David Hooper of Minimus Spine Talks about His New Startup
What is your background?
I went to Case Western Reserve University and then the University of Iowa for a Ph.D. in Biomedical Engineering. My dissertation was on spinal mechanics and I was fortunate enough to have Dr. Vijay Goel as my advisor and Dr. Jim Weinstein on my review committee. I spent three years in England setting up a biomechanics lab and evaluating patients after knee reconstruction. From there I came to Austin and took a position at Spinal Concepts in 1999. That was a fantastic entrepreneurial company and we did really well. When I got there, there were about 30 people and under $10M in sales. We built the company to about $80M in sales and sold to Abbott Labs in 2003. I left Abbott in 2006 and started this later in the year. Several of the physicians and executives I worked with at Spinal Concepts have invested money in Minimus and helped get the idea off the ground.
What was your primary job?
I was Abbott Spine’s VP of Emerging Technologies. In that capacity I was responsible for our Class 3 product development (non-fusion devices) and involved in identifying technology for potential acquisition or investment. I was the company’s liaison with FDA and responsible for designing clinical trials and preparing regulatory submissions. I worked with physician investigators around the country and had a team of engineers, research monitors and data managers to execute clinical trials and regulatory specialists to participate on design teams and prepare FDA submissions.
Why is there so much activity in the spinal area?
A great deal of money has been invested in spine because these patients need devices that improve their quality of life. The market is moving towards minimally invasive surgery and non-fusion but the outcomes still aren’t as good as with hips or knees. Opportunity breeds innovation.
Many of the products are relatively inexpensive to design and build and can be sold with good margins. Over the last few years, some of the regulatory hurdles have been eased- specifically with devices known as fusion cages. Since 1996- at least four companies completed clinical trials on cages and they made a great deal of money. Many other companies tried to do clinical trials but struggled with enrolling them- so no approvals. FDA down classified cages a couple years ago from Class 3 to Class 2, meaning that clinical studies are no longer required. Since then, there is a host of companies fighting for their piece of the pie and competition is fierce.
Artificial discs have been hot because the market started turning away from using cages as stand alone devices and the idea of maintain motion is appealing. Just like cages, the first disc companies getting through FDA trials were handsomely rewarded but later entrants have struggled with enrollment. These disc devices haven’t yet met expectations because it’s debatable whether or not they actually improve patient care, they introduce new risks- and they are expensive. Products like that are going to struggle in today’s health care environment.
One recent problem in spine is that many of the new technologies look very similar to one another. There was clearly a herd mentality surrounding artificial discs. Spine still has great potential but the products that will be successful must be differentiated, have clinical data showing they really do improve patient care- and ideally- save the health care system money. Minimus hits on all these fronts and that’s what compelled me to start the company.
What exactly is your proposed technique at Minimus Spine?
We’re working on a procedure for injecting ozone gas into a herniated spinal disc. There’s a stack of peer-reviewed literature about an inch thick that describes this technique. It’s being done every day in Europe, Asia and South America. The gas oxidizes the herniation and allows it to shrink in size, relieves pressure on the nerve and provides the patient relief from pain. Contrast that to steroids. Steroids address inflammation of the nerve but do not address the herniation. That’s why patients often have multiple injections and many go on to surgery. I believe Minimus can effectively treat patients with just one injection and reduce the number of patients that progress to surgery.
Why isn’t this available in the U.S?
The main reason that this isn’t available in the U.S. is because there is no regulatory approval. It takes a significant investment to go through the FDA and the technology has needed a better business model to justify that investment. We have the model figured out and once we go through the FDA process we would be the only injection treatment available- except for steroids which don’t’ work that well and don’t have FDA approval for spinal indications.
Our device is quite different from those being used overseas. We’ve been able to make improvements that should position us well with the FDA. Some of our angel investors are clinicians in Europe and the Middle East who are already using ozone. They feel that our patent-pending designs will revolutionize the existing market- particularly once we have FDA approval.
How long does the effect of your procedure last?
One of our surgeon advisors has been tracking a group of almost 100 patients he treated in 2002. In that group, only 15% of the patients went on surgery within 5 years, which is about half of those who receive steroids. Less than 2% were given a second injection, which is much better than steroids where the average is 2.5 injections per patient. If Minimus can cut the number of injections and the number of surgeries then we’re in great position because it’s better for patients and saves money.
Do you need a new code for reimbursement code for this procedure?
No, there’s an existing code we can use. There was a product released in the 1980s called chymopapain that was used in a manner similar to what we want to do with ozone. Chymopapain is an enzyme derived from the papaya plant. The product was hugely popular but there were a small number of well-publicized adverse events that caused the product to crash. Basically, the enzyme isn’t specific to the disc material. If it leaked out of the disc or was mistakenly injected into nerves, the enzyme could dissolve the nerve and leave the patient paralyzed. There were also some people who had an allergic reaction to the protein and died. Some clinicians still use chymopapain outside the U.S. but its not available here. Not that many doctors want to take the litigation risk. None of these problems have been reported with ozone.
Is there a patent on this technique?
They started injecting ozone into herniated discs in Italy over 15 years ago. It’s in the public domain. We have filed four patents on our product and believe that these patents will make it difficult for others to create a profitable product that can meet FDA standards.
The other aspect of intellectual property is the clinical data and regulatory approval. Some people have a misconception that once one company does a study and gets FDA approval, any future competitor can design a similar product and FDA will approve it without them having to do their own study. That’s just not true. Again, fusion cages are a prime example. It was over ten years between the first product to get regulatory approval and the eventual down classification. History has proven that the value of these approvals is great because it is always much more difficult to complete a study once there is already a product on the market. If you were a patient and Minimus had approval today, would you opt to take the FDA approved product or enroll in a study of another ozone product? Most patients will take the FDA approved product because there’s no need to take a risk on an unproven product. Likewise, most doctors will chose to use the FDA approved product because its not worth their time and energy to do an FDA clinical study. That generally holds true unless the new product is believed to be significantly better.
I’ve always said, patents are great but they are worthless if your product isn’t on the market. The spine industry changes so quickly, I believe there is just as much value in FDA approval and being early to market.
Wednesday, December 3, 2008
Wednesday, November 26, 2008
Henrik Johansson of Boundless Networks Talks about the Early Days
Boundless Network was recently named the second fastest growing company in Austin by Austin Business Journal and named the No 6 among “Best Places to Work” by the industry magazine The Counselor. I talked to Henrik Johansson, one of the founders and the COO of Boundless Network.
What does Boundless Network do?
We’re a technology-enabled services company that provide promotional products solutions to corporate customers.
What are you working on these days at Boundless Networks?
The first couple of years we were focused on growing almost exclusively through recruiting of industry salespeople and then helping those salespeople deliver value to their customers. We spent a lot of time and effort on developing a fully scalable back-office system that could handle our rapid expansion. Now we’ve evolved our technology platform to the point where it really delivers unique value to our customers, and that is increasingly starting to drive our growth .
What do you use on the backend?
We selected the Lombardi workflow product TeamWorks and have used it to streamline our supply chain and orders process. It is the foundation for the engine that is managing all the custom order needs and coordinating the activities in our supply chain. We also have invested heavily in Salesforce.com as our CRM and marketing engine and customized it to our industry. I have been impressed with Salesforce.com so far as they have really opened up their back end to external applications which have made it useful for so much more than just CRM.
Who funded you guys?
Initially we raised about a $1M from angel investors in town which converted into our Series A of $3 million from Austin Ventures and Silverton Partners. Later we raised $4M in Series B from those same firms. They have both been great partners to us. In an industry largely void of outside capital, having strong financial partners is a competitive advantage.
