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Posts Tagged ‘Research Triangle’

New format adds zest to CED Venture event this month

Monday, September 9th, 2013
Mike Elliot of Noro-Moseley Partners

Mike Elliot of Noro-Moseley Partners

RESEARCH TRIANGLE, NC – The CED’s annual Tech Venture Conference has acquired new energy with a format that speeds about 50 young startup companies through lightening demo rounds, says Noro-Moseley’s Mike Elliott, a managing partner in the Atlanta venture firm.

“You spin through a number of presentations and never have a chance to get bored,” he says of the three-minute rounds. “They leave you wanting just a bit more.” For a startup, that’s a good way to initiate contact with an investor: leave them wanting more.

Set for September 17-18 at the Raleigh Convention Center, the annual event draws some of its new energy from the vibrant and growing early startup hubs in the Triangle’s three cities.

Bustling startup hubs in the RTP

“Today, especially in downtown Durham, but also all over Raleigh and Chapel Hill we’re seeing tremendous activity from early-stage startups,” says Elliott. That fact has shaped this year’s focus, as well, he adds.

“What both the startups and investors need is to take companies to the next level and we tried to theme the conference in that direction this year,” says Elliott. “You’re up and running, how do you kick it into growth,” he adds.

To bolster that theme, the event features “A number of CEOs who began life at very early stage companies and were able to find the right switches to hit and push them into high growth mode.”

Those include Mike Cote, chairman and CEO of Atlanta-based SecureWorks, which was acquired by Dell in 2011; David Morken, co-founder and CEO of Triangle-based Bandwidth; and Mark Norman, president of Zipcar.

Elliot, however, points out that the entrepreneurs and investors will also hear from top corporate development people from Red Hat, Google and other firms, to “Get a clear picture of the characteristics they’re looking for in partners or acquisitions and how you can set your company up to grow inside a company like theirs.”

 

 

WedPics bucks RTP trends to land seed round

Wednesday, May 29th, 2013

wedpicsJustin Miller says there is more to the recent $1.1 million funding round for his Raleigh-based startup WedPics than money. “It’s a win for the area,” says Miller, who founded the company originally known as “Deja Mii” near the end of 2010.

The company, which created a free photo sharing app for wedding couples and guests, is not in the Research Triangle area’s sweet spot, Miller says.

“While North Carolina is a rather abundant place for startups,” Miller says, “they’re often overshadowed by the presence of Fortune 100 companies and the typical startup pre-funding here is for revenue producing B2Bs. The traditional investors in this region run from anything else such as social media and pre-revenue B2C.”

Miller and his 12-person crew refocused WedPics, changing more than the name. Originally started with an early revenue model, the firm dropped that to focus on user acquisition for a free service that is data and analytics backed.

Because of that, the company presented potential investors with data-backed forecasts. It convinced them – although it took nine months, Miller notes.

Lands oversubscribed round

In mid-April, it closed an oversubscribed $1.1 million round  comprised of a diverse group of strategic local and nationwide investors. The round was ded by the Brenden Family Growth Fund and including Bob Young (Red Hat Co-founder, Lulu.com Founder); Jed Carlson (Reverbnation Co-founder); Henry Copeland (BlogAds CEO); Chandler Rose (ProVantage Corporate Solutions Founder); Alex Osadzinski (former Trinity VC); Culin Tate (Co-Founder ofMissNowMrs.com); and TAP (Triangle Angel Partners).

Miller explains, “From our initial launch as deja mi – the location based photo/video sharing platform which was often pitched as a theoretical idea of what it might be able to do – pivoted to a data and analytically backed platform, which has disrupted the traditional wedding space in a big way. We currently have over 130,000 users and acquire 1400+ daily, with over 1200 weddings per weekend, and sharing over 100,000 photos each week (1 every 6 seconds).”

While many other photo apps died off, WedPics “Applied its technology to a niche market and capitalized on it,” Miller says.

He expects the company will be back on the fund-raising trail again soon and eventually should be a “cool acquisition play for a larger company,” he says.

 

Top ten cities for private tech M&A ranked

Tuesday, February 26th, 2013
Washington DC

Washington, DC made this years list of the top ten cities for private tech M&A at number 7.

PrivCo has released rankings of the Top U.S. Cities For Private Tech M&A, based on the number of private tech companies acquired in 2012.

PrivCo has provided its Exclusive Top 10 Ranking below, with Silicon Valley ranking as the #1 metro area with 226 private tech company acquisitions in 2012.

Ranked just behind it were New York (Ranked #2) & Boston (Ranked #3).

San Diego, Research Triangle miss top ten

Interestingly, up-and-coming tech hubs like New York City, Los Angeles, and Atlanta are challenging traditional leaders like Raleigh-Durham’s “research triangle” and biotech hub San Diego, who missed this year’s Top 10 U.S. Cities For Private Tech M&A.

Top 10 U.S. Cities For Private Tech M&A in 2012

(Ranked By Total Number of U.S. Private Tech Companies Acquired in Each Metro Area)

1. Silicon Valley
2. New York
3. Boston
4. Los Angeles
5. Seattle
6. Austin
7. Washington, D.C. (Arlington)
8. Atlanta
9. Dallas
10. Houston

To access PrivCo’s 350 page 2012 Private Tech M&A Industry Report:

http://www.privco.com/products/2012-m-and-a-industry-overview-technology-sector-volume-I

Cherokee McDonough Challenge seeks Green startups

Thursday, February 21st, 2013

Cherokee McDonough ChallengeWilliam McDonough, winner of two U.S. Presidential awards for environmental sustainability, is teaming with Cherokee to support environmental startups through the Cherokee-McDonough Challenge.

Based in North Carolina’s Research Triangle, the Challenge is designed to identify, fund and develop high impact environmental startups.

Now accepting applications, the Challenge is sponsored by Cherokee, an investment fund manager and globally recognized leader in environmentally sustainable business practices.

McDonough, co-author of Cradle to Cradle: Remaking the Way We Make Things (2002) and The Upcycle: Beyond Sustainability — Designing for Abundance (2013), will partner with an advisory committee of experienced entrepreneurs and investors to counsel the Challenge entrepreneurs.
Challenge will invest in five startups

“The Cherokee-McDonough Challenge is important because it encourages and empowers solutions to the massive environmental challenges that face our world,” says McDonough.

Now entering its third year, the Challenge will again invest in three to five high impact environmental startups.

Each venture will receive:

  • $20,000 in seed funding
  • free office space for three months in Raleigh, NC, (a focal point in the renowned Research Triangle)
  • complimentary back office support from Cherokee Investment Services, including help with incorporation, accounting and IRS compliance
  • hands-on mentoring from an advisory committee of experienced entrepreneurs and investors
  • an opportunity to present to other investors and the public

Cherokee-McDonough Challenge portfolio companies should finish the summer with a working prototype, a refined and vetted environmental strategy, a professional web presence, knowledge of intellectual property strategy and tactics, investor-ready fundraising documents, a stronger network of investors and mentors, a polished pitch and a runway towards a Series A capital raise.

For more information, visit www.cherokeechallenge.com or email JT Vaughn atjvaughn@cherokeefund.com or challenge@cherokeefund.com

Venture funding fell 10 percent, number of deals declined in 2012

Friday, January 18th, 2013

NVCAIf it seemed harder to raise money last year, it was. Venture capitalists invested less money in 2012 than in 2011, the first such decline in three years, according to the National Venture Capital Association (NVCA) and PricewaterhousCoopers MoneyTree report.

In the Research Triangle, NC, which has bustling startup hubs in Durham, Raleigh, and Cary, companies raised less money than in any year since 1997, despite something of a rebound in the second half of the year.

Analysts say economic uncertainty and volatility as well as Facebook’s less than stellar IPO performance contributed to the caution on the part of VCs.

Venture funds invested $26.5 billion in 3,698 deals in 2012, a 10 percent decline in dollars and 6 percent drop in the number of deals.

Mark Heesen, president of the NVCA, however, looked on the bright side, saying that fewer funds and deals will lead to “a more disciplined environment,” in which better companies will get funded and many “me-too” firms copying other successful companies will not.

The full set of statistics are on the NVCA web site.

