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Entrepreneurship

As Karmaloop seeks to raise next round, it stretches some vendor payments and shutters underperforming sites

Posted by Scott Kirsner February 28, 2014 06:35 PM

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Hipster apparel merchant Karmaloop has been one of Boston's rare consumer e-commerce hits: the company, founded in a Jamaica Plain basement in 2000, booked $165 million in sales last year, according to CEO Greg Selkoe. And the company's headquarters have progressively taken over the inside of what was once the landmark Shreve Crump & Low jewelry store in Back Bay, where it employs almost 200 people.

But while Karmaloop CEO Greg Selkoe has been talking about an IPO for a while — and just this week told BostInno that he's in the process of raising $30 million — he sent an e-mail to some of the company's vendors this week that indicates the company is dealing with a cash crunch as it tries to nail down this new funding round.

It's one of the more, um, colorful communications between a company's CEO and its vendors that you'll ever read. Two different Karmaloop vendors who sell their wares on the site's Kazbah marketplace sent the e-mail my way. It went out on Wednesday. Selkoe's response is below.

Dear Kazbah Brands,

I wanted to reach out to all of you because I know you guys are hurting bad for payments and let you know that we will be getting you current very soon.

...Karmaloop had an amazing year in 2013 our best year ever and 2014 is going to be even better! You say well if that is the case why the f*** can’t you pay us quicker you mutha f****s?

Our current cash levels are tight and we are managing sh** very strategically. Karmaloop undertook expansion plans in 2013. We launched several new ecommerce businesses (MissKL, BrickHarbor, Boylston, Monark Box) in retrospect we may have been a little too aggressive. Over the last several years the funding markets rewarded ecommerce companies that had been growing and expanding rapidly with a focus on top line revenue providing high multiples for valuation. Because of this there was lot of relatively cheap money in market so dilution of ownership was small and people us included were putting a lot of money into new initiatives..but due to some high profile f**** ups of several ecommerce sites (Fab.com, Beachmint.com thank you for that) the market has done 180 degree turn away from valuing expansion to an EBITDA focus. Karmaloop had pivoted aggressively and shut all of our extra business to get spending in line with the renewed focus on EBITDA.

The good news is Karmaloop has been profitable for many years we had [been] putting that money into investing in newness in 2013 and we have already made cuts that have brought us back to cash flow positive on a go forward basis plus we have been raising a new round of capital to support continued growth of our core which we are focusing ONLY on this year (Karmaloop, Kazbah, PLNDR). We have three different offers on the table for new financing for core business, but we are taking our time and making sure we get the best value and best investment partners. We cannot rush this it, we need to make sure it is the right fit. I put my whole life into Karmaloop blood, sweat and tear…and for some reason all the money I make seems to just go back in….. cause well I am like you I like to build sh**! For those of you starting out you will see that the ups and downs of cash flow is a big part business.

...You have my word everyone will get paid and we will f****n kill it for you guys this year!

I appreciate everyone’s understanding...

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Here are the 14 startups that just nabbed free space at PayPal's Start Tank

Posted by Scott Kirsner February 28, 2014 08:00 AM

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PayPal's Boston office is filling its Start Tank with a new set of early-stage ventures. Created in 2012, the Tank offers entrepreneurs free office space in downtown Boston, along with mentorship from PayPal employees and seminars. Companies are welcome to stay for six months to a year; this is the third crop of businesses that the Start Tank has housed.

"This group is heavily weighted toward e-commerce, digital media, and the sharing economy," says David Chang, chief operating office of PayPal's Media Network. Karen Landry, who helps run the program, says they received more than 80 applications, and chose 14 companies. (That's Landry and Chang at work doing the choosing, at right.)

There's some intriguing stuff in the mix, from a mobile eye care clinic to a "tackle box-of-the-month" club. One company, Dashbell, previously participated in the TechStars Boston accelerator and raised $700,000 from angel investors last summer; I've written about another, ServiceRoute, which offers an on-demand snowplowing service called PlowMe. The founder of ScreenEx, John Nguyen, was a founder of Vlingo, a Cambridge startup that developed a pre-Siri app for using voice to interact with apps on mobile phones. (Vlingo was acquired by Nuance in 2011, after dueling with the speech recognition giant in court.)

Here are the descriptions PayPal provided, along with links when available:

Covvet is an online wish list that tracks prices on the web so you never miss a sale on the things you want.

Second Chance Technologies is a new online and mobile platform that fundamentally changes how consumers find the best deals and make purchases.

Project 2020 delivers cost-neutral, on-site eye care and comprehensive eye exams to businesses and their employees via a state-of-art mobile eye clinic ("eye truck”).

ServiceRoute drives commerce and increases route density for residential contractors by clustering properties for service.

Canary is a safer, local online marketplace that donates 30% of its profits to local charities.

Dashbell enables independent hotels to take control and reduce commissions paid to outside travel agencies through an online reservations tool and hotel management system.

onthebar connects consumers and spirit brands with the most effective and charming salespeople on earth, bartenders.

Nineteenth Amendment is a fashion marketplace and manufacturing service for emerging designers where we manufacture all garments that sell through our site on behalf of the designer, in the USA.

Supplet is a healthy pregnancy marketplace, community and monthly gift box service for pregnant women and new moms.

Tackle Grab is a subscription-style discovery retail service that delivers monthly boxes of fishing tackle to its members based on their preferences, coupled with an e-commerce platform that offers on-demand products.

ScreenEx provides apps and websites that simplify the online video-viewing experience with a personalized stream.

SparkFull is a mobile electric vehicle (EV) charging service.

Wellable is a mobile wellness company that leverages mobile apps, text messaging, and traditional wellness services, such as flu shots and biometric screenings, to deliver highly effective programs.

Givewell Getwell connects patients and their families to loved ones and local service vendors who want to provide support (e.g. transportation, meals, home care) through a web-based tool that integrates patient registries with a peer-reviewed directory of local services

Recent Start Tank tenants have gone on to participate in TechStars Boston and the LearnLaunchX accelerator for educational technology companies. CO Everywhere, another recent alum, raised a $6 million funding round earlier this year.

Video: Entrepreneur Steve Papa on building a startup worth $1 billion

Posted by Scott Kirsner February 21, 2014 08:25 AM
Everyone has been obsessed this week with Facebook's acquisition of WhatsApp for a stupendous $19 billion.

When someone is buying Massachusetts companies for a price tag that ends in a "B," it tends to be an enterprise technology company like Oracle — not one of the big Silicon Valley search or social giants. In recent years, Dell picked up EqualLogic for $1.4 billion, and Oracle bought two local companies, Endeca and Acme Packet, for $1.1 billion and $2.1 billion, respectively. We've also seen a handful of billion-dollar life sciences acquisitions, as when Japanese purchasers bought Millennium Pharmaceuticals ($8.8 billion) and Boston Biomedical ($2.6 billion.)

Our last local acquisition in the WhatsApp ballpark? When drug developer Genzyme was sold to Sanofi Aventis for $20 billion, plus performance bonuses. But Genzyme had 10,000 employees and $4.5 billion in revenue. (WhatsApp has 55 employees and undisclosed revenues.)

Here's an interview I did with one entrepreneur who joined the billion-dollar club in 2011, Endeca founder Steve Papa. Endeca initially built software to help users find what they were looking for on e-commerce websites, and later business intelligence software to help companies analyze their operations. We talked about Papa's upbringing in the Catskills; what made him feel like he could be an entrepreneur; hiring his first few employees; and building Endeca into a multi-national company. It was recorded at the TEDxBeaconStreet conference last November, and it runs about 15 minutes.

Papa has a great sense of humor, and some wonderful perspective on the entrepreneurial mindset. One quote I love:

"Building a startup company is a combination of profound creativity and insight in one sense, and profound ignorance in another sense. People will say, if they knew then what they know now, they probably wouldn't have done it. Are you one to focus on what's possible, versus what could go wrong? An entrepreneur, 99 percent of their thinking is on what's possible."

(In the interview, we also talk a bit about the story of Puffer the Pufferfish, Endeca's mascot.)

What happened when Boloco founder John Pepper became an Uber driver

Posted by Scott Kirsner February 7, 2014 01:09 PM

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Last October, Boloco co-founder and CEO John Pepper resigned his job after a tussle with directors about the restaurant chain's direction.

In that situation, lots of other entrepreneurs might take time off to travel, or become an "entrepreneur in residence" at a college or investment firm.

Pepper decided to become a part-time Uber driver. (Uber is a transportation service that lets you summon a range of vehicles, from taxis to SUVs, using a smartphone app. The drivers are all freelancers.) He's done almost 50 rides so far, in his Jeep Wrangler and his Tesla Model S electric sedan. Often, he picks up Uber passengers after he has dropped his kids off at a Cambridge private school. Yesterday, he said he drove seven hours non-stop, until his wife called and asked him to "stop Uber-ing."

I asked him what he's been learning. He also shared a short video, which you can see below.

Q. So what made you want to do this?

A. I've always had this impulse to just leap, to keep things interesting, do things that might provide a different perspective. My friends are like, you are absolutely out of your mind. But I've always told people, if I wasn't in the burrito business for the last 17 years, it would have been transportation.

Q. So you started driving right after you'd resigned from Boloco.

A. I got into an Uber with a guy named Shabih. This guy was the first guy I spoke to on the first day of the rest of my life. I didn't give it five seconds thought. It was October 7th, after a three-hour meeting with my investors the day before. He told me he would get $250 if he referred a new driver to Uber. So my goal was to get my guy $250. It would feel good, like good karma. Even though I was tempted to blow it off, I wound up going to a company training session in late October, at a Holiday Inn in Dorchester. They never looked at my car.

Pepper talks about the training session in a blog post he's writing about the experience:

We were instructed on the basics of being an Uber driver. It lasted 20 minutes. What followed was the most brilliant 40 minutes of Q&A I’ve witnessed. Whatever it is that was actually asked, I came away from that short session with only a few takeaways. I hope it was intentional.

1. Never, ever try to call Uber with problems… because they don’t even have phones and there is very little if any reason to talk to them.

2. The customer is always right; and on that note, default to giving them a 5.0 rating.

3. Uber takes their rating system very, very seriously. Stay above a 4.5 rating and you’re fine. Fall below and you face removal from the system. No stories. No excuses. No phone calls.

As I got ready to leave the “training” program a few minutes early (I had a date with my wife), they snapped my mug shot, issued me my phone, a minute of friendly chit chat, and off I went.

Q. Did you sign up because you wanted to learn about Uber?

A. Whatever business I do next, there's a lot to learn from their model. Wherever possible, they leverage skills we already have — people already know how to drive. They set very, very clear expectations as to what constitutes success, and then they follow through with the metrics. There are no stories [from drivers] — they don't want to hear why this customer was wrong, or that customer was crazy. There are these things that are rigid and effective, but I think they could really effect the world of restaurants and retail.

Q. I assume you've been following the debates about Uber's surge pricing [when they increase fares at times of high demand, like during a rainy rush hour.]

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Fundraising advice for entrepreneurs, from CO Everywhere's recent $6 million round

Posted by Scott Kirsner January 6, 2014 08:48 AM

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Boston-based CO Everywhere, a mobile startup that displays social media posts about specific locations, raised a $6 million A round last month from Morningside Group. I wrote about the process in yesterday's Globe; CO Everywhere founder Tony Longo met with more than 200 investors, and seriously considered moving to California, where he felt there was a stronger support system for consumer-oriented mobile apps.

The $6 million round happened after Longo had successfully raised about $1.5 million from individual investors, and executed a major pivot. (The company began life as a website that collected information about neighborhoods, and it was known as Block Avenue.) That's not a trick that every seed-funded startup will be able to pull off. So I asked Longo to share some of the fundraising lessons he learned along the way. His advice is below, with any of my clarifications in brackets [ ]...

    Lessons:

    • If a VC doesn't invest in you on your first meeting, chances are they never will ("invest" meaning they schedule a follow-up for the next day, or bring other partners in immediately.) You know when this is happening. It's very clear and beyond exciting.

    • Listen more. When two or three VCs pass on you, you need to re-adjust. Maybe a new pitch, maybe an entirely new product. Don't do what I did and just plow through more meetings.

    • Every pitch needs to be strategic. Don't pitch until you are ready to raise. Introduction meetings to "show and tell" [what you are working on] will be the death of you with that firm.

    • Time management is crucial. At this stage, your time is worth way more than any VC's time. Cut meetings short if it's clear they are not a good fit; investors will respect you for that.

    Tips for entrepreneurs:

    • Immerse yourself as deep as you can into your local technology ecosystem. We started at Dogpatch Labs and met a key group of influencers who introduced us to other groups. Here, I met my co-founder Dan Adams. Also, our Dogpatch neighbors Joshua Summers & Doug Hurd from Clypd introduced us to David Chang and the PayPal Start Tank, which has been one incredibly awesome resource for us. [CO Everywhere is currently based at Start Tank, which offers free office space to selected startups.]

    • Lead investors are instrumental in any early-stage company. Focus on finding a few leads and everything else will fall into place. I am not sure we are where we are without Eric Silverman, Semyon Dukach, Robin Brown and a few friends from State Street Bank.

    • A great VC won't leave you empty-handed. The second-best thing a VC can do for you, aside from invest, is help open doors and make introductions. One in particular personally helped set us up with several San Francisco-based firms, as that is where he thought this company should live.

    • Network like crazy (online and offline).

    • Skip everything and build a great product. Just get what you need to create something special, don't get distracted with "the other stuff."

The CO Everywhere app, incidentally, is really worth getting — it's a fun way to keep tabs on places you care about, whether a ski resort you visit a few times every winter or the town you went to college in.

'Uber for private jets' is grounded, but CEO says he hopes to raise more money and fly again

Posted by Scott Kirsner December 19, 2013 12:58 PM

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A celebrity-backed startup that wanted to become the Uber of private jet travel — and had Uber co-founder Garrett Camp on its founding team — has laid off most of its employees as it seeks to raise more cash.

Florida-based BlackJet raised north of $2 million last October from backers like Ashton Kutcher, Jay-Z, Will Smith, Salesforce.com CEO Mark Benioff, and Ryan Sarver, an ex-Twitter executive who earlier worked at Boston-based Skyhook Wireless. It planned to sell individual seats on private jets flying popular routes like New York — Los Angeles or Boston — San Francisco. (The company's site quotes a BOS — SFO one-way trip at $3,766.) But in order to buy those seats using BlackJet's website or mobile app, you'd have to pay an annual membership fee of $2,500. Members also had to give two days notice when they wanted to fly.

BlackJet was the new incarnation of a West Palm Beach company that had tried something similar as early as 2010, called Greenjets. But less than a year after BlackJet's splashy launch last fall, its chief technology officer had departed, and founder Garrett Camp — also chairman of Uber — was no longer even mentioning the company on his LinkedIn profile.

blackjet2.pngA former BlackJet employee, who requested anonymity, said that "you can't fly somebody for $3500 coast-to-coast and guarantee them a seat when it costs you $20,000 to fly the plane." Often, planes flew mostly empty. "And if you had eight people on the flight, nobody was happy and it was crowded."

"We were losing $200,000 a week," the ex-Blackjetter told me. Most of BlackJet's employees were laid off in September, this person said, after "the investors weren't willing to put in more money."

BlackJet CEO Dean Rotchin tells me via e-mail that he expected additional funding "in the second quarter of this year which did not come through." He says the company continues to offer a more traditional whole aircraft charter service, but has "curtailed" the per-seat offering "over the last few months."

"Many flights were already profitable, many were not," he says.

Rotchin says the key to operating the per-seat service profitably is, quite simply, attracting enough members who want to fly to the 10 cities BlackJet serves. "We spent almost nothing on membership acquisition [attracting members], and yet still reached decent flight-level economics," Rotchin writes. "We are leveraging this data, and looking for additional capital. We will acquire sufficient members and restart the service."

It'll be interesting to see whether BlackJet can find a way to take to the skies again...

Instacart introduces neighbor-to-neighbor grocery delivery to Boston

Posted by Scott Kirsner December 11, 2013 08:00 AM

Update: Instacart is now offering groceries from Whole Foods, and expanding its coverage area to include neighborhoods like Brighton, Jamaica Plain, Brookline, and North Dorchester.

With holiday parties and family meals looming, it's easy to see the appeal of Instacart: you can order groceries online and have them delivered to your doorstep in an hour or two, for a delivery charge of as little as $3.99.

And here's the twist: similar to errand services like Task Rabbit or transportation networks like Lyft, just about anyone who can find their way around the produce section can sign up to earn money as a grocery courier for Instacart. The company says that its "personal shoppers" earn an average of $20 an hour, but they're paid based on the number of orders they handle, and the size of those orders. It raises the interesting possibility of pocketing some extra dough by shopping for a few neighbors whenever you visit the store.

Instacart_Apoorva high res.jpg"My fridge was always empty," says Instacart founder and CEO Apoorva Mehta, right. "I just never had time to go to the grocery store during the day." Mehta previously worked to improve order fulfillment at Amazon, and as an engineer at Qualcomm and RIM. Instacart started in San Francisco, and expanded to Chicago in September; Boston is Instacart's third market. "Our goal is to offer an Amazon-like experience without building any the infrastructure, using crowdsourcing," Mehta says.

At first, Instacart will offer only groceries available at Shaw's. But it will eventually expand to offer items from Whole Foods and Costco and other stores, Mehta says, letting consumers purchase certain items from each store, and have them simply materialize on their doorstep a few hours later. Typically, Mehta says, if a consumer chose items from three different stores, that order would be filled by three different personal shoppers. Instacart says the food prices on its site can be the same or higher than the prices you'd pay in the store.

For consumers who request delivery in less than two hours, the company charges a $3.99 fee for orders over $35, and $7.99 for orders under $35. The minimum order is $10. The company says its fastest delivery was made in 19 minutes, but deliveries can also be scheduled for specific times or days when you'll be home. Instacart also offers a service similar to Amazon Prime: for $99 a year, all under two hour deliveries over $35 are free.

The company is in the process of signing a lease for its local office, in Cambridge's Central Square. Mehta tells me Instacart has already hired one person for its Boston operations, and plans to add two more.

The map of Instacart's initial delivery area, in Boston, Cambridge, and Somerville, is below:

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Fancy pants: My experience with custom chinos from Blank Label

Posted by Scott Kirsner November 29, 2013 08:00 AM

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Director of client services Suzy Tepper, in Blank Label's Newbury Street showroom.

I've been tracking Blank Label since the apparel startup was born in 2009, on the campus of Babson College. From the beginning, the company's vision was to give men the opportunity to buy custom-tailored clothes at more affordable prices than they might have expected.

I checked out the Blank Label site when it first launched — but didn't wind up purchasing anything. (I wanted to know what kind of fabric the shirts were made of, and it didn't tell you.) But while researching a recent column about e-commerce companies opening brick-and-mortar showrooms in Boston, I stopped by Blank Label's third-floor space on the corner of Newbury and Gloucester Streets. And I decided to order a pair of $95 chinos — a product that Blank Label only recently started selling. (They're not yet available on the website.)

Blank Label decided to open up showrooms in Boston and Chicago (and next year, in Washington, D.C.) after it realized that many men were more comfortable buying custom apparel when they could try something on, touch the fabric, evaluate the different options, and get measured by someone who knows how to properly use a tape measure. And the showroom experience is pretty luxe: you make an appointment, you're the only client in the showroom, and you're walked through all of the choices (the company currently offers shirts, pants, and suits in its showrooms). Director of client services Suzy Tepper offers her advice; with her help, I picked out a pair of gray cotton chinos — a color I probably wouldn't have otherwise considered. Once I tried on a pair they had at the showroom, Tepper took my measurements, entered them into an iPad, and told me that I could come back to pick them up in two weeks. (Shirts are made in seven days, Tepper says.) I paid with a credit card.

blank2.jpgI really liked the in-person, low-key shopping experience at Blank Label's showroom. But what happened afterward left a bit to be desired. I never got the promised e-mail receipt; Tepper told me that chino orders hadn't yet been properly integrated into the company's system. Seventeen days after my visit to the showroom, I e-mailed Tepper to ask about the pants. She told me that it had been a busy fall, but that the pants would arrive in two days. The company invites customers to come back to the showroom to try on the merchandise, in case additional alterations are required. (Tepper also offered to mail the pants to my house.) We exchanged numerous e-mails to try to find a time when Tepper and I were both available. When I finally managed to get back to the showroom, the pants fit perfectly — but some stitching on a belt loop ripped as I was putting them on. Tepper told me that someone could fix that quickly. I went to eat lunch, then returned 45 minutes later to finally get the pants.

The pants are great — much better-fitting and more comfortable than any off-the-rack chinos that I own. But I have two quibbles with the process. First, it would be much more convenient if I could have scheduled my visits to the showroom online, rather than with a string of e-mails to Tepper. And second, with shirts, the company makes it possible to re-order additional ones online after you've been measured in the showroom. That feature isn't yet available with pants. "If you wanted to order another pair of chinos," Tepper explained in an e-mail, "you simply contact me and let me know what color you would like, make an appointment, or I would email you color swatches to assist you with color choices. Once decided, our tailors would make your chinos based on your previous chinos pattern."

Also, given that the pants were custom-made, it would've been nice to have some kind of personalized label or monogram or even a Blank Label tag on the inside. But the pants were totally unadorned, as was the gray shopping bag they came in.

Overall, I was happy with the final product I received— but I found the process to be more time-intensive than it needed to be.

Sneak peek: Gemvara's new custom jewelry "experience" on Newbury Street

Posted by Scott Kirsner November 1, 2013 09:34 PM

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Boston jewelry e-tailer Gemvara is planning to open its first bricks-and-mortar showroom this Sunday, on Newbury Street between Clarendon and Dartmouth. It's a pop-up location — they like to call it an "experience" — that'll be around until Valentine's Day. I stopped by Friday afternoon to have a look. Several media events and the official grand opening are slated for next week.

I wrote recently in the Globe about web retailers like Gemvara, Bonobos, and Blank Label experimenting with retail spaces. Gemvara's is designed to explain the company's build-whatever-you-imagine approach to jewelry, and to let customers try on a range of different items (some with real gemstones, some with synthetic ones). But all purchases will be made on tablet computers or the showroom's two in-store iMacs. The store will be staffed by existing Gemvara employees, some of whom volunteered to participate in a retail training bootcamp.

The project has been overseen by Callie Smith, Gemvara's director of online mechandising (above), and CEO Janet Holian. Holian tells me the company is open to the notion of a permanent showroom in Boston or New York, but probably not in the current location. Holian says the company will be attempting to measure whether the Newbury Street location, along with some highway billboards the company is buying around the city, have an impact on online sales in the Boston area.

Photos below...They were still putting the finishing touches on the space when I visited today at 5 PM.

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Could TechStars Boston actually be moving to Boston?

Posted by Scott Kirsner October 22, 2013 05:02 PM

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Since it launched in 2009, the TechStars Boston accelerator program, which cultivates and invests in fledgling businesses, has actually been a Cambridge-based organization.

But its days of shacking up with Microsoft in Kendall Square are numbered. And it looks like TechStars Boston might be on the verge of hopping the Red Line and relocating to the Leather District, near South Station. According to several real estate industry sources, TechStars is close to subletting space formerly occupied by the FlipKey unit of TripAdvisor at 179 Lincoln Street; the FlipKey team will be moving into new TripAdvisor space near North Station. TechStars will occupy about 12,000 square feet, and will share the space will be Startup Institute, a training program for would-be tech workers that originally sprang from TechStars Boston.

Katie Rae, managing director of TechStars Boston, wouldn't confirm the location, and she wasn't ready to talk about the new digs. But she did say that TechStars expects to move out of its current space sometime in mid-January, before its spring cohort of entrepreneurs arrives. The sublet on Lincoln Street would run through October 2015. Cassidy Turley, one of TechStars' sponsors, has been helping the accelerator with its lengthy search for a new home.

179 Lincoln is on the edge of the Leather District, facing Chinatown, and only a few blocks from South Station. Its a neighborhood that has attracted a new wave of startups as rents in Cambridge and the Innovation District have risen, including Rest Devices, Ministry of Supply, TurningArt, SpreadShirt, and Uber Boston. If TechStars nails down this lease, its building-mate at 179 Lincoln will be NextView Ventures, an early-stage venture capital fund.

The challenge of finding a new home is one reason that TechStars has fallen off its pace of running two programs a year, in the spring and fall. "We didn't know if we' d have space for a fall program," says Rae, "and also, Reed [Sturtevant] and I needed a small break. There will be two classes next year, and what feels right to us is about a class every nine months. So some years, it'll be two classes, and some years it will be one." Sturtevant is the other managing director at TechStars Boston.

(The photo above is from TechStars' most recent demo day, held in May.)

Tiggly's iPad toys for toddlers heading for Apple Store shelves

Posted by Scott Kirsner October 8, 2013 08:20 AM

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Is there life after a Kickstarter campaign that fails to meet its goal?

A startup from two Harvard Business School students, Tiggly, made a big splash last fall when it set out to raise $50,000 on the crowdfunding site. But the product, which includes a set of cookie cutter-like shapes and iPad games that they can be used with, only got about halfway to its objective. And according to Kickstarter's rules, if you don't hit your goal, all of the money pledged goes back to the people who pledged it.

But Tiggly founders Phyl Georgiou and Bart Clareman were undeterred. "We put our heads down and focused on building great apps and great products," says Georgiou.

They went to a major toy industry trade show in New York earlier this year, which led to a connection at Nordstrom. And someone who'd noticed their Kickstarter campaign last fall happened to work for Griffin International, a Minneapolis rep firm that helps new products get retail distribution. That second connection, after six months of discussions, led to a deal to put Tiggly Shapes, the company's first product, into Apple Stores in the U.S., Europe, and Australia. They'll sell for about $30, which includes four shapes, three games, and a carrying pouch.

"We're trying to build a learning company — the next version of LeapFrog," says Georgiou. "We know that parents still have a degree of apprehension about letting their kids use the iPad, the way previous generations did about television. But physical objects like Tiggly Shapes are critical to learning in early childhood." To address some of those qualms, they've added a doctoral candidate in early childhood education, Azadeh Jamalian, to their team.

The company's games include Tiggly Safari, which invites toddlers to use the shapes to make animals, and Tiggly Stamp, below, which relies on the shapes to imprint designs onto different seasonal scenes. The company is marketing Tiggly Shapes to parents of children between 18 months and four years old. They'll show up on Nordstrom.com and in Apple Stores early next month. (They're already available on Tiggly's own site.)

After Georgiou and Clareman graduated from HBS this spring, they moved the company from Harvard's iLab to a collaborative workspace in New York, WeWork. "If you're a consumer-facing company," Clareman says, "we think you're better off in a place like New York. And Brooklyn is full of people who want Tiggly products." Georgiou says the startup is in the process of wrapping up a $500,000 round of funding, led by Kae Capital of India.


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Bonus material: What happens after the accelerator program, after the demo, after you raise the million bucks?

Posted by Scott Kirsner September 23, 2013 10:05 AM
So many startups these days are going through accelerator programs. And so many are raising a seed round afterward — anywhere from a few hundred grand to more than a million.

I wanted to look at what happens afterward for some of these ventures when all of the pieces don't come together quickly enough, and they can't raise additional funding. The story of GreenGoose seemed like a good one to examine. Founder Brian Krejcarek had been through the Betaspring accelerator in Providence, worked out of Cambridge Innovation Center, and attracted as his first investor Bill Warner, a prominent Cambridge angel investor. The company closed up shop earlier this year.

From the start of Sunday's Boston Globe column:

For Brian Krejcarek, Feb. 23, 2011, was the day every entrepreneur dreams about. He was offered a last-minute opportunity to present his product in front of a panel of investors and an audience of peers at a San Francisco conference called Launch.

At the time, Krejcarek was illicitly sleeping either under his desk at the Cambridge Innovation Center or on a mattress stashed in an air shaft of the building. Rather than paying for an apartment, he wanted to put the money into his start-up, GreenGoose. Its big idea: inexpensive wireless sensors that you could affix to any object, like a bicycle or a child?s toothbrush, to track how often it was being used. Krejcarek suggested that adults and kids might be motivated by earning points for those activities, and the company tagline was "Play Real Life Even Better."

Krejcarek's demo could not have gone better. Two investors on the panel committed $100,000 in funding for the company before he?d left the stage. The company won an award at the conference, got lots of ink, and eventually raised a little over $1 million.

Here's GreenGoose's demo at the 2011 Launch Conference, which is followed by several investors on the panel committing to put money in.

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The manicurist down the hall: Startup Manicube will bring the nail salon to Boston workplaces

Posted by Scott Kirsner September 23, 2013 08:00 AM

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Being crunched for time is no longer an excuse for having ragged fingernails. The 15-minute, in-office manicure is coming to Boston.

Manhattan-based Manicube plans to begin operations in Boston next month. Its flagship service is a 15-minute, $15 manicure, including nail polish; a men's "clip and clean" is $12. Manicube already dispatches manicurists to 40 workplaces in New York. Founders Katina Mountanos and Elizabeth Whitman, right, say they expect to launch in Boston with more than ten companies participating. Some companies, they say, simply set aside an office for Manicube once a week, while others subsidize the costs of manicures or offer them free as an employee perk.

"When we compared Boston to New York, we found that there were fewer nail salons in Boston, and that the average price of a manicure is about $4 higher than New York," says Whitman. Mountanos says the service is "for working women. It's designed to save them an hour from their weekend, or from having to leave the office for an hour and wind up extending their workday." She says just eight percent of Manicube's customers so far are men. Appointments are booked online, and can be paid for on the web, or at the office, using an iPad with a credit card reader. Manicube communicates with its army of manicurists via text message; they can choose to accept or reject a given job, since many of them also have their own clientele or work part-time at spas.

Manicube launched in Manhattan last year, and raised a seed round of funding this spring. Mountanos says the company is exploring offering additional services, like pedicures, chair massage, and "other beauty services," she says. At each office visit, the company aims to do about a dozen manicures, but there's no commitment beforehand.

Mountanos and Whitman were in Boston last week, interviewing manicurists, talking to office managers and human resources execs at local companies, and lining up office space. They landed at PayPal's StartTank in the Financial District, which offers free space to chosen start-up businesses. Annie Grayson Ode will run Manicube's Boston operations.

Manicube's founders are both graduates of Harvard Business School; they previously worked for Quidsi (now part of Amazon), developing and marketing an e-commerce site called BeautyBar.com.

The Food Loft seeks to become a hub for Boston's culinary-tech startups

Posted by Scott Kirsner September 18, 2013 08:25 AM

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Boston and Cambridge are now dotted with startup spaces geared to entrepreneurs in big data, videogames, cleantech, and educational technology. The newest one, the Food Loft, aims to provide a home for alimentary innovators. Companies began moving in last month, and the official opening party happens next week.

The force behind the Food Loft is Harvard Common Press, a South End publisher of cookbooks like "A Fistful of Lentils" and "The Ultimate Panini Press Cookbook," as well as parenting guides. The first three tenants are Bakepedia, an online resource for bakers; Culture, which publishes a magazine and website about cheese; and Nosh On It, which curates the best recipes from blogs and delivers them in an e-mail newsletter.

The Albany Street space is about 3,500 square feet, with room to grow, says Adam Salamone, associate publisher at the Harvard Common Press. He says that as many as seven more startups could fit in the space. "It’s a bit different than the Cambridge Innovation Center or other similar spaces because we offer each company dedicated work space, rather than an open desk set up," he says. Rents start at about $100-$150 per employee per month, but it varies depending on the tenant's needs, Salamone says.

Salamone describes the Food Loft as "an anchor for food innovation in the Boston area." He has been developing the space along with Bruce Shaw, president and publisher of Harvard Common Press. Shaw has made investments in food-related startups like Yummly, a search engine for recipes, but the goal of the Loft isn't explicitly to source more deals, or provide a home for companies he has invested in. But Salamone says that they are exploring the possibility of "launching a dedicated early-stage food fund that will invest and advocate for food entrepreneurs and innovation."

It'll be interesting to watch as the space — and possible that new fund — develops...

Sniffing the future, at Le Laboratoire Paris

Posted by Scott Kirsner August 29, 2013 12:30 PM

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In the future, you might ask a friend, "Is that your phone smelling, or mine?"

Our mobile devices already ring and vibrate to get our attention, but a prototype device created at Le Laboratoire in Paris, the oPhone, suggests that soon they might also emit odors. Le Laboratoire is run by Harvard professor David Edwards, who splits his time between Boston and Paris; it's a retail, R&D, and exhibition space a few blocks from the Louvre, and a domestic version called Le Lab Cambridge is set to open in Kendall Square next year. I stopped by last month to have a look at both the oPhone (the "o" stands for olfactory), and the space itself.

The current oPhone, part of an exhibit at Le Laboratoire called "Virtual Coffee," is a separate handheld device that is linked to a smartphone via Bluetooth. (Obviously, the long-term vision is to have it integrated into phones, or perhaps designed to be a protective case for the phone.) When triggered by an incoming e-mail, it can emit one of four aromas: espresso, hazelnut, latte, and mocha. "There's a small cartridge inside that has the ability to deliver these micro-odors when it is heated," Edwards says. As a demo, he sends a whiff of espresso to a student, on the far side of his office. (In the picture is Edwards with Rachel Field, a Harvard student who helped create the oPhone. The demo was still a bit flukey.) "We're working now on a way to mix the oPhone's aromas," Edwards says. He talks about the possibility of discovering odiferous building blocks — the equivalent of DNA's nucleotides — that could be blended to create just about any smell.

Screen Shot 2013-08-29 at 12.43.17 PM.pngIn terms of the oPhone's future potential, there are obvious applications like using smell to persuade you to book a spa treatment, or stop by a bakery to grab a fresh baguette. But Edwards has other ideas, too: "You might go to see a movie, and you'd get a cartridge that's synchronized with the movie, and integrates with the drama. It could be relevant in gaming — a scent track you could design for a game or any audio or video program." Edwards is also interested in what you might call therapeutic smells: a unique aroma that helps you fall asleep at night, or makes you less hungry.

A new oPhone prototype will debut in London this October, Edwards says, at a conference put on by Wired Magazine. "People will design a Virtual Coffee Mocha as a 'symphony' [by] mixing different coffees, chocolates, caramels, and nuts in four movements of 30 seconds total," he writes via e-mail. It will be capable of delivering over 100 different aromas, Edwards says. And next June, when Le Lab Cambridge opens, he says that he expects to have an oPhone focused on "culinary applications."

The Cambridge space, right near Genzyme's headquarters at 650 Kendall Square, will be somewhat similar to Le Laboratoire in Paris, with an exhibition gallery, an auditorium for seminars, a retail space, and a restaurant. (One of Edwards' startup companies, Cambridge-based WikiFoods, produces snacks in edible packaging, like mango ice cream surrounded by a coconut "skin." They're pretty similar to Japanese mochi.)

Much of Edwards' career has been focused on new ways to deliver food, beverages, and pharmaceuticals. (He was a co-founder of a company now known as Civitas Therapeutics, which is developing an inhalable prescription drug for Parkinson's disease.) It sounds like Le Lab Cambridge will showcase those interests, blending in art and performance, as the Paris version does.

In Cambridge's academic and entrepreneurial community, Edwards says, "We are not good at showing what we do. So Le Lab Cambridge will ask the question, how do we share it?" That's a laudable mission.

Below is a video demo of May showing the oPhone in action, followed by a few photos from Le Laboratoire Paris:

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Forrester Research prepares to mark 30 years in the prognosticating business [Audio]

Posted by Scott Kirsner June 27, 2013 08:00 AM

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George Colony launched Forrester Research three decades ago, in the basement of a Cambridge triple-decker. In 1983, he was a former Yankee Group analyst writing about how the personal computer was going to change the business world, at a time when most tech watchers were focused on mainframes and minicomputers.

Today, Forrester (which happens to be Colony's middle name) is a publicly-held company with about 1200 employees. Six hundred of them work in a sparkling 190,000-square foot headquarters near the Alewife MBTA station, where all the conference rooms are named for bands like the Beatles and the Allman Brothers, and there are instruments for after-work jam sessions in the first-floor café. These days, the firm focuses not just on tech trends affecting big companies, but new dynamics that impact their sales forces and marketing teams, too. Forrester had $292 million in revenue last year.

Colony says the firm relishes challenging conventional wisdom and "popping bubbles." Lately, that means talking about the decline of the web and the rise of the "App Internet," or smart software running on tablets, phones and other "client" devices that connect to the Internet, but make better use of the computer power on the device.

I sat down recently with Colony to talk about what the tech world around these parts looked like in the 1980s and 1990s; the dot-com shake-out, which rattled Forrester and its clients; robotic telepresence systems; Google Glass versus wrist-based wearables; what he expects from Apple; and how future mobile devices might make better use of built-in sensors to help do things like guide us to a hotel room and open the door.

Audio of my conversation with Colony, recorded June 21st, is below. It runs about 35 minutes. The company has some low-key anniversary celebrations planned for early next month.

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New edtech-oriented shared office, Exponential Techspace, up and running in Back Bay

Posted by Scott Kirsner June 5, 2013 08:00 AM

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Exponential Techspace isn't listed on the directory of the Park Square Building in Back Bay, the furniture isn't all assembled yet, and there isn't much on its website, but I dropped by yesterday to check out the new communal office geared to entrepreneurs working on education technology ventures. Exponential, the brainchild of parallel entrepreneur Hakan Satiroglu, is already home to a handful of startups, and as of next week, it'll house another seven businesses participating in the edtech-focused LearnLaunch accelerator program. LearnLaunch co-founder Marissa Lowman is also working out of Exponential.

"Nobody has really come out and done something like this for education before," says Satiroglu, right.

Exponential's office looks out across Berkeley Street at the headquarters of publisher Houghton-Mifflin Harcourt, and a few blocks away is the Boston office of Pearson, another major player in educational publishing. Several of Satiroglu's startups, including news site EdTech Times and Xlibrio, an online textbook store for schools, are now operating out of Exponential. So is Good Harbor Partners, a small merchant bank that works with publishers and edtech businesses. Not all the early tenants are connected to edtech, though: there's ZappRx, an e-health startup that connects doctors, patients, and pharmacists, and Wellable, which designs incentive programs to promote wellness.

Satiroglu says he hopes to attract visiting execs from the nearby textbook publishers, as well as educators from local schools and universities, for meetings and events at Exponential. The first one will likely be an open house planned for June 27th.

A dedicated desk for one person costs $350 a month; a cubicle that fits two people goes for $600 a month. The ninth floor space was formerly the Boston office of NAVTEQ, a provider of digital maps for GPS systems.

A few pics below:

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Boston's newest shoe startup, Category 5, finds a promotional opportunity at Figawi Race Weekend

Posted by Scott Kirsner May 28, 2013 07:45 AM

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Massachusetts is home to a closet full of big-name shoe brands, from New Balance to Reebok to Converse to Rockport. One of the state's newest shoe startups, Category 5 Boat Shoes, is still trying to achieve that kind of name recognition. So over the holiday weekend, the founders were schmoozing with the entrants in the annual Figawai sailing race from Hyannis to Nantucket. And the Framingham company presented a special-edition pair of boat shoes, pictured at right, to the winning skippers.

The shoes are made in the Dominican Republic, explains CEO and co-founder Jason Shuman. They can be embossed on the side (what footwear insiders call the "eye row") with logos of various college fraternities; outlines of islands like Nantucket and Martha's Vineyard; or an image the buyer uploads. They're priced at about $80, though customization adds $10 to the price.

Category 5 won the grand prize in this year's business plan competition at the University of Miami, where Shuman was a student. The startup's five founders all grew up together in Sudbury and Wayland.

The company is working on retail distribution for its shoes; they're sold at several outlets in Georgia and at Country Club Prep, an online retailer of all things preppy, but Shuman hopes to expand that to the Cape and Islands this summer.

Departing Zipcar CEO Scott Griffith signs up as CoachUp director

Posted by Scott Kirsner May 20, 2013 10:13 AM

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CoachUp founder Jordan Fliegel has been on a pretty hot signing streak when it comes to adding advisors and directors. Ex-U.S. Senator Scott Brown and Boston Bruins president Cam Neely are already involved with the Boston startup, which helps connect aspiring athletes with private coaches. And now Fliegel has persuaded Scott Griffith, the long-time Zipcar CEO, to join his board. (Zipcar went public before being acquired by Avis back in January.)

"There's a real mission orientation to this business, which is part of what attracted me," says Griffith, adding that he has been meeting with five or six companies a week as he starts to craft his post-Zipcar life. "Also, I have a 14-year old son who plays soccer, basketball, and baseball, so I understand the marketplace CoachUp is trying to create. Coaching right now is a cottage industry. There are concerns about safety, and competence, and who these people are, and that's what they're addressing." The site offers detailed profiles and reviews of each coach, and covers the lesson packages it sells with a $100,000 liability insurance policy. Fliegel says that over 7000 coaches are offering lessons through the site, and that California is the company's biggest market, followed by states like Texas, Florida, New York, and Georgia. The company has 15 employees, and has been hiring quickly. CoachUp launched last May, and was part of the TechStars Boston fall class in 2012.

Griffith tells me that his post-Zipcar plan isn't simply to jump on a bunch of startup boards and do some angel investing. "I've got another run with a company in me here," he says. But he's also interested in playing a role in the startup scene. "One thing I'm focused on is what can I do to make a more robust ecosystem here in Boston. We've come a good distance, but there's still lots of work that can be done."

Also advising CoachUp are Sheila Marcelo, CEO of Care.com, and Jumptap's chief product officer, Adam Soroca. "I look at Airbnb and Care.com and Zipcar as models," says Fliegel. "We want to be the next great consumer company in the U.S. We're going big."

Alternative medicine directory Jill's List acquired by California-based Mindbody

Posted by Scott Kirsner May 14, 2013 01:00 PM

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How's this for crazy timing?

Jill Shah had just sold her Back Bay startup, Jill's List, on April 15th. The money had just hit her bank account. She hadn't even had a chance to tell her seven employees about the sale yet when she heard two explosions nearby; Shah's company is located on Boylston Street, in between where the first and second bombs went off on Marathon Monday.

Shah's two kids had come into the office with their nanny to have lunch with her. "I had figured I would pull everyone together for a toast after lunch," she says. Instead, thinking that buildings nearby had been blown up, Shah, her kids, and her team evacuated their building at 726 Boylston and went home. "We weren't in the office for a week," she says.

Things have settled down considerably since Shah's somewhat atypical acquisition experience last month. She's now running the Boston office of Mindbody, a California company that sells web-based software to fitness studios, salons, and other wellness-oriented businesses to help them manage their businesses. Jill's List had created a network of more than 4,000 alternative medicine practitioners like acupuncturists and masseuses, and helped employees with flexible spending accounts or health savings account find the right practitioner for their needs, book appointments, and track payments. Employers pay a monthly fee to give their employees access to the Jill's List network.

Jill's List had created a partnership with Mindbody prior to the acquisition. "Their software helps practitioners run their businesses, and we've been trying to feed those practitioners into corporate America," Shah says. "We're also focused on ways to help doctors write orders for things like acupuncture or yoga as easily as they can write an order for a blood test or a CT scan."

"Our thesis is all about the convergence of healthcare and wellness," says Mindbody CEO Rick Stollmeyer, who is planning his first visit to the Boston office this Friday. Jill's List is the company's second acquisition so far; Shah will be senior vice president of what is being rebranded as the Mindbody Wellness Network. The acquisition price isn't being disclosed.

Shah started Jill's List in 2010, and never raised outside funding. She's married to Wayfair co-founder Niraj Shah, whose Back Bay e-commerce company has pursued a different funding strategy: it began as a bootstrapped business, but collected just over $200 million in outside capital last year.


Construction tour: Workbar's new shared office in Central Square, slated to open in late May

Posted by Scott Kirsner May 7, 2013 09:40 AM

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I stopped by the future home of Workbar in Central Square yesterday to get a look at the construction progress. The shared office space is scheduled to open by May 20th, according to founder Bill Jacobson, right. It'll be the second Workbar location; the original is in Boston, across the street from South Station. (That location is probably best-known as the home to Facebook's proto-outpost in Boston.)

Workbar offers memberships that start as low as $30 for a day pass, and go up to $2400 per month for a four-person private office. There are shared kitchens, copiers, and printers, as well as high-speed Internet access.

The new Cambridge location, on Prospect Street about a block from the Central Square T stop, will be much more visible than Workbar Boston, which is below street level. Cambridge has what Jacobson calls a "business-centric café space" at street level, which will feature cushy sofas, shared tables, whiteboards, a coffee bar, and digital signage that will show who's in the office today, as well as list upcoming events like workshops and mixers. A "welcomista" will be there to greet prospective Workbar members and show them around the space. On the mezzanine level, there's a glass-walled room that can be used for training sessions or private meetings. (The first-floor space used to house Crimson Hexagon, a social media monitoring startup that moved to Boston.)

workbarexterior.jpgWorkbar also has the complete top floor of the building, which Jacobson has carved up into three sections. "The Study" is an area for quiet "heads-down work," in his words. It has views of the Boston skyline. "The Commons" is an open area for teams working together. In the back of the building is "The Switchboard," where it's OK to make phone calls or conduct Skype videochats. (There are also private booths for phone calls there, and an area that will house a few treadmill workstations.) The top floor also has two small outdoor patios, and a kitchen that will have a communal table.

As is the case with the Boston location, Jacobson expects the denizens of Workbar Cambridge will be a mix of consultants and freelancers; early-stage startup companies; and individuals or teams from bigger companies that may not yet have local offices (Facebook is one example), or have offices in distant suburbs.

Jacobson says the first and fifth floor spaces are about 13,000 square feet in total. Analogue Studio of Boston worked on the interior design, and Anderson Porter of Cambridge was the project's architect. Here's a rendering of what the first floor will look like once completed. (Click to enlarge.)

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A few pics of the unfinished interior, and another rendering, are below.

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Terrafugia unveils TF-X concept vehicle: A plug-in hybrid that takes off like a helicopter and (almost) flies itself

Posted by Scott Kirsner May 6, 2013 11:00 AM

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Isn't there an old saying about learning to fly before you can fly?

If so, aviation startup Terrafugia is willfully disregarding it. The Woburn company is unveiling today a concept design for a future product called the TF-X — well before it has delivered its first product, the much-touted Transition "roadable aircraft." (Here's the Transition on "Good Morning America" last year.)

But in talking to Terrafugia CEO Carl Dietrich last Friday, he made it clear that the company looks at the TF-X as the kind of vehicle that could — big could — usher flying cars into the mainstream. It would be capable of taking off and landing vertically, outside of an airport. (Heliports or empty lots are fair game, as long as you have permission.) It would have "fly-by-wire" controls that would let you set your destination, and have the vehicle navigate to it with minimal pilot involvement. It'd be a plug-in hybrid outfitted with both batteries and an internal combustion engine, which would presumably make it more fuel efficient than most of today's "general aviation" (a/k/a private) aircraft. The TF-X would have a 500 mile range. And as with the Transition, if you encountered bad weather, rather than trying to fly through it, you would simply land at the nearest safe spot and drive the rest of the way to your destination, at highway speeds.

And if Terrafugia can somehow attain large enough production volumes, the TF-X might actually be a flying car that the middle class (OK, upper middle class) could afford. (Terrafugia anticipates the base price of its Transition will be $279,000, and in our conversation Dietrich expressed hopes that the TF-X would sell for less than that.) Dietrich acknowledges that getting the TF-X to the market will probably be at least an 8 to 10 year process, and require his company to do some major fundraising.

More concept images and a company-provided video are below, plus the audio of our conversation last Friday, which runs about 20 minutes.

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Highlights from today's Betaspring investor showcase: Companies to watch, new services to check out

Posted by Scott Kirsner April 29, 2013 01:28 PM

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Can a bus trip to Boston help startups from the Providence-based Betaspring accelerator program raise money?

That was the hope this morning, when fifteen startup teams headed north to pitch a roomful of Boston-area angels at the Cambridge Innovation Center; previously, interested investors had to hop on 95 South and head to Providence to get a look at the latest cohort of Betaspring graduates. Today's presenters were looking to raise anywhere from $175,000 to $2 million. It'll be a few weeks, at least, before we see whether the Greyhound strategy has an impact on the amount the entrepreneurs are able to raise. (At right is ZoomTilt founder Anna Callahan.)

Here are a few new services worth checking out, and startups worth putting on your radar screen. Companies in that second category, I'm betting, have pretty decent odds of collecting some cash — even if they're not working on consumer-facing ideas.

Check out...

• RaftOut, a site that makes it easy to coordinate concert ticket purchases among friends. Want to see a show, but don't know who else in your social circle will pony up to join you? Just click the "Bring People" button before you make a purchase. You can try it out with some upcoming shows in Boston here. The company is in the process of integrating with ticket sellers like Brown Paper Tickets and TicketFly.

• ShutterCal, which prompts you to pick the best picture you've taken each day. The company places these images onto an online calendar, which you can share with family or friends. You can try the service for free; purchase an ad-free, $3-a-month digital subscription; or buy a $14.99-a-month membership that sends you a packet of printed photos each month. You also get a nicely-designed shoebox (below) that holds a full year's worth of photos.

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As Boston government dawdles, founders of Sneakerbox retail truck plan to go west

Posted by Scott Kirsner April 10, 2013 02:31 PM

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I tweeted Angela Schipano, the co-founder of the Sneakerbox retail truck, recently to see when I might check it out somewhere around Boston. There aren't very many entrepreneurs using trucks to incubate new retail concepts, but I like to keep tabs on those who are.

"Actually, we are going to be relocating to California," replied Schipano. "Boston still does not have permits that allow us to sell."

The City of Boston, and city agencies like the Boston Redevelopment Authority, have been aware of and in discussions with retail truck entrepreneurs for more than a year. There have even been some small tests, like allowing trucks to sell their merchandise on City Hall Plaza around the holidays. But Schipano says that there's still no permitting process or pathway for retail truck entrepreneurs to find legal locations in the city to operate on a daily basis, unlike their food-peddling counterparts. And she asserts that police in Boston and surrounding cities often follow retail trucks' postings on Twitter as a way of finding out where they're operating, and then asking them to move or handing out expensive citations.

Schipano and her co-founder, Tiffany Crews, both went to college in Boston. They worked together at the Nike store on Newbury Street. Schipano lives in the North End. And they tried to start a business here.

"The thing that's great about a retail truck is that there's not a lot of overhead," she says. "You can open your own business — and that hasn't been easy for a lot of young people, given the recession we've been through." The eventual goal, Schipano adds, is to be successful enough to open a brick-and-mortar location, where they can showcase much more merchandise. (We've already seen that happen with food trucks like Clover Food Lab, which has two fixed locations, and another two set to open this spring.)

sneakerbox.pngBut Schipano says that she and Crews (pictured at left inside the truck) are planning to move to southern California next month. "There are maybe ten locations where you can sell street-side and it's legal, in places like Santa Monica and West Hollywood," she says. Permits vary in price — but they exist. (Sneakerbox's founders sampled the California scene earlier this year as part of a cross-country tour.)

I'd love to see Boston generating more revenue, supporting new entrepreneurs, and potentially cultivating future brick-and-mortar shops, by making retail trucks legal in designated spots around the city.

And at least some in city government are supportive of the idea. "We have to figure out how and where it can happen," Boston City Councilor Tito Jackson told me earlier this week. "I don't want innovation to be stunted based on regulation."

But that, right now, is where we're at.

"It really is a bummer," says Schipano. "Boston has so much potential. I wish it would've worked."

Update: Melina Schuler, a spokesperson for the Boston Redevelopment Authority, sent me this comment via e-mail:

We’ve developed several models for launching a retail truck program in Boston that are being currently vetted across city departments. Retail trucks are a new business model on the streets of Boston and any new policy that supports its presence on the public way must be carefully and thoughtfully crafted.

We’ve stayed in close contact with retail truck owners to keep the dialogue open and have held meetings with business leaders to understand potential impacts on existing retail.


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Harvard Square startup space Koa Labs is expanding to second location

Posted by Scott Kirsner April 1, 2013 02:50 PM

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Koa Labs is barely five months old, and already the shared workspace for entrepreneurs is adding a second location, just a block away from the first. The expansion will more than double the space Koa operates, says founder Andy Palmer, himself a serial entrepreneur and angel investor. In total, Koa will now be able to rent out more than fifty desks to entrepreneurs and investors. Desks cost $450 per month at Koa, which is the only co-working space currently operating in Harvard Square.

The new location, which just opened today, is at 66 Church Street, not far from the Brattle Theatre. Palmer is getting an assist with the expansion from the Experiment Fund, a Harvard-affiliated venture capital firm run by Hugo Van Vuuren. "We're both providing funding for the [new] space," says Palmer, who adds that the "goal of Koa is to just cover the costs of running the space with minimal overhead."