What did you do before Boundless Networks?
I co-founded my first startup Creditland in the Bay area in the late nineties. It was a lending marketplace and we partnered with many of the biggest banks in the US and provided them online credit approval capability. We used a heavy duty decision engine on the back end. After that I was recruited to another online financial services company in Austin called EverydayWealth. We built an online financial planning application, and grew quickly by signing up members through a network referral model.
You’re originally from Sweden. So how did you come to Austin?
I started as a management consultant with Andersen Consulting (now Accenture) in Stockholm, and got happily stuck here after a project in Dallas. I met my wife-to-be there and we moved to San Francisco where we stayed for about 6 years, before we decided to come back to Texas about 7 years ago, and then Austin was the only option. We love it here.
Best regards,
Hall T.
What does Boundless Network do?
We’re a technology-enabled services company that provide promotional products solutions to corporate customers.
What are you working on these days at Boundless Networks?
The first couple of years we were focused on growing almost exclusively through recruiting of industry salespeople and then helping those salespeople deliver value to their customers. We spent a lot of time and effort on developing a fully scalable back-office system that could handle our rapid expansion. Now we’ve evolved our technology platform to the point where it really delivers unique value to our customers, and that is increasingly starting to drive our growth .
What do you use on the backend?
We selected the Lombardi workflow product TeamWorks and have used it to streamline our supply chain and orders process. It is the foundation for the engine that is managing all the custom order needs and coordinating the activities in our supply chain. We also have invested heavily in Salesforce.com as our CRM and marketing engine and customized it to our industry. I have been impressed with Salesforce.com so far as they have really opened up their back end to external applications which have made it useful for so much more than just CRM.
Who funded you guys?
Initially we raised about a $1M from angel investors in town which converted into our Series A of $3 million from Austin Ventures and Silverton Partners. Later we raised $4M in Series B from those same firms. They have both been great partners to us. In an industry largely void of outside capital, having strong financial partners is a competitive advantage.
What did you do before Boundless Networks?
I co-founded my first startup Creditland in the Bay area in the late nineties. It was a lending marketplace and we partnered with many of the biggest banks in the US and provided them online credit approval capability. We used a heavy duty decision engine on the back end. After that I was recruited to another online financial services company in Austin called EverydayWealth. We built an online financial planning application, and grew quickly by signing up members through a network referral model.
You’re originally from Sweden. So how did you come to Austin?
I started as a management consultant with Andersen Consulting (now Accenture) in Stockholm, and got happily stuck here after a project in Dallas. I met my wife-to-be there and we moved to San Francisco where we stayed for about 6 years, before we decided to come back to Texas about 7 years ago, and then Austin was the only option. We love it here.
Best regards,
Hall T.
Monday, November 24, 2008
Scott Shane’s new Book "Fool’s Gold" Dispels Many Myths around Angel Investing
I found the book Fool’s Gold insightful as it confirmed many of my assumptions about angel investing such as:
1. Most angel investing is done alone by individuals who are supporting a family or a friend and in such cases treats their investment more as a donation.
2. The majority of these investments don’t come with due diligence, terms, or other basic investment supports.
3. Most never see a return.
4. Most cannot help the company they invest in because they don’t know enough about the industry or the company.
As a director of any angel group I encourage people to join for education and deal flow. An angel can spend all day finding the deals but then must spend all night investigating those deals. I had the chance to speak with Scott Shane the author of Fool’s Gold.
In your chapter on why people do angel investing you list several factors such as to make money, to help the community, and more. Which factor do you think will be the driving force of angel investing in the coming years?
I think that it is to help the community. With a slow IPO market, a lot of acquirers slowing down their operations, and general economic malaise, I don't think the next couple of years will be the golden age for angel investments. I think the people who will do this and be happy with it in the next few years are the ones doing it to give back or to stay involved with startups.
I understand angel investing in total is just a little larger than VC investing. Within angel investing, family and friends money outweighs angel group funding by a factor of 13 to 1. What can angel groups do to support the "family/friends" money effort short of having them join the angel group?
I don't know that there is much angels can do to support the friends and family money. I think the best thing to do is to stop thinking in terms of this financing lifecycle model where the entrepreneur puts in money, gets money from F&F and then angels and then VCs. Very few of the businesses that get F&F money are appropriate for angels. So rather than supporting the F&F money effort, I think the issue is to figure out which F&F money is the end of the financing money and which is in companies that seek further rounds. You want to separate out those
for whom the F&F is a stage rather than an end.
You mention that only 5.9% of companies started each reach "gazelle" growth rates of 20% or more per year? Aside from industry is there any data that indicates which companies will grow that fast?
There is. Founder experience, IP protection, business strategy are a few. But none of this is for angels in specific. The study that needs to be done and that I have wanted to do for years because it would be so helpful is to look at all the deals that go into angels. The deals would be tracked and we could see what leads to higher performance. This approach is specific to angel deals and therefore
of great relevance to angels. Moreover, it can tell you if angels are picking winners or losers.
You write about the importance of "staging" funding for angel investments. What more can you tell us about that?
Angels generally think in terms of putting in money in one block and that's it. Staging, putting money in over time with milestones is a better way to monitor companies. So angels should think about how much time it will take to achieve a company's goal - say get the product on the market. Then they should create milestones to get there and give out money on achievement of the milestones. This is essentially the VC way and seems to be done by sophisticated angels,
but not all.
You indicate that angels receive 1.7x on their investment but that the data is hard to judge without time frames. If you separate out the family and friends money which is more a donation than an investment - what multiple would you expect to see?
I don't have the data to look at actual returns by typical angels. The book gives numbers on actual returns for angel group members, expected returns by typical angels, and actual returns by all informal investors. In general, I would say that we can infer that the typical angel neither has the return expectations nor the returns talked about by sophisticated angels in groups.
You indicate that financially successful angels look at the industry of a company to determine its potential value. You show a list of valuations for six-year old companies by industry and they range in valuations. Does this correlate to the maturity cycle of the industry? What other factors drive it?
That's a book in itself. Industry maturity, the nature of production, IP protection, firm size, and a host of other things drive the numbers. The purpose of the chart was to say industry matters and angels need to pay attention to that. They should investigate why industries are attractive or not.
You conclude that state tax policies aren't that helpful and the most practical support the government can provide is to foster the growth in the number of angel groups? Why?
Angel groups allow you to get people involved in investing in start-ups who have lower net worth. That enhances the pool of angel capital and gets the novices working with and learning from the experts. While everyone likes a subsidy, the state tax policies don't seem to actually move many non-investors into the investor categories because state tax rates aren't that high. So taxes aren't as effective. If the federal government created an angel tax credit that might be
different.
How would you encourage the investors to join an angel group?
I would suggest groups go out and look for accredited investors and try to bring them into the group. I would also encourage government programs to get these groups started. There is a bunch of effort that needs to happen in the beginning for which subsidies help and get paid off later.
How do you see the current economic climate impacting angel investing?
It's hurting. Angels invest their own money. They have to limit that to a portion of their net worth. If their net worth drops by one third, the amount of money for angel activity, on average, goes down a third. The only silver lining in this is that people might be allocating a greater portion of their wealth to angel investments. If they are going to lose a lot in relatively low risk low return activities like public equities, they might as well risk losing money for a big winner in a start up.
You list Austin as a good place for angel investing since the number of firms receiving external equity per million population actually puts Austin above San Jose? What should a city like Austin consider doing to improve its position here?
Focus efforts on building and maintaining angel groups. The system is working in Austin. So it is a matter of maintaining the top position. That means keeping the angel groups going. That's the thing under your control. You can't make new entrepreneurs emerge or new technologies be born. But you can make sure that the system stays there for financing them once they are born.
