Category: Austin (Page 99 of 317)

Next Coast Ventures announced Wednesday that it is has added two technology venture partners and its first entrepreneur in residence.

The Austin-based venture capital firm has added Paul Rogers and Jim Dunham as Technology Venture Partners, which will serve as mentors to the firm’s tech entrepreneurs in its portfolio and advisers to the fund’s leadership.

Next Coast has also hired Adam Salamon as its first Entrepreneur in Residence.

“All of them have been working with us,” said Mike Smerklo, co-founder and managing director of Next Coast Ventures.

The addition of the team members helps Next Coast Ventures attract and support the best entrepreneurs, he said.

The additional staff speaks to Next Coast Ventures’ mantra of “built by entrepreneurs for entrepreneurs,” Smerklo said. It is a firm focused on company building, he said.

“I always wished there were resources like this when I was an entrepreneur,” he said.

Dunham, with more than 25 years experience, recently served as president of cloud and business intelligence at ServiceSource, a San Francisco-based software company.

Rogers has worked at Google and currently serves as chief technology officer of New York-based Namely Inc., a human resources data platform. He also formerly served as chief technology officer at Austin-based RetailMeNot and vice president of engineering and operation at Austin-based Bazaarvoice.

Salamon most recently served as founder and chief operating officer of Perk Inc., a rewards and engagement platform that went public on the Toronto Stock Exchange. RhythmOne PLC acquired Perk earlier this year.

“Adam is a great entrepreneur,” Smerklo said. Venture capital firms often bring on seasoned entrepreneurs in the entrepreneur in residence role to help evaluate deals and assist current entrepreneurs in its portfolio. The timing was right because Salamon recently sold his company and he was in the process of figuring out what to do next, Smerklo said.

Next Coast Ventures now has five employees and it recently moved into its new headquarters, an old house which the firm remodeled at 12th and Nueces.

In March of this year, Zeynep Young, an Austin entrepreneur, and former foundation director joined as a venture capital partner. That same month, Next Coast Ventures closed on its $85 million fund.

Next Coast Ventures has invested in nine companies so far including Scale Factor, LeanDNA, Umuse, Dropoff, OnRamp, and PHLUR. Its other investments include Clarity Money, based in New York, Cloverpop, based in San Francisco and Brava, based in Redwood City, Calif.

BY LAURA LOREK
Publisher with Silicon Hills News

From the outside, 500 W. 2nd street might look like any new skyscraper in downtown Austin.

But inside, it’s got that Google flair with scooters in the lobby, a swing, balance boards, a ceiling made of recycled canoes, an Airstream trailer food truck, outdoor movie theater, dog park, grassy areas, floor to ceiling library with bar and piano and beautiful expansive views of downtown Austin and Lady Bird Lake.

Google, with 450 employees, leased 300,000 square feet in the new building on ten floors. It is already occupying five floors and plans to move into the others in coming months.

“It’s the perfect combination of Austin weird and Google Playfulness,” said Kristin Chiles, Google real estate executive.

The floors have Austin themed rooms and event centers like the 25th floor with Barton Springs fitness, Hamilton Pool micro kitchen, McKinney Falls wellness center and Shoal Creek training.

The 29th floor is home to the SXSW Tech Talk room, which is fashioned after a conference area in Google’s Mountain View headquarters. It’s an inviting space that Google plans to host community events in, said Gerardo Interiano, Google’s Austin community manager. The Mott coffee bar is also on the floor along with the Magnolia room, and Pecan & Pine Patios. An expansive staircase connects the different floors.

The 28th floor is home to the Bat Cave, Bridge Café, East Austin Dining Room and the Zilker Park Terrace. That’s where the Airstream trailer is located that Google had lifted with high-powered cranes to get it in the building. Google provides its employees with free hot meals, snacks, and drinks.

This year marks Google’s 10th anniversary in Austin. It bought Postini, an email security and archiving company, in 2007.