Among the tenants already based Koa are Data Tamer; Matter.io, focused on distributing content to 3D printers; and PushPage, which publishes a kind of Playboy interview updated for the social media age.

(Photo of the PushPage team at work provided by Koa.)

BookBub, Cambridge site promoting free and discounted e-books, approaches one million subscribers

Posted by Scott Kirsner March 15, 2013 08:30 AM
Closing in on one million subscribers is BookBub, an e-mail newsletter operated out of Cambridge. It's essentially a "daily deals" e-mail for avid readers, offering free or discounted downloads of what co-founder Josh Schanker calls "acclaimed books" in digital form.

And BookBub was only founded in January of last year.

Schanker says got the idea for BookBub from talking to a friend, Jennifer 8. Lee, who had started an e-book publishing company. "It seemed like publishers were looking for ways to build awareness for their titles and authors, and they wanted to spend money doing that, but no one was there to take their money," he says.

Readers sign up for the free BookBub newsletter, and specify the genres they're interested in. Each day, they get an e-mail touting three to five free or discounted e-books. Publishers and independent authors pay to be listed in the newsletter, though Schanker says there is some curation: "Everything that we feature is fundamentally an ad, but we reject more than half of the submissions sent to us." He says five of the largest book publishers are customers, along with "hundreds of independent authors."

Why do authors or publishers pay money to promote e-books they're giving away for free? "At the very basic level," Schanker explains, "it may be to get more exposure for themselves as an author, for the publisher, or maybe for a book series. Everyone is trying to build up an audience base."

The company has six employees in Kendall Square, but Schanker says they're about to post another another five or six job listings. Schanker previously started and sold two other local companies: Sombasa Media (acquired by About.com) and Sconex (acquired by Alloy Marketing & Media.). He and BookBub co-founder Nicholas Ciarelli have been bootstrapping the company so far, without outside funding.

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FlightCar invites you to park near the airport for free — and they'll rent your wheels while you're away

Posted by Scott Kirsner February 15, 2013 10:36 AM

Update: On April 15th, FlightCar announced that it had raised $5.5 million from a group of investors that included General Catalyst, Airbnb founder Brian Chesky, and "American Idol" host Ryan Seacrest.

Co-founder Shri Ganeshram tells me he is moving back to Cambridge this week, where the plans to begin recruiting additional employees; he hasn't yet figured out where FlightCar will be based. "We're looking to hire designers and software developers at the moment," he says. The startup participated in the Y Combinator accelerator program in Silicon Valley earlier this year.

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Here's an ideal that may appeal to some of you frequent travelers...

What if you could drive to the airport, hand your keys to a valet, get free parking for as long as you wanted, and have your car washed and cleaned. Oh, and you'd get a free gas card when you returned to pick it up?

A California start-up called FlightCar is testing the concept at San Francisco International Airport. There's just one catch: while they have your car, they rent it out to other travelers. It's a fascinating new twist on the car-sharing business model, which includes big companies like Cambridge-based ZipCar (now part of Avis) and smaller start-ups like RelayRides (founded in Cambridge by a Harvard Business School alum).

Co-founder Shri Ganeshram is taking time off from his undergrad studies at MIT to help launch the company; the three-person FlightCar team is now participating in the Y Combinator accelerator program for entrepreneurs.

Ganeshram tells me that the team noticed something basic about every major airport: there's usually one garage where departing travelers pay money to park, and another where arriving travelers pay money to rent a car. The founders — two of whom were high school students getting ready to head off to Harvard and Princeton — thought there might some synergy to be found in combining those two businesses. (Pictured above are founders Kevin Petrovic, Ganeshram, and Rujul Zaparde.)

Right now, they've rented a warehouse near SFO that can fit 30 or 40 cars, Ganeshram says. Departing travelers that have registered with the site can call FlightCar when they're driving to the airport, and they're met there by a valet. He takes the keys, makes notes about things like the gas level and mileage, and also snaps a few pictures to document the condition of the car. The company only accepts cars with fewer than 150,000 miles on them, and nothing made before 1999. "They have to be generally rentable," Ganeshram says. "We don't want cars that people would be embarrassed to drive around."

While you're gone, FlightCar tries to rent your wheels to arriving travelers. (A Volkswagen Toureg SUV rents for a quite reasonable $30 a day.) The company has $1 million in liability insurance, and comprehensive collision and theft coverage, so the owner's insurance "doesn't get involved at all," Ganeshram says. FlightCar's daily rental rate includes 90 miles; there's a 35 cents per mile charge after that, all of which goes to the vehicle's owner.

When you return from your trip, you call FlightCar again and they bring your vehicle back to the airport. Even though they've filled the tank to the level you left it at, you're given at least a $10 gas card (the amount can go up, depending on how new and nice your wheels are.) And even if the company hasn't managed to rent your car, the parking and valet service is still free.

"Instead of paying $18 a day for long-term parking somewhere, you might be able to buy an extra ticket and take a friend along with you," says Ganeshram. "And you get a cleaner car when you come back."

We'll see what happens to FlightCar when county and state tax authorities discover it. Ganeshram says that because FlightCar is a car-sharing service for members (similar to ZipCar), it shouldn't be subject to the same taxes levied on car rental companies. ZipCar managed to successfully use that argument, he points out. FlightCar intends to only collect sales tax, which Ganeshram says is included in the daily rates its web site displays. FlightCar charges a flat $30 a day for that Volkswagen SUV; by comparison, renting a BMW SUV from Avis at SFO for one day costs $210, $60 of which is taxes and surcharges.

If things go well in San Francisco, Ganeshram says the company plans to launch in a second city later this year. They're considering Boston, Los Angeles, and Seattle.

What do you think? Would you give it a try, either as a car owner or a renter?

Gemvara's chief experience officer, Brian Kalma, jumps to fashion startup Ministry of Supply

Posted by Scott Kirsner February 14, 2013 07:45 AM

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Brian Kalma's commute won't change much as of Monday: instead of heading to Gemvara, the online jewelry merchant headquartered across from South Station, he'll be reporting to Ministry of Supply, a men's apparel startup less than two blocks away in the Leather District.

Kalma, a well-known user experience (UX) guru, joined Gemvara only in October 2011, moving to Boston to help the customization-oriented site streamline the configuration and purchase process. He'd previously worked in New York for Gilt Groupe, the "flash sale" site, and for Zappos.com in Las Vegas. At Zappos, he spent seven years overseeing user experience, up to and just beyond the point the footwear purveyor was acquired by Amazon.

"I made a big move to come to Gemvara, and I'm very fond of what's going on here. The decision wasn't easy," Kalma told me earlier this week. Kalma had served as a mentor to the MIT-educated Ministry of Supply team last year, when the startup participated in the MassChallenge entrepreneurship competition. "I wanted to get back to the roots. I just had the burning desire to roll up my sleeves with something small and unproven. Hacking the apparel industry was appealing to me."

Kalma will be the sixth employee at Ministry, which raised more than $400,000 last year on Kickstarter for its Apollo dress shirt. The startup has been working to create a new men's apparel brand, based on a James Bond-like image and advanced materials that dissipate heat, resist odor, and don't wrinkle. I wrote about the company last July.

Kalma says that there aren't formal titles at Ministry, but that he will "spend the first phase of my time there tightening up the web experience and marketing." While he isn't a big wearer of dress shirts, Kalma says he is a fan of the company's Atmos v-necked t-shirt, which sells for $38.

I last covered Gemvara in November 2012, when co-founder Matt Lauzon stepped away from the CEO's role and became chairman; the company is still on the hunt for its next chief executive officer... and perhaps also a new chief experience officer, too.

Ovuline raises $1.4 million for apps and services that promote procreation

Posted by Scott Kirsner January 7, 2013 07:45 AM

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Cambridge startup Ovuline is pretty clear about its mission: "We make babies," founder Paris Wallace, right, likes to say. But while couples in days of yore relied on scented candles, oysters, or Al Green for help, in 2013 Ovuline is pitching an app and a web site to help the process along.

And the company, which graduated from the TechStars Boston program last fall, has just raised $1.4 from a group of investors including Lightbank, Cambridge-based Launch Capital, LionBird, and TechStars founder and CEO David Cohen.

Today, Ovuline sells a mobile app ($9.99) and access to a website ($30) that help women monitor their fertility, and supply advice about "what to do every day to maximize it," Wallace says. "We are finding our early users are getting pregnant two times faster than the national average." (The company also sells supplies like ovulation tests, fertility supplements, and basal thermometers.) Going forward, Wallace says, Ovuline is expanding its focus to "use the same data analytics and clinical guidelines to help women have a healthier pregnancy." Wallace talks about collecting data with devices like home blood pressure cuffs, scales, and pedometers.

"Right now, the standard of care is 10 to 14 doctor visits over the course of a pregnancy. But taking your blood pressure daily can be a way to spot problems like preeclampsia, which can threaten the health of the mother and the fetus," he says. "You can catch things early."

He talks about pregnancy as "one of the times when women radically change their health behavior. We are trying to take quantified self technology and apply it to a very specific time when people are motivated to change, and willing to engage."

The company has five full-time employees, and "we're going to be growing with this financing," Wallace says. Ovuline will be moving into Launch Capital's Harvard Square offices sometime later this month.


From the MassTLC Unconference: Advice on getting media coverage for your startup [Audio]

Posted by Scott Kirsner December 24, 2012 07:51 AM

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Been meaning to post this for a while... the audio from a session at last month's MassTLC Unconference that we called "Get Famous Fast: Media Relations for Entrepreneurs." Our goal was to capture advice from everyone in the room about how entrepreneurs can build relationships with reporters/bloggers/TV producers, and how to successfully pitch story ideas to them.

I served as ringmaster, and the speakers included:

- Gemvara founder Matt Lauzon
- Kate Castle, marketing VP at Flybridge Capital Partners
- Laura Fitton, inbound marketing evangelist at HubSpot
- David Meerman Scott, author of the books "Newsjacking" and "Marketing Lessons from the Grateful Dead"
- BzzAgent CEO Dave Balter
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Hitting the Series A wall: One Boston founder explains how it happened

Posted by Scott Kirsner December 10, 2012 02:54 PM
This week's Globe column focuses on the question of what will happen in 2013, as scads of startups that have raised a some early funding over the past few years attempt to raise a more substantial Series A venture capital round.

I was hunting for examples of local companies that have already hit the wall, and in the article I mention a few. But this morning, my inbox provided another example: Tasted Menu, a "social dining" site and mobile app that encouraged users to take pictures and post reviews of individual menu items they'd tried at restaurants. The e-mail went out to everyone who'd registered as a user of Tasted Menu, notifying them that it will shut down as of the end of this month. (I covered the Brookline company last year, when founder Alex Rosenfeld told me it had collected about $350,000 in capital. At that point, the company had five employees.) Like many startups, it was trying to attract a large base of users so that it could spool up a business model, like selling advertising or promoting restaurant special offers. And like many startups, it was trying to raise additional funding to stay alive — about $1 million.

I asked Rosenfeld what had transpired since we spoke. Here's what he said:

We came very close to raising our first institutional round this past summer, with a lead investor and term sheet in place, and a majority of the round raised. Unfortunately, the rest of the raise stalled out as consumer funding slowed with the fallout from the Facebook IPO. Out of cash, I had to part with the remaining team at the end of the summer, and have known since then that winding things down was a real possibility. It was nevertheless a tough decision. I'm very proud of what our team accomplished and really believe that, with a fraction of the funding of our competitors, we built as good a product as any in the restaurant dish recommendation space. It would have been great to have a shot at expanding nationally.

As I know you aim to cover things from a Boston angle, I will say that the challenge of fundraising in Boston as an early stage and particularly an early stage consumer/content start-up remained an obstacle for us. (Most of our angel money came from New York and the west coast, and of the committed capital for our Series Seed, not a dollar was out of Boston.) The irony is that Boston is actually a *great* place to launch consumer products, with its young, social, tech savvy population. It was also an excellent area to recruit consumer talent, especially for non-technical roles, which as a media guy I'm sure you appreciate as essential for content-driven businesses. I hope this incongruence lessens, but having been on the ground for the past three years, I saw a lot of promising talk but not enough progress.


Two planned 'EdTech' accelerators may be on the verge of a merger

Posted by Scott Kirsner December 5, 2012 09:51 AM

Update: The new accelerator program, LearnLaunchX, announced that it will begin in June 2013.

Any well-educated person could tell you that starting two accelerator programs in the same city in the same year, focusing on the same industry, might not be the brightest idea. So it's probably good news that two groups of entrepreneurs and investors that have been drawing up blueprints for two separate accelerators focused on the education market are in late-stage discussions about combining them.

One group has been calling its project Exponential Boston, and raising money to launch an inaugural program in mid-2013, aimed at helping education-focused entrepreneurs turn concepts into companies. The core team at Exponential includes EdTech entrepreneur Hakan Satiroglu; Boston University entrepreneurship czar Vinit Nijhawan; and Mark Miller, a banker who often works with EdTech companies.

Lowmanphoto1.jpgThe other group, LearnLaunch, just unveiled a new non-profit this week seeking to bring together EdTech entrepreneurs for conferences, demo nights, and networking. The accelerator program it has been cultivating seems somewhat more nascent than Exponential's, but it has been dubbed LearnLaunch Labs. The trio behind LearnLaunch are angel investor Jean Hammond; Marissa Lowman, right, founder of the monthly EdTechUp gatherings and formerly an executive at AisleBuyer, a mobile commerce startup; and Eileen Rudden, who served as a Chicago Public Schools official, and before that an executive at companies like Lotus and Avaya.

"Accelerators take funding and real estate," Hammond told me yesterday, "and it takes time to pull that together. We're also working on building the team that would run it."

Hammond also said that she was in conversations with Satiroglu and his group about combining efforts: "I don't know if there's room for two." But she and Satiroglu both said that they hadn't reached a decision yet. "Everybody is urging us to work together," Satiroglu said.

Satiroglu describes a six-month accelerator program that would provide $25,000 in seed funding, free office space, and in-kind services in return for a six percent chunk of each startup's equity. He says he has been scouting locations in the Back Bay; along with housing the accelerator participants, an Exponential office would also include a co-working area for other EdTech entrepreneurs and early-stage companies. Satiroglu already has some funding commitments to support Exponential Boston, but says that he'll focus more explicitly on raising money in January. He says his goal is to collect $2 million to $3 million to run an accelerator program for two or three years. The first cycle of the program could start in May or June, he says, and the Exponential site is already accepting applications.

Both groups talk about bringing in textbook publishers and online learning companies as partners, especially those with big Boston operations like Houghton-Mifflin and Cengage Learning. "One question for us is how close do you want to involve industry players as sponsors and mentors," Hammond says.

Satiroglu and Hammond both say that their objective is to create a stronger support system for EdTech entrepreneurs, helping them learn from one another and connect to universities, school systems, and teachers.

"My main goal is to establish Boston as the EdTech capital of the world," Satiroglu says. "I think we can own that domain."

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Cambridge bookstore, founded as an online/offline hybrid, takes to web to look for new owner

Posted by Scott Kirsner November 26, 2012 10:34 AM

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Lorem Ipsum Books isn't your typical used bookstore: the Inman Square shop was founded by MIT Media Lab grad Matt Mankins, as an off-shoot of his business selling used books online. "Rather than run from technology, we were going to embrace it to provide a new sales channel," Mankins recently wrote. Each book's price was set using software that searched the Internet to determine how rare or common it was, and factored in the book's condition. Mankins wrote the software himself, of course.

But nine years after Lorem Ipsum opened, Mankins now works in New York, as the chief technology officer for the company that publishes Inc. & Fast Company magazines. And the Cambridge bookstore, created as an attempt to get e-commerce and bricks-and-mortar to work together harmoniously, is losing money. (There have been earlier cash crunches, too.) Mankins tells me that he has never drawn a salary from the store, working various software-related day jobs over the years.

Over the weekend, Mankins posted a message to the Hacker News discussion forums announcing that Loreum Ipsum is for sale, and soliciting creative ideas about how to sustain a bookstore in the Age of Amazon. It has sparked 86 comments so far. The suggestions range from "sell the inventory and find another business to be in" to printing PhD theses, setting up an in-store café, or turning part of the store into a co-working space for freelancers and entrepreneurs. There are even a few respondents who seem interested in talking to Mankins about taking over Lorem Ipsum.

"I'm looking for someone to pick up the fight, to be an on-the-ground advocate proclaiming 'bookstores are here to stay…if we can change with the times,'" Mankins writes via e-mail. (He acknowledges that running the store from New York, where he has lived since 2009, may have contributed to its situation.) "Ideally I'd find an innovator who enjoys reading, understands the community benefits that bookstores provide, and isn't afraid to do things differently to nudge the store and the industry in different directions. I just started the process of looking in earnest. I don't really want to sell the store, but think it's the right thing for the store."

An excerpt of Mankins' Hacker News post is below.

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A look at the 13 startups presenting at today's TechStars Demo Day in Boston

Posted by Scott Kirsner November 14, 2012 09:30 AM

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Here's a look at the thirteen companies presenting today, starting around 4 p.m., at the Demo Day for TechStars Boston's fall program. The presentations take place at the Royale Boston nightclub in front of an audience of investors, but there's an after-party starting at 9 p.m. that's open to anyone. DJing the party are Monster.com founder Jeff Taylor and Acquia co-founder Jay Batson.

I've listed the company name below, the founder or CEO who'll be presenting today, and a brief description. When companies are based somewhere other than Boston, I've listed that in parentheses. (At right are Fashion Project co-founders Christine Rizk and Anna Palmer.)

You can view tweets about the event by watching the hash tag "TSDemoDay."

• BetterFit Technologies
Julia Winn
Gathering data and building predictive software to understand which drug — for instance, a birth control pill or an anti-depressant — may be most effective for an individual patient, with the fewest side effects. Previously participated in Highland Capital's Summer@Highland program.

• Careport Health
Lissy Hu
Helping find the right services and facilities for patients who have just been discharged from the hospital.

• CoachUp
Jordan Fliegel
Building a marketplace for private sports coaches. CoachUp raised some money last month at a "Shark Tank" pitch event, and I covered them earlier this year. The company also participated in MassChallenge this year.

• Dashbell
Paige Brown
A reservation system for independent hotels, delivered over the web, to help them fill more of their rooms.

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Looking ahead to tomorrow's Betaspring Launch Day, when 13 startups will strut their stuff

Posted by Scott Kirsner November 7, 2012 07:30 AM

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Seeing startups present at the conclusion of accelerator programs and trying to divine their potential is a bit like meeting a toddler and trying to figure out what kind of grades she'll get in college. It's just really early, and all of the fledgling startups seem so fresh-faced, energetic, and full of potential.

That's what was on my mind on Monday evening, when I got an early look at the thirteen companies that will present in Providence tomorrow as part of Betaspring's fall "Launch Day." (A group of investors saw the company's present Tuesday morning.)

Betaspring essentially doubled in size this year, by accepting a spring and fall cohort of entrepreneurs. Here's what the fall group is up to. I've starred the ones I think are most likely to succeed, and offered an explanation in bold as to why. Just my opinion — and I hope a few of the non-starred ones keep me humble by proving me totally wrong. (In the photo above is Kirsten Lambertsen of Kuratur, which collects social media posts and transforms them into nicely-designed "web magazines.")

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The newest ride in Uber's Boston fleet

Posted by Scott Kirsner November 5, 2012 09:55 AM
My curiosity was piqued this weekend when I saw entrepreneur (and Harvard College senior) Peter Boyce tweet about getting a ride in a Porsche, using the transportation app Uber. "Lucky to have taken the first @Uber_BOS @Porsche tonight | Gotta love this service," he wrote.

Was that a joke? Most Uber cars I've ridden in in Boston have been black Cadillacs, Lincolns, and other comfy-but-nondescript sedans.

I called up Uber Boston general manager Michael Pao this morning, and he confirmed that, yes, a livery driver had signed up to be part of Uber's virtual fleet last week, with a black Porsche Cayenne. (Pao told me the driver's name is Adam, but didn't have his last name readily available.)

He sent the pic below as evidence, and told me that the Porsche shows up as a normal black car on the Uber app, at normal black car rates. You can't make a special request, in other words — you just get lucky. Pao also mentioned that a driver with a Mercedes GL 550 would soon start roaming the streets of Boston, and said that as more of these high-end cars hit the road with Uber, the company might create a separate class for them — right now, the two options are "black" or "taxi" — and charge higher rates.

Are you feeling lucky, Uber riders?

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In a former textile mill in New Hampshire, Walt Siegl cranks out custom motorcycles

Posted by Scott Kirsner October 30, 2012 12:20 PM

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One of the things I enjoy most is discovering new businesses that are growing inside old New England mill buildings. So when I heard about a guy named Walt Siegl who was building custom motorcycles in Harrisville, New Hampshire, I made a point to stop by.

Siegl is a former Austrian cultural attache (and long-time motorcycle racer) who came to Harrisville from New York five years ago. "It's always a jump in the cold water when you start your own business, especially after my career in the foreign service, where there are safety nets built into the job," he says. He'd already been building bikes as a sideline, but when he came to New Hampshire, he committed to doing it full-time. "I felt confident that since I was doing something that I was good at and loved to do, everything would work out," he says.

He makes about four custom bikes a year, designing the bodies himself, and typically relying on upgraded Ducati and Harley engines. Prices are $50,000 and up, though Siegl tells me he is doing a limited-edition run of about eight bikes, "The Walt Siegl Superlight," that will be priced at $30,000. His workshop, in the ground level of an 1860s-era textile mill, used to be the mill's machine shop, and it's filled with welding gear, drill presses, milling machines, and work tables.

When I visited last month, Siegl was finishing up a bike that had been commissioned by Puma for display in its stores. He's also working on a line of shoes, out in 2013, for Puma, and a leather racing jacket in collaboration with Puma and Fall River-based Vanson Leathers.

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Talking with Y Combinator founder Paul Graham [Audio]

Posted by Scott Kirsner October 26, 2012 03:31 PM

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While in the Bay Area earlier this month, I had a chance to sit down with Y Combinator founder Paul Graham.

Founded in Cambridge in 2005, Y Combinator created a new model for investing in "classes" of promising startups, and offering guidance and mentorship to help increase their chances of success. The program now operates out of Mountain View, and included 84 startups in its most recent cohort. Y Combinator's alumni include Airbnb, Reddit, Omgpop, Disqus, WePay, Hipmunk, and Dropbox. (Those last three were founded by entrepreneurs who went to school in the Boston area.) Graham is also the author of a thoughtful series of essays on entrepreneurship.

We chatted for about a half hour on the outdoor patio at Coupa Cafe in Palo Alto; that explains the background noise. Among the topics we covered:

- What role Graham sees himself, and Y Combinator, playing in the Valley
- Whether there is a limit to how big Y Combinator can get - The profusion of other accelerator programs for startups
- Which Y Combinator alumni haven't gotten the attention they deserve, in Graham's view
- Kickstarter as a fundraising mechanism for startups
- His experiment with letting entrepreneurs into Y Combinator, even if they didn't yet have an idea for a startup
- The relative health of the startup ecosystem in New York and Boston
- The "demo day" at which Dropbox presented
- His decision to stop holding the Y Combinator summer program in Cambridge, and operate in Mountain View year-round
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Top 10 startup needs, according to AngelList

Posted by Scott Kirsner October 24, 2012 11:49 AM

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Visiting AngelList HQ in San Francisco earlier this month, founder Naval Ravikant shared some interesting survey data that the site has been collecting -- but hasn't previously published.

Ravikant explains that the survey is being used to help his team at AngelList figure out what new features to build. The top needs that startups have, he says, are funding, engineers, and designers, "which is why we have specific products for each of those (angel.co/talent, for example.)"

So what do startups say their other most-pressing needs are?

Here's the top ten list:

1. Advisors
2. Press
3. Social media marketing
4. Co-founders
5. Board members
6. Salespeople
7. PR firms
8. Office space
9. Lawyers
10. Accountants

Meet Rue La La's most familiar face: Lauren Fitzgerald

Posted by Scott Kirsner October 19, 2012 08:12 AM

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Lauren Fitzgerald may have the glammest gig in Boston's innovation economy: modeling for the "flash sale" company Rue La La, which runs time-limited sales of high-end merchandise via its web site and mobile app. Fitzgerald's an independent contractor, but she typically shows up at Rue for day-long photo shoots 2 to 4 days a week. "I'm at Rue for about 60 to 70 percent of my jobs," she says. "It's the most consistent client I have."

When Fitzgerald first showed up to work for Rue in the spring of 2008, just after the site had launched, she didn't know much about the company. "My agency asked me to go down and meet with them," she says. "At that point, you didn't really have anything to compare it to. Flash sales were just getting started. I got a password, became a member, and I felt very elite."

Since then, Fitzgerald has become a familiar face to the six million shoppers who receive Rue's daily e-mail, or access its mobile apps, to see what's on sale today. When we spoke on Wednesday, she was doing a shoot for Lilla P, a Manhattan-based label, and she'd also recently modeled apparel from French Connection, Kay Unger, and Narcisso Rodriguez. A day of work at Rue typically starts at 8 a.m. with hair and make-up -- "which is a really nice way for a girl to start the day," she says -- and lasts until about 4 p.m. "Typically, you're doing one brand a day," Fitzgerald says, and there are three or four models simultaneously at work in the company's photo studios.

For a city like Boston, which isn't home to many fashion magazines or major retailers, Rue has been "heaven-sent," creating lots of additional work for models that doesn't require them to travel. And she's a true local, having grown up in Medford.

Fitzgerald says she's often a Rue customer herself, though she doesn't get a first crack at merchandise or an insider discount. "The one advantage I have is that I get to try on the clothes first," she says. "And there have been quite a few days when something shows up on the site at 11 a.m. and I'm there waiting to buy it."

Rue La La is 30 percent owned by the auction giant eBay, which recently started showcasing some Rue merchandise on its site.

A few examples of Fitzgerald's work for Rue La La are below:


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Johnny Appleseed of low-maintenance grass seed heading to Wellesley

Posted by Scott Kirsner September 19, 2012 02:11 PM

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Grass guru Jackson Madnick has been calling me every few weeks from his never-ending world tour to promote Pearl's Premium lawn seed. His goal? To remind me that fall (not spring) is actually the best time to start a lawn.

Wayland-based Pearl's developed its own breeds of seeds for low-maintenance lawns, which don't require as much water or mowing as typical seeds. In 2010, the company took one of the top prizes at the inaugural MassChallenge startup competition.

Madnick tells me that Logan Airport has been using Pearl's, and that a 662-year old castle in England, right, has been relying on the seed to grow lawns in areas previously considered too shady for grass. (Madnick adds that Langley Castle Hotel happens to be owned by his brother, Stuart Madnick, a professor at MIT's Sloan School of Management.)

MadnickJackson.jpegMadnick, left, says the company's most recent distribution deal is with Home Depot in the Chicago area (it can also be found in Whole Foods Markets throughout New England, along with Mahoney's Garden Centers.) The company has been supported so far by investments from friends and family, but Madnick says they're hunting for additional funding.

Madnick's tour of the U.S. (he's in Omaha, Nebraska today) brings him to the Wellesley Public Library on the evening of October 3rd, for a talk on "Green Home, Health and Lawn."

After hundreds of miles pedaling around Boston, two Wentworth grads reinvent the pedicab

Posted by Scott Kirsner September 4, 2012 07:45 AM

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As riders for Boston Pedicab, John Pelkey and Eric Crouch have ferried passengers from Fenway Park out to Brookline, from the North End to the Garden, and all around the waterfront. And they couldn't help but start making a mental list of some of the flaws they noticed in the vehicles they pedaled: fiberglass elements that cracked easily, chains that slipped and ground as they changed gears, spokes that broke. And, of course, the vehicles' weight: about 175 pounds. At times, they hauled three adults in the back, or two adults and two kids.

They turned their observations in to a senior thesis project at Wentworth Institute of Technology, building a prototype pedicab, and went on to win the top prize of $10,000 in the university's very first Accelerate Innovation and Entrepreneurship Challenge this summer. And now Pelkey and Crouch are talking to owners of pedicab fleets about placing orders for their new vehicle, which still doesn't have a name. (Pelkey is on the right in the photo.)

pedicab-test.jpgI got to take it for a spin last week at Brigham Circle, with Crouch as my passenger. It was surprisingly maneuverable, and the gear shifting was so smooth it was imperceptible. (The prototype uses a continuously-variable planetary transmission made by NuVinci.) I was ready to start picking up fares and carting them around town — or at least around the big plaza in front of JP Licks.

"We realized that these are horrible products, and we thought we could do better," says Pelkey. "We wanted to design a pedicab that was more reliable, easier to maintain, and lighter weight." They relied on their own experiences, and also talked to mechanics at Boston Pedicab about what broke most often. Instead of a fiberglass passenger area prone to cracking, they use fabric wrapped around lightweight aluminum tubing. They created a step to make it easier for passengers to get in and out, and added extra legroom for passengers. (See photo below.) They specced out a "lefty" hub for the rear wheels, intended to be only supported from one side and less likely to break.

pedicab-step.jpg"We designed this pedicab for Boston," Pelkey says. "If a cab works year-round in Boston, it'll work anywhere."

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Catering site Phoodeez debuts in Boston, seeking to simplify the task of feeding big groups

Posted by Scott Kirsner August 29, 2012 08:52 AM

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At club meetings and conferences on the MIT campus, Sal Lupoli and Christine Marcus kept seeing the same burritos and pizzas get ordered to feed groups of students. And afterward, they kept seeing major amounts of left-overs get given away or tossed.

"What we noticed is that the person arranging food for a meeting usually had a collection of menus, they ordered from the same few places that they knew they could rely on, and they never knew how much to order so they usually over-spent," says Marcus, a former U.S. Department of Energy official who recently earned her MBA at MIT's Sloan School of Management. Lupoli adds, "And there are no Yelp reviews for catering that tell you about the food or about the service, like whether it'll show up on time." Lupoli, also a newly-minted MBA, is the co-founder of Sal's Pizza and Salvatore's Italian Restaurants, with about 50 locations in Massachusetts and New Hampshire. (Lupoli is pictured below.)

sal2-184x300.jpegEarlier this year, they began testing their website Phoodeez with MIT users. It's intended to streamline the process of ordering food for groups, and help "local restaurants that have great food attract more business in catering, which is very lucrative," in Lupoli's words. (Yes, his pizza shops and higher-end Italian restaurants are featured on the site, along with several other suppliers.) This week, Phoodeez is launching a redesigned site and targeting off-campus customers in the broader Boston area.

Restaurants participating in the site so far include Guru the Caterer, Spice and Rice, and Aceituna. Every item listed, liked the "good morning breakfast" pictured above, from the Danish Pastry House, explains how many people it feeds. Prices are the same as if you'd ordered directly from the restaurant, Marcus says, but Phoodeez takes a small referral fee off the total amount.

The new site will compete against other online food-ordering businesses like Seamless and Foodler. Marcus says they are considering a Kickstarter campaign to raise money for marketing and promotion. But so far, she says, "we are doing it the very old-fashioned way, having raised the initial funds from friends and family, as well as from revenue."

The company has been using office space at MIT's Beehive Cooperative and Harvard's Innovation Lab.

Compostable bed sheets: A godsend for college students who loathe doing laundry?

Posted by Scott Kirsner August 16, 2012 08:00 AM

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College students can find time for all sorts of activities, licit and otherwise. But one chore that always seems to drop off the bottom of their to-do list is washing the sheets.

Two Hingham entrepreneurs have come up with a solution: linens made out of a fiber derived from Eucalyptus trees (it's called Tencel) which you can simply toss into a compost bin or trash can when they're dirty. The sheets from their startup, Beantown Bedding, are both compostable and biodegradable. A set that includes a fitted sheet, flat sheet, and pillowcase costs $25. (So far, they're only selling twin extra-long sheets, which is a bed size common on college campuses. And the sheets are only available in white.)

"We met when our kids started dating," explains Kirsten Lambert (she's on the left in the photo, with co-founder Joan Ripple.) "Then they went off to college, and we found that they basically never washed their sheets."

"We joked about sending them a roll of paper like you see on the exam table of a doctor's office — but comfortable," says Ripple. They started developing the concept of disposable sheets last year, got their first wholesale orders at a trade show in March, and received their first inventory in June. Tencel is used to make some brands of baby wipes and clothing, but Beantown's founders believe they're the first to be using it for linens.

Lambert and Ripple say that many parents already throw away sheets after a summer of camp, or a semester of college, and contend that sheets that can be composted (or at least biodegrade in a landfill) will have a lesser environmental impact. (That may be true, but those who choose to wash their traditional cotton sheets use about 40 gallons of water each time, according to the Environmental Protection Agency, while it requires about 150 gallons of water to make a pound of Tencel fiber. The manufacturing process for cotton sheets can use as little as 10 gallons of water per pound, according to the Natural Resources Defense Council.)

I asked Heather Henriksen, director of the office of sustainability at Harvard University, what she thought of the concept of compostable sheets. She said she thought it might have merits in places where there isn't sufficient water to regularly wash linens, like a disaster relief camp. But on a college campus, she suggested that using a washing machine or laundry service is still better. She wrote via e-mail, "I think the most important R in the 3R's (reduce, reuse, recycle) is of course, reduce — do not create the waste in the first place."

The sheets from Beantown are intended to last about a month. "After that, they start to pill and look worn," says Lambert. In addition to summer camps and colleges, Beantown is also marketing its compostable sheets for vacation house rentals. Right now, Beantown's products are being produced in China, but the founders say they're hoping to find a domestic factory.

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Why shutting down Uber is a bad idea for Cambridge, the Commonwealth, and consumers

Posted by Scott Kirsner August 14, 2012 09:56 PM

Update: On Wednesday, August 15th, after hundreds of Uber supporters signed an online petition and thousands voiced their displeasure via e-mail and Twitter, one of Governor Deval Patrick's communications staffers tweeted that the state was "working on a swift resolution" (and acknowledged that he'd used the service just the night before.) Later that day, Massachusetts' Division of Standards reversed its earlier position, allowing Uber to continue operating.

Update #2: In September, the City of Cambridge sued to overturn the state's ruling on Uber.


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I'm a big fan of Uber, the car service that you can summon using an iPhone app. (I reviewed it here last October, just as it was launching.) So I was troubled to learn that the City of Cambridge and the Massachusetts Division of Standards want to shut down the service, contending that it is illegally using iPhones to calculate the fees it charges riders.

Here's why I think they're doing the wrong thing.

We live in a city with too few taxis, which happen to charge the highest rates in the entire U.S. In many parts of the greater Boston area (like Cambridge), you can't be guaranteed that a cab will accept credit cards. So Uber, a San Francisco company that makes town cars available at a higher price than taxis, but a lower cost than traditional car services, provides a really beneficial service for city-dwellers and tourists. I've used it many times when I needed a lift in a neighborhood with no taxis or cab stands, or when I wanted a more spacious vehicle to take me to the airport. (Many of Uber's fans are women, who tell me that they occasionally are refused rides by taxis late at night if, for instance, they're trying to travel from Somerville to Boston.) Every Uber driver I've met so far — about a half-dozen now — has been courteous. They're all licensed livery drivers, working as independent operators or as part of a small livery company, according to Uber. And they all seem to like being part of the Uber network, which generates additional income for them when they otherwise wouldn't be busy.

Uber is totally transparent about how its pricing works. Customers receive an e-mailed receipt almost immediately after your ride is over, complete with a map of the ride. (There's never any issue with illegible receipts, or receipt printers that have run out of paper.) You also have an opportunity to rate your driver on a 1-5 star scale.

The core of the argument that the City of Cambridge and the Commonwealth of Massachusetts are making against Uber is that an iPhone is not an "approved device" for use in a commercial transaction — in this case, tracking where a trip starts and ends, calculating the fare, and billing the rider's credit card. (Some of that process involves Uber's servers, communicating with the iPhone.) So essentially, if I were an independent livery driver and you asked me to take you from Wellesley to Logan Airport, I could pull a number out of thin air and say "$80," but it's not legal for me to use an "unapproved" iPhone to figure the fare. (See if you can explain to me how Boston Coach comes up with its fares, which are more than twice as expensive as Uber's.) Who decides which devices are kosher for use in Massachusetts and which are not? Only the National Conference on Weights and Measures, which is apparently not yet aware of GPS-enabled smart phones.

Uber, for its part, believes that it is operating legally in Massachusetts, and Uber CEO Travis Kalanick told me earlier today that the Commonwealth shouldn't be trying to prevent his company from doing business here, given that no standards exist yet for using an iPhone's GPS system for fare calculation. "They can't enforce standards that don't exist," he said, adding that Uber's approach to calculating the distance traveled is "very accurate."

Incidentally, I also asked Kalatnick whether it was a consumer complaint that spurred the City of Cambridge's recent investigation into Uber. "No," he said, declining to elaborate on who might have prodded the city into investigating. Do you have any guesses?

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Upstart announces a new way to invest — yes, actually invest — in a recent college grad

Posted by Scott Kirsner August 8, 2012 09:00 AM

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A new Silicon Valley company called Upstart launches today, with plans to make it possible for individuals to invest in the future success of a recent college grad — and potentially earn a return as their career takes off.

Upstart's founder is a Massachusetts native, former Google executive Dave Girouard, right, and one of his founding board members is Cambridge entrepreneur and angel investor Andy Palmer. The company's initial funding — $1.75 million — comes from Google Ventures, New Enterprise Associates, and Kleiner Perkins.

Here's how it will work: anyone wrapping up their undergraduate or graduate studies this spring at Upstart's five launch schools can create a profile on the site. (People who graduated in 2010 or later are also eligible.) They might be looking to raise money so that they can work on a startup, make an independent film, travel with an eye toward starting a non-profit, or begin a career as an artist. Similar to Kickstarter, other individuals can decide to put money toward their fundraising goal. But unlike that site, the recent grads who take the money must repay their backers a share of their income — no more than 7 percent, and over no more than 15 years of working. In years when they earn less than $30,000, they pay nothing. And the profit upside tops out at a 14.99 percent annual return to backers. (To fund its operations, Upstart will keep a 3 percent slice of the money invested in recent grads, and a 1.5 percent slice of the money returned to investors.)

Upstart is working with just five schools to start with, to "make sure the agreements are right, and that we have sufficient backers, and that the right processes are in place," Girouard says. The group includes Dartmouth College and the Rhode Island School of Design. And among the first group of students is Nathan Sharp, a 2012 graduate of Dartmouth's Tuck School of Business; he's working to launch the online shopping start-up PayOrPass. Sharp will be using the money he raises from Upstart to pay off the debt he racked up while earning his MBA, so that he can focus on the new venture.

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Future Boston Alliance announces 25 entrepreneurs participating it its inaugural accelerator program

Posted by Scott Kirsner August 1, 2012 06:07 PM

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The Future Boston Alliance, a non-profit focused on improving the creative and entrepreneurial ecosystem in Boston, just sent over the list of the 25 businesses and non-profits that have been picked to participate in its new accelerator program.

The program starts on August 11th, and runs every Saturday for six months. Participants are matched with mentors, who will take them to at least one networking event, says Malia Lazu, the group's director. Among the entrepreneurs who'll run workshops for the participants are Avid Technology founder Bill Warner and Alec Stern, a founder of Constant Contact. At the end, one winner will get a year of free office space in the Back Bay (at the headquarters of Karmaloop, whose CEO helped form the alliance), along with at least $5,000 in cash. Lazu says she's still trying to increase that prize purse.

Here are the ventures, along with descriptions supplied by their founders:

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14 new startup ideas from the Babson Summer Venture Program demo day

Posted by Scott Kirsner July 26, 2012 04:45 PM

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Babson College held its Summer Venture Program "demo day" this afternoon, showcasing 14 startup ideas that students have been working on for the last two-and-a-half months. The teams come not just from Babson, but also Olin College and Wellesley.

Here's a quick run-down, along with the four concepts I liked best.

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Facebook marketing specialist Brand Networks expands to New York and LA

Posted by Scott Kirsner July 10, 2012 07:45 AM

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As big companies try to figure out how to connect with customers on Facebook, a five-year old Boston marketing agency is reaping the benefits.

Brand Networks, founded by a veteran of the ad agency Arnold Worldwide, is announcing this week that it is expanding new outposts in New York and Los Angeles, in addition to its Boston headquarters and a technology operation in Rochester, New York. The firm has 65 employees and is continuing to hire engineers, account managers, and social media strategists.

"Being in New York is obvious for us, since there's so much business there from agencies and big brands," says CEO Jamie Tedford, adding that Brand Networks already counts American Express and General Electric, both headquartered in Manhattan, as clients. "In LA, our main focus is the entertainment industry, and we've done some work with Sony Pictures, Paramount, and other studios. But they want their partners to have a local presence." New York is now six people, including former Facebook marketing director Sean Mahoney. The sole employee thus far in Los Angeles is Paul Falzone.

Locally, Brand Networks works with clients like Monster.com and Puma; its national clients include Wal-Mart and JetBlue. Tedford says that Brand Networks is one of only eight companies that have been awarded three badges as part of Facebook's "Preferred Marketing Developer" program, for creating Facebook apps, helping clients manage Facebook pages, and running Facebook ad campaigns. (The fourth badge that Facebook gives out is called "Insights," for measuring and tracking the activity taking place around a brand on Facebook.)

"From the very beginning, we were pretty clear that our goal was to help brands activate consumers on social networks," Tedford says. "After we built our first app on Facebook for Puma in 2007, we realized that this was a really powerful platform."

New co-working space opens in Allston, with special focus on minority and non-tech entrepreneurs

Posted by Scott Kirsner July 9, 2012 12:57 PM

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Today is opening day at Startup BLVD Allston, a new co-working space near Harvard Avenue and the Mass Pike. The space is a real-world project of Startup BLVD, which operates an online match-making and consulting service that helps connect start-ups, larger companies, and municipal governments. At about 3,000 square feet, the new shared office will fit 45 to 50 desks, says Nathan Spencer, an entrepreneur who is helping to market the new space.

"A lot of the existing co-working spaces seem to be serving a limited sliver of the startup community," says Spencer, whose company wants to help transit systems sell advertising on the back of riders' passes. "They have tech or mobile companies as tenants." Startup BLVD Allston hopes to attract a broader range of entrepreneurial ventures, including retail and service-based businesses.

And, adds Enrique Shadah, the founder of Startup BLVD, it will also actively seek to attract minority entrepreneurs. "I am Latino and have a solid connection to the Latino community in Boston," Shadah writes via e-mail. "Also, I sit on the Entrepreneurship Committee of the newly-created New Americans Alliance Institute. We are also connected to New England's Minority Supplier Diversity Council and the state's Supplier Diversity Office."

"Our goal is to connect to all of these channels and ask them to invite their constituencies to join our community," Shadah explains. "Being located in Allston is helpful, because there is a large population of immigrants and minorities." The Startup BLVD Allston space is on Linden Street, not far from the Pizzeria Regina on the Mass Pike, and a short distance from Harvard Square.

A membership that offers access to the new space — including snacks, coffee, conference rooms, and business-class Internet — costs $150 a month, but renting a dedicated desk starts at $400 a month. (A photo of a dedicated desk, in which you can store your stuff, is above.) That's a good bit cheaper than Workbar, a co-working space located near South Station, where dedicated desks go for $500 a month.

"We think this can be a place that benefits both the community and the businesses themselves," says Spencer.

Fashion Project wants to make donated couture work harder for charity

Posted by Scott Kirsner July 5, 2012 10:00 AM

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When second-hand jeans made by the Gap and Roberto Cavalli wind up next to each other on a thrift store rack, it's a good bet that the Cavalli's — which can retail for north of $1000 — may not fetch their optimal price. That's the simple premise behind Fashion Project, a new Boston-based site that collects and then sells donated high-end apparel and accessories from brands like Nanette Lepore, Armani, and Yves Saint Laurent. The sales help support charities like Dress for Success and the March of Dimes, and the donations are tax deductible.

"Not every charity runs its own thrift stores, and the ones that do can get more value for an item by selling it through us," says Christine Rizk, Fashion Project's co-founder and chief operating officer. (She's on the right, with CEO Anna Palmer on the left.) "We tell people that we want stuff that would re-sell for $40 or more, and on the web site, we list some sample brands. About 80 percent of the stuff we get is sellable."

Non-profits can sign up on the site to have their supporters send in merchandise. And individuals can request a postage-paid donation bag to be sent to their house, fill it with items, and designate a charity that will benefit from their sale. (Donors get a tax receipt directly from the charity.) Both non-profits and individuals can see a tally of how much they've raised on Fashion Project. "Your closet can make a huge impact," Palmer says.

The site has collected about $17,000 in inventory already, though today it only features women's apparel and accessories. Palmer says they'll add men's merch eventually. Fashion Project takes 40 percent of the sale price, and passes along 60 percent to the charity.

Rizk and Palmer met while earning their law degrees at Harvard; they both graduated in 2011. Working alongside them as Fashion Project's chief marketing officer is fashion and social media maven Michelle McCormack, who organizes the annual Fashion's Night Out event. The company has five employees, and offices in the Leather District. Fashion Project has raised $200,000 so far from individual angels, and the founders hope to raise another $200,000 to $250,000 later this year. They're planning a promotion this summer that would encourage Bostonians to donate to the site in exchange for getting a discount on new merchandise at numerous Newbury Street retailers.

(In the photo, Palmer is wearing a jacket from Emporio Armani and holding a Kate Spade clutch; Rizk is wearing a dress by Diane von Furstenberg.)

Startup perceptions survey: Work, love, and money

Posted by Scott Kirsner June 12, 2012 10:42 AM
The folks at Bing sent along the infographic below. It's based on a survey that the Boston-based marketing network CampusLive conducted in April of 700 college students, and 100 adults working at startups.

Some interesting tidbits: 7 percent of students think working at a startup "makes me sexier"; 22 percent say their romantic partner "puts up with a lot." Fifty-two percent of students are interested in startups. Forty-eight percent of students say that more money — presumably funding — would encourage more students to devote themselves to startups.

And among adults, 38 percent say they started their venture "based on a crazy idea they had while in college." Twenty-three percent eat at least seven meals at their desk every week. Yikes...

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(I edited the above graphic to eliminate some data points I found less relevant, like how many cups of coffee students drink per day and how much sleep they get. Here's the full version.)

An open letter to Mayor Menino on pop-up shops, mobile retail trucks, and the Oakland experiment

Posted by Scott Kirsner May 29, 2012 11:37 AM
Dear Mayor Menino:

I know you've been meeting with entrepreneurs who've created mobile retail trucks, to consider establishing new parking spots in Boston where they could legally sell their wares. I'm all for that. A few well-chosen spots around the city could help fledgling retail concepts gain momentum — and potentially move into permanent storefronts if they're successful enough — without aggravating merchants who pay rent.

But mobile retail won't work for every business, since you can't fit very much merchandise or very many shoppers into a rehabbed FedEx truck. Already, I know of at least one business, bGreen, that tried and failed to sell eco-friendly home products out of a truck. (The founders are now trying to get rid of the truck, and instead focus on their web site.)

There's another model worth considering that could have even more of a positive impact, for the city and for entrepreneurs: encouraging landlords to make vacant stores available to entrepreneurs who want to run pop-up shops. These businesses would help invigorate neighborhoods that have too many empty storefronts (think Downtown Crossing or Dudley Square), and they could help entrepreneurs test retail ideas with fewer up-front expenditures than outfitting a truck.

The city could dangle some incentives for landlords in specific neighborhoods to give this a whirl — perhaps a break on real estate taxes. Or it could just invest some time and resources in helping to promote the idea and the shops themselves. For landlords, there are several benefits: pop-up shops using a storefront for a few months may become successful enough to turn into permanent tenants, but even if they don't, they can help increase foot traffic to their location, making it more appealing to other prospective renters.

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TurningArt, Boston startup that rents and sells original art, adds $1.5 million in new funding

Posted by Scott Kirsner May 23, 2012 08:00 AM

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Boston startup TurningArt is announcing today that it has raised an additional $1.5 million in funding. The round includes NextView Ventures, a VC firm that happens to be based in the same Leather District building as TurningArt.

The company operates a subscription service, starting at $10 a month, that sends you new prints to hang in a company-supplied frame whenever you request them. TurningArt will also sell you a framed print that you especially like (for $100), or let you apply your monthly subscription fees toward the purchase of an original work.

The new funding, according to founder Jason Gracilieri, "will allow us to expand the team, the collection [of artwork], and the delivery options. We want to have the definitive catalogue of independent artwork, and help facilitate the in-home discovery and buying experience for art." The company has six employees, and is growing, Gracilieri says.

"We've now served thousands of customers, and we can say we have customers in all 48 continental U.S. states," he says. With the new funding round, Fouad ElNaggar, a senior vice president at CBS Interactive and ex-VC, will join TurningArt's board. TurningArt raised a seed round of $750,000 in March 2011.

Back in February, I wrote about my experience as a TurningArt customer. And last December, I mentioned the company in a Globe column about art-related startups in Boston.

The MMMMaven Project aspires to be the Harvard of house — or the Dartmouth of dubstep — for DJs and producers

Posted by Scott Kirsner May 18, 2012 01:52 PM

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The team that organizes the annual Together electronic music festival in Boston is in the process of raising money and scouting locations for a new school that would offer courses in DJing and producing dance music. It'll be called The MMMMaven Project, and founders David Day and Alex Maniatis hope to have a location nailed down next month, and begin teaching some pilot courses in July. (Day is on the left in the picture, Maniatis on the right.)

Electronic dance music, or EDM, "has just blown up," says Day. "Kids today aren't picking up guitars — they're picking up laptops. We wanted to start an educational institution for aspiring fans of EDM," an umbrella term that encompasses genres like dubstep, trance, house, and hardstep. It's music made primarily to get people out on the dance floor.

The school will teach students how to use music-making software from companies like iZotope (based in Cambridge) and Ableton (based in Germany), but Maniatis adds, "We'll also teach methodology and history, not just the software. Everyone will have their own turntable and workstation with a mixer — you won't have to bring your own laptop to school." Among the instructors at the MMMMaven Project will be DJ Baltimoroder.

And for a little history lesson, Maniatis noted that Donna Summer's "I Feel Love" from 1977 is generally regarded as the song that helped spawn the genre of EDM. Day explained that EDM has been gaining in popularity during the recent recession: "It's kind of like jazz was during the Great Depression — a way for people to escape the headlines of the day. And now, like jazz, it's finding mainstream acceptance."

There's no web site yet for The MMMMaven Project, but they do have a profile on AngelList and a Twitter feed.

(Photo above courtesy Mick Murray.)

RunKeeper founder Jason Jacobs to entrepreneurs: My biggest regret was not having the confidence to get going earlier [Audio]

Posted by Scott Kirsner May 15, 2012 08:34 AM

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Last Saturday was the second annual edition of RamenCamp, a conference that focuses on boot-strapping techniques, mainly for software, mobile, and Internet businesses. One of the best sessions that I caught — and I was only there for a few hours — was a fireside chat featuring RunKeeper founder Jason Jacobs. (He was interviewed by Jeff Seibert, another entrepreneur. Jeff is on the left in the photo, Jacobs on the right.)

A snippet of audio is below. Among the things Jacobs discusses:

- Starting a company as an MBA who doesn't write code.

- Hiring people at different stages in a startup's evolution.

- Some of the biggest lessons he has learned in starting his first company.

- Building a nimble culture where employees can make fast decisions, even without having perfect information.

- Scaling at the right pace after you've raised funding.

- His biggest regret: "Not having the confidence to get going earlier. I was 30 or 31 when I started my first company."

- Jacobs: "Figure out what are you really passionate about. If you could solve any problem, what would it be? Once you find it, don't wait."

- Is location important? (IE, doing a startup in Boston vs. Silicon Valley)

The audio runs for about 12 minutes. Hit play below, or the "mp3" link to download it for later listening.

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Angels in Boston: Globe column, responses, and bonus material

Posted by Scott Kirsner May 14, 2012 09:56 AM
Sunday's Globe column focused on whether we're seeing enough new angel investors come out of recent IPOs and acquisitions.

From the piece:

This month’s initial public offering of Facebook will mint a lot of new multimillionaires. No doubt they will spend some of their wealth on fast cars, private jets, jumbo-size boats, and stunning vacation spreads in Hawaii.

But as is the Silicon Valley tradition, they’ll also put some of it into a new generation of start-ups. Hundreds of Facebook employees will have enough money to become “accredited investors’’ in private companies - aka angels. The Valley already has so-called mafias of rich alumni from companies like Google and PayPal supporting new ventures. (The very first investors in Facebook, in fact, were members of the PayPal mafia.) And the money invested by Facebook employees and veterans over the coming years will be another energizing espresso drip into the Valley’s economy.