Best regards,
Hall T.
1. Most angel investing is done alone by individuals who are supporting a family or a friend and in such cases treats their investment more as a donation.
2. The majority of these investments don’t come with due diligence, terms, or other basic investment supports.
3. Most never see a return.
4. Most cannot help the company they invest in because they don’t know enough about the industry or the company.
As a director of any angel group I encourage people to join for education and deal flow. An angel can spend all day finding the deals but then must spend all night investigating those deals. I had the chance to speak with Scott Shane the author of Fool’s Gold.
In your chapter on why people do angel investing you list several factors such as to make money, to help the community, and more. Which factor do you think will be the driving force of angel investing in the coming years?
I think that it is to help the community. With a slow IPO market, a lot of acquirers slowing down their operations, and general economic malaise, I don't think the next couple of years will be the golden age for angel investments. I think the people who will do this and be happy with it in the next few years are the ones doing it to give back or to stay involved with startups.
I understand angel investing in total is just a little larger than VC investing. Within angel investing, family and friends money outweighs angel group funding by a factor of 13 to 1. What can angel groups do to support the "family/friends" money effort short of having them join the angel group?
I don't know that there is much angels can do to support the friends and family money. I think the best thing to do is to stop thinking in terms of this financing lifecycle model where the entrepreneur puts in money, gets money from F&F and then angels and then VCs. Very few of the businesses that get F&F money are appropriate for angels. So rather than supporting the F&F money effort, I think the issue is to figure out which F&F money is the end of the financing money and which is in companies that seek further rounds. You want to separate out those
for whom the F&F is a stage rather than an end.
You mention that only 5.9% of companies started each reach "gazelle" growth rates of 20% or more per year? Aside from industry is there any data that indicates which companies will grow that fast?
There is. Founder experience, IP protection, business strategy are a few. But none of this is for angels in specific. The study that needs to be done and that I have wanted to do for years because it would be so helpful is to look at all the deals that go into angels. The deals would be tracked and we could see what leads to higher performance. This approach is specific to angel deals and therefore
of great relevance to angels. Moreover, it can tell you if angels are picking winners or losers.
You write about the importance of "staging" funding for angel investments. What more can you tell us about that?
Angels generally think in terms of putting in money in one block and that's it. Staging, putting money in over time with milestones is a better way to monitor companies. So angels should think about how much time it will take to achieve a company's goal - say get the product on the market. Then they should create milestones to get there and give out money on achievement of the milestones. This is essentially the VC way and seems to be done by sophisticated angels,
but not all.
You indicate that angels receive 1.7x on their investment but that the data is hard to judge without time frames. If you separate out the family and friends money which is more a donation than an investment - what multiple would you expect to see?
I don't have the data to look at actual returns by typical angels. The book gives numbers on actual returns for angel group members, expected returns by typical angels, and actual returns by all informal investors. In general, I would say that we can infer that the typical angel neither has the return expectations nor the returns talked about by sophisticated angels in groups.
You indicate that financially successful angels look at the industry of a company to determine its potential value. You show a list of valuations for six-year old companies by industry and they range in valuations. Does this correlate to the maturity cycle of the industry? What other factors drive it?
That's a book in itself. Industry maturity, the nature of production, IP protection, firm size, and a host of other things drive the numbers. The purpose of the chart was to say industry matters and angels need to pay attention to that. They should investigate why industries are attractive or not.
You conclude that state tax policies aren't that helpful and the most practical support the government can provide is to foster the growth in the number of angel groups? Why?
Angel groups allow you to get people involved in investing in start-ups who have lower net worth. That enhances the pool of angel capital and gets the novices working with and learning from the experts. While everyone likes a subsidy, the state tax policies don't seem to actually move many non-investors into the investor categories because state tax rates aren't that high. So taxes aren't as effective. If the federal government created an angel tax credit that might be
different.
How would you encourage the investors to join an angel group?
I would suggest groups go out and look for accredited investors and try to bring them into the group. I would also encourage government programs to get these groups started. There is a bunch of effort that needs to happen in the beginning for which subsidies help and get paid off later.
How do you see the current economic climate impacting angel investing?
It's hurting. Angels invest their own money. They have to limit that to a portion of their net worth. If their net worth drops by one third, the amount of money for angel activity, on average, goes down a third. The only silver lining in this is that people might be allocating a greater portion of their wealth to angel investments. If they are going to lose a lot in relatively low risk low return activities like public equities, they might as well risk losing money for a big winner in a start up.
You list Austin as a good place for angel investing since the number of firms receiving external equity per million population actually puts Austin above San Jose? What should a city like Austin consider doing to improve its position here?
Focus efforts on building and maintaining angel groups. The system is working in Austin. So it is a matter of maintaining the top position. That means keeping the angel groups going. That's the thing under your control. You can't make new entrepreneurs emerge or new technologies be born. But you can make sure that the system stays there for financing them once they are born.
Best regards,
Hall T.
Friday, November 21, 2008
Gail Austin of Summerfield Talks about Her Startup
Gail Austin of Summerfield talks about her startup
How did you get into retail?
I have a degree from the University of North Texas in Interior Design and then I worked at places such as Sanger Harris. It was long ago and now they turned into two or three other entities. Now they are Macy’s.
What’s the idea behind your startup? What’s unique about this one?
So often one goes out to shop and doesn’t find what they’re looking for. I have an idea on how to create a better retail experience at a cost advantage over the competition.
How would you create a better experience?
Summerfield embodies the spirit of luxury, while showing the discriminating consumer an alternative to high costs: special offerings, special services.
Superior customer service: I have JD Powers awards for outstanding customer service.
Also, I am uniquely aware, because of my background, of low and high budgets and particularly good at mixing the two.
What would you focus on first?
Home interiors. I plan to hit the market between the Heather Scotts and the John Williams level. Specifically, I want to hit market trends in home offices and outdoor accessories.
One of the challenges with retail is scalability. How will this scale to be big? How you are going to get to be 5x in 5 year unless you are opening more stores ?
After the initial model takes off, we will open a second location in another Austin top zip code area for high disposable income—not currently served by this type of business. This business will expand with internet sales and marketing, similar to Furniture Land which is based in North Carolina. Their model is a retail outlet and huge internet sales.
How is your business model superior to others?
Same day deliveries, our door to yours.
Interior Design (1 hr.) will be complimentary with delivery of merchandise for add-on sales.
Better displays and suggestions because of my design talent.
Expansion into internet sales and marketing.
Marketing creatively, including realtor emails.
Owner is creative thinker.
How do you plan to expand the operation?
Internet Sales and Marketing, 2nd location, Interior Design Classes, mass emails to select groups.
So have you done a fast pitch competition before?
This is my first try.
Well let’s hear it.
I am Gail Austin. The problem I’m solving is that in the southwest Austin area there is not enough service furnishing homes and gifts locally. People have to drive 30-45 minutes to find what they are looking for. And people in that area have a significant amount of disposable income so as investors we should care that we can meet their needs, give them outstanding customer service and show their profit. So market size down there is wanting to be enhanced and expanded. And I am looking for $125,000 in addition to what I put in the business and we will have a lease, two employees and approximately $50,000 in merchandise on the floor at wholesale prices and the investor can expect a return on his income of about 10%.
The consumers will be amazed at what is at their fingertips: a luxury look at a value price.
Best regards,
Hall T.
How did you get into retail?
I have a degree from the University of North Texas in Interior Design and then I worked at places such as Sanger Harris. It was long ago and now they turned into two or three other entities. Now they are Macy’s.
