alarm:clock euro

The alarm:clock euro takes a look at Intershop today in one of our periodic Where Are They Now? posts. We had been hearing one or two founders of Intershop, the former dotcom star, had left over the years, but we didn't realize until this week that all of them have now moved on to start new ventures.

The tipoff came from a paper published by Guido Buenstorf and Dirk Fronahl, two Max Planck Institute of Economics researchers. The two have examined the Intershop story and determined that some 27 startups can trace their roots to Intershop (many of them are located in the Intershop tower in Jena- image right). We have a link to it below and a list of Intership founders and their new ventures.

Intershop founders do the serial entrepreneur thing.

- Frank Gessner (open source mail order software founded in 2005)
- Wilfred Beeck (joined in 2002 bringing software product line for SMEs from Intershop) Update: URL and company name corrected. June 1, 2006.
- Karsten Schneider (operator of online photo processing sites for consumers acquired by HP in December 2005)
- Stephan Schambach (Woburn-based ecommerce on demand software company founded in 2004 backed by NorthBridge Venture Partners and General Catalyst Partners)

Intershop was founded by a team of entrepreneurs in 1994 who had the smarts to sell their software in the US just as the online retail market started to take off. It became one of the top 3 vendors of ecommerce software with sales peaking at €123 M in 2000.

Much was made about the founders growing up behind the Iron Curtain and the fact that they had raised venture-capital. They became famous founders. The startup went public with a fantastic valuation. Then the stock market bubble burst. Demand for its software tanked and so did its share price.

In the meantime, it has been called one biggest annihilators of investor money (a dubious distinction granted it by a German investor protection association).

According to estimates made by the association, stock valued Euro 10,000 at the end of 2000 would have a value of Euro 27 at the end of 2005.

Despite all that, Intershop is still in business, serving high-end large-sized companies with its ecommerce software. Its latest annual sales figure is €17.8M and is calling for profits this year and has started to hire staff again. Employee numbers had shrunk from 1200 at its peak to 219 as of April. It also announced in 2005 that it had settled the shareholder lawsuit that had been hanging over the firm.

Read - B2C - BUBBLE TO CLUSTER? THE DOT.COM BOOM AND SOFTWARE ENTREPRENEURSHIP IN AN EAST GERMAN REGION*

Posted at 07:24 AM | Posted to Where are they now | TrackBack | Permalink

Orchestria's Messaging Watcher

We talked to one of UK-based Orchestria's backers, Doughty Hanson Technology Ventures, recently and they had good things to say about the startup. Looks like eWeek also thinks the same, as it has named it to its Excellence list of the "top innovative and relevant enterprise" vendors of the year.

It is a list otherwise dominated by giants: Microsoft, Fujitsu, Lenovo, Bea, and the like.

Orchestria sells email and IM management software that can prevent users from sending a message or an email that they shouldn't.

With email scandals fresh in their minds, it is the investment banking sector that was the quickest to adopt Orchestria's tech. Customers include Goldman Sachs, Bear Stearns, and Lehman Brothers. The software is also integrated into Bloomberg's messaging app.

Based on policies that are pre-programmed, its software detects when emails or messages contain information that they should not, and either prevents them from being sent or makes the user think twice before pushing send.

Next target market is the pharma industry.

Read eWEEK Announces Sixth Annual Excellence Awards Winners (eweek)

Posted at 05:44 AM | Posted to News And Updates | TrackBack | Permalink

May 28, 2006

VC-backed Setanta To Raise More Cash

Publicly mulling plans to offer major sports content over free satellite channels and broadband to reach the magic audience numbers it requires to break-even, Setanta is putting the word out that it will need to raise more capital.

The pay TV group that recently ended BSkyB's dominance of live Premier League coverage confirmed yesterday it would screen matches on Freeview and broadband internet services as well as on cable and satellite.

Michael O'Rourke and Leonard Ryan, founders and joint chief executives of Setanta, dismissed suggestions from analysts that the company had overpaid for the rights and announced plans to launch a fresh round of fundraising for the company, which is 40% owned by venture capital firm Benchmark.

Setanta starts fund raising and seeks new investor (The Guardian)

Posted at 11:32 PM | Posted to Media | Venture Capital | TrackBack | Permalink

May 26, 2006

What Sort Of Startups eBay's Looking To Buy

In a Barron's article that repeats the familiar negative refrains about European entrepreneurship and VCs, there was a nugget about what type of companies eBay International's M&A executive, Gil Penchina, is looking to acquire and a word of advice for VCs that might be insisting on too quick a path to profitability.

Penchina says companies like eBay who use their valuable stock to buy new technologies, are rarely interested in acquiring revenues. Instead, he says, eBay is looking all over the world for certain businesses, such as local classified advertising Websites. Ebay's acquisitions represent a buy-versus-build strategy that covets large scale, robust technology and market-leading brands, Penchina says. .... The eBay M&A specialist realizes that financial backers, not entrepreneurs, place the revenue and earnings demands on young companies. He urged the audience to persuade their VCs to eschew early financial returns for rapid growth. New companies "need to get big fast," he asserts.

Read - European VCs Not Venturesome Enough (Barronsonline)

Posted at 05:20 PM | Posted to News And Updates | TrackBack | Permalink

OLED-T Takes Over Elam-T Assets And Gets Financed

OLED-T, a UK startup that has taken over the assets of ELAM-T, a display materials developer, has raised £3.8M in a deal led by E-Synergy, reports eetimes. Aberdeen Asset Management, Foresight Venture Partners and Gartmore Investment Management have also invested as part of the funding round.

The company makes materials for OLED displays that it claims have a longer life than competing materials. Capital will be used to fund an R&D facility to scale up chemicals production and hire staff

Read - OLED materials specialist gets funds, adds CEO (eetimes)

Posted at 01:21 PM | Posted to Displays | News And Updates | Venture Capital | TrackBack | Permalink

Esmertec's Bumpy Ride

A week ago mobilephone software developer, Esmertec, saw its share price take a dive on the SWX Swiss Exchange after issuing negative sales guidance. It’s share price and valuation are now down by 75 percent from its successful IPO pricing.

Esmertec's Stock Price Movement Since Its IPO
It is not unusual in today’s market to see a growth stock fall 30 percent on news of missing targets. (It is one reason that IPOs in the US have been shunned in favour of an M&A type exit).

But Esmertec's fell by much more than 30 percent last week. So what happened?

Our research shows that it was a combination of things: the negative sales news, changes in the top management, and an illiquid stock.

The stock was positioned as a high growth venture, so when the Javaphone software developer announced that sales would be 50 percent lower than expected in the first half, down to about $10 million compared with $20.1 million a year earlier, the stock market reacted accordingly.

It didn’t matter that the downward sales numbers was due in part to a move to focus on shorter term sales contracts meant to make revenues more sustainable. That notion was overshadowed by the news that competitive pressure was affecting the price for its flagship software product.

The negative sales guidance was mentioned in the same press release that said that the CEO was stepping down to be replaced by the COO.

That particular announcement came very close in time to news issued just the week before by Esmertec, that gave the dates for the scheduled departures of the firm's two founders and another C-level manager.

The firm's board was doing something that is not uncommon, switching out top management because they are not the right people for the job anymore.

"There is no exodus of management from Esmertec but an adaptation of the current team to the market changes; our technical team was java only and we had to adapt," said Jean Schmitt [Esmertec board member and Sofinnova partner].

But the press here and shareholders didn't see it the same way. They saw it as the top level management jumping ship.

And because Esmertec is a fairly illiquid stock, something confirmed by a Zurich based investment bank, a selloff resulted that battered the share price.

Venture backers are still holding Esmertec stock and retain the same amount of shares stated in the startup's 2005 annual report, according to Esmertec's IR executive, Deborah Choate.

Schmitt said:

Sofinnova and Earlybird to my knowledge as well did not sell shares; we are supporting the company and are believers. The company has lots of great assets, lots of customers, lots of new opportunities.

Hopes are pinned on the company executing on its new strategy under the leadership of the new CEO Jean Claude Martinez.

"Jean Claude is the leader of the company; he is not a show man but an execution animal," commented Schmitt.

Esmertec is a vendor of embedded systems for javaphones. It was founded in 1999 and completed about half a dozen technologies acquisitions over the years, a veritable low-budget rollup machine with a strong focus on consolidating JVM developers, which enabled it to grow to $40M in annual sales and achieve profitability before going public.

In late January the firm announced it was having difficulty collecting royalties and that it was adapting its accounting methodology to deal with that. It also said that expenses were on the increase due to investment in Chinese and Japanese R&D.

In Februrary it said it would open a new market segment beyond the handset, the mobile network operator market. It kick-started this move with an acquisition in France, Cellicium.

The next scheduled newsflow from Esmertec is expected at the end of August. By then it will be clearer how the firm is doing reducing its dependancy on the Java embeded product and if it has found a way to generate more reliable revenues.

Posted at 08:50 AM | Posted to News And Updates | Software | TrackBack | Permalink

May 25, 2006

Vencap's List Of Euro Tech Pioneers

We came across a slide from a recent presentation by Vencap International making the case for European VC. Vencap International is a fund of fund manager, that is, it invests in VC funds.
Here's its list of the current crop of European VC-backed tech pioneers, basically companies whose products break new ground in the tech sector.

We agree with most of its choices, although it is not an exhaustive list. What's interesting to note is that several alt energy startups are in the mix.

Posted at 04:48 PM | Posted to News And Updates | TrackBack | Permalink

IPO Will Give Trolltech's Trolls A New Reason To Dance

Trolltech has filed to go public in Norway, according to a post in today's PE Week Wire. The developer and distributor of professional software development tools for Linux phones and devices, which has been making the moves that presage a float, such as expanding its board and hiring C-level execs, has filed with the Oslo Stock Exchange.

If Linux takes off in the mobilephone market the way the firm hopes, it will be a startup to note.

Trolls forming the Qt 4 logo in the Qt 4 Dance music video

But we say that Trolltech already has dibs on a place in tech history because it is one of the first where employees created their own music video upon the release of a new version its software. The image above is an outake from it.

Founded in 1994, Trolltech raised an undisclosed amount of VC in 1999 and a series B round of $6.7 million about 16 month ago in a deal led by Index Ventures, joined by previous investors Teknoinvest and Northzone.

View - Qt 4 Dance Music Video [Needs the Quicktime 7 preview to play]

Read - Trolltech has filed an application for listing / (press release)
Read Trolltech has filed(PE Week)

Posted at 04:03 PM | Posted to IPO | News And Updates | TrackBack | Permalink

Benchmark Takes Stake In B2B Music Platform

Ricall, which runs an online platform for music research and clearing licensing rights, has raised an undisclosed amount from Benchmark Capital's European fund.

The deal was announced a few weeks ago, but the a:c euro just came across it today via an announcement that it won what we'd call an outsourcing contract from Five, a UK TV station. The contract gives Five a fully managed digital music facility for in-house staff.

The move into providing managed services for broadcasters looks to be new, as its typical transactions, listed on its website, are for single titles. For example, it cleared Britney Spears Oops I Did It Again for Gala Bingo, The Who's Won't Get Fooled Again for Swiss bank UBS, and Sugababes' Push The Button for Heart FM.

Founded in 1998, the firm said this was its first round of institutional funding. Ricall's platform brings together professional buyers and sellers of music to enable licensing of titles for use in advertisement, films, TV, video games and the like.

The deal was led by Ynon Kreiz, who joined Benchmark Capital Europe's team as a GP about a year ago. He is http://www.ricall.com/index.cfm?fuseaction=newsdetail&asset_id=51&type=1also the founder of Fox Kids Europe. This is one of several media-related he has closed in recent months.

Kreiz said in a statement:

"Ricall has a highly experienced management team and has created a market-leading online service that has proven its value to an impressive and growing client base. Ricall is poised for rapid expansion and we are delighted to be able to play a meaningful part in that."

Posted at 03:36 PM | Posted to News And Updates | Online services | TrackBack | Permalink

German Publishers Bring On Google Print Rival

Two associations of German book publishers are asking members to join an effort to make the full text of their books available online in a new full text database.

