The Cabstr team: Joshua Schechter, Nick Honegger and Ralph Minderhoud at Trinity University Pitch Night
Two startups sprung forth from Trinity University’s eight-week Tiger Hatchery program.
Cabstr, a ride sharing program aimed at college students and Marco Polo, an RFID-based system to track children, both pitched their companies Thursday night at Trinity University.
Cristal Glangchai, Ph.D., Director, Center for Entrepreneurship and Innovation at Trinity University and 3 Day Startup San Antonio, started the Tiger Hatchery program to give students a chance to pursue their business idea during the summer. Each startup received $5,000 in funding, office space at Geekdom and mentoring from entrepreneurs like Pat Condon, co-founder of Rackspace, Jason Seats, co-founder of Slicehost and Nick Longo, founder of Coffeecup Software and director of Geekdom.
The idea began at 3 Day Startup San Antonio, Glangchai said. The Tiger Hatchery program allowed some of the teams to go on to pursue their ideas.
“It provides an infrastructure and set timeframe for startups to work on their project,” she said.
Cabstr plans to launch its service shortly, said Joshua Schechter, one of the founders along with Nick Honegger and Ralph Minderhoud. They all met at 3 Day Startup and their company won the competition.
Cabstr currently is working with two of the city’s major cab companies, Minderhoud said.
“We see this as a complementary product not a competitive product to the cab companies,” Honegger said.
Cabstr provides a way for college students to share cabs by using Cabstr bucks or a prepaid account. A student can post that they want to share a cab to a mall, restaurant, airport or any other venue and see if other students want to hop in the cab with them. They have up until 40 minutes before the scheduled departure to cancel the cab. The idea is that by sharing the cab fare with others, they all save money and get to ride to places with their friends. The site makes money by taking a transactional fee on each ride and through sponsorships and advertising, Schechter said.
Cabstr plans to launch initially at four San Antonio universities: Trinity, St. Mary’s, University of Texas at San Antonio and Incarnate Word. The service will then expand statewide and then eventually to other cities and states, Honegger said.
The biggest inhibiting factor preventing students from taking more cab rides right now is cost, Honegger said.
“I can’t afford to go to the mall to buy shoes, if my cab rides are going to cost more than my shoes,” he said.
Cabstr offers a solution to students who want to explore the city beyond their campus, Minderhoud said.
“Everybody’s on campus and they do have the habit of sharing rides,” he said. “We’re just changing who is driving.”
Cabstr plans to approach parents to set up an account for their child so the students can simply log on, arrange a ride and spend their Cabstr bucks.
Pat Condon served as a mentor to Cabstr and likes the idea.
“I remember when I was a college student,” he said. “You end up getting stuck in your bubble on campus and it’s tough to get out.”
Cabstr lets the students safely explore the city with others from their university and that makes it appealing, Condon said.
“Nobody wants to get in a cab with a creep,” he said. “This takes that creep factor away. Everyone’s starting from the same place and they’re all students. There is a built-in safety net.”
The other benefit is that students pay for the cab ride through their Cabstr accounts online. Everything is taken care of by the time they get in the cab.
“The real magic is money doesn’t have to change hands for the experience,” Condon said.
The other startup, Marco Polo is working on a wireless system to help parents, teachers and childcare workers keep tabs on children in public places, said Leon Dacbert, one of the founders. Ernest Aguillon is the other co-founder. They plan to continue working on the project and hope to eventually land some angel funding to take it to market, Dacbert said.
He’s told the story numerous times but it never makes it into print: Hugh Forrest became director of South by Southwest Interactive—possibly the largest entrepreneurial conference in the world—because he owned a computer.
When he got the gig, in 1988, SXSW was a brand-new music festival, Forrest was a newspaper publisher and the digital revolution wasn’t even a glint in anyone’s eye. Forrest, an Austin native and English major from Kenyon College in Gambier, Ohio, had started an alternative newspaper in town, The Austin Challenger.