What’s the idea behind your startup? What’s unique about this one?
So often one goes out to shop and doesn’t find what they’re looking for. I have an idea on how to create a better retail experience at a cost advantage over the competition.
How would you create a better experience?
Summerfield embodies the spirit of luxury, while showing the discriminating consumer an alternative to high costs: special offerings, special services.
Superior customer service: I have JD Powers awards for outstanding customer service.
Also, I am uniquely aware, because of my background, of low and high budgets and particularly good at mixing the two.
What would you focus on first?
Home interiors. I plan to hit the market between the Heather Scotts and the John Williams level. Specifically, I want to hit market trends in home offices and outdoor accessories.
One of the challenges with retail is scalability. How will this scale to be big? How you are going to get to be 5x in 5 year unless you are opening more stores ?
After the initial model takes off, we will open a second location in another Austin top zip code area for high disposable income—not currently served by this type of business. This business will expand with internet sales and marketing, similar to Furniture Land which is based in North Carolina. Their model is a retail outlet and huge internet sales.
How is your business model superior to others?
Same day deliveries, our door to yours.
Interior Design (1 hr.) will be complimentary with delivery of merchandise for add-on sales.
Better displays and suggestions because of my design talent.
Expansion into internet sales and marketing.
Marketing creatively, including realtor emails.
Owner is creative thinker.
How do you plan to expand the operation?
Internet Sales and Marketing, 2nd location, Interior Design Classes, mass emails to select groups.
So have you done a fast pitch competition before?
This is my first try.
Well let’s hear it.
I am Gail Austin. The problem I’m solving is that in the southwest Austin area there is not enough service furnishing homes and gifts locally. People have to drive 30-45 minutes to find what they are looking for. And people in that area have a significant amount of disposable income so as investors we should care that we can meet their needs, give them outstanding customer service and show their profit. So market size down there is wanting to be enhanced and expanded. And I am looking for $125,000 in addition to what I put in the business and we will have a lease, two employees and approximately $50,000 in merchandise on the floor at wholesale prices and the investor can expect a return on his income of about 10%.
The consumers will be amazed at what is at their fingertips: a luxury look at a value price.
Best regards,
Hall T.
Wednesday, November 12, 2008
Travis VanderZanden of QikCom Talks about His Startup Bringing Twitter-like Capability to the Business World
Travis VanderZanden of QikCom Talks about His Startup Bringing Twitter-like Capability to the Business World
So what is your background?
I worked with Qualcomm for five years in San Diego. I decided it was time to start my own company and thought Austin would be a great place to start it.
How did you come up with the idea for QikCom?
I had been following Twitter for a long time. It’s a great way to communicate. I think it makes more sense in the business setting. Right now, consumers use it for things like what they having for lunch. I think it fits better for business. It complements email.
What is your business model?
It’ll be subscription based at the company level. It will be free for employees to sign up to get grassroots adoption. We then plan to charge a subscription for additional Enterprise 2.0 applications in our TabStore. I want to stay away from the advertising model. Twitter is still trying to figure it out. I think they will eventually.
How is your micro-messaging service better than Twitter?
I think that micro-messaging for business needs to be more secure. You have to have a company email address to join. We can lock down the IP address to reside in a certain range. We also have SSL on top of that. It depends on what you’re using it for. We’re hoping they will pay for that.
How many are signed up so far?
We have over 500 companies signed up so far. We’ve identified the early adopters in each of those companies and now we’re trying to spread deeper into the organizations.
How did you find the 500 companies?
All word of mouth. We haven’t started marketing yet.
Where is the development done?
We did everything here in Austin. Nothing was done overseas. We’ll be ramping up quickly to finish our TabStore app platform.
How do you foresee the business user making use of your service?
QikCom is perfect for staying connected with other employees within your company. Micro-messaging is short, quick messages that provide a great alternative to email. We also see the TabStore providing a lot of additional use to organizations moving toward Enterprise 2.0.
Who is your competitor?
Yammer is our largest competitor, they launched a few weeks before us and won the TechCrunch50 award.
How are you better than them?
We’re different from our competition because we’re going far beyond just rebranding Twitter. We’re building a business application marketplace called “TabStore” for on top of our core micro-messaging utility. We currently offer three apps/tabs in the TabStore, ToDo List Management, Frequent Travel Management, and Competition Monitoring.
Travis can be reached at travis@qikcom.com.
Best regards,
Hall T.
So what is your background?
I worked with Qualcomm for five years in San Diego. I decided it was time to start my own company and thought Austin would be a great place to start it.
How did you come up with the idea for QikCom?
I had been following Twitter for a long time. It’s a great way to communicate. I think it makes more sense in the business setting. Right now, consumers use it for things like what they having for lunch. I think it fits better for business. It complements email.
What is your business model?
It’ll be subscription based at the company level. It will be free for employees to sign up to get grassroots adoption. We then plan to charge a subscription for additional Enterprise 2.0 applications in our TabStore. I want to stay away from the advertising model. Twitter is still trying to figure it out. I think they will eventually.
How is your micro-messaging service better than Twitter?
I think that micro-messaging for business needs to be more secure. You have to have a company email address to join. We can lock down the IP address to reside in a certain range. We also have SSL on top of that. It depends on what you’re using it for. We’re hoping they will pay for that.
How many are signed up so far?
We have over 500 companies signed up so far. We’ve identified the early adopters in each of those companies and now we’re trying to spread deeper into the organizations.
How did you find the 500 companies?
All word of mouth. We haven’t started marketing yet.
Where is the development done?
We did everything here in Austin. Nothing was done overseas. We’ll be ramping up quickly to finish our TabStore app platform.
How do you foresee the business user making use of your service?
QikCom is perfect for staying connected with other employees within your company. Micro-messaging is short, quick messages that provide a great alternative to email. We also see the TabStore providing a lot of additional use to organizations moving toward Enterprise 2.0.
Who is your competitor?
Yammer is our largest competitor, they launched a few weeks before us and won the TechCrunch50 award.
How are you better than them?
We’re different from our competition because we’re going far beyond just rebranding Twitter. We’re building a business application marketplace called “TabStore” for on top of our core micro-messaging utility. We currently offer three apps/tabs in the TabStore, ToDo List Management, Frequent Travel Management, and Competition Monitoring.
Travis can be reached at travis@qikcom.com.
Best regards,
Hall T.
Monday, November 10, 2008
Alan Knitowski of Curo Capital Talks about His Startup Experience
Alan Knitowski of Curo Capital Talks about His Startup Experience and the Move to Austin from Southern California
What is your background?
I was a Captain in the US Army Corps of Engineers until August 1996, when I was recruited to Silicon Valley to work at Northern Telecom (now Nortel Networks). I spent 5 great years in the Bay Area from 1996 to 2001, and without a doubt it was an amazing time to be in San Jose to experience both the first big wave of the Internet and the entrepreneurial experiences associated with the VC world on Sand Hill Road. During my time there I not only worked at Nortel, but I also founded, ran and sold my first company, Vovida Networks, to Cisco Systems in November 2000, and also founded my second company, Telverse Communications, which was ultimately bought by Level 3 Communications in July 2003. In 2001, I relocated my family to Newport Coast in Southern California and spent the last 7 years working on several companies there before moving here to Austin in July.
Why did you move to Austin?
I came to Austin for a lot of reasons, some personal and some professional. I have family in Texas and have always had a great time with my friends in Austin, some of which transferred here from the Bay Area. Additionally, I thought that it would be a fantastic environment to raise my four kids, all of which are under 10 and none of which had ever experienced growing up anywhere but coastal Orange County. On the business side, I was thrilled to realize that Texas has no state income taxes and that there would be no state capital gains on any future company sales of start-ups as had been the case back in California. Additionally, I came here to be more centrally located for my business activities on both coasts and to assist some of my current companies with their growth and expansion activities in the Midwest.
