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Austin Startup Rockify Holds TechTainment Fundraiser

By ANDREW MOORE
Reporter with Silicon Hills News

Austin startup Rockify hosted its first inaugural TechTainment retreat last Friday in the West Lake Hills area of Austin. The event was a fundraiser sponsored by Arthur Edstrom and Kathleen Blackwell of XYZ2Y Ventures and was held in the couple’s new home. Deep Eddy Vodka was also a sponsor.
The retreat featured an interview with music legend Gregg Rolie — co-founder of both Santana and Journey – and an intimate living room performance with notable musicians Ron Wikso, Alan Haynes, and Evan “Sticky” Arredondo.
Rockify is currently in the seed round of fundraising and needs to raise $250,000 by the end of the year. They will need another $3 million by the summer of 2013 to hire additional staff and improve their product.

Rockify CEO Joel Korpi, Photos by Samantha Davis

Rockify CEO Joel Korpi, Photos by Samantha Davis

CEO Joel Korpi invented Rockify to take advantage of current trends in the way people listen to music and view music videos.
“YouTube serves more music than Spotify, Pandora, and all other music companies combined,” Korpi said. “The problem is, YouTube is not a music platform … the user experience is just not designed for it.”
Taking advantage of this gap in online entertainment, Korpi invented Rockify — a music video discovery platform that looks like old-school MTV but works like Pandora. The platform curates music videos from sources around the web – YouTube, Vimeo, Daily Motion, etc – and displays them in a constant stream that is tailored to the user’s music taste.
The key feature of Rockify is Korpi’s decision making algorithm that discovers not only what users like but what they will like in the future. Users log in with either their Facebook or Twitter account and the algorithm uses their social information and interaction to discover and predict what content the user will be interested in.
“We use the entire social graph,” Korpi said. “What your best friend likes. What your girlfriend, your wife likes. We use that statistically for better accuracy.”
Korpi said that the algorithm can learn a user’s patterns over time and – after about 100 hours of use – can reliably find new music that a user will like. Users will also be able to like or dislike videos shown to further refine the video discovery process.
The Rockify website launched in May and has already acquired 25,000 users by word of mouth alone. Korpi said that the site’s analytics show users spending an average of 23 minutes on the site. Ten percent of those have already switched to the paid premium content offered by Rockify, which currently has an indexed web library of 250,000 music videos.
Several companies and investors have already taken notice of the huge potential for entertainment, advertizing revenue, and direct sales that Rockify’s content platform and decision making algorithms provide. The startup has already entered a business partnership with Austin City Limits, which will use the Rockify platform on their ACL iPad app to display performances in full HD.
Whoohoo! Media Group CEO David Skye

Whoohoo! Media Group CEO David Skye

Rockify also has a partnership with Whoohoo! Media Group– which it announced for the first time at Friday’s TechTainment event. Created by CEO David Skye, Whoohoo! archives and re-masters historical recordings of live music performances over the last 30 to 40 years. The archives come from many sources including old storage facilities and bootleg recordings. Skye plans to use the advantages of the Rockify platform to release his library of digital archives and provide a fun way for fans to discover, enjoy, and purchase them.
“The key is taking these older archives from bands and re-mastering them along with the Rockify platform to get them out there in a digital format – streaming, downloading – and really bringing the fans what they want,” Skye said.
Umbel is another of Rockify’s partners. An audience analytics company — Umbel utilizes different sources of data, including social media, to help businesses better target their customer base. Korpi envisions working with Umbel to help artists and bands maximize their fan base, publicity and sales by using Rockify’s discovery algorithms. Umbel will also play a key role in helping Rockify understand their consumer base.
While potential investors attending the TechTainment event were eager to hear how Rockify will make money, CEO Korpi currently has no plans for monetization. Instead, Korpi is focused on growing an industry-changing member base that will gain value and recognition as it grows – much the same way that Facebook began.
“Like Facebook or Twitter or Google we’re worried about building a kick-ass product first and growing an audience,” Korpi said. “We are not necessarily worried about how we are going to monetize it because if you have people then you can monetize them.”
Korpi said he will use established revenue models – such as the ads and commercials found on other sites – once Rockify builds a large enough user base. Rockify’s platform is currently limited to music videos, but Korpi said that his discovery platform and decision making algorithms could be adapted to any form of digital media – providing a wide range of producers and advertisers a platform which can easily target their most likely consumers.
From left: Austin Technology Incubator Director Kyle Cox, Rockify CEO Joel Korpi, Arthur Edstrom of XYZ2Y Ventures

From left: Austin Technology Incubator Director Kyle Cox, Rockify CEO Joel Korpi, Arthur Edstrom of XYZ2Y Ventures

Some of Rockify’s investors include Arthur Edstrom and Kathleen Blackwell of XYZ2Y Ventures, Kip McClanahan of Silverton Partners, former head of New Line Cinema Gordon Patterson and Austin Technology Incubator Director Kyle Cox. XYZ2Y Ventures and Kip McClanahan provided much of the initial $180,000 that got the startup on its feet.
Arthur Edstrom, who served as the MC for the event, said that investing in companies like Rockify is essential if Austin wants to keep their entertainment technology market.
“If we don’t step up and really get behind companies like Rockify, then they have to go someplace else,” Edstrom said. “And it would be a shame because Austin has everything that Rockify needs.”
Music Legend Greg Rolie

