Start-up is in search of the next big idea

Is this the return of the big Internet idea?

Talk to J.J. Allaire about his new start-up, Onfolio, and you get a 1990s-era blast of vision and ambition.

''The problem of search on the Web involves how you find things," says Allaire. ''Google came along and now you can find what you want more easily. But the problem of research on the Web is how do you organize and collect what you find? The product we've built gives people a place to put what they've found online."

Allaire isn't trying to create a better search engine; the software that Onfolio is launching today is a tool for research. It plugs into Microsoft's Internet Explorer browser and allows you to categorize, annotate, and store Web pages that you find. It's something that would be useful to a salesperson researching prospects, a consultant learning about a specific industry, or even a journalist working on a story.

Onfolio makes it especially easy to send a summary of your research to a colleague via e-mail or to publish it to a Web page on your company's server.

It's an elegant piece of software. But Onfolio plans to charge $29.95 for the standard edition, and $79.95 for a more sophisticated professional version. My biggest question is whether Onfolio can get people to abandon their inefficient (but free) ways of keeping track of their Web travels -- like adding pages to an endless list of bookmarks, or saving them locally to one's computer -- for something that costs money.

And the company is hoping that word-of-mouth, rather than an expensive marketing campaign, will spur adoption of the software. That works well for companies that give away a stripped-down free version of their software. We'll see if it works for Onfolio, which doesn't plan to give anything away. (I also wonder whether Google Labs, a division of the search company, will come out with free software that duplicates Onfolio's features.)

The eight-person company, known as Project31 while it was in stealth mode, is based in Cambridge. So far, it has been funded out of Allaire's pocket. Allaire, along with his brother Jeremy, started Allaire Corp. in 1995. Allaire, which made software for developing and operating Web sites, went public, and then was eventually acquired for $360 million.

Money mismanagementOne of the surprising survivors of the tech shake-out is CentrePath, a Waltham company that announced earlier this month it had raised a paltry $4 million round of venture capital.

Paltry, that is, compared to the sums that CentrePath raised back when it was known as GiantLoop Network. GiantLoop was founded by a trio of ex-EMC executives, and it raised and spent $160 million in venture capital to build an optical data network that it planned to rent out to corporate customers.

Current CentrePath CEO Jim Sullivan, also an EMC alum, says the old business model was too capital intensive, and customer demand didn't materialize quickly enough. The company changed its name, diluted the original investors' financial positions in a recapitalization, and cut back from more than 300 employees to 55 today. None of GiantLoop's founders are still with the company.

GiantLoop was never great at explaining what it did, and that's changed only marginally with CentrePath. The company seems to be focusing on software and services that help customers ''manage and monitor their infrastructure and data paths," says Sullivan. One ex-GiantLoop exec I spoke with said that while the old company was sometimes churlish in its dealings with business partners, the new CentrePath is much less so, having shed much of the arrogance that accompanied its EMC pedigree.

The company still isn't profitable, but Sullivan thinks this recent $4 million round will get it there. Greylock and Pilot House Ventures, investors in the old GiantLoop, both participated in the latest round, as did Roger Marino, a cofounder of EMC Corp., who has remained a big supporter of the company. Newly on board as an investor is Peter Bell, another EMC alum and the founder of StorageNetworks.

Suit, countersuitLast August, I predicted legal fireworks between Color Kinetics, a Boston start-up, and other companies in the business of making multicolored LED lighting systems. Back then, Bill Simms, the president of Color Kinetics, told me, ''We haven't invested the fortune that we have in intellectual property without planning to defend it." And others in the LED industry told me that they'd been feeling Color Kinetics' sharp elbows.

At that point, Color Kinetics had already filed suit against a publicly held Orlando, Fla., company called Super Vision, alleging patent infringement.

Last week, Super Vision struck back, filing a $10.5 million patent infringement suit against Color Kinetics. What makes the suit especially unusual is that Super Vision only a week prior had acquired the patent it says Color Kinetics is infringing on from another company.

The patent that Super Vision acquired from a third company called High End Systems covers a method for mixing various lights of different colors, says Super Vision CEO Brett Kingstone. But Color Kinetics believes the patent only covers mixing incandescent lights, and not LEDs, and says the Super Vision suit is without merit.

Kingstone says he is also planning to file a class-action antitrust suit against Color Kinetics, which he says has used intimidation to scare distributors and customers away from purchasing LED lighting from anyone other than Color Kinetics. ''They called our distributors and said, if you sell Super Vision's products, we're going to sue you into bankruptcy." Kingstone says that representatives of Color Kinetics also frequently showed up at trade shows and threatened manufacturers who didn't buy a license for Color Kinetics' technology.

Color Kinetics spokeswoman Felicia Spagnoli says, ''There's no way to comment on [a lawsuit] we haven't seen."

Moving onBruce Holbein, the vice president for public policy at the Massachusetts Software Council for the last five years, quietly left the group at the end of last year.

Holbein had been Digital Equipment Corp's top lobbyist through most of the 1980s and 1990s before joining the software council. He is now considering a career as a history teacher, believe it or not.

Instead of hiring another full-time VP of public policy, the software council has decided to outsource its lobbying to ML Strategies, a division of the law firm Mintz Levin focused on handling government relations. The chief executive of ML Strategies is Stephen Tocco, former CEO of the Massachusetts Port Authority.

The two big issues the group is working on, says Joyce Plotkin, executive director of the software council, are stock options expensing and offshore outsourcing. The council is against the former and for the latter.

''Companies that are stock rich and cash poor need to be able to use options to attract top talent," Plotkin says. ''We have been working with the Massachusetts delegation on some interesting approaches to the options expensing issue, and hope to have some progress in the next couple months."

Plotkin says that outsourcing programming work and software support to countries like India, China, and Russia can afford fledgling companies a competitive advantage -- and can help bigger firms stay fiscally sound. ''The political hype around this far exceeds the real number of jobs affected," Plotkin says. ''This is an evolutionary part of certain businesses. It happened with textiles and shoes, and we replaced those jobs with better jobs."

Could the software council's next move be to outsource its lobbying to Bangalore? Stay tuned.

Scott Kirsner is a contributing editor at Fast Company. He can be reached at skirsner@verizon.net.