A prototype of the project is expected to go online in October and it will cost about a million euros, according to a report in PTE.

While scenes like those on the right are not about to disappear from society, book publishers in Germany are taking pains to make sure they keep control over their online version of their content.

The technical leads on the project are two subsidiaries of Holtzbrinck, namely hgv publishing services und MPS Technologies, based in Delhi.The plan is to eventually create a retail business selling electronic versions of books.

It is all about control. Here's what the initiators said:

The companies Google and Amazon are offering to deal with this task for publishing companies
by providing the digitisation, storing, search and limited presentation of full texts on their respective websites, to be followed by options linking to the corresponding sales channels. With these proposed solutions, control of access to book contents is restricted to these providers.

Read -
Volltextsuche online: Prototyp im Oktober 2006
Read- Fulltext Search Online Project (press release)

Posted at 08:02 AM | Posted to News And Updates | TrackBack | Permalink

May 24, 2006

Rebtel's Global Mobile Calls At Local Rates

Swedish startup Rebtel generated some buzz at Innovate Europe last week. We got around to checking it out today.

Besides having a corporate identity that looks a bit like the old Credit Suisse one, we think that this is looking like a service that will catch on with consumers and small businesses that want to avoid the high cost of international calls from mobilephones.

Rebtel requires users to enter their contacts' names and numbers and then assigns each party a local phone number to call. The local number is sent by text message to each party.

It doesn't require a callback like Jajah does. And it doesn't require a PC or special handset like Skype does. The service costs $1 a week, plus an interconnect charge that it promises to keep "low".

Rebtel has a cheap and efficient way of acquiring new customers for a VOIP service and handles mobilephone users well.

Maybe Vonage, which does not have a cheap and efficient way of acquiring new customers, could learn a thing or two from this Swedish startup.

Rebtel was founded in January and has offices in Luxembourg, Sweden, and Redwood City, Calif. It is founder-funded.

Read - Innovation in telephony (Florian Dargel Blog)

Posted at 04:37 PM | Posted to News And Updates | TrackBack | Permalink

Paris-based Galileo Back Open Source Startup

French blog, Altaide, alerted us to a €2.1M venture capital injection into open source software startup Talend by Galileo Partners.

We would describe Talend's flagship product as open source data integration software, a form of middleware. It is ideally used in datawarehousing, grid computing, and datamart environments.

Looking at a recent presentation by Talend, it clearly aims to compet with commercial software venors Informatica, Sunopsis and DataMirror. MySQL is a reseller of Talend's software.

Read Press release from Talend (Chausson Finance blog)
Read Talend une star ( Altaide blog)

Posted at 10:55 AM | Posted to News And Updates | Software | Venture Capital | TrackBack | Permalink

Strangely Spotted Dog At Movistar

Telefonica's new brand for its moble services targetting Spain and Latin America, Movistar, has won accolades from Brandchannel for its marketing efforts.

Now take a look at Movistar's latest ad and guess who provides the search default for its mobile Internet homepage as of this month.

Google has quietly been signing partnerships with mobile network operators for mobilephone search over the past year. Movistar is the latest to go live. Other recent deals include T-Mobile and KDDI. On Google's corporate website, it claims to be working with AT&T Wireless, Sprint PCS, Nextel, Palm, Handspring, and Vodafone, too.

We're not sure how much people use the search on their phones but Google is certainly making inroads. Anyone have any thoughts on how Google's growing position in moblie market can affect startups?

Read - Brandchannel's ranking for brands in 2005

Posted at 07:52 AM | Posted to News And Updates | TrackBack | Permalink

The Jag Mobilephone

After panning Siemens' vision-in- pink effort to design a phone for women, ARCchart, a wireless market research and consulting firm, commissioned Ocean Observations to design fashion phones based on the brands of Diesel, popular clothing line, and Jaguar, the lux automobile brand.

The project was not sanctioned by either of the two companies, so Ocean derived design platforms for GUI and industrial design from their own research.

They say it should "only be seen as a study" but it shows the way that some people believe phones are going.

This might get people to buy new phones, but we're not so sure it will make them use the services more. There needs to be some serious improvements on phone configuration for Internet access, not to mention more thought into pricing plans.

We think that the new breed of virtual mobile network operators (MVNOs) emerging here and elsewhere will be doing some disruptive things. The alarm:clock euro has been contacted by a few of the founders of such startups and we will be profiling these agents of disruption in the coming weeks.

Read - Pink is the new grey
Read - Ocean Observations: our work

Posted at 07:19 AM | Posted to Wireless | TrackBack | Permalink

May 23, 2006

Ask Us Any Question As Long As You're In The UK

A UK mobilephone service startup says : Ask us Anything...

82ASK gamely offers to answer anything, except something illegal or offensive. Some examples:

Where can I buy a pink silk tie in Leeds?
In its interim results what was mmo2’s half year revenue and profit?

The service, only available in the UK at the moment, replies to users by text mesage. The answer costs £1.

Re5ult is the company behind 82ASK, and was founded by Sarah and Thomas Roberts, two former investment bankers. It is angel and founder backed. Business must be good because the company is hiring and has a few jobs on offer for what it calls "Textperts", people that sort through the questions sent in and answer them in a concise way, only 160 characters to work with, we note.

Posted at 03:57 PM | Posted to Early stage | Wireless | entrepreneurship | TrackBack | Permalink

Eutelia buys Getronics' Italian Unit For One Euro

Italian telco Eutelia has acquired Getronics' Italian operation, Getronics Solutions Italia (GSI), for one euro. With sales of of €221.9m in 2005 and a net loss of €74.8m, Getronics Italian unit, which employs 1800, was deemed not worth keeping by Netherlands-based Getronics.

Read - Eutelia acquires Getronics Solutions Italia (Ovum UK)

Posted at 01:48 PM | Posted to News And Updates | TrackBack | Permalink

France's Tagsys Moves To US, Raises Pre-IPO Round

French RFID systems developer, Tagsys, which recently moved its HQ to the US East Coast, is expected to announce today that it has raised $35M in what it hopes to be its last round before going public.

The round was led by JPMorgan Partners and brought in one other new investor, Cazenove Private Equity, as well as the previous investors Elliott Associates and Endeavour. Terms of the deal were not disclosed, but Bernard Vogel chairman of Tagsys' board and managing partner at Geneva-based Endeavour, the startup's earliest investor, told the alarm:clock euro that it was a 3-digit million valuation, which was an up round over the previous one.

Vogel added that this round is the pre-IPO round, expected to take place within 12 to 18 months.

Tagsys Customer, Pfizer, Is Using RFID To Combat Fake Viagra Floggers

The reason investors are bullish on this 5 year old company is that it has been winning some pretty hefty sized sales and hardware integration contracts, in particular it won the first commercial rollout for RFID labels in the pharmaceutical industry with Viagra-making Pfizer.

It has also recently won a deal with Pfizer-rival GlaxoSmithKline, according to Vogel. The RFID pharma market is a hot one now that the regulatory authoritiy for the drug industry in the US, the FDA, has mandated all drug companies to use the tagging systems instead of barcodes.

"This is the breakthrough that the RFID sector has been working towards - the first high-volume application for item level RFID tags," commented Bernard. What he means by "item level tags" is the RFID labels that go on every single bottle of pills.

All The Places RFID Tags Are Used

Companies like Alien Technology, which recently filed for an IPO, deliver RFID technology too, but their core business has been tags for tracking and tracing palettes and containers. The item level application is a higher volume one and explains investor interest in Tagsys.

Tagsys is on a roll for the time being, but there are lots of competitors in this market as RFID has been attracting quite a bit of VC money (see a roundup of recent Euro RFID deals in the link below). And Alien Technology is not sitting on the sidelines: it recently announced a tech partnership with Vue Technologies to enable it to address the item level tagging market.

If all goes according to plan, the IPOs of both these companies should make for some lively competition and some serious money flowing into an emerging tech market.

Read -Alien Technology Valued At (a:c)
Read- VC Euros flowing to RFID startups (alarm:clock euro)

Posted at 09:00 AM | Posted to News And Updates | Venture Capital | TrackBack | Permalink

Intel Capital: Wimax Telco Tycoon

If Wimax takes off the way that Intel is hoping, it won't just be a chipmaker anymore, it'll be a shareholder in a number of growing alternative telecommunications companies, practically a telco tycoon via the efforts of its corporate venture capital arm, Intel Capital.

We're saying that becuase Intel Capital has just announced backing two more municipal telecoms operators that have Wimax ambitions.

Both Orascom Telecom WiMAX Limited, a joint venture with Orascom Telecom of Egypt, and Worldmax, a joint venture with Enertel Holding of the Netherlands, will be getting some capital and tech know-how from the chip giant.

The deals are conditional on some undisclosed approvals and criteria.

These two follow several others in the UK and in Germany earlier this year (follow links below).

Intel's hoping that Wimax is going to be deployed all the way from the backhaul to the end user device.

Its kickstarting the market for Wimax chips has the side effect that several startups, such as US-based Aperto, an access network systems provider, along with UK-based PicoChip (Pond Ventures, Scottish Equity Partners, among others), a wireless chipmaker, and Ubiquisys (backed by Atlas Venture), a wireless network access box-maker, may feel market demand earlier than they could have normally expected.

Read - Intel Capital Extends WiMAX Investments Worldwide
Read -Intel backs second Wimax (alarm:clock euro)

Posted at 07:14 AM | Posted to News And Updates | Wireless | TrackBack | Permalink

May 22, 2006

Streaming Map Tech From Sweden

When someone steals your car or your boat, this startup's technology can show where your gear has gone.

Easygard (shown here) is one product that is based on a new mapping engine developed by Swedish startup, Idevio.

It claims a greater than 10 times improvement on the compression and publishing of digital maps. In fact, it says it reduces the size of topology databases by 90 percent.

Since Scandinavia has a few freshly capitalized VCs, we're wondering why this startup has escaped their purview.

Read - RaveGeo Powers Easygard

Posted at 03:27 PM | Posted to Wireless | TrackBack | Permalink

vpod.tv Founder On The Business of Online Video

Rodrigo Sepulveda Schulz is the co-founder of vpod.tv, a nine month old European online video publishing and distribution service provider. We talked to him about his business model and the firm's strategy after he announced a €5.1M first round commitment from Innovacom*.

Anyone who has been to a tech ventures event in Europe in the past year will recognize the gregarious Sepulveda Schulz and his ubiquitous slab of electronics.

First point, although the functionality of vpod.tv is similar to that of YouTube and Google's venture in this area, the French entrepreneur is not planning on taking them on in the US market. The focus is Europe.

It's not as weak an approach as it sounds at first hearing. Kellkoo, an online shopping directory, took that approach and it managed to achieve a valuation of €500M by the time Yahoo acquired it in 2004. It was also backed by Innovacom, among others, pointed out Schulz.

Second point, vpod.tv has a viable business model. It is set up to support three revenue streams. For the consumer market it will insert super short ads into selected videos via its own ad serving technology. The startup hired a team from TVMadrid to do the development, confirmed Schulz.

Publishing and distribution of videos is free for consumers but users have to agree that vpod.tv will insert ads into their content, either at the beginning, middle, or the end. A revenue sharing model is the plan.

Not all video pulbishers will want to have ads inserted into their content, goes the theory, so they will pay not to have ads. The payment scheme is not being disclosed yet but will be a based on a volume/traffic/file size calculation. vpod.tv already has a first customer in this category, a FilmFestival.com, an organization with 40,000 members.

A third category of sales is targeting online retailers to encourage them to make their own videos of products and product demos. "We can offer ecommerce sites time and costs savings," said Schulz.

The startup has a peer-to-peer technology partner to save on its bandwidth costs and is working with a US-based content distribution network, also to manage bandwidth, but it is not disclosing either name yet.

Services like vpod.tv and its rivals are set up to be easy for mobilephone users to shoot send and publish videos.