So where does that leave Boston? ...I wanted to understand whether our region is keeping pace, since it often seems to me that the bulk of Boston’s angels made their money in the 1980s and 1990s, at companies like Lotus Development Corp. and Avid Technology.

Here are some responses to the column, and bonus material:

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New Hampshire company building a ball that needs your smartphone to play

Posted by Scott Kirsner May 11, 2012 10:32 AM

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If you have kids, you've probably gotten used to handing them your phone so they can play games or watch videos.

So what about handing them your phone so they can insert it into a Nerf-like ball and toss it around?

That's the idea behind a new product from Physical Apps in Hollis, New Hampshire. The TheO Ball is a foam sphere with a pocket in its center that keeps the phone safe while allowing players to see its screen. Some of the initial games will be bowling, hot potato, and a question-and-answer game called Interrogo, but the company also plans a software development kit that will enable others to create games for TheO. The ball will sell for $24.95, and include several free apps. Additional apps will be sold through the Android and iTunes online marketplaces.

Popular Science dubbed TheO the best toy at this year's Toy Fair trade show in New York, and Physical Apps chairman Bob Houvener tells me the TheO will start shipping this summer. It'll be available through the company's web site and Amazon store, as well as a number of independent toy retailers.

Houvener writes via e-mail, "We see a very significant opportunity to get folks up and moving, while leveraging their smart devices with our innovative and proprietary physical enablers such as TheO, combined with fun and enjoyable apps. This essentially lowers the price point for 'console' type game experiences by an order of magnitude, while expanding the market to an even greater degree globally."

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CoachUp readies for launch, aiming to connect aspiring athletes with private coaches

Posted by Scott Kirsner May 9, 2012 09:21 AM

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A Cambridge native who played professional hoops in Israel is getting ready to launch a new online marketplace for private coaches. CoachUp founder Jordan Fliegel took the wraps off a test version of the site recently — and among more than 100 golf, squash and baseball coaches on CoachUp, you'll also find Fliegel himself, offering his advice on "attacking the rim with limited dribbles" for $69 an hour.

Fliegel grew up in Cambridge, and played varsity basketball at Bowdoin College before spending two years on the rosters of pro teams in Israel and Europe. A broken foot led to the end of his playing career, but while based in Israel, he also started taking business school courses at Tel Aviv University. (He finished his MBA locally, at Brandeis.)

As Fliegel worked in business development for Waltham-based Zintro, he also did some private coaching in town, and the idea for CoachUp started to take shape. The site targets middle- to upper-income parents who have kids in middle school or high school playing a sport competitively, and who naturally want to see their kids improve.

Coaches who offer their services through the site name an hourly price, and CoachUp adds a small mark-up. "We're never going to take a penny from a coach," Fliegel says. The site will encourage users to purchase five or ten coaching sessions at once, with discounted pricing on those packages. Fliegel says that CoachUp will interview coaches before allowing them to list on the site, and will check references. "We'll also be collecting data on how many clients come back to purchase more lessons, and getting community feedback," Fliegel says. "Over time, the best coaches will rise to the top, and the worst will sink to the bottom."

Fliegel says he's trying to wrap up a $100,000 fund-raising round before the site's official launch; angels already involved include Mike Dornbrook, formerly chief operating officer at Harmonix Music Systems, and Scott Heller of CoFlow Investing. Fliegel says that Sheila Marcelo, CEO of the personal services marketplace Care.com, has been an advisor.

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The Innovation Economy Awards, TechStars edition

Posted by Scott Kirsner May 3, 2012 05:59 PM
My comprehensive report on this spring's TechStars demo day is here... but as is my habit, I also wanted to single out a few individuals and teams for Innovation Economy awards. They receive no monetary prize, crystal paperweight, or certificate suitable for framing — just the warm glow of being mentioned on this blog.

Boston's Most Impressive New CEO
Yifan Zhang of Pact, which has developed a mobile app that uses behavioral economics to motivate people to go to the gym. Not just for a masterful presentation today, but Zhang has built strong momentum for the company leading up to today.

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The French fellows building Psykosoft want to make it easier for anyone to create digital artwork, animation, and music. In today's presentation, they playfully tweaked tech giant Adobe for offering pricey software (like Photoshop) that's hard to learn; their mission is to make it enjoyable and fast for anyone to start creating cool stuff online. The team has a great attitude and a fun marketing message: "We believe everybody is a bit crazy, but not everyone accepts it." (That's the Psykosoft team hard at work in the photo at right.)

The Making Cities More Liveable award
Zagster, a company founded in Philadelphia that relocated to Cambridge earlier this year. The startup wants to make it easy for colleges, hotels, and corporate campuses to offer fleets of bikes for hourly or daily use. And more bike riders is an excellent thing for any city.

Most Compelling Presentation
Chris Howard of Libboo, who's out to reinvent the publishing business for the digital age. He talked about his company's mission of finding more readers for e-books by poets like Marshall "Soulful" Jones... and had Jones recite one of his electrifying poems to begin the presentation.

The Gotta Download It Now award
UberSense chief executive Krishna Ramchandran made me want to buy one of the company's mobile apps on the spot. They allow you to shoot video of your golf, tennis, or baseball swing, for instance, and then pay $10 to have a coach analyze what you could improve. You can also watch your video side-by-side with that of a pro to observe the differences.

The Biggest Surprise award
Laveem, which started out the TechStars program focusing on building an online community to help teachers share lesson plans and classroom resources. Now, they're working on the Food Genome Project, a vast database of nutritional information that could help site builders and mobile app developers create useful new tools for cooks and diners. Great concept.

TechStars Boston: A scorecard for the 13 startups presenting at the accelerator program's spring demo day

Posted by Scott Kirsner May 2, 2012 02:28 PM

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Thursday was the spring "demo day" presentation for this year's crop of startups participating in the TechStars Boston accelerator program. Thirteen fledgling companies presented in front of an audience of investors, press, and tech community members at the Wilbur Theater.

According to my math, this year's crop of startups announced today that they've already raised more than $5.5 million in aggregate. That's significantly more than was announced last year, when the companies had commitments of about $4 million by demo day.

Here's my scorecard of the companies, what they do, who's involved, and how much money they've raised or are seeking.

I've listed the companies in order of who had the most buzz heading into the event, according to the mentors and investors with whom I've spoken over the past few weeks (as well as media coverage.)

Psykosoft (team pictured above, in TechStars' Kendall Square HQ)

"You are an amazing artist! You just never had the right tools to express yourself yet." An easy way for the non-artistic to turn photos into paintings, or create and share animated GIFs. Company's mission is to make it easy to be creative, and its next project is a web-based music composition app called PsykoDio.

"Adobe PhotoShop is amazing: it only costs $522," Gosselin said during his demo. "Then you can buy a book like 'Photoshop Made Easy.' And the interface hasn't changed in twenty years. Photoshop is vintage, it's a lot of fun to learn, and it only costs you a kidney. What happens if you're lazy and you want to have fun in your life?" Psykosoft lets you instantly paint like Monet or Van Gogh or "Picasso 2.0," he said. The free site is already getting 60,000 visits per day.

- Participated in the European Seedcamp accelerator program in 2011.
- French team led by CEO Matthieu Gosselin
- Mentors: Former Harmonix COO and angel investor Mike Dornbrook, Fred Destin of Atlas Venture, Dave Balter of BzzAgent/Intelligent.ly.
- Raising $500,000, with Destin already committed to invest.

Murfie

Imagine if all your music — CDs or digital downloads — could live in one place. Murfie says it's building a "bank for your music," with the ability to legally buy, sell, and trade the tunes you own. One service the company offers is the ability to send in your CD collection, have it digitized, and stream it to mobile devices, computers, and Sonos music systems. (We'll see what the record labels think about your ability to sell a digital track that you may have already ripped to your hard drive from the CD.) CEO Matt Yunkle notes that even in the age of iTunes, the number of Americans buying CDs actually grew last year. He says current Murfie subscribers are already spending $200 on the site.

- The Madison, Wisconsin startup came into TechStars with $1.4 million in funding. It sounds like they eventually plan to raise more — but not imminently.
- They've been having partnership discussions with major record labels, but haven't announced any deals yet.
- Mentors: Rudina Seseri of Fairhaven Capital Partners, Shawn Broderick of Oomba/Play140, Eric Paley of Founder Collective.

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Betaspring Launch Day 2012: The Innovation Economy awards

Posted by Scott Kirsner April 26, 2012 06:20 PM
I zipped down to Providence this afternoon to watch sixteen entrepreneurs present brief demos of what they've been developing as part of the spring 2012 Betaspring startup accelerator program.

All of the teams had impressive pitches, and several had already raised $100,000 or more from investors before their official "coming out" presos today. Here are my very subjective, somewhat tongue-in-cheek Innovation Economy awards for Betaspring's latest crop...

incantor.jpgRooting for Them to Take Over the World award

Next time you're in the hospital, you'll probably wish the doctors, nurses, and lab techs were using CareThread. It's a mobile app that lets a doctor going home for the night update the next doctor coming on duty about your status. That next doctor can also get an instant alert once your latest lab tests come in. The founders of CareThread say that patient hand-offs — typically done with a quick hallway conversation or some scribbled notes today — are responsible for 80 percent of all medical errors.

Seems Like the Next 'Guitar Hero' award

Betaspring clearly saved Movable Code for the last slot of the day for a reason: the startup had a wacky, fun demo of a new game, Incantor, that combines a mobile phone strapped to your arm with a magic wand. (See the pic at right.) You can cast spells and do battle alone or with other players — and the company will of course sell you special spells after you've gotten hooked. Now if they can only get 10 percent of all Harry Potter fans to buy one...

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Audio: PR and media relations advice for entrepreneurs, from Kel Kelly and Scott Kirsner

Posted by Scott Kirsner April 26, 2012 08:18 AM
On Tuesday, I was in Kendall Square with a group of about 35 entrepreneurs at an event organized by Matrix Partners. The focus of the free event was on how entrepreneurs can work effectively with bloggers and traditional media to generate coverage of their companies. Joining me was Kel Kelly, who runs the Boston PR and social media firm Kel & Partners. Her firm has worked with clients like Zappos, Staples, Rue La La, and Reebok. Audio from the session is below.

Among the things we discussed:

- Why companies get left out of big "round up" or trend stories that include five or six different companies.

- Trade-offs between handling PR yourself, and hiring an agency

- Coming up with a comprehensible "cocktail party" explanation of what your company does, and the problem you're trying to solve

- Being helpful to journalists even when you're not pitching a story on your company

- How and whether to offer an exclusive

- Getting covered by influential bloggers and Tweeters

- PR Newswire, Business Wire, and social media releases

The audio runs for just over an hour. Click "mp3" to download it for later listening.

I'll be doing a similar discussion at Ramen Camp on May 12th, during lunch. Admission to that day-long event is, unfortunately, not free. It costs $15, but it includes lunch, a t-shirt, and the first beer free at the after-party.

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Audio: Panel on using Kickstarter to raise money for startups and creative projects

Posted by Scott Kirsner April 22, 2012 11:01 AM

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I moderated a panel last Thursday at the Cambridge Innovation Center featuring four Kickstarter case studies: musicians, filmmakers, artists, and entrepreneurs who'd used the crowd-funding site to raise substantial sums of money. ($114,000, in Bill Lichtenstein's case, for a documentary about the glory days of the Boston radio station WBCN.)

Here's who participated (along with links to their Kickstarter pages)

- Cambridge singer-songwriter Ariel Rubin, who funded her EP "Big Spoon" on Kickstarter

- Journalist Bill Lichtenstein, making a documentary film called "The American Revolution"

- Brad Geswein (pictured at right holding a prototype) and Slava Menn of Gotham Bicycle Defense Industries

- Coulter Lewis of Quinn Popcorn

We talked about some of the factors that get people you don't know contributing to your campaign; the right length for Kickstarter campaigns, and the right target amount; how you can get blogs and other media to help promote your campaign; and some of the headaches that can arise when you're dealing with hundreds or thousands of donors. And Rubin started things off by singing a great song.

The audio is below. You can stream it here, or click "mp3" to download it for later listening. (Related content: "How Supermechanical raised $550,000 for a new wireless device — without VCs or angel investors.")

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Above, from left: Scott Kirsner, musician Ariel Rubin, Brad Geswein and Slava Menn of Gotham Bicycle Defense, filmmaker Bill Lichtenstein, and Coulter Lewis of Quinn Popcorn. (Photo above courtesy of Keith Spiro Photography.)

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TechStars Boston doubles down on startups; will run two annual programs

Posted by Scott Kirsner April 16, 2012 01:10 PM

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The TechStars Boston accelerator program for startups will now take place twice a year, managing director Katie Rae tells me. That will double the number of new ventures that can participate in the program, to about 24 annually.

And Rae and Reed Sturtevant, who helps run the Boston program, say they are hoping to expand its focus, explicitly inviting robotics, bio informatics, health IT, digital manufacturing and edutech companies to apply. The fall program will begin in September.

"The main driver for increasing the frequency of the program is the high quality of companies applying," Rae says. "We also have an incredible mentor network that grows every year, and I think we're personally getting better at running the program. Doing it twice a year lets us have a continuous staff." The spring TechStars Boston program, taking place now, has been held for four years now.

I asked why they wouldn't just expand the size of the spring session, from a dozen to 20 or 25 companies. "We think that core to our model is working with a small group of companies, and enabling them to have lots of one-on-one sessions," Rae said.

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Pop-up shop on Newbury Street will showcase products from startups

Posted by Scott Kirsner April 11, 2012 10:04 AM
You don't often find Harvard Business School students toiling at retail jobs on Newbury Street, but that'll change — for a weekend, at least — later in April, with the launch of a temporary "pop-up shop" called POPstart.

popstart-small.gifThe store will feature a selection of products from local startups and student-run businesses, and the goal of the POPstart concept is to help those kinds of companies reach consumers and test out new concepts without the expense of setting up their own retail presence. "While a start-up would normally not have the resources to maintain a permanent brick and mortar presence — particularly on Newbury Street — POPstart provides that chance by aggregating the collective resources of startups," explains Josh Plavner, one of the HBS students working on the project as part of the school's FIELD initiative, which promotes entrepreneurship through the creation of "micro-businesses."

You'll be able to find POPstart at 328 Newbury Street on April 21st and 22nd. It'll be open from 11 AM to 7 PM.

Why only two days? "We wanted to test out a minimum viable product to see if this concept resonated as much with start-ups and consumers as we think it will," says Plavner, adding, "We are really trying to prove out the concept and then evaluate how to take it to the next level on a more permanent basis."

The companies whose products will be featured are:

• 9 Tailors – Bespoke suit and custom tailoring experience for men
• Breakup Box – Gift box for newly-single women
Cocomama Foods – Gluten-free breakfast cereal
• Ministry of Supply – High-tech men’s business apparel
• Plug Love – Decorative plugs for earphone jacks and smartphones
• Quiyk – Performance athletic apparel with a specialization in quidditch gear
• Survitalize – Interview “survival kit” for college and graduate students going through the job interview process
• Tav Cashmere – Socially-responsible sourcing for cashmere products
• Zeo – Bedside sleep management system

The staff at POPstart will be using mobile credit card readers from Square to take payments for products, and representatives of some of the startups will be present — for instance, 9 Tailors employees will be taking measurements for their custom shirts.

I'll definitely be stopping by to check it out...

Kickstarter surge continues in Boston; panel discussion on April 19th

Posted by Scott Kirsner April 6, 2012 09:05 AM
Hardly a day goes by that I don't hear about a new project that's trying to raise money on Kickstarter. There are Emerson College student films pulling in $1,000, camera case designers collecting $24,000, and wearable data storage startups raising $13,000.

The New York-based site lets artists, designers, and entrepreneurs set a fundraising goal and essentially run an online telethon; backers at various levels get different kinds of payouts, from a digital download of an album to a limited edition iPad case.

I'd missed the fact that last year, two Berklee College of Music students used the site to raise $7,200; the money went toward recording and making a video for "The Boston Song," a pop anthem for the city.

And just yesterday, Tufts student Brett Andler e-mailed about his Kickstarter project: trying to raise $10,000 for a game called Whozit. It's a version of the guessing game "Guess Who" that taps into your collection of Facebook friends.

I've written here about how the MIT spin-out Supermechanical used Kickstarter to raise $550,000 to design a new kind of wireless sensor, and also talked about the larger crowdfunding trend in my Boston Globe column.

And later this month, the folks at the Venture Café in Cambridge have put together an interesting panel that I'm moderating: "Killing It On Kickstarter: Running successful campaigns for new products and creative projects." It features four entrepreneurs and artists who've used the site to raise money for everything from a new brand of microwave popcorn to a documentary about the heyday of radio station WBCN ($114,000!). It's free, and it happens on April 19th from 6 to 7 PM. Hope to see you there...

HBS prof Noam Wasserman talks about his new book, Founder's Dilemmas [Audio]

Posted by Scott Kirsner March 27, 2012 08:36 AM
Harvard Business School professor Noam Wasserman is one of the writers and teachers who best captures the high stakes decisions that entrepreneurs face every day. His new book, out this month, is called "The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup." He teaches the "Founders Dilemma" course at HBS (it was so popular that it had a wait-list of 170 students last year), and maintains a blog called Founder Frustrations.

noam.jpgThe book reads like a catalog of all of the choices that can either sink a start-up, or help it build momentum — choices around how to divide ownership among the founding team, who should serve on the board, and whether to take money from "friends and family" or professional investors. Wasserman has spent hours interviewing the founders of companies like Zipcar, Proteus Biomedical, Pandora, and Twitter, and he shares their experiences in the book, without sugar-coating them.

I sat down with Wasserman last week in his office at HBS. We talked about founder's dilemmas in general (65 percent of them, he said, have to do with interpersonal issues among founders), and some of the specific companies he has studied, including Sittercity (founded by Genevieve Thiers, a Boston College grad), 38 Studios (the gaming company started by Curt Schilling), and Twitter. The audio runs about a half-hour. You can click play, or click "mp3" to download the file for later listening.

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Can a new site for car buyers, Speedbilly, make pricing more transparent?

Posted by Scott Kirsner March 5, 2012 08:20 AM

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If you're shopping for a laptop, airline ticket, or new house, the Internet will happily serve up a specific price. So why is it that buying a car still tends to involve e-mail exchanges with car salespeople, who often are reluctant to quote an exact price on an actual vehicle until you come in to the dealership?

"They feel that a high-margin sale is much more likely if they can get you there in person," says John Connors, chief executive of Boathouse Media in Waltham. "They do have a price matrix where they know what they'd like to get for each vehicle, but they just don't want to put it on the web."

A new site that Boathouse has developed, Speedbilly, wants to change that, creating a kind of Kayak for new car prices, enabling shoppers to compare the price for the same vehicle with the same options across various dealerships. "When I was buying a Honda Odyssey for my family, I had the experience of no one wanting to give me a specific price in an e-mail until I really pushed them for it," says Connors. "We felt that if we could fix the car-buying experience, that's a pretty big opportunity." (Boathouse is a 45-person marketing agency that works with clients like Merrill Lynch, Thermo Fisher, and Harvard Business School.)

The site's official launch won't happen until later in March, but a beta version is up and running. When it launches, Speedbilly will include inventory from 20 dealers in eastern Massachusetts who sell just four brands: Toyota, Honda, Nissan, and Hyundai. Many other dealers likely want to wait and see how the site performs.

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Line Genie offers club-goers a way to skip the line

Posted by Scott Kirsner March 2, 2012 08:11 AM

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If you're in the age bracket where you often find yourself standing in line outside a club or bar on Saturday night, a new start-up wants to help you get past the doorman faster. Line Genie asks you to commit to spending at least $50 at the venue — you're essentially pre-paying for a gift card through their website — and in exchange, the venue waives the cover charge and lets you bypass the line. Right now, Line Genie is in test mode at Ned Devine's and The Harp, both in downtown Boston.

Founders John Clifford and Trevor Schwartz met in a pretty unusual place: while working on the factory floor at Raytheon, building sub-assemblies for Patriot missile radar systems. Clifford went on to earn an MBA at Boston College, and Schwartz is currently pursuing a degree in MIT's Leaders for Global Operations program.

In the company's test phase, they've been limiting sales to 20 passes at each venue. At $50, a pass gets two people into the venue without paying the cover or waiting in line, and also includes $50 in food and beverage credit. Passes can be purchased online as late as 9 PM on the night when you plan to use them, or bought a few days in advance. Schwartz says that even on nights when you arrive to find that there's no line, the pass can be a good deal, since it saves you the club's cover charge.

Schwartz says that venues start off with a free trial of the service, and then at some point start cutting Line Genie in on 10 percent of the pass revenues. "This is a way for them to know that they're going to get at least a certain level of spending from people who come in the door," Schwartz says. Already, the company has sold about 700 passes — many to groups of people (think bachelor and bachelorette parties) going out together.

Schwartz says the company is in discussions with a number of additional venues.

(The Daily Free Press at Boston University profiled the company recently, and found that college students seem to like the idea.)

HomeRuns founder launching new food delivery service in Cambridge and Arlington

Posted by Scott Kirsner February 22, 2012 11:32 AM

Update: Of Course Meals discontinued its service in September 2012, and Furber is now a vice president at Care.com.

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Would you make meals at home more often if you could do it like a Food Network star, with the fish already filleted, the carrots julienned and ready, and the knowledge that every required seasoning was within arm's reach?

That's the premise of a new Cambridge start-up, Of Course Meals, which is cranking up operations this week. The company delivers a bag of prepped ingredients to your home on Sunday evening. Inside the bag are the items you need to make two, three, or four meals for a family of four. The proposition is that you spend less time grocery shopping, and less time cooking (the meals take about a half-hour to cook), but still provide healthy, home-cooked food for your family. The pricing starts at $60 a week, which covers two dinners for four people. Consumers get to choose whether the meals feature beef, chicken, seafood, or just veggies. The dishes, which include coconut curry chicken and Asian salmon, sound pretty tasty. (It's also getting close to lunchtime...)

"Our mission is that we want to make it easier for families to enjoy meals together, and remove some of the stress for working parents, who tend to start worrying about what's for dinner every weekday around 3 p.m.," says Tom Furber, chief executive of Of Course. "No one wants to come home to hungry kids and chaos."

The company is launching its delivery service in Cambridge and Arlington. (If you order by midnight tonight, you can be part of the first wave of deliveries this Sunday.) You can order week by week, or save a little money by signing up for an on-going subscription.

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Testing out TurningArt, Boston's 'Netflix for artwork'

Posted by Scott Kirsner February 21, 2012 11:55 AM

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I moved into a new place last fall with more wall space than I knew what to do with. In particular, there was a large expanse at the top of the stairs that I wanted to fill. So earlier this year, I signed up for TurningArt, a Boston-based subscription service that promotes itself as "the cure for empty walls."

I'd written about the company a couple times, so I was interested to see how it performed from the consumer's perspective.

The first thing that caught my interest with TurningArt was that at some point, I'd started receiving daily e-mails from the company showcasing the new artists in its collection. The collection is primarily paintings and photography by living artists, much of it with a contemporary, slightly edgy feel. There were a few artists whose work caught my eye. I bought one small original painting from one of the artist's Etsy storefronts for $50. The other artist I liked was selling paintings at a higher price point, and I thought that signing up for TurningArt would be a good way to "test drive" what they might look like in my home.

TurningArt offers two different pricing plans: for $10 a month, you get its standard 16-by-20 inch frame, or for $30 a month you can get a larger 24-by-30 inch frame. Both subscription plans include a free black gallery-style frame with a white mat, and the opportunity to rotate the artwork as frequently as you like. The art you receive is an unsigned, unnumbered "museum quality" print. As with Netflix, you have a queue of artwork you'd like to rent on the website, and the shipping costs are included in the subscription package. Unlike Netflix, you can request your next piece without sending back the one that's in the frame; instead, you use the cardboard box that the new print comes in to send the old one back.

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Bolt, new accelerator program for start-ups designing physical products, looking to put down roots in Boston

Posted by Scott Kirsner February 17, 2012 04:00 PM

Update: Bolt has found about 10,000 square feet of space at 110 Chauncy Street in downtown Boston (at street level and below ground). In February 2013, the program told the SEC that it has so far raised $3.5 million in launch funding. Bolt's website says that it will "accept 10 teams for the Winter 2013 class. Teams must relocate to our facility in Boston and spend a majority of their time here for the duration of the 6 month program." The word "winter" there would suggest that they may soon announce who'll be part of this first crop of startups...

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Boston has been home to two major "accelerator" program so far: TechStars Boston and Y Combinator. And both of them have focused almost exclusively on start-ups developing Web sites, mobile apps, and software-as-a-service offerings. (Y Combinator, of course, now operates exclusively in Silicon Valley.)

Ben Einstein, right, wants to change that. He's out raising money and laying the groundwork for a new accelerator program, Bolt, that would focus exclusively on entrepreneurs who want to design physical products. Einstein, previously a principal at the product design consultancy Brainstream, moved from Northampton to Boston last month to make Bolt a reality.

Einstein says that Bolt will focus on "connected devices," including consumer electronics and robotics, but avoid medical devices and other products that would require extensive, blank-sheet-of-paper engineering. "We're thinking mostly about off-the-shelf components being combined in new ways, where you might have a new device that works with a web service, or plugs into a mobile phone," he says. Bolt's offices will include useful tools that the chosen entrepreneurs will have access to, such as drill presses, band saws, 3-D printers, PCB prototyping equipment, and CNC milling machines.

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Audio: Newbury Comics founder Mike Dreese on growing a retail business online and off, at MITX's E-Commerce Summit

Posted by Scott Kirsner February 1, 2012 08:35 AM

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Sharing some audio from the MITX E-Commerce Summit last Friday, at which I had the chance to do an on-stage interview with Newbury Comics CEO and co-founder Mike Dreese. Our focus was how he'd built the company from a single comic book store on Newbury Street into a major New England retailer that sells music, movies, clothing, pop culture totems, and, of course, comic books. Online, Dreese oversees the flagship Newbury Comics web site as well as Punk.com, which focuses on edgy clothing and accessories.

As we chatted before the session, while scarfing down our box lunches, Dreese told me that he'd dropped out of MIT in 1978 to start Newbury Comics with his college roommate. They had just $2000 in start-up capital. Today, the company has about 480 employees, 30 stores, and $75 million in 2011 revenues. About $23 million of that 2011 total was generated online.

Among the topics we covered:

> How Newbury Comics got its start
> The company's late 1990s web strategy, compared to today's
> Mobile price comparison apps
> Why highly-trafficked malls are still important to the company
> The importance of sourcing unique merchandise, and selling it through multiple online channels
> Who should be allowed to speak for a company in social media channels like Facebook
> What Newbury Comics will sell when most movies and music are purchased in digital form
> The coming collapse of brick and mortar stores

Here's the audio. You can click play, or click "mp3" to download the file for later listening.

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Shoebuy.com founder teams with ex-Yankee Group chief to deliver healthier school lunches

Posted by Scott Kirsner January 26, 2012 08:29 AM

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Scott Savitz and Emily Nagle Green are out to take your child's lunch money.

Their Charlestown-based start-up, Smart Lunches, is already delivering lunches at about $4 or $5 a pop to eleven Boston-area schools and daycare centers, and Green talks about building Smart Lunches into a nationally-known brand: "There's a national market available here, and you can't think of a brand that has national awareness around providing nutritious food to kids when they're away from home." The target market, as she sees it, is about 30 million kids between the ages of two and eighteen who don't participate in school lunch programs.

Savitz left Shoebuy.com, the online footwear retailer owned by InterActive Corp., last summer. He was introduced to the two founders of Smart Lunches, Cathy Goldman and Susan Frigoletto, as a prospective advisor. (Savitz's wife had served on the board of the Charlestown Mothers Association with Frigoletto.) Though the pair had only begun delivering lunch to schools in the Boston area last September, Savitz decided to make an offer to acquire the company just before the end of 2011. He knew Green (pictured at right) from serving alongside her on the MITX board; she had vacated the CEO's office at Yankee Group, a Boston tech research firm, at the end of 2010, and was thinking about next steps. She signed on to run the business around the same time that Savitz was wrapping up the acquisition.

Green says, "I was really captivated, partly because it's so different" -- she'd earlier run Cambridge Energy Research Associates and been a top executive at Forrester Research -- "and partly because the mission is so compelling. The company is doing something worthwhile, and there is a huge scale opportunity."

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Sampling the new AeroShot inhalable energy shot

Posted by Scott Kirsner January 3, 2012 01:27 PM
Last month, I wrote about AeroShot, a powdered caffeine formulation delivered in a lipstick-sized inhaler. It's being marketed by Breathable Foods, a Cambridge company. Right now, it's only available through the company's Web site, at $2.99 per inhaler, but the product is supposed to appear in Boston and New York retail outlets this month, perhaps right next to the bottles of 5-Hour Energy Drink.

Already, U.S. Senator Charles Schumer of New York has begun calling the product dangerous to teens; Schumer wrote a letter to the Food & Drug Administration in December suggesting that the product would encourage excessive caffeine intake, and could be used in combination with alcohol to fuel binge drinking.

We got some early AeroShot samples, started the video cameras, and huffed away. Each inhaler is supposed to deliver about 100 milligrams of caffeine — equivalent to a cup of coffee — along with B vitamins and Niacin. There was a noticeable buzz after a few puffs, but the powder's limey flavor was overpowered by an aggressive bitterness from the caffeine. The flavor lingers in your mouth for longer than you'd like, and it resembles lime Fun Dip blended with crushed aspirin. The overall effect is much more medicinal than enjoyable.

Here's the taste test I conducted recently with Boston.com senior business producer Joe Allen-Black.

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New book on using LinkedIn, 'The Power in a Link,' also tells you how to stalk journalists like me

Posted by Scott Kirsner December 23, 2011 11:44 AM

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I'm not sure if I should post about the new book from Cambridge entrepreneur Dave Gowel, a former Army Ranger who now runs the software start-up RockTech.

Just out from John Wiley & Sons, "The Power in a Link" is a 159-page guide to "changing the way you do business using LinkedIn." It covers topics like how to set up a profile that represents you well; the best way to collect recommendations from people with whom you've worked; how to conduct advanced searches if you're hunting for new employees or key business development contacts; and how to think about your status updates on the widely-used social network.

But it also offers three-and-a-half pages on how Gowel stalked me — albeit politely — to tell me about the LinkedIn training services he was offering in 2009, and get me to write a column that featured him. After Gowel started following me on Twitter, reading my blog, and scoping out our mutual LinkedIn contacts, he went to a breakfast panel I'd helped to organize. He writes:

...I arrived at the event early, thinking that if Scott was hosting, he'd be there early as well, and he was. I struck up a conversation in the least harassing way possible by talking about things he'd written, making sure to insert our mutual connections into the brief conversation: "I noticed via LinkedIn that you know Tim Rowe and Jeff Bussgang; how do you know them?"

Truthfully, it's not bad advice for connecting with any journalist: we remember face-to-face meetings much better than e-mails or phone calls, and it sure doesn't hurt to have read some of our recent writing so you know what we cover. (As opposed to asking, "What kind of stories do you write?")

Here's a 2009 column I wrote after meeting Gowel, "Make better introductions." It offers ten pieces of advice for using LinkedIn effectively.

As MassChallenge considers expansion, could New York be next?

Posted by Scott Kirsner December 6, 2011 11:54 AM
The founders of the MassChallenge start-up competition, which offers $1 million in prize money to promising companies, have spent the summer and fall engaging in conversations about expansion. While bringing the competition to a second city will require funding commitments from philanthropists and corporate sponsors — which haven't yet been nailed down — it sounds like New York tops the list, followed by London. Cities in Brazil and the Middle East are less likely candidates. And as the Boston-based program enters its third year in 2012, founder John Harthorne tells me that a second city wouldn't launch before late next year or 2013.

On New York, Harthorne says, "There's a lot of money, and a big media presence. We've been talking to billionaire types and major corporate entities." While there's no anchor funder yet for a Manhattan-based MassChallenge, Harthorne says there are several interested parties. (Among the benefactors who have supported MassChallenge in Boston are Sycamore Networks founder Desh Deshpande and Vertex Pharmaceuticals founder Josh Boger.)

Co-founder Akhil Nigam traveled to London in November to discuss the potential of a second MassChallenge program operating there. And when I caught up with Harthorne by phone yesterday, he was at Logan Airport on his way to Brazil, where he was participating in the state's "Innovation Economy Mission." "Brazil would be an interesting place for us," he said.

Though the Boston program received applications from 733 start-up teams this year (up from 446 in its inaugural year), there is the question of whether a second site for MassChallenge would dilute the quality of entrants. And also whether state agencies that have offered financial support to MassChallenge here would continue to feel that MassChallenge was doing enough to boost economic development in Massachusetts if it was simultaneously doing the same thing in New York. Harthorne acknowledges the political sensitivities, and says he has talked with city and state officials already. He believes that a New York program "could be complementary to both locations. Boston and New York both have a common enemy, which is California, and all of the hype that surrounds Silicon Valley."

Three things make the MassChallenge different from collegiate business plan competitions, or accelerator programs like Y Combinator and TechStars. First, MassChallenge is open to all sorts of start-ups, whether they're developing biotech drugs or shoes or gluten-free cereal. Second is size: they offer free office space and mentorship to more than 100 companies each year. And third, the prize pool of $1 million, doled out in $50,000 and $100,000 chunks to a chosen few companies, comes with no strings attached; MassChallenge doesn't take equity in the companies that win.

The program's 2011 winners are listed here.

On the radar: 10 start-ups worth watching

Posted by Scott Kirsner November 28, 2011 11:10 AM
One of the perks of my job is getting a chance to talk to entrepreneurs who are just getting companies off the ground. They tend to brim with enthusiasm about tackling opportunities that others can't see. (And if they don't, well, usually their start-ups don't make it.)

Here are ten I've encountered this month, in no particular order:

- Campus Libre founder Pat de Santis graduated from WPI earlier this year, and he's trying to solve a problem every college student has encountered: the high price of textbooks. Campus Libre offers students a way to buy and sell used textbooks from other students at their school; the company hopes to generate revenues from referral fees, when students can't find a suitable used text and decide to buy a new one online.

- Brendan Smith launched Bizulu, a new twist on online auctions, last month. "eBay was built in 1995, when Al Gore had just invented the Internet," Smith jokes. "We built Bizulu for generation instant gratification. They want to get in and get out." Auctions on Bizulu last exactly ten minutes, and there are interesting competitive ways to "blitz" other bidders, reducing the amount of their bid, over several rounds of bidding.

- Ever been to an event — maybe a wedding or graduation party — where everyone seemed to be snapping pictures, but only a few surfaced afterward on Facebook or Flickr? Junctions, from John Hoopes and James Rogers, wants to solve that problem with a new iPhone app that lets you produce, organize, and share group photo albums.

- Mads Srinivasan, a recent graduate of MIT's Sloan School of Management, is working on Neemware, a tool to gather user feedback and market research information within mobile apps. Srinivasan says he's talking to a number of app developers now (Neemware is rolling out first for iPhones), and adds that he may try to raise money for the start-up soon.

- Dave McLaughlin's start-up, Vsnap, was part of this year's crop of MassChallenge companies. Vsnap is geared to sending short, person-to-person video messages via e-mail — 60 seconds max — using the Webcam on your computer, and including related documents like a product info sheet or photo.

- CoPatient, from Rebecca Palm and Katie Vahle, offers to help analyze your medical bills, spot mistakes, and negotiate for fairer rates if you're being billed more for a service than is typical. They either work on contingency — taking 30 percent of the amount they save you — or you can buy a $50 monthly subscription. (Both Vahle and Palm are employees of athenahealth, a Watertown company that helps doctors wring money from insurance companies.)

- Groupize helps small groups find hotel rooms, book buses, and make restaurant reservations. Founder Charles de Gaspeau Beaubien has worked in tourism for his entire career.

- Fivi is a "personal wellness community" that encourages you to set and manage your fitness goals. There are also videos on topics like preventing injuries and controlling your sodium intake. Nabil Aidoud, a former consultant at IBM Global Services, is the founder.

- With CollegeGolfPass, Kris Hart is trying to make the links, lessons, and driving ranges more accessible to college students.

- Lindsey Witmer describes MyOmBody as "a holistic health coach in the palm of your hand." Does eating slowly with others improve your mood? How much exercise does it take to reduce your stress level? The start-up's mobile app, now in a testing phase with iPhone users, will help track those dynamics.

Need a whiff of energy? Cambridge-based Breathable Foods is getting ready to launch inhalable caffeine shots

Posted by Scott Kirsner November 16, 2011 04:00 PM

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Two Boston-area venture capital firms are getting behind a Wonka-esque concept: that instead of sipping coffee or nibbling on a chocolate bar, consumers might prefer to take a hearty huff. Breathable Foods, based in Cambridge, recently raised $8.5 million from Flagship Ventures and Polaris Venture Partners, and it is planning to launch its first product, AeroShot Pure Energy, in the U.S. early next year.

The company was founded by David Edwards, a professor of biomedical engineering at Harvard who earlier in his career was involved with Advanced Inhalation Research, a start-up that worked on turning drugs like human growth hormone into powders that could be inhaled, rather than injected. (That business is now known as Civitas.) Another Edwards company, Pulmatrix, is developing inhalable drugs to fight respiratory infections.

AeroShots will cost $2.99, and they contain a blend of caffeine, Vitamin B, natural sweeteners like Stevia, and natural lime flavor, all distilled into tiny particles that are about 10 microns in size. (At that size, they dissolve in your mouth and are swallowed, rather than entering your lungs, the company says.) Each lipstick tube-sized inhaler contains between 4 and 6 puffs. You can use it a puff at a time, or all at once if you're feeling especially dilapidated. One AeroShot contains about 100 milligrams of caffeine — roughly the same as an average cup of coffee.

Breathable Foods will also market another product Edwards developed and launched in 2009: Le Whif, a calorie-free chocolate inhaler. Edwards tells me that without much marketing, 400,000 Le Whifs were sold in 2010, mainly to women. Another product in development is Le Whaf. "It's a carafe that you can pour a liquid like orange juice or a martini into, and it forms a cloud of flavor that you can put into a glass, and sip out with a straw," Edwards explains. "When you use it with something like whiskey, it gives you the essence of the experience, while the alcohol content is small."

Edwards says the company will be developing other products that can deliver flavor without calories, or nutritional supplements without having to pop a pill. Edwards says that Breathable Foods' products are intended to appeal to people "interested in the new."

Noubar Afeyan, managing director at Flagship Ventures in Cambridge, says that his firm invested in Breathable Foods because "we think that the platform could be used to deliver nutrients and health-related products" in a convenient way — and in a product that isn't stringently regulated by the FDA, as are many of the biotech and pharma companies Flagship usually backs. (The FDA considers Breathable Foods' products to be GRAS substances, or things "generally regarded as safe.")

Terry McGuire of Polaris calls Breathable Foods "a novel approach to an enormous industry... Proof that we as venture capitalists should always be on the frontier of where science meets life." His firm is also invested in Living Proof, perhaps the only MIT spin-out company, ever, to make hair care products.

I just got a few AeroShot samples delivered to my office; I'm planning to try one tomorrow morning instead of my morning cup of coffee. I'll let you know how it goes...

Test-riding Uber, the populist car service you summon with a mobile app

Posted by Scott Kirsner October 18, 2011 04:07 PM
San Francisco-based Uber is planning to launch its transportation service in Boston this Thursday. They already operate in New York, San Francisco, Seattle and Chicago, and they've been pilot-testing it here over the past few weeks. I used the app this afternoon to travel from Kendall Square to Brookline in a semi-swanky black Mercury Grand Marquis.

Uber is a way to summon a town car using an app on your mobile phone. For livery drivers, it's a way to fill in extra work at times when they might otherwise be sitting around. And for consumers, it's a way to get a ride in a car that's more spacious and better-maintained than your typical cab. And the Uber app also provides better information about when exactly you'll be picked up.

Here's how it worked for me...

As my 1:30 PM coffee meeting in Kendall Square was wrapping up, I opened the Uber app on my iPhone. I'd already set up an account, giving Uber my credit card information. The iPhone's built-in GPS knew just about where I was, but Uber's app gave me the opportunity to adjust my location to the exact spot on the map where I was sitting. (Voltage Cafe, at 303 Third Street.) It told me that a driver named Hassan would arrive in about ten minutes, and that Hassan had received a 4.9 star rating from other passengers.screenshot1.png

I left the app open on my phone, and could watch on the map as Hassan's vehicle made its way from Boston across the river.

You don't tell Uber where you're going — the company doesn't want its drivers to accept or reject passengers based on their destination — and so one drawback is that the app doesn't really give you a sense in advance for how much the ride will cost. (Uber tries to position its service as slightly more expensive than a cab, but far less expensive than a traditional car service.)

Exactly ten minutes later, I saw Hassan's car pull up outside. I told him where I was going, and we set off down Memorial Drive toward Brookline. Suction-cupped to his car's windshield was an iPhone supplied by Uber, which relayed rider requests to him, and allowed him to accept or reject them based on whether he was available. The car was spotless, and Hassan was attired in a blue suit and natty striped tie.

uberdriver.jpgThere's a $7 base charge as soon as you get into an Uber car, plus time and distance charges. (Uber charges a distance fee when the car is traveling faster than 11 miles per hour, and a time fee below that speed.) The final fee includes any tolls as well as a tip, and is automatically billed to your credit card.

When I arrived at my destination, the total — $23 — showed up on my phone, and shortly after on Hassan's. We both had the opportunity to rate one another on a scale of one to five stars. (I gave Hassan five stars.) By the time I opened my laptop at my home office, Uber had e-mailed me a receipt: $7 base fare, $14.56 distance, and $2.21 time, for a total of $23. (They round down to the nearest dollar.) Uber takes 20 percent off the top, with the driver receiving the rest.

The cost of my Uber ride was comparable to what it would've cost to hail a Cambridge cab. That would've run me about $18.40 without a tip. When I tried to get an estimate for how much it would cost to arrange for a Boston Coach sedan to do the trip, the company's Web site told me that arranging for a car in 15 minutes would be impossible. But with an hour's notice, the Cambridge-to-Brookline trip would've cost $111, including tip.

I mainly try to travel around Boston using public transportation, my bike, and occasionally, my own car or a Zipcar. I rarely use taxis or town cars. I can definitely envision myself summoning an Uber car when I'm pressed for time, or traveling a route that requires multiple T transfers. Also, for airport or train station trips when I'm schlepping lots of luggage.

Based on this first experience, I liked getting a more spacious and spiffier car than the typical Boston or Cambridge cab, and knowing exactly when it would arrive. And the price felt like a good value — a town car experience at a yellow cab price point. All that was missing was the Wall Street Journal waiting for me on the seat...

Uber feels like a car service designed for the 99 percent.

Checking in with Dogpatch Labs Cambridge, two years in

Posted by Scott Kirsner October 18, 2011 09:47 AM
I'll admit I was wondering recently about the future of Dogpatch Labs in Cambridge, the free office space for start-ups in Kendall Square that Polaris Venture Partners set up in 2009, and expanded last year.

The winds shifted a bit in 2011, with Polaris announcing that it had raised a new $375 million investment fund — much smaller than the $1 billion it had collected in 2006. (The firm had initially hoped to raise a tidy half-billion, but the market didn't cooperate.) Shortly after that, partners began to splinter off from the firm, including Mike Hirshland, the guy who'd developed the Dogpatch Labs concept in the first place.

Also, over the last two years, while about 150 75 companies have circulated through the Dogpatch Cambridge space, Polaris has found just one company in which to invest: Biff Labs, a stealthy search-and-social media related start-up that recently graduated out of Dogpatch and into its own Central Square office space. (Biff's founders had previously worked together at Microsoft's New England R&D outpost, on social media oriented projects like Bing.com's Twitter search.) For context, Polaris has put money into nine start-ups that gestated in the Dogpatch Labs offices in California and New York. [Update: Dogpatch has 40 alumni companies and 35 currently in the facility. The original 150 number earlier in this paragraph was my mistake.]

Dogpatch Cambridge is great for the local innovation scene, but is it meeting Polaris' expectations — and more importantly, those "limited partners" who give Polaris money to invest?

To see where things stand, I got in touch with David Barrett, the Polaris partner who oversees the Cambridge location. He served up some stats from the first two years, and underscored Polaris' commitment to keep supporting the space.

- While Polaris has made just one bet at Dogpatch Cambridge, 22 companies that have shacked up there have received seed funding so far, and 11 have raised bigger "Series A" rounds.

- Dogpatch Cambridge is currently home to 110 people working on 35 different companies. There are about 100 companies on the waiting list to get in.

- The typical length of stay is between six and nine months. Of the 40 companies that have moved out of Dogpatch Cambridge, Barrett says roughly 90 percent are still alive and kicking.

- The typical seed round for a company at Dogpatch Cambridge has been $500,000 to $750,000. Series A fundings for Cambridge companies have ranged from $1.5 million to $8.5 million.

- There are over 30 open jobs with companies at Dogpatch Labs Cambridge.

- Over $140 million has been invested in companies across all four of the Dogpatch Labs locations.

- While Polaris has only made one investment in a Dogpatch Cambridge denizen, other firms have rushed into the void, including Venrock, Spark Capital, Shasta Ventures, CommonAngels, and NextView Ventures. So the early worries about "signaling risk" — what will other investors think if I move into Dogpatch but Polaris chooses not to invest in my start-up — seem to have dissipated.

Earlier this month, Gus Weber, an entrepreneur-in-residence who helps Barrett run Dogpatch Cambridge, posted this status update, which reports on some recent fundings and new residents.

I asked Barrett how Polaris evaluates the success of the various Dogpatch locations (Cambridge, New York, Palo Alto, and Dublin). His reply:

We measure success by asking several questions:
  • Is our DPL location a strong community, with residents and mentors supporting each other?
  • What is the quality of ideas we are seeing?
  • Have we created a magnet for other investors and repeat entrepreneurs?
  • Are we contributing to a richer, deeper ecosystem in each community in which we operate?
  • Are we seeing a good ratio of financings and acquisitions?
  • Are we building deeper relationships over a “rationalized” period of time with entrepreneurs we find to be compelling?
We think the track record across each of these measures is strong.

...Dogpatch is attracting very high quality, repeat entrepreneurs that have typically shied away from traditional incubator/co-working type spaces.

For us, Dogpatch has proven to us that it's a great vehicle for meeting, building relationships with, and working closely with next-gen entrepreneurs. For potential investment now as well as down the road as they continue to progress.

For entrepreneurs, our “open source” construct has proven very attractive as it enables relationships to be built with a cross-section of investors, advisors and mentors.

...The feedback we’ve received is that all of our DPL communities are contributing to a richer ecosystem in each operating area. We believe you'd hear from folks in Cambridge that we've been active participants in the area’s ecosystem — and active partners in helping all DPL companies succeed (regardless of [Polaris] investment).

Lastly, as we look at potential DPL investments, it goes without saying that it’s about quality of fit — not quantity...

Dogpatch gives Polaris a view into the where/what/how compelling innovation is happening. It gives us a great opportunity to share networks, learnings and experiences with entrepreneurs. And to help catalyze them to do so with each other.

Bottom-line, we’re early stage investors with a long-term view. Building these relationships helps us to not only help support the community at-large — but also helps to make us better investors for Seed, Series A & Series B opportunities today and down the road.

I asked Barrett whether his firm is committed to keeping the Cambridge location going indefinitely. (Here I should note that Microsoft, as a sponsor of Dogpatch Cambridge, underwrites the cost of rent, with Polaris paying utilities and other operating costs... so the space isn't a huge commitment for the VC firm.) "We're 'all in' with Dogpatch Labs in Cambridge and the other Dogpatch Labs communities," he said.

Is Boston spawning too many start-ups, and starving growth companies for talent?

Posted by Scott Kirsner October 17, 2011 10:02 AM
Sunday's Globe column asked the question, "Is Boston spawning too many start-ups?"
That’s the question I’ve been wondering about lately, as I see so many people toiling at two-person companies. Maybe they’re relying on their own savings, or maybe they’ve raised a few hundred thousand dollars from angel investors. Some of them win admittance to programs that try to help young companies gain momentum, like TechStars Boston or MassChallenge.

But a lot of them were two-person companies last year too, and the year before that. At the same time, many of Boston’s most promising companies with 100 or more employees have a tough time hiring. Could too much of Boston’s talent be stuck in start-ups that are going nowhere?

“The inability to recruit enough bright software developers is definitely a governor on growth,’’ says Brian Halligan, chief executive of the Internet marketing firm HubSpot, which has 280 employees.

“It’s a constraint in Boston, and it’s a huge constraint in Silicon Valley,’’ he said. “Right now, the alternative to working for a company like ours is to go out and start your own.’’

I wanted to share some perspectives from entrepreneurs and VCs whose thoughts didn't make it into the column. Some agree that we're seeing a start-up surplus in Boston, and some disagree vehemently that this is any kind of problem. As Carbonite CEO David Friend puts it, "What are you going to tell the next ambitious inventor or engineer? 'There are already too many startups. Forget that dream. Go back to your job at Raytheon.'"

Antonio Rodriguez, General Partner, Matrix Partners

I agree with you that [the surfeit of startups] seems to be a problem of the current boom...

I think the unfortunate consequence of all of this is going to be a whole swath of potentially really good entrepreneurs that, at best, move on to do something else after their thinly-staffed startup doesn't make it, with a hole in their resumes and at worst, burn out on the whole startup thing and go into investment banking or some equally valueless career track.

One other thought for you: this is a wildly unpopular thing to write about. When I talk to entrepreneurs, I often mention the importance of "execution context" in entrepreneurial success, arguing that it pays to go to an already humming startup for a few years to get some relevant perspective on a customer/market/etc. I think for the most part they look at me like the old guy who doesn't get that everyone can be Zuck these days.

Randy Battat, CEO, Airvana

Too many start-ups? That's a bit of a strange concept. As you know, my beef is that there are not enough anchor tech companies in Boston. But that's another topic...

My view is that it's all about supply and demand. If there is demand for engineers, there will be supply — in the long run. In the short run, there are the classic economic short-term problems. Bubbles can form, as in 1999-2000 when too many companies got funded in *every* tech space — routers, optical, search engines, B2B, mobile infrastructure, etc. There was too much money funding too many companies going after the same ideas, and very few were successful. But there were always plenty of engineers available to fill the openings.

The bloom has fallen off the engineering rose in the last few years. It's not obvious that engineering is the direct path to riches that it was a decade ago, so supply is certainly less than it was when demand felt infinite. But I don't think that's a bad thing. Supply and demand always end up in equilibrium, price being the great equalizer.

And price is really about opportunity and excitement. I've never agreed with those who whine that hiring good engineers is hard. If a company is working on interesting stuff and the opportunity is compelling, then good people will kill to join.

Too many start-ups? I doubt it. Too few really good ones? Always.


David Friend, CEO, Carbonite

There is a shortage of engineers, and I have been complaining about that for decades. And in Massachusetts, we're in relatively good shape, with MIT just around the corner. After Sputnik, it was suddenly cool to study science and engineering. Today it's not so cool, and many science and engineering majors go on for MBAs and look for work in the financial world. Too bad, because we need them to be designing products. You'd need to compile some statistics, but I doubt that the allure of startups is making a significant dent in the number of engineers available to work at companies like Carbonite.

I would never discourage anyone from trying a startup. What are you going to tell the next ambitious inventor or engineer? "There are already too many startups. Forget that dream. Go back to your job at Raytheon." I don't think so. And I don't think it's really all that easy to pry a couple hundred grand out of angels or funds. You still have to have a good idea and convince some smart people that you can actually deliver.

As for hiring good engineers at Carbonite, yes, it is hard to find good ones. There just aren't enough people studying science and engineering. With a strong anti-science current in society coupled with fast money in other professions, it shouldn't be a surprise. The best and brightest will often go where the money is (or was). Too many lawyers, too many investment bankers. I'll bet some of them are now wishing they had stayed in engineering.

John Prendergast, CEO, Blueleaf

I don't think that we have too many startups for the overall ecosystem, it's a self-balancing system. Resources go to the strongest and get pulled from the weakest. Those that fail often go on to become part of another startup, better for what they learned, and the ecosystem is stronger as a result.

For me, the larger issue is that real talent is always in short supply in concentrated markets like the Valley, Boston and New York. The best talent always have choices. In times with higher demand...the competition seems to actually change more noticeably for engineers of more average ability.