 

Durham expanding its increasingly robust startup ecosystem

Friday, November 16th, 2012
@MainStreet

Artist’s rendering of the new Durham @Main Street site for startups, expected to be ready by spring.

Durham, North Carolina is expanding it’s increasingly vibrant startup ecosystem.

The American Underground — located near the Durham Bulls baseball stadium, is expanding to a downtown space custom designed for early stage startups.

The Research Triangle area, long known as a top U.S. technology hub with tenants such as IBM, Cisco, Glaxo Wellcome, RTI and others, has also generated startups that became industry leaders such as SAS, Red Hat, Bandwidth and Quintiles.  Not only Durham, but Cary and Raleigh are also evolving strong startup support systems.

The new Durham space, located at 201 West Main Street, the new space is an extension of the award-winning American Tobacco Historic District, home to the original Underground hub as well as many sizable mature companies, and strategically located between Research Triangle Park and world-class universities.

Space for 50 startups

Underground @Main Street, as the expansion hub is known, weighs in at 22,000 square feet with room for about 50 startups (see list below of already-committed companies).

The space — expected to open in the spring — covers two floors and will employ lessons from around the tech world to foster the collaboration, learning, and connections young companies need to thrive.

The City Center building at 201 West Main Street, owned by Self-Help, has a history of hosting entrepreneurial initiatives including the Bull City Startup Stampede and now houses prominent technology companies PathCentral and Blogads.

The new @Main Street site adds to Durham’s growing startup hub, which already boasts close to 100 early stage companies in residence,  The Triangle Startup Factory accelerator, and packed networking events.

Partners put muscle in the ecosystem

Underground leaders recruited regional partners, including the Research Triangle Park Foundation. Says CEO Bob Geolas: “We believe in investing in the entrepreneurial community and we are committed to making those investments and partnerships work. RTP is focused on regional entrepreneurship that will create more jobs and educational opportunities for our state.”

NC IDEA — a catalyst for young, high-growth, North Carolina tech companies — will sponsor relevant content for entrepreneurs via events, networking and other programming.  University partners include Duke, NC Central, NC State and the University of North Carolina at Chapel Hill. More information on their plans is coming in early 2013.

Bandwidth, a Triangle-born company that has grown into one of the nation’s largest telecommunication providers, and Yealink will equip startups at @Main Street and @American Tobacco with complimentary phone systems.

“Bandwidth and Yealink believe in the revolutionary power of startups,” says Bandwidth marketing chief Noreen Allen. “As they grow and succeed, we want to be right there supporting them.”

Growing Ecosystem Earns Broad Community Support

Duke’s Innovation and Entrepreneurship Initiative is another key supporter. The program seeks to coordinate and enhance the university’s capabilities in education, research and translation to enable both commercial and social entrepreneurship.

“American Underground will help us reach an important goal  — connecting Duke with the vibrant community of entrepreneurs in Durham,” said Eric Toone, the new director of the university’s Initiative.

Self-Help Vice President Tucker Bartlett noted, “The Underground @Main Street fits well with our 30-year mission of fostering small businesses, and empowering communities to provide broader opportunities for everyone. The redeveloped City Center building has been key in helping revitalize downtown Durham, and we look forward to the birth and growth of more successful ventures here.”

@Main Street’s roster of startups already includes Sqord, Archive Social, StartupSpot, Pluribus Systems, Green Plus, Synchear, Impulsonic, Mint Market, SalesTags, Privateer Digital Media, SongBacker, Thryv, iKlaro, HaitiHub, and PlusDelta Technologies.

Interested companies should visit www.americanunderground.com to apply for space @Main Street.

Resources:

American Underground infograpic

Video about the Durham entrepreneurial ecosystem

A list of Durham-based startups with Web addresses

Epic Hack Day: an open to all code fest in the NC Triangle

Thursday, September 6th, 2012

By Joe Procopio

Joe Procopio

Joe Procopio

What do you get when you put 100 geeks in a room with computers and tell them to create whatever they want? I’d go with a Weird Science reference, but today’s geek hadn’t been born when that movie hit the theaters.

Durham startups Adzerk and Shoeboxed have joined forces with the American Underground startup hub and the Durham Chamber of Commerce to put on Epic Hack Day, a full day of no-rules creative coding with no stated goal other than to build something cool.

It’s Saturday, September 8th in the American Underground, and will run from 10:00 a.m. until early the next morning. All the essential fuel will be provided, including beer from local startup-friendly brewery Fullsteam.

This Needs to Happen

The lead organizer is Adzerk founder and CEO James Avery, who has been an entrepreneur-fixture in the booming Durham startup ecosystem over the last few years. Participating in almost every value-add event in the Triangle (and some non-value-add, I mean, the guy has a life) from Tech Jobs Under the Big Top to Southern Capitol Venture’s eSeries, Avery decided this event needed to happen, and quickly put the foundation together.

The concept of the company Hackathon is not new. You’ll find it everywhere from local startups — Automated Insights and Shoeboxed were two that got some mention — to Fortune 500 corporations looking to gain a technical and creative edge by letting their employees improvise and innovate and then rewarding the best concept.

But this is a first for the Triangle. Epic Hack Day is not limited to a single entity like a company hackathon, it’s not centralized around a specific language like a user-group hackathon, nor is the ultimate goal to create a viable company like a Startup Weekend.

“The idea is simple,” says Avery. “Let’s get 100 coders and designers together for 12 hours of work on fun and interesting projects. Think of it like a Startup Weekend but without any of the structure or pressure to ‘create a company.’”

All of the Tech, Twice the Fun

I know Avery, and I know he likes to push the edges of a concept enough to make it fun. At the aforementioned Tech Jobs under the Big Top, his recruiting video was the only other one I considered funnier that our own, and at the second version, he went with a straightforward approach that combined technology with showmanship.

He also delivered one of the best lines of advice at eSeries when he told an entrepreneur who had been banging her head against the wall trying to find affordable tech talent to get online and learn enough code to get through her prototype.

He knows why it’s fun to be a startup employee, why it’s cool to be a coder, and why it’s important to embrace technology beyond the standard development lifecycle.

For Coders By Coders

Shoeboxed is also a player in the startup ecosystem, contributing to and being a part of several of the local community-building events. Their last hackathon was a multi-company affair, and they plan on staging another in the not-too-distant future.

Make no mistake, though, this is technology-based. Everyone will be there to get their hands dirty – well, as dirty as you can get on a keyboard. There will be snacks, so there you go.

If this sounds like your kind of thing and you have Saturday free, you can register for Epic Hack Day here.  I’ll be super curious to see what comes out of this, how it can be used, and who will run with it.

Joe Procopio (@jproco) heads up product engineering for automated content startup Automated Insights, which is also StatSheet. He also founded and runs startup network ExitEvent,. You can read him at http://joeprocopio.com.

 

Need tech talent? Hacker Tour connecting startups and students

Friday, August 24th, 2012

hacker tour busIt can be tough for tech start-ups to recruit engineering and science students for internships and jobs without brand recognition. The Readyforce Hacker Tour 2012 is intended to help remedy that via an eight-week national bus tour designed to connect students and startups.

The Hacker Tour includes campus career fairs, CEO/CTO speakers, meetups, coding competitions and “maybe a party or two.”

It will stop at schools across the country, many in tech hubs from the San Francisco Bay Area to The Research Triangle, NC. It will visit Virginia, Ohio, and Pennsylvania. Other stops include Boston, Austin, and San Diego.

Stops on the Hacker 2012 Tour:

hackerforce tour map

Companies invited to sign-up

Readyforce invites companies interested in joining Hacker Tour 2012 to learn more and register at: www.hackertour2012.com.

Sponsors include early stage companies like Red Owl Analytics, Codeacademy and Quixey and later stage organizations like Etsy and Sonos.

It seems to be helping start-ups looking for talent.

“Partnering with ReadyForce on the Hacker Tour will expose ZestFinance to thousands more students across a much more diverse set of universities than we would be able to accomplish on our own,”  says Adam Redlich, Head of Talent Acquisition at ZestFinance.

