Category: Austin (Page 215 of 318)

By LAURA LOREK
Founder of Silicon Hills News

Every great business starts on the back of a napkin, said Evan Loomis, co-founder of TreeHouse, a sustainable home improvement store.
He sketched out his plans for TreeHouse during a ski trip with some friends in Boulder, Colorado. A few years later he left his investment banking job to launch TreeHouse in South Austin in October of 2011. He also raised $8.5 million from 50 angel investors and capital investment firms to turn that napkin into a reality.
Loomis, now managing partner of Quiver Capital Group, learned a lot in the process. He shared his experiences and advice on Thursday at a Spectrum event put on by the Texas State Small Business Development Center held at Norton Rose Fulbright’s downtown Austin office.
Loomis spoke with a panel of experts on fundraising for entrepreneurs. The other speakers included Michele Skelding, senior vice president global technology and innovation for the Austin Chamber, J. Richard Johnson, a certified business advisor with Texas State’s SBDC, Ann Benolken, a partner with Norton Rose Fulbright, Chris Shonk, managing director of Liahona Ventures and Morgan Flager, partner with Silverton Partners.
Loomis advised entrepreneurs to create a “bad-ass pitch deck.”
“It’s going to be really hard to raise money if you’re not inspiring someone,” he said.
The first time Loomis pitched his company his pitch deck did not impress his audience and neither did his clothes. He pitched his idea to a former Miss Oklahoma, the inventor of the marshmallow canon and the inventor of Musinex. One investor wrote him a $3,000 check and told him to go to Nordstrom to buy some new clothes. They did not invest in his business.
He advised entrepreneurs to get their idea on paper, create a pitch deck and start getting feedback on it.
Loomis also bought a list of the 6,000 richest people in the U.S. complete with addresses and phone numbers. It didn’t help him raise money, though. It’s easy to find high net worth individuals but it’s hard to build a relationship with them.
“Raising money is a little like getting married,” he said. “You don’t ask someone to marry you on the first date.”
The vast majority of companies seeking funding don’t get it, Loomis said.
“I needed to learn how to raise friends, not cash,” he said.
Out of 100 potential investors, 25 would show interest and maybe 10 would invest, Loomis said.
He recalled how he got invited to a billionaire’s house on Park Ave in New York. He wore his new Nordstrom clothes. When he walked into the house, Loomis asked the man about his artwork and if it was from a local artist. The paintings were original Rembrandts. Loomis got nervous and embarrassed. So he dove into his PowerPoint presentation and began to pitch his company. He looked up and noticed the guy wasn’t interested at all. He shut everything down and said to him, why don’t we just talk. The guy said good because I was about to throw you out of my house.
It’s important to know when to ditch the prepared remarks, he said.
Loomis also sent his potential investors hand written notes. With one investor, he sent him a note on his anniversary. The guy was so impressed with his thoughtfulness, he wrote him a $250,000 check.
“Delight them with something unexpected,” Loomis said.
Getting venture capital is tough.
Venture capitalists look for high margin businesses that are growing quickly, said Morgan Flager, partner with Silverton Partners. The company runs two $75 million funds in Austin, which make between 30 to 35 investments each over the fund’s lifetime which lasts from ten to twelve years.
“We have to have outcomes that give us $20 million to $30 million in proceeds,” Flager said. “A lot of people don’t necessarily understand how that economic model works.”
Silverton Partners has made 25 investments in Austin ranging from two guys and a dog to a $75 million company, Flager said. He advised companies to go as long as possible before raising venture funding.
Benolken with Norton Rose Fulbright also advised startups to get their records in order before seeking financing.
“Get dressed for the party before you go,” Benolken said. “Don’t go with one shoe on.”
If a company doesn’t have written contracts and other records then it could kill a deal, she said. She also advised startups to review any offers with a lawyer before signing if they claim to be non-binding. Even emails with employees promising equity can be binding, she said.

