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February 28, 2006
MySQL Buys Out Netfrastructure
MySQL's CEO recently let it be know that he had spurned a buy-out offer from Oracle, proclaiming that MySQL was destined to be a very large company without being bought. Today the company bought Manchester, MA-based Netfrastructure, which sells server software for Web applications.
As part of the deal, MySQL brings aboard database pioneer Jim Starkey. Starkey created InterBase, a database that became part of Borland International.
Read - MySQL Has Bought Netfrastructure (ChannelWeb
Posted at 05:29 PM | Posted to Business software | TrackBack | Permalink
CoComment tracking tech for weblogs to be spun out of Swisscom
Last week the alarm:clock euro reported the launch of a new weblog comment tracking service called coComment, which came out of the labs of Swisscom. In the meantime, we confirmed in an interview with project management team from Swisscom that it is likely to be spun out into a stand-alone company.
Laurent Haug is one of of the co-creators of coComment
The a:c euro interviewed the people behind coComment, project leader Nicolas Dengler of Swisscom Innovations; Laurent Haug, an independent consultant, and Marco Chong of Swisscom Business Development.
"The coComment project was financed by Swisscom as one of a number of ventures and business development projects the company is making to explore emerging technologies and business models. At the same time, we're happy to help enhance Swisscom's image as a supporter of innovation" said Chong, adding that CoComment has "nothing to do with the firm's Bluwin consumer portal, or the blog platform running on Bluwin".
That means the costs of the development are not coming out a Swisscom business line, but from a corporate investment-venture budget.
The people behind CoComment are confident about commercialization prospects due to the feedback from early adopters. "CoComment tracks the conversation. Users can track their own comments and they can keep track of others. It has a dedicated user base and it provides a value to these users," said Haug.
While firms like Technorati can track the number of links to a blog, and others like Digg, can provide a window into the popularity of posts, the other important driver of blog popularity, the so-called conversation, has few support tools. In many weblogs the comments made by readers are often as valuable as the original post.
The plan now is to create an independent company, and eventually seek outside investors. "We look at Technorati as an example of the kind of business that can be built for the blogging community. And we are working on the business model. While adverstising is an obvious possibility, one thing we can say is that we won't be adding advertising directly to users comments."
Chong said that Swisscom is currently the sole owner of coComment, but that it does not see this as a “potential core business” in the future. It is examining the "potential to generate a cash return on its investment”. He added: “If a spinout is pursued, it is likely that Swisscom would maintain an equity stake in the company."
Posted at 05:23 PM | Posted to Web 2.0 | TrackBack | Permalink
Betfair’s valuation up with Softbank investment
Privately-owned Betfair, a six-year old online betting exchange, is now valued at £1.5B ($2.6B), according to news coming out of London today.
Softbank, the Japanese investment company, has agreed to buy up to 23 percent of online onling gambling platform, the Sporting Exchange Ltd., the company behind Betfair, according to a Reuters report today.
Betfair enables gamblers to make or take bets on sporting and racing events. It charges a commission on each wager.
There was no disclosure on the amount paid for the stake. However, Reuters cites the Financial Times which said the price paid per share was £13, giving Betfair a valuation of £1.5B. The venture came close to a flotation last year with a valuation of £1B, according to the same report.
Betfair's press release suggests that Softbank is buying out shares of existing investors, but it is not very explicit.The firm has a long list of shareholders as it was formed as a result of merging in 2001 two companies: Betfair, a bootstrapped company (whose founders still lead the venture), and Flutter, a venture-backed startup, which raised £27m from a syndicate of investors that included Benchmark Capital Europe, Index Ventures, UBS Capital and JP Morgan Partners.
Index Ventures says that the exchange “delivers consistently better odds than traditional bookmakers”.
Read - Softbank to buy stake in Sporting Exchange (Reuters)
Posted at 03:34 PM | Posted to Venture Capital | TrackBack | Permalink
King.com goes from cold to hot
Over at sister site the alarm:clock we are saying it is good to be King.com as the firm reports quick growth with casual gaming small-stakes betting.
We’ve been following Midasplayer.com Ltd, the company behind King.com, for a couple of years now and note the changing fortune of founders Riccardo Zacconi (pictured here) and Toby Rowland.
The two had a hard time raising early stage financing in 2003, despite having connections to the rich and famous in London. We understand that Rowland's father was a high-profile entrepreneur and Zacconi had worked as an EIR at Benchmark Capital Europe.
What is more, they both had experience with consumer-oriented online services. During the bubble, Rowland had founded Clickmango, a high-profile dotcom flop. After that he backed and worked at udate.com, which was acquired by USA Interactive in late 2002 for $150M. Zacconi had been a VP of sales at udate when the two had the idea for the new business.
When we were researching an article about VC investment trends the other day, we had a look at Ricardo Zacconi’s OpenBC profile and had to smile at the number of investment bankers, executives at places like Google, Excite, Vodafone, as well as venture capitalists, in his contacts list.
About a year ago, several months before the firm raised €34M from Apax Partners, a private equity and late stage venture investor, and Index Venture, we asked the founders to send us some VC quotes circa 2003. Here is one:
What a cold, Internet start-up? Who gave you this number?”
And here is another one:
VC: Could you put £5m to work this year?’
Entrepreneur: No
VC: Do you know anyone who can?’
Toby Rowland, picture here, said some things at the time that fit in with what the a:c and others have been saying more recently about VCs being in a bind these days.
Overall, my feeling is that VC funds are so big now that they are forced to look for companies with existing cashflow, and huge opportunities. Of course, that puts them into competition w/ private equity who tend to be more aggressive about getting deals.
Read - VCs in a no-win bind
Read - It's Good To Be King.Com
Posted at 07:08 AM | Posted to Online services | Venture Capital | TrackBack | Permalink
February 27, 2006
Nanotech expert says don't invest in nanotech
Don't call us, we'll call you, is the message that VCs are giving nanotechnology entrepreneurs. And rightly so, says Tim Harper of Cientifica in a new report his firm will published today.
One of the best known images from the nanotech hype era (circa 2002) is the IBM millipede project, a nanotech inspired storage device. Three years later, IBM showed a prototype of the storage chip.