“We love Austin, its world-class talent, and world-class companies,” said Greg Garrison, Google Austin Site Lead. “Google is proud to call this city home and we’re excited to continue to contribute to the amazing community and help define Austin as a growing tech hub.”

Google hosted an event Tuesday morning to unveil its new office and to announce a $250,000 grant to Workforce Solutions in support of the Master Community Workforce Plan.

Google has helped bring high-speed Internet access to Austin and spurred a lot of competition in delivery high-speed Internet to consumers and business, said Mayor Steve Adler. It also helped connect poor communities in the city to the Internet, he said.

The grant will help train people to get better jobs, Adler said.

“We have, in this city, 40,000 people that are looking for work and 40,000 jobs but the people that are here are not trained to take many of those jobs,” he said.

Companies are forced to bring in people from outside the city to fill those jobs, Adler said. During the next five years, the city will have about 65,000 middle-skilled jobs that don’t require a four-year degree, Adler said. They might require a two-year degree or certification, he said. Austin’s goal is to move 10,000 people out of poverty and into a middle-skilled job in the next five years, Adler said.

“That is a goal we can achieve,” he said.

The grant from Google will help make that goal a reality, Adler said.

Since 2011, Google has awarded more than $3.7 million in grants to Texas nonprofit organizations to concentrate on science and technology education, carbon reduction and access to the Internet.

 

The Zebra, an insurance comparison marketplace, announced Tuesday that is has closed on $40 million in financing and hired Former Kayak Executive Keith Melnick as its new Chief Executive officer.

The Austin-based startup reported Accel Partners led the Series B financing round, the largest Texas Series B financing this year.

Melnick, former president of travel metasearch engine KAYAK, is taking over the reins of CEO from Founder Adam Lyons, who will become the company’s Chairman.

“From day one we set out to make insurance ‘black and white,’ and our team is making a huge impact in driving this industry forward,” Lyons said in a news release. “There is no shortage of interest in the insurance space right now, and we felt Accel was the right partner and aligned with our vision of creating something big. When we met Keith, we knew instantly that we found the talent to help take this company to new heights.”

To date, The Zebra, founded in 2012, has raised $61.5 million including the Series B round.

“There’s an opportunity in insurance to build the go-to digital brand for comparison shopping, just as we’ve lived through from the beginning with what KAYAK did for travel,” John Locke, a Partner with Accel, said in a news release. “The Zebra team has the product-first DNA and momentum to pull this off, and we’re thrilled to partner with Keith Melnick – who we worked with on KAYAK for over a decade – and the whole The Zebra team to help make this vision a reality.”

The Zebra provides consumers with quotes from more than 200 auto insurance companies in seconds. It has partnered with most of the top 25 insurance companies. The company plans to use the funding to expand its product’s functions, add new lines of insurance, hire more employees and expand its partnerships. It will also focus on branding and marketing.

“Insurtech is exploding, bringing concepts like peer-to-peer insurance and pay-per-mile models in front of consumers,” The Zebra Co-founder and COO Joshua Dziabiak said in a news release. “Our role is to serve as the online marketplace where these innovations are made available to consumers. The vision is for consumers to be able to learn about, search and compare their options, and then purchase and manage their insurance coverage – all in one place.”

Melnick most recently served as President of KAYAK, and was on the team that launched the company in 2004. He previously worked as a management consultant with the Boston Consulting Group, concentrating on travel, e-commerce, and financial services, and he helped create Orbitz, Inc.

“The insurance industry is where the travel industry was 10 years ago. While the industries vary in players, complexity, and structure, it’s clear to me that the time is ripe to create a similar sort of easy-to-use, yet powerful, consumer experience for both those shopping for and those providing insurance,” Melnick said in a news release. “It sounds simple, but it definitely is not, and it can revolutionize the industry. The Zebra gets that, I get that, and we share a vision and a plan to get it done.”

