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October 31, 2007
Danish Search Merger and Other Fresh Euro Tech M&A -
Today we have a roundup of some the past week's M&A deals relevant to a:c euro readers...
Danish Search Merger
SurfRay, a Copenhagen based enterprise search software company has acquired Mondosoft, an 11 year old dual-headquartered company in DK and US. Last year Surfray acquired Speed of Mind, another Nordic startup. The team from VC-backed Mondosoft will remain intact and join SurfRay, the firms said in a press release.
View Mondosoft
Sage
Accountancy software group Sage, which now has a mkt cap of more than £3B, has acquired UK payroll specialized software company KCS Global for £20M. The management, led by managing director Alan Snell, and VC firm Northern Venture Managers benefit from the deal.
Read Announcement
Autonomy Acquires
Autonomy, currently the second largest software firm in the UK by mkt cap after Sage, said it is acquiring Belfast-based Meridio for about $25M. The target, which delivers software to military organizations was VC-backed by ACT Venture Capital (majority) and Polaris (US-based).
Read Computerwire story
Polymer Vision Rolls Up Manufacturer
Polymer Vision, a rollable display manufacturer that is a spinout of Philips, said yesterday it acquired its UK-based manufacturing sub-contractor, Innos, for an undisclosed amount. The press release also said that Telecom Italia Mobile is its first big customer as it the telco plans a wireless ebook reader and service.
Read EETimes article on the deal has details of the fab and the flagship product
Read our article on PV's latest financing round
Posted at 05:02 AM | Posted to News And Updates | TrackBack | Permalink
October 30, 2007
Fatfoogoo Signs Series A Round
Fatfoogoo, the Austrian startup that runs a marketplace to auction virtual items for getting ahead in popular role-playing games, has raised an undisclosed amount in a Series A round led by Austria’s Gamma Capital Partners (gcp), along with existing seed investors marchsixteen LLC (Toto Wolff), Azzurro Investment (Christian Lutz) and Michael Krammer (new CEO at Orange Austria).
So far the site is offering items from the likes of World of Warcraft, Second Life, and EVE Online, eight games in all.
The capital will give it a chance to go for a piece of the 'booming market for trading virtual assets and services', said Martin Herdina in an email to the alarm:clock euro.
The deal is the first investment out of GCP’s Gamma III fund. Corrected text follows. GCP manages a total of €70m in three funds.
Posted at 10:49 AM | Posted to News And Updates | TrackBack | Permalink
Headweb : Legal Video Download To DVD Out of Sweden
We're seeing a few more examples of video downloading as a legal business proposition these days. For example, TIOTI, which supports downloading and streaming of TV and video recordings. It recently raised capital from early stage UK venture firm Pond Ventures, according to Techcrunch UK.
And News from Blognation Japan is that network operator KDDI is trying to make a business out legal movie downloads using watermarking as a way to protect copyright.
Sweden, the same country that brought us PirateBay and Kazaa, has another contender to add to the list, Headweb for legal P2P downloads to DVD
Development began in August last year and the team, along with two business angels, has invested about €1M in the venture so far. It is slated to launch this week. Read on for an edited Q&A we did with co-founder Peter Alvarsson by email.
Founded by 26 year old Peter Alvarsson, along with Ingemar Bygdestam and Pelka Hansson who all come out of the DVD and content indusry, Headweb got underway in early 2006.
Stockholm Style - Peter Alvarsson co-founder and COO of Headweb
Two things make Headweb stand out besides its use of Bittorrent.
1) it has a way to increase user numbers quickly. It motivates users to bring in friends by giving them credits to acquire free videos. The same system encourages users to make their PCs available to the network
2) It is legal and has a copy-protection system based on watermarking that could be more consumer-friendly than the alternatives in use today. The startup owns its watermarking tech.
What has been the reaction of content owners, studios and the like to your proposition?
Some movie studios have come further than others regarding legal movie downloads, both mentally and practically. Some companies embrace our technology with open arms and believe this really is what the market needs. Other companies are more conservative and protective but they also know that they need to change and open up to get any revenues at all. The music industry is starting to go DRM free now, the same thing will happen to the movie industry too, it's just a matter of time.
The team has done a lot in a relatively short time.
Yes, it is a lot in a short time, but more is yet to come. Your conclusions are very exact: it is a copyright protection system designed for people.
And with your own watermark technology, you have the basis for another kind of business in case this one flops.
True. We have already received propositions about licensing the technology for other ventures and services.
Do we have it right, you use a bittorrent platform for distribution of videos based on Xvid, an open source alternative to Divx?
We will soon also offer the movies in Xvid (MPEG4 format) so the users can choose which format they want depending on personal taste and bandwidth.
However, initially we will distribute an "electronic DVD", meaning we distribute what's on a physical DVD disc. That's why you can burn the movie and watch it in any regular DVD player in the world. The electronic DVD is based on MPEG2 compression.
The electronic DVD can be up to 4,5Gb in size while the Xvid version will be around 1 Gb.
Later, more formats will be introduced.
What is the client like?
Our client contains download functionality, playback functionality (Media Player) and burn functionality. The user shouldnt need any other software to use the service.
Tell us about pricing and how customers earn credit towards the purchase of titles.
There are several ways of earning credits. One is by being an uploader. Also, by being active socially in the community you can earn credits in different ways. Inviting friends is one way. Writing reviews is another.
… And there are no limits on how many credits you can earn.
We wont have one fixed price though, different movies will have different prices depending on age etc but be in the range of 6 to 14 Euro. There are different payment methods like credit card, pre-pay (load your Headweb account with money, good for parents wanting to give to their kids).
We are looking at implementing more payment methods too.
You have developers in far flung places, any tips for our readers on how you managed the team, did you use any collaboration tools or project management tools that helped?
Yes, this has been a fun part of the project, we work a lot with chat applications like Skype. Google Docs sometimes for sharing documents. And a developer forum where we discuss specific parts of the project.
One last thing, I can see parents telling their kids to use Headweb, but what about others. What do you offer that Pirate Bay or its alternatives, don't? Let's assume that a PB user doesn't care if the downloading is legal or not, what other reason does he have to switch to Headway?
There are many things with illegal alternatives that are problematic: You don't know what quality the files are in (maybe it is recorded from a movie screen), files might be infected with viruses, you dont know if the download contains what it says it should (spam files). And it could be problematic for users to know what kind of player and decoder they should use for playback.
There are also issues with subtitles that comes with illegal downloads, they are often translated by home users which means the quality can be so-so sometimes.
Headweb will always guarantee a good quality movie including surround sound and the real subtitles. Downloads are free from viruses and spam and it will be very easy to play it back on your computer and burn it since everything is included in one package.
We know that many people are not very technical and will want this "works from the box" experience (compare with the iPod and iTunes) and we believe that the market is much bigger than those using illegal services today.