In this latest paper, Harper, who makes a living advising institutions, businesses, and VCs on nanotech investment, delivers the good news: some $375M was invested last year in nanotech, almost double the previous year. And then the bad news, the total is only 1/700th of the amount VCs in the US invested in technology ventures. And more bad news, much of the money invested so far is locked up inside illiquid companies with little short term chance of an exit, according to Harper.
In case you don’t recognize his name, Harper was a frequent speaker at industry and investment confabs during the nanotech hype a few years ago. It was a time when experts, Harper included, were publishing target market estimates for molecular science innovators that had as many zeros in them as you get when you compare a nanometer to a kilometer (1 kilometer contains 1,000,000,000,000 nanometers).
Harper expects investors this year “to continue to lose patience with first mover nanotech companies”, leading to “rich pickings for patent trolls and companies looking to acquire IP in fire sales", as well a slew of attempted trade sales and IPOs.
His advice? Don’t invest in nanotech per se, move up the value chain.
It is becoming increasingly clear to investors that the returns from nanotech will not come from companies producing nano materials such as carbon nanotubes, but from companies using them to create new paradigms in existing major markets such as health, energy, food and textiles. .
If there are any small tech entrepreneurs reading this, you can take some consolation in the fact that the VCs and experts are saying that nanotech is over. It means that the market is in the trough phase. What follows the hype is the disappointment trough. Then comes the real growth and when that happens, the VCs will be back as if they'd never been gone.
Remember, it was just three or four years ago that VCs were saying similar things to people like Niklas Zennstrom, co-founder of Skype, or Riccardo Zacconi, co-founder of online casual gaming betting platform King.com, when they were trying to find early stage funding. In the meantime, the consumer Internet market took off, VCs changed their tune.
Everybody knows what happened with Skype, and when King.com (formerly Midas Player) finally did raise its first round of venture capital, it was able to sell a minority stake to Apax Partners for a whopping €34M.
Besides, not everyone thinks nanotech is over. We just had news from the organizers of the NanoEurope fair in Eastern Switzerland and they are expecting the biggest event ever this fall, and have added a new exhibition to support industrial and commercial adopters.
Read - Paper to published on Monday (cientifica)
Posted at 09:00 AM | Posted to Venture Capital | TrackBack | Permalink
Berlin's Magix Prepares 100M+ Euro IPO
The German multimedia software publisher Magix is expected to hold a significant IPO in the next couple of months. Reuters reports that the firm was expected to float at the end of March or the start of April and sell shares worth 100M to 130M euros ($119-155M).Dresdner Kleinwort Wasserstein and Cazenove are the banks that would manage the deal.
Magix was founded way back in 1984 and sells shrinkwapped software to retail consumers who want to send photos or other multimedia files to friends. The company boasts tennis great Boris Becker as an advertising partner.
Read - Germany's Magix considers IPO in first-half 2006 (Reuters)
Posted at 06:55 AM | Posted to Digital imaging | TrackBack | Permalink
Vodafone' flash mobs to view secret gigs
The Register has an update today on interactive TV goings on in the UK market. The a:c euro notes that Vodafone has joined forces with Channel 4 for a series of televised flashmob concerts.
Over the next couple of months, Vodafone will text random people with details of the secret gigs, said to feature "international artists of the calibre of Justin Timberlake and Christina Aguilera". The results will be aired live on C4 or E4 in a slot designated 'TBA' in the schedules. So, what if no-one turns up to the concerts? That'd be TV gold.
Our reaction to the Vodafone item? We could imagine a lot of people showing up at a free Justin Timberlake concert, if you paid them.
A French website, Parismobs, posts pics of a flashmob lying on the ground for no apparent reason and photographed by Martin Graham. We note there has not been much activity on the site since 2004.
Entrepreneurial types might want to create a new business, offering Vodafone and the like, a guaranteed crowd or mob. It is not that much different from PR firms running word of mouth campaigns, and infiltrating the blogoshpere to pay people to do viral marketing, is it? A recent example of which is highlighted in an Ars Technica story about Microsoft’s new Origami PC, while the Village Voice tries to get a grip on the ethics of it all.
Read - Sugar wins the ratings war (The Register)
Read . Origami and Microsoft (Ars Technica)
Read - Morals get fuzzy as biz tries to embrace the blog world (Village Voice)
Posted at 06:31 AM | Posted to Interactive TV | TrackBack | Permalink
Sharkle = YouTube - An Audience
Weblogs Inc.'s Jason Calacanis recently dismissed YouTube, writing that it is not a defensible business and that he could hire a couple of tech goons to re-create You Tube's functionality. It's one thing to create a functionality and another to get traffic.
With a similar idea as YouTube are Flycast founders Trevor Wright and Brian Kropp whose, new startup Sharkle is based in Marin County, CA and was formed in 2004. The site has a professional appearance and clearly a lot of work has gone into it, so why no traffic?
Kropp & Compnay sold Flycast to CMGi in 2000 for $500M. With Sharkle, they expect the company to become cash flow positive this summer. Revenue is based on site advertising -- including video advertising before and after each video. Sharkle is also matching sponsors with users who create their own commercials for a product. They'll also market Sharkle to newspaper sites for classified advertising or auction sites for use of video to display items for sale.
Sharkle's Traffic Even Lags Way Behind The Video Blog RocketBoom
Read - Sharkle.com lets participants post videos for free (Cincinatti Business Courier)
Posted at 05:46 AM | Posted to Media | TrackBack | Permalink
VNU Buys Silicon.fr
We learned via Kelblog that London-based VNU Business Media Europe has taken a majority stake in Silicon.fr for an undisclosed amount. The deal comes a few weeks after it bought The Inquirer, a London-based IT online news tabloid.
Silicon.fr has 100K registered users and has been in business since 2000. VNU itself is the subject of a private equity feeding frenzy with buyout firms currently vying to aquire the company.
Read - VNU BME prend une part majoritaire dans Silicon.fr (VNU press release)
Posted at 05:32 AM | Posted to Media | TrackBack | Permalink
February 26, 2006
Locate-me startup, Plazes, popular with techies, gets funded
Plazes is being hailed as the next big European Web 2.0 development in the German press these days and it has attracted a lot of attention from VCs, alpha geeks, web wizards, and certain parts of the blogosphere.
We held off on reporting about it until a) we could confirm that there was a startup called Plazes and that it is not just a side project from Berlin’s Gate5 anymore, and b) we could interview its founder, which we did on Friday.
