Friday, February 26, 2010

Mobile Madness, March 9, Should Attract Both Inventors and Investors

Full details describing Xconomy’s next big event, Mobile Madness: The New Future of Computing, are now available online, reports Chief Correspondent, Wade Roush.

Headlining the afternoon are keynote speakers from leading global, national, and regional organizations: Jhonatan Rotberg, executive director of the MIT-based Next Billion Network, will talk about the role mobile technology can play in solving social and economic challenges in the developing world; and Kate Imbach, Co-Founder & Organizer at Mobile Monday Boston & Silicon Valley and vice president of marketing at Skyhook Wireless, will walk us through the latest facts and figures on venture investment in the mobile technology sphere in New England (full agenda here).

Of special interest to Angel and VC investors will be a Mobile Showcase featuring 10 mobile startups. Presenters will give one-minute lightning presentations, and then the whole audience will adjourn to the lobby area at Microsoft, where representatives of the showcase companies will be available for one-on-one conversation around tables supplied with a variety of demos and handouts. Those presenters include Apperian, Appswell, bitHeads (from Ottawa, Ontario), Illume Software, the Public Radio Exchange, Roam Data, Rummble (from the United Kingdom), Sand9, SparkCloud, and WherePhone.

You can register here.

Tuesday, February 23, 2010

Angel Investor Groups, Still Here, Still Helpful, Still Free

As someone who has had the rare opportunity to know personally many of the leading Angel Investors active today, I have been distressed by some of the comments I’ve read lately disparaging angels. To be fair, many are also disparaging VCs. And many of the irritating posts are on blogs and tweets, not widely read, but some of this nonsense has even made its way into the NY Times.

The catalyzing issue lies in charging large fees to entrepreneurs.

To start, you might look at a post this Monday by Dan Primak in his widely respected and circulated newsletter, PEHub.

Says Primak: “Last week, a Silicon Valley investor named Hugh Sloan III came across a startup that had received a minor award from Microsoft. He emailed the company founders, saying he had “3 ex Google angels and two Tier 1 venture funds who would be looking at this opportunity with me.”

“Sounds great, except there was a giant catch: Sloan wanted $7,500 up-front, in order to set up the meetings. No refunds if the investors didn’t offer term sheets.”

You can find Dan Primak’s article, plus comments including replies from Hugh Sloan III, right here.

Primak is following up on an earlier post by Jason Mendelson, “Watch Out Boston, A Rip-Off is Coming to Town”. Jason is concerned by the following event:

• Name: Young Startup Ventures
• Date and Location: April 21st, at the Microsoft New England Research & Development Center in Boston, MA.
• Cost: $4,500.

Quoth Mendelson: “Now unlike some other events like this, there are a list of credible VCs attending and it is being held at Microsoft. This makes it all the more worse. I bet that some are unaware of the payment mechanism.” Read the comments on this post also. 

So what’s my gripe? I think Primak and Mendelson, as well as Jason Calacanis, who has been leading the charge against these practices for some time, are doing a good job both for us for us and for the entrepreneurs. The problem is that some reports take these isolated instances and turn them into a trend. Should you doubt me on this, read “Angel Investors Become Less Available” from the NY Times.

To check what’s really going on, I  contacted some of the active and respected Angel Groups here in the Northeast. My findings: fees to entrepreneurs are rare or de minimus.

The four oldest active Angel Groups in the Northeast do not charge. These are: The Breakfast Club, Common Angels, eCoast Angels, and Walnut Group. Others with no charge include River Valley, Angel Investor Forum, Boynton Angels, Hub Angels, Cherrystone, Beacon Angels, Launchpad, ECS Angels, Maine Angels, Rochester Angel Network,  Race Point Capital, Bay Angels, Granite State Angels, and North Country Angels. One group, Golden Seeds, charges $100 to apply.

I also received a note from Marianne Hudson, Executive Director of the Angel Capital Association, who writes “basically ACA is in favor of no or very small fees, as well as transparency to the entrepreneur if there are fees.”

If I can determine this in a day, imagine what the NY Times could have done to encourage entrepreneurs to seek out ethical angel groups if they had spent some time researching this topic.

If you want to contact any of the groups mentioned in this post, most are listed in the ACA Directory, along with many other groups throughout North America.

My conclusion: reputable and established Angel Groups are not charging entrepreneurs any significant amount to apply or to present to the group. This means a lot of experienced and successful people are contributing their time as well as their capital to launch new companies and build our economy.