Music Legend Gregg Rolie

After the Rockify presentation Edstrom held a keynote interview with music legend Gregg Rolie. The interview discussed Rolie’s experience in the music business as both a musician and a businessman. The business world has changed since Rolie co-founded Santana years ago, but Rolie said there are some things that don’t change.
“I’m telling you, it’s all the same,” Rolie said. “You don’t have a good product, you have a problem. You don’t have good people, you have a problem. You can’t get along, you really have a problem. So there are a lot of similarities.”
The night ended with Rolie playing a set in Edstrom’s living room. He was joined by guitarist Alan Haynes who has played with Stevie Ray Vaughan, drummer and close friend Ron Wikso who was part of Foreigner, and bass player Evan “Sticky” Arredondo who has toured with the late Sonny Bono as well as other notable stars. The band played several alternate versions of Santana and Journey songs – including Black Magic Woman – as well as favorites from other groups.
Edstrom hopes to continue creating events that brings together Austin’s technology and entertainment industries. Korpi said that Rockify will host another TechTainment event no later than Austin’s next South by Southwest festival.

Dell, Once a Startup, Works to Help Other Startups Succeed

Ingrid Vanderveldt, leader of Dell's Center for Entrepreneurship

Ingrid Vanderveldt, leader of Dell’s Center for Entrepreneurship

Next year, Snap Trends, plans to hire 100 new employees.
The Austin-based startup, launched last summer, does social media monitoring and currently has 20 employees. It is hiring web developers, administration and sales people, said Eric Klasson, its founder and CEO. The company raised more than $500,000 from investors in August, according to an SEC filing. Klasson attended Dell’s Austin Think Tank for Entrepreneurs on Friday. His company belongs to Dell’s Founders Club, designed to assist a hand-picked group of startups.
Access to talent is one of the big challenges facing small business in Austin today, according to many of the 30 people attending the think tank event. And more than half of them expect to add employees next year.
Gene Marks, a nationally recognized small business columnist and speaker, led the discussion along with Ingrid Vanderveldt, Dell’s entrepreneur in residence and Drew Scheberle, senior vice president with the Greater Austin Chamber of Commerce.
Dell invited the entrepreneurs, which ranged from a furniture storeowner to a web design firm. The meeting is part of Dell’s big push to help startups and small businesses. It was its sixth think tank, but the first one in Austin. Dell held others in Miami, Atlanta, Chicago, Los Angeles and the Bay Area.
The focus for small and mid-sized companies in the next year is on increasing productivity, growing revenue and reducing costs, according to Dell’s research.
This week at Dell World, Michael Dell announced the launch of its new Center for Entrepreneurs. Vanderveldt leads the center, which offers access to technology, expertise and capital through programs like the Dell Innovators Credit Fund, Dell Financial Services and Dell Ventures.
At the event, the entrepreneurs talked about ways to hire new talent in an increasingly competition marketplace. They suggested networking at events like Door 64’s job fairs and happy hours, hiring interns and working with local universities. But some business owners complained that they could find talent but they couldn’t find people with a strong work ethic and passion. Some had to hire offshore to meet their staffing needs. They said passion and motivation often trump experience.
A skilled workforce exists here, said Scheberle with the Austin Chamber.
“People see Austin as a place of opportunity,” he said.
The workforce attracts big companies like Visa, General Motors and Union Pacific, which all recently announced plans to establish new innovation centers in Austin. But small business can still find people to hire here, he said. He estimates 100,000 people in Austin are underemployed. Retraining programs could put them to work in better jobs, he said.
“We can’t be complacent,” Scheberle said. “We have to work really hard to make sure we’re developing talent.”
In addition to attracting new talent, Austin’s small businesses face big hurdles finding capital to expand.
In 2013, 55 percent of Austin small businesses expect finances to improve and 70 percent expect a better sales outlook, according to Dell research. And 58 percent of small businesses tap into their savings as the top source to fund their ventures.
Tim Porter, CEO of Appddiction Studio in San Antonio, said he hasn’t been able to find bank financing despite having $600,000 in revenue in the last year.
The lenders want to see three years of financial statements before they’re willing to take a risk, he said. He’s financed his startup by tapping into his 401K retirement account.
David Davis, CEO of Provencal Home, said the bank for the furniture store cut off credit lines and called loans following the 2008 financial crisis.
The group brainstormed creative ways to finance businesses through crowdfunding, seeking angel investment from the Central Texas Angels Network and even using credit cards.
In addition, Dell will host a Technology Innovators Day on January 24th at its headquarters in Round Rock in which small business owners and startups can pitch to the top business executives at Dell to do business with the company or seek investment, Vanderveldt said. Companies need to apply at its website beforehand and Dell will select who gets to pitch, she said. Dell will evaluate the companies for acquisition, partnership or as potential investors, she said.
“Dell is basically doing everything and anything in our power to help entrepreneurs gain access to the capital they need,” Vandervelt said. “I’ve never seen a Fortune 50 company do anything as extensive as this. Dell is really reaching out to the entrepreneurial community.”