We can now report that Plazes is a Swiss company, founded in December 2005. Its R&D is in Berlin. It employs 5 and it has tapped Swiss business angels for seed funding. "We are fully funded until the end of the year," said Plazes' co-founder Felix Petersen.
If you haven’t heard of Plazes, it is a website that users exploit to locate friends, colleagues, and wireless hotspots.
The user downloads a client which sends the users' location back to the Plazes database and that spot or location can then be searched, mapped and located by other registered users. It can also be edited with photo, text descriptions, and other bits of info.
There is no business model to talk about for the time being. But Petersen told us that the management team has a few ideas and he’s not disclosing them yet, particularly to journalists.
Who can blame him, with this type of application being relatively easy copy, the moment the firm states a business model, it will likely find itself with some new competitors. One thing it won’t be is an ads-based sales model, said Petersen.
Plazes traffic is on a growth curve, according to Alexa, but the founder is not looking to monetize eyeballs and clicks.
Besides, even if Plazes wanted to generate sales via targeted ads based on location of users, none of the major ads networks, Adsense or Overture, are supporting local search with kind of granualrity Petersen believes would work well with an application like Plazes.
In meantime, the firm’s five employees are working on much-needed improvements of the user interface, adding mobile location ID, and establishing business partnerships with other social networking type companies, mobile network operators, and city guide publishers.
Plazes is mainly used by techie types inside R&D and technology companies in the US, according to Peteresen. Your a:c euro had a hard time getting her client software to identify here location, had to do it manually, and also found the workflow difficult to understand, but then again your reporter is a long way from being an alpha anything let alone an alpha geek.
Plazes fits into the location-based software and services market, which so far has proven to be an elusive one to exploit. A lot of companies have tried to offer the underlying technology as well as applications that sit on top, but so far none have been terribly successful. The only well established businesses that we can think of in this market niche are those that support in-car navigation using geodata and satellite positioning.
In other words, it is way too early in the Plazes development to predict whether or not its special take on this untapped market will be successful, but we’ll be keeping an eye on it.
Posted at 03:10 PM | Posted to Venture Capital | Web 2.0 | TrackBack | Permalink
February 24, 2006
Meetic acquires Dutch dating site
Neteco reports that Meetic is spending some of its IPO money by acquiring Lexa.nl for €11.5M from SKMG. The online journal says that Lexa had 30.000 customers and sales of €4M. This is the French firm's second acquisition since going public.
Read- Meetic rachète le site de rencontres Lexa.nl
Posted at 05:16 PM | Posted to eCommerce | TrackBack | Permalink
Cellphone recycling startups find growth
Over at the Red Herring is a feature story about ReCellular describing the US company's mobilephone recycling business. It reminded us of Fonebak in the UK, which raised £27M in 2004 from Bank of Scotland and subsequently floated on the AIM, the junior market in London in 2005.
Fonebak works with charities, retailers, and businesses to collect and recycle mobilephones in Eruope
Within two years of its launch in 2002, Fonebak had sales of £27 million and it had some 200 people working at plants in UK and Romania, as well as sales office in Belgium, France, and Spain. Last year its sales reached £38M with £2.5m pre-tax profit.
Read - Old phones ring up new profits (Red Herring)
Posted at 03:32 PM | Posted to Wireless | TrackBack | Permalink
Google gaining ground, local portals at risk?
Yesterday we wrote about Swisscom’s investment in a new comment tracking service for bloggers and wondered about the strategy. In the meantime, several readers pointed out that the telco does have a consumer portal, Bluwin, and it also offers blogging, a service it calls BlueBlog, which is powered by Kaywa, a Swiss startup blogging platform.
Indpendent of the research we've been doing into coComment and Swisscom, we took a look at Bluwin. Sure enough, Bluwin is indeed consumer oriented and It's a highly trafficked website. We confirmed that with a test of its traffic trend report in Alexa.
But Bluwin is losing ground to Google.ch and Microsoft in Switzerland, MSN.ch site, is faring even worse, as the Alexa chart illustrates.
The Alexa results got us thinking about Google's dominance in the online market. It's a popular theme in the tech trade press and blogosphere. Bluwin uses Google AdSense for contextual search advertising. That means it generates revenues from Google, while helping Google to earn more money via search advertising in the Swiss market.
We've written about this kind of thing occurring as being a market opportunity for startups like Ads-Click. So we turned to Pascal Rossini, CEO of Ads-Click, and asked him if Bluwin has enough traffic to create its own ad network. He said "yes" and that if Swisscom’s Bluwin used his firm’s software, it could effectively cut Google out of the equation, managing the relationship with advertisers under its own brand.
He said that Bluewin has its own sales force at its Yellow Pages unit called Directories.ch, and it also uses PubliGroup, an ad space sales agency for Swiss media and publishers.
So why doesn’t Rossini sell Bluwin on the idea? He told us that the firm did make a pitch when it was was at an early stage, and the response was: get a few more clients and then call us again. With the recent signing of big clients in Europe, Japan, North America and Australia, it might be time for them to get back in touch with Bluewin.
Rossini said that he will and that he thinks that the “independence and survival of the Bluwin portal might be at stake”. It would be interesting to hear from European portal owners and local ad sales agencies to find out if they see things the same way.
Posted at 01:33 PM | Posted to Web 2.0 | TrackBack | Permalink
Mobile network optimizers - roll ‘em up, roll ‘em up
Consolidation in the European mobile networking sector seems to be underway, at least among businesses whose products enable cellphone companies to save money by optimizing equipment, software, and service offerings. This is a different part of the supply chain than the M&A taking place in the mobile content and application end of the market. We think the entry of private equity investors, as opposed to venture capital investors, are driving the rollups.
Companies that develop software like this ...
As well as those that can make diagrams like this and then translate it into cost-saving for cellcos are being acquired.
Five, mainly small-sized, deals in the segment have been announced so far this year, include Tietonator’s acquisition of Sofnetix, a Finnish UK-based wireless and mobilephone software developer (this is the 12th small acquisition by one of Europe’s largest IT companies in the past 14 months or so).
Also announced yesterday, Actix Ltd , a mobile network engineering firm, acquired Radioplan GmbH, a Dresden, Germany-based provider of automated network optimization software. It is spending some the new capital it raised recently. According to PE Week, Summit Partners led a £40M round of investment in Actix last year.