“The most alternative thing about it was the publishing schedule,” he quips.
He’d started the paper several years before, burning through borrowed money when his father—his primary investor—convinced him that his typesetting costs were killing him and he needed to get a computer. Forrest bought a MacPlus, a LaserWriter Plus and Pagemaker 1.0 and managed to keep the paper alive, despite competition from its friendly rival, The Austin Chronicle.
Then in 1988, Nick Barbaro of The Chronicle decided that with nearly a thousand SXSW registrants, the event needed a computer. And Forrest had one.
“I originally got hired because I had a computer and they didn’t,” Forrest said. “So I was the tech person. And seven years later when they launched multimedia (Interactive) everybody said ‘He knows computers because he has one. So he should head up this thing.’ “
And that’s how Hugh Forrest became director of a conference that has grown like some geek teenager on steroids. What was once the red-haired stepchild of SXSW Music and Film has outpaced both, fueled by the digital revolution. It covers 15 campuses, about a thousand panels and tens of thousands of attendees. Not to mention the parties.
Forrest—who has a liberal arts background–always envisioned the event as a place where a diverse community of creative people from various disciplines could cross-pollinate and birth new ideas, solutions, inventions and relationships. It wasn’t about how a specific technology worked or the latest computer language. He wanted a big-ass salon where geeks and philanthropists, entrepreneurs and artists, social media experts and musicians could create the tools and systems that solve our problems and fuel our dreams in the future. And where they could meet and build meaningful relationships, a community. Like TED, only less expensive, so the technorati who have yet to be discovered could afford to attend.
“That was one of the original weaknesses of the event,” he recalled. “People would say ‘What are you?’” And his response was “We’re a little bit of everything.”
But, as the event outgrew first the Convention Center then other venues, it became tougher to sustain that vision. More and more campuses were added to accommodate the crowds and people tended to hunker down in one spot with their tribes: tech people with tech people, non-profits with non-profits and so forth. That put the kibosh on the cross pollination and forging of relationships across industries. Also as the attendance grew, the number of panels swelled and some people complained the quality dropped…a lot. At the same time, various interest groups started imposing their own agendas on the event. Investors sought the next Facebook, startups hoped to get discovered, companies hoped to launch the next Twitter.
SXSW Interactive Opening Party 2012 — Credit: JoJo Marion, courtesy of SXSW
And then there were the parties.
Some veterans of the event complain that it has gotten too big, that the panels suck, that it costs too much or that it should cost more to restrict the size. They complain it’s more of a networking event than a learning experience, that all the good stuff happens in the side events where you don’t need a badge to get in, that the side events are a parasite on the main event and—a common refrain in Austin —that it’s not as good as it used to be.
Victim of Its Own Success
Forrest is familiar with all the criticism and issues surrounding the event. He has watched the number of panels swell and wants to bring the number down for 2013 with the emphasis on quality, not quantity. A few years ago, he introduced the Panel Picker model in which people can propose sessions and SXSW participants vote on which ones they would like to attend. The problem is, many people canvass their friends to vote for them, making the Panel Picker process more a popularity contest than a pitch for interesting ideas. But he’d also like to get to the place where the conference organizers can work with panelists beforehand to ensure a top notch presentation.
“One event I would compare this to is TED. The bottom line for the two events is very similar: They draw people who are very smart, very creative and interested in different ideas. Ours tends to be very open source and particularly with the Panel Picker model, once you’ve been accepted to speak much of the onus falls on the person who has proposed the panel in the first place. What TED does really well is to curate a lot of their content and really work with their speakers…each one gets 40 hours of training. We don’t have that kind of bandwidth. So some presentations are really, really great and some that seem like they’ll be great don’t put the time in beforehand.”
2012 SXSWi Featured Speakers Al Gore & Sean Parker — Credit: Heather Kennedy, courtesy of SXSW
In 2012, he said, SXSW had more than 1,000 events including the panels and meetups. He’d like to reduce that to 550 panels and about 300 meetups and mentor sessions for 2013 to make handholding easier.
