Texas reported 150 venture capital backed deals worth $1.3 billion in 2013, according to a report by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters.
The number of deals in Texas fell nearly 9 percent from 163 but increased 37 percent in the dollars invested from $948.8 million in 2013.
The report found venture capitalists in the U.S. did 3,995 deals worth $29.4 billion, up four percent in number of deals and seven percent in dollar volume from a year earlier.
In the fourth quarter, Texas had 47 deals worth $315.9 million; up nearly 24 percent in number of deals and a 54 percent increase in dollar volume. Overall, $8.4 billion went to 1,077 deals nationwide in the fourth quarter.
The bulk of the money went to software and Internet companies.
The money invested in software companies reached the highest level since 2000 with $11 billion invested in 1,523 deals last year.
“Dollars going into software companies accounted for 37 percent of total venture capital invested in 2013, the highest percentage since the inception of the MoneyTree Report in 1995.”
Tag: venture capital (Page 2 of 4)
Main Street Hub announced today that it has closed on $14 million in venture capital led by Bessemer Venture Partners.
The Austin-based company manages social media communications for small to medium-sized businesses in the U.S., Canada, U.K., Ireland and Hong Kong.
Main Street Hub plans to use the funding to further develop its products and to hire sales staff in Austin, San Francisco, New York and Los Angeles.
Existing investors also participated in the round. The company previously raised $6 million.
“Keeping up with shifts in social media and other ways to connect with customers online is a full time job, but it’s not something most local businesses are staffed to manage. Main Street Hub makes the process painless and rewarding with a full service ‘do-it-for-you’ SaaS marketing platform that helps local businesses through the entire marketing funnel with a combination of people, data and innovative technology,” Co-founder and Co-CEO Andrew Allison said in a news release.
Silicon Hills News did this profile on the company last summer.
Main Street Hub charges businesses a fee to manage their social media presence online including postings on Facebook, Twitter, Yelp, Google+, Foursquare and TripAdvisor. The company designs a customer relations management platform that allows businesses to easily communicate with customers and to market to them.
The company, founded in 2010, has close to 3,000 customers and 175 employees in four offices.
“At BVP, we’re sensing a shift in power as technology levels the playing field for smaller companies and gives them access to solutions and platforms that were previously only afforded by large box stores and behemoths. Main Street Hub will be a key player in this: They make it possible for local businesses to leverage every channel and engage directly with their customers with a tailored approach that doesn’t require any change of behavior for the merchant or their customers,” Rob Stavis, partner at BVP said in a news release. “In backing Main Street Hub we are not only investing in this growing trend, but also investing in a great company and team that can execute.”
Josh Baer, Bob Metcalfe, instructors with Longhorn Startup and Mark Cuban
By LAURA LOREK
Founder of Silicon Hills News
Since selling Broadcast.com to Yahoo for $5.7 billion in 1999, Billionaire Mark Cuban has invested in 80 startups.
But his entrepreneurial ventures began as a kid growing up in Pittsburgh.
“As long as I can remember I was an entrepreneur,” Cuban said.
At the age of nine and ten, Cuban packaged baseball cards and sold them to his friends.
At 12, he wanted new basketball shoes. His dad told him that his tennis shoes were just fine and when he had a job he could buy any kind of shoes he wanted. A family friend had some garbage bags he wanted to get rid of and offered them to Cuban. So Cuban sold them door-to-door to earn enough money to buy the basketball shoes.
Cuban recounted the story Thursday night before a packed audience of more than 800 people at the University of Texas Longhorn Startup’s Demo Day. The semester-long course for undergraduates at UT aims to teach them entrepreneurial skills and how to found a startup. One of its instructors, Bob Metcalfe, professor of innovation at UT, Ethernet inventor and co-founder of 3Com, interviewed Cuban at the Lady Bird Johnson Auditorium following pitches by 14 student-run startups.
During the hour-long talk, Cuban provided insights into his entrepreneurial journey and lessons learned along the way.
Early on, if it wasn’t garbage bags, it would have been something else, Cuban said.
At 16, Cuban’s mom introduced him to stamp collecting. He consumed information about stamps. At stamp shows, Cuban would buy a stamp from one dealer for 50 cents and walk down to the other side of the show and sell it for $50. Selling stamps helped him pay for school.