“At Elance, we create opportunities for students to work for themselves while they build an online portfolio that gives them an edge in the competitive job market,” said Rich Pearson, Chief Marketing Officer, Elance. “We are excited to be a part of the inaugural Hacker Tour because it is a unique way to tell students about a unique job opportunity.”

“At SoundCloud, we are always looking to hear from talented and motivated individuals across all disciplines, so sponsoring Readyforce’s Hacker Tour represents a natural fit for us,” said Eric Wahlforss, CTO and co-founder, SoundCloud.

 Colleges like the program

Colleges and universities are also enthusiastic.

Corbett Morgan,  startup analyst at the Technology Commercialization & Knowledge Transfer Office, The Ohio State University, says,  “Readyforce is the progressive, soon to be widely adopted, method for students to interface with startups; the Readyforce Hacker Tour makes this opportunity tangible.”

He adds, “Telling a talented student, ‘Startups want you and your skills. They are coming to you and they want to meet YOU,’ is a powerful message and undoubtedly bridges the disconnect inherent in the outdated apply-online recruitment method.”

 

iContact sale to Vocus is Updata’s third exit in 90 days

Monday, March 5th, 2012

Updata PartnersUpdata Partners, a leading technology-focused growth equity firm, says the sale of portfolio company iContact to Vocus for $169 million marks Updata’s third portfolio exit in three months, following the sales of Jobs2Web to SuccessFactors in December for $110 million and Numara Software to BMC in January for $300 million.

The sale represents a 2.7x return on invested capital and a 31% IRR for Updata.“Updata’s contribution was instrumental in iContact’s rapid growth and successful exit. Their strong operational experience and deep understanding of the software-as-a-service model catalyzed our breakout performance.”

In a recent interview, a Novak Biddle venture capitalist told the TechJournal that many large firms are flush with cash and he expects to see increased merger and acquisition activity as firms use M&A to grow. That’s good for the entire entrepreneurial ecosystem.

Updata first invested in iContact in 2007

Carter Griffin, general partner at Updata Partners and iContact Board member said, “The outcome is the culmination of a lot of hard work by Ryan Allis and his team and the positive dynamics of their market. The transaction also serves to reinforce Updata’s strategy of backing high growth technology companies.”

iContactResearch Triangle, NC-based iContact provides email marketing and social media marketing software-as-a-service to small and medium businesses. Updata initially invested in iContact in 2007, providing the first institutional capital.

Since the investment, iContact has grown rapidly and is now the largest privately-held provider of SMB email marketing software. The combination of iContact and Vocus creates the clear leader in cross channel integrated marketing software.

iContact Chief Executive Officer, Ryan Allis, commented, “Updata’s contribution was instrumental in iContact’s rapid growth and successful exit. Their strong operational experience and deep understanding of the software-as-a-service model catalyzed our breakout performance.”

Allis himself has been a strong advocate of “social entrepreneurship” and giving back to the community. He has authored a book about how he made his dream of creating a million dollar company come true — and has exceeded that dream.

For more information, please visit www.updatapartners.com.

In the RTP: Why Aren’t You an Entrepreneur?

Friday, January 27th, 2012

By Joe Procopio

Joe Procopio

Joe Procopio

In my last installment of this 2011 review of the RTP startup ecosystem, I went back over some of the companies I hung out with last year. Some. Just a few. Mostly the ones who did big, huge, extraordinary things. But of course that leaves out the hundreds (and yes, there are hundreds) of equally likeable and viable companies who did not do big, huge, extraordinary things last year.

I hung out with them too, just in groups and a lot of times with drinks.

And there were groups everywhere.  If 2011 was the year the RTP startup ecosystem organized, it got most of that organization done at meetups, events, users groups, conferences, and galas. If it seemed like there was something startup-related going on every single week that’s because there was, and 2012 looks to be no different, just better.

There’s been no better time to be an entrepreneur in the RTP. Here’s why:

Foot on the Accelerator

2011 started off and ended with announcements from two completely different accelerators.

American Underground

Artist's rendering of the American Underground space

LaunchBox Digital graduated its first class to come out of Durham in January 2011, with a big event at Bay 7 at American Tobacco (http://www.techjournal.org/2011/01/90-days-work-in-eight-minutes-launchbox-digital-2010-demo-day/) (where it’s falsely rumored that I keep a secret sleeping quarters – I actually just sleep in Square 1 Bank’s conference room… don’t tell them).  Seven companies held court for eight minutes apiece in front of brave ice-conquering crowd of hundreds.

Then in November, rumor turned into reality when Capitol Broadcasting and NC IDEA announced that new accelerator Groundwork Labs would be taking applications, well, now (http://www.techjournal.org/2011/11/new-startup-accelerator-groundwork-labs-launching-in-durham/).

Groundwork will be run by John Austin, and if that name sounds familiar, it’s because he’s also running Joystick Labs, the gaming accelerator (http://www.techjournal.org/2011/04/gaming-for-everyone-john-austin-joystick-labs-the-east-coast-game-conference/). They held their first successful session in the summer of 2011, and will be ramping up again in 2012.

And it should be noted that while LaunchBox closed up shop in 2011, out of the ashes rose the homegrown Triangle Startup Factory (http://www.techjournal.org/2012/01/return-of-the-triangle-startup-factory-and-why-its-huge-for-the-rtp/). Also taking applications. Also now.

That means there are three “new” programs in the RTP for aspiring entrepreneurs to get their product from concept to reality with more help than should be legal. If you don’t apply to at least one of them, you have no one to blame.

Out of the Garage

Beyond the proliferation of accelerators in the area (and honestly, how often do you get to read a sentence like that), there were literally dozens of events in 2011 that highlighted, supported, or celebrated startups. And if you know me, you know I’m all about the grass roots.

In March, I wrote about Startup Madness, the second in a series of homegrown events from Scott Kelly that announce and market the launch of local tech startups (http://www.techjournal.org/2011/03/startup-madness-it%E2%80%99s-not-as-crazy-as-you-might-think/).  Kelly just held another Launch Days very early this year, and has two startup events on the calendar for Spring and Summer that focus on high school and college entrepreneurs.

In June, Triangle Startup Weekend (http://www.techjournal.org/2011/06/try-before-you-buy-triangle-startup-weekend/) made a welcome return to the area with over 100 entrepreneurs spending three straight, sleepless days and nights building a company from scratch. TSW makes a repeat engagement in April this year, and will be very interesting as some of those folks ran with their companies and likely still haven’t slept.

Not to be outdone, the gamers put on their own party, Raleigh Game On (http://www.techjournal.org/2011/08/game-on-rtp-indie-game-companies-take-matters-into-their-own-hands/) packed 150 game developers and gaming enthusiasts into the Hive in downtown Raleigh in August. I, for one, have always felt like the gamers should and could be more visible in the RTP startup ecosystem. Between Joystick, Game On, and other recurring events like the TGI Social, 2011 was a big step in the right direction.

Even if you didn’t have a startup or even an idea in 2011, Tech Jobs Under the Big Top (http://www.techjournal.org/2011/05/tech-jobs-under-the-big-top-hot-dogs-beer-jugglers-jobs/) provided a real opportunity for getting in on the ground floor of a startup just by going to work for one.

And let’s just pretend I already talked about ExitEvent.

Oh, Yeah, There are VCs Too

I’ve always been amazed at how accessible the local VCs are and how few startups and wanna-be startups take advantage of that accessibility. Here are two ends of the spectrum I talked about in 2011.

Jason Caplain

Jason Caplain

Jason Caplain from Southern Capitol Ventures is involved with a lot of events, meetings, get-togethers, and so on, probably more so than any single local investor.

In January, we sat down and talked about one of the more intriguing (at least to me) things he does. Once a month (maybe every other month when he’s busy), Jason hosts breakfast for any entrepreneur who wants to get or give advice (http://www.techjournal.org/2011/01/jason-caplain-builds-better-entrepreneurs-over-bagels/).

But maybe one-on-one isn’t your thing.

In April, I wrote about the, get this, 28th annual CED Venture Conference (http://www.techjournal.org/2011/04/ced-venture-2011-mission-accomplished-now-what/), where for a small price (in terms of value), you can catch up with a keg of VCs, angels, and dozens of funded and unfunded startups. Watching and learning from the public pitches alone is worth the price of admission.