So in a way the pirates are our customers but many "pirates" will continue to use illegal services so we're actually not in this game to convert pirates to legal customers but instead focusing on making the service available to "everyone".
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Thanks for the interview and for reading the alarm:clock euro.
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Other sources on Headweb
Read The Local : Feature on Headweb
Read Legal Bittorent DVDs
Read Latest on Bittorrent (the company)
Posted at 09:13 AM | Posted to Early stage | TrackBack | Permalink
October 29, 2007
Semiconductor Design Cycle Wizard
German startup Process Relations has raised €700K from the HighTech Gründerfonds, and co-investors, to commercialize a software application that enables semiconductor and MEMS device developers to track and document and integrate data along the entire design cycle: from idea to experimental to test stage, including the final integration into the fab process system.
It's targeting a 'pain point', we'd say. And it gives the following as an example. When an engineer leaves a development project, his expertise and memory of who did what, when, why, and how goes with him. And when a new engineer joins the team he/she will be overwhelmed with too much unstructured data.
Based on this reporter's experience in the electronics industry, an application like this has potential beyond chipcos. The trick is making it palatable for engineers to take the time to use it.
View Process Relations
Posted at 06:54 AM | Posted to News And Updates | Semiconductor Manufacturing Equipment | Semiconductors | TrackBack | Permalink
Critical Links Raises $5.7M - Edge Hardware
Critical Links said Friday it raised a $5.7M Series A round from InovCapital, Change Partners and ASK/ISQ Capital. The Portugal-based company develops networking equipment for a range of small to medium sized businesses. The boxes offer support for routing, connectivity, Wifi support, VOIP and telephony management, automatic backup, and storage. It spun off from a software engineering services company called Critical Software in early 2006. The parent company, which has offices in Portugal and in key markets abroad, has been supporting its early stage development.
The question as always with this kind of hardware is: can it be installed and configured and maintained at a cost that is in proportion to the price paid for the gear. We are hoping to update this post with answers to this question and several others we posed to the founders by email.
View Critical Links
Posted at 06:41 AM | Posted to Broadband Networks | News And Updates | TrackBack | Permalink
Looneo's Social Shopping Play Gets €2M
Looneo has raised €2M for its consumer electronics product review aggregator [via].
Blognation France has an overview of the online service.
Read - Social Shopping Looneo
View Looneo
Posted at 06:37 AM | Posted to News And Updates | TrackBack | Permalink
Cookies For Men Only
Cookies -- the kind you eat, not delete from your browser -- are the latest Swiss product to use a "for men only" promotional campaign.
Wernli, the company that makes this dark-chocolate coated cookie called Gaura is under the management of Michael P Sarp. HIs last gig was with the lux-watch company IWC where the formula worked well.
One of its better known slogans:
She can have the car, the house, and the dog. But not my IWC!
Sarp shows he knows a thing or two about managing his own image too. He is also a 'celebrity' model, along with his wife, for the current Pink Ribbon campaign here to get women to do early breast cancer diagnosis.
Get your manly cookies here.
Posted at 06:36 AM | Posted to Being European | TrackBack | Permalink
October 25, 2007
From Austria : Semiconductor 2.0
The title is the post is the trademarked tag-line of Austrian startup, NanoIdent. Unlike a lot of 2.0 startups this reporter has looked at over the past two years, this one feel like it is the beginning of something new.
The four year old Austrian company is specialized in developing and manufacturing printed semiconductors using organic and inorganic materials. It's already generating sales of single digit millions, mainly in customer-financed product development projects – not trials -- and it has visibility on ticking that figure up to a two digit million one next year.
The Linz-based startup has its own fab. It is not an indulgence, it is a necessity, according to Klaus G Schroeter, co-founder and CEO. "Our blue-chip customers won't abandon their old platforms for something new unless they can see that what we offer can be produced in volume," said Schroeter.
The recently completed fab in Austria is able to produce some 40K square meters of wafer chip surface a year (a phrase that is a throwback to silicon semiconductors).
This is what printable semiconductors from this startup look like
NanoIdent is working with companies in the diagnostics, biometrics, and industrial sensor markets in a classic OEM model.
Low cash burn
The company's co-founding duo is a scientific innovator, Franz Padinger, and an experienced entrepreneur, Klaus G. Schroeter. Padinger sold his last startup, QSEL, which developed the solar cell technology to Konarka Technologies, which is a well-funded startup based in the US.
Before teaming up with Padinger, he founded BioID AG, a biometrics company specialized in simultaneous recognition of face, voice and lip movements and employed 80. It was acquired by a publicly traded company.
Your a:c euro reporter first researched the company back in 2005 and since then it has gone from prototype of one type of optical sensor to being able to offer several kinds of sensors, including diagnostic sensors (for DNA-based blood tests, for example), as well as the handheld reader technology to go with them.
A lab on a chip or handheld diagnostics product
It has done this on a remarkably small amount of invested capital, some €12.5M including debt. It is currently raising €10M in equity financing and hopes to attract family offices or high net worth individuals to the round.
Talent Seeks The Edge
Nanoident employs about 65 scientists and specialized researchers from 12 different nations. "Recruiting talent from around the world is not that difficult. Everyone wants to be on the forefront … to be part of the first company to produce sensors and sensor systems in printed semiconductors," said Schroeter.
The Austrian venture recently moved the headquarters of its diagnostic business unit, BioIdent, to California with a Sand Hill Rd address.
A mobile phone concept with a biometric sensor from NanoIdent
View Nanoident
Posted at 08:26 AM | Posted to Biometrics | Disease/Clinical Diagnostics | News And Updates | Semiconductors | TrackBack | Permalink
Kelkoo's Co-Founder Chappaz To Finance Best Two Minute Video Pitch
On his blog, Pierre Chappaz, a Kelkoo co-founder and former Netvibes co-CEO, has launched a competition for "Internet startups". The team that sends in the best two minute video pitch will get financed. Deadline is Nov 23. It'll help if you can speak French so you can understand his criteria which he's posted here . [via]
Posted at 06:48 AM | Posted to News And Updates | TrackBack | Permalink
Audiotube Music Video on Demand
Audiotube is a new pop music destination site, featuring music videos on demand. The company behind it has raised seed financing from private investors Chris Blackwell, a music and media entrepreneur, Michael Flatley, entertainer and entrepreneur, and corpfin advisory firm Montrose Partners, all in the UK.
With offices in London and Spain, Audiotube was founded in January of this year by Karsten Becker, CTO and Scott deMercado, CEO.
Earlier in his carrier, deMercado was a member of the team coaching heavyweight boxing champion, Lennox Lewis' team - he did strategic planning for all the boxer's major fights. It's a background he'll be able to apply to in the heavyweight battle to win over an audience and compete with rivals.
