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July 29, 2008

Who Will Be the Next Google?

The latest company to attempt to chip away at Google’s search dominance is getting quite a bit of attention.  Cuil, an engine that claims to return more search results than Google (120 billion pages, to be exact), was started by former Google engineer Anna Patterson and made its debut this week.  Cuil may be the most visible (for now), but there are a number of interesting search startups looking to challenge Google.  Here are a few of the standouts:

Mahalo

Optevi

Powerset (recently acquired by Microsoft)

True Knowledge

July 25, 2008

Funding of Note:

Payoneer - $8 million

Movie Set Inc. - $5 million

iYogi - $9.5 million

 

Kannuu Launches iPhone Search App

“Keyboard less” search startup kannuu has released a search/lookup application for the iPhone 3G.  Here’s the announcement: kannuu Debuts Lookup Solution for iPhone Application Developers.  We recently did a Q&A with kannuu—it’s an interesting service, and is certainly part of the next generation of Internet search: Q&A with kannuu

Another Gloom and Doom Article on Startups

Some good points here from Anupreeta Das of Reuters.  But aren’t truly viable ideas solid in both good times and bad?: Startups are a tough sell

Pure Networks Sold to Cisco

The home networking software maker was founded in 2002 and is based in Seattle.  Here is the Seattle PI with more: Pure Networks sold to Cisco for $120 million

The Mistakes of a Failed Startup

We all wonder about the “inside story” when startups fail.  Even though we all know that most don’t make it through the first couple of years, it sometimes seems inconceivable that really good ideas just never get off the ground.  Here’s an interesting take from an angel investor in a tech startup that didn’t quite make it.  From Information Week’s Startup City: Failed Startup Recounts Its Mistakes

GT Solar Has Big Public Offering…Then Tumbles

One of the few tech IPOs so far this year came this week from solar energy startup GT Solar.  The firm raised $500 million in its initial offering, but perhaps as an indicator of the current shakiness of U.S. financial markets, the stock dropped 11.6 percent in its debut: GT Solar raises $500 million in IPO, falls in debut

July 23, 2008

Featured Company: Envysion

Envysion logo 

Web Site: www.envysion.com 

Headquarters: Louisville, Colorado

Year Founded: 2006

Founder: Dan Caruso, Executive Chairman

Investors: Columbia Capital; High Country Venture; Bear Equity

Employees: 29

 

Matt SteinfortBy Matt Steinfort, CEO

 

Envysion provides a web-based video management service that enables organizations with multiple locations to use remote video to improve performance and profitability.  Envysion Video is an enterprise-level solution that transforms traditional surveillance video into a strategic management tool that enables increases in efficiency, quality, brand consistency and the bottom line.

Envysion Video solves two main problems.  The first is how to make video of multiple locations accessible to people throughout an organization.  Envysion Video allows authorized users to view, search and share live and recorded video of any number of locations via a single password-protected web interface.  Users can watch, analyze and improve whatever aspect of the organization they are involved with, whether it is security and loss prevention, operations, marketing, training or human resources.

The second is how to enable users to quickly find specific video.  By integrating video with a customer’s point of sale (POS) or other event-based business data, Envysion enables users to click on events in a report (such as "voids" or sales of a certain product) and immediately see the associated video.  Users can also create custom reports and receive automatic alerts when business rules that they define have been broken.

Founder's Story

Dan Caruso, Chairman of the Board of Envysion, Inc., was one of the founding executives of Level 3 Communications.  From inception in 1997 through 2000, Dan was responsible for engineering, construction and operations.  Between 2001 and 2003, he was responsible for most of the company's lines of business and marketing functions.

Between 2004 and 2006, Dan was president and CEO of ICG Communications.  In 2004, he led a buyout of ICG and took it private. ICG, at the time, had about $100 million of debt and was burning their remaining $30 million of cash at a rate of $8 million a month.  Columbia Capital and M/C Venture Partners, who backed the buyout, invested a total of $8.7 million.  In 2006, ICG was sold to Level 3 for $170 million, resulting in a total distribution to the buyout group and management of over $225 million and a total return on investment of 25 times.  The company was founded by former telecom executives who saw an opportunity to use their networking expertise to create a video service that takes full advantage of the power of the Internet.  Thus, Envysion is the first video company to converge the full networking power of the Internet with the world of video surveillance.  Video cameras are becoming ubiquitous, but until Envysion Video, there hadn't been an easy way to manage large numbers of geographically dispersed cameras and make them accessible to multiple people.  As is often true with the best new technologies, Envysion Video is spurring users to create their own ideas for how video can be used, moving beyond traditional security and loss prevention functions and into other areas such as marketing, human resources, operations and training.  This is the most significant impact of Envysion: it is enabling organizations to use IP communications in new ways and demonstrating that there are still many new uses and benefits of IP communications to be discovered.