Last week, Mach, which is backed by private equity investors, acquired End2End Networks. Esmertec, a Java for mobilephones company acquired Cellicium, which makes self-service apps for mobilephone customers. It saves cellcos money in administering client services.
And in January, Spirent Communications acquired SwissQual for its network voice and data testing technologies for $70M.
With other companies in this niche of the market, such as Anam, Apertio and Aircom having recently raised large rounds, it is likely we see a few more such transactions this year. Both Aircom and Anam have private equity backers and PE strategies tend to include rollups as way to add value to the venture.
Read - Actix acquires Radioplan (3G UK)
Read - Airwide pulls private equity (alarm:clock euro)
Read -Esmertec acquisitions (alarm:clock euro)
Posted at 06:19 AM | Posted to Wireless | TrackBack | Permalink
February 23, 2006
A European rival for NYSE and Nasdaq?
An AP story today reports that the German stock exchange, Deutsche Börse, and Euronext are coming closer to combining the two exchanges, although nothing definitive is close at hand. Not too long ago, it looked like the London and German stock exchanges would combine. But that one is off the table now, apparently.
The bull and bear in Frankfurt at the Deutsche Börse
The news may excite European VCs and their potential limited partners who have bemoaned the fact that one of the weakness in their exit strategy is the fact that Europe does not have a single stock exchange, a European equivalent of NASDAQ. The theory goes that a single exchange would give smaller tech company stocks better liquidity than they have in fragmented public market.
Having said that, the reception the NASDAQ has been giving to VC-backed tech companies lately might have them doing a re-think about this one.
Read - Euronext favoured (AP)
Posted at 03:03 PM | Posted to Venture Capital | TrackBack | Permalink
VCs warming to Czech entrepreneurs
We don’t hear as much as we'd like to about startups in Eastern Europe, but The Prague Post today has an article on VC-backed Systinet which was acquired Mercury Interactive earlier this year for $105M.
The firm had raised about $23M since founding in 2000 and it was not yet profitable (Mercury said the acquisition would be dilutive to earnings in 2006 and 2007). Its early stage venture backer, 3TS, seemed satisfied with the mulitple, calling the exit "successful" in its news section.
3TS recently raised a new fund to continue investing in the region, so we might be hearing a bit more soon.
The Czeck Republic got itself a logo to mark joining the European Union.
Read - Businesses starting to tap into equity investor financing
Posted at 02:48 PM | Posted to Venture Capital | TrackBack | Permalink
Swisscom’s non-profit service for bloggers
Switzerland’s largest telecommunications operator, Swisscom, officially launched a weblog comment tracking service today called coComment. The press release was full of quotations from famous bloggers praising it.
But only one clue is offered as to why Swisscom financed the infrastructure and the 12 man team that developed coComment:
Swisscom Innovations [one of the telco’s R&D units] is creating order on the Internet with its web service coComment, which enables users to manage personal entries in their Internet journals (blogs) in a centralised and transparent manner.
That sounds nice but it also sounds like a PR from a non-profit company. And while we have no doubt that the tool is useful and we note that it is integrated with many of the major blogging platforms, as well as Flickr, something not mentioned in the PR, we are somewhat puzzled by Swisscom's investment.
It would have made sense if a Google, Yahoo, or even Technorati had financed such a project as it fits their core business, and they could serve up ads on coComment to get a return on investment.
But this is a telco that does not have a consumer-oriented portal, nor does it offer a blog publishing platform.
coComment has an entry screen that will be familiar for frequent users of Web 2.0 services
Is this an aberration due the Swiss market's lack of early stage venture capital? In another location, would this have been an independent startup with plans to build up traffic, serve ads, and launch affiliate marketing programs to generate sales from registered users? The Bitflux blog also mulls Swisscom's strategy (See link below).
We have contacted both coComment and Swisscom and will post if we find out anything further.
Read - CoComment and Swisscom (Bitflux blog)
Read - coComment from Swisscom innovation for bloggers(Swisscom)
Posted at 01:59 PM | Posted to Web 2.0 | TrackBack | Permalink
February 22, 2006
Money For De Nuo New Thing
The Paris-based advertising and creative agency Publicis has set up a new unit to advise big name brands on tapping into new web digital media properties. The unit is called DeNuo. Normally, the a:c euro would not cover such news but it has a venture capital angle to it and it could be the beginning of some new sources of ad revenues for video and TV-on-the Net startups.
DeNuo will not only work with startups like Brightcove (tv broadcasts on the net) and Shadow TV (create and distribute videos for streaming) in the US, it will have some capital available to invest in such firms, according to a report in Le Monde today. (No mention of investing in European ventures.)
With Publicis new unit active in the market, it could mean that GM, Coca Cola, and other big names will be spending some of their ad budgets on Internet TV and video streaming sites, which has to be good news for startups in these niches. Who knows, maybe even YouTube will get a business model out of it.
Read - Publicis investit les novelles technologies (Le Monde)
Read YouTube is not a real business (Jason Calcanis blog)
Posted at 04:38 PM | Posted to Venture Capital | Web 2.0 | TrackBack | Permalink
France's imaging wizardry pulls VC cash
Three French startups that specialize in digital compression and imaging technology have been funded in the past couple of weeks.
Are the VCs backing these ventures all hoping that French technology giant, Thomson, will soon be back in the market to buy up some more pieces of technology to support its morph from a television manufacturer into a broadcast and digital video giant? Last year it made a few VCs happy with its €100M (estimated) acquisition of Inventel and its buy of Cirpack.
We don't know the answer to that one, but we do know a bit about the recent investment activity. Let It Wave, a startup pushing a proprietary video compression technology, raised € 6M from iSource Gestion and Iris Capital this month, Dxo raised $10M in expansion capital to develop its photo enhancing software, and Ateme, a supplier of standards-based video compression tech raised €4M from Xange and Ventech.
Let It Wave was founded in 2001 by four mathematician founders (all from the same French polytechnic or university) to sell their video and image enhancement software and services to security, defence, seismic imaging, satellite imaging and medical imaging manufacturers . In the past, the firm positioned its product as a better but proprietary alternative to JPEG and JPEG 2000 standards. The VCs became interested when they realized that the technology could also be applied to a much larger market, the emerging high definition television (HDTV) broadcast market.
Let It Wave is going to use the capital to for product development.