More broadly though, startups employ a relatively small percentage of the talent even in concentrated markets. The larger issue is that startups compete with large companies for talent, and that trade-off choice changes based on market conditions. In addition, needed skills change relatively quickly compared to people's training and it's particularly acute at startups, which typically work on the newest technology.

On your closing point, "Is it a constraint to growth that talent is spread too thin in Boston?" Attracting the right talent is a constraint for every company trying to innovate in every market. However, if you're a company in Boston or the Valley and you're limiting your talent search only to your local market, you're already behind the competition. The best companies search for talent globally.

Expanded co-working space at Cambridge Innovation Center opening today

Posted by Scott Kirsner October 13, 2011 02:46 PM
I dropped by the newly-expanded co-working space at Cambridge Innovation Center this morning. That's where entrepreneurs and consultants who don't necessarily need private offices can rent a desk for $250 a month. And it's also home to two "neighborhoods" — one where angel investor Bill Warner offers advice and educational programming for entrepreneurs, called the Anything Goes Lab, and another called iCollaborative, geared to students working on start-ups and funded by Battelle, the non-profit independent R&D firm. Both of those require that you apply and are admitted. With Anything Goes, members still pay the $250 monthly fee; with iCollaborative, Battelle will cover the cost for up to 30 students.

The new Cambridge Co-Working Center (C3) space is just under 5700 square feet — about twice as big as the original co-working area, which opened in 2009. (As HubSpot co-founder Dharmesh Shah notes in the comments below, the fourth-floor real estate was formerly the home of his digital marketing start-up — until HubSpot outgrew it.) The new "czar of co-working" at the Cambridge Innovation Center is Sidi Gomes, an entrepreneur and alum of Harvard's Graduate School of Design. There's a champagne toast planned at 4 p.m. today to inaugurate the new space.

Some pics:

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Sherry Zhao, who is overseeing the iCollaborative space. She says six students have already won admission to it.

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Near the entry to C3, a flat-panel TV with videogame consoles and comfy seats.

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Aside from the Aeron chairs, most of the furniture comes from IKEA.

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I am pretty sure I could eat $250 worth of the complimentary Oreos every month.

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There are bunkbeds for those who need a refreshing nap after a late night of user interface design. "Naps are a very high-productivity thing," Warner says.

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A blackboard calendar will be filled with two months' worth of upcoming events. The rolls of brown paper in the middle are intended for sketching schematics and group brainstorming.

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Entrepreneur Nick Tomarrello of Escapist was responsible for outfitting the Anything Goes Lab.

BabbaCo, parent-focused start-up with new HQ in Boston, wants to mail you activity boxes

Posted by Scott Kirsner September 19, 2011 10:44 AM
jkim1.jpgBabbaCo, a Chicago start-up that targets parents of young kids, moved its headquarters to Boston earlier this month as the result of a long-running economic development initiative that brings all kinds of talented people to the Bay State: the founder's spouse landed a job at a top Boston hospital.

Jessica Kim raised $1.2 million for the company just last month, and the very first of its BabbaBoxes began shipping last week. (Boston's NextView Ventures was among the investors in BabbaCo.)

What's a BabbaBox? It's a collection of activities geared to three- to six-year old children that you can order a la carte, or have sent to your house on a monthly basis. "The concept is that we work with preschool educators to select what goes in and develop activities, and the boxes will be customized to the age of your child," Kim says. A single box costs $30; an annual subscription is $300. Though Kim is now based in Boston, five other BabbaCo employees still work from Chicago.

jkim2.jpgThe sample box she showed me had an insect theme. It included craft materials to make a ladybug and a butterfly — and learn about their anatomy in the process. There was a plastic magnifying jar, intended for collecting bugs and inspecting them up close, and a hardcover book called "Earl the Earthworm Digs for His Life" (signed by the author.) There were coloring sheets about butterflies, and an iTunes Store credit for a specific app — Paint My Wings — that works on iPads or iPhones. Plus, there's always a small gift inside for the mom. (This box, appropriately, included some lip balm from Burt's Bees.)

"We include everything you need for the activities, too," Kim says. "I'm a busy mom, and I hate the 'batteries not included' thing." She emphasizes that the BabbaCo team strives to include products that most families won't already own: "The book we send you will never be 'The Very Hungry Caterpillar.' Everyone seems to have three copies of that already." Kim has two children, ages four-and-a-half and nineteen months. (Her husband is a hand surgeon at Beth Israel.)

While Kim just arrived in town, and just banked more than a million bucks, she has been having some introductory conversations with local VCs. "We know competitors are coming out, so I've been talking to a couple VCs now, just to know what our options are," she says. Kim seems like she's expecting some sharp elbows in the market for selling kids activities by subscription.

Greater Good founder Sung Park raising money for a beverage company with better containers

Posted by Scott Kirsner August 24, 2011 10:03 AM
No matter how healthy the bottled beverage you're drinking, entrepreneur Sung Park believes there's still one problem: the container it comes in was likely made from PET plastic, a petroleum-based material. And according to stats from the U.S. Environmental Protection Agency, there's only about a 30 percent chance that the bottle will get recycled.

"Plastic bottles last forever," says Park, who has been raising money for a new beverage start-up called Greater Good. "We're trying to create a new brand of beverage that is better for the environment, with contents that are better for you, and a company that gives back to society. We think all brands of the future will represent that." Park is best-known as the founder of Newton-based Custom Clothing Technology Corp., a pioneer of the "mass customization" movement that was acquired in 1995 by Levi Strauss & Company to crank out custom-fit jeans. He has also served as an entrepreneur-in-residence at the product design firm IDEO.

Greater Good is working on a package made from cardboard and plant materials. "The cornerstone of the product is the packaging," says Park. "It's compostable and biodegradable." The company is considering selling water and other beverages, including some fortified with Vitamin D. "It's hard to get, and incredibly good for you," Park says of the vitamin.

Park says he has assembled a group of advisors for the new venture that includes current and former executives of PepsiCo, Trader Joes, and Honest Tea, as well as Robert F. Kennedy, Jr. Early investors include John Landry of Lead Dog Ventures and Woody Benson of Prism VentureWorks. "We're still out grubbing for money," Park says.

"We believe that in every product category, there will be an 'eco' segment," Park says. "In automotive, the Toyota Prius owns that position. We're staking out an effort in the beverage category."

Greater Good is a spin-out from Umagination Labs, an "innovation factory" run by Park. It's currently operating out of the Cambridge offices of General Catalyst Partners, though Park says the venture capital firm is not an investor in Greater Good.

Car-sharing service RelayRides expands into Boston from Cambridge, adds new funding

Posted by Scott Kirsner August 17, 2011 09:00 AM

RelayRides, the "neighbor-to-neighbor" car-sharing service, is jumping the Charles this month, using $3.6 million in new funds to expand from Cambridge, where the company was founded, into Boston. The company is also expanding in the city of San Francisco, where it is now headquartered.

Unlike Zipcar, which leases the cars in its fleet, RelayRides invites car owners to rent out their cars when they don't need them. (The company was created last spring by Harvard Business School student Shelby Clark, and won a $50,000 prize in the inaugural MassChallenge start-up competition.) Clark tells me that the average car owner is earning about $250 a month by renting out a car through RelayRides, and that the company has 150 cars signed up for the service so far in Cambridge and San Francisco.

"We're starting to cover all of Metro Boston," Clark writes via e-mail. "The first car that we enrolled in Boston proper (near Boston Common) is an awesome Mercedes CLK convertible, which is available for only $8 an hour (priced lower than most standard car-sharing cars)."

Perhaps in response to recent negative publicity about Airbnb, a start-up that enables people to rent their homes — or rooms in their homes — to strangers to earn extra money, RelayRides is now emphasizing the $1 million insurance policy that covers cars rented out through the service.

RelayRides has now raised $10 million from a group of investors including Google Ventures, August Capital, Shasta Ventures, and Lisa Gansky. Several new competitors have cropped up since the company was founded, including Getaround.

Would being ranked on a 'leaderboard' change the way you work?

Posted by Scott Kirsner August 8, 2011 11:54 AM
Objective Logistics is a New Bedford start-up trying to introduce an intriguing idea to the restaurant industry — and eventually, other businesses, too.

What if waiters could see their performance relative to their co-workers every day when they checked in for work, and what if better performance meant they could nab the shifts they most wanted to work? Borrowing terminology from the world of sports, what if there were a "leaderboard" in the workplace?

"Hourly staff at a restaurant can be hard to motivate, but they can also have great energy when they are motivated," says Objective Logistics CEO Philip Beauregard, a former waiter and bartender himself. "One of the things that motivates them is that they want to name their own schedules."

Here's how it works: Objective Logistics' system, called MUSE, monitors a waiter's performance based on how well he sells. That can mean pushing the special of the day, selling bottles of wine with dinner, or encouraging big groups to order appetizers and desserts. (Eventually, the company also wants to integrate feedback from diners — after all, a waiter who foists sparkling water on a table that doesn't really want it might be driving away business.) The software grades wait staff performance on a curve: it's obviously a lot easier to gin up big checks on a Saturday night than it is Monday at 11 a.m.

The servers who rise to the top get first dibs on the shifts they want to work. That frees the restaurant manager from what Beauregard estimates is as much as eight hours a week of scheduling his wait staff. (Managers can tweak the schedule, if they want.) Beauregard, a former investment banker, and chief technology officer Matthew Grace, an ex-Oracle software developer, have been working on the concept since late 2008.

Beauregard says the software will be sold on an annual subscription basis. "We see it going beyond just restaurants, into places like hair salons, clothing stores, car dealerships, any kind of retail environment." The company is about half-way done raising a $1 million funding round, he says.

So far, the software has been tested at Not Your Average Joe's locations around the Boston area, starting in Beverly and Acton. (One of Objective Logistics' early investors was Stephen Silverstein, founder of Not Your Average Joe's.) Beauregard says he has been negotiating with other local and national restaurant operators.

At Joe's, vice president of operations Scott Flanagan says that "one or two" of the servers at his Beverly location quit because they didn't like the system. "Those were the people who were ranked down low, and the people who were performing better were getting the better shifts," he says. A future version of the software will enable servers to choose not just shifts, but also the group of tables that they serve (known as a station). "Certain stations are just better, if they include a lot of booths or they're close to the window," Flanagan says. "We now have data that shows that one station may sell $400 more food and beverages during a shift than another." A server who doesn't want to work a Friday night for personal reasons might earn about the same amount by working a Wednesday night, but getting the best station in the restaurant.

Beauregard acknowledges that the idea of making employee performance so visible — and encouraging competition as a way to control one's schedule — can be "polarizing" among servers. But, he says, "you can tell how good a waiter is by their response to the system. We had one server who was ranked #22. She'd lost her Saturday night shift. Suddenly, she was asking how she could do things better. And she started rising in the rankings, and got that shift back."

Darwinism is the newest menu item, it seems, at a dining establishment near you.

Here's a screenshot from the MUSE system:

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Highland Capital Partners announces ten collegiate start-up teams participating in 2011 'Summer@Highland' program

Posted by Scott Kirsner July 19, 2011 06:00 PM
Back in February, I let you know that Highland Capital Partners was reviving its annual "Summer@Highland" program after a brief hiatus. The 10-week program provides office space, mentorship, and a $15,000 stipend to a select group of university-affiliated start-ups; Highland doesn't take any equity in return, nor does the venture capital firm demand a right-of-first-refusal on funding.

This afternoon, Highland is revealing the ten start-ups that were accepted into this summer's program. (More than 225 applied for admission.) Six teams are based in California, and four in what will soon be Highland's new headquarters in Kendall Square.

The descriptions below were provided by Highland; I've listed the four Cambridge teams first, and added their university affiliations.

Cambridge teams:

- additup – an advertising platform designed to increase attention and drive engagement [Boston College; start-up tied for first place in the most recent BC Venture Competition]

- ByteLight – secure wireless communications through energy efficient LED lighting [Boston University]

- Tivli – building a platform to deliver TV, DVR and VOD cable services to any device over the Internet [Harvard and University of Michigan]

- Type-U – a vibrant, invitation-only health and wellness platform that helps people with diabetes live healthier and happier lives [Babson]

California teams (Highland offers space in San Francisco and Menlo Park):

- 27Bards – a site where people create, offer and go on unique tours

- AdRaid – enabling brands to reach a captive audience through innovative product placement

- Clinkle – software-based mobile payment platform

- Imprint Energy – redefining the limits of energy storage with entirely printed, rechargeable batteries

- Lemonwi.se – online product review and social media solutions for consumer facing brands

- Waddle – mobile photo-journal for groups of friends

From Highland's press release:

For 2011, teams benefit from over 40 forums and events involving top serial & young entrepreneurs and thought leaders in business, design, legal, product, talent and technology. Speakers in this year’s program include founders and CEOs from Airbnb, Dropbox, Gemvara, Quattro Wireless, RentJuice, SCVNGR, session M and WePay. Also lending their expertise are serial entrepreneurs/founders Steve Blank (“Four Steps to the Epiphany”), Desh Deshpande, Naval Ravikant (founder of AngelList) and Bill Warner, along with business & technology experts from Amazon, Engine Yard, Google, HumanLogic, IDEO, KAYAK, Russell Reynolds and WilmerHale.

Upgrading meetings: Advice from entrepreneurs, executives and investors

Posted by Scott Kirsner July 18, 2011 02:58 PM
Sunday's Boston Globe column collected advice from all sorts of places — non-profits, venture capital firms, and public companies — about how to run shorter, more effective meetings. The opening:
Two people sitting in a room is a conversation. Three is a meeting, and things start to deteriorate from there. As the number of participants grows, the odds increase that PowerPoint slides will be shown, meaningless “action items’’ distributed, pet projects trotted out, oratorical skills exhibited, and BlackBerrys checked.

Here's some supplemental info:

- From Forrester Research, a great guide to handling the different personality types that populate the typical company meeting.

- Chris Meyer of Monitor Talent on the importance of differentiating between two kinds of meetings: decision-making meetings, and more exploratory meetings.

- Vertex Pharmaceuticals checklist: do you really need to hold a meeting?

- Kayak chief technology officer and co-founder Paul English on how he approaches stand-up meetings and brainstorming sessions at the whiteboard.

- John Halamka, CIO of Beth Israel Deaconess, on "Running an effective meeting."

- How to run a 22-minute meeting, from Scott Berkun's blog.

- Finally, the best idea that didn't make it into the column came to me from Fidelity Investments. I'm not sure if anyone there uses this strategy, but here's how it goes: place a big bottle of water in front of each meeting participant. As soon as someone needs to get up to hit the restroom, the meeting is over.

If you try that at your company, will you let me know how it goes?

Taste test: Can you make crispy french fries without the deep fryer?

Posted by Scott Kirsner July 12, 2011 10:34 AM
Producing a crispy french fry without a deep fryer is one of the holy grails of food science. Last Friday, a Cambridge research company called DuraFizz invited me to lunch to taste their latest project, fresh from the oven.

I met with founder David Soane, formerly a tenured chemical engineering prof at UC Berkeley; Dan Jacques, an ex-Ocean Spray exec; and Lauren Fortin, a UMass-trained food scientist with extensive experience in "omega-3 fatty acid stabilization, snack food texture optimization, food surface adhesion, and food texture optimizatiom," according to her bio. (That's Fortin in the picture, with the lone sweet potato fry that survived the lunch.)

frenchfries1.jpgIt's tough to bake potatoes in the oven and achieve anything like a proper french fry texture, Fortin explained. And once you start dunking a potato in a Jacuzzi bath of hot oil, it gets fattening fast. What DuraFizz has been developing is a healthy french fry that tastes super-crispy, but can be baked in an oven. The customers they've got in mind aren't just restaurant chains and frozen food producers, but also schools and military installations.

The coating they've developed, which they call Oh So Crisp, uses starches and flours from corn, rice and potatoes, which form a layer around the potato itself. "The ingredients are all natural," Fortin explains, and the fries are gluten-free, too. Soane says the coating works by creating a stiff, ridgy layer that your tongue and teeth perceive as crispiness, along with pores that allow the moisture inside the potato to escape without creating sogginess. Even when you reheat the fries in a microwave, Soane says, they stay crispy. "And there are no new ingredients in the coating — nothing that would require FDA review," he says. DuraFizz is already working with Russet House, a Canadian company that produces sweet potato fries for restaurants and grocery chains like Trader Joe's, on production tests of the Oh So Crisp coating.

Fortin whipped up two samples of the fries in a convection oven, baking them at 400 degrees for 10 minutes. I tried them sans ketchup.

frenchfries2.jpgBoth the white and sweet potato fries had a crunchy coating. (That's a sweet potato fry in the picture at right.) On the white potato fries, the coating was so assertive that it overwhelmed the potato filling, and for that reason, I preferred the sweet potato variation, which had been cut thicker. They had a light, pillowy interior. But while the Oh So Crisp coating succeeded in conferring a substantial crunch, it also had a strange stickiness to it, adhering to my tongue and teeth in a way that you don't expect from a french fry. (It caked on, a bit like a candy coating would.) Fortin explained that they are working on a way to apply a thinner coating more evenly, eliminating that problem.

If a traditional, well-made fry is an A (and healthfulness isn't factored in), I'd grade DuraFizz's sweet potato fries as a solid B, and the white potato fries as a C+.

As for the calories and fat, a 100-gram serving of McDonald's french fries (slightly bigger than a "small" order) has 324 calories and 15.5 grams of fat, while the same serving size of Oh So Crisp fries has just 170 calories and zero grams of fat, according to DuraFizz. Compared to Ore-Ida sweet potato fries (190 calories and 9.5 grams of fat for a 100-gram portion), Oh So Crisp prevails, too (140 calories and 0.5 grams of fat).

It'll be interesting to see whether DuraFizz's Oh So Crisp gets adopted by the restaurant and food service industries; an earlier breakthrough from the company, instant cappuccino foam that didn't require hot steam, never took off. (Turns out that café customers will pay more for the experience and the sound of milk being frothed just for them.) For now, the only place you can taste the Oh So Crisp fries is at Arizona Pizza Company in Hadley, where a basket costs $5.49. (Regular fries there cost $2.99.) Once the Oh So Crisp coating is being made in large volumes, they predict that it won't add that much to the cost of an order of fries.

"We've been talking with the Army, universities, and restaurant chains," says Jacques. "Their big question right now is, how are you going to make enough to supply us?" He says the company is focusing first on sweet potato fries, which Jacques says have a higher profit margin. Also, sales are growing fast.

DuraFizz raised $250,000 last year from a Japanese venture capital firm, Global Venture Capital.

So Steve Jobs walks into a sushi bar...

Posted by Scott Kirsner July 6, 2011 11:30 AM
How far would you go for an opportunity to talk about your business with one of the world's best-known technology entrepreneurs?

Rajat Suri, founder of E La Carte, which is developing a tabletop ordering system for restaurants, went pretty far. (I wrote about E La Carte last October; Suri dropped out of a master's program at MIT to work on the company full-time, and later moved to California to participate in the Y Combinator program for start-ups.)

This past spring, Dave Balter, one of Suri's investors and the founder of BzzAgent, was out in Palo Alto for a visit. He and a colleague, Jennifer Fremont-Smith, had a few hours before they needed to catch a red-eye flight back to Boston, and they asked Suri about good places to grab dinner nearby. Suri recommended a sushi spot, adding, "Steve Jobs goes there all the time."

Balter and Fremont-Smith went over, and as they sat at a table, who should come in but Jobs himself, grabbing a seat in the middle of the sushi bar. They both snapped photos with their mobile phones — Jobs was clad in his trademark black turtleneck, and looked pretty frail — but didn't go over to say hello. Though Balter and Fremont-Smith are both working on a start-up together, "I didn't consider going up to him for a second," Fremont-Smith says. "It did not feel like a pitch moment to me."

But Balter did text Suri to let him know about his Silicon Valley celeb sighting, and he sent along the pic. Suri showed up at the restaurant a short while later. "It was kind of an impulsive thing," Suri says. "Maybe it's just stupidity."

Though there wasn't an empty seat at the sushi bar in Balter's photo, by the time Suri arrived, a spot had opened up right next to Jobs. Suri took it.

e-la-carte.jpgSince Suri had been to the restaurant several times before, he and Jobs chatted a bit about the menu. (Jobs touted the mackerel.) Suri just happened to have brought one of his company's tablet-like, wireless ordering devices (pictured at right) with him. He didn't want to come out and ask if he could demo it for Jobs. So instead, he put the device on the counter in front of him and started tapping through its features, which include games and digital images of food and beverages that a patron might order.

"He stopped eating his food and was staring at me the entire time," Suri says. "I was hoping that he would ask me questions, rather than my having to say, 'This is what we're working on.' But he didn't take the bait." And Suri couldn't quite find the right conversational gambit to ask Jobs for feedback on what he had built.

Suri does sound like he regrets not getting a gem or two of wisdom from Jobs, who knows a thing or two about what makes consumer electronics easy to use.

But he does note that he's had a decent track record with other interactions with tech bigwigs. Not long ago, Google chairman Eric Schmidt was visiting the company's Cambridge office to speak with employees. Suri smooth-talked his was into what sounds like a group interview session that Schmidt was conducting with several journalists, and he lobbed a few questions of his own. When the press event was over, Suri told Schmidt that he'd left MIT to work on a start-up, asked if Schmidt ever made investments in fledgling companies, and got Schmidt's card. Though Suri had several subsequent conversations with someone who helps manage Schmidt's investments through TomorrowVentures, it didn't lead to any money for E La Carte. (The company has raised over $1 million from other investors, however.)

"It's pretty easy to get to these people if you know how," Suri says. "I think that's the moral of the story."

I'm not sure I would've had the chutzpah to take the seat next to Jobs, and neither Balter nor Fremont-Smith chose to seize the opportunity.

How would you have played the situation?

Buffalo.dj, new start-up from Monster.com founder Jeff Taylor, will represent and record DJs

Posted by Scott Kirsner June 29, 2011 09:20 AM
jefrtale.jpgIs Jeff Taylor's next career objective to become the Ari Gold or Ahmet Ertegun of the DJ world?

The founder of Monster.com and Eons is setting up offices and a recording studio in Dorchester for his latest venture, Buffalo.dj. As he describes it, the company will represent, record, and promote DJs who create their own music and perform at major music festivals — not those who spin "We Are Family" at weddings and bar mitzvahs. The start-up may also produce its own concerts, and at some point stage a larger music festival.

Taylor says that through starting six companies, he has been performing as a DJ on the side — on Sirius satellite radio, the Ultra Music Festival, and various clubs in Massachusetts. (He performs both as Jefr Tale — pictured below — and as a character called STR!PE, who wears a mask. Among his favored genres: electro, house, progressive, and dubstep.) Taylor also plays at — and helps organize — the Root Society "party dome" at the annual Burning Man festival in the Nevada desert.

"New music has always been a passion for me, but this is the first time I'm really pursuing it as a business," Taylor says. "When you go to festivals like Bonnaroo or Coachella, what you notice is that they're giving bigger stages to the DJs every year, and the DJs are attracting bigger crowds. You have DJs headlining in Vegas. Games like DJ Hero are getting young kids exposed to it, and you've got something like two million people who are doing it in their bedrooms."

jefrtale2.jpgThe business is still at an early stage, Taylor says, and he's bankrolling it himself. He expects to have about five employees by the end of the summer. "I'm going to represent ten or twelve DJs to start out with," Taylor says, managing their careers and assisting with record producing. He also envisions building an "Internet talent management platform to source the best [up-and-coming DJs] and build their careers," he says. And his plans for the Buffalo.dj studio in Dorchester involve connecting top DJs with vocalists for recording sessions. Without getting into specifics, Taylor says he'll use his Internet experience to help build big audiences for the DJs with whom he works. And he notes that New England, with its scads of college students, is notably lacking major music festivals — a void he may try to fill at some point.

As for the Buffalo.dj name (and the parent company, called Buffalo Entertainment), Taylor says, "A herd of buffalo move in these graceful patterns, but with lots of noise and commotion. At a festival, you get that same feeling of being part of the herd, and watching it move."

Taylor is still best-known in the business world for creating the jobs site Monster.com, and serving as its "Chief Monster" until 2005. His next company, Eons, a social network for baby boomers, raised $32 million in funding but never achieved critical mass. (Apparently, boomers figured out how to use Facebook, and Eons was sold earlier this year for an undisclosed sum.) Eons did, however, spin off two other sites: the 40-and-over online dating service Meetcha, and Tributes.com, which produces digital obituaries (they prefer the term "tributes.") Taylor is also on the board of Sonicbids, a Boston start-up that helps musicians land gigs.

The Demo Day Dispatch: TechStars Boston start-ups presenting (and raising money) today

Posted by Scott Kirsner June 15, 2011 07:05 AM

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Today is "demo day" for the TechStars Boston program, which supplies start-ups with office space, mentorship, and a splash of cash (up to $18,000), in exchange for a six percent equity stake. A dozen start-up companies that have been cloistered away in Kendall Square office space for the past three months will present to prospective investors.

It sounds like there's strong investor interest in this year's crop of companies, which may be due to the program's selectiveness...or the seed-stage investor frenzy that's building in tech...or a bit of both. One TechStars entrepreneur predicted yesterday, "I don't think any of us will be boot-strapping after the program is over. It seems like everyone has interest from investors." Already, two local VC firms have plunked a bet down on one TechStars company (GrabCAD), and local angels are backing several others.

Update: According to my tally, as of today, the dozen TechStars Boston companies have funding commitments totaling at least $4 million.

I met with the companies back in March, but here's a quick cheat sheet in advance of demo day; presentations begin at 9:30, and I'll update this post as necessary.

- Daily Data (from Ginger.io)

Background: MIT Media Lab spin-out that aims to use mobile phones to collect passive and active data about your health and activity level. Are you exercising, experiencing new symptoms, or taking the meds your doctor prescribed? Ginger.io wants to gather this information — with user permission, of course — and sell it to healthcare and pharma companies. What is the user's incentive for participating (aside from perhaps improving one's health)? That was unclear from the team's presentation. Advisors include Frank Moss, former Tivoli Systems CEO (and ex-Media Lab director) and Bill Warner, founder of Avid Technology. Working on partnerships with Merck, Pfizer, and Cincinnati Children's.

Funding status: Seeking to raise $800,000. Warner says he has invested, but hasn't disclosed how much.

- EverTrue

Background: Co-founders hail from Harvard Business School and Boston University. Helping prep schools and universities stay in touch with alums using mobile apps and social networks like LinkedIn. (And raise money, of course.) Has generated more than $150,000 in revenue so far.

Funding status: Hoping to raise $1 million; $750,000 committed so far. Vermont-based angel investor Ty Danco and Joe Caruso of Bantam Group already involved.

- GrabCAD

Background: Founded two years ago in Estonia, GrabCAD is a marketplace site that connects people who need products designed in CAD (computer-aided design) programs with 8500 mechanical engineers who can do the work. CEO Hardi Meybaum says 7000 of those engineers have joined within the last month, and predicts that the site could represent "the world's largest engineering team" within six months. Big companies like ABB are using engineers on GrabCAD to convert old 2-D product models into 3-D, Meybaum says. Much of the GrabCAD team in Estonia consists of former Skype employees; Meybaum says that as a result of participating in TechStars, the company will make Boston its new headquarters.

Funding status: Pulled in $1.1 million from Matrix Partners, Atlas Venture, NextView Ventures, and individual angels including SAP veteran Alex Ott, TellMe co-founder Angus Davis, and former SolidWorks CEO John McEleney. The company may add more angel investors to the round, Meybaum says.

- Help Scout

Background: A trio of founders from Nashville want to make it easier for customer service or sales teams to manage incoming e-mail messages. Assign responses to particular team members, and track messages so they don't fall through the cracks. Co-founder Nick Francis says they've had the service live for almost two months now, and have signed up more than 250 users so far, including social media guru Gary Vaynerchuk of Wine Library. Pricing ranges from free to $20 per month.

Funding status: Seeking $400,000. Francis says they're "about halfway where we want to be." Boston angel investors Joe Caruso of Bantam Group and HubSpot co-founder Dharmesh Shah are involved. (Shah made his offer to invest — and got a "yes" — via Twitter, and Performable CEO David Cancel is also reportedly putting money in.)

- Kinvey

Background: A trio of University of Texas alums simplifying the development of new mobile apps by connecting them to various cloud-based services, like storage or video transcoding. They call it BaaS: "back-end as a service." More than 180 developers have already signed up for the Kinvey beta. See the TNW write-up on Kinvey here.

Funding status: Hoping to raise $1.5 million; at least $1 million committed so far from Atlas Venture, Bantam Group's Joe Caruso, and Bill Burnham, formerly at Softbank Capital.

- Memrise

Background: Co-founded by British memory champ Ed Cooke, Memrise aims to make it easy to learn new vocabulary in any language. Focusing now on Mandarin Chinese and SAT words in English (though there is also material on the site to teach Japanese, Spanish, Italian, German, and more.) Cooke jokes that the team initially planned a "smash and grab" operation — raising money in Boston and then absconding to the UK — but will now likely remain in the States for at least a year.

Funding status: Trying to raise $1.5 million. Already committed are Balderton Capital, angel investor Bill Warner, and Nabeel Hyatt, general manager of Zynga's Boston game development studio.

- Placester

Background: Helping real estate agents and landlords manage their online advertising and subsequent tenant leads. Agents pay for performance, measured by inbound e-mails and phone calls. Barba says 450 agents and brokers are already using the service. Co-founders are Frederick Townes, former CTO at Mashable, and BU School of Management grad Matt Barba.

Funding status: Hoping to raise $600,000; $325,000 already committed. (Via Twitter, angel investor John Landry offered to put money in.)

- Promoboxx

Background: Enables Web sites to run giveaways, promotions, and sweepstakes, easily and legally. Specifically focused on helping big consumer brands run promotions that drive traffic into retail stores. Charges $99 per month, per retailer that is involved in a promotion. Has run more than 400 promotions so far. TechStars Boston's lone team from New Hampshire. (They plan to remain in Cambridge after the program.)

Funding status: Raising $750,000; $250,000 already committed, according to CEO Ben Carcio. BzzAgent founder Dave Balter is among the investors. (HubSpot's Dharmesh Shah has also offered to invest in the company, via a tweet.)

- Sennexx

Background: A Web-based, private, internal Q&A application for companies, designed to help find the experts on given topics with an organization. (Remember knowledge management?) Israeli team educated at the Technion, the Israel Institute of Technology. Working with Novartis and Xerox as beta customers.

Funding status: Raising $500,000; $100,000 committed thus far.

- Spill

Background: Encourages college students to talk about issues they're grappling with — from roommate quarrels to binge drinking — and receive confidential online counseling from trained "student supporters" who've dealt with similar issues in the past. "We're bringing empathy online," CEO Heidi Allstop said in her presentation. (Allstop says there has also been interest from the military and large companies.)

Funding status: Hoping to raise $400,000, with $120,000 already committed.

- Strohl Medical Devices

Background: System for quickly triaging patients who may have had strokes, intended for emergency room use. Founder Heather Keith calls it "the EKG for stroke," intended to get stroke victims the clot-bosting drug tPa within the three-hour "golden window" following a stroke. Device is portable enough to be carried on ambulances. Intellectual property licensed from Tufts.

Funding status: Looking to raise $750,000 to launch its product.

- The Tap Lab

Background: Mobile game from two Boston University alums, Dave Bisceglia and Ralph Shao. Think "Monopoly" meets Foursquare. Of course, you need friends and virtual goods to defend properties you "own," like Fenway Park or the House of Blues. Hopes to generate revenue not just from selling virtual goods to users, but developing sponsored content for big brands. Building other games tied to real-world properties.

Funding status: Targeting $500,000, with $150,000 committed already. Harmonix Music Systems co-founder Eran Egozy is among The Tap Lab's backers.

Some other coverage of TechStars' Boston demo day (the program also operates in Boulder, Seattle and New York): Xconomy ... BostInnovation ... Bill Warner's blog ... Boston Herald ... The Next Web.

Start-ups on the side: Entrepreneurs with full-time jobs talk about the pros and cons

Posted by Scott Kirsner June 12, 2011 01:08 PM

This week's Boston Globe column looks at people starting companies as "side hustles," while working at full-time jobs. Here's the opening:

Is it possible to be an entrepreneur without sacrificing a steady paycheck?

A small subset of office workers — from State House staffers to Web designers to equity traders — believe they can temper the risk of launching a start-up by holding tight to their 9-to-5 jobs. With businesses that sell second-hand luxury handbags or iPhone apps, some are just looking to earn a little income on the side, while others hope they’ll be able to keep revenues climbing and eventually make the transition to full-time entrepreneur.

I corresponded with two other entrepreneurs who also work full-time gigs, but their perspectives didn't wind up in the finished piece. So I'm posting them as "bonus material":

- Lee Schneider, a VP at an investment management firm, who started a "green products" retailer on the side.

- Ryan Gruss, a digital asset manager at the consultancy Continuum, also runs a site for musicians.

And here are the other "side hustles" mentioned in the piece:

- Shareaholic

- Living To 100

- PaperPhobic

- decktOut

- Offshore Wind Wire

MassChallenge start-up competition picks 125 finalists for 2011

Posted by Scott Kirsner May 24, 2011 03:00 PM
MassChallenge is announcing the 125 "finalist" companies that will be part of its 2011 program today; each finalist receives four months of free office space on the South Boston waterfront, mentorship from more experienced entrepreneurs and investors, and the chance to win a slice of the competition's $1 million in prize money. Unlike other start-up programs that focus just on Internet businesses, MassChallenge attracts biotech, energy, retail, consumer product, and non-profit entrants. The organizers say their goal is to "catalyze the launch and success of high-growth, high-impact new businesses."

Here's what's notable about this year's program:

1. The competition received 733 entries from 24 countries and 34 states, up from 446 entries last year. (Interest from Israel apparently perked up after Governor Deval Patrick led a recent trade mission there.) The finalists from outside the U.S. hail from Israel, Portugal, Canada, and South Korea.

2. The finalists include companies that have already participated in other start-up programs, like TechStars Boston, Dogpatch Labs Cambridge, and the MIT $100K Entrepreneurship Competition, and that it also includes several companies that were part of MassChallenge in 2010.

I asked MassChallenge CEO John Harthorne about giving alums of his competition a second go-round. He said that any start-up that won prize money in 2010 wasn't considered eligible to return. But, he added, "Many of the teams that entered last year were very early stage — some of them just ideas. Some of those idea-stage entrants were still identifying the right target market and building out their business plan throughout the summer. While the mentoring and other benefits were extremely helpful for them during that process, it was more difficult for them to simultaneously compete against more established teams given their context. Following the competition, we felt that many of the alumni could still benefit from MassChallenge and deserved another shot at winning now that they had built out a more thorough plan." Like the other entrants, they needed to have raised less than $500,000 of funding so far, and be bringing in less than $1 million in annual revenue.

3. Last year's finalist set included 111 companies, so the program has grown a bit this year. Organizers call it the "world's largest global start-up competition."

4. The digital media and marketing trade association MITX will offer mentorship to companies participating in MassChallenge this year. MITX is also moving into MassChallenge's office space on Fan Pier, as I'd reported earlier on Twitter.

5. In the seven months since the 2010 program launched, last year's finalists have raised more than $30 million in funding and hired over 300 new employees, according to MassChallenge.

Here's the list of 125 finalists, in PDF form. The awards ceremony, at which $1 million in cash will be doled out, is scheduled for October 20th.

Globe 100 CEO Roundtable: The extended version

Posted by Scott Kirsner May 23, 2011 12:18 PM

RoundTable609.jpg

Essdras M Suarez/Globe Staff Photo

(Left to right) Johnny Earle, Jeffrey Anderson, Gail F. Goodman, and David Vieau.

For the Globe's annual Globe 100 magazine, I moderated a roundtable of four local CEOs talking about innovation. A condensed version of our conversation ran in print, but I wanted to share the longer transcript (just lightly edited) here. Thanks to Globe co-op Allison Knothe for her transcription help...

The participants were:

- Gail Goodman, chief executive of Constant Contact, a Waltham company that sells digital marketing services to businesses

- Johnny Earle, founder and chief executive of Johnny Cupcakes, a clothing chain (specializing in high-end T-shirts) based in Hull

- David Vieau, cofounder and chief executive of A123 Systems, also in Waltham, a maker of batteries for power tools, electric vehicles, and utilities

- Jeffrey Anderson, founder and chief executive of Quick Hit, a developer of Internet football video games based in Foxborough.

I opened with a question for Johnny Earle, the t-shirt mogul.

Globe: Apple has this interesting aura where they have created scarcity for the iPad 2, and people line up in front of the stores, waiting for iPads, and everyone’s excited for the white iPhone. You seem to have kind of tapped into a smiliar idea of, ‘Let’s do interesting, fun designs and make people want them.’ How do you create this demand, when every other t-shirt maker is probably cranking out hundreds of thousands or millions of units of their product?

Johnny Earle: When I first started, I was doing it just as a hobby. It was a joke that turned into a hobby, and then it turned into this brand. I was designing the t-shirts out of my parents’ house at the time, and while everyone else was going out partying, I decided to gear my time and money towards this business. I wanted it to be something that had longevity, so I chose not to sell to some stores. We had some offers from Macy’s, Nordstrom, Urban Outfitters, and even Barneys, and we just went a different route. We started numbering shirts, and once we’d sell out of something we’d never make it again. We began focusing on packaging, which I think is a big thing when you come out with a product. Growing up, we’ve all been addicted to McDonald’s at one point, because of the Happy Meals. Instead of plastic bags, we started making food boxes for our shirts, and even cupcake mix boxes for some of the releases. When you pull out the shirt, you have to dust off real flour and sprinkles.

Globe: How many shirts do you make in a typical run?

Earle: In the mid-hundreds. We sell our shirts any where from $35 to $75, and they usually sell out pretty quick.

Globe: Let’s talk about the video game industry. What would you say is the vision for the videogame cluster here, Jeff? The industry in Massachusetts is about 1300 people by the most optimistic estimates today. What is the vision? Is this going to be an industry that’s going to be 50,000 or 100,000 people, or are we investing in growing something that’s relatively small? And I presume you are for the proposed tax credit for video game companies.

FULL ENTRY

Get a grip: $2.99 Loopski keeps mobile devices from catastrophically colliding with the ground

Posted by Scott Kirsner April 5, 2011 05:11 PM
loopski.jpgIf you're like me, your mobile phone is usually in one hand or the other. You're often juggling other items, like keys, notebooks, and a briefcase. As a result, your phone occasionally has unpleasant interactions with the pavement.

To keep my iPhone safe, I bought a hard plastic case made by Case Mate — and even that has chipped a bit after four months of duty. I love the look of the case, but it does make the iPhone bulkier, and it conceals everything but the phone's screen and its essential ports.

Last week, Boston entrepreneur Naveed Ghalib started selling Loopskis, a $2.99 accessory he invented to help keep your mobile phone in your hands. ($2.99 is the introductory price, and he may increase it once the first batch is sold out.) Ghalib was kind enough to send over a Loopski that I could try.

I extracted my phone from its case and applied a piece of Velcro with adhesive to the back of the phone. Then, feeling a little like a boxer preparing for a fight, I wrapped Velcro bands around two of my fingers. When the Velcro on my fingers met the Velcro on the back of my phone, it allowed me to keep the phone from falling even if I wasn't gripping it at all.

It was easy to see how the Loopski would keep the phone in my palm — but it also made it hard to switch hands (rrrrip!) or put the phone down on the table (rrrip!). Doing either thing went from a one-handed to a two-handed job. And keeping the Loopski "Band-Aids" on your fingers when you don't have a phone in your hand just looked strange. ("Why do you have tape on your fingers?" my young son asked. "I'm not sure, son," I replied.)

Loopskis may solve a problem for those of you who insist on using mobile phones without a protective case, but I put mine aside after my brief trial run. I wish Ghalib luck — as I do to every entrepreneur who comes up with something no one else has thought of before — but I wonder if this isn't an Optigrab-type solution to the problem of holding on to your phone. (Ghalib works at a well-known Cambridge company that he didn't want me to mention; Loopskis are a side project.) Still, perhaps you'll want to be the first on your block to start the black Band-Aid trend...

Five venture capital firms sponsor free Kendall Square office space for entrepreneurs

Posted by Scott Kirsner February 28, 2011 01:42 PM

The New England Venture Capital Association and five of its member firms will sponsor free Kendall Square desks for early-stage entrepreneurs, starting March 31st. The 2,500 square foot space will be part of a new co-working facility — where numerous start-up teams share open space instead of hermetically-sealed offices — called CriticalMass that will be part of the Cambridge Innovation Center.

Nancy Saucier, a spokesperson for NEVCA, says that the five firms sponsoring the space will choose the entrepreneurs who get "golden tickets." (Others can pay $250 a month to have access to the same space.) The current sponsors will cover the costs for about 48 entrepreneurs a year to get three months of free rent, but Saucier says other NEVCA members have expressed interest in getting involved with the program, and she expects that as many as 100 tickets could be handed out annually. Sponsoring VC firms will also have conference rooms with their names on the door, which they'll use periodically to meet with entrepreneurs (but which will otherwise be open to CriticalMass denizens.) CriticalMass will also host Q&A sessions with angel investors, as well as "how to" workshops geared to entrepreneurs.

How will entrepreneurs get a "golden ticket"? They'll be doled out by the venture capital firms underwriting CriticalMass. Saucier notes that entrepreneurs who take advantage of a sponsored pass to the CriticalMass space won't be under any obligation to the sponsoring firm.

The initial sponsors of CriticalMass are Charles River Ventures, Highland Capital Partners, North Bridge Venture Partners, Bain Capital Ventures, and Flybridge Capital Partners. Many of the partners of those firms have been participants in regular "office hours" sessions that the NEVCA has held at the Cambridge Innovation Center's Venture Cafe. I'm told the idea for CriticalMass came about when Saucier, Cambridge Innovation Center CEO Tim Rowe, and Jamie Goldstein of North Bridge and the NEVCA began talking about how to take those weekly office hours sessions a few steps further.

A grand opening for the new space is scheduled for March 31st.

Highland Capital revives its summer entrepreneurship program for college students

Posted by Scott Kirsner February 3, 2011 12:52 PM

Highland Capital Partners SVP Michael Gaiss tells me that after a one-year hiatus, the venture capital firm is bringing back its Summer@Highland program for student entrepreneurs. The program will take place both in Highland's Lexington office, and in rented space in San Francisco. The goal is to have four to six teams in each location.

"We definitely think about this as an entrepreneurship program, not a seed program," Gaiss says. "That means we're really looking for teams that are three, six, nine or even twelve months away from raising a seed round."

Highland is specifically looking for tech-focused teams, which the firm describes as "SaaS, internet/digital media, infrastructure, energy efficiency, robotics, advanced materials & semiconductors."

Of the start-ups that participated in the three previous Summer@Highland programs, Gaiss says that Highland has funded two (the custom jewelry site Gemvara and video analytics specialist Affine Systems), and three others have raised money from investors other than Highland. (Fifteen teams in total have participated in prior editions of Summer@Highland.)

Each team receives a $15,000 stipend, free office space, plus access to Highland partners and the entrepreneurs in their network. Highland doesn't take equity in the companies that participate, and there's not even a requirement to give the firm first crack at funding. At least one member of each team must be a current student, or have graduated no earlier than December 2010. The application deadline is April 7th.

How Zipcar handles the snow

Posted by Scott Kirsner January 26, 2011 03:09 PM

The flakes have just started to fall — again. And in January so far, we've gotten more than fifty inches of snow.

As a Zipcar member, during the winter I always wonder: am I going to be the unlucky schlub stuck shoveling out the car I've reserved after (or during) a snowstorm?

I called Zipcar's head of communications, Greg Winter, to ask how the car-sharing company handles it when its fleet gets dumped on.

Winter says that about 60 percent of the company's cars in Boston are parked outdoors (the other 40 percent have cozy garage spots.) Once the snow stops falling, the same contractors that Zipcar employs to clean its vehicles fan out to start shoveling, "even if it's 10 PM at night," Winter says.

And if a member reserves a Zipcar mid-blizzard? Well, there's a shovel and a snow brush in every car, Winter says, and if you wind up having to do significant excavation, the company will give you a small credit toward your next reservation.

tags Zipcar

Test-swapping with ThredUp, children's clothing exchange founded in Cambridge

Posted by Scott Kirsner January 26, 2011 12:40 PM

thredup2.jpgThe arrival of a new baby brings with it the sudden explosion of several things: laundry, plush toys, garbage, enough medicines and ointments to fill a small U-Haul, and clothing that, after being worn twice or thrice, is suddenly two small.

ThredUp is a clothing swap site that concentrates on that last problem, enabling parents to swap boxes of clothing that no longer fits (but is still in good condition). The company was founded in Cambridge in late 2008 by James Reinhart, then a Harvard grad student; in 2010, it raised $1.4 million in funding from investors including Cambridge-based NextView Ventures and Founder Collective, but the company also relocated to San Francisco. I joined the service last summer, and wanted to share my experience with it so far.

ThredUp is free to join, and when you do, the company sends you a stack of United States Postal Service Priority Mail boxes; these are what you use to send clothes to other members. You're initially asked to fill a box with clothes in roughly the same size range (say, 6-to-12 months), and all for the same gender child. You describe the clothes and check off some of the brand names (Baby Gap or Disney, for instance), but you don't need to photograph each individual item. Boxes are categorized by season (is it mostly summer clothes, or winter?) and whether they include tops, bottoms, or a mix.

For every box of used clothing you list, you're able to pick a box from the site's inventory. For each swap, you pay $15.95, $5 of which goes to the company, and the rest of which covers postage.

The first box I received through the service was a bonanza: it contained a vintage-looking "Star Wars" t-shirt and a "Thomas the Tank Engine" long-sleeve shirt with a little speaker sewn in that makes a train whistle sound whenever you press the button. There were two pairs of Old Navy jeans, a hoodie, and assorted other clothes: a dozen items in all.

The first box that I'd packed was selected by another user about ten days after I signed up for the site. ThredUp instructs you to leave the box on your doorstep, and says that it'll arrange for a letter carrier to pick it up. (I ordinarily would've been inclined to just drop the box off at the post office.) From there, the box seemed to have vanished. ThredUp sent me an e-mail saying that the letter carrier hadn't found the box, and when I spoke to my friendly neighborhood postal worker, he confirmed that he hadn't picked up anything.

The site's e-mail customer service was really helpful; staffers canceled the transaction and credited my account $5 for the hassle.

But then, almost a month after I set it out on my front porch, the box was delivered to the person who requested it. (Either it was picked up and misplaced by the Postal Service, or someone swiped it, opened it, didn't have a toddler-age boy, closed it up, and re-mailed it.) As a result, the person who received the box gave me a two-star rating on the site (out of four), complaining that the box had arrived late, and that "a few items were too worn to give away," but noting that she liked the shirts and sweaters I sent. I confess: I did cram in a couple pairs of pants that were more "family hand-me-down" quality than something that you'd turn over to a consignment store. In all, there were a dozen items in the box I sent.

Last month, my son needed some extra winter clothes, so I picked another box from the site. Shopping ThredUp was, for me, a slow process; while it's convenient not to have to post pictures when you're listing a box on ThredUp, the lack of images makes it hard to find clothing that you're confident you'll like.

I did finally find a box that looked promising, and submitted a request for it last month. More than two weeks later, I got a notice from ThredUp that my pick had been cancelled. Why? A ThredUp rep explained by e-mail that "sometimes people are unable to send their boxes due to illness, family emergencies, etc." (I haven't yet tried to find another box that looks good.)

I also listed two more boxes of clothes on ThredUp in December; the process is streamlined, and it takes only about eight or ten minutes to describe what's going into your box, and then make it public so other members can see it.

But neither of my two new boxes has been picked. That could be because the site doesn't yet have enough swappers hunting for clothes, or it could be that my two-star rating has branded me with the equivalent of the scarlet letter with other ThredUp members. (Update: I've since found takers for those two boxes, and the favorable ratings on the transactions — one box I dropped off at the post office, the other was successfully picked up from my porch — improved my status on the ThredUp site.)

ThredUp did feel like a good value when I received the original box of clothes, and I like the idea of reducing my household's consumption of newly-manufactured stuff. But since that original delivery, the site it has required too much of an investment of time and effort for me to want to keep using it. (It's easier to donate old clothes to charity.) And time, of course, is the one thing no parent has in plentiful supply.

Peter Thiel, Facebook’s first big backer, thinks the future of global innovation may hinge on more entrepreneurial college drop-outs

Posted by Scott Kirsner November 15, 2010 09:03 AM

peter_thiel_headshot.jpgI had a chance to spend some time on the phone yesterday with Peter Thiel, the PayPal co-founder, venture capitalist, hedge fund manager — and early Facebook investor. He’s speaking at MIT this coming Tuesday night, at an event organized by the MIT Enterprise Forum of Cambridge.

We talked about Thiel’s new fellowship program, which will provide twenty $100,000 grants to potentially world-changing young entrepreneurs in the for-profit and non-profit sectors; why it might be better for would-be entrepreneurs to drop out of school today than it was when he attended Stanford; whether Facebook could have thrived if it had stayed in Boston; what Thiel sees as a dearth of innovation globally; and the risk tolerance of Boston investors.

(Incidentally, Facebook co-founder Mark Zuckerberg was twenty when Thiel first met him, so he wouldn’t have been eligible for the new Thiel Fellowship, which is open only to people who haven’t yet ticked out of their teens.)

Here's a very lightly-edited transcript of our conversation.

Scott Kirsner: So what will you be talking about Tuesday at MIT?

Peter Thiel: The objective is really just to give a general talk about technology entrepreneurship in the U.S. It’ll basically be a bit of an overview of my thinking about how to start companies. I’ll talk about my PayPal experience, and offer some perspectives on what I see going on in the technology industry in the decade ahead.

And I will probably talk about this fellowship program we just announced for twenty students under twenty to take a couple years off of school and work in a technology start-up-type context.

SK: You’ve gotten a good amount of criticism for the program, which some see as encouraging students to leave school. You went to Stanford, and finished, and then went on to law school and got a degree there, too.

PT: There are certainly a number of things that are quite different from when I went to college a quarter-century ago. The big issue we zeroed in on – which really hit me over the last year or so –is the extraordinary amount of student debt that people are racking up, and the ways that is effectively changing the kind of decisions they can make later in life. When you rack up enormous amounts of debt, it sort of tracks you toward the higher-paying job, but away from something that is less remunerative in the short run, but maybe more entrepreneurial – or a non profit – or something that’d be socially useful.

I think there’s a very significant set of problems around the debts people are amassing. One of my concerns is that that is starting to discourage genuine entrepreneurship. People get super-tracked toward safe things, so they can pay off their debts.

I basically graduated with no debt. I was lucky to have parents who were middle class and could pay for my education.

[For me,] there was a way in which getting educated was actually a way of deferring thinking about the future… Part of our effort is to encourage some thinking about why are people being educated – what is the purpose?

SK: Well, what about someone who is studying chemistry or molecular biology? That seems like an important foundation if you want to develop a new drug.

PT: It depends a lot on the subject matter and the field. But I’m actually not convinced that even in some of these harder technology type areas, the incremental value [of advanced education] is quite high.

SK: So you’re saying that after high school, a kid might be ready to develop an important new cancer drug?

FULL ENTRY

Continuum creates new division especially to focus on, um, more complicated stuff

Posted by Scott Kirsner November 15, 2010 07:46 AM

continuumfolder.jpgHere is a lesson in why consultants should not be allowed to give themselves advice.

Continuum, headquartered in West Newton, is one of the world's biggest "design and innovation" consultancies, with more than 180 full-time employees spread across the world. The firm helped Procter & Gamble create the Swiffer, has collaborated with Samsung on flat-screen TVs, and worked with Bedford-based Insulet Corp. to launch a wearable insulin pump for diabetics. They pride themselves on their ability to think through tough design challenges — whether building a lunchbox-sized, battery-powered testing lab that doctors can use with AIDS patients in developing countries, or figuring out how General Dynamics can better integrate communications systems into a Humvee. Continuum, once known as Design Continuum, was founded back in 1983.

Early last month, I started getting a series of e-mails from Continuum about "important news" that was on the way. A meeting was scheduled, then rescheduled.

I finally got a chance last week to hear the news directly from Continuum CEO Harry West. I was not allowed to divulge it until this morning.