But a spoke in the wheel for this concept is the cost of using wireless networks for video file transfers. "The price for GPRS is outrageous," comment Schulz. He believes that new MVNO will focus on data service and offer some smart packages for consumers that want to use the networks for video file transfers, which should boost the use of his company's video platform.

In the meantime, the founder is travelling Europe and the US to sign customers and advertisers for vpod.tv, aiming to win a chunk of advertising sales away from traditional television and broadcasting channels.

Update: At least two rivals exist in the French market with a similar approach to video publishing online, Banex Ventures-backed Kewego, and DailyMotion.

(*Ed. We reorted earlier that the Innovacom invests on behalf of France Telecom, but that was not correct. FT owns a share in the management firm Innovacom. And Innovacom has a mandate to manage an older Orange Ventures portfolio. But the firm's funds are invested and raised independently of the telco.)

Posted at 11:22 AM | Posted to News And Updates | Venture Capital | TrackBack | Permalink

Scottish VC Goes To Europe On Back Of Home Runs

Scottish Equity Partners (SEP) is close to closing a new tech fund with a remit to invest in the UK mainly but also will add European ventures this time to its mix.

It would be its 70-times return-on-investment in semiconductor manufacturer Wolfson Microelectronics, that has helped the Glasgow and London-based firm garner commitments of €120M on its new fund that will back between 25 and 30 companies.

SEP, which also backed another poster-child of Euro tech VC investment, Cambridge Silicon Radio, a Bluetooth chipmaker with a market cap of £1.6B (€2.35B). Its style of investing covers semiconductors, healthcare, and energy sectors. It does both early stage and later stage investment, it said in an interview in the Scotsman this weekend.

Current portfolio firms includes goodies like the mobile portal software firm, Surfkitchen, and Wimax chipmaker, PicoChip.

A rare insight into the VC fundraising process was provided in the newspaper's report. We have the quotes below.

Not every venture capitalist has to pitch for funds, but Paterson suggests that they should: "It is remarkably good for the soul to have to sit on the other side of the table and make your case. I would recommend it as a process of improving self-awareness for all venture capital professionals.

...At times, it felt a bit like Groundhog Day, but it was a pretty quick and efficient process. Language has not been a problem - I did think about taking some lessons to brush up on my very basic French, but it was suggested that I should try to master English first!

...Paterson emphasises that SEP will not rush into a string of overseas deals. He says: "I strongly believe that to do VC well, you have to spend time with your portfolio companies and invest in other ways than money. Some of our competitors are investing on a pan-European basis and in the US. That is okay, but there is no compelling evidence that works any better than focusing on one country."

SEP's own investors are more cosmopolitan now - the last time the firm raised money, all of its backers were based in the UK. This time, traditional supporters such as the Royal Bank of Scotland were joined by investors from France, Germany, Luxembourg, Switzerland and Belgium.

We know that SEP has been moving towards more independence from its original parent company, Royal Bank of Scotland, but are not sure how far along in the process it is now.

Read - Venturing further afield(The Scotsman)

Posted at 06:32 AM | Posted to News And Updates | TrackBack | Permalink

Benchmark Europe Backs Classmates Clone Bebo

Saying they are trying to pick the next Yahoo, Benchmark Capital has taken a $15M stake in Classmates.com clone Bebo, based in the UK with the plan to take it to the US. No disclosure on terms but we note that the founders still own the largest stake in the company.

According to a report in the Guardian, Bebo has been winning market share in the UK from MySpace and is now the number two to MySpace's number one.

As alarm:clock, our sister site, has been reporting there is plenty of competition already in the US market. We're wondering what it is that makes Benchmark think this British upstart has a chance. Its London team has at least one partner with a strong television industry background. And both of the big exits in this field have been driven by TV companies, Friends Reunited was bought be ITV and MySpace by Fox Interactive - is that the direction they will go with this one? And as for saying they want to back the next Yahoo, we say: who doesn't?

Read - Setanta backers spend $15m in search for the next Yahoo (Guardian)

Posted at 05:38 AM | Posted to Media | Venture Capital | TrackBack | Permalink

vpod.tv Takes On Cash For Online Video Biz

vpod.tv, a startup based in Paris that hosts and publishes videos has a €5M commitment from Innovacom, which does VC investments for France Telecom and mobile network operator, Orange. We'll be updating this post after our scheduled interview with the founders later today. In the meantime Om Malik has some thoughts on the startup.

Read - Fellow Blogger, Broadband Fanatic (om malik)

Posted at 05:29 AM | Posted to Broadband Services | News And Updates | Venture Capital | Web 2.0 | TrackBack | Permalink

May 21, 2006

Difficult Times For VC-backed Esmertec

Mobilephone software developer, Esmertec, is now valued at SFr 79M after its share price fell by over 50 percent on Friday on the SWX Swiss Exchange. When it floated last September, one of the first venture-backed IPOs here since the bubble burst, the market valued it at SFr 288M.

The stock was positioned as a high growth venture, so when it issued a press release on Thursday that said that growth was not on track, the market reacted.

Check back. We're looking into the latest turn of events at the acquisitive seven-year old mobilephone software developer.

Posted at 07:27 AM | Posted to News And Updates | Wireless | TrackBack | Permalink

Euro Kitchgeist And P2P Live Streaming

Lordi, Lordi, that's the chant that welcomed the Finnish winners of this years' Eurovision Song Contest when they performed last night in the Eurovision Song Contest, an event that was live streamed via peer to peer tech from Octoshape and broadcast to an estimated audience 100 million.

Lithuania's We Are The Winners Song Failed To Convince

Andorra's Team Forgot Their Costumes And Didn't Make The Finals

The Ukraian Brittany Spears- Shakira Did Not Win


Finland's Lordi Did
The schlock "horror" band received the top prize at the more than 50 year old event that pits 38 nations against one another in pursuit of fame.

The BBC said that the Big Four countries (France, Germany, UK and Spain) were accused in recent years of not taking the contest seriously, but we suspect no one has taken it seriously in the past few decades.

Voting was by text messaging and "100 percent democratic", said the shows organizers. Viewers paid premium SMS prices for each vote and the maximum number of votes from one number was 20.

The a:c euro notes that this year's show was broadcast live on the Internet using new Peer-to-Peer realtime software from Denmark's venture-backed Octoshape, a sign of the times in our eyes, the contest was originally launched back in the fifties to promote a newfangled technology called television.

Audio, video, and photodownloads are also available on the Eurovision.tv web-site.

In the tradition of Big Brother, which originated in Netherlands, the US market is apparently going to adopt the format, according to an Associated Press report. NBC announced plans earlier this year to replicate the formula in the US with acts from different states competing for viewers' approval.

Link- About Octoshape

Posted at 05:42 AM | Posted to News And Updates | TrackBack | Permalink

May 20, 2006

Something In Common With 1998

BusinessWeek's article, "It Feels Like 1998 All Over Again", looks for signs of a Silicon Valley venture bubble.

The only thing that we could see from our Euro vantage point that was like 1998 "all over again", besides a certain mushrooming of consumer Internet startups, was that Europe had more IPOs activity than the US had last year, just like it did in 1998.

In 2005 Europe's public capital markets raised more new money in IPOs than the US and Greater China combined, according to PriceWaterhouseCoopers. And in 1999, corporate finance boutique, ICON, published that little icon noting a similar outperformance on the IPO market in Europe, driven mainly by telecom, media, and tech stocks.

There is a key difference between now and then:in 2005 the IPO numbers were driven by several other types of stocks: telcos yes, but oil and gas companies too. Bank floatations and food corporations were also in the mix. So we doubt the observation has much relevance.

Read- PwC IPO Watch 2005

Posted at 11:30 AM | Posted to IPO | TrackBack | Permalink

May 19, 2006

What It Takes To Sell WiFi: Bunnies and Social Routers

We've been watching vpod.tv's coverage of Innovate Europe and this little WiFi guy was the buzz of the show.

It's the heart of a social networking service called Nabaztag, from French startup Violet,

which was founded by this straightalking guy, Rafi Haladjian,

who is also the founder of this Wifi telco,

which competes with this Wifi telco,

which doesn't have a bunny, but does have one of these.

It's Friday and we didn't have the bandwidth to find out what Fon means by "social router" (the WiFi router above), so if any Foneros read this, do tell.

Posted at 11:47 AM | Posted to News And Updates | Web 2.0 | Wireless | entrepreneurship | TrackBack | Permalink

Personal Beamer From Cambridge

University spinoff, Light Blue Optics, in Cambridge, England, has reached the demo stage of its match-box sized personal beamer. It's only black&white for the time being. But the plan is to develop the tech so that a mobilephone, laptop computer, personal media players such as the video iPod™, and digital cameras can be used to project videos, photos, or clips forviewing on a larger display area.

The startup raised seed funding from angel investors in 2005.

There are a few teams in Europe that are working on similar components for small-sized projectors, such as Upstream Engineering in Sweden (image below of non-working models), which raised a seed round from Holtron Ventures over a year ago. Holtron is the same firm that backed MySQL in its early days. And there's an R&D team at the Fraunhofer Institute that have demonstrated a cigarette-pack sized projector.

But the progress in commercialization seems to be slow.

Posted at 09:26 AM | Posted to Hardware | TrackBack | Permalink

Secretive Mangrove Seeks Search Startups

Mangrove Capital, one of Skype's first round investors, is a very secretive fund -- doesn't publish its portfolio and doesn't do PR -- so vpod.tv's interview at the Innovate Europe conference this week with founding partner Mark Tluszcz (who's in a decidedly upbeat mood) is a bit of a scoop.
What's he looking for? A better search technology.
No fear of risk there, folks.

Link - vpod.tv Interview with Mark Tluszcz

Posted at 07:36 AM | Posted to Venture Capital | TrackBack | Permalink

US Dominates Additions To Silicon60 List

Here's an interesting factoid. All the new entrants to EE Times Silicon 60 list of up and coming semiconductors are based in the US, exept for one, Light Blue Optics Ltd. (Cambridge, England).

While many of the startups that are on the list for the second, third, and even fourth time are from Europe and other parts of the world, the first timers this time are mainly from the US.

Can we draw any conclusions from this development - is Silicon Valley flexing its IP muscle - are other regions lagging in innovation? We asked Peter Clarke at EE Times who manages and edits the list.

The short answer is, no.
"... I don't think you can read that much into it. This is a noisy signal," said Clarke.

So what does the lone Euro new entrant to Silicon 60 do? Nothing less than developing the guts for personal video projectors that are low-power enough to be embedded in mobile phones. We've got a post on it coming up later.

Read - EE Times updates list of emerging startups (eetimes)

Posted at 06:42 AM | Posted to News And Updates | TrackBack | Permalink

May 18, 2006

Tornado Insider Says No Bubble

Tornado Insider's latest newsletter looks at its tech deal database, probably the only one fed exclusively on a diet of European and Israel transactions, to see if there's a new Internet bubble forming.

The short answer is no.

Investment in pure Internet plays has increased slightly from the lows in 2003. Anecdotal feedback is that business plans for this sector are not been immediately rejected, as was the case a couple of years ago. However, the level of Internet funding is just a fraction of the funding recorded 5 years ago: 2% of the total amount, and 8% of the number of deals. Even with the prospects of an improving exit market and abundance of quality business plans, European VCs still seem hesitant and risk-averse

But there is clustering of investment around certain categories of online services. Tornado's analysts note that there were three financing rounds of online music providers closed in the past 10 days. And in the 15 February to 28 March period, online retail racked up 5 deals, while content sharing providers generated 4 deals. And there was one other outside of that period (late January).

Tornado concludes:

It seems that the herd mentality is not dead, but is not as excessive as 5 years ago. However and as always, those VCs with the guts and vision to invest first in the truly innovative new businesses will continue to win big.

We would add that you cannot have a VC bubble unless you have a lot of capital sloshing around and as we know from keeping track of new funds raised, excess capital is not an issue in the European VC market.