The Zebra’s investors also include Silverton Partners, Floodgate, Ballast Point Ventures, Mark Cuban, Daher Capital, and Birchmere Labs.

By LAURA LOREK
Publisher of Silicon Hills News

Sputnik ATX is one of Austin’s newest startup incubators and accelerators.

“We’re in a bit of a stealth mode right now,” said Oksana Malysheva, President, and CEO of Linden Education Partners and CEO of Sputnik ATX.

Sputnik ATX, which fashions itself after a Y-Combinator incubation model, will begin accepting applications for its first class in October, Malysheva said. It should have details for the criteria of what it’s looking for in startups on its website shortly, she said.

Sputnik ATX is not related to the Sputnik news agency in Russia. Its name stems from Sputnik 1, the first Earth satellite launched into orbit in 1957 by the former Soviet Union that launched the space race. Malysheva earned her B.S. and M.S. in Physics from the Moscow Institute of Technology. She went on to earn her Ph.D. from the University of Pennsylvania. She has worked as an executive with Motorola and McKinsey & Co.

Josef Merrill, chief financial officer of Linden Education Partners who will also be involved with Sputnik ATX, received his B.A. from the University of California at Davis and his MBA from the University of Chicago. He is a former U.S. diplomat.

“Sputnik is about connecting world-class entrepreneurs to investors who will propel them to success,” Malysheva said.

The Sputnik ATX incubator and accelerator will last 100 days. The first class will begin in January. Sputnik plans to host three classes a year.

Initially, Sputnik will be based in office space on the 22nd floor of the 301 Congress building downtown. It’s space the incubator has subleased from Teza, a hedge fund that occupies the entire floor. Chicago-based Teza opened an Austin office in 2015. Teza is headed up by its CEO and founder Mikhail “Misha” Malyshev, who is also the husband of Oksana Malysheva.

“It’s a nice space and Teza is a very innovative company and they have supported us nicely,” Malysheva said.

The incubator will provide office space, mentorship, coaching, training, and funding. Linden Education Partners’ first investments have been in education technology and financial technology. It will accept five to ten companies in its first class. The companies can apply from anywhere but they must be based in Austin for the duration of the incubator class, Malysheva said.

Linden Education Partners has already invested in Declara, based in Palo Alto, Calif. a social learning platform run by Ramona Pierson. It has also invested in financial technology startups: Kapitall and SaveDay.

The companies accepted into the Sputnik incubator will receive $100,000 investment in exchange for an equity stake in their company, Malysheva said. The incubator will also help them to raise additional funds to scale their businesses.

Sputnik’s investors come from a family fund and individual investors, Malysheva said.

“Most of the businesses we have made an investment in have focused on elevating the human being to their highest potential,” Malysheva said. “It has to be good economics. We have to believe at the time of investment that it is the right business for us to be in. But part of what we do also is, it’s not my term, but Goosebumps business.”

“That means something about the business you’re in has to make this world a better world,” she said.

They are also looking at investing in startups where the founder is the builder, Malysheva said. The founder is integral to the product, she said. The founder cannot outsource the production of the software or product, she said.

Sputnik chose to locate in Austin for the city’s entrepreneurial culture, and its technology talent, Malysheva said. And the quality of life here is nice, she said.

“Entrepreneurship is a very lonely endeavor,” Malysheva said.

The key is it’s a marathon, Malysheva said. The Sputnik incubator provides a network of people who are all launching companies at the same time and can draw strength, encouragement, and advice from one another, she said.

“I’m hoping to build that network of co-conspirators from the very beginning,” she said.

Ideas are nothing unless an entrepreneur can take them over the finish line, Malysheva said. Entrepreneurs need to find ways to seek strength, rejuvenate and not burn out, she said. It’s not taught enough in the entrepreneurial community, she said.