Continuum is creating a new division at the company. They "prototyped it" last year. It is called Continuum Advanced Systems. It will be run by its very own general manager, Tom Merle, a Continuum employee.who has been at the firm a dozen years. It may even have its own office space someday — right next door to the rest of Continuum. What is actually different about Continuum Advanced Services? It will concentrate on "developing complex systems and technologies that are based on a fundamental understanding of people," according to a release going out today. In my one-hour meeting at the company last week, it was not really clear how CAS will be different from plain old Continuum — aside from mostly taking care of the medical and technology projects. There's no change in ownership; the firm is still privately held by Gianfranco Zaccai, one of the original Design Continuum founders, and eight members of the management team, including West and Merle.

I was handed some press information in two separate, very different gray folders: one for Continuum, and one for Continuum Advanced Services. (Pictured above.) You can obviously tell which folder contained the information for each, right?

When I followed up with West by e-mail to ask what exactly the new division would handle, he wrote, "If the client wears a tie; uses Microsoft Project; or asks about our
experience with optics, wireless protocols, regulatory requirements, or C#,
then he or she is a CAS client." Funny.

Also, I was told that while Continuum had considered changing its name, the firm decided to continue being called Continuum. They will, however, now have a new URL: continuuminnovation.com, instead of the old dcontinuum.com, a relic of the Design Continuum days.

I had to wonder how many meetings, and how much strategizing, were required to arrive at these momentous decisions.

The only actual news at our meeting last week? Last year, Continuum opened up an office in Shanghai that has since grown to about 16 people, and the firm may soon set up a branch in South America (most likely in Brazil). (Continuum already had a presence in cities like Milan and Seoul.) "About 25 percent of our business these days touches on China and South America," West said.

West says that Continuum is among the largest design and innovation consultancies on the East Coast; the compete with the larger firm IDEO, which has an office in Cambridge but is headquartered in California.

Blaze brings in $1 million from CommonAngels and Boston Seed Capital

Posted by Scott Kirsner November 8, 2010 07:09 AM

Blaze Software is a start-up obsessed with speed — and the company has been setting some new speed records in its first few months of existence.

Michael Weider left his job at IBM in late August, started raising money for Blaze at the beginning of September, and "we had it sewn up by the end of the month," he says. His Ottawa-based company just raised just over $1 million in seed capital from individuals and organizations like Lexington-based CommonAngels and Boston Seed Capital, a new firm in Wellesley run by Nicole Stata.

Blaze was created to help customers make their Web sites zippier — when viewed on PCs, mobile phones, or tablets. "With poor site performance, you lose people," Weider says. "It used to be your pages could load in five seconds, but people are now looking for two seconds or less. There's a growing correlation between how fast a site is and its business success." And if your site is slow, that can hurt its ranking on Google, Weider adds. (Here's a sample analysis the company did on my personal Web site, http://scottkirsner.com.)

Weider says that Blaze's software automagically optimizes a Web site's performance for various desktop and mobile browsers, "without having to change any of your code." The start-up had a beta version of the software, and was able to show investors before-and-after examples of how it improved sites' performance.

Also helpful, Weider acknowledges, is that his last start-up, Watchfire Corp., was acquired by IBM in 2007, for an undisclosed sum. Three Watchfire veterans are working alongside him at Blaze. "People want to invest in teams that have done it before," he acknowledges.

Though Weider only left IBM at the end of August, several other engineers had been laying the groundwork for Blaze's product for several months, including co-founder and CTO Guy Podjarny, another Watchfire vet who left IBM back in January.

Blaze now has a six-person engineering team in Ottawa, but Weider says "we'll probably open up an office in Boston for sales and marketing as we get further along."

Here's a video explainer of how the technology works. It was produced by Blaze, which has several others on its Vimeo channel:

Blaze - How It Works from mikeweider on Vimeo.

Practically Green, site that suggests environmentally-friendly products and actions, raises $750,000

Posted by Scott Kirsner November 3, 2010 10:10 AM

Screen shot 2010-11-03 at 10.09.42 AM.pngPractically Green, a Boston Web site that offers what you might call a "green lifestyle make-over," plans to announce tomorrow that it has raised $750,000 from CommonAngels and individual investors. The company was founded earlier this year by two former Boston.com executives, Susan Hunt Stevens (the former general manager for the site) and Jason Butler (formerly director of community product development.) Also coming tomorrow is an announcement about the site's first major media partnership.

Practically Green is built around a quiz that serves up a report card based on your household's current activities. Do you use an all-natural toothpase? Buy organic chicken? Have you installed a low-flow showerhead or toilet? Once the quiz is completed and you're scored in categories like energy and water usage, the site makes some recommendations about greener choices you might make. "It could be something big, like installing a programmable thermostat," Stevens explains, "or something small like switching to an all-natural dish detergent." The site has a database of more than 400 specific actions to recommend based on the results of the quiz.

The site also integrates social networking, allowing you to compare your rankings with friends, and, Stevens explains, "if you commit to taking an action, you can share that with a friend, which makes you more likely to follow through."

Practically Green's business model is built around pay-for-performance advertising and sponsorships. If your score on the quiz earns you the "natural baby" or "green kitchen" badge, for instance, that might be sponsored by a relevant brand. And companies will pay Practically Green lead-generation fees for consumers that the site sends their way. Someone, after all, wants access to all those consumers who suddenly want to install new toilets or thermostats.

Joining the board as the result of Practically Green's first round of funding are Chris Sheehan of CommonAngels and John Landry, a CommonAngels member and investor with Lead Dog Ventures. (Stevens had previously worked at Abridge, a New York collaboration software company where Landry served on the board, and she is on the board of Xconomy, a Cambridge-based media start-up, with Sheehan.) Also investing in this round is bacon baron Stephen McDonnell, CEO of New Jersey-based Applegate Farms, which markets organic and natural meats. And Eric Hudson, founder of Waltham-based Preserve Products, which makes consumer products out of recycled plastic, is joining Practically Green's advisory board.

Practically Green launched a beta in May with a test community of 100 mothers (they cleverly dubbed the group "the Mother Board"), and opened the site to other users in late June. The start-up is currently operating out of Back Bay office space loaned to it by the PR firm Elevate Communications.

Fig Card seeks to make it super-simple to pay merchants with a mobile phone

Posted by Scott Kirsner November 1, 2010 12:27 PM

Fig Home Screen.pngI had a chance last Friday to try another mobile payment system developed here in Boston. This one is called Fig Card, from the dynamic South End developer duo of Max Metral and Hasty Granbery, who previously built Povo, a wiki site that collects information about neighborhoods.

Paying with your mobile phone feels novel and cool, and one of the great promises that the techno-future holds for me is that I will no longer have to tote around my two-inch thick wallet, jammed with cash, receipts, credit cards, Charlie Cards, ZipCar cards, and various loyalty cards. Fig Card is developing an app (initially for iPhone and Android) that will allow you to pay for a purchase at a local merchant, get a digital receipt, and chalk up points in the store's loyalty program (for instance, giving you an eleventh coffee for free after you purchase ten.)

Of course, swiping back and forth on your phone's screen in search of a payment app could simply replace today's acts of jingling around in your pocket for correct change, or hunting through a wallet for the right credit card.

Metral and Granbery have an office on Appleton Street, and Metral also lives nearby, so it's natural that the spot they've chosen for a pilot test of Fig Card is the Appleton Bakery Cafe. They told me they've had lunch there almost every weekday for the last two months.

While Granbery was installing a beta version of the iPhone app on my phone, Metral purchased a couple cookies and a coffee to show me how the app worked. When he opened it, he first punched in a four-digit code for security, and then the app displayed a green button that said "Ready to Pay." After the cashier had rung up the order, Metral clicked the button, and an itemized bill showed up on his phone. (Metral's photo also popped up on the cash register's screen, to give the cashier a way to verify that the phone's owner was paying the bill — a second layer of security.) It offered him the opportunity to add a tip, and then click "pay," which completed the transaction. Fig's servers charged his credit card, sent information to the cash register that the transaction was complete, and filed a digital receipt away in his phone.

When I set up the app on my phone, it asked for a credit card number, a four-digit security code, and a photo that would allow cashiers to identify me as the rightful user of the Fig app. It took less than a minute. I went up to the cashier to buy a pound of coffee beans, and except for fumbling for a second to find the "next" button that would advance the transaction, everything went smoothly. The app offered me a screen where I could sign my name as an extra level of anti-fraud protection (this feature wasn't on Metral's phone, which was running a different version of the app.) My iPhone wasn't connected to the store's WiFi, but just the wonderful AT&T 3G wireless network.

cashregister.jpgMetral explained that from the merchant's perspective, the only hardware required is a $5 WiFi antenna that plugs into a USB port in the cash register. (You can sort of see the WiFi antenna in the picture at left, between all the cables.) When you open the Fig app, it looks for nearby cash registers using the system. When you click "Ready to pay," the cash register sends you the bill that's currently on its screen. (The phone and register don't talk directly to each other, but rather the phone sends info over the wireless network to Fig's servers, and then Fig's servers in turn communicate with the register.) Metral says the system is every bit as secure as using a credit card, except that "the one security hole is that if you're standing in line with a friend, and you click 'Ready to pay' before they do, you could pay their bill for them." Metral adds that your encrypted credit card information is only sent to Fig's servers once — when you initially set up the app — and that it is never actually sent to the merchants cash register.

The Fig app, unfortunately, isn't yet available for anyone to use. (They're submitting it to Apple's app store this week, so it may show up soon.) Metral and Granbery say they're hoping to raise some money — in the neighborhood of $500,000 — so that they can integrate Fig with all of the major cash register (or "point-of-sale") systems. They say they have a list about about twenty local merchants who've expressed interest in using it. And they've also got a list of features they plan to add: tagging receipts ("Client lunch with Jeff," for instance), allowing users to rate specific items on a restaurant's menu, or enabling one person to pay for a group and then automatically send e-mails to others to request their share. Metral, a co-founder of Firefly Network, one of the earliest online recommendation start-ups, also envisions being able to suggest dishes that are popular this week, or cocktails that you're likely to enjoy based on what you've bought and rated highly in the past.

They say that merchants who allow customers to use the Fig app for payment will pay the same for a credit card transaction as they do today — about 2.5 percent to 3 percent. Their expectations are that by building up enough transaction volume, they can get a discount from payment processors, and earn money on the spread. Eventually, Metral says the company could charge additional fees for helping merchants manage loyalty programs.

Later this month, Metral and Granbery are bringing on Dave McLaughlin to assist Fig Card with business development. McLaughlin was previously the founding executive director of Boston World Partnerships, a non-profit created by Boston mayor Thomas Menino to encourage the growth of entrepreneurial businesses in the city. Now, McLaughlin will try his hand working for one.

Seems to me that Fig Card is the kind of business that needs to get a bunch of merchants using it (and loving it), and garner some favorable buzz — and then get acquired by a company that needs a mobile payment solution and already has relationships with millions of retailers and restaurants. In other words, speed is of the essence...

xPeerient, connecting IT executives with service providers and one another, launches with nearly $2 million in funding

Posted by Scott Kirsner October 28, 2010 08:30 AM

Let's say you're a CIO with a problem: you need a services firm to help you roll out desktop virtualization software to 5,000 employees, or to get the inventory system in your retail stores communicating with your e-commerce site. How do you find one that'll fit the bill? (Assuming that you don't want to hire any of the vendors who wine you and dine you and treat you to leisurely rounds of golf?)

Boston-based xPeerient, launching today, hopes to supply a solution by creating a marketplace where chief information officers and other executives who spend money on technology can explain their needs, and then anonymously screen the service providers who say they can help. The company has raised nearly $1 million in angel funding and another $1 milion from Waltham-based Stage 1 Ventures.

"We think of it as eHarmony for the IT industry," says founder Mark Hall. "The buyer can post a project anonymously at no cost, ask questions of the candidates, and create a short-list."

Hall says that online and print advertising to senior IT buyers just doesn't work anymore: "They've become incredibly desensitized to advertising. So we're trying to use technology to bring the buyer and the seller together at the right time."

About 5000 "partners" (like systems integrators, value-added resellers, and other service providers) are already participating in xPeerient's marketplace. Participation is free initially — they pay only for the opportunity to communicate with a prospective customer once they've made it to the short-list. Hall says the company will charge vendors a fee of "a couple thousand dollars for a $2 million deal, for instance, and the pricing is tiered based on the size of the deal." Hall also says xPeerient can provide value for IT executives by connecting them with one another on the site, so they can share advice with peers who may be embarking on the kind of project they've been through before.

Hall says xPeerient is still a virtual company, with 12 full-time employees but no office. Until late 2008, he was the chief information officer at Framingham-based CXO Media (publisher of CIO Magazine and other titles); he started xPeerient in early 2009, and began beta testing the site over this past summer with about 25 customers. He raised just under $1 million in angel funding for the company, from investors like Roy Rodenstein of Hacker Angels, Dennis Philbin of Lux Research, and Kevin Laracey, founder of edocs (and until recently an investor at Sigma Partners.) The company's Series A investment closed at the end of September, from David Baum at Stage 1. "We didn't want to do an equity round until we got the product built," Hall says.

MassChallenge, For the Win: Cultivating All Kinds of Great Start-Ups (Not Just Webby Ones)

Posted by Scott Kirsner October 21, 2010 09:35 PM

OK, I was totally wrong about the MassChallenge.

harthorne2.jpgWhen John Harthorne (at right, in the yellow tie), Akhil Nigam and their team were running around town trying to drum up support for a competition that would bring start-up companies to Boston from around the world, my response was: do we really need another entrepreneurship contest? Doesn't every local school with a business class or two, from MIT to Babson to BU to Harvard, already run a contest of their own?

It also seemed unlikely that they'd be able to raise $1 million in prize money in the midst of a recession.

And when they announced the 111 teams that made it into the competition — and would receive free office space on the Boston waterfront and mentoring from local entrepreneurs and investors — they included a handful of start-ups that seemed to me like they were on life support, having failed to raise money or come up with a workable business plan.

But by the time tonight's final awards ceremony was held, I'd been converted. The MassChallenge, mainly funded by businesses and individual philanthropists though also supported by the state with about $500,000 of seed money, fills an important role in the local scene. While university business plan competitions encourage students to consider starting companies (and have spawned local successes like Akamai), there isn't much for post-collegiate entrepreneurs.

Sure, you can apply to get into an accelerator program like Y Combinator or TechStars. But many of those programs have a distinct bias for Web and software ideas — products that can be built and launched quickly with very little capital. 

boger.jpg

What made MassChallenge work well is that it attracted founders of energy, life sciences, software, hardware, and retail businesses. It attracted founders fresh out of business school, and at least a couple in their 40s and 50s. 

Of tonight's winners, some are already up and running and generating revenue, and some are still in the prototype or testing stage. Tonight's event felt, as does TechStars and the MIT $100K Entrepreneurship Competition, like a community coming together to support entrepreneurs in pursuing their vision. (Among those who made the competition possible are people like 170 Systems co-founder Karl Büttner, A123 co-founder Desh Deshpande, and Vertex Pharmaceuticals co-founder Josh Boger, pictured at left with Greg Bialecki, the state's secretary of housing and economic development.) And handing out $50,000 or $100,000 apiece in prize money to 16 companies ain't bad either: a little financial boost, without having to part with equity.

The MassChallenge wound up being global, not provincial (they scrapped a requirement early on that would've required all entrants to agree to relocate Massachusetts after the competition ended.) As a result, it attracted support from Russian investors and entrepreneurs from Israel. And it gave many of the community's successful entrepreneurs, investors, lawyers, and PR consultants an opportunity to help guide the up-and-comers. 

rentabilities.jpg

There was a really nice moment that I caught as the awards were being handed out — the obligatory giant cardboard checks. Shelby Clark of RelayRides was heading back to his table from the stage, having just won $50,000 for his car-sharing start-up, launched earlier this year in Cambridge. I was standing next to Zipcar chief executive Scott Griffith, who is preparing to take his Cambridge company public. Clark looked over to Griffith and caught his eye.

That's the kind of Massachusetts I want to live in: one that is building industry leaders like Zipcar, and also cultivating the next wave of innovators, too, to keep them on their toes.

[...A few more pics follow...]

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Eric Paley of Founder Collective and Elon Boms of Launch Capital.

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Olivier Boss, chief scientific officer of Energesis Pharmaceuticals, a $50,000 winner.

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Derek Ohly of Zyrra, a $50,000 winner, with Howard Davidson and Michel Ohly.

MassChallenge finalist JoyTunes endeavors to make learning a musical instrument as much fun as a videogame

Posted by Scott Kirsner October 20, 2010 10:56 AM

What makes a great demo?

For me, it's a product that actually works (or at least looks like it does), and that does something you've never seen before. And a back-story about why you developed the product always helps, too.

I finally got a chance to see the demo from JoyTunes last week. They're an Israeli start-up that has been participating in the first annual MassChallenge start-up competition this summer and fall. (An hour or so after co-founder Yuval Kaminka gave me the demo, MassChallenge announced that JoyTunes had made it into the final round of judging, which takes place Thursday.)

Kaminka told me that after watching how intently his 7-year old nephew played with his Nintendo Wii, and contrasting that with how unmotivated he was to practice his recorder no matter how much his mother harangued him, he began thinking about how to blend the two activities. Collaborating with his brother Yigal — a professional oboist — they developed JoyTunes. (The third JoyTunes founder is Roey Izkovsky, a buddy of Yuval's from the Israeli army.)

The concept is pretty simple: instead of a strumming a fake plastic instrument a la "Guitar Hero," music students play a real recorder into a microphone connected to a laptop or PC. The pitch, volume, and duration of the notes they play controls what happens on the screen. Play properly, and you advance in the games on the screen. Miss a note, and you don't. The software costs $35.

The game was developed in Israel, and Kaminka discovered the MassChallenge competition through a random Google search. As a result of participating, he says the company will maintain a sales and marketing presence in Boston even after the competition concludes this week. JoyTunes hasn't yet raised outside funding. The game launched in Israel earlier this year, and in the U.S. in August. (In addition to the Hebrew and English versions, there's also a German version in the works. Germans, he explains, are pretty serious about music education.) Kaminka says that after recorder, the company plans to develop versions of the game for flute and clarinet.

Here's one demo video:

And a few others are on YouTube.

(Two guitar-based videogames, PowerGig and Rock Band, both developed in Boston, also enable players to use real instruments, but the games are not focused on teaching elementary music principles... yet.)

Generating buzz for your venture: 43 bits of free advice from entrepreneurs, PR peeps, and journos

Posted by Scott Kirsner October 19, 2010 11:17 AM

Understanding how to generate buzz is a crucial entrepreneurial skill — especially for ventures that haven’t raised jillions of dollars to spend on advertising or giant trade show booths. At last week’s MassTLC Innovation Unconference, a group of PR pros, journalists, social media experts, and entrepreneurs got together to collaboratively create this list of 43 ways to generate buzz in both traditional media and social media. It’s not a definitive list by any standard, and I don’t agree with 100 percent of it, but it collects a number of perspectives about how to get free ink for your company.

I’ve edited the original list to try to make it more useful than the rough notes from the session (which were kindly taken by Richard DiBona of Episend), and added some advice that I found myself dispensing after the session to people who stuck around. When I recall who made a given point, I’ve attributed it.

1. Know what your message is. What is important about your company and how are you going to talk about it? Have a brainstorming session to talk about how best to present your story.

2. Who are you trying to reach? Investors, prospective employees, users, CIOs? That should influence the blogs and media outlets you focus on.

3. You only get a chance to launch once. There is no “undo.”

4. Your outreach efforts shouldn’t involve contacting every single journalist and blogger you know at the same time. Be selective about who you contact, and think about it as a “retail,” one-to-one conversation, not spamming.

5. Don’t ask a journalist, “How can I get you to write about my company?” That’s like asking an investor, “How can I get you to give me money?” There needs to be some romance…intrigue…storytelling…or a demo to get them interested.

6. If you’re targeting consumers, getting on morning shows (like “The Today Show”) can be really effective. (Meg O’Leary, Inkhouse.)

7. Three quarters of the word “news” is “new.” Product launches count, but product updates (version 2.3) are usually not that relevant. Funding, new executive-level appointments, major new customers, or new office space can be considered news-worthy events. (Doug Banks, Mass High Tech.)

8. Many journalists say that meeting you in person at an event is a much better way to get a sense of whether they want to write a story than getting an e-mail or a phone call. Just like the sales process, you’ll often find that you need to follow up on an e-mail with a phone call, or catch a journalist or blogger in the hallway at a conference, to make sure you get a few minutes of their attention.

9. Position yourself as part of a trend that’s happening – explain,“this is how we relate to this trend.” It’s hard for reporters to write about companies that claim to exist in a marketplace vacuum.

10. Be able to tell your story in 30-60 seconds – be “Clear, Concise, Compelling.” Messaging is an exercise in cutting back, not saying more.

FULL ENTRY

MassChallenge start-up competition: Down to 26 start-ups

Posted by Scott Kirsner October 14, 2010 08:32 PM

Next week, the 26 start-ups below — plucked from an original applicant pool of 446 — will be vying for $1 million in cash prizes, as part of the inaugural MassChallenge start-up competition, which has brought entrepreneurs to the Bay State from places as far-flung as Israel, California, and North Carolina. Judges of the final round will include Nantucket Nectars co-founder Tom First and Constant Contact CEO Gail Goodman. (You can read the official press release here.)

As it happens, I've written about nearly one-third of the finalists over the past year, many before they entered the MassChallenge competition... links below to those stories and blog posts.

- 3Play Media
- 7Solar Technologies, Inc.
- Abroad101
- Architexa
- Aukera Therapeutics, Inc
- Brass Monkey
- Embed.ly, Inc.
- Energesis Pharmaceuticals
- JoyTunes
- Ksplice
- Locately (formerly known as Cadio)
- Novophage
- OsComp Systems
- OsmoPure
- Pearl’s Premium
- Relay Technology Management, Inc.
- RelayRides (and my experience using the service)
- Rentabilities
- Samanta Shoes
- ScholarPro Inc.
- Seeding Labs
- Sproxil
- StorageByMail.com
- Symmetric Computing
- ViThera Laboratories
- Zyrra

More advice on raising money, for first-time entrepreneurs

Posted by Scott Kirsner October 10, 2010 07:27 AM

Today's Globe column collects advice from local investors and entrepreneurs about raising money — specifically for first-time founders.

People shared far more insight with me than could fit into the printed column, so I'm posting some "bonus material" here.

- David Beisel, Founder, Web Innovators Group; partner, NextView Ventures

The one piece of advice I most often share with entrepreneurs fundraising is: tell a story. Even the most analytically-driven investor will ultimately base his decision on an emotional connection to the vision of the company. Fundraising shouldn't be just telling the what and how of the endeavor, but also the why. Of course all of the fundamentals must be in place for the company to succeed; but the deeper a narrative is intertwined in the pitch, the more likely an investor will become excited about the human element which is inherent in every startup.

- Laura Rippy, board member and advisor to start-ups; former CEO, Handango; former GM, Microsoft

...One [piece of advice] is to take a page from investment bankers' playbook and "make a market". Prepare your pitch, your network, your targets beforehand. Reach out simultaneously to multiple investors. Then, create a sense of urgency so that multiple offers line up at the same time. It makes you look like a hot property and is the best strategy for a good valuation, best ancillary terms, and full syndicate. I have seen a few entrepreneurs take a slower serial approach instead, and backfire, as the first investors get tired of waiting.

- Angel investor Joe Caruso of Bantam Group

Entrepreneurs too often think their first task is to raise money......and waste a lot of time during the early months of their venture pitching an incomplete idea to people who need a lot of convincing....

Instead, much of that time is better spent convincing customers.... or at least talking with prospective customers. The feedback from them... the questions and suggestions.... will be somewhat similar to the kinds of conversations they have with prospective investors, but will be FAR more productive.

1. The feedback will be knowledgeable
2. You will learn a lot if spend more time asking questions than "pitching" your product/service
3. As your offering morphs, and you get a few people interested, you might get some early revenue (or at least early commitments for revenue)..... which will make money raising MUCH easier....

While not an accurate algorithm, I suspect what initially might be a 6-9 month money-raising effort, if preceded by 6 months of customer activity, will become a 90 day money-raising effort..... making overall time to raising money about the same, but you'll have a company with a vetted product, and maybe even some market traction....

...Entrepreneurs waste too much time pitching something unproven to the unreceptive....

- Christopher Mirabile, managing director, Race Point Capital Group

(1) DO: Research and network your way to potential investors. DON'T: Contact investors cold.

(2) DO: When pitching, set the table before jumping in - tell a story about who your customer is, and why your product helps them in a compelling way. DON'T: Jump into the middle of a detailed discussion of product features

(3) DO: Have some skin in the game, a rough prototype, and some solid market data. DON'T: Shop a PowerPoint business plan from the cubicle of your full time job.

- Jeffrey Bussgang, partner, Flybridge Capital Partners; author of "Mastering the VC Game"

A “do” would be establish both credibility and a relationship – investing is a game of trust and investors want to know that you know what you are doing, can trust you to do the right thing, and will enjoy sitting beside you during the wild roller coaster ride.

A “don’t” would be to oversell. There is a tendency for entrepreneurs to exaggerate or spin in order to sell prospective investors. There’s almost never a happy ending in those situations – either before or after due diligence is completed.

One story that sticks out in my mind – after signing a term sheet and before closing, one entrepreneur called me to tell me that his technical co-founder was moving out of the country for personal reasons. He was understandably nervous to tell me about it, but by proactively letting me know the news and his adjusted plan going forward, he earned my respect and, eventually, the investment.

- Dharmesh Shah, angel investor and co-founder, HubSpot

1. DO Be honest with yourself and talk to someone that's done it. Very few ideas and very few entrepreneurs are venture-fundable. If you don't fit the profile, you are going to experience unnecessary pain and frustration and most importantly take time away from actually building the business.

2. DON'T raise venture capital as a response to a competitor raising a large amount of funding. Although it's scary when that happens, in practice, their odds of beating you don't dramatically change as a result of the additional capital. Focus on your strength (which may just be that you're scrappier, hungrier and care about customers more). Remember, raising money does not create value -- it simply provides the opportunity to create value. For example, for my first startup, we had 3 competitors that all raised over $25 million in funding. We were terrified. We hadn't raised a penny. Two of the companies cratered and the third we acquired for less money than I had spent on my car (granted, it was a nice car -- an Acura NSX).

- Paul Maeder, Managing Partner, Highland Capital Partners

1. Create scarcity. The best way to raise $15m is to ask for $7m. The
best way to raise $0m is to ask for $15m.

2. Say you are only looking for ONE new investor. They will think it's
a race and work hard. If you say you are looking for 2, they will wait
until someone else commits, which will never happen.

3. You need to have 3 purportedly independent, trusted people tell the
VC it's a hot deal before you ever call him. You need to "Pre Buzz"
your deal.

4. Presentation: If you can't manage a meeting, I expect you won't be
able to manage a company. Right number of slides, topics are Mgt.,
Mkt., Product, Deal in that order. 1.5 hours in total. End on time
having covered all your key points, including banter about sports with
the partners.

5. The best meetings never get to the slides.

6. Remember, you are selling your company, not your product.

7. Objective of the first meeting: a second meeting, and nothing more.
Stop selling once you achieve that. The happiest dinner guests are
those that leave the table a little hungry for more.

- Bob Metcalfe, general partner, Polaris Venture Partners

My fundraising for 3Com in 1980 turned more productive in 1981 when I finally got that VCs wanted me to tell them how they were going to get their money BACK. I had focused on what I would do in the unlikely event that they gave it to me.

Do not run on about what [jerks] you think all those other VCs are.

Do not ask a VC to sign an NDA because your idea is way too easy to steal.

Do not explain how you plan to be capital efficient by having your Dad rent you the space and your wife be CFO.

Do start the meeting by thanking your VC for inventing Ethernet, even if it was before you were born.

- Brian Shin, CEO, Visible Measures

You need to decide on a funding route: 1) bank loans/credit cards 2) friends and family 3) angels 4) angel groups / super angels 5) venture capital - it largely depends on how much money you (and your team/advisors) think you need to raise based on your vision and your plan.

It also depends on your risk tolerance & your tolerance for pain. Simple rule for me is this: If you want to go big, and go fast, and you know you're going home if it doesn't work, then try to raise Venture Capital. If you are going to most "formal angel groups" then imho you might as well go for venture capital since it's practically the same level of diligence for less money. If you have an in with some so-called super angel or micro-vc (in boston that'd likely be Founder Collective or NextView Ventures) then I'd take that route over an angel group (easier diligence, faster process). If you can get a check from a legit angel (someone who has done an angel investment before in a true tech startup), I would almost always take it b/c it validates, takes a little pressure off of you, and the first money in is always the hardest money to get.

No matter the route, these tips apply:

A) Think about "building the onion" - adding layers to your pitch such that you are constantly improving and building momentum. Have a hole in experience? Recruit a partner or an advisor. Not sure about the market need? Talk to prospects. Want to validate the solution? Get a customer. Bottom line is that you want to the building blocks (big market, big idea, strong team, aided by a convergence of market trends making it seem like you MUST start this company now), combined with a perceived trajectory.

B) Don't be unrealistic or greedy - pushing valuations up or trying to solve for retaining a certain amount of equity should not be key goals. Your goals should be to get the best partner and get the best funding terms possible (liquidation pref, participation, drag along, board, etc).

C) Create competition. Investors see a lot of deals and are looking at a lot of stuff or working on other stuff all the time. There needs to be a sense of urgency. Competition for a deal creates urgency. Part of the supposed "AngelGate" situation was folks talking about how competitive deals have gotten. A good deal should have multiple suitors. That is the best possible situation for a startup. But again, don't focus too much on getting a sky-high valuation. The higher the valuation, the harder your job is going to be and the higher the expectations. I'd rather set the expectations low and go from there :)

D) Solve for the best long-term partner for the business: you really do have to pick the person (angel, vc or otherwise). Do your homework. It's OK to ask for references from a VC.

E) Have a coach - an advisor or a friend who can be your Yoda...investors look at a lot more deals than you have ever pitched, so you need a little guidance to off-set.

F) Negotiate everything before signing a term sheet. if you have competition for a deal, you can ask for stuff before you sign. Once you sign, you are sort of locked up with that investor for a while...all the leverage shifts away from you. So ask early and often. But see point B above :)

My picks for Boston Region Entrepreneurship Week events

Posted by Scott Kirsner October 8, 2010 08:07 AM

Next week is the meatiest part of Boston Region Entrepreneurship Week, being held for the first time.

Joe Caruso, an angel investor and start-up advisor, had the idea to create an umbrella atop a few big events happening just after Columbus Day, to highlight entrepreneurial activity around Boston, across all industries. The concept took off quickly over the summer, and what Caruso had dubbed BREW grew into what should more accurately be called BREESAMO: Boston Region Entrepreneurship Events Spread Across the Month of October.

Caruso has been an investor in companies as diverse as Coffee Connection (acquired by Starbucks), Softricity (acquired by Microsoft), and Constant Contact (publicly-traded.) His Web site also candidly lists, with a skull-and-crossbones, those portfolio companies that bit the dust.

Right now there are north of 100 events on the BREW calendar. Here are my picks of the ten that look most promising to me, in chronological order.

1. Entrepreneurship in the Life Sciences, October 12th

UMass Boston's Venture Development Center hosts a schmooze-fest and panel discussion.

2. Take Flight!, October 12th

Fundraiser supports The Engineering School, a Boston public high school. Donate $5, design your own paper airplane, and fly it against others for a chance to win prizes. (I'll be there, flying an airplane along with folks like Avidyne CEO Dan Schwinn, Mass High Tech editor Doug Banks, and Mary Lockshin of Zink Imaging.)

3. Using PR and Social Media to Generate Buzz for Your Startup, October 13th

Free panel discussion at a law firm's downtown offices, featuring local journos and social media guru Paul Gillin, author of "Secrets of Social Media Marketing."

4. MassTLC Innovation UnConference, October 14th

What's an unconference? It's a gathering where the participants create the agenda at the beginning of the day, and where attendees are encouraged to be actively engaged in each session — not just listeners. This one features a roster of industry experts who will sit down throughout the day for one-on-one meetings with the entrepreneurs in attendance, offering advice and guidance.

5. Harvard Business School Entrepreneurship Forum, October 14th

Staples founder Tom Stemberg discusses his career as an entrepreneur, board member, and investor, and a panel of four women founders share their learnings. Free.

6. Powered Up Boston, October 14th and 15th

Boston's videogame community gets together for a conference and expo, featuring speakers from Quick Hit, Linden Lab, Turbine, Harmonix, and Rockstar New England.

7. "How I Got Funded," October 19th

Free eventing panel discussion with the founders of SocialSci, Localytics, Assured Labor, and Retroficiency.

8. Brewing Your Business Dream, October 20th

Excellent: a BREW event at an actual brewery. The Samuel Adams Brewery in Jamaica Plain is the site of a free seminar on marketing, PR, managing cash flow, and more, designed specifically for entrepreneurs in the food, beverage, and hospitality industries.

9. MassChallenge Final Awards Ceremony, October 21st

Which of 111 start-ups will take home the big money in this first-ever entrepreneurship competition? The prize pool is $1 million in cash, divided up however the judges seem fit. Entrants are working on everything from airborne wind turbines to online music education sites to customized women's shoes.

10. MIT Elevator Pitch Contest, October 27th

What better way to hone your own elevator pitch — the way you'd describe your business in 60 seconds or less, with no visual aids — than by watching a dozen entrepreneurs do it on stage? A handful will win cash prizes. Free.

What'd I miss that looks good to you? Comments welcome...

Harvest Automation wraps up $5.3 million funding round, brings on two prominent robotics CEOs as advisors

Posted by Scott Kirsner September 27, 2010 08:00 AM

Charles Grinnell believes that every farmer needs a few good robots working his acreage, and this morning, he's announcing that he's wrapped up a $5.3 million first round of funding for his Billerica start-up, Harvest Automation.

The company, which once tested its prototypes in a greenhouse behind Grinnell's Groton home, initially had trouble finding financing to develop a robot strong and rugged enough to move potted plants around as they grow in nurseries. Harvest says that its initial target market will be the largest growers in the $4 billion wholesale ornamental plant market, I.E., the kind of company that grew that ficus tree sitting in the corner of your reception area. These plants get moved a lot from the time they are tiny seedlings to when they head for the marketplace, and Harvest's robots are designed to take over that manual labor. The company has conducted a few field tests of the robot, but Grinnell says they'll begin a more formal alpha test in the early part of 2011.

The new funding is the biggest investment so far for Cambridge-based Founder Collective, which joins other investors including the Massachusetts Technology Development Corp., Life Sciences Partners and Cultivian Ventures (formerly known as the Midpoint Food and Ag Fund.) Joining Harvest as advisors are iRobot CEO Colin Angle, and Mick Mountz, CEO of Kiva Systems, a Woburn company that makes a robotic order fulfillment system for warehouses. (Harvest's chief technology officer is Joe Jones, who led the development of the Roomba robotic vacuum cleaner when he worked at iRobot.)

"I think Harvest as a company really plays to the strengths of Boston," says Eric Paley of Founder Collective. "There aren't that many people with the expertise to create these complicated hardware-and-software systems." Paley says Harvest reminds him of the start-up he ran after business school, Brontes Technologies, which developed a 3-D imaging system that helped dentists create better crowns and bridges. "We pitched 40 VC funds, and had trouble raising money," he says. "It was a pretty weird niche, but there was a very specific customer with a very specific return-on-investment." (Brontes was acquired by 3M for $95 million.)

Harvest's belief is that growers will turn to robots to improve their productivity while lowering costs — and that robots can reduce the risks that some growers face of hiring undocumented workers and facing enforcement actions and fines.

I wrote about Harvest's technology back in 2008, and shot this video of their prototypes:

Pongr invites you to snap pictures of your favorite brands, get promoted to CEO

Posted by Scott Kirsner September 23, 2010 08:45 AM

Screen shot 2010-09-23 at 7.42.53 AM.pngIn the same way that certain people aspire to become the FourSquare mayor of their favorite coffee shop, will they vie to become the "CEO" of their favorite brand? Pongr, a Boston start-up planning a big promotional campaign during Advertising Week next week, hopes so.

Playing Pongr doesn't require an app on your mobile phone — you just snap a photo of an advertisement or product, and either e-mail it or text it to the company. Sending in a photo of your favorite Ben & Jerry's flavor after you've demolished a pint of it, for instance, might get you a reward from the company (like 10 percent off your next purchase), or it might help you gain status within Pongr's system. Your goal is to ascend the corporate org chart from intern to CEO. Pongr founder Jamie Thompson says that the photo-based game is a way for marketers to identify the biggest fans of their product, and build relationships. And through the magic of social media, of course, Pongr players can also share the photos they've taken with friends, generating even more brand awareness.

"People already like to take pictures of themselves with brands," Thompson explains. "So if you're a Sephora enthusiast, and you're inclined to take your picture in front of their lipstick poster, with Pongr you can do that and see if Sephora is going to give you anything in exchange."

Pongr's image-recognition software examines the photos that are sent in, comparing them to pictures in its database, and then it generates a scripted response, whether it is more information about the product, a special offer, an entry in a contest, or just status points on the way to becoming CEO of that brand. (Thompson says that you can take pictures of ads, objects, logos, or even TV commercials, and have Pongr's software identify what's in the image...as long as it's part of the company's database.) Thompson says that taking a picture of something is much more elegant than having companies plaster barcodes or QR codes on everything and then asking consumers to scan the code with their phones. (But how well and how consistently the company's image recognition technology works will be key; I haven't yet been able to test it.)

The company, founded in 2008, originally planned to use its image recognition technology to help shoppers conduct price comparisons on products, and either buy an item in the store or online through the shopper's mobile phone. But the price comparison space started to get crowded, and so the company began to focus on how marketers could better connect with consumers through photos taken on mobile phones.

The company's slogan is "The picture-sharing game with real-life rewards."

Thompson says Pongr recently raised another $500,000 from angel investors, including Chris Maeda, former CTO at Kana Software. The total funding Pongr has collected, Thompson adds, is "just under one million." The company has nine full-time employees, spread across Massachusetts, Connecticut, and Iowa. Last month, the company worked on a promotional campaign with Hearst's Marie Claire magazine to give readers more info about products featured in the September issue.

And next week, they'll be demoing the game to ad agencies and marketers at New York's Gansevoort Hotel, as part of Advertising Week.

Here's a zany company video that offers an overview of how Pongr works:

Cambridge company getting ready to mark $100 million raised for charities

Posted by Scott Kirsner September 22, 2010 08:15 AM

When I first wrote about a start-up called CMarket, in October 2003, it was a little company challenging eBay for supremacy in the world of online auctions to benefit non-profits.

Since then, the Cambridge company has raised $30 million (from investors like Morningside Technology Ventures and Canaan Partners)... grown to 42 employees...changed its name from the generic-sounding CMarket to BiddingForGood.com...and generated $98.5 million for various non-profits. Company founder Jon Carson tells me that they plan to mark the $100 million milestone early next month with a party.

carson.jpg"What we'd initially developed was a tool for non-profits to put their auctions online, for the 90 percent of people who couldn't make it to the fund-raising gala to bid on things," Carson says. "And what we found is that the philanthrophy sector turned out not to be early adopters." He says it took the company nearly four years to run its first 1000 actions, and just over a year to do the next 1000.

On the site today, you can bid on things like a guitar autographed by Justin Bieber; a VIP tour of the U.S. Capitol, followed by lunch with a Senator; or an aerial tour of the New Hampshire seacoast.

BiddingForGood charges non-profits $595 for a year's access to the site, and also takes a percentage of each successful sale (for the first $20,000 in sales, the company's take is nine percent, and it decreases until the $90,000 mark, when it disappears entirely.) While many charities round up their own auction items, BiddingForGood also offers to provide auction items — it sources them in bulk — and in those instances, it takes one-third of the sale price and passes along two -thirds to the charity. As an example, Carson says the company secured 1500 one-week vacations at a resort in Cancun, which charities can offer as part of their auctions.

Carson says the latter part of the year is BiddingForGood's busiest time. "We typically have 400 or 500 auctions happening simultaneously in the fall, and December is the big month," he says. With charitable giving down over the past year, Carson hopes that more non-profits will look to online auctions to make up that revenue.

As for eBay, Carson says, "They've been the best of all competitors. They're out there, and they have two people who work in this space [non-profits]. But it is the age-old story of a specialist innovator picking off a corner of the generalist's market."

And on the subject of profitability, Carson explains that his company turned cash flow positive earlier this year. But, he writes via e-mail, "we raised $2.5M of growth capital in the spring and this summer turned the spend up (5 new sales reps for the AIRS item request system, testing NPR campaign this fall, adding auction sales reps, more engineers to work on mobile app, etc). We’ll spend that thru 2011 and then be back to profitability in 2012 presumably with a stronger market position."

Taste-testing Proportions dog food, which you can customize online for your pup

Posted by Scott Kirsner September 20, 2010 03:00 PM

Screen shot 2010-09-20 at 2.24.13 PM.pngDoes your pooch deserve a higher-quality dish of dog food?

Brad Bishop, general manager of the canine business at Plymouth-based SmartPak, says that most American dogs (like their owners) consume too many carbs, and as many as one-third are obese. His solution? Replace kibble and canned food with a well-balanced meal of that includes white meat chicken, dried fruits and vegetables, and a tasty pumpkin broth.

“Kibble is basically dough that is fried, and then sprayed with synthetic vitamins to make up for the nutrient loss,” Bishop says. “What we’re doing is taking a lot of carbohydrate calories out of the meal, and replacing them with high-quality protein.”

SmartPak launched its Proportions brand of dog food this past spring. It can be customized online, based on your dog’s breed, activity level, and reproductive status (spayed, neutered, or not), to supply the ideal number of calories at each meal. You can also upload a photo of your dog, which appears on the packaging, along with her name. Depending on the size of the dog, each meal costs between $1 and $3. SmartPak purchases the ingredients from other companies, like Tewksbury-based WellPet LLC, and assembles the individual meals at its Plymouth facility.

With 225 employees, SmartPak’s main business is selling nutritional supplements for horses, and all kinds of other equine supplies and gear. The company says it operates the biggest equine catalog retailing business in the world, and not long ago, SmartPak began expanding into canine merchandise. “We realized that about 90 percent of horse owners also have dogs,” says Paal Gisholt, SmartPak’s CEO. And of course, the number of dogs in the U.S. (60 million) dwarfs the number of horses (about nine million.)

Gisholt says that the primary investor in SmartPak, founded back in 1999, has been Waltham-based North Bridge Growth Equity, which has put about $30 million into the company.

The company is targeting the Whole Foods shopper with the Proportions brand. (They describe Proportions, in fact, as "whole food nutrition for your dog.") “It’s for people who believe that their dog is a member of the family, and want to feed them consistently with their belief,” says Bishop. After rhapsodizing about the hand-carved, hormone-free, human-grade white meat chicken included in the meals, Bishop popped a morsel in his mouth.

That felt like a dare, so I decided to give Proportions a try myself. (See the video below.)

Proportions offers a two-meal trial pack through its Web site for free. It has also been promoting the food at farmer’s markets, with Internet search advertising, and through incentives that it offers to dog groomers, pet sitters, and trainers. Bishop says the company may soon offer the option to have nutritional supplements included with the food packages — like glucosamine for joint pain.

You can see my reaction to Proportions in the video below, but I also wanted to see what an actual dog thought of the food. So my sister, who owns a Goldendoodle, requested a free sample of Proportions through the Web site. Her dog scarfed it up, and so she ordered a four-week supply of the food — and also received another four weeks free through a promotion.

“I liked having Willow’s picture on the box, and the food really looks like people food,” she told me, adding that Proportions’ customer service reps were helpful on the phone. She said the food, at $144 for a four-week supply, was about as expensive as the Beneful brand food she already gives the dog. But she wasn’t sure she intended to sign up for the monthly shipments of Proportions. “It just seems more expensive when you’re paying for four weeks of the Proportions at once, as compared to when I buy a couple week’s worth of food at Target and it’s mixed in with all my other stuff,” she said. (I should perhaps add that she is not a Whole Foods shopper.)

Here's the video of my visit to SmartPak HQ in Plymouth.


Attention, all you crusty old doughnuts of the Massachusetts innovation economy: Show up or shut up

Posted by Scott Kirsner September 16, 2010 10:20 AM

Listening to Governor Deval Patrick address a room full of venture capitalists last week, one string of comments bugged the heck out of me. The governor said that CEOs of big tech companies like EMC and Cisco, in comparing Massachusetts entrepreneurs and investors to their California counterparts, have told him that we:

  • Are too insular
  • Don't give entrepreneurs a second shot after a failure
  • Don't network enough.

The "spirit of collaboration is not as robust" here in Massachusetts, the governor said.

I wanted to jump out of my seat. What crusty old doughnut still thinks any of that is true?

(Instead, I turned to Jamie Goldstein of North Bridge Venture Partners and said, "Someone needs to remind the governor how many times Ric Fulop failed as an entrepreneur before he started A123 Systems," the battery company that North Bridge backed, and which was the most successful IPO of last year.)

Here is how someone living in the year 2010 and participating in this region's innovation economy sees things: we collaborate, converse, connect, and mix it up with a vengeance seven days a week.

Last Saturday, you could've been part of the packed crowd at MIT for Startup Bootcamp, soaking up lessons from successful entrepreneurs — including A123 co-founder Fulop. This past Monday was the 27th meeting of the Web Innovators Group in Cambridge, which brings together about 500 people to see demos from start-ups. Last night, you had Mass. Innovation Nights, an entirely different collection of demos. As part of programs like MassChallenge and TechStars Boston, start-ups get a chance to be mentored by an impressive bullpen of successful executives and entrepreneurs. At the annual Innovation Unconference organized by the Mass Tech Leadership Council, there's a lengthy roster of experts who'll offer advice to the entrepreneurs in attendance. (Funny, but no one from EMC or Cisco participates in any of those events.)

Next month, we've got FutureM Boston and Boston Region Entrepreneurship Week back to back. One emphasizes all of the activity around new approaches to marketing, and the other will feature a couple dozen events for start-uppers — and both are packed with so many events that it'll be tough to choose what to attend.

And earlier in September, Boston was named the top city for innovation anywhere in the world by an Australian research firm.

All this leads me to conclude that there are two kinds of people in Boston right now.

There are the crusty old doughnuts who like to keep repeating the same old garbage about how Boston is too insular... doesn't network enough... doesn't tolerate failure. All that may have been true the last time they were actually connected to reality — two or so decades ago. Unfortunately, a lot of these people (likely senior execs at some of the state's bigger tech companies) seem to be filling the governor's ear with this obsolete data.

The second group of people actually go to an event or two every month to make new connections and share what they know. The more experienced folks among them think nothing of sitting down with an entrepreneur for an hour (maybe at OpenCoffee or the Venture Café) to offer some feedback and advice about a nascent business plan.

That first group is mired in the past. They're crusty, and getting staler by the minute. While they may have the dough to donate to Governor Patrick's re-election campaign, their outmoded take on the innovation economy here is not worth listening to.

That second group is shaping the future here. (Maybe we should call them the fresh, warm croissants. Isn't that so much better than a crusty old doughnut?) The new culture of entrepreneurship and creativity they're establishing — no, have already established — is about openness, sharing, and swinging for the fences. It's a culture of continual improvement, too, focusing on the things we can do better to retain the smartest students who come here to get degrees, and grow small start-ups into industry leaders.

You are welcome to be part of this new culture if you want. We'd love to have you.

But if you opt out, as lots of people with well-paying, secure gigs at technology companies will likely do, here's my one request: kindly stop jabbering on about the past.

Okay, doughnuts?

Is your smartphone the next killer videogame controller?

Posted by Scott Kirsner September 13, 2010 10:13 AM

brassmonkey.jpgOne of the cooler companies demoing at tonight's Web Innovators Group gathering in Cambridge believes that a computer keyboard is far from the ideal videogame controller. Brass Monkey, a spin-out from the Boston-based software development shop Infrared5, thinks that smartphones work much better.

Just hold your iPhone horizontally with two hands, and you can fly spacecraft or drive race cars, thanks to the phone's built-in accelerometer sensor (newer iPhones also include a gyroscope), which relays information about its position and movement via WiFi to your computer. "We think the future of the user experience is people interacting with screens in new ways," says CTO Chris Allen, pictured above. "You don't have to buy special gloves or anything. We said, 'Let's take the thing you already have in your pocket and use that as the input device.'" The Brass Monkey system requires that you download an app to your iPhone, but there's no download required on your computer; the phone can control a game that's being played in most major browsers.

To show what smartphones can do as game controllers, Brass Monkey "sister company" Infrared5 developed a game called "Star Wars: Trench Run" last year, under license from Lucasfilm. You can use your iPhone or iPad to fly the Millennium Falcon, shoot down TIE fighters, or try to destroy the Death Star from behind the controls of Luke Skywalker's X-wing. What's surprising is that there's basically no perceptible delay between your movements and what happens on the screen.

Eventually, the company envisions the Brass Monkey software deployed to enable multiple players to play the same game using different smartphones. (An Android version of the controller is nearly done, Allen says.)

The next game to use the Brass Monkey controller will likely be a driving game released as part of a promotional campaign for a major car maker. The company is also actively talking to other game companies about licensing the Brass Monkey software development kit for their own games. But one challenge will be the simplicity of many of the popular Web-based games these days: do you really need an iPhone controller to tend your virtual peas in Farmville?

Brass Monkey was one of the 100-plus finalists selected in the inaugural MassChallenge start-up competition. So far, Brass Monkey has been self-funded. The start-up is led by Jim Bull, a co-owner of Strategic Marketing Partners, a firm that helps market and distribute videogames.

Aeris founders: IPO scarcity will continue, and acquisitions will remain the most viable exit for software companies

Posted by Scott Kirsner September 8, 2010 10:03 AM

aeris.jpgI sat down yesterday with the two founders of Aeris Partners, the newest mergers-and-acquisitions advisory firm in town.

The firm has been taking shape since earlier this year; its principals are Stephen O'Leary, chair of the Mass Tech Leadership Council and a former entrepreneur-in-residence at General Catalyst, and David Joncas, who until last month was co-head of technology investment banking at Harris Williams & Co, working out of the Boston office. Back in the dot-com heyday, the two worked together at Waltham-based Broadview International, which was acquired by Jeffries & Co. in 2003. (O'Leary is on the right in the photo above, taken yesterday at their office at the Cambridge Innovation Center.)

Aeris intends to provide M&A advisory services to all kinds of software companies, the founders say, from analytical software to healthcare IT to e-learning to payment technology to energy management. While their sole office for now is in Cambridge, they plan to work with companies in markets like Louisville, Atlanta, and Little Rock, Joncas says, "where you can find great technology-based firms."

O'Leary notes that "the IPO market is down 80 or 90 percent, compared to where it was pre-Internet bubble, and that's not a statement about the value of technology companies. It's the market." Assuming there's an appetite for IPOs, the surviving investment banks want to focus on taking companies public that have an enterprise value of $300 million and are looking to raise at least $100 million, says O'Leary, who left General Catalyst last fall.

That means that most up-and-coming software companies will get acquired instead, by a major player that has already built a sales force, established distribution partnerships, and created a trusted brand. I asked Joncas and O'Leary to list some of the more active acquirers of Boston-area tech companies, and their list included Oracle, IBM, Microsoft, Hewlett-Packard, Cisco, Symantec, and EMC. Apple and Dell, they said, have both done high-profile deals recently (acquiring Quattro Wireless and EqualLogic, respectively.)

As I was talking with Joncas and O'Leary, I could see the Cambridge offices of ITA Software, now in the process of being acquired by Google (assuming the anti-trust authorities give their OK.) We discussed the possibility of Akamai, another company within a stone's throw of Aeris' office, being acquired. Joncas and O'Leary speculated about possible buyers, from IBM to Cisco to HP to EMC.

"I keenly hope Akamai doesn't get acquired," said O'Leary, sounding like he was wearing his Mass TLC chairman's hat.

Even EMC, the biggest tech company in Massachusetts, is occasionally the subject of take-over rumors. "I don't think any [Boston tech companies] are untouchable," Joncas said. "It's not a bad thing necessarily. It's just a statement of fact." (Yes, I found that a bit depressing.)

If the economy improves, O'Leary predicted, "we may get to 20 or 30 IPOs a year. But it won't be 100 or 200."

That, they hope, will create an opportunity for one more M&A firm that helps promising young companies find deep-pocketed new parents.

DormNoise aims to help college students manage chaotic schedules

Posted by Scott Kirsner September 8, 2010 07:37 AM

Between club meetings, classes, hockey games, and study groups, college students have a lot of demands on their time.

