In January, entrepreneurs from all over the country arrived in San Antonio for the first ever TechStars Cloud.
Nicole Glaros, one of the program’s directors, moved to San Antonio with her family for the three month program.
Jason Seats, the other director, says the program is coming to a conclusion with TechStars Cloud Demo Day on April 11th at the Charline McCombs Empire Theater at 226 N. St. Mary’s Street.
At the event, 11 TechStars Cloud teams will give eight minute company pitches to the audience which will include investors, TechStar mentors, family and friends as well as community members.
To reserve a seat, you’ve got to RSVP on Eventbrite because the event is expected to be at capacity.
Angel and other investors can also contact Jason Seats directly about reserving a seat at the event.
TechStars Cloud Demo Day runs from 9:30 a.m. to 2:30 p.m. with an after party at the Weston Center Terrace starting at 7 p.m.
Tag: cloud computing (Page 2 of 2)
Jason Seats, managing director of the TechStars Cloud, says hundreds of companies applied to the program. In the end, TechStars choose 11 companies. All of them are from outside of San Antonio. Seats is not revealing the company names until April 6th at TechStars Cloud Demo Day.
Nicole Glaros, one of the founders of TechStars in Boulder, will also move to San Antonio for the 13-week program with her family. Seats says the program will serve as the catalyst San Antonio needs to ignite its high-tech startup community. All of the companies will be located at Geekdom, a collaborative workspace at the Weston Centre in downtown San Antonio.
The TechStars Cloud could serve as a catalyst to ignite 
San Antonio’s startup technology community.
That’s because ten new startups will locate here for the 12-week program, which kicks off in January. Also, Nicole Glaros, TechStar managing director, will move here with her family. She will run the TechStars Cloud along with Jason Seats.
On Saturday, about 120 applicants, mentors, funders and others gathered at Rackspace’s new collaborative workspace downtown, called Geekdom. The 15,000 square foot offices on the 11th floor of the Weston Centre will host the TechStar Cloud companies.
At TechStars for a Day, applicants listened to speakers and panel discussions about what it’s like to be a TechStars entrepreneur. They also networked. The program ended at 4 p.m. but many stayed until past 6 p.m. to drink Dos Equis and Shiner beer and chat.
Seats ran the TechStars for a Day program. People sat in bright red, black and white stools and chairs or on large red bean bags in front of a giant screen on which Seats projected the images of Glaros and TechStars Founder David Cohen, both located in Denver, via Skype. Glaros is in the last trimester of her pregnancy and can’t travel right now. But she gave sage advice and insight into the program.
“TechStars’ secret sauce is its mentors,” Glaros said, which include some of the best and brightest minds nationwide, she said. “These mentors are giving freely of their time to make sure these companies get to the next level.”
Glaros told the room to “put down your smart phones and start talking” and to “participate actively” to get the most out of the day. She also told them to “nail your elevator pitch. It should be two sentences and less than 30 seconds.”
“Don’t hog too much of anyone’s time,” Glaros said. “Keep conversations to five minutes.”
And on that note, Glaros’ broadcast froze. Seats tried to fix the connection, which prompted Rackspace Chairman Graham Weston to say “This is the only production in town where the guy running the show is also the audio and visual guy.”
The lean production speaks to the culture of the TechStars startups to do as much as they can on strict budgets. But all of the TechStar Cloud winners get money. They receive $18,000 and access to a $100,000 loan. They must relocate to San Antonio for the duration of the program, which culminates in April with a TechStars Cloud Demo Day, in which they pitch their companies to investors. Weston, Rackspace Founders Pat Condon and Dirk Elmendorf have provided the funding for TechStars Cloud for the next four years.
Cohen, also spoke to the group via Skype because his mother was visiting him. TechStars has already funded 100 companies of which nine have been acquired by larger companies and 14 have failed. Collectively, the startups have raised $100 million. Anyone can apply for the program, including foreign companies, as long as they obtain Visas. The program is about “a community” of expertise around funding technology startups, Cohen said. Successful entrepreneurs serving as mentors, combined with alumni and TechStar’s network of 75 venture funds and angels nationwide help to make the program a success, Cohen said.
“A large focus is on quality,” Cohen said. TechStars provides 10 mentors to one company, he said.
“Our goal is to make every single company we fund successful,” Cohen said.
The two biggest startup killers are lack of a market for a product and issues with the team, Cohen said. TechStars mentors can help with those issues because they have faced them before in their own startups. To succeed, the companies need to “be the best in the world at what you do,” Cohen said.