What are some of the big differences in the costs of living in California versus Texas?
In California, pretty much everything is more expensive than here in Austin: gas, food, state taxes, labor, office space, etc. And, while Austin may have 2.5% - 3% property tax on your home here versus 1% - 1.2% in Newport Beach there, it’s all relative as 2.5% - 3% of the home values here are still much less expensive that 1% - 1.2% of the home values there. There are certain things such as electricity and water that seem to be more expensive than Newport Beach, but in general things tend to be lower and you seem to get more bang for your proverbial buck.
What kind of work do you do now?
I still work building start-ups and young companies as I did before, but I now also spend more time managing small investment funds and assets both for myself and other accredited investors. Over the past decade I have created, built or advised about 16 companies with my partner Luan Dang, who is still based in Newport Beach. We were blessed to have had four of them sold after the Internet bubble popped, including the two mentioned above, vCIS, which was an anti-virus and security software company purchased by Internet Security Systems and subsequently by IBM, and Bitfone, which was bought by Hewlett-Packard. Two other companies are “Managers” for two additional companies that are “Funds” for accredited investors, including my business partner and I, predominantly focused on private company deals in one and publicly traded securities in the other. We tend to look for deals that we can get involved in managerially and that we can bring some operating leverage and some of our networks across the country to help companies grow quickly and efficiently. For the most part we have only made one passive investment, as we have had our best results where we have been directly involved on a daily basis. One of my current companies is called Caneum, which does business process and information technology outsourcing. Recently it was awarded both the Deloitte & Touche Orange County Fast 50 growth award and the #3 national ranking on the 2008 CRN Fast Growth 100 National List. Outside of Caneum, my partner and I have been extensively involved with Vootage, an online video site anchored with high school athletics and communities, Edgewater Networks, a communications networking equipment company venture backed by Palomar Ventures and El Dorado Ventures and Windspring, focused on data miniaturization technology and software for in-car navigation systems and personal navigation devices. I also have a personal LLC that my wife and I use for other business and investment activities, as is similarly the case with my business partner.
How do you find the funding environment here?
For the most part it is quite a bit different from California on the institutional side, as I sense from talking with many local CEOs that there’s not much VC funding going on locally at the early stages of new ventures. For instance, it appears that Austin Ventures has moved their investment focus a bit further upstream, so many local CEOs still seem to be flying back to California to explore the more traditional venture financing. On the Angel side, however, Austin and Newport Beach aren’t that terribly different as there appear to be quite a few people involved in investing as high net worth individuals or on behalf of family offices or small private equity funds. There are not as many companies in Austin as in the Bay Area in terms of Dell or Google like successes, so there is probably a little bit more investing on the west coast in absolute dollars and a little bit more redeployment of successful liquidity event monies in to new companies and ideas. However, I am hopeful that this will change over time and I am excited to now be here in Austin to be a part of that process. With all of that said, it pretty obvious due to the market and economic conditions that there’s no silver bullet or panacea available for raising funding for just about any young company, whether here locally or out in California. I find the current climate more challenging than at any point since I’ve been doing start-ups because people are confronted with whether to invest in new private companies or simply go out in the open market and buy mature, profitable companies with great dividends for as little as 1 times earnings or less than 1 times cash on hand. Between that, and the lack of meaningful corporate M&A of young companies and a closed IPO window, I think that we’re all looking forward to getting back to somewhere between the irrational exuberance that we had before and the irrational stupidity that we appear to have currently.
What is your advice to other investors?
While I think that it’s important to be cautious, I think that people need to remember that the goal is to invest early in great companies that can develop and mature over the mid and long term to provide for meaningful returns and exits. Some of the greatest companies of the past 10 years came out of the post Internet bubble era and I would expect the same now that the credit and housing bubbles have popped this time around. Additionally, I would suggest that people should try not to be surprised by just about anything that can happen right now for start-ups in this environment. I had one startup not too long ago where the (now former!) CFO was convinced by Wells Fargo to put some of the company’s investment and working capital dollars in to State of Pennsylvania Student Loan Structured Investment Vehicle auction-rate securities via Merrill Lynch so that they could get an extra 70 or 80 basis points in interest on their money. The CFO thought that the suggestion was sound and quite safe because the underlying securities were AAA rated and implicitly backed by both Merrill Lynch and Wells Fargo. Needless to say, the credit markets froze for these securities and suddenly the start-up found itself without access to its capital to run and grow its business. Strange contractual items appear to be coming up all over the place these days, so please be cautious with your management teams and your investors’ investment dollars.
Best regards,
Hall T.
What is your background?
I was a Captain in the US Army Corps of Engineers until August 1996, when I was recruited to Silicon Valley to work at Northern Telecom (now Nortel Networks). I spent 5 great years in the Bay Area from 1996 to 2001, and without a doubt it was an amazing time to be in San Jose to experience both the first big wave of the Internet and the entrepreneurial experiences associated with the VC world on Sand Hill Road. During my time there I not only worked at Nortel, but I also founded, ran and sold my first company, Vovida Networks, to Cisco Systems in November 2000, and also founded my second company, Telverse Communications, which was ultimately bought by Level 3 Communications in July 2003. In 2001, I relocated my family to Newport Coast in Southern California and spent the last 7 years working on several companies there before moving here to Austin in July.
Why did you move to Austin?
I came to Austin for a lot of reasons, some personal and some professional. I have family in Texas and have always had a great time with my friends in Austin, some of which transferred here from the Bay Area. Additionally, I thought that it would be a fantastic environment to raise my four kids, all of which are under 10 and none of which had ever experienced growing up anywhere but coastal Orange County. On the business side, I was thrilled to realize that Texas has no state income taxes and that there would be no state capital gains on any future company sales of start-ups as had been the case back in California. Additionally, I came here to be more centrally located for my business activities on both coasts and to assist some of my current companies with their growth and expansion activities in the Midwest.
What are some of the big differences in the costs of living in California versus Texas?
In California, pretty much everything is more expensive than here in Austin: gas, food, state taxes, labor, office space, etc. And, while Austin may have 2.5% - 3% property tax on your home here versus 1% - 1.2% in Newport Beach there, it’s all relative as 2.5% - 3% of the home values here are still much less expensive that 1% - 1.2% of the home values there. There are certain things such as electricity and water that seem to be more expensive than Newport Beach, but in general things tend to be lower and you seem to get more bang for your proverbial buck.
What kind of work do you do now?
I still work building start-ups and young companies as I did before, but I now also spend more time managing small investment funds and assets both for myself and other accredited investors. Over the past decade I have created, built or advised about 16 companies with my partner Luan Dang, who is still based in Newport Beach. We were blessed to have had four of them sold after the Internet bubble popped, including the two mentioned above, vCIS, which was an anti-virus and security software company purchased by Internet Security Systems and subsequently by IBM, and Bitfone, which was bought by Hewlett-Packard. Two other companies are “Managers” for two additional companies that are “Funds” for accredited investors, including my business partner and I, predominantly focused on private company deals in one and publicly traded securities in the other. We tend to look for deals that we can get involved in managerially and that we can bring some operating leverage and some of our networks across the country to help companies grow quickly and efficiently. For the most part we have only made one passive investment, as we have had our best results where we have been directly involved on a daily basis. One of my current companies is called Caneum, which does business process and information technology outsourcing. Recently it was awarded both the Deloitte & Touche Orange County Fast 50 growth award and the #3 national ranking on the 2008 CRN Fast Growth 100 National List. Outside of Caneum, my partner and I have been extensively involved with Vootage, an online video site anchored with high school athletics and communities, Edgewater Networks, a communications networking equipment company venture backed by Palomar Ventures and El Dorado Ventures and Windspring, focused on data miniaturization technology and software for in-car navigation systems and personal navigation devices. I also have a personal LLC that my wife and I use for other business and investment activities, as is similarly the case with my business partner.