Read -Is there a new Internet bubble emerging in Europe? (Tornado Insider Newsletter)

Posted at 05:46 PM | Posted to News And Updates | TrackBack | Permalink

Ring2 Will Be Ringing Up VCs For Blackberry Conf Calls

Ring2,which offers audioconferencing services and software to manage calls, is going to be seeking funding this year to support "anticipated growth", according to a report in Computer Business.

The UK startup's software enables the initiation, muting, device switching, invitations, and general management of conference calls from a Blackberry device or a PC. It is integrated into its audioconferencing call service, which charges about 25 cents a minute for conf calls.

Shot from slick animated demo which offers a quick understanding of Blackberry app features
Ring2 was founded in 2003, raised an undisclosed first round of venture capital and seed funding from angel investors. It is London-based with an office in San Francisco.

Can innovation on the front end be enough to attract new customers to the Ring2 audioconferencing service? Is it a big enough market opportunity for VCs? We are not sure, but we'll keep our eye on Ring2.

Read- Ring2 Launch Conference Calling For Blackberry (Computer Business Review)
View - Ring2 Demo

Posted at 03:47 PM | Posted to Wireless | entrepreneurship | TrackBack | Permalink

TeliaSonera Buys Broadband Rival - VCs Exit

Several press sources are reporting that TeliaSonera AB has acquired NextGenTel, the second largest broadband provider in the Norwegian market. Much of the shares acquired were bought from VC-backers Northzone Ventures, which had seed funded the company in the pre-revenue phase back in 2000, Geocapital, and the other major shareholders.

The price paid values the company at NOK 1.9B (€243M)

According to TotalTelecom, among the sellers are also members of NextGenTel's management team, including Chief Executive Officer Olav Stokke and Chief Financial Officer Odd Bjoern Ur. The team will, however, remain with the company. No management changes are planned.

Nextgentel's stock was listed on the Oslo Exchange in December 2003, one of the few tech stock IPOs that year.

Read - Teliasonera has increased shareholding in nextgentel to 90.5 percent

Posted at 09:22 AM | Posted to Broadband Services | News And Updates | TrackBack | Permalink

Bashing European VC

One of the blogs we read, Infectious Greed, has a post entitled Trashing Euro VC, which compares historical performance of the two regions. We've seen versions of that slide a few times over the years. It's particularly popular on panels populated by limited partners where European VC bashing is the norm.

But the barrage of snarky one-liners has slowed a bit. Here's what a few LPs were saying this week at the DowJones Limited Partners Summit in Zurich:

Kathryn Abbott, Managing Director, Horsley Bridge.:

If you’re looking at past track records you’re not going to invest in Europe. We don’t invest based on geography [no forced allocation to a geographic region]. If the top 25 performing VC fund managers were based in Poland that’s where we’d invest.

It’s a bit contrarian to look at Europe right now, but we think it is a nice time to invest... Some post-bubble vintage funds are performing in line with their US peers. That’s never happened before.

Rho Fund Investors, Gordon Hargraves:

European VC is interesting now…based on portfolio companies. There have been some interesting exits. No excess liquidity in the market. It’s undercapitalized and there is less competition for deals...
… Among the few managers that can execute, the dealflow is there.

It's not a sea change of opinion because these LPs we've quoted are pretty specialized and are known for targeting VC. They are the type that back qualified first-time funds, and they like niche styles. They'll be following the money, though, not the rhetoric.

Read - Trashing Euro VC (Infectious Greed blog)

Posted at 07:22 AM | Posted to Venture Capital | TrackBack | Permalink

May 17, 2006

Sound-tracks For Online Slideshows And Blogs

Calif-based Sonific has raised seed financing from US and UK based business angels of less than $2.5M. It is a media deal but because a lot of our readers have blogs, we’ve looked into it a little more closely than normal. Plus its founder is a European who lives part of the time in Basel.

Sonific's founder is Gerd Leonhard, an author and entrepreneur specialized in the muisc business. His last venture was LicenseMusic.com, a "typical dotcom", he said, one that is however still in business. He started up Sonific last year to provide licensed music to blog owners, people that photo albums online or websites that want to provide background music to their visitors.

A link from the site takes visitors to the catalog of music of mainly indepedent and lesser known musicisans (that want to become better known) on sale from Sonific. If a visitor purchases a track, the blog owner receives a share of the sales. The affiliate marketing scheme is not going to be available for at least the next four months, said Leonhard, but the Sonific service is to go live within the next two. It's a global market, with strong prospects in East Asia, according Leonhard.

Link - Example of music integration as banner-ad in blog.

Posted at 01:52 PM | Posted to Media | Venture Capital | Web 2.0 | TrackBack | Permalink

Back The Tough Guys

We find John Moulton's take on what makes good CEO material a refreshing change to what the b-schools are telling us. Citing evidence from the States, he says that the types that build large cap tech companies are "tough" and are not necessarily consensus building leader types. Therefore, he concludes "unreasonable and bright people" are the ones that investors should be backing. We've got the quote below.

It's worth remembering that in the US there are about a dozen CEOs running IT companies whose net worth exceed the market caps of Sage, the largest IT company in the UK, they don't get there by mistakes these guys are tough, we don't have them in the UK, we have a lot of guys who are good at running things efficiently but we really don't see as we poke around UK IT CEOs those who are competent at all aspects. We tend to have salesmen or accountants, we have very few from a technical back ground who are able to make the big creative leaps.

The good ones are not consensus people, think of the guys who made a bundle in the States such as Bill Gates and Larry Ellison, they're not noted for their warm friendly approach to decision taking, they are people of vigorous opinions, not always right but they force them through, their big drivers, so actually the evidence of the US says, the guys who are fairly unreasonable and pretty bright are the people we should be backing in this industry. There are very few excellent CEOs in the UK, very few. Only a couple of names come up regularly, they are very thin on the ground, we have a lot of competent people but we haven't got very many serious Zars.

Moulton is the managing partner at Alchemy Partners (a private equity firm) and he's written his thoughts on US versus Euro CEO in a newsletter from corporate finance boutique, ICON, which is specialized dealbrokering for tech firms.
Read - John Molton Insights On How to Spot A Failing CEO And Private Equity (ICON 66 April Issue)

Posted at 09:24 AM | Posted to entrepreneurship | TrackBack | Permalink

Glowria Buy 2nd German DVD Rental Rival And Other Fresh Euro Deals

Investments
Chippenham, UK VQ Communications has raised £250,000(webconferencing)
UK Foresight Venture Partners has invested £2.1m (as part of a pre-IPO round totalling £2.25m) into Auctioning4u(eBay drop off shop)
M&A
Paris, France - France's VC-backed Glowria buys Second German DVD Rental Startu (Online DVD Rentals)
Innsbruck, Austria - Assa Abbloy Has Acquired Schwab & Partner for an undisclosed amount (RFID For Ticketing)

Posted at 07:32 AM | Posted to News And Updates | TrackBack | Permalink

ClicMobile's MoSoSo Demo

Vpod.tv has a good video interview with Alex Kummerman, the founder of ClicMobile, based in Paris and Geneva.

Here's a startup that has managed to combine location based services and social networking and actually demonstrate it working in the short video interview. No slideware here.

It's a cellphone application that works on all phones, says Kummerman. It enables users to find folks in their contacts list that are in the vicinity, as well as friends of friends. Since it's using the cell network for the positioning part, it works in a wider radius than some of the other similar mobilephone apps we've seen in this category. Nice interface too.

Biz model is revenue sharing of text messages and ads. Kummerman's blog gives this type of app a new category. It is called MoSoSo (Mobile Social Software), doncha know.

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

May 16, 2006

Yoggie Raises $1.8M

Yoggie Security Systems, founded by Israel-based serial entrepreneur, Schlomo Touboul, who co-founded Finjan Software, has raised a $1.8M startup round. The firm said the financing round could be "extended".

The investor group is comprised of New York-based Early Bird Capital; a group of private investors from Silicon Valley, headed by Silicom Ventures; and a group of Israeli private investors.
The funds were raised to complete R&D and support marketing and sales efforts.

Yoggie is in stealth mode. It was founded in October 2005.

Read - Yoggie Security Systems completes a $ 1.8M round of investment.
Read Yoggie Profile (Tornado Insider)

Posted at 06:07 PM | Posted to News And Updates | Security | Venture Capital | TrackBack | Permalink

China's Maxthon Brings In Charles River

Maxthon has raised an undisclosed amount of venture backing in a deal led by new investors Charles River Ventures, along with early investors Lund/Kenner, a Danish seed investor (see link below for a profile) and WI Harper (via GigaOm).

The firm's founder said in his blog that there were several VCs interested in the Series A round, but it chose Charles River because of a common vision about the future of the market it targets. It's not mentioned in the post, but the new investor is also backing Avvenu, a software company that supplies a photo and file sharing plug-in to the Maxthon browser.

Read Charles River Ventures Invests in Maxthon (press release)
Read- Profile of Lund Kenner (a:c euro)

Posted at 05:39 PM | Posted to News And Updates | Online services | Venture Capital | TrackBack | Permalink

Musicbrigade: MTV For The Broadband Crowd

Swedish VC fund Provider Venture Partners has invested about €3.2M in Musicbrigade, a developer of a platform for downloading and distributing music, videos, and audio via the web and mobile devices, buying itself a 28 percent stake in the seven year old venture.

Musicbrigade started out as a music video distributor, an online version of MTV (at least the way it was in the eighties when it was mainly broadcasting music videos). It has 40 different music video channels.

But the Swedish company is now aiming to become a "onestop-shop for all digital music online", including audio and video.

Customers today are mainly in Northern Europe: broadband operators(Bredbandsbolaget, Telenor, Chello, Telewest/NTL, a o), portals (Microsoft Windows Media, On-line Spotlight, ao), mobile operators (3, Telenor/Vodafone, a o) as well as the hardware manufacturer Fujitsu Siemens Computers.

The plan is to use the capital to "substantially increase the presence on the European market".

Read - Provider invests in Musicbrigade (press release)

Posted at 03:17 PM | Posted to Media | Online services | Venture Capital | TrackBack | Permalink

Germany's Earlybird Can Say Exit In Four Languages

Germany-based Earlybird just announced its sixth exit in 9 months. It's had five successful IPOs on four different European stock exchanges and sold portfolio company Identify to BMC Software. Said Earlybird:

This continuous flow of exit events underlines not only the validation of Earlybird´s fund strategy but also the growing maturity of the European early stage venture capital industry and its ability to realize competitive Venture Capital returns compared to the US.

The VC firm will be marketing its next fund now. And from what we heard today at DowJones Limited Partner Summit in Zurich, it will find some willing listeners to its pitch.

Three different LPs said variations of "It's a good time to be investing in European venture capital." This is a new tune the LPs like Rho Fund Investor, Capvent, and Horsley Bridge are singing.

It's not that they are ready to invest blindly in European VC, but if a fund has shown it can "generate liquidity", particularly in the post-bubble period, and is bent on finding and building global tech ventures, they will find more open ears than they have in the past, it seems.

Posted at 09:16 AM | Posted to News And Updates | TrackBack | Permalink

French Digital TV Chip Startup Acquired

Silicon Laboratories has acquired French digital video broadcasting IP vendor Silembia for $20M. The French startup was founded in 2004 by a team that spun out of a Philips R&D lab in Rennes, France.
Read - Silicon Labs buys French digital TV startup (commsdesign)

Posted at 05:49 AM | Posted to News And Updates | Semiconductors | TrackBack | Permalink

May 15, 2006

Augmenting Reality

Total Immersion, a 6-year old French video graphics software startup has raised €4.5M, according Neteco. For this round Elaia Partners joins early investors iSource Gestion and Partech. The firm's software enables users to combine real time video with 3D graphics or objects. It's opening an office in San Francisco with plans to expands its business among film-makers and TV broadcasters. Men with virtual swords

Read - Specialiste de la realié (Neteco)

Posted at 02:29 PM | Posted to Venture Capital | TrackBack | Permalink

Chinese YouTube Raises $8.5M

Shanghai-based Toodou.com raised $8.5 million in a Series B financing round, co-led by Granite Global Ventures
and JAFCO Asia. IDG Technology Venture, the Series A round investor, also participated in the round.