Cuban’s College Years
He left Mt. Lebanon High School early because he couldn’t take business classes. He went to the University of Pittsburgh and took classes. He earned enough credits to finish high school. He ended up transferring to the Kelley School of Business. He researched and discovered it was one of the top ten business schools in the country and it had the lowest tuition. At Indiana University in Bloomington, Cuban earned his undergraduate degree in business. He also did a year and a half of his MBA.
“I wanted to take all the hardest classes that I could my freshman and sophomore years and I promised myself I wouldn’t drink and then my junior and senior years when I was 21 I would take all the easy classes and party like a maniac,” Cuban said. “And that’s what I did.”
He also ran a bar in college, which went out of business.
After he left college, Cuban worked for nine months for Mellon Bank in Pittsburgh. He learned how to program there in Fortran. But he didn’t like banking much so he moved to Dallas.
Moving to Dallas
When Metcalfe asked him why, Cuban said “For fun, sun, money and women.”
He had friends who moved to Dallas. He liked the tropical climate. He lived in the village with six guys in a three-bedroom apartment and he slept on the floor.
“I loved every minute of it,” Cuban said.
He worked as a bartender at night. He bought a Texas Instruments 99/4A computer and taught himself to program. He really liked it. Then he got a job at Your Business Software, a retail store, selling Peachtree software and different applications. He did that for nine months and then he got fired. That’s when he started his own PC and software consulting business called MicroSolutions. They set up PCs and software for businesses and set up local area networks.
The crowd clamoring to get a picture with Mark Cuban and Bob Metcalfe at the end of Longhorn Startup Demo Day
That prompted Cuban to talk about the importance of history in understanding the world today.
“One of the things kids are missing today is a sense of history,” Cuban said. They Google something and if it doesn’t come up in Google, it didn’t happen. But there’s a ton of stuff that isn’t in Google, Cuban said. What kids don’t know is if the companies went out of business, their servers aren’t online anymore and they can’t find out about them. Entrepreneurs need to dig deeper to find information on people who have tried an idea and failed at it so they don’t repeat those same mistakes, he said.
Yet one of the most brilliant things Cuban learned from was this kid in Austin who would post the price of generic computer parts in PC Week Magazine. Cuban drove down to Austin and bought a bunch of computer parts directly from him. When he got back to Dallas, Cuban wrote him a letter.
“Michael, if you keep this up, things will go really well for you,” Cuban said. That kid, of course, was Billionaire Michael Dell. Today, they still crack up about it, Cuban said.
“How did you decide to sell your company to CompuServe?” Metcalfe asked.
“They offered, and I said yes,” Cuban said.
He wanted to retire by the time he was 35. MicroSolutions had $30 million a year in revenue and was very profitable, Cuban said. He sold the company to CompuServe for $6 million. After that he worked for them for a little bit. But then he got a lifetime pass on American Airlines, he retired and “partied like a rock star.”
The founding of AudioNet, later to be renamed Broadcast.com
Cuban and his friend Todd Wagner started AudioNet so they could listen to Indiana basketball games on the Internet. They started the company in the second bedroom of Cuban’s house.
Cuban had a $39 Video Cassette Recorder that recorded for eight hours. He would record radio stations and then import that programming into his computer and eventually post it to the Internet. They had 600 to 700 radio stations that they would post online. The company had tens of thousands of hours of audio content online and more than one million visitors daily coming to the site to listen to it.
Cuban and Wagner started AudioNet in 1995, the same year that Netscape went public. They sold it four years later to Yahoo for $5.7 billion in stock.
In 2000, Cuban spent $285 million of his fortune to buy the Dallas Mavericks National Basketball Association team from Ross Perot Jr.
Cuban always loved basketball. He didn’t play in high school though. He said he was five foot eight and weighed 240 pounds in high school. Today, he’s six foot three and weighs 205 pounds.
The Mavs are a different type of entity, Cuban said. The team is unlike any business he has ever run. Even though he writes the checks, the team belongs to the community, he said. In 2011, the Dallas Mavericks became NBA champions. To turn the team around, Cuban focused on putting players in a position to succeed.
In addition to owning the Dallas Mavericks, Cuban also stars on the popular television show Shark Tank on ABC which features entrepreneurs pitching venture capitalists with the hopes of landing an investment.
“It’s a lot of work,” Cuban said.