And by the way, that was on the heels of the SouthEast Venture Conference and the East Coast Game Conference, both of which are coming up again in 2012.

If anything, 2012 is going to build on this strong support structure that sprung up in 2011. So if you ever, ever thought about ditching it all and starting a company, well, my friend, this is your year. Apply, attend, meet-up, discuss, engage and party. Of course, there’s all that hard work and risk, but at least you’ll have hundreds of others slogging it out with you.

Joe Procopio heads up product engineering for automated content startup Automated Insights. He also founded and runs startup network ExitEvent, consulting marketplace Intrepid Company, and the Intrepid Media writers network (http://IntrepidMedia.com). You can read him athttp://joeprocopio.com and follow him at http://twitter.com/jproco.

 

2012: The Year the RTP Startup Ecosystem Explodes

Friday, January 6th, 2012

By Joe Procopio

Joe Procopio

Joe Procopio

I’ll start off 2012 with two disclaimers.

One: Apologies to you Mayan calendar believers, I didn’t mean to alarm you with the title. 2012 won’t be the year that random Durham entrepreneurs spontaneously combust – although that could happen, it’s highly unlikely. I’ll make it up to you by not making an easy joke at your expense.

Two: I’ll be honest with you. I don’t know what’s going to happen to the RTP Startup Ecosystem this year. I’ve seen some crazy stuff in my time here. For all I know, Durham could become the food truck capital of the world, pushing technology, bio, and gaming aside, and prompting food truck tourism and a Food Truck Alley along Jackie Robinson drive.

For all I know.

But I can tell you this. What happens in the oh-twelve is going to build off of what happened in 2011. And if you have to put a single word on what the RTP did to justify its position in the startup universe relative to Silicon Valley, New York, Boulder, etc., that word would be: Organization.

Note that it’s not: Money. That’s what 2012 needs to be about.

In 2011, the RTP startup ecosystem finally took it upon itself to connect its various garages, coffee shops, and secret evil lairs in an effort to combine strengths, learn from one another, and sort out who is who and who is working on what. It was 99% a grass roots effort, which is good, in that it was very inclusive, but not so good, in the sense that the movement is still pretty underpowered. All in all, it was a measurable jump-start, but there’s a lot left to do.

So let’s take a look back over the year that was and make some assumptions about the year that is.

Hey! I’ve got an idea! Let’s do this via a collection of 2011 highlights from my column.

At least it’s not a top 10 list. Happy New Year.

Doing It Right

Several RTP companies landed major funding in 2011. Having walked that walk as part of the management team of Automated Insights/StatSheet (another disclosure), I can tell you that raising money last year wasn’t easy. But that also means that the companies that did receive funds are solid.

In Rabid Wolverines: Why Argyle Social is the Test Case for Durham 2.0, I talked about the aggressive, confident approach of Argyle and Eric Boggs, a refreshing attitude as Durham 2.0 started to spring up.

The Underground Got Relevant

Then in July, I sat down with James Avery and came out the other side with Adzerk’s No-BS Approach Results in $650K. Adzerk was proving the Durham startup thesis, founded by pivoting an existing business in RTP, moving into American Underground, taking advantage of the support groups springing up throughout the area, and ultimately running the gauntlet of both local and national VC raises. Successfully, as it turned out.

Launch Party? How About Launch Festival

Later that same month, I told you about a product launch that turned into an old-school dot-com style party in Bringing Sexy Back: Why deja Fest Is More Than a Launch Party. deja mi’s founder Justin Miller organized (there’s that word again) a two-day, 26-band event to prove out his venue-based media sharing application before it got the live customer treatment at the Hopscotch Festival in September.

All Work and No Play

By the way, those three companies were in attendance, along with about a dozen others, at Pongageddon: The RTP Startup Ecosystem Goes Rogue in March, a day of pizza, beer, and local startups competing for a ping-pong trophy hosted by StatSheet. This was one of the first formal get-togethers of some of the local entrepreneurs, but it would definitely not be the last.

The Graduating Class

But 2011 wasn’t just about the established and funded. In December, I got the chance to judge a UNC-hosted startup event and wrote about Ten Promising Rookie Startups from the Carolina Challenge. This included $1000 winner (and established though not funded) YardSprout and 47 other startups, most of whom I had not heard of before that night but will keep an eye on this year.

So yeah, that was 2011, but that was just the stuff I wrote about startups, and those few companies I got to are just the tip of the iceberg that is the 200+ tech startups in RTP. In a future installment, I’ll reminisce about the explosion of support organizations and how even those organizations got more organized.

Joe Procopio heads up product engineering for automated content startup Automated Insights. He also founded and runs startup network ExitEvent, consulting marketplace Intrepid Company, and the Intrepid Media writers network (http://IntrepidMedia.com). You can read him at http://joeprocopio.com and follow him at http://twitter.com/jproco.

New startup accelerator Groundwork Labs launching in Durham

Tuesday, November 15th, 2011
Joe Procopio

Joe Procopio

By Joe Procopio

It’s always good to get a second chance.

Ask anyone involved in the startup game and they’ll tell you: Part of the makeup of a great entrepreneur is the ability to deal with failure. This ability usually comes, oddly enough, with actually having failed, at least once, on the way to success. It’s a conundrum of the game.

The North Carolina Research Triangle had an accelerator, very recently, and it was successful, and it closed up shop, which caused a lot of disappointment and heartbreak within the startup community. But it’s important to note that while Groundwork Labs will fill the void left by Launchbox in the American Underground in Durham, it’s not a replacement.

It’s something new, with new players, a new mission, and a new vision.

And the fact that the RTP gets another shot with the acceleration concept, that’s, well, lucky, to say the least.

How It Works

Groundwork Labs, much like your traditional accelerator, will select promising startups for a three month session and load them up with the standard foundational elements: space, advice, connections, mentoring, and the all-important $20,000 in walking around money.

They’re starting quickly out of the gate, Spring 2012, which means you should get your application in yesterday. They expect to work with between five and seven startups per session and run at least one and hopefully two sessions per year.

I actually got wind of the Groundwork Labs news about a week ago, but I had been sworn to secrecy. I’m not sure why they were so worried. I’m not that kind of journalist. I’m the other kind. The lazy kind.

Official word broke yesterday afternoon, which happened to be just hours before the monthly ExitEvent social I host for area entrepreneurs, which happened to coincide with the TechJournal Deck Party, in Raleigh, which happened to fall on the eve of Internet Summit 2011 at the Raleigh Convention Center, resulting in a Catalina Wine Mixer of startup tech marketing investor type people in one place. So I had access to a lot of opinion. Others I got to via emails. Disclaimer: There was no free beer involved in the solicitation of opinion.

And overall the opinion is very, very hopeful.

What Do You Think?

“Love it,” says iContact’s Aaron Houghton, “Durham deserves it and many passionate entrepreneurs will benefit from it.”

“Launchbox proved that having a local incubator is important to the entrepreneurial ecosystem,” says Robbie Allen, CEO of Automated Insights. “It really helps raise the profile of all startups in the area.”

James Avery, founder of Adzerk and a very passionate voice when Launchbox closed up shop is, well, excited again. “I am thrilled to see that Durham will once again host an accelerator. I love that John Austin is involved as I think he has done a great job with Joystick so far.”

John Who?

John Austin, Director of Joystick Labs, will also head the Groundwork effort. Before any of the gamers freak out, nothing is going to happen to Joystick. It will continue to operate independently, though it does get a boost in efficiency of shared resources. Joystick will get its next semester underway this summer, and the two efforts will continue to operate in leapfrog fashion.

I got a chance to sit down with John again yesterday. We hadn’t really caught up since he took the helm of Joystick right before this year’s East Coast Game Conference.

The two players in Groundwork Labs, Capitol Broadcasting  and NC IDEA  are very excited about it, according to Austin. There will be synergy between the entities with resources obviously coming from the Underground, as well as the possibility that some of the startups chosen for Groundwork will come from NC IDEA – even though there will be separation in the process, with two separate application programs, etc.