How do you find the funding environment here?
For the most part it is quite a bit different from California on the institutional side, as I sense from talking with many local CEOs that there’s not much VC funding going on locally at the early stages of new ventures. For instance, it appears that Austin Ventures has moved their investment focus a bit further upstream, so many local CEOs still seem to be flying back to California to explore the more traditional venture financing. On the Angel side, however, Austin and Newport Beach aren’t that terribly different as there appear to be quite a few people involved in investing as high net worth individuals or on behalf of family offices or small private equity funds. There are not as many companies in Austin as in the Bay Area in terms of Dell or Google like successes, so there is probably a little bit more investing on the west coast in absolute dollars and a little bit more redeployment of successful liquidity event monies in to new companies and ideas. However, I am hopeful that this will change over time and I am excited to now be here in Austin to be a part of that process. With all of that said, it pretty obvious due to the market and economic conditions that there’s no silver bullet or panacea available for raising funding for just about any young company, whether here locally or out in California. I find the current climate more challenging than at any point since I’ve been doing start-ups because people are confronted with whether to invest in new private companies or simply go out in the open market and buy mature, profitable companies with great dividends for as little as 1 times earnings or less than 1 times cash on hand. Between that, and the lack of meaningful corporate M&A of young companies and a closed IPO window, I think that we’re all looking forward to getting back to somewhere between the irrational exuberance that we had before and the irrational stupidity that we appear to have currently.
What is your advice to other investors?
While I think that it’s important to be cautious, I think that people need to remember that the goal is to invest early in great companies that can develop and mature over the mid and long term to provide for meaningful returns and exits. Some of the greatest companies of the past 10 years came out of the post Internet bubble era and I would expect the same now that the credit and housing bubbles have popped this time around. Additionally, I would suggest that people should try not to be surprised by just about anything that can happen right now for start-ups in this environment. I had one startup not too long ago where the (now former!) CFO was convinced by Wells Fargo to put some of the company’s investment and working capital dollars in to State of Pennsylvania Student Loan Structured Investment Vehicle auction-rate securities via Merrill Lynch so that they could get an extra 70 or 80 basis points in interest on their money. The CFO thought that the suggestion was sound and quite safe because the underlying securities were AAA rated and implicitly backed by both Merrill Lynch and Wells Fargo. Needless to say, the credit markets froze for these securities and suddenly the start-up found itself without access to its capital to run and grow its business. Strange contractual items appear to be coming up all over the place these days, so please be cautious with your management teams and your investors’ investment dollars.
Best regards,
Hall T.
Wednesday, November 5, 2008
Aaron Murray of Tandem Games Talks about His Startup
Aaron Murray of Tandem Games Talks about His Startup and the gaming community in Austin.
Where are you from?
Northern California near Sacramento. I came to Texas because it’s a lot cheaper and my family can enjoy the quality of life.
What is your day job?
I’m a programmer for a leading online hospital staffing company; they call it vendor management. The company has 40 employees and the company successfully competes with some of the bigger players such as McKesson.
How did you get into Tandem Games?
I have a buddy that’s an artist and I’m a programmer so we decided to make a demo for the 2007 Independent Games Conference in Austin. We came in second, but also landed a contract to make a small game. We only made $8K for that game, but the deal was that the company would use it as the focus of their marketing campaign by giving it away on their site and at all of the major conferences on 1GB USB keychains. We did that game in about 6 weeks. The goal with that project was to give us some credibility in a market where many companies never complete their projects. That game went on to win the 2008 Intel Game Demo competition for best graphics.
What’s the next step?
We’re got an entirely new game that we'll be launching soon called Domain of Heroes. It is in public beta right now. The idea is to give people a fun online game to play while at work or school. We've been calling it "Covert Gaming."
How many users do you have?
A few thousand people have signed up to help play that game and give feedback so far.
What is it written in?
The server side is written in C# backed by SQL Server. The client is written in entirely in Javascript so it doesn't require plug-ins and can run on any browser.
How much does it cost?
The game content is completely free. There is a monetization method from Asia that is become increasingly popular in the U.S. called "Free to Play."
What is the “free to play” game market about?
It’s well established in Asia. It basically lowers the barriers to entry by letting players play the game for free, but allows them to make small purchases called micro-transactions as often as they want. We sell "Wishes" for our game. Players can use these wishes to customize everything about the game, as well as acquire many "convenience" features. One nice thing about this model is that it allows us to run ads (which can be removed for a Wish) without bothering players. The great thing is that it enables us to sell to players who don't want to spend more than a couple of dollars on a game, but we can also sell $40+ worth of Wishes to players who want to really have a customized experience. That is hard to do with the traditional fixed-cost single-purchase model. This way we can maximize the monetization of each player at an amount that they all feel comfortable with.
How do users sign up?
If they have an email address, they can register on DomainOfHeroes.com and start playing immediately.
Do you have any help from the community?
There’s several known industry folks who've helped us out in various ways, including: Dr. Cat (Furcadia); Mr. Mike McShaffry (McShaffry.com), George Sanger ("The Fat Man"), Billy Cain (Heatwave Interactive), and Matt Scibilia (Critical Mass Interactive).
Why did you call it Tandem Games?
Originally when we started last fall, I told my buddy I wanted to make a game that I could play with my kids. That concept grew into the idea that most people enjoy playing games of some type (Card, Board, Video, etc.), and that sharing that experience with other people was a happy experience. So the idea of playing games together became the basis for our name, Tandem Games.
How do you find Austin?
Austin has been great to me and my family. The people we've met here have been the most genuine, friendly bunch that I've met in my entire life.
Best regards,
Hall T.
Where are you from?
Northern California near Sacramento. I came to Texas because it’s a lot cheaper and my family can enjoy the quality of life.
What is your day job?
I’m a programmer for a leading online hospital staffing company; they call it vendor management. The company has 40 employees and the company successfully competes with some of the bigger players such as McKesson.
How did you get into Tandem Games?
I have a buddy that’s an artist and I’m a programmer so we decided to make a demo for the 2007 Independent Games Conference in Austin. We came in second, but also landed a contract to make a small game. We only made $8K for that game, but the deal was that the company would use it as the focus of their marketing campaign by giving it away on their site and at all of the major conferences on 1GB USB keychains. We did that game in about 6 weeks. The goal with that project was to give us some credibility in a market where many companies never complete their projects. That game went on to win the 2008 Intel Game Demo competition for best graphics.
What’s the next step?
We’re got an entirely new game that we'll be launching soon called Domain of Heroes. It is in public beta right now. The idea is to give people a fun online game to play while at work or school. We've been calling it "Covert Gaming."
How many users do you have?
A few thousand people have signed up to help play that game and give feedback so far.
What is it written in?
The server side is written in C# backed by SQL Server. The client is written in entirely in Javascript so it doesn't require plug-ins and can run on any browser.
How much does it cost?
The game content is completely free. There is a monetization method from Asia that is become increasingly popular in the U.S. called "Free to Play."
What is the “free to play” game market about?