But another reason people might find panels disappointing, Forrest said, is that they only go to presentations within their own campuses and disciplines. Instead of being exposed to new ideas from all different disciplines, they’re only learning what the brightest minds in their own arenas have to say—insights they probably already knew about.
Forrest tries to get people to mix it up a little panel-wise. “I tend to encourage people to go to sessions they don’t know anything about,” Forrest says. “If you’re a social media expert, go to the panels on transforming the health industry, or sessions on government and technology, something slightly out of your wheel house. “
Susan Davenport, Senior Vice President of Global Technology Strategies for the Chamber of Commerce pointed out that, among people making SXSW Interactive a priority event are thought leaders, investors and companies doing new releases (hoping to be the next Twitter or Foursquare) as well as federal officials and health care executives. Their interests are multi-dimensional and often cross from one sector to another.
“The lines are blurring,” she said. “For example people are studying technologies to move healthcare forward, how will sensor technology impact life sciences? It’s where biology meets technology. Then there’s clean tech and gaming and various pieces of that find their way into many different sectors.”
But, Forrest points out, human nature is such that people tend to respond to such a giant event by sticking with their friends and their industry. If all your friends are checking into one event on Foursquare, that may be where you head, instead of to another event where you might meet new people in an unfamiliar industry. Individuals have to make a decision to step out of their comfort zones to get the most from the event.
“I think (Forrest) is doing really a great job of managing SXSW, but in a way, it’s a victim of its own success” said Josh Baer, founder of the Capital Factory. “You have to do things to break it up and make it manageable but you do lose the cross pollination….
Things in life are either getting bigger or they’re getting smaller; getting better or getting worse. What you can’t do is keep everything exactly the same. Then it would stagnate and that wouldn’t be good either.”
Still, Forrest hopes to keep on top of the growth and make the event more navigable. With so many people and sessions, he said, it can be difficult to find the people you want to meet and make a meaningful one-on-one connection.
“Whether that person becomes a friend or you end up making business with them or they’re just someone you can call up and they’ll tell you the best restaurant to go to …those one-on-one relationships are one of the most important things to come out of SXSW. A lot of people come to the event and say, ‘Hey, I met this person and they were directly responsible for me getting this new job or they inspired me or changed my viewpoint on this issue….
Startup Village
Another aspect of human nature that Forrest and his team of 20 must contend with is our attraction to things that glitter. He does a poor job of masking his frustration with the fact that startups threaten to swallow the event.
SXSW Interactive Awards 2012 Breakout Digital Trend Winner Ben Silberman of Pinterest — Credit: Michael Cummings, courtesy SXSW
“Startups are a big driver in the U.S. and international economies at this point,” Forrest says. “There’s an energy, a vibrancy, a robustness around startups. Our addition of startup stuff was one of the big drivers of our continued growth…. But what is to some degree concerning is that startups are so sexy and intoxicating I worry they will overshadow other things we do.”
Last year’s introduction of Start-Up Village, on the fourth floor of the Hyatt Hotel was enormously successful. So successful, Baer points out, that if it hadn’t been at SXSW, it would have been its own huge event. And that’s what Forrest worries about. “What happens if the startup economy completely craters? I’m not saying that will happen but we don’t want to put all our eggs in one basket. We want many different things going on.”
Managing Crazy Growth
On the other hand, one of the many different things that go on include extra-SXSW events that piggyback off the success of the conference. One of the hot political issues of SXSW is dealing with the parties and meetings staged around the event that don’t require badges. Forrest said he would prefer to pull all of those into the main event. But they are a natural byproduct of an event as large as SXSW. And however many are pulled in, more are likely to spring up.
“One of our biggest challenges is to create a structure that continues to foster the kind of growth we want to see as we move forward,” Forrest said.
