alarm:clock euro: March 2006 Archives

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March 31, 2006

Netz 2.0 aka Germany’s Web 2.0 Contenders

Several readers have written to ask about Web 2.0 in Europe, so the alarm:clock euro turned to Cologne-based Klaas Bollhoefer for his list of Web 2.0 services in Germany.

The Internet and mobile services consultant, who maintains the web.xpunktnull.de blog, complied and notes that the list is constantly being updated. For other regions in Europe, TechCrunch has a French version (link below) and we are on the lookout for lists in Benelux and the Nordics.

List of Web 2.0 services in Germany
Audioclipping Search AV
Bagook News Aggregator
DerWunsch Share a wish.
Dopcast Podcast portal
Ehrensenf The German Rocketboom.
Eventicus Create & share events.
Icio Social bookmarking.
Kulando Blog service.
Largest Online Stadium Place your fan.
Laufrausch Share walks/runs
Leze Online Bookmarking.
Loudblog Manage & create your podcasts in a cms
Lycos IQ Expert Search.
MabberUnified IM solution, web based.
Miaplaza Community building platform.
Mister Wong Online bookmarking.
Musiclens Music recommendation.
Openbc Business network.
Paguna Hotel reservation on one ajax page.
Photocase Manage & share photos.
Plazes Claim and share your locations.
Qype Find & recommend addresses and services. (alpha)
Read.io Podcast your blog.
Reliwa Manage & share your books.
Romso News search.
Sofortpreis Mobile shopping assistant
Sozeug Buy & sell handmade stuff
Supreme Auction A German Ebay service.
Swabba Online exchange
Taggle Online bookmarking
TVfeed Get TV as RSS.
Typolis Blog platform
Webmontag Web 2.0 meetings using a wiki
Wikimatrix Wiki comparison.
Yigg The German digg.com

Read - TechCrunch France
Read - Besser als wir dachten (Klaas' blog)

Posted at 04:49 AM | Posted to Web 2.0 | TrackBack | Permalink

March 30, 2006

Scatterweb Founders Get Financed

Startups in the wireless sensor network (WSN) market in Europe are attracting early stage funding. The latest is Berlin-based Scatterweb which has raised an undisclosed amount from High Tech Grunderfond, a German state-backed investment vehicle. An early investor in the one year old company is eVentureCat GmbH.
The deal follows Particle Computer and Ubisense, two other WSN ventures, to raise capital in recent months.

The ScatterNode is about the same size of a book of matches.
The university spinoff has a range of wireless sensor networking products, including stand-alone nodes that can be equipped with displays or cameras, a USB stick node, and a gateway product.

Read - ScatterWeb bekommt Risikokapital für weiteren Unternehmensaufbau (scatterweb)
Read - Ubisense (a:c euro)
Read - Particle Comptuer (a:c)

Posted at 12:40 PM | Posted to Venture Capital | Wireless | TrackBack | Permalink

Startup addresses vagaries of publishing docs on mobiles

We heard about a Finnish startup, Max Rumpus, this week from its Swiss seed round backer. It is the company behind Maxdox a software application used to publish documents on mobilephones. It looks like a product for an unmet need in the wireless market.

HP uses MaxDox to produce pint-sized documents for the mobilephone platform.

MaxDox screenshot with its functionality featured (Click image to enlarge)

It's offering a consumer and a business version of the application. The consumer, or personal version, is free to download.

Max Rumpus was founded in 2001, by Stephen Lee, who now heads up marketing, and Mika Huhtamäki, currently the firm's CTO, both of whom previously had gigs at Wapit! The firm's CEO, Tero Kalsta, worked for Jippii, a mobile content developer, whose European business was acquired by the UK's iTouch in 2004 for up to €30M.

The Leningrad Cowboys' hairdos are as pointy as their shoes

Wapit! you may recall was one of the stars of the hype that surrounded the launch of the Wireless Application Protocol (aka WAP). It was VC-backed and got a lot of press attention -- mainly because its flamboyant PR exec, Mato Valtonen, was a member of the gimmicky Leningrad Cowboys -- but because WAP was crap (for mobile Internet access), its business ultimately flopped.

Max Rumpus has financed software development, its first product was a mobile messaging alert program, targeted at businesses, by providing consulting services. It then launched in 2003 the first version of Maxdox, and brought in seed investors.

In January it raised an undisclosed amount in a first round of venture capital, led by Innofinance, a Finnish VC, after being backed by seed investors prior to that. Today it is focused purely on developing the Maxdox Mobile Publisher software business.

If things go right for this startup, it could do for the mobilephone what Adobe and its free readers do for PDF documents on the desktop. If that doesn't happen then it has a chance to develop a smaller sized business making its software availalbe to brand marketing agencies as part of a set of tools that would enable publishing to the mobilephone platform.

Read - Innofinance assists Max Rumpus to strengthen its sales

March 29, 2006

Flytxt Raises $2M To Focus On Mobile Ads

Yesterday we wrote about TXT4's financing round, and today we have one of its competitor's Flytxt, also hailing from the UK, announcing that it will focus its business on mobilephone marketing tools. In the same statement, it said existing investors IVC, Herald Ventures, and Gordian Investments have put in $2M to fund the effort.

Flytxt developed the mobilephone marketing campaign for Unilever's Pot Noodle food product.
Flytxt has been in business since 2000. Looking at its press releases over the years, it originally planned to deliver mobile advertising tech, but when the bubble burst it revamped and went to delivering multimedia and texting messages. Other mobile advertising startups went out of business during that time or got acquired for a low valuation.

It seems that the firm, and its rivals, feel that now is the right time to focus on enabling ads targeting mobile phone users. A typical ad campaign from Flytxt involves consumers sending a text message in response to ad or a pitch on the package of a food or drink item. Its software enables the brand owner to measure and plot the response to its campaign.