NC IDEA, the grant program that has a symbiotic relationship with VC firm Idea Fund Partners, and another organization I got to dig down into recently, is another positive. Beyond being the region’s best kept secret for early stage entrepreneurs, they’re entire mission is to aid the area in terms of building up a successful, thriving, early-stage ecosystem.

“I think this is an important piece of the puzzle for building a stronger entrepreneurial ecosystem in North Carolina,” says Lister Delgado, Founder and General Partner at Idea Fund Partners.

“It is another way to help attract entrepreneurial talent to the state, and to keep the resident talent here. Besides the money and the assistance that an accelerator can provide to the entrepreneurs participating, an accelerator is a great marketing tool for the community. That is why we are excited to be involved.”

Two Types of Investment

Austin backs this up, and notes that NC IDEA and Capitol Broadcasting, who owns and operates the American Tobacco Campus, have split the infrastructure costs from the investment in the companies. This model is much like how Joystick operates. The investors see the investment in the infrastructure of Joystick as an investment in the entrepreneurial community. Not a donation, per se, but with an expectation for a different kind of return.

This is the critical factor in the potential success of Groundwork. Capitol Broadcasting has a business interest in seeing it succeed, through the American Underground and several other initiatives they have operating in the startup ecosystem. As for NC IDEA, early-stage success here is what their mission is built upon. Groundwork is almost like an expansion of their program, a runway off of the grant money, or even just the runway when the money isn’t a critical factor.

This vested interest, skin in the game, if you will, from the funding parties, is designed to give Groundwork enough time to decide whether or not the accelerator will work. That, of course, is up to the companies selected, and in some sense the rest of here in the area already hard at work at making the region stick as an entrepreneurial hub.

So in that sense, Groundwork Labs is another good sign. Second chances are hard to come by, so you’ve got to jump on the opportunity when they do.

Zack Mansfield, VP at Square 1 Bank and manager of their startup assistance program Square Roots, sums it up nicely. “It’s exciting to see a new accelerator for a lot of reasons but the most significant is that if this region is serious about becoming a top hub for startups, we need more of just about everything – more capital, more entrepreneurs, and more people in the ecosystem supporting new ventures to help them grow.”

Joe Procopio heads up product engineering for tech media startup Automated Insights (formerly StatSheet). He also owns consulting firm Intrepid Company  and creative network Intrepid Media and runs the startup social ExitEvent. Joe can be reached via Twitter @jprocoand read at joeprocopio.com.

 

Tech jobs under the Big Top 2: running away with the startup circus

Monday, October 17th, 2011

By Joe Procopio

Joe Procopio

Joe Procopio

Did you read the piece I wrote back in May about Tech Jobs Under the Big Top?  Click on it so I get the credit and I’ll boil it down for you here.

  1. The brainchild of former Launchbox Executive Director Chris Heivly, Big Top purported to create a job fair strictly for startups and, in doing so, turn the concept of a job fair completely on its head.
  2. Underwear joke.
  3. It succeeded, and the event drew 15 companies pitching over 85 jobs to over 250 job-seekers in an atmosphere that resembled an actual circus, down to the clowns, jugglers, and free peanuts and cotton candy.

No wait, I know I just blew your mind, so you might have missed where I said 15 companies pitched 250+ job seekers — not screened, but pitched – with each company giving a three-minute presentation on why their startup was the place you wanted to work.

We’re Changing the World Plus We Have a Ping Pong Table

I loved that concept. A lot. I was there with one of the companies doing the pitching. So I sat down with Heivly as he was gearing up for Big Top 2.0, which is taking place Thursday, October 20th at Bay 7 in the American Tobacco Campus. You can find out more at BigTop.IT or just go register at: bigtop.eventbrite.com.

If you’re looking for a job and/or have ever thought about working for a startup, there is no better way to amplify your job search. Even if you’re gainfully employed, as about half of the job-seekers at Big Top are, you may want to drop by (although if you’re unprepared to be swayed by the magic and the majesty and the long hours and the low pay of Startup Nation, save the ticket for someone who needs it).

In my own view, the concept was a smash hit for a lot of reasons. As I pointed out in my last column, the Big Top event succeeded at removing the stigma of unemployment by turning the tables and having the potential employers sell themselves. Finding a job is hard enough. Finding a job at a job fair is like getting a root canal. Finding a job at a job fair during a recession is like getting a root canal from someone who works in Human Resources.

This is why Heivly had us pitch the job seekers, and I can tell you firsthand that each company got on board and produced presentations that ranged from gut-bustingly funny to eye-opening inspirational. You couldn’t help but have a smile on your face by the second or third pitch.

Do You Have Any Idea Who I Am?

BitTop event

The Big Top jobs event

But this is not the kind of endeavor you undertake a second time just because you made people feel better. Believe me, if I had a nickel for every time something I wrote made someone laugh, I’d make even less money writing than I do now.

You’re welcome.

One thing Heivly pointed out that I wouldn’t have put together is that Big Top and the resultant hype also dropped the names and identities of many local, working, hiring startups into the lexicon of 250 potential employees.

A lot of feedback from the first event centered around the fact that the job seekers just didn’t know there were this many of this kind of company in the area. You may not think this possible, I sure didn’t, but those of us who are immersed in the ecosystem, especially those of us shouting from the rooftops about how awesome this ecosystem is, can easily forget that the vast number of people out there have never heard of any of us.

But most importantly, Big Top succeeded as a job fair, resulting in a vast amount of connections, many useful relationships, and of course, several filled positions.

So What’s New?

Here we are just under half-a-year later and the outlook really hasn’t changed all that much. The silver lining on the cloud is that there are still at least a dozen smart, passionate startups who need smart, passionate technologists.

This time around, Heivly tells me, there will be more focus on the networking. One easy solution is that there are three fewer companies, so they still get the three minute pitch, but it won’t take as much time.

Heivly is also sending out an email to all registrants with all 60+ jobs that the startups need filling, so both sides can get right to the point.

In an additional effort to make the discussions more efficient, Big Top 2.0 will feature 12 tables, one for each company, instead of three tables, one for each discipline (technology, marketing, general business).

You Have To Be Crazy To Work Here

Overall, Heivly admits he’s done a little better job talking about the companies. Correspondence with the registered job-seekers is about making sure that the right people are there – because these are early-stage tech companies, and the jobs are more than 50 percent software development.

Last time, he says, about 20 percent of the crowd realized they didn’t belong there. Why? They just weren’t the special kind of crazy you need to be to work at a startup. Again, it’s high risk, long hours, low pay, and so glamorous that the vast majority of people out there will never have heard of you.

But it’s the other 80 percent that the startups need to reach. As Heivly jokes, and I agree, every developer we get from IBM is a win for the ecosystem.

One thing that won’t change, thankfully and rightly so, is the tone. There will still be jugglers and acrobats and the tent and the straw and the free beer and carnival snacks. All of this lends to a very comfortable networking environment.

At some point, Heivly wants to see this expand out of software and into life science and other startup disciplines. I told him I think gaming would be huge, and he agreed. But regardless of whether we’re talking about a BigTop 3.0 for web, mobile, biotech, gaming, clean & green, or craft brewing, as long as we’re talking about the RTP startup ecosystem, we’ll reach more people who have never heard of companies like Adzerk, EvoApp, Shoeboxed, HEALTHeME, ReverbNation, Argyle Social, and so on.

Mort importantly however, the more those companies keep finding smart, passionate technologists (like you), the less we’ll need to talk about it, because it will speak for itself.

Joe Procopio heads up product engineering for tech media startup Automated Insights (formerly StatSheet). He also owns consulting firm Intrepid Company and creative network Intrepid Media and runs the startup social ExitEvent. Joe can be reached via Twitter @jproco and read at joeprocopio.com.

 

U.S. business journalists confident their local economies will improve (video)

Thursday, August 11th, 2011

NCBJU.S. business journalists — who keep their fingers on the economic pulse of their local communities — said they expected business conditions in their areas to improve in the next six months, according to a new survey commissioned by the Donald W. Reynolds National Center for Business Journalism.

In a phone survey of 300 business journalists conducted nationwide in mid-July, many described their local economies as suffering:

  • One in three said business conditions were bad.
  • Four out of 10 said jobs were hard to get.