By LAURA LOREK
Founder of Silicon Hills News

At 4:30 a.m., George Kozmetsky began his 18-hour days taking meetings in his office at the University of Texas at Austin.
Entrepreneurs like Michael Dell, who was just starting a PC company, or James Truchard, co-founder of National Instruments, might drop by for a breakfast of orange juice and cornflakes.
Kozmetsky kept a white board by his desk and he was known to sketch out problems and solutions for his visitors.
His door was open for everyone from students to heads of state, said Pike Powers, a lawyer, former state legislator, economic developer and close friend and collaborator of Kozmetsky.
“George was the godfather of high technology for the region,” said Laura Kilcrease, managing director of Triton Ventures and also a close friend and the founding director of the Austin Technology Incubator. “The godfathers are untouchable. They’ve got a track record of getting things done and getting them done right. George was old enough and wise enough and generous enough to think about what was best for the greater good of the community.”
Kozmetsky came to Austin in 1966 after he successfully co-founded Teledyne, a computer electronics company in Silicon Valley. He served for 16 years as the UT dean of business. He believed strongly in collaboration among government agencies, educational institutions and entrepreneurs. He launched the IC2 Institute in 1977 and the Austin Technology Incubator in 1989. President Clinton awarded Kozmetsky the National Medal of Technology in 1993. Kozmetsky worked tirelessly to promote Austin’s technology industry until his death in 2003 at the age of 85.
His son, Greg Kozmetsky would often prepare the coffee and juice for his dad’s early morning meetings.
“Dad had a philosophy that you don’t need sleep,” Greg said. “You just need to rest.”
Kozmetsky would take 20 minute to 30 minute rest breaks throughout the day.
“He would wake up at 3 a.m. and start thinking about things,” Greg said. “By 4 a.m. he was headed to the office.”
When he got older and he could no longer drive, his assistants, Pattie Roe and Ophelia Mallare, would drive him.
His wife, Ronya, also actively supported her husband. They even taught a class together at UT on marriage and entrepreneurship. She wrote a book “Making It Together: A Survival Manual for the Executive Family.” Ronya, who died in 2011 at the age of 90, was a licensed pilot and she ran the RGK Foundation.
Greg, also a pilot, would fly his dad around the country and world.
“I knew he was different,” Greg said. “I didn’t know how different he was.”
When Greg was a kid his dad would gather his children and the neighborhood kids together and sketch out ideas for them on a whiteboard in their house. He thought if he could explain his ideas so that kids could understand them then others would too, Greg said.
“He was first and foremost an academic,” Greg said.

Kozmetsky, born in Seattle to Russian immigrant parents, grew up poor and even worked at the fish docks as a kid. He understood the value of an education. He earned his bachelor’s degree from the University of Washington at the age of 20. He then served in the Army Medical Corp. in World War II. When he returned, he earned his MBA and doctorate degrees from Harvard University. And he went on to found Teledyne, a conglomerate of companies which made everything from airline parts to batteries and precision instruments.
This year, Kozmetsky’s brainchild, ATI, turns 25 years old. It is one of the oldest continuously running incubators in the country.
ATI has graduated 142 companies, which have created thousands of jobs and had an economic impact of more than $1 billion on Central Texas’ economy.
Yet many people who make up the bustling technology ecosystem in Austin today don’t know the critical and crucial role Kozmetsky played in its vision and development.
“George was such a compassionate, thoughtful and intellectual leader,” Powers said. “He didn’t want to be adulated and praised. He wanted to do things that made a difference. And he did.”
When ATI launched in 1989, Austin was in dire straits economically.
The city had one of the highest commercial real estate vacancy rates in the country as a result of the Savings and Loan crisis.
Austin had a skyline of so-called “see-through buildings,” because they were just shells built during the real estate boom that hadn’t been finished out, Kilcrease said.
Banks foreclosed on about 1,000 homes every month.
Austin needed ATI to jump-start its economy, Kilcrease said.
Kozmetsky recruited Kilcrease to run ATI. Kilcrease had been in town running a high tech company. She did a fair amount of community service.
“One day, out of the blue, George called me,” Kilcrease said.
His wife, Ronya, gave a taped session of a women’s management group in which Kilcrease had spoken, to her husband.