Read -Flytxt Strengthens Senior Management Team (press release)

Startups Sink Fangs Into Cellco Margins On Voice and Data

While US VCs are backing long distance voice startups, such as JaJah, a host of startups in Europe are aiming for the mobile network operators' cash cows, their mobile voice and data services.

You could almost feel sorry for Europe’s telcos and cellcos, almost. What with Skype and dozens of others offering VOIP services that attack long distance revenues, and groups like FON rushing their hotspot and broadband mobile services. But the incumbents’ high rates for mobile voice and data services, just make them such easy targets.

Here is a quick list of some of the recently launched, or about to be launched, services that the alarm:clock euro has come across this week.

Hotxt (UK) - flat-fee text messaging service for UK market. Works with Java phones and requires a user to install client on handset. Hotxt is backed by Cambridge Angels and Bridges Community Ventures.

Atelplus (Germany) – Cheaper wireless voice calls with a patented least cost routing system. It is not yet launched but we’ve talked to the founder. The user will have to install a client on the phone. Only works on high end smartphones, although founder says he plans to roll it for lower cost Java phones. Bootstrapped.

Vipera (Switzerland) – Develops software that enables its customers (and the firm itself) to become a virtual mobile messaging network operator, undercutting cellcos text messaging service and photo messaging. Vipera has already launched ShootNSend to take photos on the fly and transmit them via mobile Internet service (GPRS), bypassing the pricey picture messaging service (MMS) from cellcos. It also hosts and enables an Italian mobile blogging platform, and sells its messaging technology platform. Bootstrapped.

Sofanet (Germany) – Wifi networks to share broadband connection between neighbors. Bootstrapped.

Posted at 12:49 PM | Posted to Wireless | TrackBack | Permalink

Stingray spins out Qinetiq with VC investment

Stingray Geophysical, which makes fibre optic seismic monitoring gear used in oil and gas exploration, raised £6.6 million in VC funding from Energy Ventures, Hydro Technology Ventures, and Chevron Technology Ventures. QinetiQ, the British defense technology firm from which it spun out, retains a 19.9% share in Stingray Geophysical.

Permanently deployed on the sea-bed Stingray's waterproof system provides more info to oil companies about hidden or unexploited reserves that existing gear.

Posted at 12:13 PM | Posted to Venture Capital | TrackBack | Permalink

Japan's Index Corp Buys Wonderphone

Japan's Index Corp, a media and telecoms company, is to buy mobile TV and games distribuor, Wonderphone in France through its French subsidiary Index Multimedia. Index has made several acquisitions in the mobile content sector such as Mobliss (US) in 2004, Skyinfo (China), Yarosa (NL), and 123Mutlimedia (France) in 2005.

We just posted on Wonderphone's progress last week, noting the firm's ability to generate sales in the mobile TV market segment. So why sell? Market research firm, Ovum, believes it had to do with thin margins and a need to pull in a strategic investor with an international footprint.

... despite its success story, WonderPhone had two main problems. Firstly, its size was rather limited (70 employees) for addressing worldwide distribution and getting involved in various activities (platform management, production, post-production). The Index acquisition should remove this issue. The second issue is the question of the level of the profits available for a middleman specialising in mobile video, sandwiched in between rights owners and mobile operators. Small margins could be the reason why Plaisance decided to exit the market so fast. . (Ovum)
Read - Index Multimedia Announcement (ITNewswire)
Read - Vincent Poulbere: Index acquires WonderPhone to strengthen mobile video offering (Ovum)
Read - Wonderphone In The Money (alarm:clock euro)

Posted at 11:41 AM | Posted to Wireless | TrackBack | Permalink

Cambridge's Ubisense Raises Funds for Location Tagging

ubisense logo.png

Ubisense has raised $3M from Cambridge Angels and Cambridge Capital Group. Ubisense was founded in 2002 by four location technology experts from the Laboratory for Communication Engineering at the University of Cambridge.

Its sensor product uses ultra-wideband (UWB) technology to locate people and objects in real-time to an accuracy of 12 inches (30cm) in 3D.The company targets military and healthcare fields but has nifty ideas such as sensors to aid in personal shopping:

"A shopper is passing the tinned vegetable section the digital assistant can pull up a special offer with recipe ideas from specific manufacturers. The shopper could then add the item to the cart and purchase with an ecoupon rather than worrying about paper coupons."

Or in entertainment:
"By placing Ubitags on actors or objects on film sets or stages Ubisense can help lighting and special effects engineers get an accurate location of actors at any time."

ubisoft sensor.png
Ubisoft's Sensor

Posted at 06:46 AM | Posted to Wireless | TrackBack | Permalink

London's Empower Interactive Gets Big $18M Round

empower interactive.png

Empower has raised a US$18M round of funding that was led by Scottish Equity Partners and supported by existing investors Argo Global Capital, Cazenove Private Equity, DN Capital and IDG Ventures Europe. The news follows from an 80% increase in revenues for 2005.

Empower designs messaging and multi-media systems for mobile operators that provide for billing and managing of high volume SMS and MMS applications.

The company was founded in 2000 and has mostly European customers including Orange, WIND, Smart, Starhub, Telkomsel and Etisalat.

Posted at 06:22 AM | Posted to Wireless | TrackBack | Permalink

Another Big Wagering IPO

The London Stock Exchange’s market AIM saw one of its largest IPOs as Playtech went public valuing the online gambling software maker at nearly $1 billion.

Seven year-old Playtech began trading at $4.50 per share, raising $55.6M. Playtech has 39 licensees for 94 online casinos, 15 online poker sites, and 15 online bingo sites and its profits have grown to $35.6M in 2005 from $8.3M in 2003.

Playtech was founded in Estonia where most of its programing still takes place, but its HQ is in the British Virgin Islands, where we understand taxes are not a problem .