But most expressed optimism that their local economies would improve, with only 6 percent saying they expected things to worsen in six months.

When asked about their local housing market, one in four said the residential real estate market was better now than six months ago. Only one in 10 thought it would be worse in six months.

Conditions were toughest in the West, where half the business journalists said their local economies were bad and jobs were hard to get.

In Atlanta, too, Rachel Tobin, commercial real estate reporter for the Atlanta Journal Constitution was not so optimistic. She said:

“In Atlanta, our economy really isn’t improving, and signs only point to things getting worse:

  • Unemployment ticked up again to 10.5 percent in June – which is above the national average.
  • Housing prices dropped again. (We have now lost about 13 years of equity in our homes.)
  • The commercial real estate vacancy rate rose again, to 17.2 percent, according to CoStar Group.
  • Very few jobs are being created. When few jobs are created, that means there’s less demand for office space and homes.

“To be sure, Atlanta’s economy is diverse – it still has many Fortune 1,000 headquarters, from Home Depot and UPS to Coca-Cola and SunTrust Bank. The hope is that once the economy begins growing again, Atlanta will reap the benefits. But that time can’t come soon enough for the unemployed workers here.”

In Seattle, economics columnist Jon Talton of The Seattle Times said business conditions are mixed. “Apartment construction is rebounding: I can see four cranes out my window for high-rises now,” he said, but “many small businesses continue to struggle with weak consumer spending and tight credit.”

Pamela Yip, personal finance writer for The Dallas Morning News, agreed on the mixed picture. “Dallas-Fort Worth added more jobs than any other U.S. metro area during the six months ending in June,” she said. “But…unemployment is 3.6 percentage points higher than it was three years ago.”

In North Carolina, major technology companies such as IBM, among others, have shed thousands of jobs, state budget problems will result in cuts in state employment and education, and the state’s unemployment rate remains higher than the national average at nearly 10 percent (9.9 percent in June 2011). Things are a bit better in the Research Triangle. Unemployment in Durham and Wake Counties where the educational level is particularly high, is at 8.3 percent.

Personally, I’ve been covering business for a variety of publications since the 1980s – including two business journals and three online technology news sites, including the TechJournal. While there are upsides to the U.S. economy that may be under-reported, the recent debt ceiling debacle, stock market volatility, and the continuing reluctance of financial institutions to lend small businesses money, make recovery look like a long, slow process.

On the other hand, the U.S. economy has often shown surprising powers of recovery. What do you think? Let us know in the comments. Is this economy poised to get better or will it be treading water for an extended period?

The full survey report includes an interactive map and an additional video.

ABOUT THE SURVEY
Business Journalists Study 2011 (PDF) was conducted by the Behavior Research Center Inc., using questions similar to those for The Conference Board Consumer Confidence Survey.

The phone survey conducted July 18-21 has a margin of error of +/- 5 percent. Neither Talton nor Yip were among the 300 randomly selected business journalists surveyed, who came from print, online, broadcast, wire services and freelancing.

–Allan Maurer

“Analysis of Business Journalists Survey on their Local Economies 2011” from Reynolds Center on Vimeo.

Are we in a tech bubble? Four RTP entrepreneurs reflect national difference of opinion

Thursday, July 28th, 2011
American Underground

Artist's rendering of the American Underground space

RESEARCH TRIANGLE, NC – As new media companies roll out billion-dollar IPOs, four CEOs from the American Underground, an RTP startup hub, weigh in on whether the enthusiasm is on target or out of control.  Their differing opinions reflect the national debate. Some say yes, some say no.

Jason Massey, Sustainable Industrial Solutions:
“We are ABSOLUTELY in a new tech bubble!  Anyone that tells you different is financially benefiting from it or was not around for the last Internet bubble.

“Having been in venture capital through the last boom and bust the signs are almost identical from the last bubble.  While the funding vehicles are a little different, you still see ‘late stage’ investors clamoring to get into hot deals.

“But instead of trying to get into a rush of IPOs, investors are buying shares through secondary markets.  In the last bubble you had undergraduates running incubators.  Today, you see some undergrads doing venture capital work.

“It is not all bad.  As with the last bubble you had significant innovation survive the nuclear winter.  You will see the same in this bubble.  There will be innovation that improves quality of life.  Whether that is something like Zynga’s Farmville or Twitter it may still be a bit early to see who survives this shakeout but you are seeing the positive affects of Twitter and social networks in events like the Arab Spring.

“And while this crop of hyped companies do have impressive revenues and some profits, one thing is for certain, as second and third tier companies make their way through IPO markets and disappoint with collapsing numbers, you will see the secondary market implode, valuations will reset and lots of unsophisticated investors will lose money.  And the SEC will have failed us again.”

Keval Mehta, Jaargon Ltd:
“I don’t think that America is looking at a new ‘tech bubble.’  Tech is becoming part of our daily lives and affecting every single industry.  Tech is now more than just ‘web sites’ as it was in the last tech bubble.  Anyone with an idea, either good or bad, got funding.  Investors, entrepeneurs, and the general public are now more aware of what’s a good idea and how it can affect them in their day to day lives.

“This rationale alone will prevent another tech bubble.  Zygna in gaming and Groupon in commerce are single-handedly disrupting their individual industries with their products, and their valuation and sending a ripple affect in the tech industry.

“Their affect and valuation are allowing investors who are sitting on a lot of cash that they were unwilling to spend in the recession to now start seeking investments.  It may be starting another gold rush.  In our company we feel there is a huge void in healthcare technology.  It is one of the most untapped markets when it comes to consumer tech and healthcare.  We hope to fill in that gap with products and services that allow users to use tech to manage their healthcare.”

James Avery, Adzerk:
“The companies going public today have significant revenue and growth – something that didn’t exist in the last bubble.  Zynga is bringing in around $1 billion a year in revenue. Groupon brought in $645 million in the first quarter of 2011 (although they still lost money). Even Pandora, which went public recently, is close to hitting $100 million a year in revenue.

“We will know we have hit a bubble when the companies getting huge valuations aren’t generating meaningful revenue.  When you look back at the big busts in 2000, WebVan went public at a $6 billion valuation and they had under $4 million in revenue ALL TIME before their IPO. Pets.com revenue only hit $5 million in the quarter before they went public. People started claiming it was a bubble when Google went public at such a high valuation – but I think with a time machine any one of us would go back and buy their stock at the IPO price.”

Nick Jordan, Smashing Boxes:
“In short, I believe we have a flawed system.  on the one hand, you have companies like Amazon and Google, where the majority of their current market value was created after their IPOs.  That means that the founders and investors who took all of the risk made less off the entire deal than your everyday stock investor or mutual fund.

“On the other hand, with these hyper inflated valuations, you have a lot of VCs who need to make a certain return on their investment, so they pump up prospectuses and pass off the risk to these same mutual funds and average Joe investors.  Neither is ideal.”

One thing we have heard repeatedly at Tech Media digital conferences is that while there may be valuation boom for Internet firms on the West Coast, that is not true in the Northeast or Southeast.

See also: Infographic: Tech boom or bubble? You decide

Bill would require wireless carriers to define 4G, Verizon launching 4G in RTP

Thursday, June 23rd, 2011
smartphones

Millennials are the most connected generation and use mobile for shopping, going online and more.

Just what the heck is 4G anyway? Verizon’s Karen Shultz, visiting the NC Research Triangle to tout the July launch of its 4G service in the region, says, “4G just means its a fourth generation system and every carrier is using a different technology.”

Verizon’s, slated to go live in the Research Triangle July 21, is ten times faster than its 3G system. At between 5mb to 12mb a second, “It’s the difference between a kitchen faucet and a fire hose,” Shultz says. “You’ll be able to download books and songs in seconds and movies in minutes. A lot of the things that drive you crazy working in the field on 3G will be no trouble on Verizon’s 4G. It will be comparable to working on a home computer.”

Verizon is also putting an extra 58 towers operating at the lower end of the spectrum, which provides a wider service area, to support the new 4G service in the Triangle area. The new towers expand the coverage area by 40 percent.