Infographic on Austin Small Businesses

Creative Networks of Collaboration Key to Solving the World’s Problems Says Former President Clinton

IMG_0038Nearly 20 years ago, President Bill Clinton took over as leader of the United States.
In 1993, an average cell phone weighed five pounds.
Only 50 websites made up the Internet.
And Clinton sent a total of two emails as president.
“It’s all different now,” Clinton told more than 5,000 people gathered for Dell World in Austin. He gave the afternoon keynote address on Wednesday.
“In a world that seems to be full of zero sum games and conflict models that try to hold on to the past, the future belongs to network collaborators,” Clinton said.
Today, the world is more interdependent than at any time in the history of humanity, Clinton said.
“We cannot shut each other out,” Clinton said.
In this interconnected world, defense budgets still matter and so does security, but not as much as they used to, Clinton said. To solve the world’s problems, people need to build inclusive communities and focus on non-zero sum games, he said.
“We like zero sum games,” Clinton said. “But non-zero sum games are making sure you win by making sure everyone else wins. If we want the world to work we have to have more non-zero sum games.”
IMG_0037Non-zero sum games ultimately benefit everyone, Clinton said. For example, during his presidency, Clinton spent $3 billion of taxpayer money to support research to develop the Human Genome. That has led to remarkable new treatments for children’s cancer and an open sharing of information. A genome test now costs $5,000 and will decrease to $1,500 next year, Clinton said.
“Networks of creative collaboration,” have made the advancements in finding cures for cancer possible, Clinton said.
The Hubble telescope and space exploration technology led to the identification of more than ten planets in the solar system that are able to support life, Clinton said.
Clinton said he’s an optimist and he sees “a lot of good things about this world.”
But the world has three huge problems.
“First of all it’s too unequal,” he said.
Nearly half the world’s population lives on less than $2 a day, nearly 1 billion people are illiterate and 1 billion do not have safe water, according to United Nations statistics. And 100 million kids don’t go to school.
“Within America and around the world, we have to create ways to share prosperity and reduce inequality,” Clinton said.
IMG_0039Some inequality and some instability are good for the economy, he said. But extremes shut things down and make people entirely too risk averse, he said. The economy needs sufficient instability with the chance to fail as well as the chance to succeed, he said.
Another problem is the world is unsustainable because of the way we consume energy, Clinton said. Climate change is real and the U.S. must consume less energy and do things differently, he said. People need to deal with the problem and not debate whether it exists, he said.
Twenty years ago, Sweden imposed a carbon tax on its business. Swedes are inherently responsible, Clinton said. The government gave the tax money back and told the companies they just wanted them to know how their actions would impact the future. The companies invested more money on reducing energy consumption by putting in more efficient lighting and cooling systems and other infrastructure changes. Between 1997 and 2010, Sweden’s economy grew by 50 percent and it reduced its greenhouse gases by 7 percent mostly through efficiencies, Clinton said.
“That’s the sort of debate we ought to be having,” he said.
Lastly, Clinton is focused on fighting childhood obesity through the “Alliance for a Healthier Generation.”
“Poor, overweight kids were getting more than half their calories from sodas,” Clinton said.
If that trend continued, the soda manufacturers wouldn’t have any customers because they would die an early death from diseases like diabetes. And the children would have their lives cut short. Instead, Clinton worked with the soda manufacturers to create a different future in which everyone makes money in a different way. And in the last five years, there has been a 90 percent reduction in total calories sold to students in 98 percent of schools, Clinton said. Through “a creative network of collaboration” they were able to solve a huge problem, he said. Michael and Susan Dell’s son, Zach, serves on the board of the Alliance for a Healthier Nation, Clinton said. Some of the best ideas they get are from kids, he said.
People also need to become more tolerant of our differences and learn to live together regardless of political or other beliefs.
“If we can get back into the tomorrow business and do it together we’ll be just fine,” he said.
Following his keynote address, Clinton, who wore orange and white Texas Longhorn cowboy boots, sat down with Michael Dell to answer a few questions about the economy. He said the government needs to spend more on research and development and that will help the U.S. remain competitive globally. He pointed out that countries like Singapore are spending $5 billion to become the world’s biotechnology leader. The U.S. faces stiff competition and the government should never let research and development spending fall below three percent of the nation’s gross domestic product. It’s currently in jeopardy of doing so, he said.

San Antonio’s Startup Catalyst Geekdom Celebrates Its First Year

Graham Weston and Nick Longo, co-founders of Geekdom

Graham Weston and Nick Longo, co-founders of Geekdom

A year ago, Graham Weston and Nick Longo created Geekdom to build a startup community in San Antonio.
“We wanted to put entrepreneurs and geeks together and watch the sparks fly,” said Weston, chairman and founder of Rackspace and co-founder of Geekdom.
“It way exceeded our expectations,” Weston said.
Geekdom is now the state’s largest co-working space and technology incubator with 500 members occupying 45,000 square feet at the Weston Centre downtown.
“We’re adding 40 members a month every month,” Weston said. “We look forward to doubling again next year.”
On Wednesday, hundreds of people turned out to celebrate Geekdom’s one-year anniversary at the Weston Centre downtown. The Spazmatics band entertained the crowd along with Comedian Steve Trevino. At the party, Geekdom showed off its new Geekbus, which SparkEd’s Louie Pacilli heads up. Starting in January, he will visit area
The Spazmatics entertain the crowd at Geekdom's 1st Anniversary Party.