UPDATE : We were wrong in our original description of Let it Wave's current products. Please see below for a correction. Our original assessment, in italics below, is also wrong as a result.
We've seen quite a few startups in this part of Europe come out with non-standard technologies for video imaging only to end up squeezed into a tiny niche within the much larger video market. It is not going to be easy pushing a non-standard video format on its own.
Correction:
"We do not offer video compression," said Alban d'Halluin, VP Marketing, in an email to the a:c euro. "It is true that in the past, Let It Wave developed image compression technology for ID photos, but our products for the HDTV market are chips that perform video super-resolution scaling," he said.
In other words, the chips perform a conversion from SD (e.g. 720x486 pixel images) to HD (e.g. 1280x720 pixel images) using deinterlacing and scaling algorithms.
Let It Wave is not going to use the capital to develop codecs, as we wrote, it is concentrating on developing chips that perform the conversion of SD sequences to HD, and with no need for compression or codec technology.
"Our chips will convert a decoded raw SD video stream into a raw HD video stream. Both input and output streams are raw uncompressed video," said Halluin.
The idea being that the chips can then be integrated into a TV chipset or into a broadcast box. "Every single flat screen TV has such a functionality included as flat screen TVs cannot display interlaced content and require a conversion to progressive scan and a scaling to the panel resolution.... We provide a finally good enough quality to manufactueres who have been seeking for such solutions for years and were compelled to use poor quality solutions," said Halluin
For small size TVs, there is a "single-chip" architecture, i.e. a single chip performs MPEG decoding, video processing (deinterlacing, scaling, enhancement) and panel control. For mid-range and high-end TVs, very often we see a multi chip architecture: one chip for decoding, a high quality video-processing chip (like ours) a panel control chipset. Then it is always a trade-off between quality and price.
Haluin added a comment on competitors too:
We have direct competitors who provide scaling and deinterlacing chips: Genesis (the famous DCDi by Faroudja chip), Gennum, Silicon Optix are the most famous. All these chips perform the same function: they take a raw video stream and output it at any specified resolution and any scan mode. They differ by their price (Let It Wave will offer a much lower one) and by the visual quality of the output. On that point, we offer a breakthrough technology (bandlet-based motion compensation techniques) which results are far better according to all the benchmarks made by broadcasters and industry leaders.
Wavelets are used in JPEG.2000 image compression and decoding does, while Fourier/Cosine transforms are used in JPEG image compression standard. Let It Wave developed the bandelets transform.
Read - DXO financing round (the a:c euro)
Read - Let It Wave financing round (Press Release)
Posted at 04:15 PM | Posted to Digital imaging | Venture Capital | TrackBack | Permalink
Wrestlemania and Web 2.0
We’ve been wrestling with some of the Web 2.0 corporate communiqués, trying to figure out which new launch is in fact a real business. After reading a whitepaper on the topic, published by a trans-Atlantic corporate finance boutique, we now know why it is so challenging.
An investment banking firm says that Web 2.0 is not unlike latenight wrestling: part hype, part marketing jargon, and part reality.
"We view Web 2.0 as part hype, part marketing jargon, and part reality, not unlike latenight wrestling." writes Arma Partners in a research paper it published on the latest crop of online ventures.
It is an intriguing analogy. If Web 2.0 is like latenight wrestling, then it is totally bogus because as far as we know those wrestling “matches” are pure fiction. Ok, the firm didn't say "exactly like", it said "not unlike" but let's try out the analogy.
There are basically three types of participant in the pro-wrestling game: the organizers (such as WWE World Wrestling Entertainment Inc), the flamboyant stars or wrestlers (The Rock, Hollywood Hulk Hogan, Candice), and the fans.
The only thing real about pro-wrestling is the money that the organizers make. Just check out WWE in the Hoovers company database. So are the investment banks like the WWE in this scenario? They can make real money in fees by brokering the M&A of Web 2.0 companies, taking a small slice of the $5B spent last year alone on acquisitions by Google, Yahoo, News Corp and the like.
The “pro wrestlers”, the outspoken stars of the events, would be the entrepreneurs, we guess. The venture capitalists backing them are like the wrestlers’ promoters. This group also make some money based on their entertainment value and their ability to create a strong community of fans.
But which group is the analog to the wrestling fan? We take it that role is the one that is left for the Internet giants and the wannabe Internet giants, such as traditional media companies and telcos, the ones touting the triple and quadruple-play service strategy.
Are the acquirers like a wrestling fan, not one that merely buys a ticket, but one that actually makes a bet on the outcome of a RoyalRumble or a Smackdown tournament?
Not likely. We stretched the analogy too far. Besides investment banks surely do not see strategic buyers as foolish gamblers. But it was an interesting little exercise.
And it has given the alarm:clock a new idea. We are now looking into how we can reprogram our Movable Type templates in order to bring you pay-per-view RoyalRumble-like title matches. Anyone up for a smackdown battle between Google Video and YouTube or Yakalike versus Peekko?
Stay tuned.
Read - “Web 2.0 – Hype or Reality?” (Arma Partners)
Read - Company profile of World Wrestling Entertainment, Inc (Hoovers)
Posted at 06:20 AM | Posted to Venture Capital | TrackBack | Permalink
Everyone wants a piece of Skype's cachet
Technology startups don't need to be based in America to be successful - the UK is in fact better, according to a keynote speaker at recent confab in London who was quoted in an article published in The Register today. The proof that hyper-success can be achieved in the UK is Skype, which the panelist said was based in London.
Everyone wants a piece of Skype's billion dollar cachet it seems. But was Skype British? Sure some of the execs work in London. But the Swedes are laying claim to Skype because of the nationality of one of the founders. Luxembourg claims it because Skype's holding company was based there. And the Estonians can claim a piece of Skype too because a lot of the software developers and support staff work there.
We are all up for more tech investment on this side of the Atlantic, but we think that rather than proving that the UK is the best place to found tech companies, the Skype story shows that for online service companies that deal directly with consumers, location is not that relevant for quick growth. It is not necessarily true for the rest of the tech sector.
Posted at 05:44 AM | Posted to Venture Capital | TrackBack | Permalink
February 20, 2006
An uncertain future for pure-play blogging startups
Some news out of Switzerland has the a:c euro wondering about the future of pure-play blog startups.