Business model

Envysion’s business model is based on earning recurring revenue from software subscriptions.  Each Envysion Video sale has up to three parts: hardware, software and installation. The hardware includes the cameras and recorders plus any accessories such as monitors or integration with a POS system.  Envysion Video is camera-agnostic, so customers can provide their own video cameras rather than purchasing them from Envysion.  The hardware can be paid for up front or spread out over the period of the software subscription.  The software subscription includes licenses for accessing the Envysion Video application on the Internet for a specific period of time and for the number of cameras connected to the video recorder at each site.  The software is usually licensed for 36 or 60 months, and we encourage customers to pay on a monthly subscription basis, although some choose to pay for the software subscription up front. The installation fee is always paid at the time of the installation of any cameras or recorders.

Current needs

Envysion recently received another round of $3 million funding from an existing investor.  In the first half of 2009, the company will seek raise another round of capital.

As CEO of Envysion, Matt Steinfort is responsible for both the strategic direction and the day-to-day operation of Envysion. Prior to Envysion, Matt was SVP of Corporate Strategy at ICG Communications and held a variety of executive roles at Level 3 Communications, including VP of Consumer Voice, VP of Strategy and VP of Finance. Matt’s early career included stints at management consultancy Bain & Company and IT consultancy Cambridge Technology Partners. Matt received a BSE in Civil Engineering and Operations Research from Princeton University and an MBA from the MIT-Sloan School of Management.  

July 21, 2008

Cloning Facebook; Mixed Signals on the VC Front; Notable Funding

German Facebook Clone – An interesting example of how the Internet has changed the world of intellectual property.  One wonders how StudiVZ could so blatantly copy Facebook, one of the most successful and well-known Internet startups of the last ten-or-so years: StudiVZ Won’t Comment On Facebook Lawsuit, But Will Talk Smack In General

VC Funding Shrinks for Startups – While VC investment overall appears to be holding steady, this MoneyTree report suggests that capital investments may be shrinking for startups: Venture Investments Are Up, But Not For Startups

Funding of Note:

gumgum

Carbonetworks

Rohati Systems

Wakonda Technologies

ContextWeb

July 18, 2008

Just How Well Is Tech Weathering the Economy?

Tech Doing A-Ok in Bad Economy? – From the Wall Street Journal: Tech Firms Rise Above Economic Turbulence

On the Other Hand – There are indications that hard economic times may be affecting the online ad market.  From  Barron’s: ValueClick Warns On Q2; Trouble In Online Ad Market?

Geeking Up the Birthday Cake – Ok, so it’s been a slow week for tech news if you don’t cover the iPhone.  So I couldn’t resist this one.  Talk about putting the “geek” in baking: Millennium Falcon Cake Can't Hyperspace, But is Best Birthday Cake Ever

July 16, 2008

Tech Coast Angels Touts Success; Top Storage Startups; VCs—Maybe Not So Bad Off; Funding News

Tech Coast Angels Passes Billion Dollar Funding Mark – The Tech Coast Angels, which funds startups based in Southern California, has announced that it has now supported more than 150 companies and helped them raise 1 billion in third party and venture financing.  Here’s the announcement from TCA: Tech Coast Angels Surpasses One Billion Dollars in Third Party and Venture Capital Funding to Portfolio Companies

10 Storage Startups to Consider – There are so many technology startups in so many different sectors that it’s inherently difficult to keep up with them all in all verticals.  A critical sector that doesn’t get a ton of attention is storage, so I thought this list of storage startups from Byte and Switch was interesting.  Check it out:  Top 10 Storage Startups to Watch

Who’s Worried About VCs? – Despite the current well-documented downturn in the economy, and talk about a crunch in the venture capital world, venture investment worldwide isn’t decreasing.  In fact, it’s growing.  Here’s BusinessWeek’s take: What Capital Crunch?