“Just by seeing the kinds of ideas in the Panel Picker serves as barometers where the industry is,” he said. “The biggest single category is entrepreneurialism and business. There’s so much interest excitement, momentum in the startup space and that’s good. By comparison, one thing we added this year to the Panel Picker was science and space exploration. … A lot of the entries in that category are very, very exciting. There’s lots of stuff about space exploration, big data, mobile, gamefication….”
Some people have argued that, with the conference’s success, they have the clout to invite CEOs from huge tech companies to speak. But that defeats an idea that Forrest loves that—as one attendee commented—SXSW is where he goes to see what will be big two years from now. It’s the birthplace of new ideas, not the celebration of institutions.
While he is passionate about that idea, he has also struggled to learn to delegate to his growing team, Forrest said.
“I don’t want to just be representative of the tech companies. I want to create an ideal world within SXSW where you don’t have to necessarily agree with everyone. The more different ideas you can bring into the event the stronger it becomes. We have to talk all these things out. ‘Hey, here’s the Blank Blank who wants to talk this year. ‘We have to decide, would that push us too much in one direction?”
“We’re not the stars of the show,” he said, referring to himself and his staff. “The stars of the show are the creative people who come to Austin in March and the creativity of the community that makes the event what it is. The organizers try to pull the pieces together. In some places we’ve done a great job and in other cases we didn’t make the right moves.”
On the other hand, the team has created a huge success, for an English major with a computer.
“I always had this idea that I would never do any job for more than four years,” he said. “I thought it was important to move on and test myself. Having done this approximately 20 years, some days I think I would like to challenge myself in other ways; go back to writing more. I do think that when I do step down, hopefully it will survive and thrive and prosper. It’s the community that pushes this thing. There are so many people in the community who care so passionately about this event.”
Editor’s note: WeAreAustinTech.com recently featured an interview with Hugh Forrest in its weekly series of video releases on Austin-area technology visionaries. With their permission, I’ve posted the video below.
Vid Luther started Zippykid in 2010 to meet a need for dedicated hosting of WordPress sites.
The San Antonio-based startup has quickly grown. It now occupies one of the largest offices at Geekdom and has nine employees. During a recent meeting, Luther proudly showed off one of the company’s latest coups: healthcare benefits from Blue Cross.
Zippykid is the kind of high-tech startup that San Antonio technology leaders hope to incubate by the dozens at Geekdom, a new collaborative coworking space at the Weston Centre in downtown San Antonio. For more on Zippykid, check out this Q&A I did with Luther almost a year ago. A lot has changed since then.
500 Startups recently invested in Zippykid. The company has received additional funds from Geekdom and several angel investors including Slicehost Founder Jason Seats and Rackspace Co-Founder Pat Condon. That money has enabled Zippykid to hire additional employees and re-architect its services.
Among its new features, Zippykid reports it takes less than five seconds to get a site deployed with them. It’s also offering free hosting with no credit card required. As long as the site doesn’t get more than 5,000 page views a month, it’s free. The site gets the same support including malware scanning and removal, the managed upgrades, patches and backups.
Since Zippykid launched the free hosting earlier this month it has been getting more than 100 new sites a day, Luther said. Zippykid has also beefed up its security to keep hackers at bay.
For more information check out WPCandy, which has written this post with a thorough discussion of Zippykid’s new features.
SecureNet Payment Systems has opened a new technology and innovation center in Austin and plans to hire 200 new employees in the next year.
The company also plans to open a client operations center in Silicon Valley later this year.
SecureNet reports that it has more than 14,000 merchants and $12 billion in annual processing volume.
“Austin and Silicon Valley are a perfect fit for SecureNet’s future as they are home to top technology talent, are both renowned entrepreneurial centers situated near some existing clients as well as prospects; and move us closer toward being a dominant player in the payment technology market,” Brent Warrington, CEO of SecureNet said in a statement.
SecureNet recently raised $18 million with Sterling Partners leading the investment.
The online marketing and advertising firm, Yodle, announced Monday that it The Internet marketing and advertising firm, Yodle, announced Monday that it has moved into a new 100,000 square foot office in Austin and plans to hire nearly 400 more employees.