“He said my name is George Kozmetsky and I have an idea and I’d like to talk to you about it,” Kilcrease said. “Initially George asked me would I volunteer, which I did for quite some time.”
In 1980, only 12 incubators existed, according to the National Incubator Board. By the time ATI launched that number grew to 40. Today, there are more than 1,300.
Without an incubator like ATI, Kilcrease thought she might not be living in Austin for long. Austin’s economy depended on the government and the university. It needed to diversify.
Austin’s technology makeover began when the city landed the Microelectronics and Computer Technology Corporation (MCC) in 1983, followed by SEMATECH in 1987. Both ventures involved government, university and business collaboration, which set the tone for ATI. It received support from the chamber and business leaders, Powers said.
Its goal was to nurture high tech startups with high growth potential, Powers said.
“We needed to build our own future and create our own well-being,” Kilcrease said.
“It wasn’t a job. It was a mission.”
After launching ATI, Kozmetsky then launched the Capital Network, the first angel network in Austin, which ran from 1989 until 2004 and was the forerunner of the Central Texas Angel Network.
In addition, Kozmetsky created the Austin Software Council, which is now known as the Austin Technology Council. The networking organization allowed tech entrepreneurs to collaborate with each other.
“People would look at ATI like it was the one thing – in fact it wasn’t – it was the start of a much bigger, dynamic goal and plan of what we wanted to put together,” Kilcrease said.
The cornerstone institutions that support technology entrepreneurship in Central Texas today are all the products of Kozmetsky’s vision, said Isaac Barchas, director of ATI.
The impact of ATI stretched way beyond Texas, said David Gibson, associate director and senior research scientist of the IC2 Institute. He worked with Kozmetsky for 20 years.
He traveled with Kozmetsky to Russia, China, Taiwan, Korea, Brazil, and other places.
“We trained the first incubator director for Shanghai in the early 1990s and the first director of an incubator in Moscow,” Gibson said.
Kozmetsky helped to found the Cross Border Institute for Regional Development at the University of Texas at Brownsville to encourage collaboration between the U.S. and Mexican entrepreneurs.
“George, even in his 80s, was a visionary,” Gibson said. “He saw things way out there.”
He understood the importance of collaboration and how communities work together to become stronger.
“Austin did collaboration better than most cities and still does and that’s why it’s been so successful,” Gibson said.
He had the vision for the Austin “technopolis” in 1986 and he set that vision in place, Gibson said.
But when ATI launched, people were skeptical.
“I remember very vividly they looked at me with my accent and they thought incubators involved chicken and eggs,” said Kilcrease, who is originally from England. It was tough at first to convey the concept, she said.
Austin had an incubator before ATI that went out of business after three years and burned through $8 million or $9 million and had no surviving businesses, she said.
ATI launched with a budget of $125,000 for the first and second year and by the end of the third year, ATI had turned a profit, Kilcrease said.
Kilcrease and Kozmetsky promised that ATI would create 200 jobs in three years from new companies.
And within 10 years, these new technology companies would occupy all of the vacant square footage in Austin.
They exceeded those goals.
“A big audacious goal we had was not just to incubate companies,” Kilcrease said. “It was to diversify the economy and create an ecosystem that could work on its own and ATI was going to be the catalyst to make that happen…. You fast forward and you look at Austin now that dream was fulfilled in about 12 years.”
By the end of the 1990s, Austin became one of the major tech centers in the country.
“At the time, it was very pioneering groundwork,” Kilcrease said. “George was always very much a future thinker.’’
He had a brilliant mind and a 50-year vision plan for Austin, Kilcrease said.
His vision is still being realized today, said Barchas, director of ATI.
”The Austin we are living in, we are living in because of George Kozmetsky. He sacrificed to do it,” Barchas said. “He showed us that if we are smart and dedicated, and if we are willing to bring others into the process and give them credit, we can change the world, and we can change Austin. It wasn’t George bullying his vision through other people. He was able to form enduring alliances that meant his visions would last beyond him.”
And they did.