Trying new things, failing and learning from the mistakes are some of the biggest advantages startups have over large and well funded companies, Cohen said.
In response to a question from the audience, Cohen said the biggest misconception about TechStars is it’s “only for very young companies or 21 year old white dudes.” The average age of a applicant is 31 and the age range of TechStar entrepreneurs is generally between 22 and 42 years old, although they’ve had older entrepreneurs, he said. Lots of companies are already established in a market but need help getting to the next level, Cohen said.
“Many companies come into TechStars with $1 million in revenue or $1 million in funding,” he said.
The inaugural TechStars Cloud program focuses on “companies that are building the cloud and not building on the cloud,” Cohen said. The cloud provides companies the ability to deliver computer services online.
After the overview of the program and advice from Cohen and Glaros, Seats introduced Weston to the crowd.
“The legacy of this man is going to be all about this town,” Seats said. “Graham Weston has done more for this town than any single man since Davy Crockett.”
Rackspace knows how to help startups because it was one not too long ago.
At a San Antonio hamburger joint in 1998, Weston and his partner Morris Miller met with three Trinity University students, Elmendorf, Condon and Richard Yoo, the founders of Rackspace, a startup hosting company. Rackspace has since evolved into a publicly traded hosting giant with $1 billion in revenue and nearly 4,000 employees. It is San Antonio’s largest technology company and Weston, Elmendorf and Condon want to create more like it.
Weston, referencing the book “The Coming Job’s War,” said most of this country’s net new jobs are produced by companies less than five years. Startups are fueling the country’s economic growth now and into the future, he said.
Then Weston gave a pitch on the city’s shining attributes that would have made the Greater San Antonio Chamber of Commerce proud. He mentioned the city’s low unemployment rate and huge medical and biotechnology industry, which is larger than the tourism industry. He touted the city’s rapidly developing urban life with thousands of apartments and condos being built in the downtown area and the city’s 68 miles of bike trails and 11,000 acres of urban parks. San Antonio has affordable housing, Weston said.
“You can buy a great house for less than $200,000,” he said.
San Antonio has the benefits of a large city, but the feel of a small town, Weston said. It’s kid friendly and a great place for families, he said. He also mentioned the city’s 31 higher education institutions and 100,000 students and its thriving arts community.
The city also has five Fortune 500 companies and a few large private companies like USAA and HEB. The startup community in San Antonio is poised to take off, Weston said.
“The founders and I are determined to create the next Rackspace over the next 20 years,” Weston said.
Weston then introduced Seats, who founded Slicehost, which Rackspace acquired in 2008. Rackspace’s cloud revenue has grown from zero to $200 million since that acquisition, Weston said. One of the requirements of the acquisition was that Seats move to San Antonio, Weston said.
“He’s the sort of entrepreneur San Antonio needs more of,” he said.
Seats has an office in Rackspace’s Geekdom and is looking forward to helping other entrepreneurs succeed with their ventures.
In addition to the entrepreneurs, Ned Hill, a venture capitalist with DFJ Mercury in Houston, gave the audience advice on how to seek funding. DFJ Mercury provides investments ranging from $50,000 to $1 million and has $110 million under management. One of DFJ Mercury’s hot portfolio companies is Austin-based Game Salad, which allows anyone to create a game for a variety of devices without knowing any coding.
Hill often gets asked “How do I choose the right VC?” He says “The right VCs are easy to spot. They are the ones writing the checks.”
He told the entrepreneurs to be flexible and persistent.
“You’ve got to be really good at telling your story,” he said. VCs invest in ideas that make sense and have value and in people who are passionate and know their market better than anyone, he said. “Vision, passion and drive,” Hill said. “Let it shine though. Don’t give up, make it happen.”
Deals can take only a few days or up to a year to get funded, he said. DFJ Mercury likes to own at least 20 percent of the company upon exiting the investment. VCs like to see the opportunity to earn ten times their investment when they give a company money, but most deals don’t earn anywhere near that, he said.
He advised the entrepreneurs to always be thinking about their exit strategy, especially if they receive funding.
“You can’t be in it for the lifestyle,” he said. “If you’re not able to sell a company in five to seven years then you’ve got a problem. Try to exit your business within five years.”
Elmendorf told the group that one of their greatest strengths was not knowing a lot.
“You literally have no idea how hard it is what you’re trying to do,” he said.
But that’s ok, and failing is also Ok, he said.