It’s well established in Asia. It basically lowers the barriers to entry by letting players play the game for free, but allows them to make small purchases called micro-transactions as often as they want. We sell "Wishes" for our game. Players can use these wishes to customize everything about the game, as well as acquire many "convenience" features. One nice thing about this model is that it allows us to run ads (which can be removed for a Wish) without bothering players. The great thing is that it enables us to sell to players who don't want to spend more than a couple of dollars on a game, but we can also sell $40+ worth of Wishes to players who want to really have a customized experience. That is hard to do with the traditional fixed-cost single-purchase model. This way we can maximize the monetization of each player at an amount that they all feel comfortable with.
How do users sign up?
If they have an email address, they can register on DomainOfHeroes.com and start playing immediately.
Do you have any help from the community?
There’s several known industry folks who've helped us out in various ways, including: Dr. Cat (Furcadia); Mr. Mike McShaffry (McShaffry.com), George Sanger ("The Fat Man"), Billy Cain (Heatwave Interactive), and Matt Scibilia (Critical Mass Interactive).
Why did you call it Tandem Games?
Originally when we started last fall, I told my buddy I wanted to make a game that I could play with my kids. That concept grew into the idea that most people enjoy playing games of some type (Card, Board, Video, etc.), and that sharing that experience with other people was a happy experience. So the idea of playing games together became the basis for our name, Tandem Games.
How do you find Austin?
Austin has been great to me and my family. The people we've met here have been the most genuine, friendly bunch that I've met in my entire life.
Best regards,
Hall T.
Sunday, November 2, 2008
Wireless Seedstage Forum 2008—Moximity Wins the Best Pitch
The Wireless Seedstage Forum is hosted each year by the Austin Technology Incubator and the Central Texas Angel Network. The event kicks off the 2008 Texas Wireless Summit.
This year the Forum fielded applications from startups all over the central US and a total of nine companies were selected to pitch their ideas to experienced investors seeking investment opportunities in the space. They ranged from the more traditional enterprise software solutions to gaming to consumer applications. The nine presenting companies were Axelo, Denarii Payments, Gendai Games, MobiTX, Moximity, Ringful, ServiceFirst, SmoothStone, and Unwired Nation.
The audience in attendance at the forum was given the opportunity to select the best pitch of the day, and through that process awarded Moximity the “Best Pitch of the Forum”. Moximity is a free application currently in the iPhone app store which integrates users’ friends from online social networks like Facebook and Twitter with users’ location data. Moximity then overlays information about venues such as restaurants and bars near their location, so users can bring their social life back to the real world.
I’ve downloaded Moximity onto my iPhone and found it significantly improved over the beta version I tried a few months ago.
Bryan Jones was excited about the award. “We are proud to have been selected as the winners, and grateful to the Austin Technology Incubator and the Central Texas Angel Network for providing exposure for companies like Moximity,” said Moximity CEO Bryan Jones.
Best regards,
Hall T.
This year the Forum fielded applications from startups all over the central US and a total of nine companies were selected to pitch their ideas to experienced investors seeking investment opportunities in the space. They ranged from the more traditional enterprise software solutions to gaming to consumer applications. The nine presenting companies were Axelo, Denarii Payments, Gendai Games, MobiTX, Moximity, Ringful, ServiceFirst, SmoothStone, and Unwired Nation.
The audience in attendance at the forum was given the opportunity to select the best pitch of the day, and through that process awarded Moximity the “Best Pitch of the Forum”. Moximity is a free application currently in the iPhone app store which integrates users’ friends from online social networks like Facebook and Twitter with users’ location data. Moximity then overlays information about venues such as restaurants and bars near their location, so users can bring their social life back to the real world.
I’ve downloaded Moximity onto my iPhone and found it significantly improved over the beta version I tried a few months ago.
Bryan Jones was excited about the award. “We are proud to have been selected as the winners, and grateful to the Austin Technology Incubator and the Central Texas Angel Network for providing exposure for companies like Moximity,” said Moximity CEO Bryan Jones.
Best regards,
Hall T.
Monday, October 27, 2008
Richard Tieken of Prelude Dynamics Talk about the Clinical Trials Market
What is your background and what do you do?
I come from Aerospace. I was at Lockheed for a number of years. I started out at NASA and worked on demand and control problems with military applications.
How did you get to Austin?
I was raised in Shiner, Texas. It has a beer that is an amazing story. My grandfather would take us to the local beer-hall and would buy his one Shiner beer in the afternoon. For a lone time it was only available there. Now they include it on airplanes.
But how did you get into Prelude Dynamics?
Well, it's kind of interesting. There is a command and control software which is about building things that commanders make use of to understand their situation and so, there was guy that I knew at Lockheed who left the aerospace industry and went into a company that was trying to manage healthcare integration for competing surgeons. So basically the analogy is to trade-out the guy in a military uniform for a guy that wears a white lab coat. It's still the same problem. They have all this information, and after weeks, months and years what do you really know?
How did you get started?
We had a number of Lockheed employees who are high quality software engineers. We wanted to expand in Austin around 1996 after Lockheed closed down.
We decided to pursue the clinical trial industry.
Sounds interesting? What's the challenge?
Each trail is individual and you have to tailor the system to support a study. The companies that do this need a large amount of money to build these studies. And because the trials cost so much software doesn't impact their budget. So in the human world you have to deal with different privacy issues but in clinical trials there's no issue of people's identify - only data to deal with.
How do you accomplish that?
You are not allowed to know who the patient that the doctor is seeing. He knows but that's being kept deliberately blinded to me.
How is the data processing different in this area?
It's a small amount of data, so we can be really fast. We don't use the relational database systems but use an XML system instead. It's very flexible. Part of what Alicia Browner who works with me brought is the epiphany that a lot of our competitors are going down big Oracle or relational database systems as if they were a bank doing 10,000 transactions an hour. And we talked about most of the trials being much smaller than that. Why not just move the data into XML classes? XML has a lot of advantages too. We can add information while the trial is going on and adding a field to a form is trivial. With just five minutes of work I can add a field in XM and it automatically adjusts next time you go to that page.
What about Prelude Dynamics as a company?
We have run a good business niche it works quite well. But we want to scale up the business. We need more sales. We need money to bolster sales and marketing. We need somebody that we can add to our company that gets excited about making the sales.
So who is the target customer for your product?
Our niche is small to medium pharmaceutical companies, the biopharmas, and device companies that end up going to the FDA. Also, the CROs called
Contact Research Organizations. When a pharma has a new compound they need to go out and hire a Contract Research Organization to help run the clinical trials.
How long does the study usually go?
They can go anywhere from 6 months to 5 years.
What's the average length?
They are always at least 6 months. I mean, there are studies that go for a few weeks but most of them with any consequence go for at least 6 months and some of them like a cancer study might go for 10 years.
Best regards,
Hall T.
I come from Aerospace. I was at Lockheed for a number of years. I started out at NASA and worked on demand and control problems with military applications.
How did you get to Austin?
I was raised in Shiner, Texas. It has a beer that is an amazing story. My grandfather would take us to the local beer-hall and would buy his one Shiner beer in the afternoon. For a lone time it was only available there. Now they include it on airplanes.
But how did you get into Prelude Dynamics?
Well, it's kind of interesting. There is a command and control software which is about building things that commanders make use of to understand their situation and so, there was guy that I knew at Lockheed who left the aerospace industry and went into a company that was trying to manage healthcare integration for competing surgeons. So basically the analogy is to trade-out the guy in a military uniform for a guy that wears a white lab coat. It's still the same problem. They have all this information, and after weeks, months and years what do you really know?
How did you get started?
We had a number of Lockheed employees who are high quality software engineers. We wanted to expand in Austin around 1996 after Lockheed closed down.