Already, Austin has the Austin Technology Incubator, one of the oldest continuously operating incubators in the country, Capital Factory with its technology accelerator, Tarmac Texas at Galvanize, Techstars, TechRanch and SKU Accelerator, among others.

But Malysheva thinks there is room for more.

“So far people have been very welcoming to us,” Malysheva said. “It feels more like cooperation than competition. I think that the more companies that invest here the bigger it gets.”

By LAURA LOREK
Publisher of Silicon Hills News

It’s going to take the mass consumer market years to catch up to all the innovation in the augmented reality and virtual reality marketplace, according to a panel of experts at the University of Texas at Austin on Thursday.

One of the challenges for virtual reality and augmented reality is convincing the consumer to put something on their face and cover their eyes, said Eric Feng, a partner at Kleiner Perkins Caufield & Byers, a venture capital firm.

“It’s still many, many, many years out before we’ll have true consumer adoption of this technology, Feng said.

Feng spoke on a panel on the Future of Infotainment at the Disruptive Technologies Conference at the University of Texas at Austin on Thursday.

Feng’s firm has invested in Magic Leap, a Plantation, Florida-based privately held company with a research and development center in Austin, which is one of the leaders in the augmented reality space. The highly secretive company, which has raised more than $1 billion in venture capital, is creating a wearable device aimed at consumers that include goggles or some kind of glasses.

The product is not available yet, but it is spectacular, Feng said.

Next week, Apple is updating its software to increase its Augmented Reality technology and that should encourage more people to use it, according to the panelists.

Augmented Reality, like the popular Pokemon Go game, superimposes information, like a Pokemon character, into a real world view. Whereas virtual reality completely immerses a person into a digital world. Google also has experimented with Augmented Reality with its Google Glasses.

Apple this summer released an ARKit to let developers build AR applications for iPhone and iPads, according to Bloomberg. Apple’s new operating system set to be released next week is expected to have even more AR capabilities to more than one billion devices.

The industry is also being held up by the cost of high powered computers to run virtual reality applications and the lack of content said Jan Goetgeluk, founder, and CEO of Virtuix. The company is based at Capital Factory and makes a virtual reality motion platform for moving freely and naturally in video games and virtual worlds.

Bob Metcalfe, professor of innovation at UT Austin and inventor of Ethernet, moderated the panel and asked the panelists what the killer application is for virtual reality?

Magic Leap could be the application that is good enough for consumers to overcome their apprehension about putting on an augmented or virtual reality headset, Goetgeluk said.

The killer app is education, said Jay Banerjee, Chief Operating Officer for ImmersiveTouch, a company that makes a virtual reality system that combines 360-degree video and 3D interactive content to teach surgical techniques to physicians inside a digital environment.

Goldman Sachs Research expects virtual and augmented reality to become an $80 billion market by 2025, roughly the size of the desktop PC market today, according to a recent report by Heather Bellini. She also sees it transforming industries like real estate, healthcare, and education.

By LAURA LOREK
Publisher of Silicon Hills News

A huge gap exists between what colleges are teaching students and what a company like Apple needs, an Apple executive said Thursday.

“I don’t consider myself an expert on education technique, what makes great curriculum or any of that. I’m sort of like a big user of the alphabet,” said Bob Mansfield, senior vice president of technologies at Apple. He graduated from the University of Texas in 1982 with a degree in electrical engineering and spent the last half of his career at Apple.

The gap exists with recent college graduates entering the workforce and not prepared for real life applications of their skills in companies.

“Maybe there is something illustrated in that gap that we need to work on fixing,” Mansfield said.

He spoke on a Future of Education panel Thursday at the University of Texas at Austin’s Disruptive Technologies Conference. About two hundred people attended the conference, held in the new Engineering and Education Research Center at the UT campus. The day-long conference tackled a variety of subjects from autonomous vehicles to applied machine learning and the future of infotainment.

The skills gap for new graduates is an issue UT educators hear all the time and that the way professors teach their students doesn’t necessarily prepare them for the real world, said Jonathan Valvano, professor in the Department of Electrical and Computer Engineering at UT.

