Monthly Archives: March 2008

No More Desktops Out of A-Town

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Dell is shuttering it’s Parmer Lane facility, which employs approximately 900 people. The one great thing about making desktops in Austin was that you could get them delivered really quickly. Laptops haven’t been manufactured in Austin for a while now. It’s all part of the announced plan to reduce the workforce at Dell by 8,800 people.

Dell is one of the greatest startup stories to come out of Austin, and the talented “former Dell” folks have generated numerous startups of their own. As any fast-growing company will tell you, the growth rates can’t go on forever. There is also no escaping the fact that the world is flat. For a while, consumer technology was all the rage, but the Dell DJ wasn’t a huge hit, and the profit margins on Dell TV’s were slim. Dell is aggressively building their enterprise services business now, and is starting to look more like a diversified technology and services company along the lines of IBM and HP. Not bad role models, really.

This Week's Events

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If you haven’t seen it yet, we have an events calendar on the menubar which can also be accessed at http://www.austinstartup.com/calendar. It’s a Google Calendar which is public, so you can pull these events into your own Google Calendar, or with the new Outlook exchange feature you can pull these events into your Microsoft Outlook calendar.

Events This Week

  • Tuesday; Funding Sources for Early Stage Companies from 3:30 – 4:30 at the MCC Auditorium.
  • Thursday; Guerilla Marketing: Maximum Exposure with Minimal Resources from 11-1pm at the St. Ed’s PEC. Speakers include Sam Decker, CMO at Bazaarvoice and Eric Smith, President at Unwired Nation.

You can see more details on the calendar.

itzbig Deploys Pay for Performance Model

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Itzbig Logoitzbig has taken another step toward becoming the preferred destination for employers seeking qualified IT workers by introducing today a new, more results-oriented business model for employers. The new approach means that employers will only pay for Interested, Qualified and Available (IQA) candidates, a monumental shift from the way companies are used to recruiting candidates.

“Traditionally, employers have had to pay up front to list their job opportunities on a network,” said itzbig CEO Jim McGovern. “This model has become even more prevalent with the social networks entering the scene. Services like LinkedIn and others will typically charge you for access to their users.” Since taking the top job at itzbig, McGovern has expanded the company’s presence to the Bay Area and added brand-name clients.

“We are revolutionizing the way online recruiting works by aligning the value you receive with the value we provide you. With itzbig’s new Pay per IQA model, you can access our users and post as many jobs as you like for free, but you will only pay when you get results – when you find candidates who are Interested, Qualified and Available.”

The company also recently launched a new media campaign called Get Yourself Fired, which was created in conjunction with Austin-based Third Rail Creative.

Interesting Developments

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A few quick Friday notes…..

  1. Search for something in Austin on Google Maps, and check out that new “Street View” button in the upper right hand corner. As far as I can tell, the Google Maps cars were cruising around Austin in December, 2007.
  2. Is that new “People You May Know” feature in Facebook the most genius, evil, viral thing you’ve seen in a while?
  3. Isn’t twhirl awesome? I think it’s the first AIR app that I’ve left installed on my computer.
  4. Friendfeed is on fire. Could they do to Facebook what Facebook did to MySpace by being more open, transparent, operating at the edge, and being less evil?

UT Students Create Web Company Next Weekend

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The entrepreneurial spirit is in full force at the University of Texas at Austin, where a few dozen aspiring and serial entrepreneurs will design and launch a web startup company in just two and a half days as a part of the first-ever Venture Weekend. Leaders will emerge, ideas will be executed, and a business or two will launch by the end of the weekend.

“How crazy would it be to gather UT’s best and brightest innovators with one goal: to start a web-technology company in a weekend?” asks Alex Schliker, an second-year student and serial entrepreneur. “We started Venture Weekend to provide entrepreneurs with an exciting outlet for creativity. Venture weekend challenges the status quo of other entrepreneurial organizations that just talk-the-talk. If you want to execute a marketable innovation with an amazing team, Venture Weekend is for you.”

Currently sponsored by Hewlett Packard (HP), DFJ Mercury, NetQoS, and hosted by the Campus Entrepreneurship Opportunity (CEO), interest in Venture Weekend is growing dramatically with over 100 applicants and a few over 40 selected to partake in the weekend. Venture Weekend has attracted both graduate (PhD/Master’s candidates) and undergraduate students of majors in computer science, law, business, engineering, and others. Everyone will spend Friday evening through Sunday evening developing an innovative product, constructing a framework for an entity, and launching by Sunday at midnight.

The weekend is set for April 4th (evening), 5th, and 6th and students will probably remain at the event location, where an array of amenities will be provided. Participants could feasibly sleep at the location, as tons of pillows and blankets will be available.

Venture Weekend began when a handful of university students decided they wanted to take what they learned in the classroom and execute. While the event is the first of its kind at the university, members don’t think it will be the last.

ReachForce Launches Convert Product

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Reachforce LogoReachForce Inc., a worldwide provider of OnDemand software and data services for targeted lead generation, announced the general availability of ReachForce Convert, the company’s second Software-as-a Service (SaaS) solution. ReachForce Convert analyzes web visitor behavior and market segment patterns using predictive analytics to enable B2B marketers to proactively target the right companies based on website visit data.ReachForce Convert empowers marketers to define website visitor patterns of interest and identify market segment opportunities. By applying custom business rules to score web visitors based on their activity, marketers are able to determine if a web visitor is ready for sales follow up or if the lead needs additional marketing to become sales ready. By understanding the types of companies visiting and where these visitors are spending time on their sites, marketers are able to better target lead generation initiatives in order to convert passive visitors into true prospects using ReachForce’s role-based contact data services.