The so-called “Sharks,” successful businessmen and women who invest their own money, don’t know anything about the people who pitch to them, Cuban said. What takes just 10 minutes of TV time, though, can take two and half-hours of interrogation off camera, Cuban said.
The investors, or Sharks, are allowed to do due-diligence after they invest in the companies. In fact, one time Cuban made an investment in a woman’s company but her husband didn’t believe in paying taxes and hadn’t ever paid them, Cuban said. So he was able to get out of that deal.
Out of the 80 startups Cuban has invested in, 28 came from Shark Tank pitches.
Mark Cuban and the rest of the cast of Shark Tank, photo courtesy of Shark Tank
Out of his 28 investments, Cuban has had one company fail and another that should shut down, he said. But the others are either dragging along or doing very well, he said.
“Shark Tank is the most successful one hour selling platform in the world,” Cuban said. Lani Lazzari, owner of Simple Sugars, sold nearly $1 million worth of her body scrub products after being featured on the show for 10 minutes, Cuban said. He invested $100,000 for a 33 percent stake in her company. She recently turned down a buyout offer. She wants to get to $30 million in annual revenue, he said.
Now is an amazing time to start a business, Cuban said. With a laptop, phone, Internet connection and Amazon account, people can create any kind of business, Cuban said.
Entrepreneurs only fail because of lack of effort and brains
“The one thing in our lives every entrepreneur can control is effort,” Cuban said. Companies don’t fail for lack of anything but lack of effort and brains, he said.
The biggest error companies pitching to Cuban make is that they don’t have any sense of history, he said. Some entrepreneurs also underestimate the amount of effort it takes to turn their ideas into reality.
“It takes time, it’s a grind,” Cuban said. “There are no shortcuts. You’ve got to grind and grind.”
Mark Cuban meets the team behind The Zebra, an Austin startup he invested in but has never met in person until Longhorn Startup Demo Day.
The luckiest guy in the world
An audience member asked Cuban what he regrets not doing.
“It’s turned out pretty well – nothing,” Cuban said. “Someone’s got to be the luckiest guy in the world and luck has played a big part in the level of my success. And I’m just glad it’s me.”
To pitch Cuban, send him an email to MCuban@gmail.com. He reads the first paragraph and if he’s interested, he’ll read more and send the entrepreneur some follow up questions. If he likes the answers, then he might invest. He has invested $10 million in startups he discovered through email pitches and with $6 million worth of those investments he has never even met the entrepreneur, Cuban said.
Gravitant, which makes software for companies to manage their cloud services, announced Wednesday that it has received $10 million in Series B funding.
Corsa Ventures led the round and was joined by existing investor S3 Ventures.
The Austin-based company plans to use the money to expand its sales and marketing, to fulfill customer orders and to add more features to its cloud management platform.
In addition, Alex Gruzen with Corsa Ventures will join Gravitant’s board of directors.
“Gravitant has the potential to change the way Enterprise IT is done,” Gruzen said in a news statement. “While cloud computing shows much promise in transforming IT, CIOs are struggling with cloud adoption and simply not getting the ROI they expect from their private and public cloud investments. Gravitant’s cloudMatrix brokerage and management platform optimizes agility and cost while maintaining control. The result is a vastly improved cloud ROI.”
“Customer interest in cloud brokerage and management platforms is accelerating, and this funding will help us take advantage of this rapidly growing market space,” Mohammed Farooq, co-founder and CEO of Gravitant said in a news statement. “We believe Gravitant will be the next major software company in Austin, and we are very pleased to see the support from Austin-based venture capitalists to help us realize this goal.”
By LAURA LOREK
Founder of Silicon Hills News
Funded companies, which are performing well, get nice offices and free lunches for their employees, said Mike Dodd, partner with Austin Ventures.
Mass Relevance is one of its portfolio companies performing quite well. And on Wednesday, the company hosted a panel discussion about successfully raising capital for a startup company as part of Austin Startup Week.
The two-year-old company has grown from four employees to more than 120 employees and raised $5.5 million in a Series A round of funding and it already has millions in revenue from customers like NBC, MTV Networks and CNN. Its partners include Facebook and Twitter. Mass Relevance, formerly known as TweetRiver, aggregates social media content for its customers.
Claire England, executive director of RISE Austin, moderated the discussion, which paired two successful startup Co-founders with their lead investors. Eric Falcao, founder and Chief Technology Officer of Mass Relevance joined Dodd of Austin Ventures and Josh Kerr, Co-founder and CEO of Written teamed with Krishna Srinivasan, general partner at Live Oak Venture Partners.