He also has more recent experience, with Visual Media, where he worked as a bizdev, managing relationships between the company and media producers in industry, government and education.
One of Audiotube's revenue strategies is to work with record labels to offer their clips to its audience to drive traffic back to the label sites to "monetize".
The model and the media mix sounds a bit like Musicbrigrade's over in Stockholm which claims to be the largest European digital music site operator after iTunes. But there is probably room in the market for several more indpendent music sites.
View Audiotube
Posted at 06:39 AM | Posted to News And Updates | TrackBack | Permalink
October 24, 2007
Mind The Gap: US versus Euro VCs Investment Trend
The latest CalibreOne Index, which tracks deals in the US and Europe (including Israel), reveals a widening gap in third quarter between us and Europe in terms of amount invested in startups.
There has always been a disparity between the two regions, with the US typical investing around two or three multiple of what is invested in Europe.
But this past quarter the gap widened. The US went from investing 2.6 times in the first quarter, to 4.7 times in the second, upt to 5.1 times the total amount invested in third. And this desptie some hefty-sized VC rounds in Europe like Viagogo $30M and $27M for Ubiquisys and $27M for Dibcom, $34M for DailyMotion and $22M for Nemerix in the quarter.
The ratio of the total number of investments remains somewhat similar, so what that means is that US firms are raising more capital per round.
It could be that there are several startups that are European in origin and are now categorized as US ventures because of the Delaware-flip thing that a lot of VC-backed startups here do. An example of a European startup that is now categorized as a US one in action is Oanda, which actually raised the largest round in the US index at $100M. One of its founders is still based here in Zurich, for example.
But that kind of thing doesn't change the fact that US ventures raise more money, especially if yours is competing for market share with a US-based one that raised four five times as much capital.
We'll be opening another pack of Red Bull to keep us alert as we keep score here on the sidelines to see if Europe's leaner scrappier techcos can pull out ahead of their richer rivals.
CalibreOne is an executive search firm with a flair for VC-backed startups. Its site is CalibreOne.com
Posted at 10:46 AM | Posted to News And Updates | TrackBack | Permalink
Skype's Michael Jackson Joins Mangrove Capital
The latest issue of Mangrove Capital's newsletter (pdf)features the news that Michael Jackson one of the members of the early management team of Skype has switched to the investment side of the table, joining the Luxembourg-based venture firm. Mangrove, in case you need reminding, was also an early investor in Skype.
He says he might be old-fashioned but he likes tech companies that are selling something. He headed up Skype's tech operations and is a former Tele2 exec.
Posted at 10:37 AM | Posted to Venture Capital | TrackBack | Permalink
October 23, 2007
Ekinops raises €20M and Other Fresh Euro Deals
Ekinops, a French optical networking startup has raised €20M from French VCs in its second round of financing. A number of new customer wins from telecommunications carriers in North America and in Europe is what attracted investors to the deal. Clipperton advised the company on its fundraising.
View Ekinops
Pond Ventures, the early stage UK venture firm best known for semiconductor deals, has made a 7-figure investment in TIOTI, which is a portal around TV programs available on the Internet. It indexes more than 75,000 television shows and offers more than 500,000 individual episodes for download. (Techcrunch UK got the scoop from Pond earlier than the rest of us. )
Iris Capital out of Paris has led a new round in Canadian startup Bluestreak, a $20 million Series D financing round. Blognation France notes that it shares an investor in common with a French rival, Streamezzo. The deal was announced a week or so ago.
View Bluestreak announcement
And finally, ink communications offers up one of its Top Ten lists. This time it's the Top Ten Men of Etre 2007 (ink is a PR company specialized in tech and media).
Posted at 07:41 AM | Posted to News And Updates | TrackBack | Permalink
October 22, 2007
Irish Startup To Speed Trading in London
An Irish startup's whose algorithms reduce IP network latency and lost data packets will be used to speed trading on the London Stock Exchange. The technology has been used by Cisco in its pricey Telepresence videoconferencing gear. LSE is to deploy VC-backed Corvil’s TradElect platform, writes Silicon Republic here.
Posted at 08:41 AM | Posted to News And Updates | TrackBack | Permalink
Puzzler Winner - VC Know-Who
Last week's puzzler question
Since early 2006, at least three European venture capital firms have recruited former Yahoo (Europe) executives to their rosters. Name two VC firms that are benefitting from some Yahoo know-how and know-who.
The answer could have been any two of the following
3i - Daniel Waterhouse
Index Ventures - Dominique Vidal
Accel (London) - Simon Levene
This week's Puzzler was a bit too puzzling, and as a result we have only one winner. The first to write in was Yakov Sadchikov (image right in London), founder of VC-backed Quintura, a multi-lingual search technology company.
He is well-informed, which you would expect from a search engine CEO, and often tips us off to news from Russia when he has time. (For more on Qunitura, see our Q&A published last year here)
Just three other readers wrote in with the correct answer to this stumper of a question. We were hoping for at least thirteen. So we thought to give an honorable mention to those that did. Two who answered correctly are venture capital professionals, Max Niederhofer who recently joined Atlas Venture (he has a blog ) and Fredrik Cassel, a principal at Creandum Advisor in Sweden.
The other reader to write in with the correct answer, like this week's winner, is a co-founder of a search engine company. But we are not going to mention his name just yet -- his startup is still in stealth mode.
Posted at 07:30 AM | Posted to quiz | TrackBack | Permalink
Fast German Tech Companies
The German press has been reporting this year's Fast 50 Technology ranking. The list has a lot of software, digital games, and solar companies near the top with names we recognize because they have either raised money on the stock market (YOC, Delticom, Qcells, Conergy), been acquired (Zanox, one of the largest M&A deals in tech ventures in Germany in the past year), or attracted VC money (mobileobjects, Netviewer, Datango), in the past year or so. And there is one whose founder was one of our a:c euro puzzler winners (Questico).
A couple of the ones that we haven't covered yet (and that fit our tech beat) are listed here:
komdat.com GmbH in Munich, which was number one with 7785% growth. It is an eCommerce agency (SEO, tracking, online marketing etc.)
CipSoft GmbH founded in 2001 in Regensburg with a 3064% growth rate thanks to its popular MMORG games.
Bigpoint GmbH in Hamburg is growing fast on the back of a browser games business and portal.
The ranking is based on turnover growth rates over the past five years. The Deloitte Fast Technology list is here
Posted at 07:07 AM | Posted to News And Updates | TrackBack | Permalink
This Startup Sells Its Software On The Net At A Five Digit Price Point
A self-financed software venture out of Germany that has been selling its software on its website to telecommunications service providers at a price of €10K per seat license.