Today we heard from Stephane Pictet, co-founder and CEO of Virtual Network in Nyon, that his small team of developers put together in three months a new blogging platform for his firm’s popular web sites, Romandie.com, musique.com and jeu.com. These are highly-trafficked, French language web-sites, whose users are potential casual bloggers, basically newcomers to online publishing in the blog format.
Virtual Network could have undertaken a partnership with one of the established players active in the Swiss and French market, but Pictet told us that it was “five times” cheaper to build rather then buy space on an existing platform. (He declined to provide names of blog software vendors with the pricey offers.)
This is not very good news for pure-play blog publishing startups. If it is this easy for a web savvy startup to roll its own “ergonomic” and user friendly blog platform (based on open the pblogs open source software distribution), the future for pure-play blog publishing platforms, such as Wordpress, Kaywa, Six Apart, Bloggers.it, Overblog, or any of the others that are active in the region, is going to be more limited, particularly among casual bloggers, than the hype suggests.
There is nothing stopping an OpenBC or a Stardoll, sites that have hundreds of thousands of regular users and subscribers, to decide to develop their own publishing platform for user-generated content. We think that a casual blogger is more likley to use the publishing software on offer from their community of interest than look further afield.
Clearly, there are some publishers and content developers that will need a professional platform, such as those on offer from Wordpress or Six Apart, but how big is that market niche?
Posted at 11:17 AM | Posted to Web 2.0 | TrackBack | Permalink
Social networking startup buys Swiss firm to add live events
Updated entry: Social networking site, OpenBC, based in Munich, has acquired Zurich-based event organizer First Tuesday Zurich (FTZ) to add live global events to its online activities, the alarm:clock euro has confirmed with OpenBC today.
According to OpenBC's spokeswoman (who responded to our email request for a confirmation about the deal after we noted that Bruno Giussani had posted in his Lunch-over-IP blog that the deal was closed last week and the announcement was pending) OpenBC has acquired 100 percent of FTZ. The terms and conditions of the deal are not being disclosed by either firm.
Kish founded the Zurich version of First Tuesday, one of many that popped up all over Europe during the bubble, following the London-based original.
When the bubble burst, Kish revamped the business model to offer events in the Zurich area and conference publications (think-tank papers) for customers such as alternative asset managers (the European Energy Venture Fair), software and tech companies (IBM, Cisco, etc.), and consulting companies (PriceWaterhouseCoopers).
Now Kish will be charged with building up and running openBC's "live events" global unit from her base in Zurich.
OpenBC claims more than one million members today, mainly technology company management types in Europe and Asia. Its traffic suggests its members use it on a fairly regular basis, and in fact are increasing the frequency of their visits. Your alarm:clock euro reporter is a paid up member of OpenBC.
Read -Zurich rumors (lunch over ip)
Read - OpenBC's Window Into Entrepreneurial Zeitgeist (the a:c euro)
Posted at 10:25 AM | Posted to Web 2.0 | TrackBack | Permalink
February 17, 2006
Online Paperdolls Capture Index Ventures' Fancy
Index Ventures has a knack for finding out what's popular on the Internet and then backing these otherwise low profile ventures. Its latest investment, a €4M injection into Stardoll.com, an online celebrity and doll dressup site, is an example of that.
The a:c euro is aware of the popularity of playing with paperdolls online due to market intelligence gathered from our ten-year old female in-house expert. The activity rivals time spent on sites like Neopets and Barbie.com.
It is apparently a "sticky" type of web site, one that users go back to frequenty. "Stardoll.com is a web phenomenon," said Danny Rimer, general partner, Index Ventures, in a statement, citing stats from TNS Metrix data that show more than one million unique visitors each week. The firm generates sales with online ads as well as selling a premium membership that turns off the ads and gives access to so-called VIP dolls.
Dressing up Beyonce and 50Cent is popular with Stardoll's registered members
Stardoll's creator is a fifty-something Scandinavian woman who relied solely on word of mouth for marketing. Her son did a lot of the early programming for the site. Index brought in Mattias Miksche as CEO along with the money. Miksche founded E-trade in Germany and Scandinavia and the once high-flying Boxman, which was recently sold to UK-based Lovefilm, according to Index Ventures.
Read Index Ventures Invests US$4 Million in Stardoll.com
Posted at 06:31 AM | Posted to Games (PC and other) | Venture Capital | TrackBack | Permalink
French Web Shopping Incentive Firm Taps Investors
France's Journal du Net criticizes AXA Private Equity's latest investment in Ebuyclub, an online cashback and couponing business, for being behind the times now that we are in a Web 2.0 world. It is true the Ebuyclub is not a next generation web firm, but the investment is perfectly in line with the times or trend that sees European investors backing the expansion and growth of money-making online ventures.
And it is in line with AXA’s private equity mandate. It is not supposed to be doing early stage deals.
EBuyclub is owned Plebicom SA and was incubated by a Plebicom subsidiary known as Teamlog. It operates in France and the UK. The €2M it announced raising from AXA this week is for a marketing push. The company is cash-flow positive on annual sales of about €1.2M. The cash injection was the startup's first round of financing.
Read Le cashback de eBuyClub séduit Axa Private Equity
Posted at 05:56 AM | Posted to Venture Capital | eCommerce | TrackBack | Permalink
February 16, 2006
Turin Plays Host To Spyware Controversy
Freestyle skier Dale Begg-Smith won the men's freestyle skiing moguls to give Australia their third ever Winter Olympics gold medal.
We learned during the telecast that Begg-Smith and his brother were so passionate about skiing that they started an Internet advertising business - when Dale was just 13 - to finance their expensive ski lifestyle. They moved from Canada to Australia when given an ultimatum by the Canadian ski team to give up the business or leave the team.
Today, Begg-Smith's Internet business interests are reportedly worth $40M and Begg-Smith shows off the fruits of his labor tooling a Lamborghini around Italy. Commentators note that he never stops working - he's either skiing or running his business.
Begg-Smith Pops-Up From the Jump
Alas, Begg-Smith's business pertains to mal-ware. The two main companies, AdsCPM Network and CPM Media, manage and track the success of ads placed on the Internet through pop-ups, spam, spyware and adware technology. So while they may not be running spyware, they are enabling spyware.