Toodou.com is a podcasting and video sharing site that launched about a year ago, employs 20, and wants to hire more with the new capital. No description of the business model provided in the funding announcement.
We note that its video UI does not have the eyesore "play" button that YouTube's clips are stamped with.
Read -Toodou receives second round (press release)

Posted at 10:18 AM | Posted to Venture Capital | Web 2.0 | TrackBack | Permalink

VC To Leverage Indian Chip Design For Better Returns

A new VC fund, Silicon Capital, is going to try to cut the venture capital costs of funding chip startups by doing design in India, according to a brief in ElectronicsWire. The fund, about which we could not find any further public information, is basically institutionalizing what several European chip startups have already been doing to keep cash burn low.

We know the basic idea works, and that the fund has a famous founder, Rahul Sud, who co-founded Lattice Semiconductor and was until recently a top exec at Switzerland-based ST Micro. But we don't about the fund's size, its general partners, or who its limited partners are.

The Silicon Capital pitch:

The cost of designing a single chip of $35m to $50m has started to exceed the total funding available to a start-up through its first three funding stages,” said [fund founder Rahul] Sud.

The funding doesn’t cover the cost of designing the chip. By using an India-centric design platform we can drastically lower the amount of venture capital required to go from start-up to sales and profits

Asked by how much it would reduce the VC funding, Sud replied: “By 50 per cent. If it costs $30m to $40m to develop a chip in Europe, doing it in India would cost $15m to $20m.”

Read - European-Indian venture invests in chip start-ups

Posted at 07:40 AM | Posted to News And Updates | TrackBack | Permalink

Prague Startup And Really Simple Support For eMailrooms

From time to time we do an early stage company profile and this week, Sproutit, based in Prague is getting the treatment. We interviewed Charles Jolley, one of the three American founders of Sproutit (pictured here, Jolley far left), a software company that offers a web-based email support application, called Mailroom.

The business model is on-demand software, that is, users subscribe to the service on a month by month basis. Rates are based on volume rather than on seats/number of users.

Mailroom targets the small and medium sized business market. Sproutit’s marketing man says the software takes the “pain out of success”. The pitch is that when a company suddenly gets deluged with emails sent to their contact@, support@, info@ addresses, they can be handled faster with Mailroom.

It is different than standard email in a couple of ways. It exploits RSS (the same technology used to distribute the contents of blogs, online news, and search results), which makes it particularly suitable for teams and sharing the email response jobs. As it gives users the ability to "see" (in an RSS reader) and respond to email sent to other members of the team.

It uses “tags” instead of folders for categorizing and archiving (rather than directories, folders, and subdirectories). Being able to apply more than one tag raises the visibility of email correspondence.

A little bit of AI in the mix automates the reuse of past responses to email queries or requests, says the firm. The apps saves every reply sent and "learns" which replies are more commonly used with each email.

Customers include Chicago-based 37Signals, which uses it to handle their software support emails, Texas-based Blinksale, and JadedPixel, the Canadian company behind Shopify.

These customers, all startups themselves, are early adopters and validate to a degree, Sproutit’s product, but to grow the business as big as they want to, Jolley’s team will face the challenge of penetrating the small and medium sized business software market.

It's one of the toughest markets to penetrate, not as difficult as the carrier market, but for a startup, targeting a huge, highly fragmented market is, to say the least, a challenge.

But Jolley eyes what Intuit has done with its QuickBooks software as proof that it can be done.

The plan is to develop other business-oriented applications with the goal of publishing a suite of tools. As for financing, Jolley said the team aims to raise a typical Series A sized round to pay for marketing and sales and new product development. The founding team is moving back to the States in July, he said.

Posted at 07:03 AM | Posted to Business software | Web 2.0 | TrackBack | Permalink

May 14, 2006

More HabboHotel Clones in Europe

Sulake Labs' Habbo Hotel, the graphical online chat and virtual community site, has grown to over 40 million, and spawned a few copycats or variation on the theme, including Playdo in Sweden which reports 405,000; Dubit, based in the UK, reports 415,700 members and Taatu in Belgium with an unpublished number of registered members.

Playdo also develops gaming applications such as webcam-to-game integration. Sony's EyeToy has a similar feature.


Dubit offers members their own blogs, online games, and cash incentives to complete marketing surveys.

Update: Silicon Beat has a post on yet another one, this one's called Doppelganger
Read - With record company (Silicon Beat)
Read - HabboHotel Clone Taatu (a:c euro)

Posted at 05:42 PM | Posted to Media | Online services | Web 2.0 | TrackBack | Permalink

The VC World's Best-known Brand Still A Mystery

We tried Google Trends to see if we could find out which VCs had the best known brand. The tool lets users know if a brand-name or product is a widely used search term. We ran through several top European and US VC firm names to see which ones would show up.

Companies like Index Ventures, Partech, Sofinnova, do not have enough search volume to register in Google Trends. But we did get results for 3i and Apax Partners, and we threw in Sequoia Capital to get a comparison for a well known US brand.

3i seems to rank much higher than Apax Partners and Sequoia, but the results could be skewed because there was no way to separate out the results for people that were also using the search term "3i Infotech", which is an Indian software company.

Furthermore, both 3i and Apax do buyout investments and have publicly traded investment vehicles in their names, unlike Sequoia which is a pure VC investor and not publicly traded, so it's natural that they rank higher as they're of interest to a much wider search group.

We'd say that Google Trends results are not exactly definitive about who has the best and biggest VC brand. But it does make nice graphs.

It's probably more useful for consumer oriented startups that want to see how their brand is doing, rather than for the lower-public-profile world of VC investors. And now that so many have very distinctive names, think Pooxi, Technorati, HabboHotel, Skype, and mySQL, there little chance of getting skewed results in the trendlines.

Posted at 02:11 PM | Posted to News And Updates | TrackBack | Permalink

3i version 2.0

3i has published its definition of Web 2.0, as well as Trade 2.0, Consumer 2.0, and Economy 2.0 in its latest newsletter. It is a handy reference for entrepreneurs and corporate finance types wondering what kind of tech ventures that 3i might be interested in backing.

The UK venture capital and private equity firm has been undergoing some big changes in its management strategy too. The most significant, in the alarm:clock euro opinion, is the institution of a single carry for the venture capital team world-wide. Limited partners call this phenomena the "alignment of interests". And it should do a lot to get the partners in different countries and regions to work together with gusto.

There is also a single carry for each of the two private equity divisions too. An article in British newspaper, The Observer, sums it up quite nicely.

Read - isight (3i newsletter)
Read - Private equity behemoth flexes its muscle (The Observer)

Posted at 01:44 PM | Posted to Web 2.0 | TrackBack | Permalink

May 13, 2006

Hitflip's German Twist On Peerflix Taps Biz Angels

Sven Majunke's VC Facts newsletter reports this week that Hitflip Media Tradiing, which runs hitflip.de, a site that enables consumers to trade their DVD, CDs and Audio Books by post, has raised seed financing from business angels. The money will be used to add new categories, develop its white-label sales, and to add some social networking features. (TJ's Weblog has an interview with the founder where more details about the business can be found.)

The investors are Stefan Immes, CEO of publicly traded IT-Holding net AG and Lukasz Gadowski, founder of Spreadshirt.de, the quick growing online vendor of customized T-shirts. Three other private investors are named, two from a German marketing agency, Arend Lars Iven und Ron Hillmannand, along with Tobias Hundhausen, an accountant.

It looks like Hitflip has a dream-team set of angel investors that can add some value to the venture...maybe they will also spend some money on developing a logo that doesn't look as much like MySQL's.

Read - Interview with founder (TJ's Weblog)
Read - VC / PE - NEWSLETTER 17/2006 (vcfacts.de)

Posted at 08:22 AM | Posted to Venture Capital | TrackBack | Permalink

It's Party Poker For Women

A British newspaper provides an update on the addition of social network features and the news about plans to expand into the US for King.com, the small-stakes casual gaming company.

The Independent Online published a "Day in The Life" profile of co-founder Toby Rowlands. It requires reading about the entrepreneur's glamourous wife, food choices, and the wealth of the family he was born into, but if we stick with it there are a few nuggets about the business.

(Image right, shows some of the online aliases of the ladies who play for money and online fame.)

Launched at the start of 2004, it hosted 40 million games in January as 84,000 paying customers logged on. In peak hours, 35,000 people play at the same time. The stakes are tiny, averaging 35p, but people don't really play for money, Mr Rowland says.

It's the female Party Poker. Poker is all young guys between 18 and 35, what we do is women from 25-plus. They love the mental stimulation and the very small stakes."He adds: "There was nothing of this kind existing in Europe, and we thought the US sites weren't very good. It's a games site, but it's also a place where people talk to each other and make friends. They instant-message each other and have photographs of themselves and their dogs on the site."

The report says that King.com is going to expand its efforts in the US market. The business idea was originally copied from a US concept, but Rowland says they improved on it. They've been successful in the multi-lingual, multi-currency European market, and the next step is the US market. The firm is backed by Apax Partners, which owns a minority stake.

"European markets are the hardest ones to do because of the different languages and currencies, so we thought we'd do them first and then go for the US."

Read - Toby Rowland: The Acceptable Face of Capitalism Hits

Posted at 05:13 AM | Posted to Games (PC and other) | Web 2.0 | entrepreneurship | TrackBack | Permalink

May 12, 2006

The Handbag DAB Radio

Digital Audio Broadcasting (DAB), the emerging standard for digital radio is a big opportunity for European tech startups like fabless chipmaker Frontier Silicon, but the OEMs looking to sell to the consumer market are not necessarily focussing on the tech wizardry behind the new audio service.

Intempo Digital, a three year old UK based digital radio manufacturer, has launched a line of radios, some with a decidedly retro look and others that integrate an iPod docking station.

Intempo recently raised an undisclosed amount of financing from YFM, a UK private equity and venture firm.

Posted at 07:52 AM | Posted to | TrackBack | Permalink

Viscom IPO Raises €54M

The Viscom IPO in Germany raised €54M, which was exactly the amount the industrial inspection systems company was aiming for (including Greenshoe). Almost all of that new capital is to be used byViscom for expansion and some strategic acquisitions. Its market cap is at about €184M.

The stock went out at €20.4, slightly above its issue price of €18.50 and was trading at $18.64 as of market close yesterday.

Read - Deutsche Boerse IPO details

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

Famous Founder Looking For Next $M idea

Famous Founder Looking For Next Million Dollar Idea... That's how a handful of European serial entrepreneurs might word a classified ad, if they did things like that.

We've come across several that might be looking for their next fortune-making venture, having built at least two previous startups and walking away with a healthy return on their investments.

Fabrice Grinda (France) The 31 year old (far right, above) founded Zingy, a ringtone, wallpaper download service (similar to Jamba) in 2003. It was recently acquired for $80M. Prior to that he founded Aucland, an eBay clone, which was acquired by QXL Ricardo plc. Likes cloning. Now blogging at FabriceGrinda.com.

Marc Samwer (Germany) Co-founded Jamba, a cellphone ringtone and gaming portal, along with brothers, Oliver and Alexander, then sold it to Verisign for $273M. Prior to that founded Alando and sold it to eBay. Likes cloning.

Beat Heeb and Daniel Diez (Switzerland) The forty-something co- founders of Esmertec an embedded software developer for Javaphones - floated their firm on the SWX last year - leaving at the end of June. Prior to that the two co-founded Oberon Systems, a developer of programming and compilers technology. Smart techies.

Posted at 05:35 AM | Posted to entrepreneurship | TrackBack | Permalink

May 11, 2006

Windows And Exits

It is changed days in Europe. Now we're getting invitations to events inviting company owners to consider an exit by going public, making a secondary offering, or undertaking a trade sale/merger.

Translation: The Window Is Open: Plan Your Exit

Posted at 04:15 PM | Posted to entrepreneurship | TrackBack | Permalink

Plastic Logic Looking For New Capital?