The company's 32-year old CEO is Avigur Zmora. He was CFO of New Age Ventures, a Tel Aviv listed company that served as an incubator to tech startups, including Playtech.

Playtech table.png
Playtech's Software

Posted at 05:50 AM | Posted to Games (PC and other) | TrackBack | Permalink

March 28, 2006

Advertisers get texting channel

Ads and billboards often have telephone numbers or URLs so that consumers wanting more information can follow up. Now TXT4, a London-based startup, makes it possible to add a text message address to the mix.

TXT4's tech in action on this Sony Ericsson ad, which tells consumers to write a text message containing the word SHOT and send it to this address:84118

It is not the first startup to offer this kind of service in Europe, but it's the first to focus on it as an advertising product and make the service its main revenue generator. Two VCs have stepped up to back its expansion beyond the UK, Oxford Capital Partners and Noble Fund Managers

The company’s aims to go global with its "automated response management software" and it will target large brand name firm. It estimates the addressable market is worth about £750M.

Read - Oxford Capital Partners and Nobel Fund Managers invest £1.25m in TXT4 (Tornado Insider)

MP3 Inventors Look To Fund Cinema Sound Startup

Karlheinz Brandenburg, who holds the main patents for the MP3 format popularized by Apple's iPod, is leading a startup called Iosono, which sells audio processing, mixing software, and speaker systems that afford cinema-goers (for example) a more realistic sound experiences.

Brandenburg is looking to raise €10M this year to fund the business, according to an article in the FT today.

Speaker arrays from Iosono are targeted at cinemas, concert halls, and theatres.

This is how the firm describes its product:

Speaker arrays ring the listening space and operate in a coordinated, phased fashion to re-create each individual sound wave. For example, a helicopter can slowly approach the audience, fly through the middle of the theatre, and disappear off into the distance. The audience hears the sound waves the helicopter would generate if it were actually flying this path.

Read - Germany's innovative streak

Posted at 12:02 PM | Posted to Early stage | TrackBack | Permalink

Zanox Up For Sale?

We've been hearing that something is afoot at affiliate marketing technology firm, Zanox, and it looks like Dow Jones reporters have picked up on it with a story that says an IPO or a trade sale is in the works.

Things are looking up for Berlin-based Zanox
The newswire cites un-named sources in the article, which estimates that Zanox is worth between €250M to €350M, based on Zanox's EBITDA numbers (which are not publicly available) and a mutliple of 20X net profit (based on the multiples apparently enjoyed by its peers, such as recently floated TradeDoubler in Sweden and CommissionJunction in the US.)

Zanox management has told the a:c euro in the past that acquisitions are in its sights. It already completed one in France recently, so an IPO, or a sizable investment by a private equity firm, would fit with that plan, but a trade sale less so.

Read - Zanox plant IPO oder Verkauf bis Ende des Jahres - Kreise (Dow Jones on Finanztreff.de)

Posted at 09:15 AM | Posted to Advertising | Online services | TrackBack | Permalink

London's Zopa Takes $15M To Move Into the US

London-based Zopa has raised $15M in Series B funding from Bessemer Venture Partners as well as existing investors Benchmark Capital and Wellington Partners. Zopa plans to open its California office this year. The company is just one year old but has a head of steam, claiming 55K members. Zopa pioneered person-to-person lending, which seeks to lower borrows rates and give personal lenders a higher investment rate than savings accounts.

Zopa's chief rival is Prosper.com - which we assumed borrowed Zopa's business model. Zopa is led by executives who previously launched Egg PLC. Bessemer Venture's Rob Stavis, who led the financing of Skype, will join the Zopa board of directors, so of course Zopa is comparing itself to Skype.

Read - Zopa Raises $15 Million in Funding to Launch in California (Press Release)

Posted at 01:47 AM | Posted to eCommerce | TrackBack | Permalink

March 27, 2006

BMC Buys Venture-backed Identify for $150M

BMC Software Inc has agreed to buy Israel's Identify Software Ltd., for about $150 million, reported Reuters today, explaining that the acquisition of Tel Aviv-based Identify, which has about 500 customers, would further extend BMC's presence in transaction management.

Some details on Identify and its backers were provided by Ynet News.

Identify, which develops systems for monitoring and resolving problems in software applications, raised about USD 63 million during its 10 years of existence. The major stock owners of the firm are venture capital funds Star and Evergreen.

Other investors according to the firms website include UBS, Intel Capital, Earlybird Ventures, and other local funds.

Read Software giant BMC buys Israeli start-up (Ynetnews)
Read - BMC acquisition (Reuters)

Posted at 04:31 PM | Posted to Business software | Venture Capital | TrackBack | Permalink

French mobilephone and gear etailer raises first round

Expansys might have some new competition in France as MeilleurMobile.com has just raised €1M from Paris-based Galileo Partners. (Update: Or maybe not if Alexa traffic ranking is indicative. See below.)

MeilleurMobile sells cellphones, accessories, and provides price comparison information on operator subscriptions and packages.

According to a recent article in 01Net, all the founders are under 24 years of age. They founded the firm in 2004 and generated sales of almost half a million euros in their first nine months in business. These types of sites seem to do well and this one has smartly covered the mobile network operator pricing schemes, which are becoming increasingly difficult for consumers and businesses to navigate, with a comparison engine.

Read - MeilleurMobile.com lève 1 million d'euros auprès de Galileo (Neteco)
Read - Meilleurmobile.com, un comparateur de prix pas comme les autres (01net)

Skyrock and Skyblog Acquired by Private Equity Investors

Axa Private Equity has acquired an 80% stake in Orbus, the company behind French radio station Skyrock and Skyblog, a popular blogging platform, according to news coming out of France today.