You won't find too many telco/ISP infrastructure software startups that can sell their products via their website, or ones that can point to using Google AdWords to draw those potential buyers. And we suspect that it is an even smaller number, that after an online demo can sell a product for a price of upwards of €10K via their websites.
But self-financed Enterest GmbH in Norderstedt, Germany is doing it.
On the sidelines of DEMO in Munich last week, we met by chance Martin Laesch, an Enterest co-founder and manager who was there as a guest, not a demonstrator. (That is him on the far right.)
When he told the alarm:clock euro that Enterest's software has generated orders of up to €50K via its website and that it has direct sales customers its team has never met, we were intrigued. His statement said a thing or two right away about the ease of use of its product, and its value in the market it targets.
In a follow up interview, we learned that the Internet is not the startup's only channel -- in the meantime it has some of the sector's top tier systems integrators on board, including Atos, T-Systems, Accenture, and EDS -- but Laesch said that the Internet has proven to be the "best channel to spread the word and get prospects interested".
It counts telcos like swisscom mobile, Vodafone, T-Mobile, and O2 as customers.
The four-year old startup was founded by a team that previously created Solution42 AG, a wireless voice mediation, provisioning and rating technology firm. It was acquired by Portal Software in 2000, and Portal in turn was acquired by Oracle last year.
Enterest's flagship application, “EDR Workbench”, is specialized software. As we understand it, the application is used by different kinds of communications service providers to make sure they collect fees from customers based on the usage of services on offer.
Laesch described it like this: The software is used for a variety of challenges around processing usage information, which in turn is generated through the services provided on networks like mobile, fixed net, IP and content.
The three letter acronym we picked up from Enterest's website is CDR, call data records. It also says it can handle several other types of data records, that is xDR, from the operators' systems.
The founders are Martin Laesch, Andrew Tan and Bernd Niedergesaess.
View Enterest
Posted at 05:57 AM | Posted to Specialized Software | TrackBack | Permalink
October 19, 2007
Fresh Deals: Sic Processing, M&A For Eastern European Games, and more.
+ Globes is reporting that Oberon Media Inc. has acquired Kenjitsu, an outsourcing studio in St Petersburg, and Kiev-based Friends Games, developer of Magic Match: The Genie's Journey. The paper, which speculates that the venture is bulking up for an IPO, said that the size of the transaction was not disclosed, but its sources said the transaction was worth $20 million.
Read - Globes [online] - Oberon Media buys two European companies
+ Tornado Insider is reporting that SiC Processing completed a €53 million financing round. It said that almost a year after the postponement of its IPO on the Frankfurt Stock Exchange, German cleantech company SiC Processing has found other sources of funding.
Read - Tornado Insider - News - SiC Processing completes €53 million financing round
+ Sister site alarm:clock reports that Finland's Recoil Games has been funded.
Read - Gamemaker Watch
Posted at 07:13 AM | Posted to News And Updates | TrackBack | Permalink
October 18, 2007
Ambient Backs European Dogster Clone
Ambient Sound Investments (ASI), the investment vehicle of several of co-founding Skype engineers, is backing United Dogs & Cats, a SocNet for European pet-owners. They took a 15 percent stake and will fund the launch of four new language versions of the company's two websites, in addition to English and Estonian.
The formula has proven popular in the US, with Dogster and Catster being the communities of interest for pet-owners that are probably best-known. After we posted this, we saw that Mashable has some numbers on the US site and trends.
Read - Mashable
Read - United Dogs blog
Posted at 06:30 PM | Posted to News And Updates | TrackBack | Permalink
alarm:clock euro Puzzler - Yahoo Know Who
It is time again for the Puzzler...
Since early 2006, at least three European venture capital firms have recruited former Yahoo (Europe) executives to their rosters. Name two VC firms that are benefitting from some Yahoo know-how and know-who.
The first and the lucky thirteenth will win fame, if not fortune, by writing in with the correct answer. If a startup would like to offer one of its products (e.g a year's worth of free usage of a SaaS personal productivity application, or an office productivity tool) as prizes for the puzzler, please contact us.
Posted at 09:00 AM | Posted to quiz | TrackBack | Permalink
Bug Killer Device Startup Raises Second Round
AirInSpace, a developer of devices that ‘catch and kill’ infectious bacteria and viruses, has raised $8.5M (€6M) in a Series “B” round of financing, according to Aelios Finance blog.
This is more of a medtech deal and not really our beat, but a lot of our readers spend time in airplanes, so we figure this startup's products have a human interest appeal.
The five year old company has three different types of mobile units, but its technology - whose roots reach back to the Russian space program -- can also be used in airplanes to filter out nasty germs, it said in a statement.
Investors are French fund manager Matignon Technologies II FCPR and French private bank Oddo AM (through FCPI Générations Futures)
Read - AirinSpace Raises (aelios blog)
View the AirinSpace Video with some cool footage from Space history
Posted at 06:51 AM | Posted to News And Updates | TrackBack | Permalink
October 17, 2007
SAP To Buy India's Yasu - Business Rules Software Acquisition
SAP AG is buying Yasu Technologies, a maker of business rules management software based in India that is privately owned and employs 120. CIO online said that SAP characterized the deal, which was due to be announced Wednesday, as a "fill in" acquisition that would bridge a gap in its technologies. The size of the transaction was not disclosed.
SAP Buys BPM Vendor to Boost NetWeaver - CIO.com - Business Technology Leadership
Posted at 05:00 PM | Posted to News And Updates | TrackBack | Permalink
DEMO Sidelines: Instant Competitive Intelligence
We go to conferences as much for the content as for the people you meet on the sidelines, and in this respect DEMO in Munich didn't disappoint. We met up with people from several interesting startups, picked up some news too, in addition to the ones on stage and in the exhibition pavillion.
MyTV.de in Relaunch
Frank Didsuzleit (image right), founder of Internet broadcast guide mytv.de, told us over lunch that he's relaunched the company after the partial takeover with Gruner+Jahr fell through earlier this year, causing the previous incarnation of the venture to go into insolvency.
The software has been refined and he's sticking to the original plan to deliver consumers a guide to what's on in the Internet video channels, including streaming, clips, and iptv.
Didszuleit was a co-founder of United Domains, which is now the domain name portfolio tool inside United Internet, Germany's multi-billion euro Internet giant. He's also heading up DomsXL, a domain name broker.
MyTV.de and GoGooRoo
You can always get some instant 'competitive intelligence' at these kinds of conferences. We asked several professionals that invest in digital media in Europe about Didsuzleit's chances with mytv.de.
One offered up the name GoGooRoo as a rival and contender for the spot at the top of the Internet video guides heap.
CommerceTools
We also met CommerceTools founder Dirk Hoerig (image left). In the past year, the Software as a Service launched and it is now enabling a couple of brand-names to sell directly to consumers via their websites.