Few entrepreneurs understand the scheduling chaos with which students must cope better than Jay Rodrigues. The Rhode Island native and founder of DormNoise is today starting his senior year at the Wharton School of Business at the University of Pennsylvania. Rodrigues, 21, launched the company, which offers an online calendaring system for colleges, just after he finished high school at the Wheeler School in Providence.

jayrod.jpg"On any given day, I'll get probably 15 or 20 e-mails about events at Penn," Rodrigues says, "and that's not including e-mails from friends. On top of that, people will hand you printed fliers when you walk around campus, or a friend might text you about a study group." DormNoise collects everything in a single online calendar, from big campus events like the homecoming parade to small gatherings like a group working on a course project together, which can be synced with a user's smart phone or a calendar system like Outlook or iCal. Students can also be alerted about events via text, if they belong to a given group — like a last-minute marching band practice, for example.

Sold as a hosted application, universities can either pay a fee of about $2 per student to use DormNoise, or allow the company to sell corporate sponsorships to their application, and use it for free. (Colleges can also choose to blend those two options, paying less per student and perhaps even generating some revenue through the sale of corporate sponsorships.)

The company recently signed Bay State College in Boston and Newbury College in Brookline to three-year contracts. Rodrigues says DormNoise has raised $500,000 $950,000 in funding so far (some of the earliest came from his father, who runs a textile dyeing and printing company in Fall River.) The company operates virtually, with a half-dozen employees scattered around Massachusetts, Pennsylvania, and Florida. "We're gearing up to raise more money to bring everyone to one location," Rodrigues says, perhaps as soon as January. Both Philadelphia and Boston are under consideration.

Here's a company-produced video demo:

Can Textaurant make restaurant waits less annoying?

Posted by Scott Kirsner September 7, 2010 11:44 AM

Textaurant founder Josh Bob tells me his Waltham start-up has just landed its first big customer in Boston: Finale Desserterie & Bakery. Textaurant's technology allows restaurants to use a laptop to manage their list of customers waiting for a table, sending out a text message to let customers know when one becomes available. Finale will be using the system at the local chain's two busiest locations, in Harvard Square and Boston's Theater District, starting later this month.

You can already see Textaurant's system in action at Cafe Luigi in Bedford, and the Right Fork Diner on Martha's Vineyard. Bob says that the Right Fork Diner began using Textaurant just before July 4th, "and they were handling about 400 people a week day."

Instead of writing your name down on a yellow pad and hollering it out when your table is ready, or handing you a buzzing pager that limits where you can wander, Bob says that hosts using the Textaurant system simply type your phone number into an Internet-connected laptop. A few minutes before your table is ready, you receive a text message. "You can go anywhere you want," he says. "You can go to the bar next door, or you can go home and take a nap."

Textaurant charges a monthly fee of roughly $50 to use the system, and a small per-party fee for every group that is seated. Bob's goal is to undercut the prices of rival systems from companies like JTECH and OpenTable that also allow restaurants to manage a waitlist. But those players, with their big sales forces and established relationships with national chains, will be formidable competitors for Textaurant. My sense is that the Waltham company, which has been funded by "friends and family" thus far, will have to build a great product, and fast, and hope to be acquired by a more established provider of restaurant technology.

Next up is an enhancement to the Textaurant system that will let you put your name on a restaurant's waitlist via their Web site, without having to show up in person first. Working alongside Bob at Textaurant is Dan Pickett, formerly director of engineering at Second Rotation (the company that became Gazelle.)

"Right now, we're almost exclusively focused on Boston restaurants," Bob says, "but we've had some discussions with national chains. We think Finale will open up a lot of doors for us." (Red Stripe, a Providence restaurant, will also begin using the Textaurant system later this month.) He says the company's "white whale" prospect is the Cheesecake Factory, where hour-long waits aren't unusual.

Textaurant pitched at the first Open Angel Forum in Boston back in June, and the company will be demoing at BizTechDay in New York later this month.

Backupify seeks to bring peace-of-mind to the cloud computing realm

Posted by Scott Kirsner September 6, 2010 08:08 AM

Would you start to sweat if you accidentally deleted a crucial spreadsheet you’d toiled over using Google Docs? Would your spouse wail if someone hacked into your Flickr account and deleted the years of vacation photos you’ve uploaded there?

Safeguarding an extra copy of files that you keep on Internet-based services is the simple idea behind Backupify, a start-up born in Louisville, Kentucky that moved into new offices in East Cambridge last week. The company offers a free service for consumers who might want to make sure they have an extra copy of that video they uploaded to Facebook, and a paid offering geared to businesses, many of which are required by regulations to archive something as seemingly innocuous as a Twitter message. The free offering stores up to two gigabytes of data, and the higher-end paid offering, at $60 a year, stores up to 25 gigabytes of data and makes a new back-up copy of everything once a week.

The company is planning to announce a $4.5 million A round this week, led by two Cambridge investors: David Orfao of General Catalyst Partners and Rich Levandov of Avalon Ventures (that’s on top of just over $1 million the company had raised previously). Also investing in the A round are First Round Capital and Lowercase Capital, founded by former Google executive Chris Sacca.

Backupify CEO Rob May says the company is mainly acquiring customers through social media, PR, and the Google Apps Marketplace. When Web-based services like QuickBooks go down temporarily, or the note-taking service Evernote loses some customer data, that only helps get people focused on the downside of storing their data on someone else’s servers. But May says that most of the times when someone has an experience that makes them grateful for having signed up with Backupify, it’s user error: they’ve accidentally deleted something important.

Backupify already can stash a copy of data from services like Blogger, Photobucket and Gmail. The company is working to make its backups of Facebook content (like a company’s Fan Page) more complete, and May says that a link to SalesForce.com and Evernote are in the works. Where does Backupify stockpile all of its data? Yet another cloud service: Amazon's Simple Storage Service.

The company is also developing its own API (application programming interface), to enable other cloud-based services to easily integrate with Backupify, adding data to the service or pulling data from it. One example May cites is a new start-up that wants to create online accounting software: it might find that prospective customers are more likely to try it if they know a copy of their data can be stored with Backupify. But another is enabling Backupify users to write code that would synchronize data between two Web-based services, or move their data easily from one service to another, dropping SugarCRM, for instance, in favor of SalesForce.com. “We are starting to position ourselves as less of a backup company, and more of a data liberation company,” May says.

The company now has three employees in Louisville and seven employees in Cambridge, where it plans to hire five or six Rails developers and database gurus with experience with the Cassandra distributed database.

Backupify’s first angel investor, in 2009, was Dharmesh Shah, co-founder of the Cambridge marketing software company HubSpot. Shah had previously bought a small application that May had written, which tried to analyze the value of a user's Facebook account. When May built the prototype of Backupify, which stored only Twitter messages, he e-mailed Shah to get his feedback. “It was really a side project,” May says, “and I never thought I’d raise money for it.”

Shah’s feedback was positive. "We chatted about the idea a few times," Shah writes via e-mail, "and ultimately, I agreed to put $25k in to help give him that final nudge" to pursue Backupify full-time.

The company began its move from Louisville to Boston in the spring, shacking up for a while in unused office space at General Catalyst’s Harvard Square offices. May says that one reason that Boston was more attractive to the company than New York or San Francisco is that many potential acquirers and distribution partners are here, including EMC, Iron Mountain, and Carbonite.

While the company began by targeting consumers, Backupify’s strategy now focuses mainly on enterprises. “We want to be the market leader in office productivity backups for SaaS offerings,” says May.

Water-wood? Clips from the Watertown animation cluster

Posted by Scott Kirsner September 3, 2010 02:41 PM

This Sunday's Globe column looks at some of the animation studios clustered in Watertown (and Boston, too), which produce work for the Web, TV, and mobile devices. Here are some samples:

- The show that started it all: "Dr. Katz, Professional Therapist," which debuted on Comedy Central in 1995. The show was produced by the animation division of Watertown's Tom Snyder Productions, which was later dubbed Soup2Nuts.

Dr. Katz
DVD Exclusive - Laura's New Used Car
www.comedycentral.com
Big LakeA New Comedy from Will Ferrell and Adam McKayIt's Always Sunny in Philadelphia

- Jim Lehrer interviews WordGirl, the hyper-literate PBS superhero created by Soup2Nuts, headquartered at the Arsenal on the Charles in Watertown:

- TV ad for the Jay Peak ski resort, by Clambake Animation in Watertown:

- Fizzy's Lunch Lab, from Cloudkid (which just moved from Watertown to Boston. I wrote about Cloudkid's recent Emmy nomination here.)

- The Zebrafish series of Webisodes, produced by Boston-based FableVision for Childrens Hospital Boston.

- Animation demo reel from 360KID in Watertown.

- Work samples from Waltham-based Handcranked Productions, which focuses on mixed media and stop-motion animation.

Moontoast, a 'social commerce' start-up spawned by Nashville's music scene, heads to Mass.

Posted by Scott Kirsner September 1, 2010 11:10 AM

moontoast.pngWhen a Tennessee start-up hires a Massachusetts-based chief executive, as Moontoast did last month, it means one of two things: either the new leader is going to be racking up scads of frequent flier miles, or the company is soon going to set up an office in the Bay State.

In the case of Moontoast, the second scenario is playing out. New chief executive Blair Heavey is subletting space for the company in Andover, and company co-founder Marcus Whitney has moved north from Nashville. The company is also hiring for a handful of marketing, infrastructure, and user experience positions.

The "social commerce" start-up aims to make it easier for entertainment and media companies to find fans of their properties wherever they may be spending time online; deliver content; and ideally, entice them to buy stuff. "It's a huge pain for a musician or a magazine to be able to keep fans and subscribers engaged both on their own sites and throughout social media sites," Heavey says. "And they also have revenue problems. They want to be able to monetize their content, wherever a fan base is, with things like exclusive offers and special member benefits."

The company describes its three software-as-a-service offerings as "branded communities, embedded stores, and private sale clubs."

Last month, Moontoast announced a partnership with Big Machine Records, a Nashville label whose roster includes Rascal Flatts, Trisha Yearwood, and Taylor Swift (whose Moontoast-powered Web site is pictured above.)

Heavey says the company has "funding commitments" of up to $5 million, but that they've been collecting money in "seed increments" of about $1 million at a time; most recently, the company pulled in $780,000 last summer.

Investors so far include country stars Vince Gill and Wynona Judd, according to Venture Nashville. Other Moontoast backers include the Martin Companies of Nashville; Stephen Collins, formerly CFO at DoubleClick; and Joseph Glaser, founder of a Nashville company that makes and repairs musical instruments.

Heavey says the company plans to maintain an engineering presence in Nashville, where about seven people work. Moontoast will likely move its Massachusetts headquarters from Andover to Boston or Cambridge within the next six months. At some point in 2011, Heavey says the company might seek additional investment from a strategic investor in the media or entertainment sector, or a traditional venture capital firm.

Heavey was an early executive at OpenMarket, the pioneering Cambridge e-commerce firm, and BeFree, the affiliate marketing company; both went public back in the dot-com era. More recently, he served as an entrepreneur-in-residence at North Bridge Venture Partners and CEO of My Perfect Gig, an online recruiting service funded by North Bridge and Commonwealth Capital Partners.

Figuring out your own eyeglass prescription? PerfectSight Opticals may soon have the app for that

Posted by Scott Kirsner August 31, 2010 10:00 AM

I've been hearing good things about yet another MIT Media Lab spin-out, PerfectSight Opticals, which comes out of work done at the lab's "Camera Culture" group.

A group of four Media Lab researchers developed a plastic lens assembly (cost: $2) that can clip onto the front of a mobile phone. When a user looks through the lens at the mobile phone's screen, she sees a set of parallel lines. She presses keys on the phone to make the lines overlap, and in about two minutes, the phone displays the proper prescription data. (See the videos below.)

The project won a $5,000 award at last spring's MIT Ideas Competition, and a small team working to commercialize the technology also was chosen as a finalist for the MassChallenge start-up competition this summer. The team says that "uncorrected refractive errors" (near-sightedness and far-sightedness) affect about 600 million people, and are the second most common cause of blindness worldwide. As you might expect, the majority of those people live in less-developed countries, where there isn't a Lenscrafters on every corner, and where the lowest-tech equipment for diagnosing eye problems still costs around $100.

Leading the venture are Chika Patrick Ekeji, a Sloan School of Management student who'll finish his MBA next spring, and Vitor Pamplona, a visiting PhD candidate at the Media Lab.

Ekeji writes via e-mail, "We are working on productizing the prototype...We are in discussions with several potential partners in that regard, and our current plan is to have a [Version 1] product available in six months or so."

The company isn't yet actively raising money, though Ekeji says they may talk with some individual angel investors soon.

PerfectSight doesn't yet have a Web site, and when I e-mailed with Ekeji earlier this month, he said they hadn't yet incorporated.

Two videos about the original MIT project, below:

[ Second video is from the Media Lab's LabCast series, by Paula Aguilera and Jonathan Williams. ]

Driving thy neighbor's car: My experience with RelayRides

Posted by Scott Kirsner August 25, 2010 08:40 AM

relay.jpgWhen I needed wheels for a quick trip to Plymouth yesterday, I didn't reserve at the nearest Avis location or grab a Zipcar from one of their designated spots. Instead, I popped the locks on a neighbor's car when he wasn't around and took off. It was cheaper than the other two options.

While it sounds absolutely illicit, borrowing a neighbor's car when it isn't being used is the concept behind RelayRides, a Cambridge start-up company that I wrote about earlier this year. Instead of leasing a fleet of vehicles like Zipcar, RelayRides finds people who have underutilized cars and wouldn't mind earning a little money with them. Car owners pocket some of the hourly rental fee paid by RelayRides members, with the company taking a percentage for facilitating the transaction and insuring the drivers; RelayRides also installs the necessary technology in each car.

The company has been running a pilot test this summer in Cambridge and Somerville, with a few dozen vehicles. I signed up for a membership in late June, and received $25 worth of free rental credit for doing so. A few days later, a membership card arrived in the mail. Embedded inside was an RFID chip that would give me access to the RelayRides fleet.

I perused the RelayRides site a few times in July and August — at one point hunting unsuccessfully for a minivan or large SUV that could fit seven people. It wasn't until this week that the stars aligned and I made a reservation. Since there are no RelayRides cars in my immediate neighborhood, I needed to wait for a day when I had the extra time to walk about twenty minutes to a car parked near Porter Square, just across the Somerville line. (Google Maps pinpointed the parking spot as exactly one mile away, though the RelayRides site claimed the distance as 0.66 miles.)

After deciding against renting a car that was described in member reviews as exuding a distinct eau du pooch, I booked a neighbor's 2003 Toyota Matrix from 10:45 AM to 3:00 PM. (RelayRides offers pet-friendly and pet-free vehicles. The Matrix displayed the pet-free icon.) The car's hourly rate, including gas and insurance, was $7.00.

Here's my take on the pros and cons of the experience.

Pros:

The biggest advantage to RelayRides is cost. My rental totaled $35.33; the use of a newer Toyota Matrix a bit closer to my home with Zipcar would've cost $49.14 (Zipcar's rate for that vehicle is $9.25 an hour, though Zipcar offers discounted rates to members who commit to spending at least $50 a month with the service). RelayRides also lets you reserve cars in 15-minute increments, while Zipcar limits you to half-hour chunks. With Zipcar, that policy would've forced me to pay for fifteen minutes that I didn't need.

I found the car easily, even though it wasn't in a marked spot, and I waved my membership card over a sensor on the windshield. The locks popped open. Inside, I found a key to the ignition, and a note from the owner informing me that I was their first renter. "We're really excited to be part of this new venture," the owner wrote. He also apologized that the driver's side window didn't work (there was a Band-Aid over the button that would've opened it), and said he'd made an effort to get it repaired. Clipped to the note was a $4 "rebate" for my rental (in folded bills), which I decided not to take. On the passenger's seat was a tote bag full of maps. In the tape deck was an adapter that enabled me to plug in my iPhone so I could listen to my own tunes. There was just over one-third of a tank of gas in the car. Though the carpets hadn't been vacuumed recently, the interior was relatively clean.

Unlike Zipcar, RelayRides features a small white digital display and keypad mounted at the top of the windshield, just to the left of the rear-view mirror. It shows you the current time, the miles you've driven, and the start and end times for your reservation. I liked being able to see the "official" RelayRides time, and to be reminded of the time my reservation ended, since RelayRides charges you $50 if you return the car late. (Zipcar has an identical penalty.) Stashed in a slot just behind the display is a credit card that enables you to fill the car up with gas if necessary.

On my return trip, I left Plymouth a bit later than I'd planned, and traffic was worse than I'd expected, so it was quickly clear that I'd need to add an extra half-hour to the reservation. I called the phone number on my membership card and an operator helped me out. Within a few minutes, the updated reservation time showed up on the car's display. The operator mentioned that there is also a way to add time to the rental using the keypad, but that hadn't been readily apparent to me. (I later learned that you can add time yourself only immediately after you turn the car on — and not while you're driving.)

While most Zipcar vehicles have decals all over them that make it clear you're not driving your own vehicle, RelayRides is a bit subtler with its branding. There was a small sticker on the back, and a small one on the front windshield where the RFID sensor is (pictured above).

Cons:

The Matrix had 86,000 miles on it, and once I hit the road, it had a bit of a rattletrap feel. The brakes and suspension were about as loosey-goosey as you'd expect from a seven-year-old car that has done a lot of city driving. The non-functional driver's side window would've been annoying if I'd had to pay any tolls. There was a small banner hanging from the rear-view mirror that I had to remove — I don't like anything that obscures my view for no good reason — and then remember to replace when the rental was done. (I probably forgot to turn the volume on the stereo back down when I checked out of the car, and for that I am sorry.)

Bottom Line:

I've been a Zipcar member for about three years, and while the rental rates are higher than RelayRides, I'll continue using Zipcar for two reasons: convenience and confidence. The cars are closer to where I live (and also convenient to use when I travel to other big cities where Zipcar has a presence), and I'm confident that they'll be well-maintained and relatively new. But if RelayRides starts adding cars closer to me — and especially if they add vehicles that Zipcar doesn't offer — I'll likely start using it more frequently. I called RelayRides founder Shelby Clark after my rental yesterday to check some facts about the service, and he mentioned that a sporty Audi S4 may soon be entering the fleet; they've also occasionally offered access to a Porsche Cayenne. Some minivans or big SUVs would be handy, too, for when you're planning a group outing.

Clark said the service will officially launch on September 1st; the company is also looking for "community organizers" who will help RelayRides expand to towns outside of Cambridge (but within a 50-mile radius of Boston.) RelayRides is still offering $25 in driving credit to new members.

Have you tried RelayRides? Do you rent out your car through the service? Post a comment if you would...

In Providence, nine Betaspring start-ups strut their stuff for investors

Posted by Scott Kirsner August 19, 2010 08:10 PM

betaspring.jpgEntrepreneurs pitched subscription underwear delivery services, medical devices to alleviate the pain of being poked with a needle, and an iPhone app that could bring back the days of Fonzie and the jukebox this afternoon at the annual Betaspring Demo Day in Providence. Betaspring offers fledgling companies twelve weeks of free office space and mentorship, along with a small cash stipend/investment that ranges from $15,000 to $20,000. (Betaspring co-founder Allan Tear described it as “rent and Ramen money” for the summer.) At the end of the program, investors gather to see ten-minute demos from each company.

This summer’s crop of nine companies were looking to raise anywhere from $250,000 to $750,000 to continue building their products and bring on software developers, marketing staff, and business development executives.

betaspringroom.jpgA few quick impressions:

  • Tu.nr was the app I most wanted to start using, right now. The idea is to reimagine the jukebox for the iPhone age. Once you’ve got the tu.nr app, and you’re in a bar or nightclub that’s also using tu.nr to play music in the venue, you can vote for the songs you’d most like to hear from a library of tracks. Songs with the most votes rise up the playlist. Most places where music is played already pay a licensing fee to rights clearinghouses like ASCAP and BMI, so tu.nr wouldn’t also have to license the music itself: they describe the app as essentially a communal remote control for the venue’s sound system. Tu.nr users might even be willing to pay a buck for the right to request their favorite song, or a few bucks to become the venue's DJ for a half-hour.

  • Manpacks has done, by far, the best job marketing itself and getting the business up and running. The company operates a “subscription service for men’s essentials,” in the words of co-founder Ken Johnson. Right now, that means they send a package of undies, socks, and t-shirts out to subscribers on a regular basis. (Twenty percent of customers so far are women buying the service for a husband or boyfriend.) Eventually, the founders plan to also offer items like razors, deodorant, and, yes, condoms. The company has racked up mentions on NPR, in the NY Times and Maxim magazine, and will be featured in a forthcoming issue of Inc. (Best audience heckle of the day: Johnson explained that he and his co-founder had been collaborating on various projects over the past ten years. An audience member asked, “How long have you been wearing underwear?” Another: “How long have you been wearing men’s underwear?”)

    meddevice.jpg

  • Diavibe nearly had the most dramatic demo I’ve seen in a while. The medical device (at right) uses vibration, instead of a topical anesthetic, to numb an area of skin before an injection. Many people, explained co-founder Adam Leonard, are needle-phobic. Another team member came out and stuck the Diavibe device onto his bare bicep, and just when it looked like he was going to actually poke himself with a hypodermic to prove the prototype’s effectiveness…….. nothing.

  • Catapulter has built a nifty little transportation database to help you plan trips that involve ground transportation, not flights. How can you get from the campus of Brown University to Princeton, New Jersey, for instance? Catapulter looks at options including taxis, buses, train, and ferries. Users can adjust parameters like how far they are willing to walk between modes of transit, or whether they’d prefer a slightly more expensive trip to one that requires an extra hour or two of travel time. The company expects to earn referral fees by helping to sell bus and train tickets, but it could also be an appealing acquisition for a bigger company like Kayak, Expedia, or Google.

  • Tracealytics is developing tools for monitoring a Web site’s performance and quickly diagnosing problems. The company’s user interface was designed so elegantly and thoughtfully, with undulating graphs to help pinpoint problems, that it made tackling a bogged-down database look like a breeze.

  • Also demoing were DataBraid, Web-based statistical software for academic researchers; Jobzle, a job board targeted at college students; Periscape, a social network geared to the people who frequent local establishments like coffee shops and bars; and SensibleSelf, developing sensors to track users’ exercise and health-related habits (like popping vitamins.)

    There was a big Boston contingent in the crowd, including Reed Sturtevant and Katie Rae of Project 11 Ventures; Lee Hower from NextView Ventures; Eric Hjerpe from Kepha Partners; and Tom Burgess, founder of Third Screen Media, now working on a new digital marketing start-up called Clovr Media. Also present was Ji Kim, founder of Dijipop, a 2009 Betaspring company that has subsequently attracted about $1 million in funding.

    horan.jpg

    Richard Horan of the Slater Technology Fund with David Hibbitt, founder of ABAQUS.

    tunr.jpg

    The team from Tu.nr: Jamie Brim and Jack Gill.

    briank.jpg

    Brian Krejcarek talks about SensibleSelf after the demos.

    allantear.jpg

    Betaspring co-founder Allan Tear.

    tonti.jpg

    BatchBlue CEO Pamela O'Hara with Annette Tonti, CEO of Mofuse.

    carusobs.jpg

    Joe Caruso of Bantam Group with Tom Burgess of Clovr Media.

    forbes.jpg

    Forbes journo Maureen Farrell toted along her copy editor, Cecilia.

    owenpierce.jpg

    On my way out, Betaspring co-founder Owen Johnson told me that his team hopes to make the once-a-year program a biannual or triannual event, perhaps with a thematic focus for the added editions, such as medical devices. That’d be great news for the New England entrepreneurial scene. That's Johnson pictured above with Jon Pierce, a founder of Betahouse, the Cambridge co-working space.

  • Retail innovation: Stepping inside bGreen's mobile showroom for eco-friendly products

    Posted by Scott Kirsner August 18, 2010 10:02 AM

    bgreen.jpgNow that Boston seems to be undergoing a welcome explosion of food trucks, I wonder whether retail trucks might be next...

    Retail trucks? Basically, boutiques on wheels.

    Part of the first wave is the bGreen Mobile Showroom, the first real-world manifestation of an e-commerce site launched last fall that focuses on — what else? — environmentally-friendly products for your home.

    Founders Barry Greenstein and Lee Schneider brought the showroom to my neighborhood in Cambridge earlier this week to give me a chance to check it out. (See the video visit below.) Its first public appearance is this week at the Boston GreenFest on City Hall Plaza ... but when they parked it in Cambridge and threw open the back doors, a handful of passersby couldn't help but wander in.

    After launching their Web site last October, Greenstein and Schneider had to acknowledge that it was going to be hard to generate traffic, in a cost-effective way, for yet another specialty e-commerce site. That's when they came up with the idea for a mobile showroom, which they thought would stand out.

    There are two kinds of products inside. There's stuff you can purchase on the spot, like toys made of recycled plastic, EcoDiscoveries kitchen cleaner, and Klean Kanteen water bottles. You pay with a credit card (the showroom uses a nifty credit card reader from Square, which plugs into an iPhone.) But bGreen's founders expect that the bigger revenue generator will be home renovation projects using sustainable materials, like bamboo cabinets, cork flooring, and colorful countertops made of recycled glass and concrete. (They're even happy to drive the truck to your house, show you product samples, and refer you to a contractor who can handle the installation.)

    bgreen2.jpg"You might buy a ChicoBag [a compact, reusable shopping bag] for five bucks, but we look at that as a gateway drug," says Schneider (on the right in the pic). "Our interest is really in the home design stuff."

    After the GreenFest, the truck will be at the Sowa Open Market on certain weekends in September and October, "but at the events, the goal is to meet people, and then bring it to their homes to show them product samples in a more leisurely way," says Greenstein. The plan is to communicate the truck's current location on Twitter. On test runs, they've had as many as eleven people in the truck, a FedEx-style box truck that they bought used last year). At that point it starts to get a little crowded, they say. The truck, incidentally, runs on regular unleaded gas; the cost of converting it to burn biodiesel was prohibitive, say bGreen's founders, who spent about $50,000 of start-up capital building their Web site and outfitting the mobile showroom.

    I wondered about parking it. No one bothered us while we sat for a half-hour on a side-street near Porter Square, but Schneider said they haven't yet been able to figure out what permits they might need to park on a city street. "You can get a permit if you want to sell burritos, but no one seems to know what we need to sell beeswax candles," he said.

    Here's a first look inside their mobile showroom.

    Bedding entrepreneur pitches the pluses of customization

    Posted by Scott Kirsner August 12, 2010 08:00 AM

    Last year, Evan Saks was working for a Stoughton mattress company that was in a precarious spot: it was the New England franchisee for Dial-A-Mattress, which had just been through bankruptcy proceedings. As soon as Dial-A-Mattress was purchased by a new owner, the Stoughton company's franchise agreement was revoked, and it went out of business last fall.

    But Saks, who comes from a long line of mattress merchants, had an idea for a new start-up: what if you could design your own mattress online, and have it delivered to your home within two weeks?

    With funding in "the low six figures" from of a group of angel investors, and a collaboration with the Boston Web development shop MaintainNet, Saks launched Create-A-Mattress last Memorial Day weekend.

    Customers can select the size of their mattress; the type of support (like traditional coils or pocket coils, supposedly better at isolating movement); the mattress thickness; an optional "Craftmatic"-type adjustable base; and mattress covers made out of bamboo fibers or organic cotton. There are about 1,000 possible combinations of features. Special feature sets, like the "bad back package," include things like memory foam, quadruple layers of thick latex, and "upgraded zoned coil systems."

    A label on the lower right edge of the mattress can also be customized; one recent shopper had it imprinted with the phrase "Where the magic happens."

    The site claims its prices for its finished mattresses, which start at $370, are at least 20 percent lower than retail.

    Unlike Dial-A-Mattress, which relied on heavy radio advertising to attract customers, Saks has been focusing his marketing efforts on search engine advertising, and a YouTube channel he plans to expand. He's also experimenting with Facebook advertising. (Saks concedes that he did test some radio spots in July, when airtime is especially cheap.)

    "We're trying to attract folks who might have some idea of what they want, and say, look, you can get exactly what you need to fit your budget, but take the confusion and the deception out of the showroom environment, where you get overwhelmed by choices," Saks says. "For most people, it's impossible to tell the difference between the $500 and the $1500 mattress." (And you can just guess which one the typical salesperson would rather sell you.)

    Create-A-Mattress' product is made in the Boston area by a "major brand manufacturer" — in the mattress industry, that means either Sealy, Simmons, Serta, or Stearns & Foster — though Saks says he can't disclose which one.

    Project 11 Ventures: Hoping to rock out with lots of tiny investments

    Posted by Scott Kirsner August 11, 2010 04:20 PM

    reedsturt-katie.jpgThere still isn't much on the Web site to describe what Project 11 Ventures will do, aside from "invest in and assist early stage companies." The fledgling firm's Twitter account has so far had just two messages posted to it.

    But I'm told the firm, founded by ex-Microsofties Reed Sturtevant and Katie Rae, is looking to raise a small first fund of under $5 million, mainly from established and wanna-be individual angel investors, and will make investments in the $10,000 to $50,000 range in Internet-enabled businesses that can prove their business models with a couple hundred grand, not millions.

    Sturtevant spoke with me this morning, discussing how the firm will try to differentiate itself in Boston's seed-stage investing scene. He also mentioned that he and Rae have made a first investment using their own capital (putting $10,000 into a company he wouldn't yet name), and may do a few more small deals this fall as they work to raise the Project 11 Ventures fund.

    Sturtevant and Rae are stressing their "operational expertise" working inside start-ups, incubators, and big companies. "We believe we can do executive coaching, and help people think about rapid product design and their go-to-market strategy," he said. They plan to get to know entrepreneurs — and help the entrepreneurs in whom they've invested — by holding a series of invite-only seminars. One took place yesterday at the Cambridge Innovation Center, walking participants through a half-day of exercises like creating a product road map, and understanding the different constituents (customers, partners, vendors, etc.) who will play a role in a given company's business.

    Rather than listening to PowerPoint pitches in a board room, Sturtevant suggests that "you can find a lot out about how people deal with things by working with them on a real issue."

    As for Project 11's investment focus, Sturtevant says he's interested in themes like "manufacturing as a service, the democratization of creative design, and people having a closer relationship with producers, like you see with Etsy and the local food movement." He also added that ideas that tap into the processing power of smartphones are appealing.

    Rae is especially interested in software-as-a-service and freemium business models, "but I also love things where you really care that they're actually going to make the product — because it might improve healthcare or the way we communicate."

    "All I've really done in my career is stuff that has a social and community aspect to it, and usually some kind of game mechanics," Rae continues, adding, "I really care about businesses actually making money."

    Rae spoke to me from her mobile phone outside the Peet's in Newton Center; I met with Sturtevant earlier today at Crema Café in Harvard Square. "We have a list of the best free places to work," Rae jokes.

    Before Microsoft, Rae and Sturtevant worked together at Eons, the social networking site for baby boomers founded by Jeff Taylor of Monster.com. And previously, Rae worked at Terra Lycos and AltaVista, and Sturtevant was at the Boston office of Idealab and Lotus Development. Both were cut loose from Microsoft in a re-org last fall.

    The pair have been active in all sorts of local start-up activities this year, reviewing business plans and serving as mentors at Angel Boot Camp, TechStars Boston, and MassChallenge. They've been out to Boulder to meet with the TechStars companies there, and plan to be in Providence next week for the Betaspring start-up demo night. Sturtevant says that their primary geographical focus will be start-ups in the Boston area and New York City.

    Rae and Sturtevant will also be teaching a new course at MIT this fall with Sir Tim Berners-Lee, the inventor of the Web.

    Project 11's name, of course, is a reference to the most excellent mockumentary "This Is Spinal Tap," in which guitarist Nigel Tufnel shows off a special amp that goes all the way up to 11. "If we need that extra push over the cliff, you know what we do? 11. Exactly. One louder," Tufnel explains.

    (Photo above by Chris Herot. Used with permission.)

    'Thanks for the referral. Here's your steak.'

    Posted by Scott Kirsner August 9, 2010 12:00 PM

    In August of 2007, Lewis Weinstein launched the beta version of ReferralKey, a site intended to help digitize the process of sending referrals from one professional to another. If a real estate agent sent one of his clients to a mortgage broker, the site would track that ? and also keep tabs on whether the mortgage broker ever returned the favor. Weinstein envisioned building a new kind of social network for small businesses that would provide continual streams of leads to its members, in a way that sites like LinkedIn and Facebook do not.

    But the site didn't immediately take off. Weinstein, a serial entrepreneur and third-generation tax accountant in Needham, found that professionals using the site felt it just wasn't helping them generate enough new business. "The common response was, 'I thought you were gonna send me referrals,'" he says.

    That's where the steaks come in.

    When Weinstein relaunched the site this past April, he decided to create a new system of incentives. Professionals can now offer a cash bounty to spur others in their online network (or anyone who views their profile on ReferralKey) to send them a new prospect. (Some professionals, such lawyers, real estate agents, and accountants, have codes of conduct that prohibit them from taking such a payment.) If the prospect turns into a paying client, the recipient of the lead instructs ReferralKey to cough up the money via PayPal.

    Users of the site can also upload their databases of clients and send out a message encouraging them to refer their friends and relatives to their trusty financial planner, for instance. "The site will track what happens as a result, and offer them an Omaha Steaks gift certificate, one from Callaway Golf, or one from L.L. Bean, for the new business that gets generated," says Weinstein. As an accountant, he says, he would typically send his clients a letter once a year that offered them a $75 gift certificate to Legal Sea Foods for any new business they sent his way, but the program was a pain to administer.

    Weinstein says that ReferralKey attracted about 5000 members during its beta period. Since then, it has grown to just over 32,000 members. Premium memberships, offering an unlimited stream of referrals, cost $19.95 a month. Weinstein raised a first round of about $1 million from individual investors to launch the site, and says he's now hoping to raise a $3 million second round from venture capital firms.

    He still operates his accounting practice, with offices in Boston and Needham, noting, "Accountants work their a--es off three months of the year, but that gives me time to do entrepreneurial stuff the other months." ReferralKey, with four employees, is co-located in the Boston office of his firm, GenerationTax.

    ThredUP, a trading site for kid's clothing, pulling up stakes in Cambridge

    Posted by Scott Kirsner August 5, 2010 01:38 PM

    thredup.jpgJust over a month after it raised $1.4 million from a quartet of venture capital firms, Cambridge-based ThredUP, a site that enables parents to swap clothing their kids no longer wear, is moving to San Francisco. ThredUP co-founder James Reinhart says the company signed a lease on office space this week. Five employees will head west with him, with two remaining in Boston (both working from home.)

    Reinhart says the decision was primarily a personal one. He and his wife had their first child last month, and his wife is originally from the Bay area and has family there. Reinhart spent six years in Santa Cruz, working as a teacher and helping to start a charter school, in between his undergrad studies at Boston College and earning dual Master's degrees from Harvard Business School and the Kennedy School of Government.

    In raising funds for the company earlier this year, Reinhart says "I'd mentioned to Trinity Ventures [based on Sand Hill Road in Menlo Park] that we were thinking about moving [west], and I think they sort of came to expect that it would happen at some point" — especially after Trinity decided to lead the company's funding round in July.

    Two Boston firms, Founder Collective and NextView Ventures, and a New York investor, High Line Venture Partners, also put money into ThredUP in that round.

    Eric Paley of Founder Collective told me this afternoon that "when I met James, before Trinity got involved, he told me that he was probably moving to the Bay area," but that Reinhart was also considering staying in Cambridge. "All things considered, I'd love for him to be here, but look, we invest in companies in Europe and California. I didn't push him in any direction," Paley says, noting that when he was running the MIT spin-out Brontes Technologies, Left Coast investors at times encouraged him to move the Lexington-based company to California. (Paley successfully resisted.)

    "I don't think Boston would've been at all a bad place to do this kind of start-up," Paley says.

    And neither does Reinhart, noting that several Boston-area companies like Swaptree, Gazelle, and RelayRides are encouraging people to swap, re-sell, and share things in new ways.

    But he does note that when looking to hire people who've built and marketed consumer-oriented Web businesses, there's a much deeper talent pool in the Bay area. Reinhart says that Trinity has already started to help ThredUP connect with some prospective new hires.

    ThredUP launched last fall, and shifted its focus from men's and women's clothing to kid's stuff this past April. Members of the site list a box of kid's clothing they'd like to get rid of, and they can select a box of clothes they'd like to receive from the site's inventory. Members pay $13 per trade, and a premium membership with extra features is available for $30 per year. (It costs the company $10.70 to ship each box via USPS Priority Mail.) About a quarter of the site's swappers eventually upgrade to the premium level, Reinhart says, adding that about 1000 members are joining the site each week. There are currently about 1500 boxes listed on the site for trade, he says, and members have shipped 3000 boxes to one another.

    "We believe we're building something for every parent in America," Reinhart says. "This is a fundamental consumer behavior change. We want people to say, 'Oh, my kid has grown out of these clothes. I need to ThredUP.'"

    Reinhart (center, above) met co-founder Oliver Lubin while studying history at Boston College; he met Chris Homer, ThredUP's chief technology officer and third co-founder, while at Harvard Business School.

    ThredUP plans to be in their new Union Square digs in San Francisco by September 1st. In total, the company has raised about $1.7 million in funding.

    (The photo above comes from a Boston Globe feature on the "25 Most Stylish Bostonians of 2009.")

    Big government contractor picks up Mass.-based Reveal Imaging, maker of explosives scanner for airports

    Posted by Scott Kirsner August 2, 2010 01:30 PM

    One of the investors in Bedford-based Reveal Imaging tells me this week's purchase of the company by Science Applications International Corp. is "a very positive acquisition," though the price wasn't disclosed.

    Reveal makes a special automated scanner that airports use to check bags for explosives; in 2004, just two years after its founding, the company won approval from the Transportation Security Administration, which became its biggest customer — spending nearly $80 million in stimulus money to purchase the scanners. The company's compact CT scanners are also used in Israel, Mexico, and China.

    Reveal, with just over 100 employees, was #284 on the Inc. 500 list of fast-growing private companies last year, and I mentioned them in a recent column about IPO prospects. (Guess that won't be happening.) Reveal's 2008 revenue was $47 million, and the company ("nicely profitable," according to the investor with whom I spoke today) could surpass $100 million in 2010 revenues.

    Investors including General Catalyst, Greylock Partners, and Flybridge Capital put just under $25 million into the company.

    I first visited the company in 2003, and mentioned them again in a 2005 column about venture debt.

    Day-after reactions to Rhode Island's play for 38 Studios, Curt Schilling's videogame start-up

    Posted by Scott Kirsner July 27, 2010 10:52 AM

    Talking to people this morning about Rhode Island's apparently-successful play to lure Curt Schilling's game start-up, 38 Studios, with a $75 million loan guarantee, one thing emerges: the littlest state is taking a big risk.

    Jeff Bussgang, a Boston venture capitalist who co-wrote a Harvard Business School case study late last year about 38 Studios, called the loan guarantee "a bold move."

    "It's almost like Chinese-style industrial policy on Rhode Island's part, trying to create a games and digital media cluster this way," Bussgang said. (Rhode Island's legislature recently permitted the state to guarantee up to $125 million of loans... so $75 mil represents a big chunk of that.)

    Of course, Bussgang said, the loan guarantee requires the company to raise money from banks or institutional investors first, perhaps by issuing bonds, with Rhode Island serving as a "backstop" for those investors. In that sense, the state's risk is pretty binary: either it'll have to pony up $75 million if the company fails, or it'll never need to actually cough up that cash. (Here are the details of the deal.)

    Of 38 Studios' ambition to employ 450 people in Rhode Island by the end of 2012, Bussgang said actually doing so would be "extraordinary." (The company today has about 70 employees in its Maynard, Massachusetts office.) It'd mean that 38 Studios would grow into the biggest videogame company New England has seen in recent memory (even Turbine Entertainment and Harmonix Music Systems, two of the most successful existing game companies, have employed 300-350 people in their busiest periods.)

    Bussgang said he doesn't think Massachusetts made a mistake in not trying to match Rhode Island's incentives.

    Even Saul Kaplan, the former head of the Rhode Island Economic Development Corp., seemed surprised by the size of the state's loan guarantee. "I never really contemplated a deal this large," Kaplan said, but instead smaller loan guarantees and investments to get "a portfolio of technology and IT companies based here." Kaplan is now founder and "chief catalyst" of the Business Innovation Factory in Rhode Island.

    In the old days of economic development, when a state got involved in assisting companies, Kaplan observes, there would be some hard assets — like a factory or production equipment — that could be sold off if things went south, helping to repay the loan. "In a knowledge-based industry like gaming," Kaplan says, "when these companies go out, there isn't much in the way of assets to liquidate."

    "Now the real open question is what will the market demand and penetration look like for these two first games" that 38 develops, Kaplan says.

    Interestingly, when I asked Kaplan about a few small Massachusetts tech companies that Rhode Island successfully managed to attract earlier in the decade with incentives, he had trouble recalling their names. Had any of them grown into 100 or 200-person companies? "Probably not," Kaplan admitted.

    Dave Schlafman, a media entrepreneur in Watertown, told me he felt it'd be a challenge to hire a couple hundred videogame programmers and designers in Rhode Island. Many big game developers, like Harmonix, hit that same hiring wall even here in Massachusetts, and they're forced to find freelancers or small contract shops in other states.

    On Twitter this morning, Angus Davis, founder of the Providence start-up Swipely, said that "since all Mass. VCs passed on [the] deal, I guess it's a great idea for RI taxpayer, right? Meanwhile, state cut Slater VC fund. Dumb."

    (The Slater Technology Fund was created by Rhode Island in 1997 to make small investments in early-stage start-ups, and its funding was cut recently.)

    Bill Reed, CEO of Demiurge Studios, a game development shop in Cambridge, posted this open letter to Schilling (and his employees) this morning. In it, Reed wrote, "If anyone on the talented 38 Studios team wants to stay in Massachusetts, where we play major-league ball, they're more than welcome to join the team at Demiurge Studios, the state’s soon-to-be largest independent game studio."

    Game entrepreneur Jon Radoff says, "If they have a successful MMO launch and wind up being one of the top MMO products out there, then I think it's conceivable" that 38 Studios might employ 450 people in Rhode Island within a few years. [MMO refers to a "massively-multiplayer online" game, which is the second product 38 Studios has in development.]

    Like many other states and provinces in Canada, Rhode Island "may be getting more aggressive to court the videogame industry because it is an industry that experiences a lot of growth, and can inject a lot into local economies," Radoff said, adding that the trend is "definitely a threat to Massachusetts."

    Are HubSpot and Constant Contact turning into rivals?

    Posted by Scott Kirsner July 23, 2010 08:19 AM

    About a year ago, Apple issued a press release to announce that Google's CEO, Eric Schmidt, was resigning from Apple's board.

    "...[A]s Google enters more of Apple’s core businesses with Android and now Chrome OS," Steve Jobs said in the release, "Eric’s effectiveness as an Apple Board member will be significantly diminished, since he will have to recuse himself from even larger portions of our meetings due to potential conflicts of interest."

    I have a hunch we could see a similar thing happen locally, with Constant Contact and HubSpot, two companies that help small and mid-sized businesses with digital marketing. Constant Contact, based in Waltham and run by Gail Goodman, is publicly-traded, and best-known for its subscription service that helps companies manage their e-mail newsletters; HubSpot, headquartered in Cambridge and run by Brian Halligan, helps companies use social media (including blogs and Twitter) to build their customer bases. Goodman sits on HubSpot's board.

    HubSpot offers as part of its subscription service an e-mail marketing tool that makes it simple, the company says, to send "a single email to just a few leads or a personalized email offer to your entire database of contacts." In May, Constant Contact bought a small California company specializing in social media, and now offers webinars and an e-book on "35 things you should know about Facebook, Twitter, and other networks."

    When I spoke to Goodman last month, she acknowledged that what was once a clear boundary between the two companies is now a bit fuzzier, but she said she didn't have plans to split from HubSpot's board. Goodman, in fact, was over at HubSpot's Kendall Square offices last week to give employees a talk about leadership.

    Halligan acknowledges that the two companies have been edging closer together over the past year, but says that HubSpot sells to a "slightly bigger company," with a monthly subscription fee in the $500 range, while Constant Contact targets individuals and small business owners who pay an average of about $30 a month.

    As for the question of whether there's a growing conflict with Goodman serving on HubSpot's board, Halligan says "it has definitely come up, but she doesn't seem particularly worried about it, and I'm not. We'll see how it goes down the road."

    Goodman joined the HubSpot board in March 2008.

    A week of winnowing for MassChallenge

    Posted by Scott Kirsner July 13, 2010 04:10 PM

    John Harthorne, CEO of the MassChallenge start-up competition, tells me that this week a group of judges are working to winnow 300 teams of entrepreneurs to 100 finalists; they're hearing some company pitches in person; some via Skype from as far off as California, Spain and Argentina; and Harthorne says a Brazilian team even flew to Boston for some face time. Judges include folks like 170 Systems founder Karl Buttner, Raj Melville of nTag Interactive and BeFree, and Micah Rosenbloom from Brontes/3M.

    The goal of the competition is to encourage start-ups to come to Boston — or stay here and grow. The hundred finalist companies (finalists will be announced later this month) will be offered several months of free office space at the One Marina Park high-rise on Fan Pier; Harthorne is expecting about 200 people to use the space, noting that each team has 2.7 members on average. (Some entrants already have office space elsewhere.) A few lucky winners will receive either $100,000 or $50,000 at the competition's conclusion this fall. The cash prizes will total $1 million, and all of the prize money, Harthorne explains, comes from private sponsors like Microsoft, Xerox, and the law firm Foley Hoag.

    Bill Starr of MyLifeList, who'd been living in Venice, Calif. earlier this year, says the MassChallenge competition — along with a more active early-stage investment community here — persuaded him to move to Swampscott in March. The site, which encourages visitors to list their life goals and then supplies encouragement, was founded in 2008.

    You can view other team pitches on the MassChallenge Web site.

    iPhone app-maker CardStar shops for office space in Boston

    Posted by Scott Kirsner July 1, 2010 01:42 PM

    cardstar.jpgScouting the Boston area for office space this week is CardStar Inc. The start-up makes a popular, free iPhone app (1.5 million downloads so far) that enables you to digitize all of your loyalty cards and then simply show the bar code on your iPhone's screen when you're at the checkout counter. The company has previously operated virtually, with employees in Massachusetts, Connecticut, and Washington, D.C. Bizdev chief Stuart Hilger says there will be three employees in the new Boston office, and CEO Andy Miller will work from it part-time.

    I've tried the app three times now. It didn't work at my local Shaw's grocery or at PetSmart, but on the third try, at a CVS Pharmacy, it finally generated that sought-after beep from the laser scanner. (My hope was to be able to get rid of all those loyalty cards hanging off my keychain or stuffed into my wallet; for now, I'm holding on to them) On Apple's iTunes Store, CardStar currently has a 2.5 star rating, out of a possible five stars.

    Hilger explains that the on-screen barcodes work well with some stores' scanning equipment, and not with others. "It's totally a binary thing," he says. "If it works the first time, you'll keep using it, and if it doesn't, you'll probably never use it again." Shoppers at City Sports tend to have good luck, but not Sears. At places like Staples and K-Mart, you may find one store where the app works, but others where it doesn't due to different scanning gear.

    The company hopes to sell sponsorships in the app (Chase Manhattan Bank ran one recently), license its barcode-rendering technology to others, and also make it convenient to save and redeem coupons using the CardStar app. Hilger explains that CardStar can earn a few pennies for each coupon a user cashes in.

    CardStar raised a first round of funding earlier this year: $1 million, some of it from Cambridge-based LaunchCapital. Hilger says the company may wind up adding a bit to that round, given that some strategic partners have expressed interest in putting more money into CardStar.

    Architexa aims to make it easier for software developers to decipher complex code

    Posted by Scott Kirsner June 29, 2010 10:46 AM

    In 2005, Vineet Sinha was a PhD student in MIT's computer science department, presenting some of his work at a prestigious academic conference in San Diego. The project, Relo, proposed that one way to increase programmers' efficiency was to help them understand vast swaths of already-existing software code more quickly; understanding the code that exists, Sinha explains, requires an enormous investment of time, but if programmers don't do it, their new contributions tend to create problems. Relo created diagrams that showed how various chunks of code were connected to each other — a sort of automatically-generated Rand McNally road atlas of complex software.

    After that 2005 presentation, several people in the audience asked Sinha how they could buy a copy of Relo. It wasn't yet a packaged product that he was prepared to support, but after he earned his doctorate in 2007, Sinha began to focus on turning it into one. The company he started, Architexa, is preparing for its commercial debut this month; already, several hundred non-paying customers have been testing it. Sinha says the company has three full-time employees and several interns. Initially, it supports only the Java programming language, but he hopes to eventually expand into C++, and perhaps Ruby and PHP.

    Sinha acknowledges that Cambridge-based Architexa will compete with some of the tools sold by IBM's Rational Software division, but he says that his start-up is focused on developing a wider range of features that will help programmers explore and understand knotty code bases.

    Sinha says the company plans to price its product somewhere between $150 and $450 annually. He intends to "switch on" payment for the current free trial users of the product this month. Later, he may seek angel funding for the company, which would primarily go to staff salaries and a concerted sales and marketing effort.

    But in advance of that, to help generate buzz, Sinha plans to launch a site that will offer Architexa's roadmaps for popular open source programs.

    Here's a video overview of Architexa, produced by the company:

    1. Form company, 2. Land project, 3. Get Emmy nomination

    Posted by Scott Kirsner June 25, 2010 01:45 PM

    fizzys.pngDave Schlafman and Evan Sussman of the Watertown-based digital animation studio CloudKid are in Los Angeles today to attend an Emmy Awards ceremony. It isn't the big prime-time Emmy Awards, but rather the "37th Annual Daytime Creative Arts and Entertainment Emmy Awards," which honor "the craft behind the many shows that grace the Daytime genre," according to the National Academy of Television Arts & Sciences, which puts on the ceremony.

    CloudKid won a nomination for Fizzy's Lunch Lab, a nifty PBS-funded Web site that uses videos, games, and simple recipes to encourage kids to eat better.

    Schlafman says CloudKid was only formed in May of 2009. Shortly thereafter, the small studio won a $400,000 PBS grant to develop the Lunch Lab site, which went live in November 2009. Schlafman says its attracting 675,000 unique users a month, with new content added each week. PBS just gave CloudKid another grant to produce even more Lunch Lab material. "It could eventually turn into a series on the air," he says.

    But right now, Schlafman says, PBS seems especially interested in developing Web content. "The number of kids watching TV is continuing to drop, compared to those consuming online video content," he says. "So many media companies still look at TV as the golden standard, but we're trying to find the sweet spot between TV and social gaming and interactive games."

    Schlafman's former employer, Watertown-based Soup2Nuts, is also at the Emmy ceremony tonight, hoping for a win in a different category.

    Delivering desktops virtually: A cluster emerges in Boston

    Posted by Scott Kirsner June 21, 2010 08:33 AM

    If you don't work in IT, you may not be up to speed on VDI yet.

    VDI is "virtual desktop infrastructure," and information technology executives have been hearing a lot about it over the past year. It enables them to manage the hundreds or thousands of PCs used by their employees more cost-effectively; rather than running around to each desk to install a new piece of software or an update, the IT crew can deliver the operating system and applications to each user over the network from a central data center. They get more control, and ideally the user can access the same customized desktop set-up whether they are at home, on a netbook, a laptop, or even a smartphone. Whenever she logs in, the same desktop picture is there, with all the applications she uses and the proper security privileges.

    Boston is becoming a hub of VDI activity (also sometimes called "desktop virtualization.") Companies like Desktone in Chelmsford, Viewfinity in Waltham, and Virtual Computer in Westford are all taking different approaches to helping IT organizations lower the cost of managing PC users. Scott Davis, the chief technology officer of VMWare's desktop virtualization business unit, is based in Cambridge. And today, Marlborough-based Unidesk formally launches its VDI product.

    Unidesk has been working on "the ultimate virtual desktop" for more than two years, says founder and CTO Chris Midgley. "Desktop virtualization is really all about people," he says. "You can't give everyone the exact same terminal. They want to make the desktop theirs. But IT wants to be able to treat thousands of desktops like they're one desktop."

    Unidesk has raised $20 million in venture capital funding from Matrix Partners and North Bridge Venture Partners, and the company has 34 employees. Midgley says they're currently hiring in the sales and support departments. Early customers include architecture firms, universities, and the Glasgow Housing Authority in Scotland. Customers pay Unidesk on a per-user basis, starting at about $150 per user.