The Spazmatics entertain the crowd at Geekdom’s 1st Anniversary Party.

schools three times a week in the bus to teach technology skills. Geekdom also provided tours of the co-working site. And rides on a mechanical bull.
SparkEd Director Louie Pacilli with the Geekbus, which will start visiting local schools in January.

SparkEd Director Louie Pacilli with the Geekbus, which will start visiting local schools in January.

In just a year, Geekdom has helped more than 50 startup companies.
“We really think Geekdom can create a heartbeat for the technology community in San Antonio,” Weston said. “So many people believed that Geekdom wouldn’t work in San Antonio. Little did we know there was so much pent up demand for a place for the geek community to come together to rally around.”
IMG_0064Geekdom has become the place where technology entrepreneurs connect and collaborate, said Nick Longo, mentor-in-chief, cofounder and executive director of Geekdom. He joked that he started the site so he could live vicariously through the startups and founders.
“In my mind, I’ve done 200 startups,” Longo said. “It hasn’t cost me a dime. I don’t have to guess about the future. I have a bright outlook that I’m going to succeed.”
In reality, Longo has helped mentor dozens of companies at Geekdom during its first year. He’s also volunteered at 3 Day Startup and he has spent countless hours consulting with startup founders. Geekdom has held more than 220 tech events and programs so far including SparkEd, a weekend program which teaches at-risk middle school students how to build a robot, program it, build a business and a website.
Geekdom also recently created a video and sound studio on its 10th floor. It also has a 3-D printer and other equipment in its Makers Lab focused on robotics and circuit work on the 11th floor. And early next year, Geekdom will open the Open Cloud Academy on the 6th floor to train and certify military veterans and the public to become system administrators.
Geekdom is a magnet that’s drawing people from all over the state interested in
Nick Longo and Graham Weston, co-founders of Geekdom with visiting Texas A&M students.

Nick Longo and Graham Weston, co-founders of Geekdom with visiting Texas A&M students.

technology and startups, said Shelly Brenckman, marketing director for Startup Aggieland. She drove from College Station with four Texas A&M students for the Geekdom party. They spent the night at the Hyatt Regency on the Riverwalk. The trip was all worth it because the students got to meet and talk with Weston, a graduate of Texas A&M and highly successful businessman, and visit Geekdom, Brenckman said.
“Everything we’ve done at Aggieland Startup, we’ve modeled after what Geekdom has done,” Brenckman said.
Weston is changing the landscape of Texas technology and education, Brenckman said.
“I don’t think people realize how much Graham is doing to help Texas,” she said.
Geekdom has also expanded to San Francisco and will open that site in April, Longo said. And it’s eyeing expansion into Asia, South America and Europe.
“We’re considering other cities as well,” Weston said. “I think the exciting thing is that so many people have heard the name Geekdom and they know just a little about it. Yet it resonates so quickly they want to be a part of it.”
Other cities have approached Weston about establishing a Geekdom in their communities.
Stacey and Paul Ford at Geekdom's 1st Anniversary Party

Stacey and Paul Ford at Geekdom’s 1st Anniversary Party

“It’s really the pioneer of open ideas,” Weston said. “Everyone is working on different things but everyone around you at Geekdom wants you to succeed. They will take the time to help you.”
Geekdom is about going from an idea to a fundable startup, Weston said. To support that, Geekdom offers a fund, which invests $25,000 in startups. Every month, a board meets to review the applications and interview the entrepreneurs.
“A number of companies that have been started are from former Rackers,” Weston said. “Geekdom has been part of helping them realize their entrepreneurial dream.”
The Geekdom process has happened naturally, Weston said. It’s a supportive, collaborative environment and company founders can learn and grow with the help of seasoned mentors. The entrepreneurial process is not easy, but it can be rewarding.
“It’s exciting to be in charge of your destiny,” Weston said.
Vid Luther, founder of ZippyKid

Vid Luther, founder of ZippyKid

ZippyKid’s CEO and Founder Vid Luther would agree with that statement. He moved his company into Geekdom when it opened. He had five employees. Today, he has 10 employees.
“It’s just a cool working space from ZippyKid’s perspective,” Luther said.
For the community, Geekdom has served as a catalyst to bring together the city’s technology industry and to put a spotlight on all that’s going on here.
“A lot of people didn’t realize how much technology talent was here until Geekdom,” Luther said. “I think Geekdom is a movement and people will remember this as what made San Antonio show up on the nation’s technology map. This is just a start.”
Paul Ford, vice president at Soft Layer, agreed.
“This is the new style of doing business and Geekdom has been at the forefront of the technology movement in San Antonio,” Ford said. “It’s remarkable what they accomplished in a year.”
Rebecca Schenker, an architect with a self-described geeky side, joined Geekdom last Spring because she liked the community.
“I like the idea of having a place where you can be a part of something bigger,” she said. “It’s fun and it’s educational.”
Louie Pacilli of SparkEd, Dan Garcia and Jon Dobbertin, co-founders of CallGrader and Patrick Deuley with Geekdom