Mass Relevance got early traction by landing a six-figure deal with MTV, said Falcao. And then the Co-founders brought on Sam Decker, formerly of BazaarVoice, as its CEO. He had connections with Austin Ventures. Mass Relevance got seed funding easily and raised its first round without a lot of trouble, Falcao said. Mass Relevance also went to California and received funding from Mike Maples Jr.’s Floodgate Partners, an early investor in Twitter.
Kerr bootstrapped his first two companies, but he wanted to build a really big company with Written, which markets bloggers’ content to brands, so he saw the need to get funding from the start. He was able to get a seed round from Live Oak Venture Partners.
“I wanted the structure that comes from raising money and the acceleration that comes with it,” Kerr said.
Signs of a successful startup
Next, England asked the venture capital investors to talk about the signs they look for when evaluating a startup investment, the warning signs of bad investments and top signs of good investments.
“This is such a people business,” said Srinivasan with Live Oak Partners. “I think that is the most important factor. We’re looking for people who have an insight from what they have done before.”
Live Oak Partners also looks for people they can work with and collaborate, Srinivasan said. The ones that don’t work out are entrepreneurs who are not collaborative and those that don’t want to be great partners, he said.
“It’s obviously team, team, team,” Dodd said.
But Mass Relevance had a really great product and they were solving a problem of aggregating real-time Tweets for companies early on, Dodd said.
“What we try to do is look around the corner at the early markets,” Dodd said.
Austin Ventures saw Mass Relevance as being one of the big players in social media for television, Dodd said.
The importance of relationships
Next, England asked how often the companies and funders met and interacted with each other.
Falcao said he sees Dodd once every quarter, but that Dodd met with other executives, like Decker, on a more regular basis.
Dodd said he talked to Decker about once or twice a week. He joked he visited the Mass Relevance office often because they have free lunch for employees. His firm also helped in hiring some of the senior executives and helped to recruit people.
“We can get six head of sales literally almost over night,” he said.
Kerr said Srinivasan gives his seed stage company sage advice.
A good investor helps in team building and scaling the company much more aggressively, Srinivasan said.
England also asked if there was a downside in partnering with investors. The question was met with laughter and then a bit of awkward silence before Falcao answered.
“When things are going well, things are going well,” said Falcao. “VCs are good. They come with checks and advice and more checks. When things work, they work. So far, we haven’t gone through hardship. So it’s tough to point to anything.”
The downside is companies start to rely on them, Kerr said.
“They are bringing this really great value to the business. It’s not just money,” Kerr said. “It’s your buddy. It’s much, much more than that. But you’re not the only company they are invested in and you’re not getting 100 percent of their time. So the only downside is you might want more and not get it.”
What happens when things are not going well? England asked.
“I have plenty that are not doing well,” Dodd said. “They don’t have offices like this. They don’t have free lunches. We focus on burn.”
Austin Ventures works to make sure they are focused on maximizing profit and minimizing losses and working to get market share in their industries, Dodd said. The relationship between the investor and the entrepreneur doesn’t change, he said. In a few cases, though, it has, he said.
“I still believe in what they are doing, it’s just taking longer than expected,” Dodd said.
Venture capitalists like to chase trends but it’s good to keep focused on the main business and not get distracted by whacky ideas and the latest trends, Falcao said.
“You need to ask yourself are we just chasing something new?” Falcao said. “You shouldn’t always do exactly what your customers want you to do. There’s something about staying on a mission and staying focused rather than chasing X.”
When a firm makes an investment and things don’t go as planned, the investors work to salvage the value and help hold the ship together to find an acquirer or to get some modest outcome, Srinivasan said.
“Those things take a lot of hard work,” he said.
Making the pitch to investors
England then asked the entrepreneurs how they marketed themselves to potential investors.
Kerr said when he pitched his company to Live Oak, Srinivasan sent him three really challenging questions in an e-mail message. He had time to think about the answers, but he couldn’t come up with the answers.
“Ultimately I ended up going back to him and saying these questions are too hard,” Kerr said.
At an early stage, the investment in the company is more about the people than the idea, and it’s better to be honest and admit when you don’t know something, Kerr said.
“If you don’t know the answer, you don’t know the answer,” he said.