“As long as you keep doing this, it’s a learning process,” he said. “Failing is totally awesome as long as you don’t stop. If you stop and go get a real job, then you’re a failure.”
Starting a company is a “messy, hard endeavor,” Elmendorf said.
Startup companies need to know what problem they are trying to solve. It’s easy to get sidetracked, so entrepreneurs must constantly focus and ask themselves what they’re trying to work out, he said.
Entrepreneurs often play multiple roles in the organization early on, but they’ve got to spin those off and hire more people as the organization grows.
“I was HR because I had the most jobs,” Elmendorf said. “I slowly carved off the other things that weren’t related.”
Other panel discussions and talks featured former Techstars entrepreneurs, some who succeeded and others who did not.
Don’t be afraid to try something that doesn’t work out, said Josh Fraser, founder of EventVu and Torbit. He shut down EventVue after three years in February of 2010. EventVue created an app that allowed people to network at conferences. After closing up shop, he started getting calls from Facebook and other large companies that wanted to hire him. He also got calls from former investors who wanted to know what he was working on next. He’s now founder of Torbit.
Donning a brown stetson and cowboy boots, Lance Walley founder of Chargify and a TechStars Cloud mentor, talked about customer acquisition and pricing.
“Pick a niche and charge enough for your products,” he said. “If you know who your customer is, you can acquire them.”
In a later panel featuring other TechStar mentors, Rackspace Founder Condon said that narrowing the market and focusing the product on a specific customer is the best way to succeed.
“You have to say no to a lot of folks,” he said.
The application deadline for the Rackspace TechStars Cloud program is Monday, Nov. 7.
The deadline to apply for the TechStars Cloud program is Monday.
But already the program has received several hundred applications for the inaugural TechStars program in San Antonio, said Jason Seats, managing director for TechStars Cloud and cofounder of Slicehost, which San Antonio-based Rackspace acquired.
On Friday night, several of those entrepreneurs met with Rackspace employees and tech company mentors at the Esquire Tavern on the Riverwalk downtown. Some of them travelled from Nashville, Portland, San Francisco, Madison, Wisc. and the United Kingdom.
On Saturday, they will gather on the 11th floor of the Weston Centre downtown from noon until five to hear speakers from Rackspace including one of the founders, Dirk Elmendorf and Rackspace Chairman Graham Weston along with speakers from TechStars.
Seats calls it “TechStars for a day.”
Elmendorf says Rackspace has remade the 11th floor of the Weston Centre into “Geekdom” with plenty of space for start up companies to work and mingle.
The 13-week TechStars Cloud program will start in January and culminate with the TechStars Demo Day in April in which the selected companies will pitch to potential investors. San Antonio is the fifth site for a TechStars program with other locations in Boston, Seattle, New York and Boulder, Colo.
“This location is all about cloud,” Seats said.
The cloud is like “the plumbing of the Internet,” Seats said. It’s the “heavy-lifting technology stuff that takes place behind the scene.”
Seats says the applicants for the TechStars Cloud program, so far, have more of a business to business focus, rather than a business to consumer focus. The applicants span a wide range of industries including music, hosting, infrastructure, video and gaming.
The interest in the program is high because not only do the 10 TechStars Cloud companies receive $18,000 in initial investment but they receive mentoring and access to a network of accomplished entrepreneurs and potential funders.
“It’s a fantastic time to start a new company,” Seats said. “If you’re a developer with a great startup idea, the economy is not hurting for you.”
Most of the TechStar cloud companies will come from outside of San Antonio, Seats said. He expects just one to two to be from this area. And he hopes that the injection of new talent into the San Antonio startup community will serve as a catalyst to spur further companies here. And he hopes some of the companies may decide to stay in San Antonio permanently upon completion of the program.
Seats has met with several of San Antonio’s angel investors and he says the community is starting to invest in technology and biotechnology companies locally.
“There is no scarcity of money in San Antonio,” Seats said. “There’s always money for good ideas and good people.”
Seats just returned from TechStars Demo Day in Seattle. He was especially impressed with Romotive, which creates a kit to turn an iPhone into a robot, Everymove, which works with companies to provide healthy incentives to their employees, Vizify, a social network data analysis site and GoChime, connecting brands with people on social media.
The PC market is alive and well.
“We don’t see PCs going away at all,” Michael Dell said Wednesday afternoon, during a question and answer session at a Dell World press and analysts event in Austin.
“There are a billion and a half PCs in the world and that seems to me like a pretty big number,” Dell said. “Estimates are that there will be 2 billion PCs in a few years so it’s a growth market.”