Why do they do it? I’ll quote my friend Mort Goulder, now deceased, co-founder of The Breakfast Club, one of the first and foremost Angel Investment Groups in the World. “Here’s why I do it. I figure this system we have, this start-up economy, has been really good to some of us, like you and me. I feel in return we have the obligation to see that the other guy gets his chance too.”

Conflict alert: I am co-founder of the eCoast Angels Investment Network, an achievement of which I am particularly proud. With special thanks for prompt responses to James Geshwiler, Paul Silva, Charles Cameron, Liddy Karter, Chris Golden, Peter Dorsey, Joe DeMartino, Lucinda Linde, Bill Swiggart, Ham Lord, Charles Sidman, Ralph Wagner, Marianne Hudson, Jean Hammond, Christopher Mirabile,  Jim Senall, Fred Wainwright, Corey Silva, and Robert Lamkin.

Monday, February 22, 2010

The chip wars are about to become even more bloody...

In this next phase, the chip manufacturers fight a "Battle Royal" to supply the silicon for one of the fastest-growing segments of computing: smartphones, tiny laptops and tablet-style devices.

The NY Times analyzes the match. “The fight pits several big chip companies — each trying to put its own stamp on the same basic design for mobile chips — against Intel, the dominant maker of PC chips, which is using an entirely different design to enter a market segment in which it has a minuscule presence.”

Intel remains the last mainstream chip maker to both design and build its own products, which go into the vast majority of the PCs and servers sold each year. Most other chips are built by a group of contract manufacturers, based primarily in Asia, to meet the specifications of other companies that design and market them.

Intel’s Atom line of chips, used in most netbooks and now coming to smartphones, can cost two to three times as much as competitive chips. In addition, the Atom chips consume too much power for many smaller gadgets.

Intel executives argue that consumers will demand more robust mobile computing experiences, requiring chips with more power and PC-friendly software, both traditional Intel strengths.

“As these things look more like computers, they will value some of the capabilities we have and want increasing levels of performance,” said Robert B. Crooke, the Intel vice president in charge of the Atom chip.

I tend to be with Intel here, but I fear they may be making a dangerous mistake. The original Atom chips could support Intel’s Virtualization Technology. Those features seem to be missing from the newest Atom chips, making it unlikely that you can use virtual machine technology on a smartphone to make that phone a full participant in Cloud Computing.

Interestingly, articles from the NY Times are not available online unless you are a subscriber. But the same information is sometimes posted on the NY Times blogs, which are at present outside the “paywall.”

Find Ashlee Vance's article about the forthcoming battle here. You might also take a look at a blog post by Nick Bilton with a wish list of features for future cell phones A second advantage of reading the blogs is that you can also read the comments; the wish list attracted quite a few.

Thursday, February 18, 2010

Vanishing Public Companies Shrinking Silicon Valley?

Very occasionally I find a blog post that provokes sufficient thought that I want to reproduce it in its entirety, hoping that a) the original author will be flattered rather than offended, and b) the readers of this blog aren’t reading exactly the same things I am.

 SiliconBeat, a blog from the San Jose Mercury News, postulates that the reduction in the number of public companies has led to a shrinking of Silicon Valley. I myself don’t have the data or resources to perform a similar study for the Boston area, but I would be delighted if someone at the Globe or Xconomy does.

The post by Chris O’Brien: Vanishing Public Companies Lead To The Incredible Shrinking Silicon Valley

“One of the most significant trends I’ve been watching over the past decade is the dramatic drop in public companies in Silicon Valley. Naturally, that number was artificially inflated during the dot-com bubble when it reached 417 in 2000. For our purposes, Silicon Valley includes San Mateo and Santa Clara counties, and the southern half of Alameda County.

“But the number of public companies has dropped for nine straight years now. Even when IPOs briefly reappeared in 2006 and 2007, they weren’t enough to overcome the net loss of public companies through acquisitions or bankruptcy.

“In 2008, the number had fallen to 261. We just updated our records and the latest figure is 241.

“That’s not just less than the dot-com era, that’s well below the 315 public companies the valley had in 1994 when the Mercury News started keeping track.

“Here’s why I think this is a big deal.

“First, it points to the massive consolidation at the top of the pile. The biggest companies continue to get bigger, in large part through acquisitions. This includes Hewlett-Packard, Oracle, Cisco Systems and now Google. We’re known for our start-ups, but increasingly the valley landscape is becoming dominated by these big enchiladas. That’s bound to have an impact on the rate of innovation.

