The University of Texas at Austin is a hotbed of startup activity.
Last year, the University claimed the number seven spot on Entrepreneur Magazine’s list of the most entrepreneurial colleges in the nation.
And the Longhorn Entrepreneurship Agency, part of student government at UT, plans to showcase some of the state’s most accomplished PC entrepreneurs during its third annual UT Entrepreneurship Week which runs Feb. 28th through March 6th.
Michael Dell, founder of Dell, will speak on March 6th about how he started his company in a dorm room at the university in 1984 and how he took the company private late last year to create what he has dubbed as “the world’s largest startup.”
And the celebration of the PC industry also features a talk with Rod Canion, one of the cofounders of Campaq Computers, founded in 1982 in Houston. Canion’s talk is on March 5th. Canion and his co-founders previously worked at Texas Instruments when they set out to create Compaq. In 2002, HP acquired Compaq for $25 billion.
Brett Hurt, Entrepreneur in Residence at UT and founder of Bazaarvoice, will conduct the interviews. The event is being sponsored by the Herb Kelleher Center for Entrepreneurship.
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Athenahealth, an electronic health care records provider, plans to expand in Austin creating 607 jobs and investing more than $13 million.
The Texas Enterprise Fund is providing $5 million to the company.
In addition, the City of Austin next Thursday will vote on a request to provide an economic development grant worth $679,000, during the next 10 years, from its Economic Incentives Reserve Fund.
Athenahealth, based in Watertown, Ma., is proposing to create 607 new full-time jobs in Austin during the next 10 years with an average annual wage of $132,085, according to a proposal to the city of Austin. The company, founded in 1997, has 2,853 employees. The publicly traded company, traded on the NASDAQ stock market under the symbol ATHN, reported revenue of $539.7 million in fiscal 2013 and a net loss of $4.6 million.
“This TEF investment will create hundreds of high-paying tech jobs in Austin, building on the city’s thriving technology sector and strengthening the state and local economies,” Gov. Rick Perry said in a news release.
Athenahealth plans to move into the Seaholm Power Plant in Downtown Austin and lease 115,000 square feet of space to support its products and customers.
“We’re thrilled at the prospect of growing our presence in Austin, a city with a culture and vibe that perfectly aligns with our own,” athenahealth chairman and CEO Jonathan Bush 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 offers a strong talent pool to aid in the important work we do at athenahealth to advance connectivity in health care.”
By LESLIE ANNE JONES
Reporter with Silicon Hills News
Jeffrey Schwartz and Sara Rodell, co-founders of Loop & Tie, an online gift site, based in Austin., photo by
“I was a stressed-out gifter,” she said, but a few years ago she became so obsessed with removing the stress involved in gift-giving that she quit her stock broker job in New York and moved home to Austin to figure it out.
Her solution is Loop & Tie, an e-commerce site that curates products from Texas and around the world that have a “maker aesthetic” (handcrafted cherrywood coasters, a meat sampler from Kickstarter-funded Lawless Jerky). The site gives the gift of choice: The giver chooses a price tier ($25-100), then places his order for one or multiple recipients, whom are then able to choose any item within the category, though recipients can’t see how much the items cost. The site went live in November and over the holiday season tripled initial sales projections, according to Rodell.
Owner of Tuscan Trading Ian Meltzer said in the past he usually only sent holiday gifts to four to six clients, but this year he gave to 25 people using Loop & Tie.
“Most of my customer base is men,” Meltzer said. “So in the past, I would send them something and they would bring it home and their wives would probably throw it out. This year, they could pick out their gift with their wives so everyone’s happy.”
The speed and the fact it’s possible to slate gifts for delivery months in advance are useful features for corporate gifters, but Rodell says Loop & Tie has attracted both individuals and companies, without a clear trend emerging either way.
Her quest to close the gap between intentions and results in gift-giving started more than two years ago with a different concept. The first effort was a phone app called NOOM (Next One’s On Me) that let users give a friend a treat, like a coffee or beer, from a local Austin outlet without having to buy it in person.
In August 2011, Rodell was visiting Austin from New York when she was introduced to Jeffrey Schwartz, who also happened to be visiting. At the time, he was working in business development for Sony Pictures in Los Angeles.
“We met for coffee for thirty minutes,” Schwartz recalled. “Her dad dropped her off and waited on the other side of the coffee shop.” That was enough time to convince: Schwartz quit his job three weeks later and moved to Austin to work on NOOM.
NOOM went live in March 2012. Geographically, it was limited to Austin, but Schwartz and Rodell discovered that 70 percent of users were from outside the redeemable area. (Rodell guesses this was because Austin is a major event destination and people were using the app during travel.) The profit margins are better in the gifting business than in restaurant food, but Rodell says the main impetus to pivot directions was to remove the locational restraint.