“So many marketing dollars are being spent on SEM, SEO, and PPC in effort to drive more web traffic, yet these initiatives are delivering a less than three percent conversion rate, which means over 97 percent of online marketing dollars are essentially unaccountable from a revenue perspective,” said Suaad Sait, ReachForce CEO. “ReachForce Convert enables marketers to identify the right target businesses based on website activity as well as proactively delivers the data services to pinpoint the right role-based contacts within these organizations.”

Interview with Guy Kawasaki (pt 3 of 3)

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Truemors and Alltop seem like fun little side projects for you.
My status with Garage is kind of an Entrepreneur In Residence position. This is something I always wanted to try, these kinds of things. With Truemors, popurls sent us a lot of traffic, and I took notice of that. I’m a big RSS feed user, but if my wife or kids asked me which are the best sports feeds, I’m not going to tell them to get a Google Reader account, then subscribe to the feed, go the page, subscribe to the feed, etc, etc, it’s just too complicated still for the average person. So I would say just go to sports.alltop.com. So the target is not people who use Google Reader, or PageFlakes, it’s the other 99% of the population.

You’re definitely going after the mass market.
That is our hope. We have the top 40 topics now, and they are as diverse as “religion” and “cute.” Cute.alltop.com is feed sites like www.icanhascheezburger.com. Or things with cute dogs, cats, or babies. One of the things I learned in my career is that you just never know. If you think you’ve created this great site that everyone will visit, you’ll find you get beat by a site that features cute dogs.

How many topics can you put on the page before it’s too much?
That will be an issue. Pretty soon we’ll just be another Google. We currently have food.alltop.com, but we could also do wine.alltop.com or beer.alltop.com. And there are 200M people interested in each one. We think people will not necessarily bookmark our home page, but instead they’re going to bookmark sports.alltop.com. Right now we have all sports together, but we could do nfl, nhl, and nba.alltop.com. Then we could do just spurs.alltop.com for San Antonio fans. The topic organization is definitely an issue.

You have an editorial responsibility to decide what categories to cover and how to organize.
It’s definitely not about the wisdom of the crowds. We may do a poll about the popularity of the feeds within each topic, but some of the value is that we have decided that these 10-20 feeds per topic are above the fold. We’re not a search engine. We’re more like Mahalo, although there is only 1 person making the decision. I have to say the Twitter community has been tremendously helpful in identifying the top sites.

What about that first site the gets dropped off? What about that backlash?
I hope we drop a site and it creates a controversy, because that means it matters to be on Alltop.

When you finally have to hire someone to run it as a real business, is that victory or defeat for you?
The beauty of alltop is that if it succeeds, as long as the servers are on and the feeds are coming in, we’re good. We could sell advertising. We could sell sponsored feeds. We could make the first row $10K per month.

The bar across the front is certainly an interesting part of the design.
People either love it or they hate it. Electric Pulp came up with the idea, and we liked it. The tagline says, we’ve got (topic name) covered, so it’s kind of a pun. We might put a close box on it. The good thing about a small startup is that we don’t have to do usability tests around it, we don’t have to get someone’s permission to create it or change it. We think it’s cool, so we leave it. If you don’t like it, use Google Reader.

Click Forensics Changes CEOs

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Click Forensics, the Austin-based company which creates software to help people battle click fraud which recently raised $10m from Sierra Ventures, Austin Ventures and Shasta Ventures, has announced that Paul Pellman has been named to the position of CEO.  In his new role, Pellman will oversee strategic company initiatives, operations, and key growth and business development activities. Tom Cuthbert, Click Forensics founder and current president and CEO, will continue in his role as president, focusing his time and energy on industry initiatives, marketing and business development activities.

“We’re excited to have someone of Paul’s caliber join the Click Forensics management team,” said Cuthbert. “At this important stage in our company’s lifecycle, we need seasoned leaders who can guide us as we continue to expand the company and its operations. Paul’s experience serving as CEO in the past and his time with industry leaders like Hoover’s and Lycos will prove invaluable in taking us to our next level of growth.”  The addition of Pellman, who most recently served as Entrepreneur in Residence at Austin Ventures and also served as Interim President of Hoover’s , should help Click Forensics capitalize on their recent string of good news.

According to Pellman, “Click Forensics understands that the problem of click fraud is just the tip of the iceberg.  The growing issue of poor traffic quality is an even bigger threat to the future success of online advertising. Tom and the rest of the management team have done an excellent job helping to raise visibility for this important issue. I look forward to working with them as we continue to press forward with making high quality traffic the standard in the search marketing world.”

BSG Alliance Raises $43 million Round

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BSG Alliance, Steve Papermaster’s Austin-based startup which has been very active in both acquisitions (here, here and here) and appointing high profile new board members, has reportedly raised nearly $43 million in Series B funding led by Oak Investment Partners, according to a regulatory filing. The company had previously raised $20 million from Foundation Capital, Hummer Winblad Venture Partners and Powershift Ventures.  Combine the 5 acquisitions the company has previously done, and the Board the company is assembling, and BSG appears headed for great things – maybe even a late 08, early 09 IPO?

Hat tip: PE Hub.