Plastic Logic, a UK company that makes key parts for OLED displays, is going to be investing between $50M and $100M to build a new plastic electronics fabrication plant, according to one of its backers in an article in EETimes.

He did not say how the fab would be financed.

From the EETimes

Plastic Logic (Cambridge, England) has a roughly 12-inch diagonal display prototype working that combines an active plastic logic backplane with an electrophoretic display technology from E Ink (Cambridge, Mass.). The company announced a collaboration with E Ink in December 2004.

Hauser [Hermann Hauser of Amadeus, one of its VC backers] told his audience said that Plastic Logic is performing a detailed investigation of the costs of volume manufacturing of such active backplanes and that it seemed likely that the factory would cost between $50 million and $100 million and would be able to turn out millions of displays a year.

“We can build our first fab starting now for completion in about 18 months,” Hauser said. He said that after selection of a location, construction would begin in 2007 with a view to volume manufacturing in 2008.

Plastic Logic has raised more than $50M in venture capital to date from US, Chinese, European, and Japanese investors.
Read - Cambridge Startup Mulls Plastic Electronics

Posted at 06:44 AM | Posted to Displays | IPO | Venture Capital | TrackBack | Permalink

ad pepper Rolls Up Affiliate Marketer

ad pepper is paying up to €4.2M to acquire two-year old Webgains, a UK based affiliate marketing company. As we reported earlier, the European online marketing company is on an M&A roll. This is its latest deal.

The acquirer's deal rationale:

This acquisition dramatically enhances our existing product and service set up for our advertisers and website partners. In addition, it adds an attractive new line of business for ad pepper with innovative affiliate offerings not only in the UK but also in our other countries", explained Ulrich Schmidt, CEO of ad pepper media.

Read ad pepper media announces (press release)
Read - ad peppers Bargain Basement Rollup

Posted at 05:30 AM | Posted to Advertising | News And Updates | Online services | TrackBack | Permalink

Sports Content Hot For M&A

We're noticing a little spike in sporting news and content M&A in Europe. Yesterday London-based PA Sport announced acquiring US-oriented SportsTicker from ESPN. Venture-backed sports content and news startups might want to note that there is a bit of consolidation going on if they are looking to be acquired. Here are a few others.

Last month, France's Sporever, a publisher of online sports news and newspapers acquired sports stock photo supplier Panoramic for an undisclosed amount. Panoramic is profitable and had sales of €2M last year.

Maktoob Group, an Internet provider for the Arab market, bought 5 year old Middle Eastern sports site Sport4ever.com for an undisclosed amount.

Ireland's Setanta Sports Group, backed by Benchmark Capital Europe and the AIG Sports and Entertainment Fund, acquired North American Sports Network (NASN) last year. The target delivers American sport to European markets and complements Setanta's channels in the UK and Ireland that has broadcasts European soccer league games.

PA Sports said it bought SportsTicker for its US market share in the delivery of real-time sport content to the likes of Yahoo Sport, Microsoft, Sportsline.com and Fox Sports. PA Sport belongs to the PA Groups, which owns business, sport, the Empics stock photo service, as well as a couple of training and consulting businesses. It is privately owned by a network of regional publishers, and has annual sales of £69.7 million generating an operating profit of £5.9 million

Posted at 05:15 AM | Posted to Media | News And Updates | TrackBack | Permalink

May 10, 2006

Innovation Good But So is Cloning

Red Herring has some coverage of its technology investment conference in Paris this week. Cloning proven business models and exploiting other opportunities in Europe is the theme of one of its reports.

Britain's Lovefilm Not Only Copied A US Business Model, Its Ads Speak American Too

While some venture capitalists said there were enough innovative companies coming out of Europe, such as Skype and MySQL, European entrepreneurs can also bank on copying American products and services and bring them to the European market.

George Coelho, partner with London-based Benchmark Capital, gave the example of LoveFilm, a copy of the Netflix business model from the U.S., where members can rent DVDs by mail.

He said the venture market in Europe is still highly untapped because most VCs are chasing India and China’s growing economies rather than pursuing opportunities in Europe.

“Copying is OK and it’s hard for everyone to be everywhere at the same time, so we are concentrating on Europe,” Mr. Coelho said.

Read Technology Goes To Europe (Red Herring)

Posted at 08:00 PM | Posted to entrepreneurship | TrackBack | Permalink

Germany's United Internet Buys UK Webhosting Company

United Internet an Internet service provider is to acquire Fasthosts Internet, a web hosting company in the UK, for £65M in cash.

The Geman company, which started out back in 1981 providing teletext services, has several businesses under management, including broadband and email services, hosting and online marketing. Its market cap is €3.5B and its stock price has more than recovered the plunge it took post-bubble. We're looking into its plans for further acquisitions.

Posted at 05:20 PM | Posted to News And Updates | TrackBack | Permalink

Rushing For The Exit? E&Y Has Some Insights

The alarm:clock euro plowed through a 75 plus page report by Ernst&Young, published last week (you'll note we made a few posts on it to get our time's worth out of the effort). We made a list of the themes for the European market.

Sequoia's slick Info-graphic of its portfolio made the centerfold in the report.
1.VC went global. In case we hadn't noticed, there's a lot of talk about China & India. And if VCs haven't already started investing, or getting portfolio companies to do R&D and S&M (sales & marketing, that is) there, they are at least thinking about it.

2. Exits via IPO in Europe are back. In fact, there's more demand for growth stocks than there are companies selling them. (We still have the feeling that this is a well-kept secret, despite the numbers.)

3. Alternative Energy investing is now in the sights of Pan-European VCs. (They didn't suddenly start worrying about global warming, it is successful IPOs last year, such as Q-Cells, quickening interest.)

4. VCs are open to selling stakes to Private Equity firms as a way of achieving either an exit, or partial exit.

The last point is not just talk. We've noticed it in our coverage of recent transactions. It is not in the E&Y report but some examples of such deals include, Parrot Technologies (navigation s/w), Poliris (online real estate), Datamars (animal tracking RFID), and Carmel Pharma (toxic drug dispensers), sold their shares to late stage venture and private equity investors. The buyers have names like 3i, Invision, and Iris Capital.

Read -Ernst &Young Transition Report May 06

Posted at 02:07 PM | Posted to Venture Capital | entrepreneurship | TrackBack | Permalink

French Financial Software Firm Raises €5M

Business Intelligence software company, BI-SAM Technologies, has raised €5M from Galileo Partners and Alven Capital in an all French deal. The financing is to be used to fund international expansion. BI-SAM's software is used by banks and asset managers for portfolio management.

Read - BI-Sam Technologies Lève (Journal Du Net)

Posted at 01:29 PM | Posted to Software | Venture Capital | TrackBack | Permalink

Europe's Largest VC-Backed Exits in 2005

(Click to enlarge)
Europe's top VC-backed exits in terms of valuation for 2005.
Source: Transition VC Insights (E&Y)

Posted at 10:24 AM | Posted to News And Updates | TrackBack | Permalink

Following The Money In 2005

(Click to Enlarge)
Ernst & Young, in it latest Venture Capital Insights report, published a world map following the money in 2005. The $dollar figures are in billions.
Link - VC Insights May 06 (E&Y)

Posted at 10:13 AM | Posted to News And Updates | TrackBack | Permalink

May 09, 2006

Money Flows To Solar Buildings Company

Solarcentury, British vendor of energy and heating systems based on photovoltaics has raised £5.5m in a deal led by VantagePoint Venture Partners, along with existing investors Scottish and Southern Energy PLC. The new capital is to be used for product development.

The company has a whole line of heating and energy panels that are typically installed on rooftops. They are targeted at schools, building owners, community centers and the like.
Read - Solarcentury Picks Silicon Valley's VantagePoint (press release)
Read - Scottish & Southern invests further 3.125 mln stg in micro generation (Forbes)

Posted at 03:53 PM | Posted to Alternative Energy | News And Updates | TrackBack | Permalink

Know The Skype and P2P Share Of Network Traffic

QoSMOS, a French manufacturer of auditing and optimisation tools for IP networks, raised €3.2M from Sofinnova Partners in an internal second round. Founded in 2000, it raised €2M in its first round.

The startup's software, targeted at Telcos, can answer questions like

What is the quality experienced by users of your 3G services?
What is the impact of Peer to Peer on your network?
What is the Skype share of VoIP minutes on your network?
What range of applications is used by your corporate customers ?

QoSMOS is going to use the capital for European market development and product development, namely its flagship product QoSMOS ForMyNet, designed for broadband solutions. It's also doing R&D in advanced protocol recognition.

There is at least one other company that has a similar ability to answer such questions, Sandvine, but the technology is inside a much larger system, we believe. The fact that Qosmos has several OEMs incorporating its software suggests that it has found market demand.

Read - Qosmos announces (press release)

Posted at 09:24 AM | Posted to Broadband Networks | News And Updates | Venture Capital | TrackBack | Permalink

Spanish Chip Startup's Gotta Focus

What with Viscom going public in a nice-sized IPO this week, we're sensitive to machine vision startups, so a profile of Anafocus, a Spanish fabless chipmaker, on the IST newsite caught our eye today.

Anafocus is a Spanish startup that has developed a vision system-on-a-chip technology, called Eye-RIS. The first market it is targeting is security applications such as ultra high-speed tracking, in-door surveillance and guidance of unmanned vehicles. The idea is that security cameras equipped with the chips can be programmed to look out for anomalies or certain patterns.

Anafocus has yet to announce a design-in win and last raised VC in 2003 from Bullnet Capital, a tech oriented VC in Spain.

We've reporeted on similar chips over the years and are not sure what makes this different. We think it needs to focus a bit on marketing. Is its advantage cost, power consumption, quality of perofrmance? We are not sure and are not much more enlightened after visiting its website.

Anafocus could be in need of some smart money, or a big strategic partners to take it forward.

Read - Artificial vision technology proves

Posted at 09:01 AM | Posted to Semiconductors | Venture Capital | TrackBack | Permalink

May 08, 2006

VC Backs Sharing Music Tastes

Last.fm, a London-based consumer Internet startup, has raised a first round from Index Ventures and its early business angel investors. No disclosure on the amount, but it was a typical-sized Series A round, the firm’s Austrian co-founder Martin Stiksel told the a:c euro.

Stiksel said that the deal was initiated by Index Ventures, and that the founders had not been actively looking for funding. The VC’s track record with Internet investments is one reason it was taken on as a backer.

We asked Index why it didn’t bring in any co-investors on the deal. Neil Rimer answered (via his assistant) that the round “wasn't big enough for more than one VC investor.”

Judging from the Ikea decor and the hands on office-moving efforts of Last.fm's founders (picture right), this is one of those low-cash-burn ventures.

Indeed, it was founded in 2003 and only raised seed capital last June, when several private investors took stakes. All three had success in the first wave of the consumer Internet and are now on their second or third ventures, namely Joi Ito, who is currently an excutive at Technorati and Six Apart, runs a VC firm, and prior to that built several Japanese Internet ventures; Reid Hoffman, a former PayPal exec and currently CEO of LinkedIn, and Stefan Glaenzer, who co-founded Ricardo.de (auction site) and is CEO of 20six Weblogs.

Last.fm’s business idea is to enable music promotion and to provide music title recommendations for its users by publishing other users’ tastes and listening habits.

It generates sales via advertising, premium services, and selling recommended titles in partnership with Amazon and other etailers.

Its software automatically tracks what people listen to on their audio players then makes sure that the title information is loaded back up into their profiles.

This information is then shared and can be used to create a set of tracks to listen to (the firm calls it creating your own radio station and as its name suggests is meant to disrupt traditional radio broadcasting), or to make new music purchases.

It is not primarily a music file sharing site, so it avoids the issues with copyrights that have hindered the growth other online music ventures. But it’s got a few competitors, mainly Pandora, if the discussion on various web business-oriented blogs is anything to go by. (Among users of Alexa Last.fm's more popular, according to Alexaholic)

Last.fm will use the funding to broaden its product offering, start translating the site into languages other than English, and to expand its business development efforts with the music industry, Stiksel told the a:c euro.