Athenahealth announced plans to put a research and development center in Austin with plans to create 600 new jobs.
The company, founded in 1997, provides cloud-based health information services for electronic medical records and other medical documents.
It plans to occupy 110,000 square feet of the Seaholm Power Plant redevelopment project in downtown Austin and invest $13 million.
During the next 10 years, the company plans to hire 607 employees in addition to its current workforce of 36 employees in Austin.
“We are thrilled that athenahealth has chosen to expand their operations here in Austin,” Pete Winstead, Shareholder at Winstead PC and Chairman of Opportunity Austin, said in a news release. “The region’s competitive cost environment, coupled with its position as a center of technological innovation will provide the Company with continued growth opportunities, particularly as we look to the future and the opening of the Dell Medical School and innovation district.”
Opportunity Austin is the Austin Chamber of Commerce’s economic development initiative.
The City of Austin approved a 10-year incentive package worth $679,000. The State of Texas also gave the company a $5 million Texas Enterprise Fund grant.
“We’re thrilled to be growing our presence in Austin, a City with a culture and vibe that perfectly aligns with our own,” Jonathan Bush, chairman and CEO of athenahealth said in a news statement. “athenahealth is growing all across the country as we work to fulfill our vision of becoming a national information backbone to make health care work as it should. Austin’s dynamic talent pool, combined with the fantastic support from Governor Rick Perry and his team, as well as from the City of Austin, has made us already feel at home. We’re inspired to make Austin a hub for the important work we do to advance connectivity in health care.”

The Austin Technology Incubator celebrates its 25 anniversary and plans to graduate its latest crop of 25 companies during an event Wednesday night at the AT&T Executive Education and Conference Center.
The ATI, part of IC2 Institute at the University of Texas, will also announce the winners of the Laura J. Kilcrease Civic Entrepreneurship Award and the new John S. Butler Distinguished Alumni Award.
George Kozmetsky founded ATI in 1989 and Kilcrease served as its first director. The incubator has graduated 150 companies, which have created 5,500 jobs and have had nearly $1 billion economic impact on the central Texas economy.
ATI’s latest class have raised more than $60 million in capital. The companies are (descriptions provided by ATI):

Amatra: emergency notification program management tools for federal, local, municipal governments and corporate campuses.

Aunt Bertha: enterprise platform for the social services sector.

BeHome247: remote premises management and monitoring systems.

Black Locus: automated and optimized pricing tools for mid-market and large online retailers.

Datical: database schema automation software for IT Systems Management.

Decision Grid: big data analytics targeting military and security markets.

Evocalize: (formerly Dish Opinion) enables businesses to collect consumer feedback with intelligence to increase customer acquisition, retention and satisfaction.

Favor: offers anything you want from your favorite restaurants and stores. Delivered.

FlowBelow: aerodynamic products designed for 18-wheel tractor trailer trucks for increased fuel savings.

Hoot.me: Facebook application that makes it easy for students to collaborate with classmates, teachers and tutors online, targeting the MOOC and tutoring markets.

Ideation Systems: dedicated to the promotion of learning and advancement of science through accessible and affordable technology.

Ihiji: cloud based Network Management as a Service (NMaaS) platform for remote monitoring and maintenance of IP-enabled devices.

Izpitec: develops non-intrusive plasma measurement technology for use in semiconductor manufacturing.

Limelite Technologies: commercial and consumer electroluminescent lighting products.

Loop & Tie: makes it easy to send unique, handpicked gifts to large groups.

M87: delivers the full potential of machine to machine connectivity in the mobile age by moving network routing to the edge.

Nuve M2M: device management platform, initially targeting transportation market. First applications are fuel theft reduction, cement theft and cargo theft.

Omni Water Solutions: specializes in developing and deploying mobile water treatment platforms for reuse initially focusing on the large hydrofracturing market.

Ordoro: shipping and inventory management for e-commerce.

SalesVu: full suite mobile payment platform offering POS-integration, subscription billing, invoicing, e-commerce solutions and report analytics.

Set.fm: iTunes for Live music. Enabling real time commerce and sharing of high quality concert audio.

Terra Pave International: ozone-friendly asphalt substitute for roadways.

Toopher: Invisible Multifactor Authentication prevents online fraud and identity theft by using the location awareness of your phone.

Xeris Pharmaceuticals: drug stabilization platform. First application: diabetes.