Rodell and Schwartz have been across the country searching for worthy products. They spend a lot of time looking for items that have both quality design and a good brand story; many of the things they carry are made by people who left careers to become artisans.
“When you give a gift, you’re also giving an impression of what your tastes are,” Rodell said. The idea is to curate products that customers don’t have the time to suss out themselves.
The question of content curation in the digital sphere is almost as old as the Internet, but there’s been a market push in the past couple years leading to an increased number of e-commerce sites offering a more personalized experience, according to industry analyst Daniel Rasmus, a former director of business insights at Microsoft. “The idea of curation is fairly recent, outside of us knowledge-management people who’ve been talking about it for twenty some years,” he said.
Rodell pointed out that check-out time at Loop & Tie can take less than one minute because the products have already been curated for the recipient, whereas at Wantful users had to go through a longer process putting together a catalogue of products for the receiver.
For Rodell, the challenge was always to simplify the task but retain the meaningfulness of the gifting ritual in a way where fruit baskets and random bottles of wine typically fail.
“The thought doesn’t count if you don’t do anything,” Rodell said, and she’s thought a lot about how to make the thought count. In college, she majored in economics and has ever since been interested in areas where emotions interfere with making the most market-efficient decision. “Economics,” Rodell laughed, “says we should just give people cash.”
The startup has raised $1.25 million from Silverton Partners and local angel investors, according to an article in TechCrunch.
Pingboard spun out of Capital Thought, an incubator founded by Boebel, Joshua Baer, co-founder of Capital Factory and Jason Cohen, cofounder of Capital Factory and founder of WP Engine.
Pingboard, with five employees, is based at Capital Factory. The company’s first product is an online company directory, which is in beta testing. The directory will serve as the platform for all other office management tasks.
Boebel is an active angel investor in Austin and also serves as managing director of Capital Factory. He founded Webmail.us, an email hosting service, and sold it to Rackspace in 2007.
Blackboard announced Wednesday that is has acquired MyEdu, an Austin-based educational site tailored to college students.
The Washington, D.C.-based Blackboard did not disclose the terms of the acquisition.
MyEdu, founded in 2008, focuses on helping students create a study plan geared to the career they wish to pursue. It’s like LinkedIn for college students. The site helps them create “professional profiles” to find jobs and internships.
MyEdu has helped one million students at more than 800 schools, according to a news release.
“Everyone is looking for ways to help more students obtain degrees more quickly,” Jay Bhatt, CEO of Blackboard said in a news release. “MyEdu has created user-friendly tools that help students succeed and create a stronger connection between higher education and the workforce. MyEdu is highly complementary to our current solution set and will help us drive more value and a higher quality experience for learners and enable new paths to support student goals. This strengthens the focus we have on learner success, which is a big priority for us going forward.”
MyEdu has partnerships with the University of Texas, the University of Louisiana and other institutions.
The company, which has 20 employees, has raised more than $20 million in venture funding, with the majority coming from Bain Capital Ventures, according to its Crunchbase profile.
LiveOak Venture Partners of Austin has invested $2 million in CS Disco, a Houston-based software company.
CS Disco plans to use the Series A funds “to triple the size of its engineering, sales, and operations teams and expand its offices in Houston in 2014,” according to a news release.
The startup makes software for lawyers to use in the process of researching cases and finding evidence in commercial litigation and corporate investigations.
The company has more than 50 law firms as customers and two of the largest insurers in the world.
“Disco is unique in including processing, early case assessment, a hosted review platform and document production capabilities in a single software platform for a monthly fee per gigabyte,” Kent Radford, CS Disco co-founder, said in a news statement.
San Antonio-based Rackspace Hosting has filled a top spot in its executive ranks.
On Tuesday, the company announced the appointment of Taylor Rhodes, formerly its Chief Customer Officer, as its new president effective immediately.
“Taylor is a proven operational veteran with outstanding strategic and leadership skills,” Rackspace CEO Lanham Napier said in a news statement. “He has generated strong growth in all the businesses he has led. Our international business, for example, grew 30 percent a year under his leadership. His relationships with customers and his deep understanding of the market and where it’s headed will be invaluable as he steps into this new role. Taylor’s promotion represents a successful example of the company’s long-term talent-development plan.”
Last summer, Lew Moorman stepped down as Rackspace president, citing family reasons. Moorman had been with the company for 13 years. He still serves on its board of directors. Napier has served as acting president until Rhodes appointment.
WP Engine, the startup that specializes in hosting WordPress sites, announced Tuesday that it has received $15 million in venture capital from North Bridge Growth Equity.
