By SUSAN LAHEY
Reporter with Silicon Hills News

What drove Andrew McFadden, Director of Innovation and Business Development at Press Enterprise crazy, was that the Riverside County newspaper company he worked for only saw the downside in readers’ shift to the Internet. The publishers couldn’t see the tremendous opportunity that the shift afforded.
“I’ve been in startups,” he told them. “The hardest thing is to get the door open. You guys already have that. You can open any door you want. There’s money lying around the floor here.”
The newspaper company was already an 800-pound gorilla as far as Google’s search metrics were concerned. It churned out content and directed SEO traffic. But it wasn’t leveraging that position to sell ads. McFadden hooked up with one company, Local.com, that connected the newspapers’ advertisers to websites and social content. But the Press Enterprise was too small to get top tier service from that company. So, McFadden switched to Austin-based OwnLocal. That company, started in 2009, has four products that help leverage the newspaper’s presence to become more valuable to advertisers. AdForge software converts print ads to SEO and SEM optimized online ads. Local Hero is a business search optimization platform that includes maps, directions, coupons and more in a local directory. Web Builder helps small businesses create mini sites linked to the paper since up to 30 percent of the print advertisers they serve have no website. And Daily Deals is just that, complete with distribution and professional writing.
“Every day newspaper reps get calls for print ads, which are worth of a tenth of the price of an online listing,” said OwnLocal founder Lloyd Armbrust. “But online ads are hard to sell because people don’t understand the value.” Part of that value being that online ad ROI is trackable. Print ads’ ROI is much less so.
In smaller markets, advertisers don’t always recognize the value of online ads. They’re not trying to reach a nationwide marketplace, just penetrate a local one. Armbrust talked to a music store owner in Somerset, Pennsylvania who owned the only music store in town. Why would he need an ad? Because, Armbrust explained, when someone new came into town and Googled “music store Somerset, Pennsylvania” another store popped up as the top store. And that store had been gone 10 years. With an online ad, optimized both for SEO and SEM and linked to a heavyweight like the local paper, rankings are bound to rise.
But from McFadden’s standpoint, OwnLocal’s biggest advantage isn’t its software, it’s the company’s customer service. Newspapers buy this process from OwnLocal. They don’t control it or the software. So if something changes, or goes wrong, they need to know they won’t get left behind.
“I’m an (OwnLocal) advocate,” McFadden said. “Every software will have problems. It’s technology, that’s the nature of the business. Everything changes, the search engines change…. The difference I felt with going with OwnLocal is that when have I have a problem and mark an email urgent, I get a response right away. That has nothing to do with technology. That’s how you run your business.”
Armbrust had been in the newspaper industry several years before founding OwnLocal and had seen that print ad revenue was shrinking, and digital revenue was not rising to meet it.
He started his newspaper career as circulation call-center manager for the Duluth News-Tribune and moved to online sales in 2001. He became the expert at building newspaper websites, creating several from the ground up. In 2007, he was working for Morris Communications when the company sold more than a dozen of its small-town newspapers and a commercial printing operation to GateHouse Media. GateHouse was a huge organization with more than 400 publications at the time and it was difficult to get the company to pay attention to Armbrust’s efforts to bring small, community papers into the digital world. So he decided to go out on his own, starting with software that would digitalize print ads.
One of his brilliant strokes was that the paper’s ad reps don’t have to know anything about digital advertising. When they send out information about advertising, there’s a box that says “call your rep to upgrade” or “click here to upgrade.”
“It’s sort of a CRM for ad reps,” Armbrust said, “it adds to digital revenue but you don’t have to hire digital reps. That would be a problem because your print reps would be pissed ‘I’ve had that account for 20 years.’ It aligns everybody’s incentives.”
Armbrust launched OwnLocal in 2009 and in 2010 received funding from Y Combinator, Baseline Ventures, Lerer Media Ventures,the Knight Foundation, Automattic, Paul Buchheit and several other Angels.
Now, OwnLocal is used by more than 400 publications and continues to grow with 12 full time employees in Austin and nearly 40 contractors. The company hopes to get into countries like Japan and India. While the technology is easy to scale and software does a lot of the work, humans have to look over what’s been done because, as Armbrust said, “Computers do weird things.”