The market niche that Hoerig's firm is targeting is still quite untapped, a piece of intelligence that we picked up a few months ago here , see answer to question four and five.
Its revenue model, transaction-based, gives it a good selling point, as well as the founding team's experience selling related products in a previous life.
Our instant due diligence with investors on the sidelines offered up rivals in the UK such as Venda, and Demandware in the US, but
Hoerig has this reporter believing he just might be able to grab some market share ahead of them in his target markets.
Demandware, is one that the a:c euro already knew about (see post ). It is a venture led by a co-founder and former exec at Intershop, the once high profile ecommerce software firm out of Germany that reached an incredible valuation during the bubble, survived the downturn, and is growing again in this new cycle.
Venda evolved from MAID, a publicly traded online database provider, and is doing well in the 'bricks and clicks' ecommerce niche, retailers that are developing new, more integrated eShops. A year ago, Venda raised capital from Swedish private equity firm Investor Growth Capital.
Read - Wagner finds $20m for US drive - Times Online
Posted at 03:15 PM | Posted to News And Updates | TrackBack | Permalink
Specialized ERP Firm Gets New Owner
IRIUM, a French software provider of ERP solutions for the heavy machinery industries, has been acquired by a new management team and Occam Capital. The size of the transaction is not disclosed.
Irium's software business generates about €13M a year and is used by distributors, renters & importers of machines, and equipment manufacturer. The new finance and owners plan to develop the growth and development of the company in international markets.
View Irium
Posted at 02:05 PM | Posted to News And Updates | TrackBack | Permalink
DEMO Germany: International Teams, Laser Pointers, And No PowerPoint
At DEMO's first manifestation in Europe in Munich this week, rules like no ties and no powerpoint rule made the pitchfest a little more dynamic than we're used to here. (Computerwoche slide show here).
At the end of the day the DEMO gods, based on best presentation, were FRING, an Israel-based VOIP over mobile startup, as well as Vyro Games (Irish US), IDENT (German startup with working sensors and software that reads gestures) and Stagespace (SocNet/Virtual World).
Voting for the DEMO gods was by the audience using laser pointers at the end of each of the day's sessions. (As the day wore on, the a:c euro noticed that the crowd started to amuse itself by not turning off the lasers after the voting, continuing to pointing them randomly on the screen. Funny that.)
Several startups, including Vyro Games, an Irish/US startup whose Bluetooth gadget could become the Wii for the over-30 stressed out generation, and Red Square Ventures, whose software for mobilephones makes them into music track mashup machines via the ringtone feature, were invited to come back to Demo in Germany, after doing the San Diego DEMO event earlier this year. (Photos at number 17 and 18 in aforementioned slide show).
These two told the alarm:clock euro that the PR, investor contacts, and instant recognition the US event brings is worth the relatively steep investment in time to prepare and money to participate. It was too soon to tell about the European event, despite a good turnout of the region's VC, with Atlas, Earlybird, Neuhaus, Partech, TVM, Target Partners, and HighTech Grunderfonds on hand, they said.
The story goes that DEMO enabled Skype and Six Apart (owns Technorati MovableType Typepad), as well as quite a few other household names to raise capital from investors at the show.
Some twenty companies demonstrated yesterday their mobile, web, and enterprise software innovations. About half the ventures were from Israel, and the rest a mix of Irish, Canadian, Spanish, German, and Russian. IDG seems committed to the event as next year's DEMO Germany is already set for mid-October.
View a partial list of demonstrators here
Posted at 09:23 AM | Posted to News And Updates | TrackBack | Permalink
October 16, 2007
Puzzler Winners - Board Knowledge
The answer to last week's puzzler brought in responses from readers in Germany and Austria, and strangely none from the Nordics.
What is the name of the VC firm that counts Preben Damgaard as one of its six advisory board members?
is Nordic Venture Partners.
The first to write in with the correct answer was Clemens von Bergmann, a senior investment manager with High-Tech Gründerfonds, the German early-stage venture capital fund.
He works with startups to raise funding, find strategic partnerships and helps with post-merger integration. Prior to that, he was an executive at a biometric facial recognition company, which was acquired by Nasdaq-quoted Viisage.com. Software and internet investments are his domain.
The tenth to write in was Stefan Kalteis (image left) of i5invest, an Austrian/Swiss investment firm that he said not only gets involved in supporting portfolio companies, but also funds and builds entrepreneurial management teams around its own ideas.
Previously, Kalteis was with German VC firm Target Partners, where he put to use his background in telecommunications engineering and working in the software industry. He has a blog too, at idee.vc with an interesting format. A dialogue on VC theme, vying the viewpoints of an ambitious investor against an entrepreneur (German).
Posted at 09:30 AM | Posted to quiz | TrackBack | Permalink
October 15, 2007
Neuhaus Invests in Fishlabs- 3D Mobile Games
Neuhaus Partners reach across town to invest in Hamburg-based Fishlabs, a three year old mobilephone games developer. The startup raised an undisclosed amount in its first round of finance.
The company is looking to extend its reach from mobile to online, making the games accessible to players that have a cellular data flat rate plan. The games run on Java and Brew phones.
View Fishlabs
Posted at 03:56 PM | Posted to News And Updates | TrackBack | Permalink
Big Big Euro Software Deals - Impact on Startups
Your a:c euro reporter asked a few regular readers for comment on the impact of the large-sized M&A transaction underway among three of Europe's largest tech companies, the thinking being that it isn't great news for startups that are ready to exit (be acquired by those larger Euro companies), mainly because it means fewer potential buyers. But several readers she contacted disagreed. Read on to see who said what.
At the beginning of the last week, the news broke that SAP made a €4.8M bid for Business Objects, merging two of the region's largest software companies, in a mega-sized deal for Europe.
Billion Euro Deals
Two other large deals in the works are Nokia buying Navteq $8.8B, and TomTom's €2.5B bid for TeleAtlas of Germany (its revenues were about €265M). That is a total of €16.1B being invested by European tech heavy-weights.
M&A activity of this size could mean that there is less appetite to acquire fast moving startups - because the big players will be busy integrating their businesses. It also means a net smaller number of potential buyers.
But Marc Brandsma, of corporate finance boutique Chausson Finance in Paris, and is also a seed investor in startup Netvibes, diagreed.
View From France
"We believe that big deals such as these put the market in motion. Smaller players switch to acquisition mode, and the effect down the line is reaching the startups. More fluidity means more opportunities for startups," said Brandsma.
German Market Viewpoint
In agreement with Brandsma was also Rüdiger Fajen ofConsus Partner in Frankfurt am Main, "The more liquidity there is in the market, the better it is for startups," wrote Fajen whose company typically does M&A advisory on mid-sized deals in Germany, it advises hedge funds on German stocks, and it will also assist tech startups on capital raising (which is how we got to know Consus in the first place).