    It was a coup for Unidesk when Don Bulens joined last June as chief executive; Bulens had previously run New Hampshire-based EqualLogic, acquired by Dell in 2007 for $1.4 billion in cash — Dell's biggest acquisition ever.

    Bulens said he found that he "very much missed being part of a team on a day-to-day basis."

    I asked Midgley about his fund-raising experience with Unidesk; he'd earlier sold LiveVault, an online back-up and recovery service, to Boston-based Iron Mountain. (That company raised about $25 million in venture funding, and was acquired for $50 million.) He said he pitched only two firms, Matrix and North Bridge (Matrix was among LiveVault's backers), and both decided to do the deal after about two weeks of due diligence. As for not making the rounds to talk to more firms, Midgley explains, "You want to keep ideas in this world extraordinarily confidential." Some founders seek to shop around their ideas to get the best possible valuation for their company, he says, "at the cost of too much exposure."

    Local Motors, which developed crowdsourced car in Wareham, drives out to Arizona

    Posted by Scott Kirsner June 17, 2010 09:06 PM

    rallyf.jpgWhen I wrote last November about Local Motors, a Wareham start-up that was crowdsourcing the designs for a new line of cars, founder and CEO Jay Rogers mentioned that the company would likely set up its first production facility in Arizona, lured by government incentives.

    The move happened this spring, I'm told, but it also included the company's headquarters staff and most of the company's handful of employees. (Two people focused on Web site maintenance and finance remain in Massachusetts, but without an office.)

    The company had been located next door to Wareham's Factory Five Racing, one of the country's biggest manufacturers of kit cars, and the co-founder of that company has been a big supporter of Local Motors, financially and otherwise.

    I talked to Rogers this morning, who told me that the relocation had nothing to do with labor costs in Massachusetts, and said that the company eventually hopes to open one of its regional "micro-factories" here.

    In Massachusetts, Rogers said he founder the Governor's office unhelpful. In Arizona, by contrast, "the Governor and the local municipality reached out to us, offered help with permitting, and with the application process for the federal Advanced Technology Vehicles Manufacturing Loan Program." In Arizona, the company was offered sales tax rebates and several hundred grand in cash, Rogers says, to make improvements to Local Motors' 20,000 square foot facility in Chandler, Arizona, just southeast of Phoenix.

    "We had a number of meetings with economic development officials in Massachusetts," Rogers says. "We met with people and met with people, and there was basically no action. It's like there wasn't any seriousness about keeping our business in Massachusetts."

    Update: Kofi Jones, director of communications at the state's Office of Housing and Economic development, writes in an e-mail that "business retention and expansion is a top priority of the Patrick-Murray Administration, and we have had great success with companies like Cisco, IBM, and Liberty Mutual. After meeting with Local Motors and their consultant, the Administration’s economic development team presented the company with an incentive proposal. Although we did not receive any feedback on the proposal, we remain prepared to work with Local Motors on any and all future opportunities."

    Rogers says the company currently employs a dozen people, and plans to eventually employ 50 to 60 in Chandler. Local Motors will begin delivering its first vehicle, the $50,000 Rally Fighter (pictured above, with Rogers), to customers this August, he says.

    Another factor in the company's westward migration is that the Rally Fighter is intended for off-roading. Ariel Ferreira, a Local Motors spokesperson, writes via e-mail that "...we're 100 percent certain we're doing the right thing by building the Micro-Factory and Rally Fighter in the place where it is meant to be driven; the place where majority of customers for this vehicle reside."

    They'll be holding an open house at the new digs in Arizona July 31st. Stop by if you're in the neighborhood...

    A trio of local companies prepare to begin betas

    Posted by Scott Kirsner June 17, 2010 08:00 AM

    I've run into three entrepreneurs this week who are getting ready to begin beta tests of new products.

    - Shelby Clark tells me that his new peer-to-peer car-sharing service RelayRides (I've described it as Zipcar without the fleet) logged the first rental of its summer beta test in Cambridge last night. RelayRides had a demo table at the Web Innovators Group last Monday night, and company employees were out in Central Square this week handing out postcards. The company is both looking for potential drivers as well as car owners willing to assign their car's unused hours to the service, and earn money in return. Clark tells me the vehicles available include a Toyota Prius and, amazingly, a Porsche Cayenne. (Vehicles start at $6 an hour for older models, and the Cayenne rents for $14 an hour.) The company is currently based at the Polaris-run DogPatch Lab space in East Cambridge.

    - Brothers Kyle and Matt Rushton are both still working day jobs, but they're also nudging Blogcastr, a live-blogging tool, toward a closed beta test in the next few weeks. The idea is to make it easy for folks "blogcasting" from live events (publishing repeated updates) to share both text and photos (and eventually, audio and video, too) with readers, who'll be able to add their comments and reactions. The Rushton siblings started work on Blogcastr late last year, and they're hoping to get the service up-and-running before looking for angel funding.

    - Vikram Venkatasubramanian and two other alums of Avaya are working on a neat voice-driven service called TopicPhone. Their idea is that it's still too complicated to navigate phone menus (especially on a mobile) by pressing 1 for sales, 2 for customer service, or 3 for billing. With TopicPhone, the goal is to enable a caller to say, "I need to have my house painted," and then serve up a choice of several painters in the vicinity. They plan to operate TopicPhone as an 800 service that would be free to callers, and initially focus on serving the elderly and visually impaired. Venkatasubramanian tells me his advisory board includes he has been getting some informal advice from Ron Croen, the former CEO and founder of Nuance, and now an entrepreneur-in-residence at Tufts.

    As for the business model, Venkatasubramanian explained in an e-mail:

    The revenue model for TopicPhone is an auction-based, pay-per-call model where businesses bid for the phone calls (which represent a 7-10 times more valuable lead than a web click) that are relevant to topics of interest for their business. We plan a TopicPhone premium [service] at a later date which is subscription-based and stores information about the callers, such as their prescription codes, bank account numbers, etc. so that they are able to do things like check their bank balances or refill their prescriptions by just stating that need.

    (And if you're working on something that's getting close to launch, I'm eager to hear about it; just drop me a line using the comment box at right or by clicking my name.)

    New book explores what happens when Gen Y hits the workplace

    Posted by Scott Kirsner June 9, 2010 10:46 AM

    inno-gen-book.jpgOut later this month from Boston entrepreneur Jennifer Floren is "The Innovation Generation: The Gen Y Way & How New Thinking Can Reclaim the American Dream." Floren is founder and CEO of Experience, a company that links students, colleges, and employers to help students and recent grads find fulfilling internships and jobs.

    The book makes the case that more than ever, employers need to be clever about identifying and hiring the best entry-level talent. "A lot of companies don't do internships or hiring of students, or get their front-line people into the world of education as mentors, and that's a huge missed opportunity," Floren says. If they don't, as the Baby Boomers start to retire en masse, "that's going to put them at a competitive disadvantage," she says.

    The book makes the case that Gen Y brings a new perspective to the office that differs from older employees — especially with regard to communications technologies and social networking. That can create management challenges, Floren admits, but it "can also be applied in your organization to fuel innovation."

    Floren says she started writing the book only last year, booking a few days at a time on her schedule exclusively for writing.

    Floren started Experience when she was 24, just after leaving a consulting job at Bain & Co. Since then, the company has raised about $46 million in venture capital (most of it used for acquisitions, Floren says.) The company achieved profitability in 2006, and today has just over 40 employees.

    Could Power Gig be the Next Rock Band?

    Posted by Scott Kirsner June 8, 2010 02:40 PM

    Buzz is starting to build this week about the new videogame "Power Gig," from Boston's Seven45 Studios. The game isn't out until October, but the company will be demoing it next week at the Electronic Entertainment Expo in Los Angeles.

    What's unique about the music game — aside from the fact that they've licensed some tunes from the likes of Eric Clapton and Dave Matthews — is that rather than playing it with a toy guitar, you use a real, tune-able six-string. It's as easy to use as a typical plastic guitar controller, but as you progress in your ability as a musician (or if you're already one), you can actually crank out real power chords, or simply plug it into an amp and rock out separately from the game.

    Seven45's sister company, First Act, is a musical instrument maker in the Back Bay (and yes, 745 Boylston is the address of both companies.) Jeff Walker of Seven45 tells me the two companies share some executives and other resources, and that Seven45 has been entirely self-funded, without outside capital. (Walker is the VP of marketing for both Seven45 and First Act.) The game developer has about 75 employees, and has been working on "Power Gig" for just over two years, Walker says.

    The guitar and drum peripherals that come with "Power Gig" will work with other music games, according to Seven45. Here's a preview of "Power Gig," which will be available for the Xbox 360 and Sony PlayStation 3, from IGN.

    Interestingly, Billboard writer Antony Bruno says that the rival game "Rock Band," from Cambridge-based Harmonix Music Systems, may also wind up heading in a more educational direction with its forthcoming "Rock Band 3."

    Here's a video from the company explaining how the guitar will work.

    Catching up with Eliot Mack and Lightcraft in L.A.

    Posted by Scott Kirsner June 7, 2010 01:22 PM


    eliotmack.jpg
    In Los Angeles for a conference on Saturday, who should I bump into but ex-Cantabrigian Eliot Mack, an alum of MIT and iRobot who is now running a small start-up in Venice, CA?

    I last wrote about Mack and his company, Lightcraft Technology, just over two years ago, as they were starting to pitch TV and movie producers on their real-time compositing system; essentially, it can instantly meld live images in front of the camera with digital scenery and characters that were created in a computer, and show the results on a screen. What's cool is that as the camera moves — even if you take it off the tripod to hold it on your shoulder — the background perspective adapts flawlessly.

    Founded in Cambridge in 2003, Mack took the company out to California, where the customers are. Since then, Lightcraft's system (the base price is $78,500) has been used regularly on the ABC series "V," and for Tim Burton's recent film version of "Alice in Wonderland." Mack says there's a children's TV series also using the system, but he can't yet drop the name yet. He has also been hiring a few more employees, including a director of sales.

    Xconomy planning to launch Silicon Valley site, ship Roush west

    Posted by Scott Kirsner June 3, 2010 11:00 AM


    Xconomy founder Bob Buderi confirms this morning that the Cambridge-based start-up is planning to launch its fifth local business news site in Silicon Valley. Buderi, formerly the editor of MIT's Technology Review magazine, also says that chief correspondent Wade Roush will return to the Bay Area, where he'd long worked as a reporter and editor for Tech Review, to open the Xconomy bureau there.

    As to rumors I'd heard that Gregory Huang, Xconomy's Seattle editor (and a one-time Bostonian), was moving east to take over Roush's old post, Buderi said, "There's going to be a series of promotions and additions, but we're not ready to announce them yet."

    Xconomy launched a news site in Detroit earlier this spring, and Buderi says there are other cities (in the U.S. and outside it) on his radar screen. "Our goal has been to build not just a national network, but an international network," he says. The company has raised two rounds of funding from investors including CommonAngels and Launch Capital, the most recent round last spring. Xconomy has also been cutting deals with Web sites like the Motley Fool and newspapers like the Globe to syndicate its stories. The company has ten full-time employees, Buderi says.

    Buderi agrees that San Francisco may be the most competitive media market Xconomy has yet entered, with sites like GigaOm, Venture Beat, and TechCrunch assiduously covering company launches, fundings, and acquisitions. "I have tremendous respect for those guys, who have been real pioneers in business-to-business blogs. It's crowded, sure, but we think we'll be clearly differentiated." One way is by covering the life sciences industry more than the entrenched players; another, Buderi says, is by writing longer narrative profiles of companies.

    I ran into Roush last night when he was covering the TechStars Boston demo night, and asked him about the upcoming move. He said he couldn't talk about it on the record yet... and so we had a nice off-the-record chat about the City by the Bay (where I, too, lived for a couple years in the middle of the decade.)

    Tech Stars Boston Investor Night: Pics, Boldface Names, Awards

    Posted by Scott Kirsner June 2, 2010 09:57 PM


    techstars-stairs.jpgThe annual TechStars Boston investor presentations tonight were a hot ticket: I'm told some people were turned away at the door for fear of violating the fire code, and Boston's digerati filled the 10th and 11th floors of Microsoft's New England Research and Development Center.

    TechStars aims to help teams of entrepreneurs build a working product in three months, with as much as $18,000 in seed funding and mentorship from local investors and entrepreneurs.

    All ten companies tonight were building Web-based businesses, ranging from online survey tools to social networking apps to customizable Internet radio stations. Two of the start-ups, Sparkcloud and Marginize, had received some sort of funding even before presenting to the audience tonight (Sparkcloud from Avid Technology founder Bill Warner, who helped bring the TechStars program to Boston in 2009, and Marginize from angel investors Joe Caruso, Jean Hammond, and others.)

    techstars2010-2.jpgDuring the course of the evening, HubSpot co-founder Dharmesh Shah tweeted me to let me know that he'd also decided to invest in Marginize — and the way he chose to let the company's founder know that was by using Marginize, a browser add-on that lets you annotate Web pages and see what comments others have added. "How very meta," wrote Shah. (That's founder Ziad Sultan, a former analyst at Longworth Venture Partners, at right.)

    In the audience were folks like Rob Go and Lee Hower, who are working together on a new early-stage investing firm...NeoCarta Ventures managing director Jarrett Collins...Jim Savage of Longworth Venture Partners... Bijan Sabet of Spark Capital...Betahouse co-founder Jon Pierce, who also organized this week's first-ever Angel Boot Camp...Oneforty founder Laura Fitton, part of the 2009 TechStars Boston class...Secretary of Housing and Economic Development Greg Bialecki...Google Ventures managing partner Rich Miner...Viximo CTO Sean Lindsay...ex-Microsoftie Reed Sturtevant...FastIgnite's Sim Simeonov...North Bridge's Dayna Grayson...Elliot Katzman from Commonwealth Capital Ventures...Steve Kane, Gamesville founder, angel investor, and master of the Twitter koan...Harmonix co-founder Eran Egozy...and Rich Levandov of Avalon Capital Ventures.

    techstars-kraus.jpg

    Katie Rae, formerly of Microsoft, mentioned that she'll be teaching a course with Web inventor Tim Berners-Lee at MIT this fall, along with the aforementioned Sturtevant. And Janet Kraus, founder of Spire and Circles, is joining the faculty of Harvard Business School this fall to teach entrepreneurship. (Rae is at left, Kraus at right.)





    techstars-dale.jpg

    Richard Dale of Sigma Partners, who writes the blog Venture Cyclist, with Izhar Armony of Charles River Ventures.






    techstars-dodge2.jpg

    Google developer relations exec Don Dodge, who maintains the blog "The Next Big Thing," with Gus Weber of Microsoft NERD and John Landry of Lead Dog Ventures.












    techstars-gesh.jpgCommonAngels managing director James Geshwiler, who observed that I am one of his Foursquare friends, before correcting himself: "Or maybe you are just one of my square friends."










    schmelzer.jpg

    I was somewhat alarmed to learn that Ron Schmelzer, an MIT alum and one of the early Internet entrepreneurs in Boston, has (A) moved to Baltimore, where his wife is teaching at Johns Hopkins, and (B) started a baseball cap company called Zoptopz.










    techstars-brod.jpg

    Shawn Broderick oversees the TechStars Boston program. He had a great sticker on his Macbook Air: "Those who say it can't be done shouldn't interrupt the people doing it."

    OK, on to a few random awards for the entrepreneurs who presented, each of whom was impressive in his or her own way... (As with TechStars 2009, there was just one female CEO in the bunch, Francesca Moyse of Monkey Analytics.)

    Most persuasive: Leon Noel of Social Sci, a site that intends to help scientific researchers conduct online surveys efficiently, dangling incentives (a free iPod Touch!) to entice participants. Noel presented first, and by the time he was done, it was easy to imagine every university in America buying a subscription to the service.

    The Jerry Lewis Telethon Award: Marginize founder Ziad Sultan, for casually mentioning that he'd already raised $250,000 for the start-up, and just needed $100,000 more to complete his planned $350,000 seed round. (It worked, at least partially.)

    Best Acronym Deployed: Appswell founder Daniel Sullivan, building a service that will help companies crowdsource ideas from their customers, talked about "HIPPOS." At big companies, HIPPOS make most of the decisions. Appswell wants to put that power in the hands of the customer. What's a HIPPO? The highest-paid person with an opinion. Love it.

    usermojo_182.png

    Best Logo: Usermojo, trying to capture the emotions that users feel when they visit Web sites (like confusion) to help site designers improve the status quo. The colorful logo elegantly captures the concept that this is a product about both design and emotion.

    Best Multimedia Demo: Brandon Casci of Loudcaster, an Internet broadcasting start-up that lets (paying) users launch their own radio stations. Casci showed some fun examples of how beta testers have been using it to create stations like "Infinite Accordion," a station that plays all accordion music, all the time.

    techstars-starstreet.jpg

    Can't Wait to Use It Award: Jeremy Levine of StarStreet Sports, creating a stock market for trading shares of athletes and sports teams. Levine says it'll be legal for players to trade with real money, though for the World Cup soccer tourney, they're still using play dough. Every sports fan I know will invest at least $100, with StarStreet planning to take 2 percent from the sell side of every transaction. (That's Levine at right, pitching his "Big Vision.")

    Appswell founder Sullivan mentioned to me that all of the TechStars Boston start-ups have found office space for the summer in Boston, to "keep the band together," as he put it. Most will wind up at the Cambridge Innovation Center's co-working space (thanks to a sponsorship from Microsoft that will pay the rent); a couple will shack up at Dog Patch Labs Cambridge; and one will share space in Somerville with Viximo. That's good news...and I'll be curious to hear whether some more fundings happen after tonight.


    A little Zipcar history, as company files for initial public offering

    Posted by Scott Kirsner June 1, 2010 01:00 PM


    Cambridge-based Zipcar filed to go public this morning (here's the press release, and the SEC document). The three biggest shareholders are ex-AOL CEO Steve Case's Revolution investment arm, Benchmark Capital in California, and Greylock Partners. Zipcar CEO Scott Griffith holds 3.92 percent of the company, about 2.4 million shares.

    I went back into the archives to pull out the column I wrote in 2003, a few months after Griffith joined Zipcar as its CEO, replacing co-founder Robin Chase; Chase's husband Roy Russell was still serving as Zipcar's VP of technology. (Both have since moved on.)

    My May 26, 2003 @large column, "New chairman, CEO shift gears at Zipcar":


    Zipcar is one of the most promising start-ups in Boston.

    The question: can a new chairman and a new CEO from the world of high-tech steer it in the right direction and step on the gas?

    The Cambridge company, which operates a car-sharing network in Boston, Washington, and New York, was veering off course last year. It was losing money, and didn’t have enough left in the bank to reach profitability. It needed to attract more funding, but the willing investors insisted on replacing the old board of directors and bringing in a new CEO to take over from Zipcar founder Robin Chase.

    Enter Scott Griffith, who joined as CEO in February. Griffith had been CEO of Digital Goods, which made software that prevented e-books from being copied. Jonathan Seelig, a co-founder of Akamai Technologies and one of the early investors in Zipcar, took over as chairman. (Chase remains in a business development role, and still serves on the board.)

    Standing in a parking lot behind the post office in Central Square, Griffith demonstrates how Zipcar works. In his office nearby, we’d used the company’s Web site to reserve a banana-hued Mini Cooper for a few hours. Using this particular car costs Zipcar members $7 an hour, plus forty cents a mile. Gas is included. Making the reservation took about two minutes.

    A few seconds after we made the reservation online, Zipcar’s system beamed a message to the Mini via Verizon’s two-way paging network. The message told a small computer hidden in the car who had reserved it, and for how long.

    FULL ENTRY

    Sports stock market tests its technology with World Cup soccer

    Posted by Scott Kirsner May 24, 2010 07:06 AM


    StarStreet, one of the Cambridge start-ups participating in this spring's TechStars development program, is down in New York this week for the TechCrunch Disrupt conference. They're using the event as an opportunity to open up the beta test of their "sports stock market" to more people, according to founder Jeremy Levine; all you need is a Facebook account.

    The first event in which you'll have a chance to participate is the FIFA World Cup soccer tournament, which starts June 11th. StarStreet players can "buy" shares in teams and individual players using play money — and see how their decisions play out over time. The company eventually hopes to let you trade on StarStreet using real money (and either turning a profit or chalking up a loss), though there are some questions hovering over the legality of that. (I'm sure StarStreet would be much more hazardous to individual investors than, say, the NYSE.) An early test during the NCAA's March Madness tournament had a small number of users trading with actual dollars, and no legal or regulatory actions arose.

    StarStreet will also be part of the TechStars Boston demo night next Wednesday (an invite-only event for prospective investors). The start-up's "coaching staff" (read: advisory board) includes Viximo co-founder Sean Lindsay and Black Duck Software veterans Doug Levin and Palle Pedersen.

    The Friday Five: Innovative Financial Services Start-Ups

    Posted by Scott Kirsner May 21, 2010 12:19 PM


    On Fridays, I regularly post a list of five things worth knowing about, and invite you to add others in the comments.

    This week, it's New England start-ups working on new ideas in the financial services space.

    - Cambridge-based Blueleaf wants to encourage you to collect all your banking and investment info in one place, and then collaborate with friends, family, or financial advisors to improve your returns.

    - Currensee. A social network built especially for foreign exchange traders. It allows participants to discuss strategies and compare performance. Boston-based Currensee has raised $12 million in venture capital so far, from firms like North Bridge and Egan Managed Capital.

    - Taking a page from the ING Direct playbook, PerkStreet is a bank without branches or toaster giveaways. Targets consumers who are happy to bank online, ask questions via e-mail, or call up a live person by phone. By keeping costs low, Boston-based PerkStreet can offer rewards for using your debit card that include free Dunkin' coffee, iTunes downloads, or Amazon.com credit.

    - Swipely encourages users to share information with friends (or the Web at large) about purchases they've made, and to rate or comment on the things they've bought. Launched a beta last month, and announced $7.5 million in funding. Based in Providence, RI.

    - Trefis is building a community of amateur equities analysts, who use the site to share their scenarios for how a particular stock will perform. Nifty visual tools for estimating how good or bad performance in a given line of business will affect the share price.

    (One more company worth a mention is WePay, which offers a solution for group payment situations — like renting a Cape house for the summer with a bunch of friends. Founded here by two Boston College alums, it's now based in Palo Alto, unfortunately.)

    Who would you add to the list? Post a comment...

    Jason Calacanis' Open Angel Forum coming to Cambridge in June

    Posted by Scott Kirsner May 18, 2010 03:20 PM


    Peeved about events that charge entrepreneurs an entry fee to present their businesses to angel investors, Jason Calacanis decided to create Open Angel Forum earlier this year. The series of events, held so far in places like San Francisco, New York, and Los Angeles, is "dedicated to providing entrepreneurs with free and open access to the angel investors that they need," according to the Web site. (Calacanis is the founder of the curated "question-and-answer" site Mahalo and an angel investor himself, in companies like Gowalla and Blippy.)

    At each event, Calacanis and his colleagues round up a roomful of angel investors, and select five local start-ups to present their plans. The first local Open Angel Forum will take place June 18th, at the Polaris-run Dogpatch Labs start-up space in East Cambridge, Calacanis tells me. Info about the Cambridge event isn't yet up on the Open Angel Forum site, but will be soon. For now, entrepreneurs can sign up using this form.

    Update: Angel investor George McQuilken correctly points out that most (all?) organized angel groups in New England invite entrepreneurs to present to them sans cover charge. But that doesn't prevent other groups from organizing events here, as youngStartup Ventures tried to do this past spring, where entrepreneurs pay a fee for access to investors.

    MysteryMeet among a dozen demo-ers at tonight's Mass Innovation Night event

    Posted by Scott Kirsner May 12, 2010 02:00 PM

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    It's an eclectic bunch of start-ups that'll be showing off new products at the Mass Innovation Night event this evening in Waltham, from e-mail management software to Pearl's Premium lawn seed. The event is free, and it starts at 7 PM.

    One of the more interesting concepts is MysteryMeet, a site that aims to help foodies group up to check out a new Boston restaurant once a month. "I thought it'd be a great way to drive traffic to new restaurants," says founder Seth Resler, "and a way for foodies to get something special." He's hoping to hold the first prix fixe dinner in June or July. "It's not a dating site, or a business networking site. It's just for people who really enjoy food."

    "There isn't a business model yet," admits Resner, whose day job is as a marketing manager at Burlington-based Linkage. But eventually, the site could take a fee for helping fill tables at new restaurants. 

    For a start-up that hasn't really launched yet, MysteryMeet isn't doing too shabbily on the social media front: they've got 2000+ Twitter followers.

    KickFour aims to bring friends together online around favorite TV shows

    Posted by Scott Kirsner May 11, 2010 10:56 AM


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    Talking with friends about your favorite TV shows, Ajay Kulkarni argues, has never been tougher. "Aside from sports, no one watches things live," he says. "By the time I've seen the latest '30 Rock,' it might be a week or more old." And Facebook, he says, is too vast and too public to be conducive to small groups of friends sharing the best lines from "Modern Family" or dissecting the plot of "Lost."

    "With your close friends, you don't want to just see what they're watching on their Facebook status updates," Kulkarni says. "You want to hang out with them. And to do that, you need and excuse, and you need a place."

    Kulkarni's new start-up, Cambridge-based KickFour, believes TV is the perfect excuse to connect with friends, and that they're building the ideal place. On KickFour, friends can get credit for having seen particular episodes of a show, post comments about it, and also earn badges indicating that they are a "groupie," a "VIP," a "junkie," or a "superstar." (See the video demo below.) Meanwhile, KickFour will be collecting data (perhaps valuable to networks and marketers) about which TV shows have the most fervent fans; which episodes have been most popular; and how people are viewing shows — on Hulu, via TiVo, on an iPad, etc.

    The company is currently operating a very small private beta, which will be expanded later this month when KickFour participates in the TechCrunch Disrupt conference in New York. (KickFour missed out on an on-stage demo slot, but instead got a free demo table in the conference's "Start-Up Alley," where they'll be showing off the site alongside another Boston start-up, Jason Jacob's RunKeeper.) 

    Kulkarni and KickFour co-founder Andrew Cheung were part of the TechStars Boston program last summer, where they developed an e-mail contact management system for BlackBerry phones called Sensobi. But they decided to put Sensobi on the back burner earlier this year, discouraged by the technical and financial challenges of developing the software for iPhone and Android as well as BlackBerry. Joining Kulkarni and Cheung at KickFour is Yishai Knobel, a veteran of Microsoft's Startup Labs in Cambridge and a former classmate of Kulkarni's from MIT's Sloan School of Management.

    Kulkarni says the KickFour team hasn't raised any money since they began developing the "social TV" site earlier this year: "It's still entirely bootstrapped," he says, adding that they've been using free work space in a former MIT fraternity house on Memorial Drive. "There's a ping pong table and the MIT WiFi network," he says. 

    KickFour's blog is here, and below is a video demo of the site.

    Adeo Ressi's Founder Institute coming to town in July

    Posted by Scott Kirsner May 7, 2010 07:15 AM

    Adeo Ressi tells me he's bringing the Founder Institute, a four-month training program for entrepreneurs, to Boston this summer. It'll kick off July 1st, and would-be participants can apply now.

    Boston is the 10th city that has hosted the Founder Institute program, and it seems like it'll be a good addition to the entrepreneurial scene here. "The theory is that entrepreneurs don't have a lot of support in the world," says Ressi, who started the VC rating site TheFunded.com and earlier was a founder and CEO of several Web development and software companies. "If you want to be a professional athlete, you start off playing on a team in high school, and then you have the minor leagues, and then you go pro, and lots of mentors and coaches help you along the way. But for entrepreneurs, you just go out into the world and blindly pound your head into the wall."

    One evening a week, the Founder Institute program brings together a group of entrepreneurs working on new companies. It exposes them to investors and entrepreneurs who offer advice and guidance from their past experience. It also asks the participants to go through exercises like creating a hiring plan or a product road map. Ressi says that the program is most relevant to entrepreneurs working on ideas in software, Web-based services, digital media, and cleantech. (Life sciences and medical devices...not so much, Ressi says.)

    "My guess," says Ressi, who is based in Palo Alto, "is that we'll graduate between 25 and 30 companies in Boston during this first semester." (At least one Boston entrepreneur, Bill Shander of Beehive Media, has already participated in a Founder Institute "semester" held in San Francisco.)

    Entrepreneurs pay a $600 fee to participate in the Founder Institute (they pay an additional $4500 if they receive at least $50,000 in funding at some point down the road). But they also agree to carve out 3.5 percent of their company's equity, in the form of stock warrants, to create what Ressi calls the "bonus pool." The Institute gets 15 percent of the pool, mentors who donate their time get 30 percent, the individuals who run the local program receive 25 percent, and the founders who participate get 30 percent. "Essentially, it means that if you graduate, you own a piece of everyone else's company," Ressi says. "It incentivizes the founders to root for one another, and it incentivizes the mentors to really help this next generation of companies."

    Ressi says that among the folks who've signed on so far to serve as mentors in Boston are Pano Anthos of Hangout Industries; Mike Baker of DataXu; Doug Brenhouse of Metacarta; and Phil Libin of Evernote.

    Running Boston's first Founder Institute program this summer is Ariel Assaf, founder of Wishclipper, a Web start-up that lets users create wish lists of products they'd like to buy or receive as a gift.

    Twenty candles for MIT's $100K Entrepreneurship Competition

    Posted by Scott Kirsner May 6, 2010 01:57 PM


    I'm expecting MIT's Kresge Auditorium to be jammed next Wednesday night, when the 20th edition of MIT's annual business plan competition, known as the $100K (originally it was just the $10K), holds its finale. Several teams will have the chance to present short "elevator pitches" about their ideas, and one team will get a $100,000 check to help launch their company. 

    Not every winner of the competition has gone on to raging success, but there have been some notable finalists and grand prize winners over the years, including Harmonix Music Systems (a 1995 finalist that later created the videogames "Guitar Hero" and "Rock Band"); Akamai Technologies (a 1998 finalist that IPOed the following year); and Brontes Technologies (a 2003 finalist acquired by 3M three years later for nearly $100 million). Brian Cantwell, an MBA candidate at Sloan who is managing director of this year's competition, tells me that one of the best financial returns for a start-up spawned by the program was when Silicon Spice, a telecom chipmaker that participated in 1995, was acquired in 2000 for $1.2 billion (in Broadcom stock, I should add.) Organizers say the $100K has spawned about 120 companies, which at some point have employed over 2,500 people.

    Last year's winner was Ksplice, now a ten-employee Cambridge start-up that enables system administrators  to update the software on a Linux computer without having to reboot it afterward. Last month, the company was named to VC Journal's list of the twenty most-promising start-up companies in the U.S., and last summer it won a $100,000 Small Business Innovation Research grant from the National Science Foundation. (The company hasn't yet taken in any venture capital funding.)

    Here's the quite entertaining two-minute pitch Ksplice gave at the $100K finals last spring:



    And here's a video retrospective of two decades of the competition.


    The finale event is Wednesday, May 12th... it's free to attend... and it runs from 7 PM to 9:30.

    Have you heard the Audio Spotlight?

    Posted by Scott Kirsner May 6, 2010 07:48 AM

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    While still a student, Joseph Pompei became obsessed with the idea of focused audio: what if you could aim sound at an individual listener the same way you might aim a spotlight at a performer standing center stage? What if you could narrowcast music or speech to a single person, rather than using a speaker to broadcast it to an entire room?

    Pompei had been working during his summers as an engineer at Framingham-based Bose Corp. (At age 16, he says he was the youngest engineer Bose had ever hired.) But he says no one at Bose — including founder Amar Bose — thought much would come of Pompei's interest in using ultrasound to "beam" audio through the air. So at 21, Pompei decided to go to MIT to develop the technology at the Media Lab (and earn a PhD.) A decade ago, with $2000 saved from his grad student stipend, he incorporated Holosonic Research Labs, Inc. 

    I hadn't seen Pompei for six or seven years, so I was eager to hear how he was doing when I ran into him at an event this week at the MIT Faculty Club. His demo, in which he aims one of Holosonics' "Audio Spotlights" at members of the audience to let them hear music that no one else can hear, always sparks smiles. The Spotlights work by generating small wavelength ultrasound that transforms into audible sound as it travels through the air toward a listener in a focused beam. (You can see a fun demo video below, produced by the Science Channel.)

    Pompei said he never took money from outside investors, and hasn't regretted that. "We got customer pre-payments for our first few models," he said, most of which were sold to Media Lab sponsors who were "dying to get their hands on the technology." (At one point, he says Bose sent some executives over to look at the technology and see whether they might be able to purchase it or recruit Pompei back to the company, but Pompei says he wasn't interested. A Bose spokesperson didn't return my call seeking a response.) Today, the company has 12 employees at its Watertown HQ, and works with a Hudson company that builds the circuit boards. The devices range in price from $500 to $2000, depending on purchase volume.

    Who's buying Audio Spotlights? Initially, it was places like museums and theme parks. But now, Pompei says the growth is in "advertising, retail, and digital signage. You see these LCD screens popping up everywhere, but they mostly don't use sound because of the complaints they'd get if they had speakers turned up high." Two big recent customers include 7-11, which uses Holosonic gear in conjunction with advertising screens in several hundred stores, and T-Mobile, which in Europe uses the company's equipment to focus the sound that comes out of kiosks that sell ringtones, avoiding cacophony.

    Eventually, Pompei says he could see the technology being incorporated in consumer television sets. What if you could direct the sound from your bedroom TV so only you heard it, while your partner could sleep? Pompei already uses an Audio Spotlight that way in his house. "We get to share a physical space, but not an acoustical space," he says.

    I like the way Pompei positions his business: "We're not in the sound business. We're in the quiet business," he likes to say. "The benefits are seen by people who don't want to hear something."

    But the entrepreneurial challenge, he says, has been "building an industry and building a market" in a world where everyone knows that speakers exist, but not everyone has yet heard about his Audio Spotlight.


    What do Boulder and Boca have in common?

    Posted by Scott Kirsner May 4, 2010 09:15 AM

    According to a new list compiled by ZoomProspector and published in BusinessWeek, Boulder, Colorado and Boca Raton, Florida are the two best U.S. locations for start-up companies. ZoomProspector based its analysis on the number of start-ups, workforce quality, venture capital, and higher education. (Already, you are saying: Boca? Of course: it's home to Florida Atlantic University, where the most popular major is lifeguarding.)

    Cambridge does show up on the list, at #6, behind cities like Santa Monica, Calif., Bend, Ore., and Irvine, Calif. Right behind us is Bellevue, Wash., the town right next door to Microsoft's headquarters.

    Here's the ZoomProspector profile page for Cambridge.

    One variable they don't take into account, which I suspect would help cities on the list like San Francisco, Bellevue, and Cambridge: number of regular networking gatherings, educational events, and support systems for entrepreneurs.

    New program mixes mentors, investors, and entrepreneurs to spawn a dozen new ventures

    Posted by Scott Kirsner April 30, 2010 08:00 AM

    At a private dinner at the Liberty Hotel last January, a group of local executives and investors convened to consider a new approach to assembling start-up ventures in Massachusetts. The evening's speaker was Jonathan Kraft of the New England Patriots; a Waltham advertising company in which he'd invested, Quattro Wireless, had just been acquired by Apple for $275 million. Governor Patrick stopped by to make a few comments about the role that entrepreneurship plays in the Commonwealth's economy.

    The dinner was a hush-hush kick-off event for a new initiative called "12 x 12," which intends to create connections between a dozen venture capitalists, a dozen established CEOs who will serve as mentors, and a dozen younger entrepreneurs, with the goal of creating and funding a dozen new companies with big potential. The program's slogan is "Multiplying Entrepreneurship in Massachusetts."

    Pushing the new initiative are venture capitalist Michael Greeley of Flybridge Capital Partners and Andy Ory, chief executive of Acme Packet Inc., a publicly-traded Burlington telecommunications company. 

    What's most unique about the idea is its focus on enabling already successful CEOs to develop ideas in collaboration with entrepreneurs — without requiring them to abandon their day jobs. Among the CEOs who've committed to being involved in the program are iRobot CEO Colin Angle, Netezza CEO Jim Baum, EnerNOC CEO Tim Healy, and Communispace CEO Diane Hessan.

    "Most VCs would give seed funding to almost anything that Andy Ory or Colin Angle comes up with, because of who they are," says Greeley. "In our shop, we'd say they are 'blank check' guys. So the question we wanted to ask was, 'How do you get Andy's next great idea started today?'" 

    Greeley suggests that in many cases, 12 X 12 companies will take shape around the germ of a CEO's idea. (The potential for distraction was apparently too much for some CEOs — or their boards; Akamai CEO Paul Sagan is participating in 12 X 12 as an advisor, but won't be launching any companies of his own.) In other cases, Greeley says, the program will help introduce entrepreneurs with an idea in a given sector with CEOs who have been thinking about that same space.

    The dozen CEOs in the program will serve as mentors, board members, and potentially investors in the companies that get formed. "We look at this as a way to increase the velocity of these new enterprises," says Ory. "It's incredibly valuable for a first-time founder to have someone on their board who has been there and done that before."

    The first company funded through the initiative is Cambridge-based Lighter Living Inc., a Web site that offers information about healthy lifestyles and also sells products like organic body wash and probiotic snack bars, all under the Lighter Living brand. Founder Marjolein Brugman helped popularize the pilates exercise regimen, and was a frequent guest on QVC selling pilates-related gear and DVDs. As part of the 12 X 12 program, she's working with Shoebuy.com CEO Scott Savitz, who Brugman says has been helped her understand how to create a "hassle-free  shopping experience online. Our intention is to reach millions of women through the Internet, which I've never done before." Greeley's firm, Flybridge, invested $3 million in Lighter Living late last year; Greeley says the deal was a kind of beta test for the 12 X 12 program, which took a bit longer to assemble than he'd originally hoped.

    12 X 12 was spawned as a result of the Tech Hub Collaborative, a group brought together by Governor Patrick in 2009 to improve the competitiveness of the state's tech sector. But Ory says, "There's no political agenda to this. Starting companies and hiring people is a good thing for everyone involved."

    Coach Wei's new start-up, Yottaa, brings in $4 million from General Catalyst and Stata Ventures

    Posted by Scott Kirsner April 22, 2010 06:03 PM

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    There's a party tonight at The Red House in Harvard Square to celebrate the close of a $4 million first round of funding for Yottaa, a Cambridge-based start-up founded by Coach Wei. The cloud computing company raised some money last October from Stata Venture Partners, and General Catalyst joined in to fill out the Series A round this week.

    The company will focus, according to GC partner Larry Bohn, on small- to medium-sized businesses, offering free and subscription-based services like Web site security analysis, performance measurement, and content distribution, in competition with players like Symantec, Gomez, and Akamai. "It's an elastic way for companies to acquire not just infrastructure that they don't need to own, but geographically-disparate infrastructure," Bohn says. (The company is currently hiring a director of operations to help Yottaa build out that infrastructure.)

    Wei tells me that the company's first service will roll out in a few weeks, helping companies diagnose problems with their Web site performance — for instance, is the site bogging down because of a server issue, or some poorly-written JavaScript code? Yottaa's blog refers to Yottaa as "the performance analytics company." Wei says they haven't yet determined all the other services they'll offer, or exactly how the business model will work. 

    Wei tells me the company has a dozen employees; half are based in Cambridge, and the other half in Beijing. 

    "Coach is a terrific technical entrepreneur — really very thoughtful," says Bohn, who'll join the Yottaa board. "I liked his thinking about how the cloud was going to change, and how he could help people who build and run Web sites." Bohn says he was introduced to Wei by Roman Stanek, founder of GoodData, another of his portfolio companies. 

    Wei remains chairman of his prior start-up, Burlington-based Nexaweb, which helps large companies get their legacy applications working on the Web. The chief technology officer at Yottaa, Bob Buffone, also worked with Wei at Nexaweb, as chief architect.

    (A yotta is a unit prefix which echoes the numerical name of a certain search engine.)

    Outing Boston's top angel investors

    Posted by Scott Kirsner April 14, 2010 10:04 AM


    Just yesterday, an entrepreneurially-minded Olin College student was asking me how you can identify angel investors who might be likely to put some early money into a start-up. Unlike venture capitalists, angels don't usually have Web sites, not all of them belong to organized groups like Hub Angels or Golden Seeds, and not all of them like to go to conferences or sit on panels. My answer to the question of how you connect with them has always been, ask other entrepreneurs about the angels they know and have worked with.

    So I'm glad Betahouse founder Jon Pierce is making it his mission to "out" some of Boston's more active angel investors. Earlier this month, he set up a (fairly unscientific) survey asking entrepreneurs and other in the local tech community to share the names of the region's "best" angel investors. 

    On his blog, Pierce writes:

    With abundant seed capital, entrepreneurs are free to test ideas. Many will fail miserably, to be sure, but a few will succeed gloriously, and with that success will spawn dozens or hundreds more entrepreneurs and angel investors.

    He came up with lots of names that are familiar to me. The top ten?

    Dharmesh Shah, Co-Founder, HubSpot
    Andy Payne, Co-Founder, FanSnap
    David Cancel, CEO, Performable
    Brian Shin, CEO, Visible Measures
    - Joe Caruso, Founder, Bantam Group
    Lee Hower, Principal, Point Judith Capital
    - John Landry, Founder, Lead Dog Ventures
    Bill Warner, Founder, Warner Research
    Jean Hammond, Founder, JPH Associates
    Rich Miner, Managing Partner, Google Ventures


    I wasn't aware that folks like Hower and Miner made angel investments, in addition to their work in the VC world. But Hower, a veteran of PayPal and LinkedIn, told me this morning that "when there are things that sit outside of what we do at Point Judith, I'll occasionally make a seed stage investment as an individual," mentioning Oneforty as a recent example. Miner said basically the same thing: if a deal he likes has been pitched to Google Ventures but the group has decided to pass for some reason, he's allowed to make an angel investment if he likes.

    Miner also said that while he doesn't tout his angel activity, "I'm willing to be outed if it helps. It's one of our problems here [in New England.] Having angels lurking in the shadows isn't a way to be best-in-class. You have the sense that people make their money, retire to Nantucket, and sponsor Shakespeare plays in the summer. It's just not as visible as it should be."

    The angel list is linked to an event Pierce is organizing on June 1st called Angel Boot Camp, which aims to introduce more people, ah, of means, to the possibility of becoming an angel investor.

    (Pierce has also created this Twitter list, Boston Angels, that will enable you to follow nearly all the angels on the list via Twitter.)

    RelayRides: Like Zipcar without the car fleet

    Posted by Scott Kirsner April 12, 2010 10:07 AM

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    When you first heard about how Zipcar worked, didn't it sound a bit strange? You're supposed to go online to reserve a car before you want to drive it? How do you ensure that people return the car when they say they're going to? What about keeping it full of gas, and keeping the inside from looking like a rental car at the end of spring break? How could car-sharing possibly work in America, which has celebrated car ownership for more than a century?

    These days, Cambridge-based Zipcar has 350,000 members and a fleet of 6,000 vehicles in the U.S. and London, and the company could go public as soon as this year. 

    And there's a new car-sharing start-up in town that sounds, well, a bit improbable: RelayRides.

    RelayRides is similar to Zipcar, except the company doesn't actually plan to purchase any cars. They're going to use your wheels. 

    shelby.jpg
    The idea comes from Shelby Clark, a former management consultant and Kiva.org executive now finishing up a degree at Harvard Business School. Clark says he went to HBS "with the goal of starting something with a social mission and social impact" — in the case of RelayRides, increasing the utilization of cars that are already owned, and potentially preventing some number of new cars from being purchased. 

    Clark is a Zipcar member, and says that when he lived in San Francisco, the service enabled him to avoid buying his own new car. "I think there's a real trend of people rejecting ownership in favor of access," Clark says. "You look at things like Netflix, RentTheRunway, Zipcar, or various textbook rental programs. You get the benefits of ownership without the hassle and cost."

    Clark says that as a Zipcar member, he has occasionally run into car availability issues, and been forced to reserve a car several miles away. So he started thinking about how a car-sharing service might be able to station more cars in more neighborhoods around a city, without having to ensure that they were being used often enough. The answer: don't own the cars. 

    RelayRides will enable car owners to rent out their own cars to others, and earn anywhere from a few hundred bucks to $8,000 a year, Clark says, depending on how popular their vehicles are, and how centrally-located.
    FULL ENTRY

    What if you could send a non-virtual cupcake to your Facebook friends?

    Posted by Scott Kirsner April 8, 2010 12:20 PM

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    Launched last week by former Googler (and current Harvard Business School student) Subha Townsend is the new gifting service DashGift. Rather than allowing you to send virtual gifts to your Facebook friends on special occasions — really just nifty little icons that show up on your Facebook profile — DashGift aims to make it simple to send along real goodies like a free movie ticket ($10) or a cupcake from Sweet ($3.25), the Boston bakeshop.

    "The whole notion of virtual gifts is an interesting phenomenon," says Townsend, who built the service with her husband Rick, who is also a Harvard grad student. "But I started thinking that rather than just sending along a graphic, if I was actually with my friend in California when I found out she'd gotten engaged, I'd want to take her out for a drink or for dessert. Yes, you can send them flowers or a gift in the mail, but in this time and age, so many of your relationships are digital — no one has everyone's address. Sending flowers would mean calling them, asking for the address, and ruining the element of surprise."

    There are other gift-related apps on Facebook that let you input the recipient's address and send something real in the mail, Townsend acknowledges, "but this is an innovative model, because the recipient gets a code, and they can go to the store or the Web site to redeem the gift. And everyone on Facebook can see that I sent you a cupcake." The message that accompanies the gift can either be made private or public.

    For now, the gifting options are limited. If the recipient is in Boston, you can buy them a cupcake from Sweet or a cake from Finale; eventually, you'll be able to buy them a beer from Tommy Doyle's Irish Pub. If the recipient lives somewhere else, you can make a $10 donation in their name through GlobalGiving, or buy them a $10 movie ticket they can redeem through Fandango.

    Townsend says the idea price point for this kind of "micro-gift" is between $3 and $10. "After $10, there's a huge drop in people's willingness to pay." 

    Townsend is just wrapping up her first year at HBS, and she plans to spend part of the summer working at the management consulting firm McKinsey & Company. But she adds that her husband and other team members "will be working full-time over the summer on DashGift."

    Townsend says they're not really out trying to raise funding at present. To build awareness, they've been doing some advertising on Facebook, primarily to students in the Boston area. They're also hoping that by expanding the number of retailers who participate in the service, they'll be able to get some signage or promotion in their stores and restaurants.

    What do you think?

    (Another Cambridge start-up in the non-virtual gifting space is KangoGift, which lets you send real gifts from local shops using your mobile phone.)

    Polaris to triple size of Dogpatch Labs in Cambridge

    Posted by Scott Kirsner April 5, 2010 10:53 AM

     

    I've been hearing for a few weeks now about an expansion-in-the-offing for Dogpatch Labs Cambridge, a start-up gestation space in East Cambridge run by Polaris Venture Partners. But Polaris' Dave Barrett was only willing to confirm the news this morning — and the expansion is bigger than I'd expected.

     

    The current Dogpatch space, available rent-free to a handful of chosen start-up teams for stays of about six months, fits about twenty desks (and is roughly 2100 square feet.) The expanded Dogpatch, at more than 7000 square feet, will have room for closer to fifty desks. Plus, there will be "hangout" space for entrepreneurs and techies who haven't yet secured a permanent spot at Dogpatch. The new space, on the fourth floor of the American Twine Building, will be online in early May.

     

    "We're trying to really foster a community that's not just a Dogpatch community," Barrett says. The new space will also enable Dogpatch to hold larger workshops and meet-ups, he says. There's "quite a bit of demand" for desks at Dogpatch Cambridge, Barrett says, and the expansion will bring Cambridge up to about the same size as the two other Dogpatch Labs, in New York and San Francisco.

     

    The other big news this week is that Dogpatch has its first "sponsoring partner" in Microsoft, which will hold some events at all three Dogpatch sites, and also introduce (subtly, I'm sure) Dogpatch denizens to various Microsoft tools and technologies. (Barrett sits on a board of venture capitalists who provide advice to senior Microsoft executives.) Barrett says he expects to announce a couple other sponsoring partners this year, who will help Polaris cover the operating expenses of the three labs.

     

    Barrett says the Cambridge space currently houses eleven start-up teams; two ventures have so far raised outside funding — though Polaris itself has yet to fund a start-up at DPL Cambridge. (Polaris has supplied seed funding to five start-ups at the other DPL locations, however.) Barrett says there are a few companies that have team members working in more than one of the DPL locations, such as Assured Labor (Cambridge & New York) and kWhOURs (Cambridge and San Francisco.)

     

    Residents of Dogpatch don't formally promise Polaris a right-of-first-refusal to invest in their companies. Barrett says his measure of whether DPL is a success is whether entrepreneurs get financial backing "by anyone — not just Polaris — that allows these seed projects to get to the next step." Polaris' only commitment to residents is the free office space.

     

    Barrett says DPL Cambridge has already been home to a wide range of start-ups, in areas like energy, life sciences, social media, and software-as-a-service. He and Polaris principal Jonathan Lim hold office hours there every Thursday afternoon (2 to 5 PM — sign up on the Dogpatch blog or just show up), and other Polaris partners like Bob Metcalfe, Kevin Bitterman, and Amir Nashat are occasional visitors.

     

    How do you gain entrance to Dogpatch as a start-up? "The route that seems to be really compelling," Barrett says, "is when current Dogpatchers recommend folks, or if you know people at TechStars or DartBoston or some of the other entrepreneurial communities in town." The preference is "not just for cool people with cool ideas, but people who want to share — who want to mentor and be mentored. Chemistry is a big factor, too," says Barrett.

     

    For the first time tonight, DPL Cambridge is holding an invite-only "demo night" for investors, who will get a chance to see what the Dogpatchers have been working on. (Two of the presenting companies aren't based at Dogpatch.) Lim, who helps run DPL Cambridge, says demo nights will take place a couple times a year.

     

    DPL Cambridge originally opened last September.


    Localytics founder Raj Aggarwal has been a resident since then; his mobile analytics company is one of the two Dogpatch start-ups that has raised outside funding.  "It's nice to be in a space where you've got some cool companies, and can bounce ideas off them," he says, "and you also have access to the Polaris guys, who have been helpful in terms of introductions." Localytics, with five employees now, is just about to hit the six-month mark at DPL Cambridge and is in the market for new space.

    Help wanted: Boston needs more 'alpha users'

    Posted by Scott Kirsner March 30, 2010 01:09 PM

    Here's how I define an alpha user: someone who tries out new Web sites, mobile apps, and digital services, and then helps spread the word. 

    Think of the person who first told you about Twitter, Foursquare, Evernote, or Vlingo. Alpha users are the folks who let you know what's worth checking out. They nudge you toward the new, via their blogs or Twitter streams, or when you bump into them in person.

    And alpha users are crucial to Internet and mobile start-ups that are trying to build momentum: they serve as an unpaid PR minions, or what Seth Godin calls "sneezers," spreading the word through their networks. Some have thousands of followers on Twitter, or tens of thousands of blog readers. That can be incredibly powerful.

    Silicon Valley is full of alpha users: people like Dave McClure and Robert Scoble. Sometimes, they may not explicitly be writing up their impressions of a new site or service — they may simply start using it, or add it to their blog as a new feature (McClure's blog, for instance, is laden with all sorts of widgets from online services like Plancast, Slideshare, and Dopplr.)

    Boston would benefit from an alpha user population explosion.

    That's painfully obvious to me when I talk to Internet start-ups just coming out of the gate, and trying to get their first couple thousand users. "We're focusing on getting influencers and evangelists to start using our service," Sparkcloud's Nick Tommarello told me last week. He has a team member trying to develop a list of such folks locally, since Sparkcloud is focused on building critical mass in Boston first. Kabir Hemrajani of RiotVine told me it gave his site a boost when Scoble tweeted about it during South by Southwest, and also when Boston entrepreneur Laura Fitton used it to list all the parties she planned to attend at the Austin shindig.

    I think just about anyone can evolve into an alpha user; rather than just blogging or tweeting about your own business (or social life), all it requires is checking out a new site or app every once in a while, and either sharing your reactions with your readers/followers, or simply integrating it into your blog/Web site for a while. Sometimes, alpha users may also be investors in the companies they're touting, and that's not a bad thing — so long as they disclose the connection. (Many Boston investors I've spoken to recently about this topic fear the appearance that they're pimping their portfolio companies, but I think the new model of investor is someone like Fred Wilson of Union Square Ventures or Bijan Sabet of Spark Capital: they're both alpha users and investors, and entrepreneurs love 'em for it.)