Notable Funding:

Recurrent Energy - $75 million

Become.com -  $8 million

July 11, 2008

Editor's Notes: Five of the Most Interesting Apps from Startups

So, while nearly all tech news coverage today (I exaggerate, but just a bit) is about the iPhone 3G launch, I figured I’d venture out and highlight five of the most interesting and useful applications from startups that I’ve seen over the last year.  This is completely unscientific, so feel free to chime in with your own!

So here they are:

Xobni: Email management app.  Founded in 2006 and based in San Francisco.

Shopit: Bringing e-commerce to social networking in a way that seems intuitive and easy.  Founded in 2007 and based in Brentwood, Calif.

kannuu: Working to enable easier search.  Founded in 2006 and based in Irving, Texas.

Syncplicity: Not a new idea—data access across multiple devices—but perhaps the most comprehensive solution to date. Founded in 2007 and based in San Francisco.

Overlay.tv: Not sure if this will catch on with consumers, but an innovate step in advertising technology.  Founded in 2007 and based in Ottawa, Canada.

July 09, 2008

Editor's Notes: Yahoo! Looking at Demand Media?; New Funding

Yahoo! Looking to Purchase Demand Media? – In the midst of its on-again/off-again drama with Microsoft, Yahoo! may be courting Santa Monica, California-based Demand Media, a search marketing firm founded by the former CEO of MySpace.  Here’s TechCrunch on the rumors: Yahoo Takes A Gander At Demand Media To Plug Some Holes

Notable Funding:

Dimdim

Aircell

Alerts.com

BountyJobs

MEVIO

Spire.com 

July 03, 2008

Editor's Notes: Venture Capital Hits the Skids; Shopit Expands to AIM

Venture Capital Crisis? – After a second quarter without any venture-backed IPOs, the National Venture Capital Association is declaring a VC “crisis.”  Whether or not you buy this, the numbers do look pretty bad.  Here’s an excellent analysis, courtesy of TechCrunch: The “Crisis” In Venture Capital 

Some more perspective on the state of the VC biz, from Matt Richtel at the New York Times – A Quarter for Venture Capitalists to Cringe

On the same note, some banks are finding opportunity in the IPO drought – From The Wall Street Journal: As High-Tech IPOs Dwindle, Start-Ups Look to Private Money for More Backing

Shopit Releases AIM App – Social-commerce company and past StartUp Beat featured company Shopit this week announced the availability of an application that it says allows AOL AIM users to buy and sell items from their buddy lists.  Here’s the release: Shopit Mini-Store Application Now Available To AOL's AIM Users

Notable Funding:

Boomi

Intelligent Energy

July 01, 2008

Featured Company: Mocana

Mocana logo

Web Site: www.mocana.com

Headquarters: San Francisco, CA

Year Founded: 2004

Founder: Adrian Turner, CEO

Investors: Southern Cross Venture Partners, Shasta Ventures

Total Capital Raised: $12.1 million

Employees: 30

Company News: www.mocana.com/press.html

By Adrian Turner, Founder and CEO

Mocana is a security software company that delivers comprehensive protection for any embedded device or “thing” connected to the network.  This includes smartphones, PDAs, routers, switches, printers or VoIP phones, but also more everyday items like automobiles, home appliances, cash registers, power meters and HVAC equipment.  These “attached devices” are quickly outnumbering PCs.  Forrester Research predicts that there will be more than 14 billion devices on the net by 2010—and that 95 percent of these devices will be something other than a PC.

Product Line

Mocana offers its Device Security Framework (DSF) to deliver comprehensive protection for any device connected to any network, wired or wireless.  The Device Security Framework is made up of over a dozen separate Mocana product offerings that reside at different places on the device, network, or application stack to provide comprehensive device security and management.  Some of the DSF offerings are NanoSSL, NanoSSH, NanoUpdate, NanoBoot, NanoRadius and NanoSec.  Mocana’s DSF is designed for device manufacturers and service providers and includes design processes and software that are embedded into devices during the manufacturing process.  All components of the Device Security Framework feature an asynchronous event driven architecture, very high performance and very small memory footprint specifically designed for the special challenges that embedded device security engineers face.