Liquidity influences the activity of venture capital investors, suggested Faen. "If there are no visible exit opportunities through IPO or acquisitions, VCs start to fear they will not have an exit opportunity and invest less," said Fajen.
When investment bankers talk about liquidity, they are talking about money moving between buyers and sellers in a market.
Fajen also mentioned something that we've witnessed before. He calls it the competition effect. At the alarm:clock we might describe it as fear-induced M&A.
"If large companies are buying, mid-sized companies also start to think how they can defend themselves better and faster against their large competitors, which in turn means they themselves look for acquisitions to help them accelerate their development," wrote Fajen.
"So more movement on the large side of the market is usually also good news for the smaller companies," said the Frankfurt-based investment banker.
It can even be seen in the SAP/BO transaction itself, suggested Fajen: "If Oracle hadn't bought Hyperion, which would have been a perfect match for SAP, they probably wouldn't have paid such a high price for Business Objects."
UK and Pan European Viewpoint
Make it three for three against one was Jean Michel Deligny, founder and managing director of Go4Venture, which is specialized in early stage technology corporate finance in the UK and Europe.
He sees the growth in deal size as a positive, a sign of healthy ambition, and good news for startups. "We now have a handful of European players who not only have the cash, but the will, to become aggressive consolidators of their respective spaces. In short startups are not simply stuck with US buyers, for some there are credible buyers at their doorsteps."
The dealmaking shows that European techs have now a level of "ambition and understanding of what it takes to be successful," wrote Deligny whose company has been advising technology firms throughout the boom, bust, and current recovery.
"This is true for the SAP and Nokia [types of companies] in Europe but also smaller startups," said Deligny.
We still think that startups should break out another pack of Red Bull and stay focused on getting big enough to float. But if an M&A exit is desired, the corporate finance advisors believe there is reason to be optimistic.
In fact, in the days that we put this report together, United Internet, the German web portal, online advertising, and ISP giant, announced it had raised (through debt) €500M for acquisitions, further reinforcing their statements about continued liquidity.
Software Sector Viewpoint
And finally, over at Tech It Easy blog, whose authors are close to the entrepreneurial ground in Paris (its originator Jeremy Fain is an ISV business development office at Microsoft's IDEES unit) see the SAP/Business Objects deal as unleashing some new movement in the startup economy. It will likely add some new business angels and experienced startup founders to the market, he posits.
Anyone saying [losing] France’s #2 software vendor is bad for France doesn’t know how it’s been like to work at BO recently.Speak with anyone at Business Objects and you couldn’t avoid talking acquisition by Oracle or SAP or IBM right away, usually the first or second sentence ... the company is 17 years old so it’s likely most stocks have vested and employees will either join other startups to ‘do it again’ (good for startups), start their own software companies (even better for the economy), or, for the wealthiest, become business angels …
Read - Notes on Business Objects acquisition by SAP « Tech IT Easy
Posted at 07:42 AM | Posted to News And Updates | TrackBack | Permalink
Upcoming events for alarm:clock euro
The press passes are booked for your alarm:clock euro reporter of the first hour, Valerie Thompson, at the following events.
Demo: Germany Tuesday Oct 16
O'Reilly/CMP Web 2.0 Expo, Berlin Nov 5 to 8
European Tech Tour: Web and Communities Summit, Lausanne Nov 14 to 16
Posted at 04:50 AM | Posted to Events | TrackBack | Permalink
October 14, 2007
Buoyant IPO For Germany's Centrotherm Photovoltaics
In the first IPO on the Prime Standard in Frankfurt since the summer holidays, Centrotherm Photovoltaics, illustrates that demand for shares in the solar cell/solar silicon sector is still robust.
Its share price climbed 30 percent on its first day of trading on Friday. Mkt cap on first day of trading €640M.
The flotation created a couple more multi-millionaires in the region, as the majority shareholders post-IPO are the company's executives (through their founder investment vehicles).
View -centrotherm photovoltaics AG
Read - Erfolgreiches Börsendebut (finanztreff)
Posted at 06:42 PM | Posted to News And Updates | TrackBack | Permalink
Quotable Founders: SimplySwitch and Buddi
"I thought it is all very well pitching up and doing training and then charging up to £2,000 a day, but you are only making money when you are working and I wanted to increase my net worth, so I thought I'll set a business up with the sole purpose of selling it. Apparently that's quite unusual. I would have thought it was pretty obvious."
Who said it? Karen Darby in the Guardian last week. The story goes that in 2002 Darby founded SimplySwitch, a utility rates comparison site, and sold it to the Daily Mail & General Trust last year for £22M. SimplySwitch gave its VC backer a fantastic return too, some £8M on a slightly less than £400K investment.
She banked £5m immediately and was on an earn-out that required her to stay at the company for three years and meet certain targets, reports The Guardian. Shortly after selling the company though, she changed her mind and went down to two days a week, turning her back on the earnout.
She thinks people in education and economic development are not setting the right tone for budding entrepreneurs.
"Even with this college, they put on the prospectus how to set up a small business. I thought, why have you got the word small in there? Why has it got to be fucking small? Excuse me, but why? I think they inadvertently limit people's potential.
Read - Interview: SimplySwitch founder, Karen Darby | City | MediaGuardian.co.uk
These are people who knew me through my previous business... people who could give me access to things other than just money."
Who said it? Sara Murray, who founded and sold the insurance rate comparison site now called confused.com. She was talking about the set of business angels backing her new venture called Buddi Limited, which enables parents to track their kids who have to wear the GPS device. The early backers are Fidelity fund manager Anthony Bolton; Michael Jackson, the former chairman of software group Sage; Sir Nigel Rudd, chairman of airports operator BAA; and Roberto Quarta, ex-chairman of engineer BBA.
Read Confused.com founder in funding hunt | This is Money
Posted at 03:25 PM | Posted to Being European | TrackBack | Permalink
October 12, 2007
VC-backed Swiss GPS Startup To IPO
VC-backed u-blox Holding AG said it is planning an IPO on the SWX. The banks have been mandated but the financial details are not available yet, except that it will be a mix of new and old shares sold.
This is an interesting one because it is one of the few Swiss university spinoff companies in the IT/telecoms sector here that has made it to a size big enough to float without getting acquired beforehand.
u-blox was founded ten years ago by team that came out of the ETH Swiss Federal Institute of Technology. It has kept a low-profile in the business press, but has released a steady stream of GPS receiver products over the years. It has about 5M units in the field.
It supplies products for both the US GPS network and for the future, repeatedly delayed, European one called Galileo.
Its backers include 3i and iGlobe Partners, Zug-based Partners Group, which is a fund of fund manager that does occasional direct investments, as well as two Swiss banks.