Yan Engines: novel D-cycle engine retrofit which improves fuel efficiency by 60%, increases torque by over 200%, and reduces emissions.

Next week, the Silicon Hills will meet the Silicon Valley.
A group from the University of Texas at Austin’s Cockrell School of Engineering will showcase some of its best and brightest startups to Silicon Valley investors, entrepreneurs and press at an event dubbed UTinSV.
“Silicon Valley holds the highest concentration of UT engineering graduates outside of Texas,” with 2,197 alumni located there, according to a news release. “Ninety two companies have offices in both Austin and Silicon Valley. The top five employers of UT engineers include Intel, Chevron, Applied Materials, AMD and Cisco.”
It’s the second annual event. Last March, the UT engineering school hosted the first UTinSV event at AMD headquarters in Sunnyvale, Calif.
This year, nine UT technology-based startups will attend including Lynx Labs, maker of wireless 3D cameras, RideScout, a commuting and car share application and M87, a platform that boosts smartphone connection speed.
The event kicks off Thursday afternoon at the Sharon Heights Golf and Country Club in Menlo Park. Bob Metcalfe, UT’s Professor of Innovation and Ethernet inventor is one of the featured speakers. Greg Horowitt, T2 Venture Capital Co-Founder and Managing Director, is also a featured speaker. The event is moderated by Bill Gurley, Benchmark Capital’s general partner.

In recent years, a number of tech companies have expanded to Austin.
Among them, Tableau Software Inc. set up shop in September of 2012 and expanded its offices to Congress Avenue six months ago. The company has grown rapidly in Austin, said Elissa Fink, its chief marketing officer.
She was in town recently for an open house Tableau held at The Belmont featuring a speech by its CEO and Co-founder Christian Chabot, 42.
The Seattle-based company, founded in 2003, had one of the biggest tech initial public offerings in 2013. It went public on the Nasdaq stock market last May with an initial stock price offering of $31 a share and raised $254.2 million. The company’s stock closed at $50.75, up 64 percent on its first day. Tableau sells data analytics and visualization software. Its stock closed at $75.60 on Tuesday.
And the company, with 1,039 employees, is expanding in Austin, Fink said. But the company doesn’t provide figures on how many Austin employees it has or how many it expects to hire this year, she said.
The company’s customers range from Fortune 500 companies like eBay and Target to startups like Tesla. It also sells to solo-entrepreneurs, game designers, scientists and high school principals.
Its Austin-based customers include the University of Texas at Austin, Zilliant, SolarWinds, Michael & Susan Dell Foundation, Texas Department of State Health Services, Freescale Semiconductor and Wargaming America.
“We love the energy, we love the talent pool and we love the attitude of Austin,” Fink said. “It has all the qualities we espouse in our brand.”
Tableau is looking to hire great sales people, technical and support people, engineers and software developers as well as marketing and operations employees, Fink said.
“Our mission is to help people see and understand their data,” Fink said. “Tableau builds software that makes it really easy for people to access a database through visualizations.”

Codero Hosting, a provider of web-based hosting services, announced Tuesday it has received $8 million in financing from Silicon Valley Bank and Farnam Street Financial.
The company plans to use the money to set up data centers throughout the U.S. and Europe to serve more customers from multiple locations.
“We have outpaced our industry’s growth, expanding faster than other hosting and cloud providers due to our commitment to providing customers with unparalleled performance, expertise, support and value,” Emil Sayegh, president and CEO of Codero Hosting, said in a news release. “The support of SVB and Farnam Street Financial helps us accelerate our growth and capitalize on our market success.”
Codero is based in Kansas and opened an office in Austin in 2012.