Louie Pacilli of SparkEd, Dan Garcia and Jon Dobbertin, co-founders of CallGrader and Patrick Deuley with Geekdom

Jon Dobbertin and Dan Garcia, two of the co-founders of CallGrader, which just completed the DreamIt incubator program in Atlanta attended the party and credited Geekdom for helping the company get off the ground.
“For us, Geekdom was the starting point,” Dobbertin said. “We moved in last December and we were one of the first companies based there. It helped us immensely. It’s definitely a great catalyst.”
Being around other startups and like-minded people helped a lot, Garcia said.
Jeremy Karney and Zac Harris of Monk's Toolbox

Jeremy Karney and Zac Harris of Monk’s Toolbox

Monk’s Toolbox, a software start which automates the back end of breweries, just recently moved into Geekdom following its formation at 3 Day Startup.
“Geekdom’s about mentorship, collaboration and camaraderie,” said Zac Harris, Chief Monk. “It’s probably one of the best things to happen in my career trajectory. It’s a breath of fresh air for San Antonio.”

Geekdom is a sponsor of Silicon Hills News

Dell Touts PC Business as it Diversifies into New Areas

IMG_0033In a packed Austin Convention Center ballroom, the lights dim and a video plays.
“In 1984, Dell was one guy with a dream,” says the narrator.
In the last 28 years, Dell has evolved into a $58 billion company with 109,000 employees worldwide. And in the last four years, Dell has pushed to transform itself from a PC maker into a software, services, solutions and hardware company. In the process, it has diversified into new areas like data centers.
“While much has changed in that transformation, much has stayed the same,” the video announcer proclaims.
Michael Dell enters the stage. He’s been actively involved in Dell since he founded the company in his dorm room at the University of Texas. He has articulated the company’s vision and worked to change its culture through organic growth and acquisitions. He’s fired executives, hired new ones, acquired new businesses and shifted the company’s focus from PCs to solutions.
“This is an incredibly powerful moment for me,” Dell tells the audience of more than 5,000 customers, partners, employees, analysts and media. He is delivering the keynote address at the second annual Dell World event. “I’m so proud of what you’ve accomplished with Dell at your side.”
Then Dell shows a video of a rover landing on Mars, exploration at the South Pole, Genomics research and more. Dell’s customers have used its products to solve some of the universe’s most vexing problems.
“From the beginning Dell has been out to power your dreams,” Dell said.
Some of its customers achievements are on display at the Dell World Expo. The showcase has examples of Dell’s customers using its products in a variety of industries. Dell is working on cloud, data center and security solutions for customers and much more.
“We’re working to democratize and simplify these innovations,” Dell said.
A major focus is securing all the devices in a “Bring Your Own Device” environment at companies. It’s all part of Dell’s focus to become the industry’s leading provider of end to end solutions. The company spent $5 billion in the last year to build out its solutions portfolio. But the PC business, or what it refers to as the “client” business, continues to contribute to its bottom line.
“We strongly believe PCs are important,” Dell said. “Overwhelmingly PCs are still how business gets done today.”
Microsoft’s new operating system, Windows 8, also brings together PCs with touch screen technology creating more dynamic computing devices. Dell’s Latitude 10 tablets run Windows 8 along with Dell’s XPS 12 Notebook, which transforms from a laptop into a tablet. In addition, Dell just introduced an all in one portable workstation and entertainment center that also runs on Windows 8.
“The possibilities are limitless,” Dell said.
Windows 8 gives the 1.5 billion installed base of PCs worldwide a reason to get a new PC, Dell said.
Dell is also pushing big into the data center industry. It has been in the server business for more than two decades. Dell is number one in North America and Asia in the server market and is only 64,000 servers away from being number one in the world, Dell said.
Dell’s open standards have made it easy to integrate its products into existing data centers. Its software really helps to secure and manage customers’ environments, he said.
“The consistency of our vision and strategy is paying off big time,” Dell said.
The final piece of Dell’s strategy is the services industry, which now employs 47,000 of its workers.
“We’re ready to help you achieve your objectives,” Dell said.
The company manages 32 billion in security incidences every day.
“We know about what’s going on in the world of cyber security more than anyone,” Dell said.
In the healthcare industry, Dell manages 114 million mission critical devices. Dell also prides itself on its customer support and gives a response time of two to four hours, Dell said.

Dell World 2012 Kicks Off in Austin

The transformation of Dell into a software solutions, services and cloud computing company is underway.
“We needed to go beyond the origins of the company” into areas like data centers and services “to build out a broad portfolio,” Dell Founder and CEO Michael Dell said during a meeting with media and analysts Tuesday afternoon.
The company has invested $10 billion in the last four years to create an end-to-end solutions company, Dell said. Most notably, the company acquired Quest Software for $2.4 billion in July.
Dell Enterprise Solutions and Services now make up $20 billion, or one-third of its revenue.
But the Round Rock-based company still has its personal computer business and it isn’t getting rid of it anytime soon.
In fact, Dell will unveil a next generation workstation and portable entertainment product during his keynote speech at Dell World 2012 Wednesday morning.
This is the second annual Dell World event. It takes place through Thursday at the Austin Convention Center. More than 6,000 Dell customers, partners, media, analysts and employees are expected to attend. Many of them gathered Tuesday evening at Austin City Limits to listen to music and eat from Austin food trucks.
On Wednesday, former President Bill Clinton and Dell will talk about the Clinton Global Initiative, philanthropy and other issues during the morning keynote.
The authors of the Freakonomics and SuperFreakonomics books, Steven Levitt and Stephen Dubner, will deliver the closing keynote address “Think like a Freak.”