We recently tested phones with service by Verizon, Sprint, and AT&T, and while all performed adequately, Verizon’s service was consistently the best, particularly indoors, on the train between Durham, NC and Charlotte, NC, and even in more outlying areas. The 3G service, however, felt like a return to the early computer use, as mobile web pages took their time to load or change pages. The idea of actually working on one of those phones at more than communication was daunting.

Time Warner Cable, Sprint and Clear also offer 4G services in the Triangle. But that doesn’t mean they’re all the same.

That’s why Rep. Anna Eshoo, (D-CA) introduced a bill June 22 that would require providers to disclose actual data speeds at point of purchase. Called the “Next Generation Disclosure Act,” the bill would require the FCC to provide the speed information.

The International Telecommunications Union defines 4G as a 1 gigabit/sec and as yet, none of the major carriers achieve that speed. The ITU allows carriers to use the term 4G to describe “evolved 3G technologies providing a substantial level of improvement. in performance and capabilities.”

Shultz says there is is more to the increased speeds to the 4G service Verizon offers.

“Down the road, as the LTE service kicks into gear, we’ll see increasing machine to machine connections. Those connect consumers to power provider smart grids for better control of energy consumption, or even to a refrigerator for inventory control, and other “humanless connections” leading to that everything connected world we’ve heard so much about in futuristic forecasts.

Here’s Verizon’s 4G speed comparison chart:

4G speed chart

InfusedCommerce makes it easy to create a Facebook store

Wednesday, June 8th, 2011

InfusedCommerceBy Allan Maurer

CARY, NC – When Michael Bender and his InfusedCommerce co-founders created a technology that will embed a buy option directly into an online ad, it didn’t take long to figure out where to start offering it to customers. “We realized you could embed this technology anywhere, but the people we talked to wanted it on Facebook,” he says.

Michael Bender

Michael Bender

Bender, president, Brian Cary, lead developer, and Arthur Tew, business development manager, started InfusedCommerce in March 2010 and it is now one of the first companies in the Cary TechStarts+ accelerator.

“We started getting value from TechStarts Plus immediately,” Bender tells us. “There is a big advantage to being surrounded by tech people and startup people who have been there before. Even the water cooler talk is more interesting and applicable.”

In addition, the company gets advice from TechStarts+ head honcho, Bob Butler, himself a successful serial entrepreneur currently running BestThinking.com and ReallyWho.com in addition to TechStarts. Butler has a passion not only for helping other entrepreneurs but for boosting the Research Triangle area’s startup ecosystem to another level.

TechStarts Plus conference room

The entrepreneurial bug bit early

Bender says his own entrepreneurial instinct goes back to his childhood. “I was selling charm bracelets while everyone else was selling lemonade,” he says. “My mother was the bracelet manufacturer.”

He started a company to develop a wireless sensor network for construction site security when he graduated from college (with a BS in electrical and computer engineering from NC State) and got it in front of several local angels. But, says the 29-year-old Bender, “Most didn’t think I had the gray hair or experience to take it to market.”

He then spent four years at a software company which serves Fortune 1000 companies. He was responsible for a $500K business unit. He left his position in 2009 to help start Infused Industries.

Start a Facebook store in minutes

Facebook logoInfusedCommerce can quickly (within 10 minutes) create a branded Facebook store with payment and shipping options. That let’s the seller run exclusive product offerings, limited time promotions, on-going Facebook only deals, and promotion events that help grow the company’s fan base.

The Facebook stores integrate with a company’s standard processes. “We take a link from their products, a product feed, and enter than in our system,” Bender explains. “That sources the store with product information.”

Just putting products you can buy directly on a Facebook page does marginally better than a standard web site store, Bender notes. “A Facebook user education process has to occur so people know merchants are employing stores and Facebook is a place to shop.”

While that educational process will occur over the next few years, Bender says in the meantime, merchants can connect their products to Facebook promotions such as running a sweepstakes with a purchase component in the sweeps promo itself. “It reduces the friction on how you get there to make a purchase,” Bender says.

“That’s where a social media agency play comes in,” explains Bender.

InfusedCommerce also offers services to help make a firm’s “Facebook Commerce or F-Commerce” successful. “The business is pretty service heavy right now,” Bender says. “We help them identify what sorts of promotions work best.”

News feed product set for Q3

But the Facebook stores are just the tip of the InfusedCommerce ice berg. The company will also offer a technology that permits transactions from a Facebook news feed itself. It plans to start offering that service to help non-profits – and with the election year near – politicians, raise money.

The idea of targeting the political ecosystem will be “an interesting experiment,” says Bender. Facebook certainly attacts politically inspired comments, because as Bender notes, “Most people have strong views.”

The company plans to launch the news feed product in Q3.

For an article describing Go Smile’s experience using InfusedCommerce for Facebook Commerce, see:Solving Customer Experience Problems with Social Commerce: Infused Facebook eCommerce.

TJS article about TechStarts+ (it was orginally called TechSuites+)

No limit guts: Inception Micro Angel Fund’s high stakes approach in the RTP

Friday, May 20th, 2011

By Joe Procopio

Joe Procopio

Joe Procopio

Starting a company in post-mobile, post-social 2011 is a little like enrolling in a notorious party school. It’s not that hard to get in, it’s a hell of a lot of fun, but at the end of ride, not too many graduate and those that do might find themselves with an end result a lot less valuable than they had imagined going in. Plus alcoholism.

Seriously though, it’s cake to start a startup these days, especially in technology. In fact, by the time you finish reading this column, three more startups will have emerged in Durham, and there’s a 17 precent chance that you’re the CTO of one of them.

What with frameworks and toolsets and SaaS and eCommerce and automated storefronts, all you really need is an Internet connection and a couple hours in a Starbucks.

Get the Venti, your beta will be live by noon.

Lean Funding?

As the options have expanded and the barriers to entry fallen for creating the company, the options for funding have evolved in a similar fashion. As we approach the inevitable (but still far off, in my opinion) social/mobile bubble, Venture Capitalists have revised their theses to include companies that are earlier and leaner and thus in need of less of an initial investment.

This is what used to be Angel and Super Angel territory, but an interesting phenomenon is happening, especially in the RTP. The Angels are disappearing, or at least aren’t as active as they used to be, and the Angel groups that were mainstay of the dot-com era are all but gone. So the VCs are now filling some of that gap at the higher end.

At the lower end, we’re seeing everything from an increase in friends-and-family and bootstrapping to new trends like Micro and Kickstarter-style donation investing. Let’s call this Lean Funding – enough to get the product out the door to see if it’s going to be successful.

The return for this kind of funding is terrible, but the risk is also usually pretty low (provided some due diligence is done) as many of these businesses turn out to be of the Chamber or lifestyle variety, with enough success to keep the company growing slowly over time and providing (hopefully), a return to the initial investors.

But no exit.

The Middle Ground

So with the high end going to the VCs (roughly the $1M to $4M range) and the low end going lean ($10K to $50K), there’s still a big fat niche in the middle, companies that are on solid footing, with a viable product, pre-customer, but not enough capital to take the next step.

This is where IMAF-RTP wants to play.

The Inception Micro Angel Fund

IMAF-RTP made some noise a week or so ago when they announced they’d opened their doors and were beginning the investment process. They benefit from being a part of a larger and established entity, with IMAF already having a presence in Winston-Salem (two funds), Eastern NC, Charlotte, and Western NC (where they’ve invested in Creative Allies, an outgrowth of Sean O’Connel’s Music Allies in Asheville).

The RTP franchise is run by Bill Warner and Rich Kramarik, both of whom have worked together on Angel investments and a previous Angel group. IMAF-RTP is backed by a number of accredited investors. The fund is actively involved with companies seeking $100K – $150K to get from idea to final proof-of-concept or to get sales and marketing in place.

IMAF-RTP, like the rest of the IMAF funds, operates independently and seeks preferred equity. They work with a term sheet and expect a board seat just like your everyday Angel or VC. In fact, the likely next step for these companies, after the IMAF-RTP investment, is an additional investment from Angels or perhaps VCs.

So it’s a stepping stone for an early-stage company that isn’t quite Angel or VC-ready.

But is it the kind of company you’d start in a Starbucks?

Maybe.