The company generated SFr 54.4M last year with a net profit of SFr 7.4 million. Sales are up for the first six months of this year by 69% compared to the same period last year.
u-blox has appointed Credit Suisse as Sole Global Coordinator and Bookrunner, Zürcher Kantonalbank as Co-Manager and Helvea SA as Selling Agent for the upcoming IPO.
Read Give Me My Location Now, Right Now
View u-blox
Posted at 03:45 PM | Posted to News And Updates | TrackBack | Permalink
October 11, 2007
Ulteo Financed To Launch Virtualized Desktop and SaaS platform
Ulteo's new virtualized desktop service is taking shape, and so is the company by the same name.
After initially self-financing, Ulteo has raised €400K from private investors, including Daniel Zumino, who is a long time French business angel. For example, he was an early investor in VistaPrint, an online business-card printing company, which went on to raise capital from Sofinnova and Highland Capital Partners, among others, and is now a $1.8B company traded on Nasdaq.
Another early investor and advisor is Alain Revah who brings experience in startups in the US. He contacted Duval by email when he learned that the "Linux legend" had parted ways with Mandriva and was going to start a new project, they've been working together since. (We reported Ulteo's formation here.)
Revah convinced Duval to bring in a CEO, Thierry Koehrlen, who was most recently at Intalio, a VC-backed open source business process management startup in Silicon Valley.
Below you will see a screen shot of Ulteo running access to Adobe Illustrator, that Duval sent through, and pick up what else was said in our interview with the founding team this past week by Skype and by phone.
Koehrlen was also an early investor in Duval's last venture Mandrakesoft, an emerging Linux distribution at the time, which eventually became Mandriva. (See recent post on Mandriva).
"I immediately wanted to be an advisor for Gael when he started the project in early 2006. I got hooked and decided to accept the CEO position that they offered me," said Koehrlen.
In Koehrlen's view Ulteo has all the "key attributes" of a high potential startup. He listed them: it has a "serial entrepreneur founding team, a big vision with multiple potential revenue streams, and structural market trends with lots of players that have a vested interest in helping Ulteo succeed".
Timely Concept
Ulteo offers broadband users access to a desktop pre-loaded with applications and components, via the browser.
Duval said: "We want to simplify the user's experience on the PC, so we plan to offer as many software applications as we possibly can. You can choose and use them without needing to install them. Just click and run. And work or have fun!"
The way it sounds to us (we didn't get to try it yet) is that it is an alternative to, but also can be a complement to, your current PC installation.
Revah believes that users struggle in the face of multiple hardware configurations, OSes, and software vendors. "Ulteo is trying to simplify and reduce hardware/software friction," he suggested.
This reporter is not up to speed on desktop virtualization, but the idea to offer a mass market of users access to productivity applications through a browser, or alternatively a thin client, has been in the tech world for some time.
In the enterprise market, software as a service (SaaS) companies, like salesforce.com, have found a model, as Citrix did before that with a proprietary client.
Consumers in the meantime are getting used to accessing email, blogging tools, and some of the new Web 2.0 personal productivity tools via hosted applications.
In a sign that there is interest in something more, Duval said that 14K people have already registered to give it a try when it goes to public beta. He made made a point of saying that Ulteo is still open for registrations.
An earlier alarm:clock euro article mentioned Ulteo in the context of Nivio, a Swiss/Indian venture, but the founding team corrected us on that view, saying that "the technology is closer to virtualization rather than to any of the so-called webOS companies".
They point to Moka5, a Silicon Valley venture that raised $15M in VC this summer, as being in the same category (see sister site alarm:clock's report here).
Some of the advantages that Ulteo says it can offer is that users do not have worry about viruses, updates, and backups. Users could also try out new applications without downloading hazards, like spyware.
The disadvantage of not having your apps on your hard drive is that you cannot use them when you lose your Internet access. Duval's response: "Our approach is to offer both a system within the web browser and a virtualized system under Windows (for offline mode). We have a very efficient virtual machine."
The whole thing will sync automaticallywhen a connection is re-established, he said.
It sounds ambitious but the current private testing phase will go some way to proving whether or not the systesm that Ulteo's team has put together using equipment from various suppliers can handle the load.
So how much will it cost? "We’ll offer a free version loaded with enough apps to get started. As for premium apps it will depend on the result of our talks with various software publishers and what kind of deal they offer for SAAS mode," said Duval.
The company has 12 developers and is looking to hire more, talented ones that have expertise in Windows servers, Unix/Linux, said Duval. A marketing talent is also on its list of wants.
The next stage of development is to establish a board and raise more capital. Duval hopes to bring together "a good mix of funds and companies, such as hardware makers.
Duval and Revah described other R&D projects in the works that they don't want to see written here. We think it is safe to say that Ulteo is more than a single-product startup.
View - Ulteo
Thank-you for the interview. And thanks for reading the alarm:clock euro.
Posted at 01:41 PM | Posted to News And Updates | TrackBack | Permalink
alarm:clock euro Puzzler - On the Board, Not Bored
A couple of weeks ago we posted that Preben Damgaard, had invested in e-sport startup Regroup. Because he is one of the more successful Euro tech entrepreneurs - he co-founded Damgaard Data A/S in 1983, listed it in 1999, merged with smaller rival Navision, and then sold the ERP venture to Microsoft for $1.55B in 2002, we followed up with him to find out more.
Damgaard told us by email that he actually has several such investments and is quite busy advising and working with the teams. Damgaard is also an advisor to a European early stage VC firm and sits on the board of at least one of its recent investment, which leads us to this week's quiz question:
What is the name of the VC firm that counts Preben Damgaard as one of its six advisory board members?
A clue is that the managing general partner of this fund also worked at Damgaard's ERP company as a biz dev, sales manager, and several other management roles.
The first and 10th reader to write in with the correct answer will win fame if not fortune by being profiled here. We would like to be able to offer the winners a free week of driving the Lexus gas-electric hybrid SUV, dubbed the RX400h, but the promoters of that cleaner-conscience vehicle are not jamming our phone lines with offers.
Posted at 08:42 AM | Posted to quiz | TrackBack | Permalink
October 10, 2007
Founders Sell Stake in Katshing Online Mobile Telephony Retailer
Swedish online retailer Katshing Netsales, whose website's tagline is Katshing - the Swedish Mobile King, has signed over a 20% stake to private equity firm Ledstiernan in a deal that values the four year old and profitable company at about €3.3M.
Anders Phil, founder of Katshing, said in a statement: "The Internet is the most effective and at the same time the most transparent and brutal marketing channel there is .. if you don't continually deliver added value and quality you lose business".
The company, which was self-financed until now, must be doing some of that right because it expects sales to grow by 130% this year to about €13M, and the trend in the last two years is 95% growth. The firm saids its goal is to continue to grow both in Sweden and elsewhere.