By KEITH CASEY
Special Contributor to Silicon Hills News

Before I go any further, let me state that I loved working for Twilio. It’s cool technology but more importantly the passion, intelligence, and the ability of the senior leadership and just about everyone else is amazing. I walked in and felt like everything we did sharpened my skills and abilities every step of the way.
I write this post for a couple reasons.. First, I’ve been out of Twilio for a couple months, so I’ve finally organized my thoughts. Second, and more importantly, a number of people have asked me about becoming an evangelist and what the job is like.
First, what does a Developer Evangelist do?
This will vary from company to company and even as the company grows and matures, but here’s what I did:
Attended hackathons, gave demos, and helped people solve problems, Twilio-related or not.. an average of 1-2 hackathons/month for 2.5 years;
Update: It’s also worth noting that I co-organized 25-30% of those hackathons;
Spoke at an average of 15 conferences per year, usually a 1 hour presentation, sometimes a 3 hour workshop;
Wrote blog posts ranging from technical coverage of clever applications and good API usage to event writeups;
For my first year, I ran customer support every Tuesday, then one weekend day/month, then not at all once the Support team grew;
Acted as a sherpa to help customers navigate the organization to find the right person to talk to for whatever;
Kept an eye out for good employee candidates, made recommendations where appropriate;
Tested and reviewed projects, tools, and concepts coming out of the Product team;
Introduced and promoted partners when their products/services fit the needs of other partners & customers;
Introduced customers to Sales, helped Sales by visiting customers and helping them get started;
Made myself available at random coffee shops both in Austin and during travels;
Served as the point of contact for numerous community organizations and (inadvertently) a number of F500 customers;
Traveled 140 days during 2011;
Traveled 120 days during 2012;
Traveled 115 days during 2013 (but over 9 months, instead of 12).
Next, let me cover the high points of Developer Evangelism..

The job is like nothing else. In fact, in the right company, it will be exactly what you make it. At Twilio, we reported through Marketing but we interacted with Support, Sales, Product, Recruiting, and just about every other group in the organization. My personal passion was helping people get started, figure out where Twilio made sense for them, and getting their first project online. But on any given day, if I was tired of doing X, there was plenty of Y and Z to do also. Unfortunately, at other companies, the evangelists may report through Sales which likely means quotas. Or through Product which means installs or downloads are probable goals. Regardless, measurement is good, but it has to be the right measurements and things you can actually influence.
The opportunity is like nothing else. Finding smart people doing cool things was my job. I got to meet, hang out with, help, and work with some of the best and brightest across North America. There are people literally saving lives with Twilio and that’s only the tip of the iceberg. When you can go to sleep at night knowing the world is changing in a positive way due to your work.. amazing.
The community is like nothing else. I don’t just mean the individual tech communities as those are awesome too. I mean the growing network of evangelists. No one gets the job without being smart, passionate, friendly, and being well-connected. When you get to hang out with this crew, you learn about some of the best and brightest out there and get to play with the best technology, concepts, etc.

Now, let’s cover the dark side..

First, the job is prone to burnout. I was the first evangelist to make it past the 12 month mark and I’d wager I really only made it to 18 months before burnout started to set in and 24 months before it fully reared its ugly head. Now before you think Twilio is exceptional in that way, know that it’s a common situation across many companies. I know of one company where evangelists consistently leave at 18 months.
Next, the job wreaks havoc on your personal life. If you’re single with no kids, no pets, no mortgage, no blah, blah, blah, the flexibility is awesome. You can be in a different city every single weekend and never come to your “home” city. I know of at least two evangelists who gave up their apartments for just that reason. But if you do have any of those personal commitments, it’s another story.. being in a different city every weekend can be a curse. You always have to make arrangements, make apologies, and figure out how to juggle.
The killer for me was when TripIt started reminding me of upcoming “visits” to Austin between actual trips.. for the record, I live there.
Finally, you are never off the clock. This is the big one.. and I can think of one friend and colleague who was nearly destroyed by it. When you’re at an event, you’re representing the company. When you’re speaking, you’re representing the company. When you tweet, you’re representing the company. Everything you write, say, do, or whatever represents the company. You can use those “doesn’t represent the views” lines all you want but they don’t mean anything.
Think about that.. from the time you wake up until you go to sleep, you’re on the clock.
So there it is. That’s the full story on Developer Evangelism. If you can do it for the right company and team, it is one of the best jobs you can ever have. At the same time, it’s challenging, exhausting, and ripe for getting yourself in trouble.

If you have any specific questions, feel free to drop me a note: Keith Casey

Editor’s Note: This post originally appeared on Keith Casey’s personal blog. It is reprinted here with permission.