While Begg-Smith was still basking in the glory of his medal win yesterday, he was questioned by US journalists whether he had made his money from annoying "spam advertising". To which Begg-Smith responded - "I make technology for companies to monitor their online ads. I don't do ad-pops. I make software so companies can do whatever they want. But I don't know what we are doing talking about my business when I've just won Olympic gold."
The Ausi media was peeved at the American press for mixing spyware with Olympic gold.
Read - Begg-Smith delivers gold for Australia (AFP)
Posted at 09:41 PM | Posted to Advertising | TrackBack | Permalink
MySQL finds Oracle resistible
Over at sister site, the alarm:clock, a post reports MySQL, a vendor of database software, rejected an offer from its much larger rival, Oracle.
There's a good quote from Marten Mickos, CEO of MySQL that reveals his conviction or bravado, depending on your opinion of his open source hybrid operation: "We will be part of a larger company, but it will be called MySQL."
The firm is already pretty big, with more than 200 employees and it is growing. MySQL does not disclose sales but industry insiders say it that generated about $40M in sales last year targeting the enterpise market. The same sources say its sales growth is at a double-digit rate.
For a European software company, it has raised a signficant amount of capital, some $39M including its latest injection announced this week. And it just might be its last if the press release is anything to go by.
In the past, the quotable Mickos has told reporters that he is as "greedy as anyone else" when it comes to making money with software developed and distributed on an open source model (MySQL actually has a dual license model). And he makes no secret that the way he wants to satisfy that greed via the promotion of an open-source "stack" of innovative and competing software applications that will rival "closed" web and enterprise software, the kind that tends to lock in buyers. (The stack he refers to is the LAMPS stack which includes Linux, Apache, MySQL, PHP / Perl / Python.)
It sounds like Mickos is aiming to remain independent. The firm could go public, that is if the NASDAQ ever recovers a healthy appetite for growth stocks.
Read MySQL slaps Oracle's buyout offer
Read Oracle tried to buy MySQL (CNET News)
Read MySQL secures VC (Newsforge)
Posted at 03:58 PM | Posted to Business software | TrackBack | Permalink
February 15, 2006
Munich Mobile Agency 12snap Bought by NeoMedia for $22M
NeoMedia Technologies (OTC BB: NEOM) has paid $22M for 12snap, a Munich-based mobile phone marketing agency. The deal sounds good at first blush, however, 12snap had raised over $39M since 1999 from firms Apax Partners, Argo Global Capital, Cdb Web Tech and BlueRun Ventures.
12Snap Created An Mobile App To Promote the Movie Madagascar
Posted at 09:50 PM | Posted to Wireless | TrackBack | Permalink
VC Euros flowing to RFID startups
We’ve posted about the growing amount of venture money flowing to proven online ventures, now it is time to look at another segment, Radio Frequency Identification (RFID).
We tracked eight investments in the past few months. By our definition, that's a trend.
The eight deals do not include investments in startups that are developing RFID chips made using polymers or semi-conducting plastics such as Printed Systems GmbH, recently funded by Degussa, or PolyIC (its RFID chip is shown here), funded by Siemens and Leonhard Kurz GmbH&Co. KG
The size of the deals tend to be smaller than the online and semiconductor VC investments, but the number of transactions is on the upswing. The finalizing of industry standards and the radical drop in RFID chip price (from $4 to less than 20 cents) has a lot to do with confidence in the sector, say industry insiders.
Tracking uniforms with chips (Image: Tagsys)
Used until very recently RFID tags were mainly used to keep track of dirty laundry, library books, cows, and gas canisters. It is now becoming more sophisticated.
Applications are emerging as public and private organizations see RFID systems as a way to squeeze more costs out of the supply chain, as a better way of toting personal identification around, and as a storage place for e-tickets.
For example, French startup Tagsys says Pfizer is using its RFID technology to battle counterfeiters of its popular Viagra drug
(Does anyone really believe that those spam ads for “discounted” versions of the little blue pill are delivering the real thing?).
Balance Bourbeau, a Canadian vendor truck scales systems used Identec's long range RFID technology to manage timber assets and comply with government reporting requirements.
An editor we once worked for used to say: one’s an event, two’s wait and see, and three’s a trend, so eight deals for Radio Frequency Identification (RFID) startups in eight months is a trend.The following is a quick list of recent transactions
Stockway (FI) – RFID software for developers-enables tracking via Internet – €3M (estimated)
Inside Contactless (FR)– short range RFID chips - €10.9 mln
Identec (AT) - long range RFID hardware for item and asset tracking - €3.4M
Idencom (CH)– RFID component for biometric passports - Swiss business angels- €1M
Safe-ID Solutions (DE) – an RFID systems for biometric passports (Infineon spinoff) -€7M
Tagsys (FR) – short range RFID labels and readers for item tracking -$12.2M.
Datamars (CH) – short range item and livestock tracking - undisclosed amount
RFiT (AT) – RFID software and gear for integrators (Infineon spinoff)– €4M
It looks like investors here think the time is right to fund the suppliers of chips, readers, and software. Notable is the interest in the data management software required to run an RFID application, which says that more of the technology pieces required to implement a real life system are being funded.
Whether or not any of these startups will emerge as a major player depends on the staying power of the VCs and the ambition of the founders. If the recent past is anything to go by, many will end up being tasty tidbits for deep-pocketed trade buyers.
Posted at 07:06 AM | Posted to Plastic electronics | Venture Capital | Wireless | TrackBack | Permalink
February 14, 2006
Sweden's Enterprise SIP Co. Hotsip Bought By Oracle
Is Oracle sending a message to rival SAP that Europe is its territory as well? Oracle has been making a growing number of small but sweet M&A deals in Europe over the past few months. Hotsip is highly regarded in its field. Now will see if these nice guys from Sweden get along with the thugs from Redwood shores.
Terms are not disclosed. Hotsip had raised around $18M in VC funding since its 1999 inception, from firms like 3i, Arganor Wireless Ventures, GO Capital and Ledstiernan AB.
If you are not familiar with it, Hotsip sells SIP application servers for large scale, carrier grade SIP enabled broadband and 3G/IMS networks.
View - Hotsip Has been acquired by Oracle (Company Site)
Posted at 10:33 PM | Posted to VoIP | TrackBack | Permalink
$6M For France's EVE
French emulation startup EVE has closing a $6M C round of funding from existing investors Auriga Partners, 3i, CAPE , Siparex Ventures and Edmond de Rothschild Venture Capital.