Srinivasan said that he liked the honesty that Kerr displayed. He was able to evaluate the risk of investing in them and to gauge how much it would take to get the company to the next level, he said.
Startups should know how to answer basic questions from investors about customer acquisition costs and know how to scale, Falcao said.
“If you haven’t thought about that, you’re not thinking about how hard it is to scale a SMB (Small to Medium-Sized Business) company,” Falcao said.
How much money should startups ask for and how much time should they spend doing it?
The size of a check should be reflective of the stage of the company and issues it is facing, Srinivasan said.
“Just getting out of the gate, you’re going to raise a little bit of money,” Dodd said.
Typically, seed stage companies raise money from angel investors ranging from $350,000 to $1.2 million, Dodd said. A Series A round receives between $2.5 million and $7 million and a Series B round can get up to $20 million, he said.
Kerr said he spends 90 percent of his time raising money. His other partners focus on running the business.
The startup ecosystem in Austin
England asked if Austin had a strong enough funding ecosystem to support startups.
Both Kerr and Falcao raised money from California from Floodgate Investments.
“More firms. We need more firms here,” Dodd said.
The ecosystem needs more sophisticated seed stage investors, he said. He said he wished there were three or four more firms like Live Oak to increase competition for funding, he said.
Raising second and third round funding is easy if a company is doing well, he said. But it’s harder to get people in the valley to invest in early stage companies, he said.
Austin needs more firms focused on early stage, Dodd said. More investment firms are good for Austin, he said.
“A rising tide floats all boats,” he said. “The more money that is in town, the better everyone will do.”
In the 30 years he has been in the market, this is the most vibrant and most exciting time, Srinivasan said. The quality of the ideas is really good, he said.
“Clearly this place can have more early stage companies,” he said.
The overall maturing of Austin’s startup ecosystem has contributed to Austin’s vibrant startup community, Srinivasan said. People who have been through the process a few times and transplants from California now populate it, he said.
“It’s a genealogy effect,” Dodd said. Successful companies spin out successful startups, he said.
Austin Ventures has funded three or four startups by people who left BazaarVoice, a company Austin Ventures backed that went public, Dodd said.
Veros Systems announced Monday that it has received $8 million in Series A venture financing.
Chevron Technology Ventures led the deal with additional investment from Austin Ventures and LiveOak Venture Partners.
Veros, which makes control center software called Veros ForeSight that monitors industrial operations, has been testing its software system for several years at multiple Chevron sites.
The company is also presenting at the Chevron-Oiltech Investment Network today in Houston.
Veros, based in Austin, received $1.5 million last year from the Texas Emerging Technology Fund.
Tommy Knight and Alex Parlos founded Veros System in College States and licensed the rights to commercial the technology from Texas A&M University.
Bigcommerce, a site that lets anyone create an online store, raised $40 million from Revolution Growth.
Steve Case, co-founder of the Revolution Growth fund and founder of America Online, will also join Bigcommerce’s board.
The Austin-based company, founded by Eddie Machaalani and Mitchell Harper in 2009, has raised $75 million to date.
Bigcommerce’s software has already helped more than 35,000 companies launch online stores, market their businesses and build brands for just $25 a month. Its customers include Gibson Guitar, Zaggora.com, YETI Coolers and many more.
“Bigcommerce is a big idea that aligns perfectly with Revolution Growth’s philosophy: that technology can enable any entrepreneur, in any industry, located anywhere, to build a successful, high-growth business,” Case said in a news release.
Bigcommerce plans to use the funds to further develop its product and for marketing. The company is also hiring new employees.
“At our core, we are simply entrepreneurs helping other entrepreneurs build the business of their dreams,” Bigcommerce co-founder and co-CEO Mitchell Harper said in a news release.
Laura Kilcrease, Brett Hurt, Michele Skelding and Rick Timmins Photo by ©2013, Scott Van Osdol, www.vanosdol.com
By LAURA LOREK
Founder of Silicon Hills News
Austin has one of the nation’s most active angel networks through the Central Texas Angel Network, known as CTAN.
Last year, CTAN, with 100 members, invested about $8 million in 28 companies, including 13 new companies and 15 portfolio companies.
Every angel investor is doing it because they are passionate, said Michele Skelding, a CTAN member and angel investor.
She spoke at the RISE Lunch & Learn panel Tuesday on Angel & VC Funding at the AT&T Executive Education and Conference Center in Austin.