The company plans to use the money to focus on its products and customer service, according to a post by Heather Brunner, the company’s CEO, on the WP Engine Blog.
TechCrunch broke the news this morning.
“The funding comes at a time of explosive growth for WordPress, which is now the most popular content management system on the Internet,” Brunner wrote. “Since our founding in 2010, we have grown alongside WordPress to power tens of thousands of websites and applications built with the WordPress platform.”
With the latest round of funding, Matthew Blodgett, a general partner at North Bridge Growth Equity, joined the company’s board.
“We are thrilled to partner with the WP Engine team as they build the next great platform company for the front lines of digital customer interaction,” Blodgett said in a news statement. “WP Engine has what it takes to win – a powerful vision, strong technology and a seasoned executive team with a track record of success. Together with their clients and the WordPress community, WP Engine is building a new breed of fast, secure, and reliable content management.”
Silicon Hills News did this profile of WP Engine in 2012. Last year, WP Engine moved out of Capital Factory into larger headquarters downtown.
Main Street Hub announced today that it has closed on $14 million in venture capital led by Bessemer Venture Partners.
The Austin-based company manages social media communications for small to medium-sized businesses in the U.S., Canada, U.K., Ireland and Hong Kong.
Main Street Hub plans to use the funding to further develop its products and to hire sales staff in Austin, San Francisco, New York and Los Angeles.
Existing investors also participated in the round. The company previously raised $6 million.
“Keeping up with shifts in social media and other ways to connect with customers online is a full time job, but it’s not something most local businesses are staffed to manage. Main Street Hub makes the process painless and rewarding with a full service ‘do-it-for-you’ SaaS marketing platform that helps local businesses through the entire marketing funnel with a combination of people, data and innovative technology,” Co-founder and Co-CEO Andrew Allison said in a news release.
Silicon Hills News did this profile on the company last summer.
Main Street Hub charges businesses a fee to manage their social media presence online including postings on Facebook, Twitter, Yelp, Google+, Foursquare and TripAdvisor. The company designs a customer relations management platform that allows businesses to easily communicate with customers and to market to them.
The company, founded in 2010, has close to 3,000 customers and 175 employees in four offices.
“At BVP, we’re sensing a shift in power as technology levels the playing field for smaller companies and gives them access to solutions and platforms that were previously only afforded by large box stores and behemoths. Main Street Hub will be a key player in this: They make it possible for local businesses to leverage every channel and engage directly with their customers with a tailored approach that doesn’t require any change of behavior for the merchant or their customers,” Rob Stavis, partner at BVP said in a news release. “In backing Main Street Hub we are not only investing in this growing trend, but also investing in a great company and team that can execute.”
Bazaarvoice has been found guilty of violating U.S. antitrust laws involving its $168 million acquisition of rival PowerReviews.
Judge William Orrick with the U.S. District Court for the Northern District of California issued the ruling last week following a three week trial which began on Sept. 23rd. The court has scheduled a hearing on Jan. 22 to discuss sanctions for the violation.
“By acquiring its only significant rival, Bazaarvoice deprived its customers of the benefits of competition,” Assistant Attorney General Bill Baer said in a news statement. “We are pleased that the court, after carefully weighing all of the evidence, agreed with the Justice Department that Bazaarvoice’s acquisition of PowerReviews was likely to extinguish price competition and substantially diminish the pace of innovation in the market for product ratings and reviews platforms.”
“As shown during trial, Bazaarvoice executives clearly intended to eliminate competition by acquiring PowerReviews,” according to Baer. “Consistent with Bazaarvoice’s own pre-merger view of the marketplace, the evidence presented at trial demonstrated that PowerReviews was a significant threat to Bazaarvoice and that other rivals are poorly positioned to fill the competitive void created by the merger.”
Austin-based Bazaarvoice bought PowerReviews in June of 2012. The Department of Justice began its investigation shortly after the deal closed and filed a civil lawsuit against the company on Jan. 10, 2013.
Bazaarvoice issued a news release stating that the company will not make a decision on whether to appeal the court’s ruling until it concludes the remedy phase of the litigation.
“We are disappointed in the outcome of the litigation. We believe that the merger with PowerReviews has been beneficial to customers, as did the more than 100 customers who testified that they did not believe that the acquisition affected them adversely in any way,” Gene Austin, president of Bazaarvoice, said in a news statement. “Throughout this process, our focus has remained on serving our clients and providing them with a full range of social software that helps them engage more powerfully with their customers. With the Court’s decision, we’ll now do everything we can to help ensure that the final order achieves the best outcome for our clients, shareholders, and employees.”
Founded in 2005, Bazaarvoice provides a software platform of online consumer reviews and ratings for online retailers including Dell, Best Buy, Costco and Macy’s.