UTSA CITE Competition Creates New Student Tech Startups

By ANDREW MOORE
Reporter with Silicon Hills News

Lapara Medical beat five teams to win first place at the University of Texas at San Antonio biannual $100,000 Student Technology Venture Competition.
The Lapara Medical team includes business majors Warren Norket, Shelbi Chrislip and Duncan Hughes, and engineering majors Richard Canty, Adam Daufen, Luis Davila and Justin Ernest.
“We thought we had a really good chance of winning, but there was some healthy competition,” Daufen said.
Lapara Medical created a prototype for a laparoscopic cooling system for kidney surgeries. The system is more effective and less invasive than the current method, which involves making a large incision in the patient and placing ice packs next to the organ. The student’s laparoscopic device requires much smaller half-inch incisions, cools the organ more easily, and keeps the organ at a more consistent temperature — allowing surgeons a larger window of time to operate without risking damage to the organ. It also results in less scarring, less pain, and a shorter hospital stay.

Lapara Medical Team: From left: Justin Ernest, Adam Daufen, Richard Canty, Luis Davila, and advisor Yusheng Feng

UTSA engineering students Davila and Canty designed the device with the help of Yusheng Feng – who runs the Computational Bioengineering and Control Lab at UTSA. The students worked on prototypes for more than a year.

Lapara Medical Team Members – From left: Duncan Hughes, Warren Norket, and Shelbi Chrislip


Following the competition and finals, the students have little time to rest — their startup needs to incorporate, move into new offices, restructure and hire a seasoned CEO like their mentor, Mr. Rubén Zamorano, currently CEO of Bexar Medical Inc. He has mentored five teams in CITE competitions. Lapara Medical might also change its name to avoid sounding limited to laparoscopic devices.
As the winners, the team will receive $100,000 in cash and services from the competition’s sponsors. They will receive legal help from the Cox Smith law firm and office space for a year from the San Antonio Technology Center.
The Center for Innovation and Technology Entrepreneurship – or CITE – hosted the competition to give students hands-on experience as early stage entrepreneurs.
“It pairs up seniors of engineering and seniors of business to turn their innovations and business plans into real start-up potential,” CITE Director Cory Hallam said.
In addition to Lapara Medical, Jack Rabbit and Western Immersion Engineering finished second and third. The other teams included Gear Flux, Minesweep and Wind Hawk.

The Jack Rabbit

The Jack Rabbit is a remote controlled vehicle jack designed by engineering student David Hughes. It can be driven under a disabled vehicle and, while working in tandem with another Jack Rabbit, can lift the disabled car and actually move it across a vehicle shop floor. Justin Ernst, Luke Walker and Brooke Forest and Hughes founded the startup. They plan to move forward with their product after conducting additional market research and making design improvements. Jack Rabbit has just recently brought on marketing major Alan Schaffler and finance major Tim Nieland. The team was excited to get second place.
“Once we placed, we just were like ‘whoa we just placed!’ — we can actually start this company, we can actually go somewhere with it,” Walker said.

The Jack Rabbit Team – From left: Luke Walker, Brooke Forest, Justin Ernest, David Hughes


So far, the team has spent $1,200 and they need around $1,500 more to create a fully functioning prototype. Hughes said that if they could raise around $25,000, they could work with a manufacturing company and get the product to market much faster.
Western Immersion Engineering’s RowdySim 240 is a motion gaming chair that moves and pitches when used with racing games or flight simulators. Team lead Breanna Oliver is confident that the product will sell. She has some interested investors and has already sold the prototype that her team presented.
CITE Director Hallam said that while a few of the many startups created in the CITE competition are in the process of becoming successful companies, the students will more often license their inventions to an established company.
“We are equipping our undergraduates with the ability to analyze and prototype any new product,” Hallam said.
In the program, the students learned to work together, negotiate and take a product to market by researching price and competition. Just like a real business, the teams can fire members who are not cooperating or pulling their weight. At mid-semester, industry professionals visit and drill students with questions.
“I think I learned more in the (CITE) program than all my classes combined,” Walker said. “You actually take what they tell you and put it to use. You go through problems and have to figure them out yourself; no one’s going to help you, really. It’s hands on learning is what it is.”
For first place winner Lapara Medical, the future is exciting but still very uncertain. At present, the team needs to raise $330,000 in their first round of funding to start the animal clinical trials for their product. And eventually, they can go to the Food and Drug Administration seeking approval for human trials – a step that will cost them a total of $3.4 million. The team plans to pitch in the first $49,000. It’s a big step for the students, but for now they are just grateful for the opportunity.
“Thanks to UTSA’s CITE competition we get to just go in and just have our own business,” Daufen said.