Le Figaro first reported news of the transaction this morning. It said that founder Pierre Bellanger retains the other 20%. The amount was not disclosed but the French paper put a €100M valuation on the company. Orbus had sales of €31M last year and a proft of €7.5M, according to the French paper (not clear if that is EBITDA).

The reason Skyrock was on our radar is that it was one of the first media companies in Europe to offer a blog publishing platform to its audience of 12 to 24 year olds.

And while it is very common now that newspapers, TV and Radio stations in Europe offer blogs to their audience, when Skyrock started Skyblogs, it was not. Today it has over 4M blogs regsitered, according to the Skyblog front page. To put that in perspective, France has a population of 60M. As of posting this article, some 2800 blogs had been created today.

According to a one year old article in BusinessWeek, some 20 percent of the parent company's sales are generated via online ads and affiliate marketing schemes related to the popular blogging platform.

The deal was a secondary buyout with Axa acquiring the stakes held by Morgan Grenfell and Goldman Sachs.

The a:c euro expects updates to emerge from other sources, especially if this was a good exit for the earlier investors. So check back if this news of interest.

Read - Let them eat cake and blog about it (BusinessWeek)
Read - AXA Rachat Skyrock (Le Figaro)

Posted at 10:33 AM | Posted to Buyout | Web 2.0 | TrackBack | Permalink

Magix IPO takes shape

More details today from Dow Jones (German) on the upcoming IPO of Magix, a Berlin-based publisher of software to make and edit digital images, videos, and sound files. The scheduled date is April 6th. The alarm:clock euro notes that it is mainly the old shareholders that will benefit from the IPO.

Magix will be the first IPO of an independent software company on the German stock exchange since 2001.

Of the 5.28M shares on offer, only 1.35M reflect an increase in captial, the rest of the capital will go to shareholders, which include 3i. The capital increase proceeds will be used to build up the distribution network, some R&D, and a potential acquisition or two. Magix hopes to sell between €65M to €115 worth of shares.

The roadshow begins on March 27th. Dresdner Bank and Cazenove are the banks mandated to carry out the transaction.
Read - Berlin's Magix Prepares IPO (a:c euro archives)
Read - IPO/Bis zu 5,28 Mio Magix-Aktien kommen an den Markt (vwd)

Posted at 07:03 AM | Posted to IPO | Media | TrackBack | Permalink

Dampening visual noise - a business opportunity?

We've been posting about VC investment into billboard firms and TV ads insertion startups. To mix things up, we heard today about an artist who is gaining fame for erasing or removing text and logos from urban scenes.
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The artist is Hyungmin Moon, and the photos are part of his Unknown Cities series.

We learned of the Korean artist's "strangely peaceful" images in Google Blogoscoped (which like the alarm:clock, is a member of Federated Media Publishing network). We have to agree and in the meantime we found an online exhibition of the Korean artist's work.

It is like going back in time to the sixties, or to the eighties if you're from the former Eastern block countries, to a pre-logo and brand ad world.

And it is interesting to note that a) the reference to his work came from a blog about online search and advertising, and b) that according to the small bits of information we could find on Moon, he is a graphic artist whose visuals are also influential in the advertising and video games markets.

In other words, the no-logo-contrarian thinking appeals to those inside the industry.

Moon is tapping a desire for less visual noise in the urban environment.

We like disruptive ideas at the a:c euro. So instead of looking for ways of making logos and ads more intrusive, maybe there is a basis for a business in doing things differently?

It is just a thought on this sunny Monday morning from somewhere west of Zurich.
Read - alarm:clock euro: Computer-generated Ads Tech Firm Attracts Early Stage Cash Archives
Read - It's Giant Webpages in the Sky
Read - Unknown Cities

Posted at 04:48 AM | Posted to | TrackBack | Permalink

March 26, 2006

California VCs Eye Fuel-efficient German Auto Startup

Over at Silicon Beat, there is a report on Silicon Valley VC interest in alternative energy investment. The Economist also featured a profile of a billionaire VC who has turned to alternative energy because high tech doesn't do it for him anymore. We note the trend and also want to pick up on SB's coverage of a German startup, Loremo AG.

The company has built a super-efficient "Loremo LS" coupe that costs only 11,000 Euro and features a "mind-blowing" 157MPG mileage. It was shown in Geneva earlier this month.(Silicon Beat)

The German startup is aiming to bring two versions of its lightweight and aerodynamic auto to market, one that clocks its highest speed at160 Km/h, and one that tops out at 220 Km/h, which would be good for German autobahn driving where speed limits are not assigned. Both are slated for 2009 delivery.

Loremo's engineers appears to have adapted some efficiency-enabling design tricks used by mobilephone manufacturers.

The company is based in Munich and has been in the works since the early nineties. The founders, Uli Sommer, Stefan Ruetz and Gerhard Heilmaier, brought in some investors in 2005, according to the firm's website.

We think that Loremo is on the right track, but it should also develop a model that would offer an alternative to the gas-guzzling minivan favoured by parents that insist on driving their kids to school or the ones that get "volunteered" for the tri-weekly socceer run.

For inspiration, we say take a look at the Fiat Multipla (pictured above), which might be ugly, but it is the first four meter chassis vehicle that comfortably seats six. Its short length makes it easy to park in Europe's tight spaces and it has an optional natural gas powered engine. The Multipla is a highly under-rated vehicle. Italy's Fiat is unfortunately not as good at marketing as it is at innovation and design.

Read - >Face value | A healthier addiction (Economist.com)
Read - Billionaire green entrepreneurs; the sweet Loremo & SF's cleantech competition (Silicon Beat)

Posted at 07:44 AM | Posted to Alternative Energy | Venture Capital | TrackBack | Permalink

March 25, 2006

Computer-generated Ads Tech Firm Attracts Early Stage Cash

Virtual Advertising Systems VAS Ltd, whose technology can superimpose logos, ads, and product placements into a live TV broadcast, has attracted an undisclosed amount of cpaital from Conor Venture Partners and the Finnish Industry Investment fund.