Posted at 10:04 AM | Posted to Media | News And Updates | Online services | Venture Capital | Web 2.0 | TrackBack | Permalink

Agillic's Cellco Micro Marketing Software

Agillic, a Danish software company has raised about €5M from Amadeus in the UK and Vaeketsfonden, along with private investors, according to Unquote News.

The startup's software is targeted at mobile network operators and MVNO for use by their subscribers and customer relationship management teams. It's a category called Selfcare and Customer LifeCycle Management.

The idea is for the mobile operator to identify market segments, even micro markest segments, and automate customer self-service.

The company was founded in 1999 under the name Wavetech and switched to the Agillic name in 2005 in anticipation of global expansion. Lots of jobs on offer as the firm expects to double in size this year.

Read -Agillic Secures

Posted at 09:16 AM | Posted to News And Updates | Venture Capital | Wireless | TrackBack | Permalink

Float For Machine Vision Firm Viscom

This week, Germany’s Viscom, which sells optical and sensor systems used by OEMs like Siemens and Bosch in electronics inspection gear, is to float on the Frankfurt stock exchange.

It aims to raise about €54M. About 20 percent of the float will be going to the founders, and the rest to the company to fund expansion and strategic acquisitions.

At 21 percent a year over the past four years, the firm’s growth rate is above the semiconductor equipment industry’s average, say press report. The rest of the equipment supply sector is growing at about 7 percent a year.

In 2005 its turnover was €50.5M with an EBIT margin of 20 percent. The implied valuation of the firm, based on its bookbuilding price range is between, €174M and €208M,

Viscom's hardware spies defects such as those that occur in the manufacturing of electronics and in the mounting of semiconductor devices on circuit boards.

Read -
IPO von Viscom: Marktführer aus Niedersachsen

Posted at 07:48 AM | Posted to IPO | Semiconductors | TrackBack | Permalink

Cameraphone Zoom Contest

Over at the a:c, cameraphone zoom lens startup, Rhevision, gets coverage for its funding news. That deal makes three such ventures to attract VC in recent weeks. All three are racing to deliver zoom lens technology to cameraphone manufactures.

The other two to receive financing in the past few months are out of Europe, namely Varioptic and Eyesquad. Each has a similar size and form factor, but very different technical features and underlying technologies are being used.
(Image Source:Samsung)

The race is on.
Read - Do cellphones need zoom (alarm:clock)
Read - Varioptic funding
Read - Eyesquad funding

Posted at 05:59 AM | Posted to News And Updates | Wireless | TrackBack | Permalink

May 07, 2006

Cooling In A Microchip

Infineon, the German chipmaker, has spun off yet another R&D unit. This one leaves the currently restructuring mother-ship with chip technology that forms the heart of a tiny system that can cool, heat, or generate power.

Micropelt spun off from Infineon earlier this year and received startup capital from German investors, including a venture firm, SHS, and several banks in a deal that was announced in March. Infineon and the management team hold a minority stake.

Micropelt GmbH, develops and distributes components (Peltier-based) for cooling and heating, as well as thermo generators, which are manufactured using the same process as used to fabricate computer chips. The startup says that the advantages are small size, high cooling power densities, and a short response time. It has yet to announce a contract win but does have its data sheets, test results, and a design tool available for potential customers.

Applications include cooling fiber optic lasers, power generation in watches, and chip cooling.

Read - SHS takes a stake in the Infineon spin-off and in a development unit of the Agfa group

Posted at 08:26 PM | Posted to Semiconductors | Venture Capital | TrackBack | Permalink

May 05, 2006

Jupitermedia Snaps German Image Vendor

Following its rollup strategy in the royalty free and rights-managed image space, JupiterMedia's Jupiterimages division acquired all of the shares of Germany's IFABilderteam GmbH (www.ifa-bilderteam.com). No disclosure on the terms of the agreement.

Read -Jupiterimages Division Announces Acquisition of IFA Bilderteam of Munich

Posted at 10:21 PM | Posted to News And Updates | Online services | TrackBack | Permalink

Meetic Buys Brazilian Dating Site

The French online dating company, Meetic, has made another acquisition. This time in Brazil, paying €21.6M in cash for ParParfeito, it said in a statement. Since going public it has purchased LeXa.nl (Dutch) and efriendsnet (China).

MEETIC announces that it has signed an agreement with a view to the acquisition of ParPerfeito, the online dating leader in Brazil. Founded in 2002 and based in Rio de Janeiro (Brazil), ParPerfeito runs the www.parperfeito.com.br site, and has rapidly become Brazil’s leading online dating service with close to 8 million registered profiles since its creation. ParPerfeito’s estimated revenues in 2005 totalled R$ 10.4 million, or approximately 4 million euros. ParPerfeito’s estimated EBITDA in 2005 totalled R$ 6,0 million, or approximately 2,3 million euros. This acquisition, which should be finalised over the coming days, concerns 100% of the Company’s capital and voting rights for a global price - totally paid for in cash - of R$ 56.6 million, or 21.6 million euros, excluding further payments based on the Company’s results over the next three financial years.

Read - ACQUISITION OF PARPERFEITO (meetic PR)

Posted at 05:30 PM | Posted to News And Updates | Online services | TrackBack | Permalink

German eMail Marketer To Float

eCircle, a German email marketing firm, is planning an IPO this year to raise capital for expansion and "selective" acquisitions on the back of achieving a 63 percent growth in sales last year to reach €12.2M and a profit of €2M before tax deductions. Despite its small size, the firm says it will list on the EU-regulated Prime Standard market in Frankfurt. There was no disclosure on the size of the float, nor mandated investment banks.
UPDATE: eCircle is venture-backed. Its investors over the years include Wellington Partners and T-Ventures (the Deutsche Telekom venture arm) and BHF-Bank, as well as private investors.

The company provides direct marketing services such as newsletter send-outs and email (ASP-model), SMS campaigns, permission address lists booking and claims to deliver 300 million emails per quarter for the likes of Standard Life, Vodafone, Thomas Cook, T-Mobile, and MTV.

This startup's business activities, size, and growth rate is very similar to France's Emailvison, which had a successful float in February on the lightly regulated Alternext exchange (part of Euronext). Subsequent to its oversubscribed IPO, about 10 percent of its equity was acquired by Fidelity International.
Read - eCircle AG: Prime Standard angestrebt

Posted at 02:38 PM | Posted to Advertising | IPO | News And Updates | TrackBack | Permalink

Personal Video Sunglasses

Mirage Innovations, which last September raised $7.5 million in a Series A round of financing from Gemini, Landa Ventures, and Benchmark Capital, is demoing a nano-prism wearable display.

It says the lightweight display is for use with portable media players, game consoles, cellular phones, and PDAs.

The headgear, which looks to still be in prototype phase, has been a long time in coming. The company was founded in 1998.

Read Israeli Startup Creates Wearable Display (infoweek)
Link Mirage Innovations

Posted at 08:43 AM | Posted to Displays | TrackBack | Permalink

May 04, 2006

Experian Buys Backgroundchecking.com

Experian, a credit reporting company, is continuing its acquisition spree with the purchase of Backgroundchecking.com, an online service used for job candidate background checking owned by RWC. Since last may it has acquired lowermybills.com, pricegrabber.com, and software company ClarityBlue in the UK.

Experian belongs to UK-based GUS, a company that also own retail chains. Experian is expected to be spun out from GUS this year.

Posted at 02:10 PM | Posted to News And Updates | TrackBack | Permalink

May 03, 2006

Connecting The Dots On Marco Börries Connected Life

We were wondering whatever happened to Marco Börries, the young German entrepreneur that sold his office software company, StarDivision to Sun Microsystems back in 1999.

He was a bit of a legend in our part of Europe for his vision of creating a complete office suite meant to compete head on with Microsoft, and for using what was in 1999 a novel business model for productivity software applications, it was free for personal use. (The reason we were thinking along this line is an interview we did with the founders of Sproutit in Prague, whose business software and vision reminded us a little of Boerries'.)

Turns out, he's at Yahoo, heading its Connected Life division (mobile, TV and video business) as we found out from an archived post on MocoNews.

We knew he had raised venture capital and formed Verdisoft in 2001, and had operations in Hamburg and Silicon Valley, but the a:c euro missed Yahoo acquiring it back in early 2005.

MocoNews excerpt:

At 16, he dropped out of high school in Germany to establish StarOffice, the Microsoft office suite alternative; he sold that company to Sun Microsystems in 1999, joining Sun where he continued open desktop efforts Solaris and evangelized open source through GNOME.

In 2001, he founded VerdiSoft to enable his vision of the connected life between PC, TV and cell phone. Yahoo bought VerdiSoft last February, bringing Boerries in as a top executive; the results started to unfold publicly at CES. Boerries’ responsibilities: mobile, digital home, PC client, broadband relationships — “pretty much everything beyond the browser.”

There are not too many European entrepreneurs that have sold not one but two startups to Silicon Valley giants, so we're asking how long will it be until an enterprising VC convinces him to leave when his contract is up and start another venture, maybe one that will make it to IPO this time.

Read - CES 2006: Interview: Marco Boerries, SVP-Connected Life, Yahoo

Posted at 09:55 PM | Posted to Interactive TV | Where are they now | Wireless | entrepreneurship | TrackBack | Permalink

Testing The Real-Timing

German startup, Symtavision, whose software tests the performance of real-time systems found in mobilephones and automobiles, has raised a seed round €0.5M from the HighTech Gruenderfonds, a fund that was set up by the State to back the very early stage for university spinoffs.

Symtavision, which was founded in May 2005, is a spin-off from the Technical University of Braunschweig, has had quite a bit of coverage in the German press because its software is being touted as being able to prevent expensive auto industry recalls due to electronics defects, and as enabling getting electronic products timely market entries.

If Symptavision's founders get it right, they just might find BMW, Volkswagen, and Daimler Chrysler knocking on the door. Apparently, the firm has already signed up Samsung's mobilephone unit.

Read - Braunschweiger Symtavision GmbH erhält Beteiligungsfinanzierung vom High-Tech Gründerfonds

Posted at 12:48 PM | Posted to Software | Venture Capital | TrackBack | Permalink

Dohop = Travel Search +660 Airlines - Focus on Price + Reykjavik Cool

We're going back to Iceland again today for a look at Dohop.com, a new travel search engine startup founded by Frosti Sigurjonsson in 2004. We picked it not because the founder's name is memorably apt, coming as he does from Iceland, but because it's a bit different from the competition. It is a fast search engine and checks hundreds of airlines (660 says the founder) and supports multiple currencies, which is important when targetting the European and other international markets.

We talked to Sigurjonsson about the competition and how dohop.com generates sales.

Even with its use of new web development technologies, Dohop has plenty of competition from other young rivals, including Kayak, Sidestep, Mobissimo, Skyscanner and allcheckin. How to compete with all that?

These are all price comparision sites, several with a strong focus on the USA travel. dohop has much in common with the competition, it finds flights, checks the price and links the user to the airline or OTA to do the booking, but what sets it apart is its ambition to be a comprehensive Flight Planner -- for planning connected itineraries.

We have developed a unique routing engine that uses the timetables of more than 660 low-cost and legacy airines to find the best flights and connections for any given route worldwide, in only three seconds.

The price comparision engines are by contrast limited to search only the airlines that publish their fares in GDS systems [third party provider] and will only show connections with legacy airlines. They must rely on third parties like the GDS or ITA software to do the routing and pricing. Skyscanner.net has the benefit of including low-cost airlines but it does not offer a routing engine.

Dohop is barely registering on the Alexa radar, compared to Kayak.com and eBookers. Why is that?

The reason for lower traffic counts is simply that dohop.com has not yet done any marketing whereas both Kayak and ebookers have had the budgets to do quite a bit of marketing and PR. Almost nobody knows about dohop yet.

So far the traffic we do get is by luck. A couple of days ago the Times Online published its list of the 100 best travel sites and put dohop.com as #2 on their list of Flight Essentials. This is now driving unusual amounts of traffic our way.