Toshiba Lighting & Technology Corp. has bought GreenStar Products, which makes energy-efficient, long-lasting LED lights for roads and other outdoor areas.
The terms of the deal were not disclosed.
Since February of 2012, Toshiba International Corp. has contracted with San Antonio-based GreenStar to make LED Lights.
GreenStar’s LED lights last longer and require less maintenance than traditional roadway lights. They also do not contain mercury or lead.
“We were attracted to GreenStar for its innovative product design and keen focus on developing luminaires that make the most of LED technology to address the market’s desire for more energy efficient and low maintenance products,” Ken Honeycutt, Toshiba’s LED Lighting Systems Division president, said in a statement. “This acquisition allows us to supply a variety of markets from commercial and industrial to governmental and institutional in North America and beyond, with innovative, reliable products that create real value.”
CPS Energy has contracted with GreenStar to replace 20,000 of the city’s lights with LED lights in a year long program that began last year.
In addition to GreenStar, Toshiba also bought Consert, a smart energy home meter company with 60 employees, in February of this year.

MDI Group, an information technology staffing company based in Atlanta, has opened a new Austin office.
MDI recently opened an office Fort Worth and has another Texas office in Dallas and seven other locations nationwide.
The company decided to locate in Austin because Austin’s technology industry is booming and “Staffing Industry Analysts places Austin in the top 20 temporary IT staffing markets,” according to a news release.
MDI plans to have 20 employees in the Austin office by the end of the year. It already has its first client here.
Daryl Fox, a University of Texas graduate, will oversee the Austin office. She has nearly 25 years of IT business development experience.
“After 16 years, I’m excited to return to Austin and leverage my local IT experience and relationships on behalf of MDI,” Fox said. “We’ve hit the ground running and are pleased to have landed our first of many Austin clients – providing ‘best fit’ IT staffing services and contingent workforce solutions.”

The Austin Technology Incubator, known as ATI, in the IC2 Institute at the University of Texas at Austin, reported its companies raised $35 million during the first three months of 2013.
During the last five years, ATI companies have raised more than $250 million of investor capital.
The ATI companies reporting funding in the first part of this year are as follows:

• Spredfast, a social marketing software provider, raised $18 million in venture capital led by OpenView Venture Partners with InterWest Partners and Austin Ventures.
• Savara Pharmaceuticals received a $7.4 million second tranche of a its 416 million Series B financing and received a $4 million grant by the National Institutes of Health. Savara develops pulmonary drugs to treat Cystic Fibrosis.
• Xeris Pharmaceuticals raised $1.7 million in venture capital and $1.9 million from the Texas’ Emerging Technology Fund for the commercialization of its Glucagon Rescue Pen (G-Pen) ™ and G-Pen Mini™ for diabetes treatment.
• Admittance Technologies received $2 million from the ETF for the development and commercialization of CardioVol™, their first platform technology, which enhances the performance of existing cardiac devices and the detection of early signs of heart failure.
• WheelInnovationz received $868,000 in seed funding to continue the development of its mobile-device management software.

“Our number one job is to get ATI companies funded. We accomplish this by surrounding them with talent they couldn’t access otherwise,especially at their early stage,” Isaac Barchas, director, Austin Technology Incubator, said in a news release. “Q1 2013 delivered on this, and we congratulate our portfolio and alumni companies on their momentum.”

InCube Labs, a research incubator in San Antonio, Thursday announced it has launched two new life sciences companies.
Those companies are Theracle, which has developed a treatment for brain cancer, and iBridge Medical, which is developing a technology platform to manage patient’s implanted medical devices.
That brings to five the total number of companies at InCube Labs. The others are Corhythm, Neurolink and Fe3 Medical.
“These new companies represent the 21st century innovation and high-wage job creation that are fast becoming a thriving part of San Antonio’s economy,” Mayor Julian Castro said in a news statement.
“Our new companies represent exciting opportunities to dramatically improve patient care,” Mir Imran, InCube Labs Chairman & CEO, said in a statement.
In 2010, InCube Labs and the City of San Antonio announced the creation of InCube Lab’s San Antonio Innovation Center and three companies moved from Silicon Valley to San Antonio – Fe3 Medical, Corhythm and Neurolink.
InCube Labs also has a center in San Jose, CA.

