amount is up 4% from last year’s third quarter, the results may be a bit skewed, seeing how three companies raised over $120 million of this quarters funds (Heliovolt, Luminary Micro and LDR Spine).  On a national
level, U.S. companies received venture financings of $7.1 billion through 887 deals, for an average of just over $8 million per financing.

In the regional rankings,
Texas is back to ranking 4th, having had 39 companies raise $386 million over the quarter.  This is much improved after the state had slipped to 8th among regions raising venture money, behind
stalwarts Bay Area and Southern Cal and 5 others (New England, New York
Metro, Washington State, Potomac and Colorado) in the second quarter.  Regionaltotalsq307_2
However, for the year, Texas is still 8th, with just over $1 billion in venture funding raised, and only $30 million ahead of the 9th place Midwest.

It is also interesting to see that Austin is in line with the national trend.  Nationally, software and life sciences are the top two sectors, with clean-tech increasing to $844 million in investment, an 80 percent increase
compared to the second quarter of the year. For Austin, always strong in software and semi-conductors, it is great to see a burgeoning life science sector to complement our strong, and getting stronger, clean tech sector.

Wireless Summit: eZee and NFC

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I had a chance to listed to eZee executive Enrique Ortiz and John Sullivan talk about the future of Near Field Communicatiaons (NFC). It’s the technology behind the Speedpass at the gas station, and Wells Fargo’s new mobile payment pilot. You get your device (smart card, cellphone) within a few millimeters of the NFC reader, and it transmits your payment information to the device immediately. No need for a signature, or a PIN number. It’s a cool technology, but according to eZee executives the U.S. is far behind other countries in the adoption of this technology. In fact there are only 2 cellphones on the market right now (both from Nokia) that even have this feature.

According to John Sullivan, the holy grail of feature sets would be to wave your cellphone at the point-of-sale reader, and then choose from a menu on your cellphone how you want to pay for the transaction (credit account, bank account). With a few million of these around, who needs to carry cash anymore?

What I found particularly interesting was the brief yet vague references that Ortiz and Sullivan made regarding the strategic direction of eZee. They mentioned that NFC payments are cool, but there are many companies going after that market. However, they were interested in the ways in which consumers might use e-commerce and NFC together. Sullivan also mentioned that they had great relationships with the big box retailers. Hmmm…..

Heliovolt Ads $24M

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HelioVolt is burning up the newswires these days. They recently received tax incentives from the City of Austin, and now they’ve added $24M to their round, bringing the total round to over $100M. This additive cash came from Sequel Venture Partners, Noventi Ventures, and Passport Capital.

So what happened here? Kind of odd, right? We have no inside knowledge of the deal, but if you’ve shopped the deal to a lot of VC firms, some of them aren’t going to get a bite of the deal. So when you make your picks and take down your money, a few get left in the cold. If they come back really hard, and perhaps give you better deal terms then you might be inclined to give them a taste. The round at first saw money from Morgan Stanley, NEA, and some others. Perhaps Sequel, Noventi, and Passport really wanted in the deal at this level and sweetened the offer. It happens.

A Whole New Market

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Editorial by Bryan Menell

I’m not exactly an economist, but I’ve recently noticed some innovations that I think are really brilliant. The definition of a market price is whatever a willing buyer will pay a willing seller. But what about prices that are kind of on the fringe of the market. Perhaps a somewhat willing seller, or I could call it a conditional seller? There have been web concepts with conditional buyers before, for example when buyers are willing to buy when a good reaches a specific price. But I think this conditional seller thing is rather new.

There are two web sites out there today that illustrate this point.

  • Zillow.com is one of many new breed online real estate web sites. It will help you estimate the market value of your property, the accuracy of which is a topic of debate. From that standpoint it’s not terribly remarkable. Zillow.com’s conditional selling mechanism is called Make Me Move. They call it "that magical number you just can’t refuse." You set your number on the website (without technically listing your house for sale), and buyers come to you if they’re serious.
  • iTaggit.com is an Austin-based company that allows you to organize and manage your collections. I have to admit, I have a pretty good collection of Star Trek Xmas ornaments. When you list your items, you can enter what iTaggit calls the Parting Price. So it’s not really for sale, but for a certain price I would be willing to part with my item(s).

It is a kind of new market in a way, one that was previously invisible. It would be interesting to hear from somebody who is schooled in economics discuss what this means from an economics perspective. Either way, these two companies have created a whole new market that didn’t exist before.

eVapt; Operational Solutions for SaaS

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Evapt175
The new kids in the Austin Technology Incubator, eVapt is trying to make life for companies that provide software as a service (SaaS) much easier. For instance if you’re readying your SaaS offering, you’ve got to think about your contract with your users. You will need to create a contract, and think about things like charging via flat fee, user-based fees, or usage models. eVapt also provides a dashboard for the various services it provides.

These folks are new, young, and emerging. It doesn’t appear that they’ve launched anything yet, but we’re looking forward to seeing some interesting things!

Patton Medical Lands $15M

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Patton Medical makes a relatively simple device for frequent injection users like diabetics. If you need many injections in a day, your injection sites become bruised. Patton’s device basically creates a needle stick once, which allows multiple drug deliveries over the next 72 hours through a flexible tube. The website has some great diagrams and graphics.

The release says the investors are anonymous, but we’ll see if we can do some research on that.

Silverton Partners

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Silvertonparty
Silverton Partners threw a fantastic shindig last night for friends of the company. For those of you not familiar with Silverton, the company is the investment and philanthropic arm of former Austin Ventures partner Bill Wood. Silverton isn’t a traditional type of VC. As a matter of fact, they don’t even have a website that talks about their portfolio, philosophy, team, etc. The only website relates to Silverton’s philanthropic activities. The firm is quietly investing in some really great companies. For instance we’ve previously written about Boundless Network, which is a Silverton portfolio company.

As I drove up to their offices, I was amazed to see that they blocked off the street in front of their downtown office to put up a party tent (click the picture for a bigger view from my iPhone). Incredible food was catered by Central Market and Group Fantasma kept the music going throughout the night. If I didn’t have to be productive the next day, I would have enjoyed many more of the pomegranite mojito’s than I did. To Bill, Morgan, Charley, and the entire Silverton team……great party!