    Here's my list of ten influential alpha users in the Boston area. (I'd like very much to see it grow.)

    FULL ENTRY

    Vidgame couple build new venture around 'social gaming' trend

    Posted by Scott Kirsner March 26, 2010 10:00 AM

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    If you're a Facebook user, you've no doubt been invited to take part in Vampires or Mafia Wars, two free online games that invite you to start a clan of vampires (or a mafia family) with your friends, complete challenges to earn points, and establish dominance over other groups. Both are examples of "social gaming" — games that spread through social networking sites, are relatively inexpensive to build, and generate revenue by selling virtual goods or currency to players, for real money.

    Disruptor Beam, the latest start-up from husband-and-wife entrepreneurs Jon Radoff and Angela Bull, plans to play in the social gaming arena. Radoff mentioned the new venture on his blog last Friday; we met earlier this week to talk in more detail.

    "We think there are three important elements to a role-playing game: story, character-building, and progression," Radoff says. "A lot of the existing social games have the idea of progression, of advancing through a world, but they don't have the other two." Radoff likes to say he and Bull have been building social games since the early 1990s, when they launched a text-based fantasy game called "Legends of Future Past" on the CompuServe online service.

    GamerDNA was the most recent company that Bull and Radoff started together; it was an online gathering place for die-hard gamers. The company raised more than $5 million in venture capital from Flybridge Capital Partners in Boston. Last year, after cutting its staff in half, GamerDNA was acquired by a New York-based gaming site for an undisclosed sum.

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    What was the lesson there? "GamerDNA built a lot of great stuff for a year or so before thinking about revenue," Radoff says. "Thinking about revenue first could have made a difference." (Bull left GamerDNA in early 2009 to start work on Disruptor Beam. That's Radoff and Bull at the center of the photo, taken at a GamerDNA office-warming party.)

    This time around, Radoff and Bull aren't raising venture capital (at least initially). Their plan is to work with content partners who will help fund the development of social games and also share in the revenues. Disruptor Beam's business model will mimic that of the two leaders in social gaming, Zynga and Playdom: selling virtual goods and currency that give you status, skills, or help you advance in the game. 

    Radoff says the company is working on three games simultaneously — two with partners, and one on its own. The nice thing about social games, he says, is that they can be inexpensive to develop (costing $100,000 and up), "which lets you experiment, building games for different audiences, with different game play mechanics."

    The first game to launch, perhaps as early as May, will be "Gods of Rock," which Disruptor Beam is developing independently. Your role is that of an aspiring rock star who needs to write songs, obtain instruments, and generate income. "Eventually, you can become a music mogul, sign up your friends' bands, and help produce them," Radoff says. (No drugs or booze in "Gods of Rock," though Radoff notes "there will be energy drinks.") The start-up is working on a second, history-based game in collaboration with Powderhouse Productions, the biggest producer of non-fiction TV programming in New England.
    FULL ENTRY

    Trying to improve your work life, relationships, or attitude? Yana wants to help

    Posted by Scott Kirsner March 25, 2010 11:00 AM

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    Existing social networks don't necessarily lead you to a happier life; more likely, they make you jealous about your college roommate's three-week vacation to the South Pacific, or upset about your would-be boyfriend's decision to keep his relationship status set to "single."

    But a new Boston-based site called Yana is designed to promote setting goals that lead to contentedness and good health. (The name stands for "you are not alone.") Users can lay out goals like "stop procrastinating," "save money," or "live in gratitude," and communicate with others who share those objectives. The site also makes it easy to recommend books (like "The Happiness Project") or share tips ("find an exercise buddy.") 

    Co-founder Rebecca Xiong observes that "people spend a lot of money on self improvement — $11 billion in DVDs, books, and counseling sessions — but most of that is happening off-line now. We're trying to build a community, and help move some of the spending online." (Xiong counted the self-improvement books on her own shelf: 32.) She says the Yana site that's live now is "still a prototype." A more official launch will happen this summer.

    Xiong had been a founder of the nightlife listing site Going.com, which was bought by AOL last year. She left AOL on January 1st to start focusing on Yana full-time. (Last month, I wrote about former Going.com CEO Evan Schumacher's new start-up.) Her co-founder, Jason Toy, is based in San Francisco.

    The company doesn't yet have offices, and Xiong hasn't raised outside funding. "It's too early for VC," she says, "and doing consumer Web stuff these days doesn't require a lot of capital." 

    That's one more good tip on achieving happiness: don't put yourself in a position where you need to beseech investors for money.

    (The photo of Xiong above is by Mark Doerschlag.)

    The POPSignal Mix party report

    Posted by Scott Kirsner March 24, 2010 11:59 AM

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    POPSignal is an occasional networking event that brings together people in the Boston tech community. Founded by Viximo's Brian Balfour and Jay Meattle of Shareaholic, they hold occasional giant come-one-come-all shindigs for hundreds of people (often at Landsdowne Street clubs), and also smaller gatherings of founders and investors that they call POPSignal Mix events. These you have to be invited to, or recommended by someone who is already involved with the group.

    Last night was their first Mix event that brought together alumni of the five prior Mix gatherings, at the Enormous Room in Central Square. The room was too dark for decent iPhone photography (see the egregious example above, of Chris Keller from HubSpot and Matt Lauzon from Gemvara), but here's who was there...

    BetterLesson founder Alex Grodd, happy to have landed a second round of funding from the New Schools Venture Fund... Sean Lindsay from Viximo... Marginize founder Ziad Sultan, who is working on the start-up full-time, and has moved from being an analyst at Longworth Venture Partners to an entrepreneur-in-residence.... Healy Jones from OfficeDrop (formerly Pixily), a former principal at Atlas Venture who helped William Sulinski of AccelGolf raise angel funding earlier this year (the mobile golf apps company has employees now in Massachusetts and Maine)... Anupendra Sharma from Siemens Venture Capital... Jon Pierce from Betahouse...and Rob Go from Spark Capital.

    Ariel Diaz from Youcastr told me that we both once worked for the same management consulting firm, Lochridge & Company (though not at the same time), and we both hail from Miami... Dave Balter from BzzAgent was in the house, as was Flipkey founder TJ Mahony, now majority owned by Expedia & reporting in to their TripAdvisor subsidiary... Chris Sheehan of CommonAngels and Scott Friend from Bain Capital Ventures... Northeastern student and BostInnovation staffer Jennie White was scouting for stories, no doubt... but Google exec Rich Miner told me that a rumor posted to the site earlier in the day, that Facebook has a small development team working in Cambridge, possibly in Google's offices, was not true — though Facebook setting up shop in town would certainly be a good thing.

    The aforementioned Lauzon said his custom jewelry start-up, Gemvara (formerly Paragon Lake)  is close to closing a B round of funding, but that Deb Besemer, who'd joined as CEO last year, is no longer in that post; instead, she's serving as chairman and coaching Lauzon, who is once again running the company. Guess some hires don't work out. 

    Keller apparently got a new nickname earlier this month on the trip down to South by Southwest, when friends were mocking him for being the only attendee at that conference to not own a smartphone. (He still uses a Motorola RAZR.) They set up a blog and Twitter account to harangue Keller, whom they've dubbed Razrdude.

    Making technology more touchy-feely, this week in Waltham

    Posted by Scott Kirsner March 24, 2010 07:25 AM

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    Touch is the topic of the week in Waltham, starting tomorrow, when the Haptics Symposium comes to town.

    It's mainly an academic event, but among the exhibitors will be Woburn-based SensAble Technologies, one of the pioneers of incorporating the sense of touch into computing. Their Phantom peripheral, pictured at right, is both an input and output device: when you hold the stylus at the end, you can do things like practice a surgical procedure or sculpt a block of clay into a prototype cell phone. Your actions are reflected in three-dimensional models on your screen, and you also feel the effect your actions are having on the object, whether it's skin you're slicing or clay. (The device in the picture is the Omni model of the Phantom, which sells for about $1000; more sophisticated Phantoms go up to $80,000.)

    The company spun out of MIT in 1993, making it pretty ancient for a venture-backed start-up. Earlier this month, SensAble announced it had raised another $8 million from investors including North Bridge Venture Partners in Waltham.

    The company's Phantoms (about 8,000 have been sold so far) are used by designers at companies like Mattel, Hasbro, Converse, and Gillette to shape new prototypes, but chief technology officer David Chen tells me the two biggest growth areas are medical and dental applications: surgeons can use it to practice a procedure on a 3-D model of your anatomy before they actually get you on the table, and dental labs are using the technology to "help them design crowns, bridges, and dentures," Chen says. York University in Toronto has also written software so that the Phantom can be used — with a stick attached — to test the skills of hockey players before the NHL draft.

    The new round of funding will help the company build momentum in the dental industry, says Chen, adding that "our other business lines are profitable." The company has 45 employees, and VP of sales and marketing Joan Lockhart says the 2010 plan is for "very aggressive growth." None of the founders is still involved with the company. (I should disclose that I did some consulting for SensAble, helping improve its Web site, back in 1997 and 1998 when I was not working full-time as a journo.)

    SensAble will be highlighting its QuickHaptics API at the Haptics Symposium this week, aimed at making it easier for software developers to build touch-enabled applications.  


    30_30: Seeking your thoughts on New England's most promising young innovators

    Posted by Scott Kirsner March 23, 2010 07:39 AM

    Here's a little project I could use your help on: 30_30, a list I'm compiling of 30 people under the age of 30 who are making important contributions to the innovation economy here in New England.

    They can hail from any field, whether life sciences or cleantech or financial services or social media. They can work in a tiny start-up or a big, publicly-traded company. They can be founders, programmers, bloggers, or lab techs. They can be students or working stiffs.

    The single criteria I'll use to put together the list: what have they done to make their organization — and our region — more innovative? (And have they not yet hit their 30th birthday?)

    There are two ways to nominate people: you can e-mail me using the form at right, or by clicking on my name (where it says "About the blogger"), and including "30_30" in the subject line. Or you can post a comment below.

    No need to write a long essay about your nominee's achievements thus far — a few lines will suffice, along with their name, title, and company. And if you are sending your nominee via e-mail, please include the nominee's e-mail address, too. 

    I'd love to hear from you by next Friday, April 2nd. Thanks for helping!

    In support of the Startup Visa

    Posted by Scott Kirsner March 19, 2010 07:18 AM

    If you think we could use a few more jobs in the U.S. right about now, you should know about the Startup Visa, an idea that has been gaining momentum in the blogosphere since last spring. Last month, Senators John Kerry and Richard Lugar introduced a bill that would create a new class of visa for foreign-born entrepreneurs who start companies (and attract funding for them) here.

    Ex- Cantabrigian Paul Graham, an entrepreneur who sold an e-commerce company to Yahoo in the late 1990s and is now well known as the founder of Y Combinator, got things rolling last April with a post titled "The Founder Visa." Graham wrote:

    The biggest constraint on the number of new startups that get created in the US is not tax policy or employment law or even Sarbanes-Oxley. It's that we won't let the people who want to start them into the country.

    Letting just 10,000 startup founders into the country each year could have a visible effect on the economy. If we assume four people per startup, which is probably an overestimate, that's 2500 new companies. Each year. They wouldn't all grow as big as Google, but out of 2500 some would come close.

    By definition these 10,000 founders wouldn't be taking jobs from Americans: it could be part of the terms of the visa that they couldn't work for existing companies, only new ones they'd founded. In fact they'd cause there to be more jobs for Americans, because the companies they started would hire more employees as they grew.

    Brad Feld, a venture capitalist at Foundry Group, circulated Graham's idea to several U.S. representatives. Feld is also an MIT alum and founder of TechStars, a program in Boulder, Boston, and Seattle which invests small amounts in a few dozen start-ups each year, connects them with mentors, and gives them free office space for several months.

    Last September, Feld wrote on his blog:

    Two of the ten TechStars Boulder teams were comprised of non-U.S. founders — two from Canada and two from the UK. Both lived in Boulder for the summer and want to relocate here and build their businesses in the U.S. (and — specifically — in Boulder). Over the summer we struggled to figure out ways to get them visas — all of the proposed approaches were expensive, risky, and tiresome. Both companies are still trying, but each [is] now seriously considering returning to their home countries to build their businesses.

    I cannot come up with a single reason why this makes any sense from a U.S. perspective. These are young, talented entrepreneurs that have come out of a three month program with amazingly interesting startups. They are in the final process of raising their first rounds of financing. Post financing they will be creating U.S.-based high-tech jobs. If they are successful, they will create a lot of jobs. Plus, they are young so they will do this multiple times in their lifetime.

    A number of local venture capitalists signed on to support the idea, representing firms like Spark Capital, .406 Ventures, and Flybridge Capital Partners. And earlier this month, the board of the Massachusetts Technology Leadership Council voted to support the legislation introduced by Senators Kerry and Lugar, which would issue at most 10,000 visas a year (and probably many fewer than that.) Entrepreneurs who hope to obtain one of the new visas must raise $250,000 in funding from an investor in the U.S., and they become a permanent legal resident after two years if their company has either raised an additional $1 million, hit $1 million in revenue, or created at least five full-time jobs in the U.S.

    MassTLC president Tom Hopcroft explained the trade organization's support for the idea on his blog:

    First, throughout our history we've relied on foreign-born entrepreneurs to help spur economic growth. Nationwide, about a quarter of our technology companies have been founded by immigrants. Here in Massachusetts, some of our most notable tech giants were created by brilliant, visionary immigrants like An Wang of Wang Laboratories, Desh Deshpande of Sycamore Networks, and Ash Dahod, who recently sold Starent Networks to Cisco for nearly three billion dollars.

    Second, now more than ever, our foreign-born students can return to their home countries to find opportunity. A recent study found that 52 percent of the Chinese students attending U.S. colleges and universities believed they would find greater opportunities if they returned home after graduation.

    With some 445K students currently enrolled at Massachusetts colleges and universities, we naturally have one of the nation's largest pools of foreign-born students, a disproportionate talent asset that, in turn, can create tremendous innovation and wealth in our Commonwealth. We need to retain every one of those students who is willing to strike out on his or her own to start a company and create new jobs and wealth in our Commonwealth.

    ...To maintain our leadership position, we need the best entrepreneurs — domestic and foreign-born — to stay here and build tomorrow's leading technology companies in the Commonwealth.

    I'm on board. Are you? Do post a comment.

    Zthere turns smartphones into a collaborative tool

    Posted by Scott Kirsner March 15, 2010 09:54 AM


    Ever try to use your mobile phone to talk someone through changing a tire, fixing a complicated piece of industrial machinery, or defusing a bomb — and just wish you could just draw them a picture, or point to the relevant wire you're trying to get them to yank?

    A Cambridge start-up called Zthere has a nifty solution to that vexing situation. The company has developed software that uses a smartphone's built-in camera and its ability to record and transmit spoken instructions to enable what you might call "annotated collaboration." Just snap a photo of that ticking time bomb, and a far-off expert can draw on the photo, drop virtual push pins on key spots, and talk you through the steps you need to take. 

    Zthere's founders are serial entrepreneurs Matthias Wagner and Dan Ostrower. Ostrower writes via e-mail, "The idea was born out of frustrations that Matthias and I have had during years of hardware development and entrepreneurship. For example, flying people to Asian manufacturers to solve problems we felt there should be a way to solve remotely. ...We started asking ourselves, 'How could you show a tech in a factory how to use a thermal camera without sending him to training and without having someone next to him showing him what to do?'"

    Ostrower says they like to describe the concept as similar to WebEx or LogMeIn (services that let you hold online meetings or access a remote computer) — but for the real world. Development of the product started last fall, and Ostrower showed me an iPhone demo last week that looked pretty smooth. You can choose to record and store a "session" to be viewed later — an annotated photo with audio that talks the viewer through replacing an air conditioner filter, for example. Or, if you have access to a 3G or WiFi network, you can collaborate in real-time, pointing and dropping push-pins on one another's screens and asking questions.

    Zthere plans to release a free iPhone app later this year; an alpha test is happening now. Next will be an Android app and a Web-based version of the software.

    As for the revenue model, the current plan is to offer a subscription-based service to business customers. "We are targeting segments and applications where Zthere can have significant payback — equipment service, remote manufacturing management, construction management, public safety, military, etc.," Ostrower writes. His hope is that it'll be a new way for people in big companies to share their expertise, no matter where they're based.

    Ostrower tells me he and Wagner have been self-funding the company thus far (and relying on hired contractors for development), with the goal of raising outside capital at the right time. Their previous start-up, RedShift Systems, a developer of inexpensive thermal imaging cameras, has raised $18 million so far (RedShift is still working on getting a product to market). Ostrower was also an early team member at SMaL Camera Technologies, which was acquired by Cypress Semiconductor in 2005. (Cypress flipped it to years later to Attleboro-based Sensata Technologies, which went public earlier this month.)

    Here's the YouTube video demo:


    If you're interested in participating in Zthere's beta test, Ostrower says their bias is toward teams of business users who need to collaborate.

    The Pitch Taxi: Making investor connections at Logan Airport

    Posted by Scott Kirsner March 12, 2010 02:11 PM

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    Jeremy Levine's Scion xB is not a licensed cab, but when the Silicon Valley blogger and angel investor Dave McClure sent out a tweet that he was flying into Logan on Tuesday, Levine decided to offer him a lift. 

    McClure has been an employee, investor, or advisor to companies like Mint.com, SimplyHired, SlideShare, PayPal, and Facebook, and he was coming to Boston for a series of meetings and events. When Levine, founder of the start-up StarStreet Sports, saw that McClure was headed east, he offered him a ride from the airport

    Levine said they'd communicated a bit before on Twitter, so McClure wasn't exactly surprised when Levine filled him on on StarStreet, which he calls a "stock market for sports"; you can buy and sell "shares" in professional athletes, which would rise and fall based on their performance, using play money. (Levine's hope is to introduce real money at some point — and he believes he can do it legally.) "He was definitely really interested, and we're going to keep talking, but we're not raising money now," Levine says. 

    Earlier this year, Levine and his three co-founders were accepted into the TechStars Boston start-up spring training program. He showed McClure a short video on his iPhone of the TechStars Boston participants beseeching McClure to stop by their office in Central Square, but McClure didn't have the time in his schedule for that. In a tweet about getting a lift from Levine, McClure jokingly referred to Levine's car as the "PitchTaxi" and himself as a "CaptiveVC."

    Levine told me that StarStreet did a bit of early testing of its trading system during the NFL season, and they're about to crank up a second test that will run during the March Madness NCAA tournament.

    If you'd like to check it out, he has created three invites for Innovation Economy readers: just use the invitation code INNOECO here.

    $10-a-month math help, from Newton-based TenMarks

    Posted by Scott Kirsner March 2, 2010 08:00 AM

    Joining Boston's cluster of e-learning ventures is TenMarks, a company focused on helping kids improve their math skills. 

    Following an initial assessment test, students get a customized curriculum that can cover any of 1000 mathematical concepts from fractions to the area of a triangle. "When kids listen to music, they want to hear their own playlist," says co-founder Rohit Agarwal. "Any kind of media and content that kids are consuming outside of the classroom is personalized to them. But fundamentally, teaching hasn't changed."

    The company is initially planning to market the subscription-based service ($10 a month, following a 15-day free trial) to parents with kids in grades three to ten. But there are also pilot programs happening at Boston-area schools, and a national after-school program, and Agarwal says TenMarks will also pursue that kind of high-volume customer relationship.

    The company hopes to eventually expand its online learning programs to other subjects. "Parents have told us that they want grammar and vocabulary to be next," Agarwal says.

    TenMarks co-founder Andrew Joseph says the company has already developed "hundreds of thousands of questions and problems, which each have three hints to help students get to the answer, and a step-by-step solution that shows exactly how to do it." There are also more than 2000 video lessons, of three-to-five minutes each.

    TenMarks, founded in late 2008, raised its first outside financing last September, from a group of angel investors that included Jill Preotle, Jean Hammond, and Kelly Pope, formerly VP of technology at Classroom Connect. The company officially launched its service last month.

    E Ink's Russ Wilcox: The Exit Interview

    Posted by Scott Kirsner March 1, 2010 01:26 PM

    Xconomy Boston broke the news this morning that Russ Wilcox, the co-founder and long-time CEO of Cambridge display maker E Ink, has left the company after 13 years; Wilcox was the last member of the founding team to take off, following the company's acquisition last year by Prime View International of Taiwan for $450 million.

    I caught up with Wilcox this afternoon, who told me that "if there ever was a right moment to leave after selling [the company], this was it."

    The acquisition of E Ink closed last December 23rd, and Wilcox said he didn't have a contract that required him to stick around for a specified period of time. Prime View chief executive Scott Liu, who works out of Taipei, will take over as E Ink's chief executive. "He's trying to take the two management teams and integrate them," Wilcox said. "Having spent the last six years as a CEO, I didn't want to do a staff job, and become a functional person, and I didn't want to step on [Liu's] toes."

    E Ink grew revenues at 80 percent, 90 percent, 140 percent, and 250 percent over the last four years, Wilcox said, supplying displays for certain Motorola cell phones, the Amazon Kindle, and the Sony Reader, among other products. 

    The company has been investing in R&D to develop color display technology. "To stay on that [growth] track, we — they — absolutely need to have some color," Wilcox said.

    As for Xconomy's suggestion, based on a LinkedIn status update, that Wilcox is considering a "smart energy venture next," Wilcox said that he'd merely been visiting his friend Kevin Johnson, CEO of OutSmart Power Systems, and learning about their plans for intelligent wiring systems for commercial buildings that can more efficiently manage power consumption.

    "I want to go off and do something new," Wilcox said, "and the most important thing is to pick something you care about, and that's good for the world. I want to pick a very hard goal that's truly challenging, but within that, there are a million ways to build businesses." Wilcox said he might shy away from another materials science start-up that's at a similar stage as E Ink was at when he helped shepherd it out of MIT's Media Lab. "I might pick something that's a little further along," he said. 

    Wilcox's latest LinkedIn status update: "...taking a pause before starting the next adventure and will be reading happily on his many various E Ink devices."
     

    Numote prepares to launch 'social remote control' for iPhone, Android, and TV

    Posted by Scott Kirsner March 1, 2010 07:05 AM

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    I love the slogan for Numote, a new TV remote control technology launching this month: "Waste your time better." 

    Founder Vijay Kailas finished up at Harvard's Graduate School of Design in 2008, and started developing the Numote concept shortly thereafter.

    "We call it a social remote control for television," Kailas told me last week "It helps users find content to watch, interact with their friends, and get recommendations of shows they'll like." You can see what your other Numote-using friends are watching right now, and whether they love (or hate) a particular show that's coming up next. Numote also helps you find content related to a show online — tapping into Ellen DeGeneres' Twitter feed, for instance, while watching her talk show.

    One element of Numote is a mobile phone app that will be available for the iPhone and Android platforms sometime in March, Kailas says. (There will be both free and paid versions.) And in April, the company plans to start selling the second piece: a small set-top Bluetooth receiver (they call it "the pebble") which lets you use your phone to change channels. The pebble, designed by ex-IDEO staffer Gerd Schmieta, will sell for about $70. (See photo below.) "We plan to sell it through our own site, and several online retailers," Kailas says. 

    "Right now, on your on-screen programming guide, you just get a blurb written by somebody who probably doesn't watch the show," Kailas says. "We're creating a community that explains the appeal of the show — what people like and don't like. We're using your social graph to make recommendations, because most of the time, you discover great shows through your friends." Numote will tap into your existing network of friends using Facebook Connect.

    The company has been funded so far by Kailas' friends and family, and an angel investment from David Rose, founder of Ambient Devices. The company doesn't have office space of its own yet, but is based in and around Central Square. (I mentioned them briefly in yesterday's Globe column on challenges facing start-up consumer electronics companies in Boston.)

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    Haverhill company testing new wireless tracking system for runners, thoroughbreds, and running backs

    Posted by Scott Kirsner February 22, 2010 12:22 PM


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    When Olympic medalist Bernard Lagat set a new American record in Boston earlier this month, he was wearing a wireless tracking tag from Haverhill-based Lynx System Developers Inc.

    As Lagat rounded the track at the Reggie Lewis Track and Athletic Center in Roxbury, running the 5000 meters in thirteen minutes and eleven seconds, the tag relayed information about his precise position on the track to a Lynx computer system in a control room above the action, which enabled a robotic camera to closely follow Lagat, and provided detailed new information for the ESPN announcers who were calling the race.

    Lynx, founded by MIT grads almost twenty years ago, has high hopes for the new system, which it describes as "radar for sports." Players wearing the battery-powered, ultra-wideband tracking chips — which are a bit smaller than a book of matches — can be located in a stadium within about six inches. "It's sort of like having a localized, indoor GPS system," says Brian Rhodes, a Lynx project manager who has been supervising the testing of the system. "You get location updates 25 times a second, and with that we can tell how fast someone's moving, or how fast they're accelerating." (Rhodes, who ran track at UNH, is on the right in the photo below, with Lynx software engineer Jerry Reilly in the control room at the Reggie Lewis Center.)

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    At the Reggie Lewis Center, the chips talk to six wireless data receivers located around the building. The collected data about players' location can be viewed in real-time on a laptop, to give announcers information about estimated finish times, for instance, or can be replayed afterward by a coach to help runners identify the points in a race where they may have slowed down.

    The company is initially hoping to deploy the system for track and field events, football, and horse racing. They've already done tests at the Reggie Lewis Center and at high school football games in Andover, and this week, Lynx plans to install a system for testing at the Laurel Park racetrack in Maryland. (The first permanent installation was done last year at Texas A&M University, and at the Big 12 Championship.)

    The tracking system, which the company has dubbed IsoLynx, is part of a diversification strategy, says Lynx chief executive Ed Evansen. The 39-person company already holds a dominant position in digital photo finish technology; Lynx cameras are used in 110 different countries, and at events that have included the Olympics, Olympic trials, the Tour de France, and the Indianapolis 500.

    "We created the first digital photo finish cameras to give you instant results," Evansen says. "But the photo finish market is somewhat limited. If you don't have a finish line, we can't help you." 

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    For the last three years, Lynx has been developing the new tracking system. "A holy grail," Evansen says, "has always been the ability to track athletes as they move around a field or racetrack," and use the information to analyze games as they unfold, or for coaching purposes afterward.

    Rhodes adds, "You could have a camera that can always follow the leader, or a certain player on the field, without needing a person to operate it." (In hockey, the robotic cameras might be told to track players with a tendency to start brawls.) And there's also the possibility to use all that positioning data to create 3-D animations of a sporting event after it happens. 

    For football coaches reviewing video after the game, it can sometimes be tough to understand who was on the field for a given play, explains Jerry Reilly, another Lynx engineer: "We can show you which players were on the field, and you can click on a player's name and see exactly where they ran and what they did during the play."

    With horse racing, since money is involved, "there's an insatiable demand for any piece of data that might give you an advantage," Reilly says. "With this system, you can get a split for every inch of the track, and you can see all of the velocity and acceleration peaks for each horse."

    Evansen won't say yet what the system will cost — so it's tough to gauge just how much value it will have to deliver to announcers, bettors, or coaches for it to find a spot in the market. The company plans to team up with different distribution partners for different sports, and is clearly interested in talking to the NFL.

    Several video demos of the IsoLynx technology are available on YouTube. Below are videos showing the system in use during Lagat's 5000 meter record-setting run, and an Andover/Chelmsford junior varsity high school football game.





    Recorded Future: It's like Google Meets Nostradamus

    Posted by Scott Kirsner February 18, 2010 07:44 AM

    recordedfuture.jpgWhat if you could scour the Web for predictions, forecasts, and estimates about what might happen next year, or in a decade?

    The founders of Recorded Future, a new Boston area start-up, believe there is value in applying Google-like search capabilities and a simple interface to a tightly constrained set of data: occurrences that are expected or predicted to happen tomorrow and beyond. The site presents three input boxes — what, who/where, and when — and presents text search results, charts, or timelines. You might search, for instance, for IPOs in Massachusetts that are expected to take place this year, or pharmaceutical companies in Europe planning to begin clinical trials in 2011. You can also set up e-mail alerts to be notified when Recorded Future finds fresh data. (It searches across blogs, news outlets, and social media sites.)

    "Recorded Future allows financial analysts, intelligence analysts, and predictors to organize and aggregate future observations with ease," the company explains in a short description on its YouTube channel. On the company's LinkedIn page, the company, founded in late 2009, boasts that its "customers are some of the top government agencies and trading firms in the world."

    Christopher Ahlberg is co-founder and CEO, but he isn't talking about the company yet. "We want to stay out of [the] public eye for a bit longer," he e-mailed yesterday. He wouldn't confirm where the company is based or when they're planning to formally launch, either. But like Ahlberg's previous start-up, the business intelligence firm Spotfire, Recorded Future seems to have operations both in Boston and in Sweden, Ahlberg's country of origin. (Spotfire was acquired by Tibco in 2007, for $195 million in cash, and Ahlberg stuck around as an EVP there for just under two years. Spotfire had raised about $40 million in funding over its 11 year lifespan.)

    Also involved with Recorded Future as a founding member of the board is Andy Palmer. He didn't return my calls or e-mails seeking information about the company. Palmer did, however, post a completely unbiased comment (using his Twitter username "pigratdog") on the company's YouTube page: "This is an incredibly powerful results navigation interface — truly game changing."

    I'm told by a local venture capitalist that Recorded Future hasn't yet raised a venture round, but has only received money from its founders and angel investors.

    And while the Recorded Future interface, with its three input boxes, looks remarkably similar to the travel search site Goby, there's no link between the two companies except for Palmer, who serves on both boards. While conceptually similar, "it's not the same technology," Goby chief executive Mark Watkins told me yesterday. "They're a completely separate company." Neither Flybridge Capital Partners nor Kepha Partners, two local firms that have backed Goby, have invested in Recorded Future (yet).

    While there are all kinds of questions about how well Recorded Future will do at locating and labeling information about the weeks, months, quarters and years ahead, harnessing the wisdom of crowds with this kind of temporal search could prove valuable.

    Recorded Future's homepage features a quote from British prime minister Benjamin Disraeli: "What we anticipate seldom occurs; what we least expected generally happens."

    Here are two YouTube videos that offer a good feel for what the company is up to:
    FULL ENTRY

    Sparkcloud, angel money already in the bank, is first company to join TechStars Boston for 2010

    Posted by Scott Kirsner February 17, 2010 07:15 AM

    An Innovation Economy reader called my attention to this Craigslist posting yesterday from Sparkcloud, a very early-stage start-up company. In the ad, which seeks a "founding developer," the company mentions that it has been admitted into this year's TechStars Boston program, which offers mentorship and up to $18,000 in seed funding.

    That makes Sparkcloud the first company we know of to be included in this year's program; director Shawn Broderick tells me that TechStars doesn't officially announce start-ups as they're selected, leaving decisions about publicity up to them.

    Sparkcloud has also pocketed some angel funding from Bill Warner, founder of Avid Technology, who happens to shack up in the same Cambridge Coworking Center space as Sparkcloud founder Nick Tommarello.

    What's Sparkcloud up to?

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    FULL ENTRY

    Is Ohio the next destination for flying car company Terrafugia?

    Posted by Scott Kirsner February 16, 2010 11:51 AM

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    Ohio's license plates boast that the mid-western state is the "birthplace of aviation pioneers," including the Wright Brothers and John Glenn.

    It could also soon be the new home of two would-be aviation pioneers: Carl and Anna Dietrich, who are trying to bring to market the first successful flying car (or, if you prefer, roadable aircraft), the Terrafugia Transition. The Dietrichs, both MIT alums, currently run Terrafugia out of some warehouse space in Woburn. The slick-looking Transition vehicle, which can either be flown or driven at highway speeds, made its first flight last March. (I initially wrote about Terrafugia in the Globe in 2008, and again here late last year.)

    Carl Dietrich called yesterday to tell me that he was "very close" to signing a term sheet with a group of private investors in Ohio that would force Terrafugia to relocate there. Dietrich says the company is hoping to raise $4 million to build its next prototype vehicle, which it hopes to unveil at a major airshow this summer, and then go into production. 

    Dietrich isn't eager to move the company, fearing that he'd lose some key team members. "I would really like to stay in Massachusetts," he says, adding that he has identified a larger space for the company near its current Woburn facility. But "I need a good reason to stay," Dietrich says — meaning somewhere in the neighborhood of $4 million of equity investment. And while he has talked to state economic development officials, they typically don't dangle incentives to pre-revenue companies with ten employees that don't yet manufacture a product. Venture capitalists haven't seemed interested in putting their money into an aircraft company, even though Dietrich points out that Terrafugia has a $14 million order backlog. "There are more than 70 people in line to purchase the Transition, and each of them has written a deposit check to hold their place," he says.

    He envisions starting production as early as 2011, and eventually growing to employ about 200 people.

    One of Terrafugia's investors told me today that the company has raised a couple million dollars from individuals, mainly in the Boston area so far. "They've been very scrappy" in how they've used this money, he said, "and they've done a fantastic job at getting their first plane to fly for very short dollars." But if they can scare up several million bucks in one fell swoop, rather than going out to try and raise more every six months, then Terrafugia may have to simply follow the money to Ohio, he added. (The company would likely wind up near Dayton.)

    Dietrich observes that DARPA, the Defense Advanced Research Projects Agency, recently said it is interested in developing a flying vehicle capable of carrying one to four passengers (the Terrafugia carries two). He is hopeful that Terrafugia might eventually be a sub-contractor on that program, bringing in some early revenue.

    Like all entrepreneurs, Dietrich is convinced that what he's trying to do is inevitable, obvious, and will solve problems that no one else takes seriously enough. (Among them: pilots who unwisely try to fly through bad weather to get to their destination, or who would rather keep their plane in their garage instead of renting expensive hangar space.)

    "I know everybody sees this as a bigger risk than I do," says Dietrich. "To me, this is a pretty straight-forward thing."

    After selling to AOL, Going.com CEO hits the open road

    Posted by Scott Kirsner February 12, 2010 07:39 AM

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    When last we heard from Evan Schumacher, last June, he had sold his what-should-I-do-tonight start-up, Going.com, to AOL. The acquisition required that he and the other employees of Going.com stick around for six months. By the end of the year (roughly six months + twenty days after the deal), Schumacher had not only started his next company, Open Mile, but he'd raised several million dollars in funding from Charles River Ventures in Waltham.

    Schumacher isn't saying much yet about what Open Mile will do, other than that he's returning to a field he has worked in before, with the Cambridge start-up Celarix: logistics and transportation. "We think Open Mile is going to be really disruptive to the way big shippers like Home Depot or Coke buy transportation," he says. "We're aiming to lower their costs, and increase the revenue for carriers." On Open Mile's Web site, he describes the company as a "virtual transportation broker" that will connect "premium brand shippers to thousands of small and medium-sized trucking companies" using mobile devices and the Web.

    Schumacher says he plans to be a bit more forthcoming about Open Mile in April, when the site will go live with its first few real customers.

    Schumacher's co-founders at Open Mile come from businesses like Going, Yantra Corp., and n2N Commerce. The partner at Charles River who made the investment was Devdutt Yellurkar. Yellurkar had been a founder of Yantra, a Tewksbury company that sold supply chain management software to customers like Best Buy and Motorola.

    It was tough to tell how much of a win Boston-based Going.com was for its investors, Highland Capital and General Catalyst Partners, who put about $8.5 million into the nightlife-oriented social site. When AOL bought it, it paid a reported $10 million for Going and another company, Patch Media. Let's just say the return was something less than 2x.

    Prior to joining Going as its CEO (he came in about two years into that company's life), Schumacher was CEO of Everypoint, a mobile app development company that shut down last December after raising about $14 million in venture capital from Venrock, Fairhaven Capital, and Prism VentureWorks.

    The company Schumacher started with a business school classmate in 1998 was Celarix, a supply chain visibility company. It raised about $50 million from Charles River Ventures and others before being acquired for an undisclosed sum in 2003. 

    Open Mile's blog is here; its Twitter account here. Schumacher's personal blog is here. The company isn't yet listed on Charles River's portfolio page.

    Where have all the receptionists gone?

    Posted by Scott Kirsner February 11, 2010 01:37 PM

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    Every week, I visit almost as many offices as a hard-working Dunder-Mifflin paper salesman, all across eastern Massachusetts.

    Increasingly, I've been noticing that the receptionist's desk is empty. Are receptionists a casualty of the recession? Are start-ups trying to prove they're being frugal with their investors' money? Both?

    Today I was in Waltham, visiting a start-up that has raised about $40 million in venture capital funding. This is a picture of their receptionist's desk — it has everything but the receptionist. As a visitor, you're expected to breeze past it, find someone sitting in the nearest office, and ask them for directions to the person you're there to see.

    Often, the people who work in offices or cubicles closest to the door try to avoid eye contact when you enter; they don't like acting as the de facto receptionists, resenting the continual interruption of their work. Sometimes there's just a phone sitting on the receptionist's desk, with instructions about how to call the person you're looking for.

    (You notice the lack of a receptionist when you call these companies, too: now, when you press 0 to talk to an operator, you inevitably wind up in a "general delivery" voicemail box. Does any human being ever check the messages left there?)

    I wonder how long it will take before the vestigial receptionist's desk disappears from the layout of most offices — or perhaps it'll remain as a symbol of corporate parsimoniousness?

    There are a few companies that still invest, however, in making a good first impression on visiting journalists, job-seekers, and potential partners. The last time I was visiting VistaPrint's U.S. headquarters in Lexington (May 2009), I took this photo of the receptionist's desk, mostly because I liked her title: "Director of First Impressions." I hope that Dottie is still there...

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    How to get laid off: the Don Dodge approach

    Posted by Scott Kirsner February 9, 2010 09:21 AM

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    I saw Don Dodge yesterday for the first time since he was laid off by Microsoft last November.

    Dodge had been a director of business development on Microsoft's emerging business team, essentially working with entrepreneurs and venture capitalists to encourage them to use Microsoft products and services, and also acting as a very important set of eyes and ears for his employer in the start-up world. Based in New Hampshire, Dodge was a regular presence at conferences and start-up gatherings on both coasts. Though not a senior executive at Microsoft, he was one of the company's most visible employees ever since Robert Scoble departed in 2006.

    Dodge is now a developer advocate at Google, encouraging software companies to build new applications that work with Google infrastructure. He went unemployed for 11 days before Google hired him, and he told me over coffee yesterday that he'd also fielded inquiries from three or four other big-name tech companies, including a popular social network founded a few years ago by Harvard undergrads.

    What can you learn from Dodge's situation?

    (In the photo above is Dodge with M.C. Hammer. Dodge is on the right.)
    FULL ENTRY

    Two more start-ups aim to answer the question 'What's worth doing tonight?'

    Posted by Scott Kirsner February 8, 2010 11:30 AM

    Sponty and Riotvine want to amp up your social life, helping you post local events worth going to, and ideally gather some like-minded friends who might want to join you. 

    It's an area where it'll be tough to gain momentum, given that Facebook is heavily used for sharing events, and Upcoming (now part of Yahoo) and Eventful have been around for a few years. Also, Boston-based Going.com tried to digitize our social lives, raising about $8.5 million in venture capital without really achieving critical mass. (It was acquired last year by AOL.)

    Sponty co-founder Fayez Mohamood says his site has a tight focus on music. And the site is geared to encouraging you to follow "moguls" (taste-makers) who might lead you to great shows you wouldn't have discovered otherwise. "It's all about finding events through people," Mohamood says. Sponty's free iPhone app launched in December, and the ability to post events directly from Twitter came online in January. Sponty was a "side dish" demo-er at Web Innovators Group gathering last December.

    Sponty and Riotvine are both predominantly focused on happenings in Boston at this stage, though Riotvine just launched two new cities, Austin and San Francisco, last week. Riotvine founder Kabir Hemrajani tells me that contests and ticket giveaways have proven the most effective way to attract new users to his site. One neat Riotvine feature is being able to see all the tweets related to each artist (granted, sometimes they are not that related), which sometimes contain links to music samples, videos, or reviews of past shows, and give you a sense of the buzz a given performer is getting.

    Both Sponty, based in Cambridge, and Riotvine, based in Boston, are boot-strapped two man companies. Mohamood says he's currently in talks with some potential angel investors, and Hemrajani had a chance to publicly pitch Bain Capital Ventures Venrock a few weeks back as part of DartBoston's Capitalize series. Hemrajani says he left his full-time job last fall to work on RiotVine full time, but Mohamood is a still full-time employee at The MathWorks, developing Sponty on the side with co-founder Mahmoud Arram.

    Both start-ups, interestingly enough, will be down in Austin, Texas next month for the big South by Southwest music festival, hoping to generate some buzz. (It's the first time for Mohamood, though Hemrajani attended last year.) That's the same event that put some wind in the sails of both Twitter and Foursquare.

    Update: an Innovation Economy reader points me to yet another new site with the alluring name Instant Nightlife, founded by Shahriar Khushrushahi and an MIT-affiliated crew.

    General Catalyst invests in CyPhy Works, new venture from iRobot co-founder Helen Greiner

    Posted by Scott Kirsner February 4, 2010 08:35 PM

    News surfaced yesterday in an SEC filing that Helen Greiner's new robotics company, CyPhy Works (formerly The Droid Works), had raised its first round of venture capital funding: $1.75 million from Cambridge's General Catalyst.

    Greiner's company had previously won government grants from the National Institute of Standards and Technology and the National Science Foundation to develop nimble, remotely-piloted flying machines that can operate indoors and out. Possible uses: as a tool for emergency response teams when it may not be safe to enter a building, or for inspecting the underside of bridges and other hard-to-reach infrastructure.

    Managing director John Simon of General Catalyst is joining the board of Framingham-based CyPhy; he's also on the board of iWalk, another start-up founded by an MIT-trained roboticist, Hugh Herr.

    I caught up with Simon this afternoon to ask him about the two investments in areas where VCs usually fear to tread: robotics built primarily for state and government customers (CyPhy), and prosthetic devices for amputees (iWalk).
    FULL ENTRY

    Amherst-based CampusLive gets angel funding to build start pages for 600 schools

    Posted by Scott Kirsner February 2, 2010 08:40 AM

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    Putting the final touches on a $320,000 round of angel funding this week is CampusLive, a company run by a group of UMass/Amherst alums (and drop-outs) that creates lightly-customized homepages for students at about 150 colleges, and sells local advertising on them.

    Co-founder and CEO Boris Revsin wouldn't name the angels, other than to say that they are "a group of four guys, all based in the Northeast." Revsin said attorneys at the law firm Edwards Angell Palmer & Dodge helped make the introduction; CampusLive was recently chosen to participate in the law firm's "Helping Innovators Thrive" program, which offers free and discounted legal services to a group of five selected start-ups.

    Founded in 2007, the Amherst company pulls together links, news, a Google interface, and weather forecasts onto a single page, and sells subscription-based advertising to local restaurants on it, ranging from $50 to $200 a month. Food ordering doesn't happen through the site, but restaurants receive reports on how many students interact with their menus on CampusLive. (The company plans to offer other kinds of advertising, too, and says that 63 percent of its users visit their CampusLive homepage more than 100 times a month.)

    Revsin, who left UMass to work on the Mitt Romney presidential campaign, says the new funding will go towards building CampusLive's local sales teams. "We are selling in twenty markets now, and by the end of the year, I want to be selling in at least 150 markets," he says. Focusing on cities with multiple schools means CampusLive is planning to build portal pages for "at least 600 universities" this year, up from 150 currently.

    One way the site builds traffic and excitement around the homepages is by running raffles for prizes like Sony Playstations, and by offering BestBuy and Target gift cards to students who  do the best job of spreading the word about CampusLive via e-mail, blogs, Twitter, and Facebook.

    (Revsin is in the middle of the front row in the photo; on his left is CTO Jared Stenquist and on his right is COO Ryan Durkin.)

    A business school grilling for Curt Schilling?

    Posted by Scott Kirsner February 1, 2010 10:19 AM


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    The "Founders' Dilemmas" course at Harvard Business School hosts a high-wattage visitor tomorrow: retired Red Sox pitcher Curt Schilling, who'll be talking about his videogame start-up, 38 Studios.

    Founders' Dilemmas, taught by Noam Wasserman, focuses on "the tough, early choices that founders face that have important, long-term implications for them and their ventures." Wasserman recently published an amazing HBS case study on Schilling's transition from the world of professional baseball to the start-up sphere. It focuses on Schilling's decision to fund the Maynard company's first several years of development himself, and his thus-far unsuccessful efforts to bring in other investors to help bankroll 38 Studios, which is developing a massively-multiplayer role-playing game code-named Project Copernicus. (I wrote about Schilling's fund-raising efforts last July.)


    The case study is astonishing for how much financial (and psychological) detail it shares about Schilling's experience trying to get the business off the ground. From the opening paragraphs:

    It was April 2009 and Schilling felt he had taken 38 Studios to the brink, extending himself and his family both financially and personally. ...He admitted [while considering the acquisition of another gaming company, Big Huge Games], "I have put the majority of the money I've earned in my life on the table. If I make another financial investment, I will have crossed the point of no return from a personal investment and company standpoint."

    BaseballReference.com estimates Schilling's career earnings at about $114 million. Want to guess how much it cost him to operate 38 Studios, a 65-employee company, from 2006 to 2008?

    FULL ENTRY

    Somerville start-up takes fee-based approach to apartment rentals, challenging Craigslist

    Posted by Scott Kirsner January 27, 2010 07:45 AM

    Can Rental Beast gnaw off a piece of Craigslist's apartment rental business?

    It won't be easy, but the Somerville start-up is already profitable, and still plugging away six years after it was founded.

    For people hunting for an apartment, Craigslist has become the go-to destination: most of the inventory in big- and medium-sized cities shows up there, and using it is entirely free for prospective tenants. (Posting to Craigslist is free for landlords, too, except in New York City, where apartment brokers pay a small fee.)

    Rental Beast charges users a monthly fee to access what founder Ishay Grinberg says is a cleaner database of rentals, accompanied by better tools to let landlords evaluate potential tenants.

    "When you search for 'Back Bay' on Craigslist, you get thousands of results, most of which aren't even in Boston," Grinberg says. "And people often post listings there without a phone number to call — just an anonymous Craigslist e-mail address." Listings sometimes don't get removed, either, once an apartment is rented, which makes it hard to tell what's really available and what's not, Grinberg adds.

    Rental Beast makes it easy to sort through apartments that have been de-leaded, or come with off-street parking. Landlords, who post their vacancies for free, can conduct a credit check on potential tenants through the site for about $15. (Sites like Rent.com and Apartments.com are free for tenants, but charge landlords various fees.)

    Grinberg saved up the money to start Rental Beast — about $20,000 — while working as an apartment broker in New York City. That seed capital was enough to allow the site to reach profitability. Grinberg says the company, which has six employees, had net profits of $100,000 by 2008. (He says the company was also profitable last year, but won't share numbers.)

    Right now, Rental Beast only lists apartments in Massachusetts, but Grinberg is currently trying to raise some funding to expand its scope. "We want to go after the top three-to-five rental markets over the next three-to-five years," he says. "That includes cities like New York, Washington, D.C., Miami, and Chicago."

    Late last year, the site dropped its entry-level membership fee from $89 to $29, which allows for one month of unlimited access to the site; higher membership levels offer more personalized service, like advice about neighborhoods, help setting up appointments, and guidance on lease negotiations.

    Apartment vacancy rates are "as high as they've ever been," Grinberg says. That has encouraged landlords to try listing properties on less-established sites like Rental Beast — and has made renters less willing to pay a broker's fee.

    But in a world where Craigslist has made filling or finding a vacant apartment fundamentally free, can Rental Beast build a significant business by trying to streamline the process? We'll see...

    Project Concord: Stealthy video start-up has raised 'several million' from Andy Marcuvitz, formerly at Matrix Partners

    Posted by Scott Kirsner January 22, 2010 02:20 PM
    Update: As of March 2013, Project Concord has changed its name to HitBliss, raised more than $10 million, and launched a beta of its product.

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    My project for the week was to learn a bit more about Project Concord, a stealth mode start-up that has raised several million in venture capital funding — and is not, in fact, located in Concord but in Lexington.

    The company's site declares that it is developing "a new, more convenient way to experience your favorite movies and TV shows on demand, without having to reach into your wallet." 

    "Our approach is radically different from anything else being contemplated in this space, and it has the potential to benefit publishers and consumers in a groundbreaking way," the site promises.

    Sounds ambitious. Should iTunes and Hulu be frightened?

    None of the venture capitalists or entrepreneurs I spoke with this week, all of whom have had experience with digital media, had heard of the company. Even people who had met the founders, the husband-and-wife team of Andrew Prihodko and Sharon Peyer, didn't know much about what they are up to.

    Prihodko finally returned my call yesterday afternoon, and told me that Project Concord was founded in mid-2008, after he and Peyer left Waltham's NameMedia, the company that acquired their last start-up, Pixamo. (Pixamo was a photo- and video-sharing site the pair had launched while in business school; it never took venture capital funding, was acquired for an undisclosed sum, and has since been shut down by NameMedia.)

    Prihodko says that while he and Peyer were hunting for funding for Pixamo, they met Andy Marcuvitz, formerly an investor at Matrix Partners in Waltham. (Joe Lassiter, a Harvard Business School prof, made the connection.) "[Marcuvitz] liked us, but he didn't burn to invest in photo or video sharing, but we kept in touch," Prihodko told me. 

    Marcuvitz's Alpond Capital (the firm has no Web site) invested in Project Concord in the summer of 2008. Prihodko says he didn't really meet with other VCs. "We skipped the seed round -- it was a full-blown Series A" of several million dollars, Prihodko says. And the name Project Concord, which Prihodko describes as a placeholder? Several meetings with Marcuvitz took place in the Concord area, at restaurants like Vincenzo's. (Marcuvitz lives in nearby Lincoln.)

    Prihodko isn't saying much about how the company will approach the challenge of monetizing Internet video. "A lot of companies with much larger resources are gunning for it, and we're paranoid about getting crushed or out-run by them," he says.

    "The major thing we're trying to solve is how to make money off premium content, and we feel we've found a solution." He's hoping to start a beta test at some point in 2010, though he says it's contingent on how quickly the company can negotiate deals with Hollywood studios and other big content owners.

    Working alongside Prihodko and Peyer at Project Concord are veterans of Endeca and ITA Software. The company is currently hiring application developers and user interface designers.

    Marcuvitz wouldn't tell me how much money he has put into Project Concord, other than to confirm it's in the single-digit millions. "Where there's change, there's opportunity," he says of the digital video space. He suggested that I wait a while before writing about the company: "we've gone to great lengths to keep ourselves invisible." His other local investment is ZeeVee, a high-def video hardware company based in Littleton. Marcuvitz left Matrix Partners in 2004 after 14 years with the firm.

    (It was this brief listing on the excellent start-up blog Buzz in the Hub that first brought Project Concord to my attention. Turns out that Highland Capital is not an investor.)

    Highland Capital puts an end, at least temporarily, to its summer program for young entrepreneurs

    Posted by Scott Kirsner January 19, 2010 06:04 PM

    The Summer@Highland program, which aims to help undergrad and MBA students get a start-up off the ground, won't take place this summer, according to Michael Gaiss, senior vice president of marketing at Lexington's Highland Capital Partners. Gaiss describes the change as a "hiatus," implying that the program could return at some future date.

    "The firm has got other priorities right now," Gaiss told me on Friday. "We just have a finite amount of time and energy."

    For the past three summers, the venture firm has invited teams of student entrepreneurs to work out of its Massachusetts and California offices, while getting advice and guidance from Highland's partners (who include Staples founder Tom Stemberg) and the experienced entrepreneurs in the Highland network. 

    Gaiss says that five of the teams managed to raise money after the program, including Affine Systems in San Francisco and Paragon Lake of Lexington, which raised money from Highland itself. Wildfire Interactive of Palo Alto raised money from Facebook's fbfund in 2008. 

    "It has been a great program," says Matt Lauzon, co-founder of Paragon Lake, a customized jewelry start-up that still operates out of the office space Highland has used for the Summer@Highland program. "Everyone I've talked to has found it valuable." Without the program, Lauzon says his company probably would've moved out to Los Angeles, where his co-founder had connections in the jewelry industry. "It was that program and meeting [Highland partner] Bob Davis that kept us here," says Lauzon, who participated in Summer@Highland in 2007, its first year. (I wrote about Paragon Lake and the program back in 2008.)

    Last summer, Lauzon helped mentor the latest crop of Summer@Highland participants.

    In a notice posted today to Highland's site, the firm explains, "We will review the program again at the end of this calendar year for next summer and keep you updated." Last November, Highland announced it had raised its eighth venture fund (totaling $400 million), which was half the size of the fund prior.

    Business Week wrote this piece about the program in 2008.