The company has received $16.4M in three rounds of venture funding. EVE lays claim to have more than 35 customers — including 8 of the 10 largest semiconductor companies.
Read - Emulation startup gets $6 million in funding (EE Times)
Posted at 10:18 PM | Posted to Semiconductors | TrackBack | Permalink
Index Ventures EIR starts up Wikio
Pierre Chappaz, Index Ventures entrepreneur-in-residence, is giving interviews in the French trade press and blogging at Kelblog (his personal blog) about Wikio, his latest venture. Chappaz is best known for founding Kelkoo, a Pan European online shopping guide, and selling it to Yahoo for a bundle, making him and his investors a tidy profit.
Chappaz - Up Close
Wikio has not launched yet but according to an interview with Journal du Net, Chappaz is creating an RSS-based portal that sorts RSS content based on tags and plain text search. It is not a Wiki type application, although its name is similar.
The site sounds to be a cross between Technorati, Digg, and Google News. Chappaz says he has linked in some 10,000 news and source sites in the French speaking part of Europe. Google News (French) version has only 500, according to Chappaz. Some 1000 people have already signed up for the beta launch expected in four to six weeks.(This is the kind of pull that only a multi-millionaire entrepreneur has. We saw the same phenomenon with Martin Varsavsky of FON fame.)
The team is already thinking ahead. This time Chappaz based his company, in Luxembourg. So was Skype based there. The capital gains taxes in Luxembourg are favorable to entrepreneurs should they decide to sell the business.
Read Le Net Interview (Journal du Net)
Posted at 03:52 PM | Posted to Web 2.0 | TrackBack | Permalink
MSFT Buys Siemens-Founded, Paris-based Mobile Search Co. MotionBridge
This deal was done some weeks back, but Microsoft held on to it to spring at a telecom event this week in Barcelona. Of particular interest to Microsoft, we suspect, is that MotionBridge has recently launches a sponsored links ad service into its mobile search platform. MotionBridge seems like a very good buy for Microsoft as it has good ties with European wireless carriers including Orange and TMobile.
MotionBridge was one of the early stage startups funded by Siemens former mobile corporate venture capital team, known as SMAC. Siemens discontinued the investement activity several months ago and has been divesting itself of the portfolio. Microsoft probably was offered a good deal. The Redmond based giant has been making opportune acquisitions in the region. Late last year it acquired a VOIP software company in Switzerland, Media-streams, in a deal that did not make the founders massive fortunes, we hear.
Posted at 01:53 AM | Posted to Wireless | TrackBack | Permalink
Vienna's 3United Bought By VeriSign For $65.5M
VeriSign's M&A team must be getting tired. They have been jetting in between Silicon Valley and Vienna, Austria to close a deal to bring 3United into the VeriSign fold. 3United is one of the European market leaders in premium SMS services, m-commerce solutions, and mobile content.
3United's Founders - Working in the Shadows of Vienna's Beautifiul Palace of Schoenbrunn
Posted at 12:16 AM | Posted to Wireless | TrackBack | Permalink
February 13, 2006
MySQL Gets $18.5M From SAP, Intel And Other Fresh Deals
Investments
SWEDEN MySQL Has Raised $18.5M in Series C Led By Institutional Venture Partners With Intel Capital, SAP Ventures and Presidio STX, Index and Benchmark (Open-source Database)
GLASGOW, SCOTLAND, Nallatech Has Raised $5M From ETV Capitaland Bridge Bank (FPGA - Military - Computing)
LONDON, UK Kodime Has Raised An Undisclosed Amount of Venture Funding From
The Capital Fund (Mobile Media Software For Realtors)
M&A
REDMOND, WA & PARIS, FRANCE Microsoft Buys MotionBridge For An Undisclosed Amount (Mobile Search)
VIENNA, AUSTRIA VeriSign to Acquire 3united Mobile Solutions For An Undisclosed Amount (Intelligent Infrastructure For the Internet)
LUXEMBOURG & AALBORG, DENMARK MACH Has Acquired End2End For An Undisclosed Amount. Mach was Bought by Warburg Pincus, and End2End Has Raised $170M In VC (Outsourced Mobile Data)
Posted at 05:33 PM | Posted to News And Updates | TrackBack | Permalink
Bummer - European VC Deals Fall 16% in 2005
Venture capital investment in Europe slowed from 2004 to 2005 with 16% fewer deals, although they invested just 5% less cash.
European venture capitalists did 16%fewer deals in 2005 than in the previous year as they shifted their focus to later-stage investments.
VCs in invested €3.6B ($4.29B) into 1,020 European startups during 2005, according to the study by Ernst & Young and VentureOne.
Posted at 05:27 AM | Posted to Venture Capital | TrackBack | Permalink
February 12, 2006
Finnish interactive TV to grow with 3i investment
3i Group acquired a 12.5 percent stake in RedLynx, a content developer targeting television, PC, and mobilephone markets. After looking at its web-site we now know the company behind one of the weirdest things on TV we've ever seen.
During off-peak times a private television stations broadcast a show where a bunny reads aloud messages sent in by viewers. It works like this, the viewer sends an SMS (text message via mobilephone) that says something like, “I love FC Basel”.
Then you hear a beep on the TV, the sound of a letter arriving in bunny's basket. He picks it up and reads the text, which is also displayed on the screen. The voice is computer generated and does not do well when it has to read messages that come in German, French, and English. The messages cost about $2.50 each to send.
RedLynx' cupid reads your love notes on TV
.
It also created the Rick and Monica talk show where viewers put the words in their mouths.
RedLynx shares revenues with the TV broadcaster. Founded in 2000, Redlynx employs 40, mainly in Helsinki. It's sales in 2005 were close to €3M. The investment is meant to fund the international sales
VCs in Europe have been making a few tentative investments in the interactive TV market. Munich’s Baytech Ventures has invested in Betty TV AG, which relies on modified remote control to interact with Swiss and German television and broadband TV programs, and BV Capital has invested in moreTV Broadcasting GmbH, Hamburg, which is targeting satellite TV broadcasters.
This is one of those markets that in the past got a lot of hype. So far, it has brought us bunnies reading text messages on TV and voting by phone on who should win the Eurovision song contest. We can only conclude that the killer applications are yet to come.
Posted at 10:09 AM | Posted to Wireless | TrackBack | Permalink