The Finnish company's patented tech can change on the fly the sponsor's name on the hood of a racing car or the sails of yacht, if that is required.

It also has a product that can change the banner ads around a racing track or the banks of a ice hockey rink so that when a sportler skates or drives past the banner is modified. As a result, its target market is TV broadcasters of indoor and outdoor sporting events, so they can customize advertising according to the market for global disrtibution. So that country-appropriate ads will be seen by an American, an Asian, and a European viewer.

VAS particular edge is that it uses different machine vision and tracking techniques than its competitors, which makes it particular suited for the applications described above. This type of ads insertion technology has been in use for several years, mainly with static objects, such as a Coke machine in the background of a scene, or a box of branded cereal on ths shelf behind the star of a sitcom.

Some of the R&D for VAS was done with Finland's VTT, which is one of the top computing and electronics top research institutes in the Nordic region.

Read -
Significant Investment to Commercialize Technology for Virtual Advertising

Posted at 01:19 PM | Posted to Venture Capital | TrackBack | Permalink

March 24, 2006

France's Netcentrex Mulls IPO

With jobs open in marketing, biz dev, R&D, and sales, France’s Netcentrex, a supplier of xDSL and broadband gear, is obviously growing along with the demand for VOIP services, and today there’s news of an upcoming IPO.

Netcentrix co-founder and CTO Olivier Hersent has kept a key role at company despite several rounds of finance and acquisitions

Les Echos reports today that an IPO is in the works for the equipment vendor, whose sales in 2005 were €40M up from €26M in 2004, the year that it became profitable. Its chief executive told the French paper that sales of €60M are expected this year. There is no word on the bankers mandated for the transaction, a date, or the probable size.

The startup raised $34M from VCs including CDC Innovation Partners, Crescendo Ventures, Innovacom, and Newbury Ventures, among others. Founded in 1998, Netcentrex lays claim to providing its gear for over 2 million VoIP lines in commercial service.

It could be a sizable floatation. Les Echos reminds us that Netcentrex’s closest rival, Cirpack was acquired by Thomson, one of Europe’s largest technology companies, for an estimated €94M last year. According to the alarm:clock euro's notes, the year before it was acquired profitable Cirpack had sales of €15M.

Posted at 10:07 AM | Posted to Hardware | TrackBack | Permalink

Dotcom biz model with no name gets one

Fred Wilson in his VC blog described a few days ago his favourite business model. At the time, it was without a name. It's the sales stragegy that involves giving away free access to a service, or software, and then offering a more advanced version for a subscription fee.

Examples of online companies successfully managed this model include Skype for IP Telephony, Box.Net for storage, and Flickr, for photo storage. And examples of software companies, include firms like MySQL and shareware vendors.

At the end of the post he asked readers for suggestions of what to call the business model and he was provided with plenty. So far Freemium seems to be the one he's chosen.

There is no denying that Freemium is a trend right now, so we will keep you posted if a) the term catches on; and b) startups beyond this handful can repeat it.

And c) more importantly if any of them emerge as corporations in their own right, that is, they don't get acquired before they've become profitable and proven than this is a great business model over the long run.

The alarm:clock euro would also like to note that there are software companies at the other end of the spectrum that not only charge right off the bat for their software, but even charge for a demo.

You'll find pictures of the packaging and data flow diagrams but you won't find a decent screenshot at trend-bucking Kalido.

OK, it is only one example of a company that does both, but we're now looking more actively for other examples.

The startup in question is Kalido, a Benchmark Capital Europe portfolio company. An entry-cost license is $350,000; maintenance is $60,000 annually. That is a trend-bucking sales strategy if ever there was one.

We recently heard one of the top execs at Kalido speak on a tech venture panel. The firm spun out of Shell and has about ten years of R&D behind it. The spinout took a lot longer to pull off than the developer team hoped but now that it's independent, business is booming and expansion into the US market was the current challenge facing management.

Read - Kalido Interview (Daily Telegraph)
Read - My Favorite Business Model (Fred Wilson blog)
Read - The Freemium Business Model (Fred Wilson blog)

Posted at 08:42 AM | Posted to Business software | Online services | TrackBack | Permalink

March 23, 2006

Paper Battery Startup Charges Up First Round

Tornado Insider is reporting that Enfucell, a Finnish developer of disposable paper batteries, raised a €600K first-round for R&D and commercialization. Further details of the funding were not disclosed. The company was founded in June 2002 and spun out of the Automation Laboratory at Helsinki University of Technology.

Enfucell hopes its batteries end up powering smart cards, micro sensors, greeting cards, and other small, low power electronics.

There is another startup with a similar product, PowerPaper, based in Israel, which not only develops similar batteries but also developed several products on top of the battery tech, such as a wrinkle reducing gadget (pictured here) which delivers electrical current along with skin rejuvenating elixers.

PowerPaper delivers the PowerCosmetics line of beauty treatments.

Read - Enfucell receives first VC financing round

Posted at 04:31 PM | Posted to Alternative Energy | Venture Capital | TrackBack | Permalink

VCs Back Bulking Up of Napatech's Product Line

Copenhagen-based Napatech, a developer Ethernet adapter cards, said it raised $5M to acquire network adapter technologies from Xyratex, a firm that spun out of IBM back in 1994, now traded on the NASDAQ.

Napatech sells 1gig and 10gig Ethernet adapter cards that boost the networking performance of computer applications running data and processing intensive applications.

Several members of the management team and one of its backers are ex-Cisco executives.

OEMs are the target market for Napatech's gear

In 2004, Naptech raised €2.1M from Northzone Ventures and prior to that it had a seed round when it was founded in 2003 of less than €1M from private investors.