Geekdom Launches Open Cloud Academy

Geekdom plans to launch the Open Cloud Academy early next year to teach veterans and the public technology skills.
The Open Cloud Academy will be located on the 6th floor of the Weston Centre downtown. Its eight-week classes will begin in the middle of January.
“We’re still working on the plans,” said Nick Longo, director of Geekdom. “It’s very complex when we’re trying to bring in Rackspace, the military, USAA, Red Hat and us.”

Nick Longo, director and co-founder of Geekdom

The Open Cloud Academy will host three simultaneous classes with 15 students per cohort. They will be made up of 75 percent military veterans.
The classes, valued at $6,000 to $15,000, will cost around $500, and instructors will teach the students to become Linux system administrators in coding languages like PHP, Perl, Ruby and Python. At the end, the students will take a test and receive a certificate as a Linux administrator. Linux is the preferred operating system for hosting providers in the cloud.
Geekdom is working in alliance with USAA on the Open Cloud Academy.
The Open Cloud Academy is one of the latest ventures of the year-old Geekdom, a collaborative co-working space, which will be celebrating its one year anniversary at a party a the Weston Centre on Friday.
In the last year, Geekdom has become the largest co-working space in Texas with 500 members, occupying 45,000 square feet at the Weston Centre. It recently expanded to the 10th floor in addition to the 11th floor. And now it’s taking over the 6th floor for the Open Cloud Academy. Geekdom also expanded to a location in San Francisco and is eyeing further expansion into China.
“We offer a space for the country’s brightest entrepreneurs to connect, work and grow,” Longo said in a news release. “Our focus since day one has been simple: to attract talented startup companies to San Antonio with a dynamic space that offers them an opportunity to think and work creatively with the freedom to explore their business ideas with likeminded companies and mentors. In this way, we can stimulate two things: San Antonio’s economic engine and drive entrepreneurs that will create up to 40 percent of all new jobs in the next 20 years.”
So far, Geekdom has held more than 220 tech events including SparkEd, a program that instills leadership skills in middle school kids while teaching about entrepreneurship, robotics, web design and programming during a weekend workshop. Every weekend, 30 kids participate in a two-day program to build, program, market and sell a robot.

Geekdom co-founder and Rackspace Hosting Chairman Graham Weston

Geekdom also hosts 3 Day Startup, Startup Weekend and the annual TechStars Cloud. In addition, Geekdom awards $25,000 to promising startups through its Geekdom Fund. So far it has invested $175,000 in seven startups.
Geekdom co-founder and Rackspace Hosting Chairman Graham Weston called the site a pioneer in San Antonio.
“We created a place for entrepreneurs to inject themselves into a true ecosystem on which they can thrive and take advantage of a powerful network of influencers,” Weston said in a news release. “We want to make San Antonio the “Cloud Capital of the World.” Having a thriving startup community is the foundation of that ecosystem. Our mission to take promising ideas and turn them into fundable ideas is becoming reality faster than any of us could have hoped.”