“Next, the IPO remains a lost dream. Yes, it briefly reappeared last decade, but even in the good times last decade, they were nowhere near the pace of the early and mid 1990s. The IPO is dead, and it’s time to let go and rethink the way innovation gets funded and rewarded.

“Increasingly, venture capitalists have to look to acquisitions as the best hope for an exit. And these simply don’t produce the returns that an IPO homerun does. That means a big shakeout in the VC community is inevitable. Though it will unfold over many years, in a kind of slow motion implosion.

“Each year, we publish our SV150 section that looks at the top 150 public companies in the valley. At the pace we’re going, by the end of this decade, we won’t even have that many public companies.

“The valley has always managed to adapt to such fundamental changes. But I think the continued disappearance of public companies will pose one of the valley’s greatest challenges. If the valley remains on top in 10 years, it will be because the innovation economy looks far different than it does today.”

Thursday, February 11, 2010

March is Mass Mobile Month: Celebrating New England Innovation

Its official, March is Mass Mobile Month in Massachusetts with a mind boggling array of events planned.  That’s Mass as in Massachusetts, but it’s also mass as in huge, because it’s going to be a gigantic month of mobile-related activity around town and around the world. The list of events is too long to include here—which is exactly why our friends at Xconomy have created the Mass Mobile Month website, a clearinghouse for information related to the all of the mobile conferences, camps, seminars, showcases, and networking events going on in New England.

Wonder what makes it official? Check today’s post by Wade Roush on Xconomy Boston for the official word.

I have signed up for two events already.

First is the Xconomy Forum: Mobile Madness, scheduled for Tuesday, March 9, 2010, 1:30 - 6:00 pm at Microsoft NERD in Cambridge. From the invitation by Bob Buderi:

“As computing enters what many analysts agree is its fifth great historical cycle (after mainframes, minicomputers, PCs, and the desktop Internet), New England companies are poised to lead in many areas--including mobile application development, infrastructure, and advertising. But the platforms and markets are evolving fast. At Xconomy's Mobile Madness conference, keynoters and panelists from the region's leading mobile technology companies will help participants make sense of the chaos and separate the solid innovation opportunities from the hype.”

Confirmed Speakers & Participants Include:
Wendy Caswell, CEO, Zink
Walt Doyle, CEO, uLocate
Chuck Goldman, CEO, Apperian
Will Wang Graylin, CEO, Roam Data
Kate Imbach, Vice President, Marketing, Skyhook Wireless; Organizer, Mobile Monday Boston
Mark Lowenstein, Managing Director, Mobile Ecosystem
Dan Olschwang, CEO, Jumptap
Greg Raiz, CEO, Raizlabs
Jhonatan Rotberg, Executive Director, Next Billion Network
Jake Shapiro, Executive Director, Public Radio Exchange
Dan Sullivan, Founder, Appswell
Mark Thirman, Vice President, Business Development, Illume Software

I have also signed up for the Tech Tuesday mobile event which immediately follows the Xconomy forum and showcase reception. Tech Tuesday requires separate registration.

So it is official, Mad Mobile races the March Hare,  in Mass., in March. Be there.

Wednesday, February 10, 2010

Nicera, a New Virtualization Company to Follow

VMware’s founder Diane Greene has resurfaced, writes Alessandro Perilli in Greene appears as an investor in a startup named Nicira, along with Andy Rachleff, Partner at Benchmark Capital.

In July 2008, the VMware Board of Directors removed founder Diane Greene as CEO. Greene was offered another position that she declined, leaving the company that she created and led through one of the most impressive IPOs in IT history.

Nicira, founded in early 2009, is in stealth mode at the moment but its website reveals its mission is to virtualize networks. The company is managed by Steve Mullaney, who comes from Palo Alto Networks and Blue Coat Systems, where he was Vice President of Marketing.

According to Rachleff, Nicira appears to be working on a “Network Operating System” or NOX.

A number of employees, along with Stanford and Deutsche Telecom researchers, published a couple of research papers (one and two) about this topic in late 2009. The team advocates the need for a centralized programmatic interface to observe and control large scale networks. The NOX would provide such API while 3rd party vendors would build applications that leverage the API.

I'm looking forward to reading these technical papers and on learning more about Nicira.