The company moved into a building at 12234B North Interstate 35 and plans to almost double its current workforce of 350 employees to 750 employees over the next five years.
“Yodle’s expansion adds to the growing list of innovative technology companies that have chosen to make a significant investment in Austin,” Austin Mayor Lee Leffingwell said in a statement.
Yodle acquired ProfitFuel, a search engine optimization firm, in Austin in May of 2011. The company, with offices in New York, Boston, Charlotte, and Scottsdale, has since doubled the number of employees at its Austin office. The company plans to add new jobs in sales and client services as well as tech, human resources and marketing operations.
“Yodle’s operations in Austin have already grown significantly over the last year,” Yodle CEO Court Cunningham said in a statement. “We’ve chosen to accelerate our expansion in Austin because of the deep talent pool, innovative culture, and ideal economic environment that the city offers. Making this investment in Austin will further enable Yodle to put itself at the forefront of the fast growing and sizeable local online marketing space.”
Yodle handles online advertising and marketing for more than 30,000 small businesses nationwide.
“We know that you can’t be pro-business unless you’re pro-education,” San Antonio Mayor Julian Castro at the Democratic National Convention.
To innovate and prosper, San Antonio needs an educated workforce.
That sentiment permeated Discovery SA: The City of Innovation panel Wednesday morning at the Henry B. Gonzalez Convention Center.
Yet despite the focus on innovation, the panelists acknowledged that city, educational and business leaders face huge hurdles in preparing San Antonio’s workforce for the innovation jobs that now drive the economy. They spoke at the Greater San Antonio Chamber of Commerce’s economic outlook conference.
San Antonio’s high school dropout rate is around 27 percent and higher in some schools districts such as San Antonio Independent School District.
Only 24 percent of San Antonio adults have a bachelor’s degree or higher, lagging far behind Austin, which reports 44 percent of adults with a college degree, according to the 2010 U.S. Census.
Just last week, General Motors cited Austin’s workforce of information technology professionals as the main driver in its decision to open an innovation center there and hire up to 500 workers.
So what can San Antonio do to compete?
Nick Longo, director of Geekdom, a collaborative coworking space that nurtures high-tech startups and an education center downtown, thinks the focus should be on seventh and eighth grade students. And not the self motivated kids but the ones who are at the greatest risk of dropping out.
To help them succeed, Geekdom has launched SparkEd, a program aimed at middle school kids at 30 of the worst performing city schools. During the SparkEd program, those kids will join a team, build a robot and create a website and sell it.
“We want to make geeks into rock stars,” Longo said.
But first he needs to make the kids into geeks. SparkEd seeks to do that through a series of weekend workshops with the kids and mentors from local high-tech companies.
Longo envisions teaching kids skills they need to become the “blacksmiths” of the Internet. He says San Antonio, with Rackspace Hosting, has a stronghold in the cloud computing industry, which provides the plumbing of the Internet. Kids don’t need a college degree to become the electricians and plumbers of the Internet, Longo said. But they do need exposure to the right tools, the right training and the right mentors to learn the high-tech trade, he said. That’s the void Geekdom seeks to fill. Fast Company just published an article detailing the goals of Geekdom, founded by Longo and Rackspace Chairman Graham Weston.
Another panelist, Mir Imran, founder of InCube Labs, a biotech incubator, also wants to tackle San Antonio’s dropout problem by targeting 6th to 12th graders in the San Antonio ISD. He’s forming a nonprofit organization to teach innovation to the students through a set of courses.
Imran, who has five children, thinks innovation can be taught to the city’s most at-risk of dropping out children and can motivate them to stay in school.
It’s important not to beat up on the city’s teachers, but to support them and give them the help they need to help the kids succeed, said Jim Brazell, founder of Ventureramp.
San Antonio has a history of innovation in the aerospace, computer and biotechnology industries, Brazell said. He details that history in the San Antonio Heart of Innovation website.