Geekdom is a sponsor of Silicon Hills News

Webhead Thrives in San Antonio, Moves Into Its Own Building

BY RANDY LANKFORD
Reporter with Silicon Hills News

Janie Gonzalez, founder of Webhead

Even in San Antonio, where Latin culture permeates every aspect of life, some biases can be hard to overcome. Being a woman and of Mexican descent made Janie Gonzalez feel like she already had two strikes against her when she started Webhead.
“There’s an unfortunate belief that certain minorities should stick to mundane jobs they’re stereotyped for,” Gonzalez says. There are also those who don’t believe women are suited to leadership positions in high-tech companies. Gonzalez busts both those myths.
“My personal and business journey as a Latina CEO has been a trying experience with many ups and downs.”
A San Antonio native and UTSA graduate, Gonzalez founded Webhead as a website hosting company in 1994 while still in college. It has since expanded to include cyber-security support, e-commerce system design and a number of digital analysis and advisory services.
“I envisioned the potential the Internet would bring to all areas of business as well as the social impact, especially through the demand for website design and development.
“Our clients look to us for the latest, most cost-effective, online business technology solutions and techniques. We take pride in being pioneers in the Internet world and making a mark on the cyber frontier. Our efforts range from helping our nation with cyber defense to assisting clients with emerging online needs.”
Operating in what Gonzalez describes as a state of “constant innovation,” Webhead has grown considerably in its 18 years of operation. The company will move into its own newly purchased building in 2013 after starting with $500 cash and a $2,500 line of credit at Circuit City.
“No venture capital investment,” says Gonzalez of the company’s organic growth. “One client, sweat equity and many odds against it. We survived three major financial downturns including the burst of the Internet bubble.”
The purchase of Webhead’s own building is, according to Gonzalez, her third career milestone.
“The first was landing my first big account for $3.5 million. It only took 12 years into my career. The second was moving from micro lending to a conventional bank and establishing solid banking relations with a sizable line of credit.”
Gonzalez is using her success to support the community as well through Webhead’s “Get Involved” program focusing on volunteerism, donations, sharing and spotlighting. Webhead employees participating in the program are encouraged to donate at least 20 hours per year to community service focused on medical research, education, military and mentoring.
“I come from humble beginnings and would not be as successful without the support my family and I received growing up. We have a social responsibility to help those less fortunate and contribute to the common good to improve the communities we work, play and live in.”
The drive and desire to make a difference was inspired by Gonzalez’s parents.
“As the oldest of five siblings, it was agonizing to see my parents struggle financially. Growing up, I watched my father labor in his trade as a mechanic to make ends meet. He had no formal education or training and spoke limited English. Despite his situation, he worked tirelessly to see that his family did not lack the basic necessities. I watched and learned. Tired, injured, frustrated he never missed work and still doesn’t. I admire my dad’s character of strength, teamwork, professional appearance and his attitude.
“My mother dedicated herself to her children and husband. She invested in her children’s education, spirituality and community development. She spent every ounce of energy on her children. She was a school volunteer, coordinated talent shows and made sure we participated in extracurricular activities: the Girls Scouts, basketball, track, baseball/softball, dance lessons. She was a domestic entrepreneur. We sold raspas, crafts, and items at the flea market. She did all of those things to pay for all the extracurricular activities. Again, I watched and learned; fatigued yet always with a smile and spirit of giving, not expecting anything back from anyone including her children. I admire my mother’s big heart, her faith, and desire to give to others.”
As for her business success, Gonzalez quotes entertainer Bill Cosby. “In order to succeed, your desire for success must be greater than your fear of failure.”
Webhead is certified as a contractor to the U.S. Government under the Small Business Administration’s 8(a) business development program, as both a woman-owned and a minority-owned small business. The company is certified with both the SBA’s HUBZone neighborhood development project and the equivalent Texas state program.
“The Webhead team did an excellent job of taking our ideas and turning them into a reality,” explains Kathy DeWaal, chairman of NIOSA, in describing Webhead’s Content Management System implementation and web development, custom design, information architecture, mobile site development and maintenance, and Quick Response or QR Code design and development.
“They were very easy to work with, informative, and always accommodated our questions and concerns. They gave us a wonderful new look and made sure we were aware of the steps being taken throughout the design process.”
Gonzalez, who grew up on San Antonio’s south side, chose the location of the company’s headquarters carefully.“Webhead’s office has and will continue to be in the inner city. Economic development cannot take place without employers who provide high-wage occupations. I’ve made a point of giving back to my community by fostering economic development in the inner city.”

Austin Ranks Among the Nation’s Largest Tech Hubs

Julie Huls, president of the Austin Technology Council

Austin lands on a lot of lists for best place to live and work and fittest city.
But Julie Huls, president of the Austin Technology Council, is most excited Austin is being recognized nationally as a leading tech hub in a new economic development report.
The report, Technology Works: Patterns of High-Technology Employment and Wages in the United States, also highlights the Austin-San Antonio corridor as a well-defined center of high tech employment.
“It’s data driven,” Huls said. “It’s not an opinion piece. This is a snapshot of the local technology economy from a national standpoint. It ranks Austin on a national scale. Austin is now being associated with the likes of Silicon Valley, Boston and Seattle.”
ATC partner Engine Advocacy sponsored the study, which was prepared by the Bay Area Council Economic Institute.
“Engine’s report provides an important validation for companies that choose to grow their products in Austin’s unique environment,” Kevin Callahan, MapMyFitness co-founder, said in a news release. “The elements that originally drew talent and capital are still here and Austin’s tech community is determined to create a new, distinct, and competitive tech ecosystem.”
The report highlights the importance of high-tech jobs to regional employment and income.
“Since the dot-com bust reached bottom in early 2004, employment growth in the high-tech sector has outpaced growth in the private sector as a whole by a ratio of 3 to 1. High-tech sector employment has also been more resilient in the recent recession-and-recovery period…. The unemployment rate for the high-tech sector workforce has consistently been far below the rate for the nation as a whole.”
The report also showed that job creation surrounding Science, Technology, Engineering and Math, known as STEM, jobs exceeds all other sectors.
“Employment growth in STEM occupations has consistently been robust throughout the last decade, outpacing job gains across all occupations by a ratio of 27 to 1 between 2002 and 2011.” The report showed growth in all occupations totaled less than a percent, whereas STEM grew 16.2 percent.
In 2011, Austin/Round Rock, with 10.7 percent of its workforce in tech jobs, claimed the No. 14th spot on the list of the top 25 Metros for high tech employment concentration in the country. The U.S. average is 5.6 percent. In comparison, San Jose had nearly 29 percent and Boston had just over 20 percent.
Austin didn’t make the list of the top 25 Metros with the highest growth in their technology workforce because it already had a large pool of high tech workers. But San Antonio made the list. It increased its high-tech workforce by 8.4 percent from 2010 to 2011, compared to the national average of 2.6 percent. From 2006 to 2011, San Antonio has seen nearly a 24 percent increase in its high-tech workforce.
Lastly, Austin has seen its high tech wages rise nearly 5 percent from 2010 to 2011, with an average wage of $101,000. Wages in San Jose, where nearly 29 percent of the jobs are tech, wages rose nearly 6 percent in the same time period and average wages were $170,000, almost $70,000 more than Austin. San Antonio’s average high-tech wage was $74,254 and 5 percent of its workforce have high-tech jobs. The average high-tech wage in Texas was $95,848, about the same as the national average.

Technology Works

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