Read - Napatech Acquires Programmable Network Adapter Business and IP From Xyratex
Read - Napatech Receives $5 million Venture Capital

Posted at 03:59 PM | Posted to Hardware | Venture Capital | TrackBack | Permalink

France’s Bubble-era Entrerpreneurs Return En Masse

01Net, an online journal out of France (and not Journal Du Net as originally stated), has published this week a good list of French bubble era entrepreneurs that have returned to the fray. It is something that is happening all over Europe as we all know, and this list makes the case for France. It has the name of Gilles Babinet’s new venture wrong, it’s called Eyeka, but other than that it looks good.

Since the a:c euro has reported on the financing of some of the ventures listed, we note that several raised venture capital from some of the same investors (e.g. Modelabs and Eyeka) that backed their last businesses, which is kind of interesting to see.

Click to enlarge

Read - Internet Seduit Le Capital Risque (01Nett)

March 22, 2006

Nvidia's Buy Of Hybrid Graphics Gives Nexit An Exit

NVIDIA, a graphics processor vendor, announced it will acquire Finland's Hybrid Graphics a developer of embedded 2D and 3D graphics software for mobilephones and PDAs. Terms of the deal were not disclosed.

Hybrid is owned by key employees and two VCs, Investor Growth Capital, which invested in 1998 and Nexit Ventures, which invested in 2002. According to Red Herring, it raised a total of €2.5M.

The Finnish company, which was founded back in 1994, has a long list of clients including Nokia, Ericsson, Sony Online Entertainment, Texas Instruments, Renesas, Philips, Bitboys and Esmertec.

Read - NVIDIA Corporation to acquire Hybrid Graphics (press release)

Posted at 05:02 PM | Posted to Emdedded Systems | Wireless | TrackBack | Permalink

IMEC locks in capital for spinoffs

Belgium's IMEC, one of Europe leading semiconductor and microelectronics research institutes, now has a venture fund to seed spinoffs, according to EE Times. The fund is called Capital-E and it has €35.5M to invest in early-stage companies. And it has a contract that gives it first dibs on IMEC spinoffs.

Founded in 1984, it employs more than 1300 people and has expertise in solar cells, 200mm semiconductors, and high density packaging. In 2004, its annual sales were €159M. There have been about a dozen spinoffs from Imec in the last several years, including Sirius (acquired by Agilent) and Fillfactory (acquired Cypress Semiconductor).

A growing number of Europe's high tech research institutes are doing this kind of thing. It illustrates that they realize that there is a disconnect going on between the region's venture capital firms and the universities. The alarm:clock euro has been hearing for years from spinoff founders that there's a lack of venture money and support for commercializing breakthroughs. At the same time VCs, which have the know-how and the money to nurture early stage ventures, are often heard to be complaining about a lack of dealflow. Somehow the two groups have difficulties getting together.

Read - IMEC venture capital fund raises $43 million (eetimes)
Read - List of Imec spinoffs (imec web)

Posted at 01:28 PM | Posted to Venture Capital | TrackBack | Permalink

Asetek gets more cash to chill hot chips

Asetek, a Danish manufacturer of chip cooling systems, said today that it topped up its recently announced €4M venture round with an additional €2M in capital from KT Venture Group.

Asetek makes heat pipes or chip cooling systems. It is known among the Red Bull-slugging PC gamers and developers that use its high-end (read high-priced) bulkier products to prevent their overclocked central processing unit (CPU) from burning out.

The coffee mug-sized VapoChill unit on a motherboard.

But it now has a mass market product, the size of a coffee mug and the firm claims sales of a few thousand units a month via its Internet site.

The VCs invested because they believe that Asetek can keep shrinking the units so that vendors of silent, small form factor and home theater PCs will adopt the technology.

Like the name says, Hush Technologies, makes quite computer gear for the living room.

Competitors are also racing to reduce size, such as Zalman. And PC makers, such as Germany's Hush Technologies are also incorporating innovative heat sink technology.

KT Venture invests for KLA-Tencor, a major semiconductor equipment supplier. It said in statement that its knowledge of the industry indicates that there is a shift when it comes to cooling CPUs and that Asetek has "the cost-effective solution to this need".

In other words, the heat that chips produce is not being dealt with by the chip manufacturers and traditional fan/sink units cannot handle the thermal load (plus they’re noisy) therefore a plug in or add on device like Aseteks has a nice-sized opportunity.

Read - Asetek KT Venture Announcement (press release)

Posted at 01:07 PM | Posted to Hardware | Semiconductors | TrackBack | Permalink

Wazap founder on games portal and search

The alarm:clock serves up an exclusive interview with Andreas Ruehrig today. He's the co-founder of Eastbeam Group, the company behind Wazap, a German-Japanese games portal that also runs games search advertising business. In the Japanese market, Wazap has 70,000 users, according to the firm’s backer Wellington Partners in Münich.

alarm:clock euro Tell us about your past startups.
Wazap! AR The previous startups were gamez.de and uni.de. Gamez.de was the biggest gaming network in Europe in 2000. We sold the company to Gameloft, an Ubisoft spinoff. But with the crash in 2000 and the changed field of operation for gameloft (changed from online to mobile gaming) gamez.de was shut down and I decided to leave the company.