We decided to pursue the clinical trial industry.
Sounds interesting? What's the challenge?
Each trail is individual and you have to tailor the system to support a study. The companies that do this need a large amount of money to build these studies. And because the trials cost so much software doesn't impact their budget. So in the human world you have to deal with different privacy issues but in clinical trials there's no issue of people's identify - only data to deal with.
How do you accomplish that?
You are not allowed to know who the patient that the doctor is seeing. He knows but that's being kept deliberately blinded to me.
How is the data processing different in this area?
It's a small amount of data, so we can be really fast. We don't use the relational database systems but use an XML system instead. It's very flexible. Part of what Alicia Browner who works with me brought is the epiphany that a lot of our competitors are going down big Oracle or relational database systems as if they were a bank doing 10,000 transactions an hour. And we talked about most of the trials being much smaller than that. Why not just move the data into XML classes? XML has a lot of advantages too. We can add information while the trial is going on and adding a field to a form is trivial. With just five minutes of work I can add a field in XM and it automatically adjusts next time you go to that page.
What about Prelude Dynamics as a company?
We have run a good business niche it works quite well. But we want to scale up the business. We need more sales. We need money to bolster sales and marketing. We need somebody that we can add to our company that gets excited about making the sales.
So who is the target customer for your product?
Our niche is small to medium pharmaceutical companies, the biopharmas, and device companies that end up going to the FDA. Also, the CROs called
Contact Research Organizations. When a pharma has a new compound they need to go out and hire a Contract Research Organization to help run the clinical trials.
How long does the study usually go?
They can go anywhere from 6 months to 5 years.
What's the average length?
They are always at least 6 months. I mean, there are studies that go for a few weeks but most of them with any consequence go for at least 6 months and some of them like a cancer study might go for 10 years.
Best regards,
Hall T.
Wednesday, October 22, 2008
Christian Reed of EastWest Alternative Assets Talks about his view of Austin Alternative Energy Policy and His Investing Interests
Are you a native of Austin?
I am from San Diego. In December I will be here three years.
What brought you here?
Austin was voted a top “Green” city and the overall thinking is very progressive. When we decided to establish a US presence for our carbon trading and alternative energy companies we settled on Austin for this reason and the fact that it is the capital of a state that is leading the way in alternative energies, is progressive in the adoption of alternative energy and provides a great investment climate.
So you are interested in Angel investing?
We have done some start up investing. Right now we’re interested in alternative energy such as next generation batteries, solar start-ups, bio-fuel plays and any other progressive technologies that will help reduce our dependence of foreign sources for energy. While Austin offers rebates for solar panels I think the city is missing an opportunity for real financial benefit within the current rebate program. While aggressive compared to many other cities, it could be more progressive. Currently the city pays the rebate amount in cash, up-front, calculated from the “plate rating” of the system that is being installed. Many factors cause this to be inaccurate and not fair for the city of Austin, conversion inefficiency, shading, orientation to the sun to name a few, all these will impact the actual production of electricity from a solar array. Right now because The city should be paying for electricity generated and placed back on the grid, not just equipment installed.
I have proposed that a ‘FIT’ or Feed-In-Tariff program be explored as an option to more accurately track and fund solar installations, not only would the cash up-front be significantly reduced but the amount payable would be accurate and calculated off of actual energy produced by a system.
I’m working on building my case for this. Whatever the plates on your solar system say, then that’s what you are going to get back as a rebate. Well, if your panels are shaded then you are not going to generate anywhere near that amount of energy. In some brief discussions with Austin Energy we have a few things to tackle before we could move forward, first to satisfy the “de-regulation question” and there are also some system ownership issues. As a financier of Solar Installations for large commercial projects East West Alternative Assets has an interest in owning the system and selling the power. If we become the seller of power within Austin Energy’s area the argument is that by default they are “deregulated.”
What else do you invest in?
I believe water conservation is also important. When you see that some of our major rivers are not reaching the ocean I think one must realize the machine is broken. If the rivers and oceans are not able to do the job then the earth is not going to operate how it is supposed to, water is the vital part of all life and it should be an issue that everyone takes seriously. Not long ago, the Colorado River failed to reach the ocean. That means the cycle of water returning to the ocean is broken. The system cannot cleanse itself.
Perhaps angel investment can help with that.
I think there will be great opportunity for good companies with ideas on how to conserve water and we would welcome the opportunity to help them along.
What other areas do you invest in?
We are involved in oil & gas exploration, carbon reduction/green house gas reduction projects, carbon credit trading, real estate, technology, and various other areas including solar finance and project management.
What are your investment requirements?
What we look for mainly is the ability to add value to our investments personally. We don’t take a shot-gun approach and hope one in ten investments work out. We take a personal role in nurturing investments along with our input and contacts and other investments all working synergistically to help one another.
Best regards,
Hall T.
I am from San Diego. In December I will be here three years.
What brought you here?
Austin was voted a top “Green” city and the overall thinking is very progressive. When we decided to establish a US presence for our carbon trading and alternative energy companies we settled on Austin for this reason and the fact that it is the capital of a state that is leading the way in alternative energies, is progressive in the adoption of alternative energy and provides a great investment climate.
So you are interested in Angel investing?
We have done some start up investing. Right now we’re interested in alternative energy such as next generation batteries, solar start-ups, bio-fuel plays and any other progressive technologies that will help reduce our dependence of foreign sources for energy. While Austin offers rebates for solar panels I think the city is missing an opportunity for real financial benefit within the current rebate program. While aggressive compared to many other cities, it could be more progressive. Currently the city pays the rebate amount in cash, up-front, calculated from the “plate rating” of the system that is being installed. Many factors cause this to be inaccurate and not fair for the city of Austin, conversion inefficiency, shading, orientation to the sun to name a few, all these will impact the actual production of electricity from a solar array. Right now because The city should be paying for electricity generated and placed back on the grid, not just equipment installed.
I have proposed that a ‘FIT’ or Feed-In-Tariff program be explored as an option to more accurately track and fund solar installations, not only would the cash up-front be significantly reduced but the amount payable would be accurate and calculated off of actual energy produced by a system.
I’m working on building my case for this. Whatever the plates on your solar system say, then that’s what you are going to get back as a rebate. Well, if your panels are shaded then you are not going to generate anywhere near that amount of energy. In some brief discussions with Austin Energy we have a few things to tackle before we could move forward, first to satisfy the “de-regulation question” and there are also some system ownership issues. As a financier of Solar Installations for large commercial projects East West Alternative Assets has an interest in owning the system and selling the power. If we become the seller of power within Austin Energy’s area the argument is that by default they are “deregulated.”
What else do you invest in?
I believe water conservation is also important. When you see that some of our major rivers are not reaching the ocean I think one must realize the machine is broken. If the rivers and oceans are not able to do the job then the earth is not going to operate how it is supposed to, water is the vital part of all life and it should be an issue that everyone takes seriously. Not long ago, the Colorado River failed to reach the ocean. That means the cycle of water returning to the ocean is broken. The system cannot cleanse itself.
Perhaps angel investment can help with that.
I think there will be great opportunity for good companies with ideas on how to conserve water and we would welcome the opportunity to help them along.
What other areas do you invest in?
We are involved in oil & gas exploration, carbon reduction/green house gas reduction projects, carbon credit trading, real estate, technology, and various other areas including solar finance and project management.
What are your investment requirements?
What we look for mainly is the ability to add value to our investments personally. We don’t take a shot-gun approach and hope one in ten investments work out. We take a personal role in nurturing investments along with our input and contacts and other investments all working synergistically to help one another.
Best regards,
Hall T.
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