Central Texas could be one of the nation’s next big technology hubs if Austin and San Antonio tech leaders worked together, Brazell said. But the region’s leaders act provincially and that’s a major roadblock to innovation in the face of global competition, he said.
The lack of venture capital in San Antonio also poses a problem in igniting the city’s startup economy, said Imran with InCube Labs. Silicon Valley has more than 500 venture capital firms and countless angel investors. San Antonio has no venture capital firms. The city has tremendous wealth but potential investors are risk averse when it comes to technology and biotechnology, Imran said.
“Instead of 10 startups a year in San Antonio, there should be hundreds of startups,” he said.
CNNMoney, a service of CNN, Fortune and Money, reports that Rackspace Hosting ranks at number No. 67 on Fortune’s list of the country’s fastest growing companies.
Rackspace had three-year revenue growth of 25 percent and profit growth of 45 percent, according to Fortune. Rackspace reported revenue of $1 billion in 2011 and profits of $86 million. Overall, 11 Texas companies made the list. Rackspace was the only one from San Antonio. Cirrus Logic in Austin ranked second on the list. SolarWinds ranked 76 and Rush Enterprises in New Braunfels ranked 95.
Graham Weston, chairman of Rackspace Hosting, gives a brief overview of the company in this ad for Cadillac Spirit of Innovation. Nick Longo, director of Geekdom, a collaborative coworking space downtown, is shooting an ad for the Cadillac innovation campaign next week.
Car giant General Motors announced today plans to hire 500 people for a new Information Technology Innovation Center in Austin.
The Detroit auto maker is looking for software developers, project managers, database experts, business analyts and other IT workers to staff its new center.
The center is “intended to drive breakthrough ideas into GM vehicles and business processes globally.”
“We want IT to keep up with the imagination of our GM business partners, and to do that, we plan to rebalance the employment model over the next three years so that the majority of our IT work is done by GM employees focused on extending new capabilities that further enable our business,” GM Chief Information Officer Randy Mott said in a news release.
General Motors chose Austin because the city “already has people with the skills GM is seeking – 46,000, according to the May 2011 Bureau of Labor Statistics Occupational Employment Report.”
One of the first recipients of the Geekdom Fund is Grapevine in San Antonio.
Geekdom announced the news Friday morning.
“This allows us to buy Ramen at the very least,” said Richard Ortega, one of Grapevine’s founders. “It gives us the opportunity to have enough wind at our back to fully dive deep into the product and idea.”
This allows Grapevine to take the company to the next level, Ortega said. The company plans to target the funding at new client acquisition in the food and beverage industry, Ortega said.
“We really appreciate the ability to grow and excel that being at Geekdom provides us and we’re thankful to the fund for giving us this runway,” said Erik Larson, founder of Grapevine.
The company, founded last year by Ortega and Larson, is a reputation management system right now targeted at restaurants and hotels. The site aggregates customer reviews from several different sites including Yelp, OpenTable, UrbanSpoon, GoogleLocal, CitySearch, InsiderPages and YellowPages and then sends an email alert to the restaurant or hotel manager.
The goal is to cut down the time that hospitality managers have to spend culling the Internet for information from customers. Grapevine also wants to help restaurant and hotel owners improve customer service by responding to customers in a timely manner.
The Grapevine service is for any industry that wants to provide better customer service. The startup just initially targeted the hospitality industry since Ortega has a background in hotel management.
Last week the members of the Geekdom Fund’s review board met with six startup companies applying for $25,000 in financing. They chose Grapevine, which has an office at Geekdom. Earlier this week, Grapevine’s founders presented at the inaugural San Antonio New Tech meetup. The Geekdom Fund provides $25,000 equity investments and gives startups office space. The fund has the ability to invest in many startups, according to Nick Longo, director of Geekdom. So far, the fund has also invested in ZippyKid and Embarkly, which are both based at Geekdom. A condition of receiving the investment is the startup founders must be a member of Geekdom and they must set up an office there.