Expensive Money

The risk/reward ratio of the playground in which IMAF-RTP will set up shop is higher than possibly any other type of investment, although it correlates to Angel and VC. These companies are very early, and the risk is not only off the charts, it’s hard to determine, let alone due-diligence be done.

IMAF-RTP has a formula, and I bet it doesn’t have a lot of rainbows and smiley faces.

At the end of the day, it’s all guts.

They apply this formula where they find cost-effective, fair, and elegant solutions to very painful problems. They’re not exclusive to B2B or B2C, or product or service (although I’m thinking the service model has inherent margin and rate-of-return issues that makes it a less likely candidate).

Ideally these companies have not sold anything, but they should have some initial contact with customers to prove out their product. When the company does move into the market, it should move quickly, with no long sales cycles or high capital expenses. There should be a very low barrier to entry and a short runway to exit. The company has to be able to grow to $10M or more in revenue in less than 5 years.

I Know, Right?

That’s every startup and it’s no startup.

But while IMAF is looking for a very unique type of company and making a very unique type of investment, it has a few differentiators that can make the deal compelling, the most important of which may be the network.

The IMAF group can do deal flow sharing/syndication and add on investments. After or even along with the initial $100K – $150K, the members individually can make additional investments and write the check through the fund. They all use the same resources for due diligence and the investment is all IMAF.

Further, all the IMAFs are positioned the same way, looking for the same things. The industries they invest in are different mostly due to the makeup of the membership. This makes it easy to agree on terms across the syndicate.

So Is It For You?

To me, this seems like the kind of opportunity for a  startup that’s perched and only needs a quick kick in the pants to be very successful. Those are few and far-between, and sometimes the issues preventing said success go beyond access to capital.

Again, it’s very high risk investment, and they tell me that the investors involved are risking no more than 5% of their overall portfolio in IMAF. They plan on investing in 15-18 companies with the RTP fund, some of which are already in due-diligence, and while they expect a home run every time they make an investment, they know they’re not going to bat a thousand. They expect a broad range of success, and I believe they’re looking for one or two homers and maybe a few triples.

Lean Angel?

So maybe it’s Lean Angel, the evolution of early Angel investment in post-mobile, post-social 2011. It all comes down to their model and the ability to do due diligence at that stage. If they can accomplish that, IMAF could be the impetus for a renaissance of seeding the Angels and VCs, which could open the doors for more startups. Which I like.

If it doesn’t? Well, I’ve played some poker in my time, and I can tell you, when you’re playing guts, you’re not thinking about losing, because that’s a sure sign that you will.

Joe Procopio heads up product engineering for sports media startup StatSheet (. He also owns startup consulting firm Intrepid Company and creative network Intrepid Media. He recently revived ExitEvent (ExitEvent.com) as a social/community outlet for startups. Joe can be reached via Twitter @jproco.

Time Warner boosting Internet speeds for Triangle customers

Thursday, May 19th, 2011

Time Warner CableRESEARCH TRIANGLE, NC – Time Warner Cable is introducing new ultra-fast Internet speeds today across North Carolina’s Triangle area, including Raleigh, Cary, Durham, Chapel Hill, as well as Wilson for its residential and business class customers. Customers now have the option of purchasing or upgrading to Time Warner Cable’s new, faster Wideband Internet or Road Runner Extreme service.

This comes following a vote by the NC state legislature to restrict municipal broadband development efforts by requiring voter approval of capital funds for such networks. The bill is on NC Gov. Bev Perdue’s desk. We have reported extensively on that issue.

In addition, all current Road Runner Broadband and Turbo customers will enjoy substantially increased speeds at no additional cost. Time Warner Cable has invested $8.5 million in the Greater Triangle area to support the upgrade and higher speeds.

“We are empowering our customers with pure online power to save time and boost productivity when multitasking with multiple devices,” said Christine Whitaker, area vice president of operations, Eastern North Carolina. “As customers expand their use of the Internet, our services are evolving to meet their needs.”

Wideband Internet–the company’s fastest residential Internet experience — provides customers with speeds up to 50 Mbps downstream and 5 Mbps upstream. Wideband is available as part of Time Warner Cable’s SignatureHome offering that includes the company’s most robust digital cable package, its fastest Internet service and  digital home phone product.

Road Runner Extreme delivers residential Internet speeds up to 30 Mbps downstream and 5 Mbps upstream and is a great alternative for families on a budget who desire extra speed.

As part of Time Warner Cable’s network upgrades, all current Time Warner Cable Road Runner customers in the area will automatically receive faster speeds for their existing Broadband and Turbo Internet service at no additional cost.

“We are substantially increasing our download speeds and essentially doubling upload speeds for our Road Runner Broadband and Turbo customers,” adds Whitaker. “This service upgrade demonstrates our commitment to deliver enhanced value to our customers.

Two former Google employees prefer the startup scene at Spring Metrics

Tuesday, May 10th, 2011

By Allan Maurer

Shannon Bauman

Shannon Bauman

DURHAM, NC – How do you get Google employees to move to Durham, NC and join a startup? Persistence worked for Spring Metrics, an analytics company that helps e-businesses understand what drives their revenue online. The company has signed two former employees of the search engine giant, a former product manager and an engineer.

“We didn’t actually look specifically for people who worked at Google. We were just looking for people we think are the best out there,” says Doug Kaufman, co-founder and CEO of Spring Metrics. But, he adds, “It does make the interview process easier knowing that Google puts them through the wringer.”

Google is known for its rigorous and daunting employee interview process.

Shannon Bauman, the former Google project manager, for instance, was asked: How many tennis balls fit in a 747? Why are manhole covers round? What is the air speed velocity of an unladen swallow?

Bauman was at Google’s Mt. View headquarters for most of his four years with the company, but spent a few months at its Chapel Hill office prior to co-founding Spring Metrics. “There were a lot of smart people at Google,” he says.

“It was a shock to be in an environment with so many people smarter than me. It was daunting at first, but you learn to value it. There is a very open and collaborative environment there that helps foster the ability to get information from other people’s brains and make better products.”

Bauman says that when he started at Google, “It had 2,000 people. Four and a half years later, it’s 20,000 people. I was really more interested in working with smaller companies. I figured I’d learned  a lot at Google, but the the things I’d keep learning by staying there were not as important as those I would learn by going to a startup. I thought of doing one myself, then met Doug and joined Spring Metrics.”

Networking paid off

He notes that he did a lot of networking when he first came to the area and “The Google name got me through a lot of doors.” At a Southern Capitol Ventures brunch, Jason Caplain introduced him to Kaufman.

“I love the Triangle,” he says. “The people the greenery, the space. It has so much going for it.” He admits, however, it is a bit harder to do a startup because there is less venture capital and angel money and fewer engineers than in Silicon Valley. “The more people you have in an ecosystem, the more things happen. California has ten times more people.”

Spring Metrics got its start with Launchbox Digital, the only Southeast accelerator to make a list of the top ten in the U.S., recently, then nabbed a $635,000 seed round from LaunchBox Digital, CBC New Media Group, Zelkova Ventures and Steve Vanderwoude and Lee Buck. The company’s product simplifies Web analytics to show only the data affecting the bottom line. It lets users see what is driving revenue and how they can actively generate more conversions.

Kaufman says that “If it were not for LaunchBox Digital, we probably would not have started this. Because of it, we knew we would have a much better chance of getting funding.”

A startup can do what a big company can’t

Patrick Scott

Patrick Scott

The company also set its sights on a Google engineer, Patrick Scott. The firm started talking with him at a very early stage, but as he saw where the company was going, “He realized it wasn’t going to fall off the map in five days,” says Kaufman. “So he got more comfortable and excited about a startup.”

But there was one other piece that worked in Spring Metrics’ favor. “There is something a startup can do that a big company can’t,” says Kaufman. “That is to really show someone how valuable they are. For us, pursuing this engineer, he knew we could only hire one guy. We showed him and told him how valuable he would be to us. We didn’t want just any engineer. We wanted him.”

That, he notes, “Goes a long way with people.”

Kaufman says the five-employee company is working on taking its product to another level. “We’re going to make this more useful, bring on another marketing person and bring on customers,” he says. While the firm is not looking for additional backing right now, “We will be,” says Kaufman.

 

 

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