Providing further validation that Texas has a red hot tech market, Xconomy has launched its eighth bureau in the Lone Star State.
Xconomy, based in Cambridge, MA., covers innovation hubs in Boston, Boulder/Denver, Detroit, New York, San Diego, San Francisco and Seattle.
“Texans pride themselves on being independent, adventurous, and hard-charging: the same characteristics that make for great innovators,” according to Xconomy’s news release.
Angela Shah, a former reporter with the Dallas Morning News and the Austin American-Statesman, is the editor of Xconomy Texas. She’s based in Houston. But it’s Xconomy’s first bureau named after a state instead of a city.
“Texas is unique in that the people who live there identify more with the state as a whole than an individual city,” Bob Buderi, Xconomy CEO and Editor in Chief said in a news statement. “In keeping with this spirit, we felt that it made more sense to have a statewide bureau, rather than a city-based model, especially as we build our presence.”
“Texas has long been a robust part of the U.S. economy with contributions in energy, life sciences and technology,” Shah said in a news statement. “I’m looking forward to now being able to share with Xconomy’s readers the stories of Texas’ personalities and their innovations coming out of its startups, universities and research centers.”
To support the Texas bureau, Xconomy has partnered with BioHouston, BioMed San Antonio, Capital Royalty, Cooley LLP, Rice University, Texas Medical Center, University of Houston, and the University of Texas Medical Branch at Galveston.

Bob Metcalfe, professor of innovation at the University of Texas at Austin, is known to say “the world’s problems will not be solved by another website.”
The co-inventor of Ethernet, which celebrates its 40th anniversary on May 22, and founder of 3Com, should know.
Metcalfe falls into the category of entrepreneur known as an innovator. He created an innovation driven entreprise that changed the world.
He’s even got his own law: Metcalfe’s Law.
To illustrate the difference between innovators and the other startups, the Kauffman Foundation has just released a report, “A Tale of Two Entrepreneurs: Understanding Differences in the Types of Entrepreneurship in the Economy,” detailing how “not all startup companies are created equal.”
Both “innovation-driven entreprises” and “traditional small and medium sized entreprises” can create valuable products, services and jobs, but it’s the big innovators that take on global problems and “can potentially create hundreds or even thousands of high skill jobs if they succeed.”
So the question begs does the high tech region of Austin and San Antonio have enough innovation driven entreprises? And if not, why not?
Certainly, the region has produced quite a few: Dell, National Instruments and Rackspace among others.
“People who use entrepreneurship as a ‘catch-all’ phase to capture a single economic activity make an important mistake,” Bill Aulet, managing director, Martin Trust Center for MIT Entrepreneurship and coauthor of the paper, said in a statement. “Each type faces different hiring challenges, funding needs, growth potential, risk levels and other needs that support organizations must understand to successfully help these companies.”
The Kauffman report details how innovation driven startups are often focused on global markets and are often founded by highly educated individuals with diverse skills and they require external investors. Whereas small and medium startups focus on local or regional markets and they require little outside investment.

By Ian Panchèvre
Reporter with Silicon Hills News

3 Day Startup was a success!
“How so?” you ask.
Well, one of my takeaways from 3DS was an emphasis on using key metrics. In that spirit, I’ve developed a metric that I call the Active Sleep Debt Ratio (ASDR), which is the ratio of the number of hours you’ve slept over the past day.
For example, if over the past 24 hours you’ve enjoyed a healthy 8 hours of sleep, you would have an ASDR of 0.33. The highest ASDR is 1.0, which is only possible after a period of extreme sleep deprivation or medical hardship.
Well, in this case, the day after 3DS, I posted an ASDR of 0.71 with 17 hours of sleep. When it was all said and done, I was very tired.