The target market is travellers that want to manage their own trips. What is the offer?

We take the pain out of planning. By searching ALL airlines rather than just the legacy ones, dohop is often able to find more efficient flight routes and because it includes low-cost carriers the price of the trip can sometimes be very cheap.

Flight planning usually involves a lot of information. dohop employs Web 2.0 technologies to make the planning more intuitive for the user. Results can for example be sorted, filtered and drilled into with instant effect.

Another difference is that dohop does does not display live prices for all results, whereas the price comparision engines do display prices upfront. Why is it set up like that?

When we decided to include all 660 airlines worldwide we had to accept that it would not be possible to display the live price for every possible flight combination and travel dates all the time. Fares change too frequently, often several times a day. To make matters even worse, prices for the same flight number can differ by user's country of residence.

Dohop suggests that once a user has refined the results to a single itinerary, he or she can then check the price with more than half of the airlines in the system, and more are being added each week. A price lookup only takes a few seconds. Each price is then stored in case it can be shared with another user asking for the same flight later.

But how will dohop make money? One thing is that it offers "sponsored links" in the search results, e.g. searching for a flight from basel to Paris, Air France's sponsored link displays its offer at the top of the list. Anything else?

We offer custom flight planners for placement on the websites of low cost airlines. Results are of course optimised to show only results that include at least one flight from that airline. You can see one example here: http://search.icelandexpress.com This airline flies to 10 destinations but the custom flight planner will find convenient onward flights to at least 100 more. A great sales tool for them and a source of traffic for us.

We are now talking to major portals about powering white label flight-planners for their travel sections.

As for financing, it has some angel and founder funding, but the founder will be looking to raise some venture capital. "We are now starting to talk to VCs about funding dohop's global rollout," Sigurjonsson said.

Posted at 09:58 AM | Posted to Online services | Web 2.0 | TrackBack | Permalink

May 02, 2006

Hungarian Social Networking Site Acquired By Telco

Magyar Telekom's T-Online subsidiary has acquired iWiW, a Hungarian online social network, for €4M. Founded in 2002, the sites membership is by invitation-only. In October 2005, the site was revamped under the name of iWiW (abbreviation for International Who is Who) and became available in 16 languages, featuring several new services. Currently, it has more than half a million registered members.

According to Wikipedia, iWiiWs creator received a state honour last October for developing the site.

Read - T-Online gains control of iWiW

Posted at 03:40 PM | Posted to Web 2.0 | TrackBack | Permalink

Spain's Polymita Hoping For Enterprise Web 2.0

VCs haven't been investing in web development software for some time, so it is interesting to see that three year old Polymita Technologies in Spain has raised €2.5M from Spanish venture firms Molins Capital Inversión and Adara Venture Partners.

Polymita sells software and platforms for business process management, portal development, and content management to the enterprise market, promising customers a high level of return on investment. It is active mainly in the Spanish market. The new capital will be used to grow internationally and for some product development, it said.

Maybe the investors are counting on the enterprise market to start renewing web sites in a big way. Since the firm sells fairly comprehensive solutions, we take it, including portal software that supports using AJAX technologies for web development, it might be positioned well if and when that growth starts to happen. It sells directly and through reseller partners.

Read - Polymita Funding Announcement
Read - Polymita AJAX Support Announcement (in Spanish)

Posted at 11:57 AM | Posted to Software | Web 2.0 | TrackBack | Permalink

VC backed BitBoys Acquired by ATI

Graphics chip firm BitBoys has been acquired by Canada's ATI Technologies Inc. for up to EUR 35.2 million (about US$44 million). Based in Finland, Bitboys, which recently completed a restructuring and is now focused on graphics processors for mobile devices, had raised several small rounds of venture capital over the years, most recently a €4M injection from Nokia Growth Partners in February. Other investors include Cipio Partners, along with a handful of Nordic investors.

We think it must have been a sweet deal for the latecoming investors, but we're not too sure about the early ones.

Read - ATI Acquires Bitboys

Posted at 11:40 AM | Posted to Semiconductors | Venture Capital | TrackBack | Permalink

Partech: European VC Interview Series

What's the expert view on M&A prospects for venture-backed optical components developers? Where are VCs looking to invest? These are the some of the questioned answered in the first of a series of interviews with European venture capital firms, published by the alarm:clock euro.

Today, Partech, one of the older VC firms in Europe, is getting the treatment. Philippe Crochet, pictured below, who is based in Paris, agreed to do an interview with the a:c euro via email.

He's the Partech investment manager responsible for chips and communications investments (working with Partech partners, Jean Marc Patouillaud and Helmut Schon), which just happen to be two of the hottest sectors in Europe in attracting VC money these days.

Unlike a lot of the larger VCs here, Partech doesn’t invest in life science in addition to tech, it only invests in IT, including Software & Internet, Healthcare IT, and Communications & Components.The firm invests from offices in Paris, San Francisco, and Israel.

We note that Crochet included the URL for portfolio companies in his written reply to our questions. We like that kind of proactive behaviour and have left them in.

How was 2005 for Partech? Just the European market, please.

New investments in 2005 included leading an €24.5M round of investment in Dibcom, a French company working in the area of chipsets for the reception of Digital Television in portable and mobile applications.

DiBcom’s technology has been used by a number of tier 1 customers in the automotive, notebook PC, cell phone, and portable media player (PMP) market segments.

We also took part in the €16M financing round for B3G , a VoIP operator founded in France in 2001. Operating both in France and in Europe, B3G Telecom addresses key telecom operators and telecommunication professionals with a “wholesale” service offer. B3G also addresses the enterprise market with an exclusive indirect channel distribution strategy.

Lastly, we refinanced Realeyes3D, co-leading the round with Atlas. Realeyes3D is a leading provider of advanced image processing applications for camera phones. For example, its technology enables cameraphone to act as mobile scanners. I recommend everyone to try the early beta version on Click to Scan. It’s pretty amazing.

On the exit side, we sold three companies from our European portfolio to US buyers, namely DCT (to Veritas), Meiosys (to IBM) and Dedigate (to Terremark Worldwide).

Mobile TV is an area attracting a bit of attention now, how is Dibcom doing?

We have been pleasantly surprised with the adoption and the momentum of DVB-H and with the launch of the first DVB-H based mobile TV offering in Italy this year. Many other countries will follow. This is a very exciting space.

We noticed the Passave acquisition last month. Are optical networking companies in line for some M&A activity?

During the bubble there it was said that over US$1B was invested in optical programs. This sector totally crashed for years. The survivors that are emerging are starting to see reasonable growth on their optical core businesses.

We are again seeing optical companies coming to the VC market that have revenue growth and can have some semblance of profitability in sight. In addition, the FTTX market is growing and as carriers enter the IPTV market, copper is just not enough bandwidth into a home which is driving demand.

The combination of more revenue, growth in demand, and startups finally getting closer to cash flow breakeven, and cash flow positive, will allow for a more healthier M&A environment.

Not an optical company per se, but we have in our portfolio the only startup remaining in the PON, namely Teknovus, with more than 2 million lines shipped and over 20 carrier wins.

What effect will the Lucent/Alcatel merger have on potential trade sale exits?

Well, it is difficult to tell on the long term although I doubt the combined entity would acquire more companies than the two separate companies. In the short term, the two companies will be certainly too busy with the merger to look for new acquisitions.

There have been few exits for VC-backed chip companies in recent months. Why is that?

First of all, you have to take in account the relative percentage of chip companies amongst VC backed companies. Secondly, there has been a number of nice and significant exits recently.
PMC Sierra has acquired Passave for $300M, Texas Instruments has recently completed its acquisition of Chipcon based in Norway for $200M, Broadcom paid nearly $80M for Sandburst.

Going back a bit further, one should of course mention as well other European successes such as CSR [Cambridge Silicon Radio] IPO or the Alphamosaic (by Broadcom) acquisition.

How is dealflow? And related to that, are you trying any new or innovative ways to attract alpha geeks and/or serial entreprenurs?

I am not sure there are very [many] innovative ways to attract serial entrepreneurs. Relationships take years to be built and we try to manage the best we can an international network created during the 25 years of Partech existence.

As an example, Christophe Bach and Patrice Giami, ISDNet founders, in which Partech was an investor, came back to us when they decided to finance B3G and we very happily decided to join their new venture.

But at the same time, we also try to stay very close to the research centers and keep our eyes very wide open for the new talents to emerge. At the end of the day, I am convinced that only long term professionalism can guarantee a healthy deal flow.

Compare the attitude of entrepreneurs today to two years ago, six years ago, and ten years ago?

This is a very open question. Let’s say that entrepreneurship is definitively stronger in Europe today, with a new generation of young serial entrepreneurs that I find very impressive. I am not sure this is related to the money they may have made during the bubble, but rather a question of mindset and a strong experience and realism from the post bubble years.

Where are you looking to invest now?

Such spaces still include wireless, including various technologies such as 802.11n or HSDPA, but also the wireline reponse, namely broadband access and associated services such as VoIP, IPTV and many others, and eventually convergence. We are also of course still looking at enabling components, anything smaller cheaper, faster and with a lower power consumption.

Posted at 07:17 AM | Posted to Venture Capital | TrackBack | Permalink

New Embedded Memory Tech Brings In US and German VCs

Dutch fabless semiconductor firm, Cavendish Kinetics, tapped new investors Tallwood Venture Capital from Palo Alto, CA and Munich-based Wellington Partners for its second round raising $15.5M.

Someone said to the a:c recently that there isn't much trans-border dealmaking in Europe, but think about this one. Cavendish, is a 12 year old Dutch firm, commercializing technology developed at the UK's University of Cambridge, and its investors hail from the US, Germany, UK, and Canada. The venture has 10 investors altogether.

The new funds will be used to continue the development of its memory technology which is an alternative to FLASH and EPROMS. Via IP licenses, it sells to fabless semiconductor companies, independant design manufacturer, and CMOS foundries.

Cavendish has three product lines: all CMOS (which means it's standard process for the manufacturing), low power memory chips that can operate in extreme temperature and radiation ambients, and able to operate with standard voltages, which, the firm says, is one thing differentiating it from existing FLASH and EEPROM memories.

Read - Cavendish Kinetics Raises $15.5 Million in Second-Round Funding (press release)

Posted at 06:43 AM | Posted to Semiconductors | Venture Capital | TrackBack | Permalink

May 01, 2006

High Volumes Attract Investors to Ireland's Firecomms

Firecomms, a spinoff from the Tyndall Institute in Ireland, has raised €9.6M in a deal that brings in two new investors, Irish VC, ACT Venture Capital, and laser manufacturer, ALPS. Its early investor, Atlantic Bridge, also came back for this round.

Firecomms makes two kinds of optical components, both targeted at high-volume markets (consumer electroncis and automotive data comms), which it sells to OEMs. These include light emitting diodes and laser chips, known as a VCSELs.

The firm says that its LEDs are much faster than those on the market today, so they can be used for data communications and can replace copper cables in home and car networks, where glass fiber is too expensive to terminate, and copper is heavy and sensitive to electromagnetic interference. Unlike the alternatives, this architecture (based on plastic fiber optics) has a lower installed cost, is not sensitive to electromagnetic interference, is easy to terminate, and is lightweight.

Its VCSELs are targeted at home networks for transporting TV signals up to 50m from a set-top box to a flat screen, as well as for transporting data the short distance from portable PC and mobilephone chips to the LCD screen. Its solution is more robust, lower cost, and able to handle the high speeds now being demanded in these two market segments.

There have been plenty of investments in European VCSEL and LED startups but many struggled and failed to live up to their early potential because they didn't, or could not, (due to the limitations of there photonic components) target high-volume markets (to be fair many were targetting the telecomms sector which completely evaporated when the bubble burst) This one has clearly avoided these traps. With its new strategic investor and a nice amount of capital, we think that Firecomms has promise.

Read -Firecomms Announces a Funding Round of euro 9.6 Million (press release)

Posted at 06:59 AM | Posted to Semiconductors | Venture Capital | TrackBack | Permalink