The newest addition to the Device Security Framework is NanoDefender, an embedded Intrusion Prevention System technology that secures all aspects of a device: communications, identity, access, privilege, control and execution.  The new product, now being offered to device manufactures, enables product engineers to create a rules base of acceptable behavior for any applications running on the new device.  If an application begins behaving erratically due to malware or some other security threat, NanoDefender terminates the application so that the malware can’t spread across the network or impact the functioning of the device.

It’s clear that the existing “signature-based” model of detecting and eliminating viruses and malware can’t work forever—and it can’t work at all in the device environment.  That’s because there’s just too much bad stuff out there.  With millions of malware signatures required inside any antivirus product today—and 3,000 new viruses and malware signatures being added every hour of every day—there’s just no way an attached device would be able to keep updated or dedicate the processing power needed to screen all traffic against all virus signatures.  By turning the current “virus signature” security model on its head, NanoDefender monitors behavior against a rules base of acceptable actions, and thereby frees up administrators from having to monitor this rapidly-expanding army of viruses, trojans, worms and other malware at all.  It also provides a broader net for catching future Internet-based threats, since it does not rely on specific signature-based fixes.

The “Internet of Things”

The rate at which mobile devices are proliferating is staggering.  In fact, there are predictions that the number of devices on the Internet could reach far into the billions in the next three years.  According to a white paper by Harbor Research, there are approximately 2.8 billion mobile phones in use today, with 1.6 million new ones added daily.  Whether you call this phenomenon “the network of devices” or the “Internet of things,” the underlying message is the same: connectivity permeates our society.  Nearly everything in our day-to-day lives—from TVs and cell phones to cars, medical devices, networking equipment, thermostats, industrial sensors, aircraft and home appliances, and everything in between, connects (or will soon connect) to the network to operate.

Swift consumer adoption is driving mobile market growth but it is also creating increased complexity and security risks.  The Internet is tremendously more complex due to the number and diversity of devices connected to it and the expansion of communication (voice, video and data) that traverse it.  Security is a big concern in our newly connected society.

When it comes to device security, engineers and the manufacturers have the most responsibility and control, and also the most at stake.  Even if the device is connected via carriers, the consumer only sees that his or her device isn’t working and assumes that it is the fault of the device manufacturer.  Devices connected to the network are exposed to viruses that can infiltrate a machine without the user ever knowing it.  Support calls increase, device manufacturers get stuck with the blame and devices get shipped back for trouble shooting.  So while device security is important to get right, deploying security on a device isn’t easy.  Security software and protocols designed for PCs don’t map well down to the constrained memory, low power and mini-processing environment of devices.  Many engineers look first to open source packages, like OpenSSH or OpenSSL.  But those packages just can’t fit into the super-tight device implementations that we’re talking about.  And the performance of these freeware kits is rarely optimized for specific hardware or software environments, either.  This is where Mocana, and our specially optimized offerings including NanoSSH and NanoSSL, can help.

To address the device security challenge and maximize the potential of “the network of devices” everyone—device manufacturers, service providers and enterprises—must assume security responsibility and recognize the need to centralize and standardize how device security is dealt with on all devices, wired and wireless.  We must take a more holistic security approach and apply an extensible framework that secures all aspects of device data access and communications for any connected device.  Securing devices is an industry imperative—and our specialty—and doing it the right way will pay for itself in multiples in our increasingly connected world.

Mocana’s Device Security Framework (www.mocana.com/device-security-framework.html) offers a unified, end-to-end approach to embedded device security management by authenticating devices and device applications to the network; securing communications between devices and resources; and by enabling reliable, secure firmware updates.  Elements of Mocana’s Device Security Framework are characterized by their easy implementation, mix-and-match interoperability, small memory footprint and high scalability and performance.  Applications in the Device Security Framework, which we now brand with a “Nano” prefix, are extremely portable, working across more than 15 operating systems and 50 CPU’s, making it an ideal choice for securing heterogeneous networks of connected devices.

Adrian Turner has more than 15 years of international business experience.  Prior to founding Mocana, Adrian was responsible for west coast business development and Alliances for Kenamea, an enterprise communication firm specializing in reliable, secure communications.  He also had P&L responsibility for developing infrastructure to support Philips Electronics' (NYSE:PHG) connected consumer and business devices.  Mocana was recently named one of RED HERRING’S “Top 100 Privately Held Technology Companies” in North America, and just closed their B-round of venture funding.  They currently have 30 employees and are hiring.  Mocana - www.mocana.com


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