To an extent, UT needs to provide a structured program and classes for students because they don’t know what they want or need, Valvano said. But UT can do better by breaking down the walls between departments, he said.

“We all have our own curriculum and we’re not allowed to intervene with the mechanical engineers,” he said.

UT Austin is consistently ranked as one of the top ten engineering schools in the country. The quality of the UT Electrical and Computer Engineering students is unbelievable, said Jamie Pennebaker, UT Austin, Department of Psychology. The average SAT score is 1360 and the students enter UT with an average of 30 hours of AP credit, the equivalent of an entire college academic year worth of credit hours.

“They are prepared in a way that students have never been,” he said

The students are extremely technologically savvy and that raises some fundamental questions about how do we teach our kids, Pennebaker said.

The caliber of student at UT is a lot better, they come in more prepared, Mansfield said. And UT can build a machine to crank out really good journeymen engineers that can solve a particular problem but they need to be able to work collaboratively with others in other disciplines to solve problems collectively, Mansfield said. The curriculum background a new employee has at Apple doesn’t define them, he said.

To create engineers prepared for industry, universities need to expose students to the world outside of the classroom to a much higher degree earlier, Mansfield said.

The creative process at a technology company involves liberal arts, human behavior and a wide variety of interests, Mansfield said. Booksmarts alone will not cut it in the corporate world, he said.

“I can work work with the world’s smartest people but I’m no where close to one of them,” Mansfield said. “So I do think there’s a sort of set of certain human behaviors and things like that, that schools have to do more of because if they don’t people are going to come into our company, for example, and struggle for a long time until they learn what makes that work. And it isn’t about their competitiveness with their neighbor or they got the right answer so many years in a row that they don’t know what happens when they don’t get the right answer one time. And they learn how to take risks in spite of the fact that a lot of engineering is about taking all the risk out of everything. I think those are human qualities that have nothing to do with being book smart in engineering.”

In addition, UT needs to start thinking of its students as lifelong learners and provide opportunities for them beyond their degrees, said Nina Huntemann, director of academics and research at edX.

“UT Austin don’t think about the students as just being your students for four years, think about them as being your students forever,” Huntemann said.

Provide them with opportunities, using online tools, to continue to train them so they can stay on top of what industry needs, she said.

“Breaking out of, frankly, degree programs that are defined by x number of credits and x number of years,” she said. “It should be continuous, constant, how can UT and the engineering schools rethink the delivery of education throughout someone’s career.”

The Austin-based on-demand delivery service, Favor, announced Thursday that it has reached profitability and raised $22 million in venture funding.

S3 Ventures led the Series B financing round, which included existing investors.

“Scaling a high-touch, hyper-local logistics business is no easy task, and all the credit goes to our team’s relentless focus executing on our strategic growth plan,” Jag Bath, Favor CEO said in a news release. “Achieving profitability at this scale, and the vote of confidence from our existing investors, is validation of what we are doing and underscores the future of the on-demand economy.”

Favor plans to use the funding to continue its growth in the Texas market and beyond. To date, the company has raised $34 million. It previously raised $12 million in Series A round of funding led by S3 Ventures with participating from seed investors Silverton Partners, venture capitalist Tim Draper and others.

“Favor has proven that they are building a healthy, scalable business while maintaining their superior service and strong position in the on-demand delivery market,”Brian R. Smith, S3 Ventures Managing Director, said in a news release. “The company’s decision to avoid growth at all costs to instead focus on surgical, smart growth, has led them to beat their profitability goal by six months—a truly impressive achievement. We remain excited and confident in Favor’s future as they build upon this success.”

Favor has made six million deliveries since its launch and plans to make four and half million this year. To meet demand for its services, the company is hiring more than 25,000 independent contractors.

Founded in 2013, Favor is currently available in 15 cities across Texas.