But please, don’t interpret my ASDR as a complaint. Rather, I see it as a source of pride. All the late nights and early mornings were definitely worth it. Some awesome things happened during those 5-hour-energy-induced bursts of alertness.
For one, I grew as an entrepreneur. Little things, like a worthy book or an interesting concept, frequently came up during conversation. More mechanical things, like research and pitch techniques, were absorbed from both mentors and other participants.
But the opportunity to immediately apply those new insights to a particular task was the best part of the educational experience.
“The experiential learning is really great to see in action,” noted Josh Schechter, an organizer of the event.
Cristal Glangchai, also an event organizer and the director of Trinity’s entrepreneurship program, built on that sentiment during her remarks Sunday evening. Glangchai pointed out that while chemists and biologist have laboratories, artists have studios, and engineers have machine shops, entrepreneurs don’t necessarily have a defined destination for developing their skills.
“3DS is essentially an applied environment for entrepreneurship,” stated Glangchai.
What are some of the things that happen when you compress the entrepreneurial experience into a single weekend? Nerf gun battles and sprints to the kitchen for food were only part of it.
“Pivots,” declared Cole Wollak, a 3DS mentor. “We saw multiple pivots throughout the weekend. Which is good, it indicates that teams are learning.”
Yes, if there is one constant in entrepreneurship, it is that there are no constants. Change is an ever-present force that should be embraced rather than resisted.
To that extent, it was interesting to see how the various projects and teams morphed over the weekend. The company my team worked on, grantsfor.me, changed quite a bit, quite often.
Our journey started with general observations from Wesley Zernial, a grant expert who works with non-profit organizations. Through him, we learned that the system was broken. Market research, brainstorming sessions, and friendly debates caused our team to explore a number of possible solutions: a marketplace to connect grant writers and applicants; an online educational resource center; a common platform for grant providers and grant seekers…
Ultimately, grantsfor.me would improve the grant experience by matching grant seekers with the best possible grant opportunities for them, and by making it easy to electronically file grant applications online. “Match.com meets TurboTax,” we were fond of saying.
Before I knew it, Sunday evening came around. While the Spurs were steamrolling over the Lakers to complete their playoff sweep, I was part of a large crowd that attended the final pitches.
On Friday, 15 concepts were presented. By Saturday evening, the list of concepts had narrowed down to 9. And on Sunday, 5 startups, including grantsfor.me, pitched to a panel of judges, investors, and supporters of San Antonio’s entrepreneurial community.
Dean’s List helps reduce dishonesty and risk during the hiring process by supplementing the traditional resume with a more nuanced work history.
Deal Frenzy seeks to gamify the deal hunting and mobile couponing experience.
Maker Cubes is getting in on the exciting additive manufacturing revolution with its own version of 3D printing.
And finally, one of the more memorable quotes of the weekend – “Think about Kickstarter and American Apparel having a baby and ‘BOOM!’” – came courtesy of Martel Mathews when he was describing 10,000 Threads, a marketplace for fashion designers.
“I thought they all performed admirably,” said Sheridan Chambers, a member of the 3DS judging panel and a Principal at the Denim Group. “The groups were all great. They did an amazing amount of work in a very short period of time.”
After the pitches concluded and the audience had dispersed, an awards ceremony and after party had the entire 3DS body in an upbeat mood.
Throughout the process, “the groups really came together,” shared Mariah Villarreal, a participant.
Glangchai concurred: “The chemistry of the groups was amazing, everyone took feedback really well.”
But perhaps, what had everyone most excited, wasn’t reflective joy over a weekend well-spent, but rather, growing excitement for the future of our community.
“I am thrilled for San Antonio, that it has the brain power and entrepreneurial minds that we were able to see in action,” beamed Cynthia Schluter, an audience member at the final pitches.
Thanks to 3DS, forty local entrepreneurs are now better equipped to pursue their dreams and start new ventures.

A year ago, TechRanch expanded its reach into Chile.
It struck up a partnership with startups in South America to foster that region’s entrepreneurial base.
Now, TechRanch, a coworking space and incubator in Austin, has expanded even further this time into Asia with a partnership in the city-state island of Singapore.
TechRanch and Get2Volume announced their partnership today “to incubate and grow technology companies in Austin, Texas and Singapore,” according to a news release.
Get2volume, funded by Singapore’s National Research Foundation, invests in, mentors and helps grow innovative microelectronics-centric companies.
TechRanch and G2V plan to collaborate to help each venture launch startups in their respective countries.
“Technology companies are global from day one,” Mike Holt, Get2Volume CEO, said in a news release. “Working together with TechRanch, we bring our companies global growth and execution capabilities”.
“This partnership provides portfolio companies with access to capital, connections and complementary capability. We look forward to working together to nurture and empower the next generation of technology entrepreneurs and enable their success” Sandeep Kumar, General Partner Business Development, TechRanch, said in a news release.