The other startup, uni.de, was the biggest student portal in Germany back in 2000 / 2001 when we sold it to Firstream, a French company that had plans to expand the business model world-wide and establish a large worldwide student community. I left this company in 2000 as an active manager to focus on gamez.de. By the way, uni.de is still online and generating revenue.

alarm:clock euro This is your third online venture, what is different this time?
Wazap! AR It`s my third online venture and it looks like that it could be the biggest. The venture money we got in the first round is the highest amount I raised so far. The reason that I believe it could be the biggest venture in total outcome is, that the field of activity is the hottest field right now (search and gaming) on the internet.

alarm:clock euro Was this the first time you raised venture capital?
Wazap! AR I raised venture capital money for all three ventures.

alarm:clock euro What was the most difficult thing to negotiate with the VCs?
Wazap! AR There were no difficulties in negotiating the vc round. The reason for that was, that more than one VC was interested in investing in wazap. We decided to go with Wellington based on a really good feeling about the people working for Wellington and their network, and of course the [Wellington's] speed of deciding to invest wazap.

alarm:clock euro Does Wazap search advertising product have much competition in Europe ?
Wazap! AR At the moment, we don`t have any competition in Europe. With our specialized gaming search we are unique worldwide. We will work together with the big players (google, yahoo, web.de, etc) for search ads and white label cobrands but also with smaller gaming portals and websites.

alarm:clock euro You already have an established user base in Japan. How did you manage that?
Wazap! AR To do business in Japan, you have to have Japanese people working for you and a lot of patience in negotiating business deals.

alarm:clock euro How many employees do you have? Are you hiring more this year?
Wazap! AR We have about 20 employees in Germany and 8 in Japan and we will hire new people this year.

alarm:clock euro What three tech ventures in Europe do you think are the most interesting right now?
Wazap! AR FON, openBC and Wazap!

Read- Wazap financing round (a:c euro)

Posted at 12:22 PM | Posted to Games (PC and other) | TrackBack | Permalink

March 21, 2006

Loss-making Sandvine completes buoyant IPO

Shares in Sandvine, whose products regulate and control traffic on broadband networks, climbed today on its first day of trading on London's lightly regulated AIM stock exchange. The IPO price of 75 pence gave the firm a valuation of €124M. The share price was up by 25 pence to 100 pence at the time this report was posted.

The equipment vendor, which hails from the same hometown as Blackberry-maker Research in Motion (Waterloo in Canada) raised £20M (€29M) in a placing alongside its IPO. Plus it found new owners for some £5M worth of old shareholders stock.

According to a report on TechFinance Canada, Sandvine was loss-making and had sales of CDN $15.8 million, up from CDN $3.2 million in 2004. Its losses before interest, tax, depreciation and amortization amounted to CDN $3.0 million, down from CDN $6.2 million in 2004.

Sandvine raised $38M from its venture backers, which included Celtic House Venture Partners, a fund that has taken several Canadian telecoms equipment public via the AIM.

Celtic's founder is Terry Matthews, an entrepreneur-turned VC who is well-known in London, which might help to explain why the share offering was so successful. Matthews was born in Wales but made his fortune in Canada after founding several telecoms equipment companies there. He has streets named after him in Canada's capital city and is known as Sir Terry in the UK.

Alongside Celtic, the firm attracted other backers, including VenGrowth Funds, Newbury Ventures, Waterloo Tech Group of Funds, Business Development Bank of Canada Venture Capital.

Read - Sandvine Completes IPO on LSE-AIM

Posted at 03:26 PM | Posted to IPO | Internet infrastructure | TrackBack | Permalink

German voice recognition tech attracts angels

VoiceTrust, a company that develops voice-recognition systems for user identification, has raised €2M to finance the development of a consumer-oriented product and to boost its international sales growth.

It tapped high profile German angel investors, Falk Strascheg, an entrepreneur turned VC (he founded one of Germany's first VC firms, Technologieholding, which was later acquired by 3i) and Boris Anderer, a co-founder of the once high-flying ecommerce software company, Brokat Technologies (he's also a venture partner at Wellington Capital in Munich), along wtih existing investors Avida and Grazia Private Equity.

A comparison of two voice profiles. Each is unique. The software checks 1200 of 200,000 possible data points in a voice print to authenticate a user.

VoiceTrust's technology has a lot of advantages over other biometric systems in that it doesn't need scanners, such as fingerprint scanner or iris scanners, or expensive face recognition software. Rather it uses a standard phone line and some servers running its software.

We've been in touch with VoiceTrust in the past and the firm's founder has had some harrowing experiences trying to develop the market for its technology, so it is good to see that he's found some smart money to grow the business.

A recent Time magazine article said that IBM had made a strategic investment in VoiceTrust, acquiring 5 percent of the company. IBM integrates voice recognition for password resets in its helpdesk applications that it sells to large IT departments.

Founder and CEO, Michael Kramer, decided to create VoiceTrust in 2001 after having his credit card details stolen by hackers.

Kramer's idea at the time was that he would develop software that would make such criminal activity impossible. But that particular application is not how the firm makes money today, rather the software is mainly used as mentioned above, for password resets, to identify and authenticate users phoning in to change their password if they've forgotten it or lost it.

Attempted break-ins, such as using a digital recording, are prevented by a challenge/response process, basically a live test with answers to random questions supplied by the system. Both Volkswagen and Microsoft have adopted VoiceTrust for this application.

With this round, the startup has raised €5M in outside capital, it said in a statment.

Read - VOICE.TRUST durch neues Venture Capital weiterhin auf internationalem Wachstumskurs (press release)

Posted at 01:55 PM | Posted to Biometrics | Venture Capital | TrackBack | Permalink

A new dimension in eyeball metrics

Tracking mouse movements on Ajax-web pages might be the next big thing among online advertisers (see Crazy Egg review below), but there's a Swedish startup that goes a step beyond that. Tobii Technologies tracks eyeballs, better said it tracks eye movement across a web page, or any other surface equipped with its sensor.

Professor Blignaut at South Africas' University of the Free State tracks the focal points of viewer's attention with blue dots in this sunscreen advertisement.
The eye tracking sensors are integrated into a standard display or a control panel, so there is no need to wear headset or any intrusive gear.

It is suited for operating equipment, such as a wheelchair or a PC, without the need to use your hands. But it also works for testing media or web applications.