While the industry shifts to more mobile devices like smart phones and tablets, Dell sees those devices as augmenting the PC and not replacing it. He will talk more about Dell’s plans for innovation during an 8 a.m. keynote address to the inaugural Dell World Thursday at the Austin Convention Center. About 2,000 people are expected to attend the sold-out event, which runs through Friday.
Dell is also focused on capturing Hewlett Packard’s customers during this turbulent time as HP goes through leadership changes and company realignment.
“I also believe that there is certainly a benefit to us, an opportunity that is created by the turmoil and uncertainty at one of our major competitors,” Dell said.
Dell released a survey this week by Technology Business Research, that showed most of the 130 HP U.S. customers with at least 500 customers, surveyed reported concern with the direction HP has taken.
HP announced plans to jettison its $40 billion PC business and become a software and services company like IBM. But those plans are in limbo since the departure of its old CEO Leo Apotheker. Now under the leadership of its new CEO, Meg Whitman, HP may keep its PC business after all, according to a story in the Wall Street Journal Tuesday.
To further diversify its business, Dell has also shifted into the data center, solutions and services business over the past several years. It’s not the same PC maker that Dell founded 27 years ago.
Steve Schuckenbrock, president of Dell Services, reported that Dell is number one in services in the healthcare industry and number two in the education space around the world.
“We started out as a product company,” Dell said. In the last decade, Dell has evolved into a solutions company, but one that still cares about PCs, he said.
During the last 18 months, Dell has been one of the most active acquirers of businesses in the information technology industry, Dell said. It has added companies like Compellant, Kace Networks, Force 10 Networks and SecureWorks. Dell looks at more than 250 companies a year to decide which 8 or so it wants to acquire, Dell said.
“In last 12 months, earnings per share grew by 83 percent,” Dell said. The growth is coming from acquisitions and organic growth, he said.
Dell has also made a big push into the data center business and cloud computing. It has made $1 billion worth of investments in data centers this year. Dell just announced the opening of new data centers in the United Kingdom and in Quincy, Washington. This year, Dell has also opened nine Solutions Centers and plans to open three more by the end of this year.
A reporter asked Dell his thoughts on China-based Lenovo, which bought out IBM’s PC business, becoming the number two PC maker worldwide. Dell said that his company focused on profits and revenue and not necessarily number of PC units sold. He called Lenovo a great competitor, but said he didn’t worry about rankings. Research firm IDC reported on Wednesday that Lenovo overtook Dell for the first time to become the number two PC maker. HP ranked first with an 18 percent market share, followed by Lenovo with nearly 14 percent and then Dell with 12 percent.
The total information technology industry is worth $3 trillion and only 10 companies have 1 percent of that market and Dell is one of the companies that has more than 1 percent of that market. But it’s a highly fragmented market and not a single company dominates the industry, he said.
Dell also shared his thoughts on the fast growing tablet marketplace, which he says “is basically an iPad market.” He sees the challengers to the iPad are Microsoft’s Windows 8 and Google’s Android operating system for mobile devices.
“Those are the two primary alternatives to iPad,” Dell said. Dell appears to be backing the Windows 8 system for the tablet market. It will announce a wide variety of products around Windows 8 when it is released, Dell said.
TechCrunch reports that San Antonio-based Rackspace has teamed up with Boulder-based TechStars to bring its innovative startup program to San Antonio.
The program is called the TechStars Cloud. It’s a “themetically focused accelerator that will fund companies working exclusively on cloud computing, cloud infrastructure, and Openstack.”
The program’s mentors include Pat Condon, one of Rackspace’s founders, Jeff Lawson, founder and CEO of Twilio, Brad Feld of Foundry Group, George Karidis of SoftLayer, Rajat Bhargava, founder and CEO of StillSecure and others.
The program runs from January to April next year at Rackspace Hosting’s offices at the Weston Centre on the Riverwalk.
TechStars plans to select 10 companies which will receive seed funding, mentors and other perks. Jason Seats, the founder of Slicehost, which Rackspace acquired in 2008, and Nicole Glaros, managing director of TechStars, will head up the program.
Startups focused on building cloud-based infrastructure must apply to program by Oct. 21st.
A reality show based on TechStars debuts tonight on Bloomberg TV. Here’s a clip of the show, which provides an inside look at the TechStars startup process and some of its high-profile mentors.
TechStars Trailer from Vortex Media on Vimeo.