Wednesday, February 3, 2010

Larry Ellison, Cloud Contrarian

We cloud believers should find it intellectually refreshing to confront a heretic. We find a famous one in “Larry Kills Sun's Cloud: A Sign or Spleen?" by Michael Neubarth in CIOzone(TM):

“After Larry Ellison’s public displays of ridicule and contempt towards cloud computing, it came as no surprise when Oracle, in its recent briefing event to disclose its plans for Sun’s technology, listed Sun’s Open Cloud initiative among the casualties.

“’We don't plan on being in the rent-by-minute computer business,’ Oracle chief corporate architect Edward Screven was widely quoted as saying.

“Meanwhile, it’s unclear whether cloud computing is a major disruption or an overhyped fad that will blow over. The predominant view of analysts is that the traditional software business of Oracle and other vendors, including IBM and Microsoft, is threatened by the cloud. Gartner recently made the bold prediction that 20% of all businesses would have no IT assets by 2012 because of movement to the cloud.”

Competing with Amazon and Google in the cloud certainly threatens profit margins. Yet unlike Oracle, other major vendors that have reason to be threatened are fielding cloud offerings and presenting themselves as pro-cloud—including IBM with Blue Cloud and Microsoft with Azure.

And the cloud isn’t the only threat to current industry practices. Here in the Boston region, Xconomy has taken a leadership role in cloud advocacy. Xconomy also organizes seminars on mobile computing, which certainly presents an even greater threat to traditional software pricing and delivery than does the cloud. If the triad of smart phones, the cloud, and virtual technology are truly IT's Perfect Storm, then Ellison’s yacht, however large, may well be sailing toward perilous conditions.

Although Oracle has announced the termination of Sun Open Cloud, the technology has already been developed, so it could simply be put on ice and, if the cloud does take off, be resurrected in the future says Neubarth.

“Was killing the Sun Cloud a savvy move on Oracle’s part, a deep reading of the market’s pulse by Ellison, or an act of spite, born of frustration? Will Larry be vindicated when Oracle conquers the data center, or will his animosity towards the cloud come back to bite Oracle?”

Xconomy Cloud3 Presentations Available

I attended Xconomy’s Cloud3 Forum last month (December 10). Once again, they attracted a sellout crowd of 220 professionals. To reduce the strain of taking detailed notes, I asked moderator Wade Roush if he could post the presentations online. Seven companies allowed this; you can download and review them here.

Posted are presentations from seven speakers :Tom Leighton at Akamai, Joe Chung at Allurent, Michael Feinberg at EMC, Jim Cuff from Iron Mountain, Hasan Alkhatib at Microsoft, Anand Rajarem at Pixily, and last, (but very far from least) Greg Arnette from Sonian.

During the lectures, we used the Twitter “backchannel” to collect audience comments. Here are a few from a well respected local technologist you can use as a guide to the presentations:

“#xcloud EMC's Feinstein describing Atmos hybrid/federated cloud strategy.. damn good ideas.. from a Mass co.. How come nobody knows?

“#xcloud Conf terrific after coffee break.. Caffeine got the animal spirits stirring! EMC Cloudman Feinstein giving meaty talk'

"#xcloud Ex-Microsoftie, now Googler @dondodge blogging on his new Mac! .. no Win VM methinks

"#xcloud Breaking News! Microsoft's Vision detailed in today's presentation!

"#xcloud. 25 min into Azure prez and finally substance.. Azure GA on New Years Day, billing on Feb 1, 2010. But WHAT is still mystery.

"#xcloud MS Azure speaker giving Cloud 101 speech to Cloud grad students. Instead of pablum, how bout substance. What will it be? When?

"#xcloud Greg Arnette fm Sonian speaking.. Probably the sharpest cloud tech East of the Valley

"#xcloud Conference: Iron Mountain speaker.. Nothing new here... Next!"

*    *    *    *

I am currently reviewing the Azure presentation. If you are interested in Microsoft’s Azure, a new paper by David Chappell, "Introducing Windows Azure",was posted on the Azure Website in December.

Monday, February 1, 2010

Thin margins in mobile broadband too

Yesterday I cautioned entrepreneurs to beware of thin margins for smart devices. Of course, the margins need not be thin if you can get someone else, say AT&T wireless, to bear much of the sales, marketing, and support expense. A short comment by Graham Lawler in today’s NY Times Business Section lets the helium out of that dirigible.

Regarding AT&T’s Q4 results, Lawler opines that “Network usage increased 200 per cent but wireless data revenue increased only 26 per cent. Seems like great evidence of declining margins in mobile broadband.”