CEO and co-founder, John Elvestjo, told the alarm:clock euro that sales are about evenly divided between these two applications. He also said that Tobii is profitable and had sales of €4.2M (40 SEK) in 2005.

Since it was founded in 2001, a time when European entrepreneurs continued to take risks but VCs did not, it has no venture capital backing. It managed to tap business angels for about half a million euros in that first year of business.

Tobii's tech tracks the user's gaze to identifiy hotspots or locations on a display that attract the user's attention.

Read- Review of Crazy Egg mouseover tracking

Read - Eyetracking and consumers (IFTF blog)
Read - Sweden's Fast 50 Deloitte

Posted at 07:12 AM | Posted to Advertising | Web 2.0 | TrackBack | Permalink

Interpeak acquisition an exit for Nordic backers

Two years after becoming profitable Interpeak, which develops and sells IPv4 and IPv6 security software targeted at mobile devices, has been acquired by Wind River for $20M.

Swedish Interpeak might have been identified as one of the 40 fastest growing tech companies in Europe last year by Deloitte but the deal size shows that middleware vendors are just not valued as highly as say a consumer-oriented dotcom company these days. Interpeak grew by more than 2000 percent in the period that Deloitte tracked it. Last publicly available annual sales information said it did €2.24M in 2004.

The six year old software firm raised at least €3.3M in VC. Its backers are Nordic-based, SEB and Ledstierman (owned about 20 percent).

Read - Wind River Acquires Interpeak (press release)
Read - Deloitte Top 50 (Embedded Computing News)

Posted at 07:00 AM | Posted to Wireless | TrackBack | Permalink

March 20, 2006

Wavecom firms up its M2M shift with acquisition

France’s Wavecom said today it acquired Sony Ericsson Mobile Communications' machine-to-machine communication business unit for €32.5M. The French wireless equipment maker, once a tech stock high-flyer, originally made mobilephone systems. After several years of losses it restructured its business, returned to profitability in 2005, and has shifted its focus away from cellphones to the higher margin M2M business, targeting industry, point of sales, and automobile applications.

This acquisition is in line with that plan. Its current market cap of €166 is just slightly higher than last year's sales of €130M.

Posted at 02:53 PM | Posted to Wireless | TrackBack | Permalink

Music to shop by attracts VCs

Pitango Ventures and Arts Alliance from the UK are backing WCD Multimedia with an $8.5M investment, according to Globes online. WCD is based in Israel and develops and delivers music, videos, and content for businesses such as restaurants, fitness centers, shops, hotels, and malls.

WCD believes that the right music can improve in store sales. The capital will be used to expand the business Western Europe and US markets. Globes says that YCD has been generating sales for several years. In August 2005, the company announced a $2 million contract with the UK Toyota agency.
Is this Muzak for the next generation?

Posted at 05:13 AM | Posted to Advertising | Venture Capital | TrackBack | Permalink

March 17, 2006

Alt energy a sizable market in Europe

Startups targeting alternative energy and eco-tech have a sizable market to address, one that is growing at a 5 percent rate, according to Europe's Environment Commissioner, Stavros Dimas who was speaking at the European Business Summit in Brussels yesterday.
Expenditure on eco-industries – which include hybrid cars and renewable energy technologies – accounts for 200 billion euros annually, more than two per cent of the EU’s GDP. The sector has experienced annual growth of around five per cent.
Read - Energy issues dominate eco-innovation debate
Read - The future is eco-technology

Posted at 05:41 PM | Posted to Alternative Energy | TrackBack | Permalink

Variations on BitTorrent from Peerfactor and Tribler

Several European teams are bent on making P2P file sharing more mainstream. Last week we wrote about Allpeers, which is now venture-backed. And this week we hear of Tribler in The Netherlands and Peerfactor in France.

The Tribler Team From TU Delft

Tribler launched a beta version of its P2P file sharing client today. Developed by a team of researchers with government funding at TU Delft, one of the top tech institutions in Europe, it is file sharing without the anonymity.

The theory goes that knowing whose resources your sharing will encourage users to open up their own PC and broadband connections for P2P.

Apparently even in the most popular P2P file sharing networks, only a tiny minority carry most of the traffic and data.

The improvements in store for Tribler users include an Amazon-like recommendations engine, real-time P2P file sharing with P2P video streaming, and a location-based omcpnent that shows the locations of other downloaders of the same content with city-level accuracy on a world map. "We are improving this protocol with over a dozen people with such features which go way beyond the original. We are extending the code from the ABC [Another BitTorrent Client] project."

PeerFactor comes out of France.

The firm says its software is created to enable webmasters to offer a legal downloading service and distribute large content more easily. It uses a client called microbittorent (ubittorrent) which is proprietary and developed by Ludvig Strigeus, a young Swedish programmer who has guru status among P2P experts. The users are anonymous unlike Tribler's concept.

Both Tribler and PeerFactor have to incentivize members of their P2P networks. PeerFactor offers gifts, such as subscriptions to Metaboli subscriptions to encourage people to open up their resources for file sharing. So far its client has been downloaded 7000 times since launching in France (only) this month and almost 4,000 users have signed up (agreeing to share traffic load).

The US web-site for PeerFactor is in still to come mode.

Tribler relies on a community of interest (friends and family) concept. According to Eric-Paul Scholten, the Dutch based founder of OGC Networks, a platform where online gamers bet on their skills, Tribler “has a lot of potential”, but it needs the consumer to support it with home-made video content, like "consumers have done with podcasting".
“It will all depend on the home-made video content and how well the social platform works,” said Scholten.
Read - Allpeers funding (alarm:clock euro)
Read - About microBittorrent
Read - PeerFactor Launch (peerfactor)

Posted at 08:43 AM | Posted to Online services | TrackBack | Permalink