Ledstiernan invests in Katshing Netsales
Posted at 03:51 PM | Posted to News And Updates | TrackBack | Permalink
Hot Alpha and a Gamma: Moovement.fr, Comapping, and Wua.la
Our Hot Betas feature morphs beyone recognition, except for the fact that we are still reporting on new web-based services and applications. The ones we profile here all contacted us within the last week, or so. It is a diverse group, a French job aggregator service, a mind-mapping software startup out Copenhagen, and an online storage company from Zurich.
Moovement Version 2
Richard Menneveux let us know that Moovement just launched a new version of its online job aggregating service. It has about 70K jobs in it now and when it comes to usability, let's just say it makes you appreciate Web 2.0.
Menneveux said he's ramping it up now and plans to raise €2M from outside investors. Moovement is owned by its two founders and one private investor. A feature our readers might like is the Startupjobs feed. This version is dubbed a gamma. Saurier Duval may have trouble with classifying that one, but we're sure he'll find a way.
View Moovement
Global Brainstorming With CoMapping
Comapping is from Denmark and is not in beta, rather it is already commercial. It offers web-based mind-mapping tools, targeting the corporate market, although it does have individual users too.
Business is good, according to the firm's CEO Omar Ahmed, who also told us a bit about how some of the user organizations surprised his team with the way they use the tool, which also saves your data locally in case you lose the Internet connection.
A quick glance shows there's been time spent on design and usability.
Given the positive feedback from customers, he fears he may have priced the software as a service too low. "In terms of pricing we are the cheapest in the market at $11.99 for 6 months. In hindsight, we might have priced it too low because price was never an issue selling to our customers," wrote Ahmad.
The startup has an experienced team behind it and is the result of a Danish/Russian dev coooperation.
View comapping
Wuala's Disruptive Online Storage Model
A low-cost infrastructure enables this tiny startup to offer an online storage service along the lines of some bigger competitors. It is from Switzerland.
When he was a student at the ETH (Swiss Federal Institute of Technology Zurich), a project Dominik Grolimund was working on caught our eye, as its aim was to develop a distributed storage platform. We wrote to him at the time, and he responded that it was part of a Masters thesis and that it was too early to talk about it.
Almost two years later, Grolimund wrote back, telling us he has founded a company, and launched its first service in alpha, called Wuala.
Wuala offers users 1GB of storage for free, so do a lot of others in this category. We asked why do you think you will be successful?
"There are tons of existing online storage services, there's Flickr, there's YouTube, so that's certainly a justified question," wrote Grolimund, adding that there is Box.net, Streamload, X- Drive, and Microsoft SkyDrive.
Wuala's advantage he said is that it takes "the power of p2p to make it fast" and to reduce his infrastructure costs so that he can "provide a better service for free".
It is free in the sense of you don't pay any money to use it, but you do have to share your PCs memory resources. It's like Skype or a Bittorrent application, you need a client, and it is based on peer to peer technologies.
We asked for a comparison to AllPeers, a VC-backed startup we've covered here. Grolimund said that Wuala is different from the "send semantic", that is "inherent to AllPeers, YouSendIt, and the like", and that if we are bringing up Allpeers, he said, then we might as well throw Pando in there too.
Apparently, others have compared his product to Pando too.
Grolimund give us a comparison of features and functionality with AllPeers, which uses the BitTorrent protocol to share files, but it required some knowledge of the usage and the technical details of the underlying platform - not possible for us to judge his evaluation. The essence of it is that Grolimund's view is that BitTorrent model has a weakness when it comes to sharing private files.
He sums up Wuala like this: "We've taken the P2P model, added encryption and persistence, and applied it to online storage. "
We figured we better put up our profile on this one quickly, before it gets acquired by Google (see our earlier post on Jaiku this morning). Not that Grolimund suggested that this was his plan. He's actually in Silicon Valley right now making some visits to journalists and 'early adopters'.
View Wuala
Posted at 12:39 PM | Posted to Early stage | TrackBack | Permalink
flauntR Founder On Competing With Adobe and Low-cost Startups
Today we have a QandA with Bal Balaji, currently heading up online photo editing site flauntr.com, and founder of the company that developed it, DeviceDriven.
Regular readers will recognize his name as the founder and former CTO of mobile software firm Surfkitchen, and because he's won our puzzler contest a couple of times by now.
Read on to find out what happened when he launched the web-based image editor a week or so ago, how he's proven his concept of 'affordable startups', and why this entrepreneur won't tell you which mobilephone is the best - we've tried to get him to give us advice on the topic to no avail.
The following is based on a demo and interview in Zurich with follow up by email.
We read that the one-click wizardry that flauntr offers is an Adobe Photoshop "killer" (source Killer Startups review). It is not the first time you've created something to challenge Adobe, right?
Right, I founded SurfKitchen which competes against Adobe in the on-device-portal space. SurfKitchen continues to hold its ground. As a result I know quite a few “great” people at Adobe. But that does not preclude hand-to-hand combat in the marketplace.
Calling flauntR a Photoshop-killer is flattering but inaccurate. Photoshop is a power tool for professionals with a steep learning curve and 600 dollar price-tag to match. FlauntR is a free online creative suite for image editing with one-click effects aimed at consumers.
You told us that the tool had 5000 users register in the first two days. You didn't put out a press release or get written about in TechCrunch or Slashdot, so how did the word get out?
Last week was amazing. Within a week flauntR moved from 250 to 200,000 results in Google. Adobe featured flauntR on their flex.org showcase. flauntR was also the editors pick on the Yahoo gallery.
It all started with some small, quality bloggers who covered flauntR in great detail. One of them called “DemoGirl” even did a screen cast.
Within hours it was in German, French, Italian, Portugese, Romanian, Spanish and even Chinese blogs. We guess it is the quality of the posts by the bloggers which delivered the numbers.
How will you generate revenues?
Image editing will always remain free for consumers, we will not have a "freemium model". Printing, which we will launch prior to Christmas is a key revenue stream. There are other equally significant revenue streams which we would rather not disclose.
On the KillerStartups site, our vote was that FlauntR would get acquired. The majority of other readers at that point in time voted that it would receive VC funding. Any comments?
flauntR has begun raising a round of funding as backup for the funding provided by DeviceDriven. We have to admit that there are signals of interest in acquiring the company. This is primarily due to its unique position in the digital imaging value chain. So we are also taking an immediate exit possibility seriously.
What kind of integration to the bigname social networks and photo sharing sites do you have, and why?
At present flauntR supports only flickr. flauntR will be integrated with 16 photo sharing sites and social networks within 2007. This is because flauntR’s image editing capabilities are complementary to photo sharing and social network sites.
You said that flauntR was developed by DeviceDriven, your software design services company based in India. How long did it take your team to develop it?