Michele Skelding photo by ©2013, Scott Van Osdol, www.vanosdol.com
Throughout an hour long discussion, the panelists talked about a wide range of topics including what they look for when deciding to make an investment to tips on how to talk to a potential investor.
A startup must have five critical ingredients to build a successful company, said Hurt. He details them on his blog Lucky7.io. They are a solid business plan, a good team, the proper mindset, funding and culture.
While Hurt, 41, spent the first half of his life building companies, he plans to spend the second half helping entrepreneurs make an impact on Austin. His focus is on ideas that can become big businesses. Hurt co-founded Bazaarvoice which is now a $540 million company.
Laura Kilcrease and Brett Hurt photo by ©2013, Scott Van Osdol, www.vanosdol.com
“There are some people who are thinking too big,” he said.
He’s only interested in working with companies that have products like Bazaarvoice and HomeAway. The one difference is if he has his Angel hat on he will make an investment in something different like Deep Eddy Vodka. He actually met Clayton Christopher, the founder of Deep Eddy Vodka, through RISE.
“I’m a huge, huge fan of RISE,” Hurt said. “This is one of the best things the city has going.”
If he makes an investment in a company like Deep Eddy and he gets back three times his investment then that’s just fine, he said.
But normally, he wants to see companies that have a clear path to get to $100 million in revenue or $1 billion in revenue.
“Most of the things I see are not close to that,” he said. “Lifestyle businesses are just fine. I’m a think big guy.”
When it comes to writing a check, Timmins looks at four things. The most important thing is the entrepreneur, he said. He looks for leadership qualities, managing skills, the ability to take advice and listening skills.
“It’s about the person or the people running the company,” he said. “Fifty percent of what I look at when I decide to invest is about the entrepreneur…If there are any doubts in my mind, I don’t do it.”
His second criterion for investment is the company’s technology and whether it’s disruptive enough. He’ll often consult experts to help him assess that.
The third thing he looks at is a customer.
“All you need for me to believe this is one paying customer who believes in what you’re doing and what you’re trying to establish,” he said. “The last thing I look at is the business plan.”
The business plan makes up just 10 percent of his decision making process.
“I don’t believe business plans anymore,” he said. “But I want you to go through the exercise…I want you to go through the process of thinking through it.”
As a venture capitalist, Kilcrease looks at two key aspects: the jockey and the team, she said.
“We know the business plan is wrong but it’s giving us an idea of what you’re thinking,” she said. “The next thing I look at is the market.”
The average angel investment is around $275,000 and the average venture capital round is $2 million to $3 million.
“I think the jockey and the market is key,” Kilcrease said. “The very last thing I look at is the technology. An “A team” will be able to rework the technology to the market or pivot as they go along.”
In addition to VCs and Angels, now investors are starting to see a third category called the Super Angel who is funding the gap between seed stage and Series A funding for startups, Kilcrease said. And another funding source is syndication between angel networks across the country, which can provide funding in the $1 million to $3 million range, she said.
“Don’t just think about angels as a $50,000 check,” she said.
Mentorship that a company gets is more important than the amount of money they receive, Hurt said.
“A business needs capital and mentorship,” he said. “It’s like a marriage. You can take money from angels and it can be your worst nightmare. It’s got to be the right fit.”
CTAN has five funding cycles through the year, said Skelding. And CTAN added office hours as a more informal way to get to know the angel investors and for entrepreneurs to discuss their ideas, she said. One big mistake entrepreneurs make is that they are just not prepared to pitch to investors.
“You’ve got to learn how to speak to an investor,” Skelding said. “They’ve seen thousands of deals.”
Entrepreneurs need to serve up their ideas in a way that is quick and interesting, she said.
Angels will invest in any type of businesses, Kilcrease said.
“If you get the right angel there’s almost no area they won’t consider,” she said. Whereas, VCs have specialized areas they invest in, she said.
Since 2009, Timmins has invested in 24 companies and only one has a chance to be public, he said.
In response to a question about the single biggest mistake people make in their pitch, Hurt said that entrepreneurs go into the VC or Angel pitch and they show a hockey stick growth slide that they don’t believe in.
“Set expectations you think you can meet,” he said.
Rick Timmins photo by ©2013, Scott Van Osdol, www.vanosdol.com
“If you don’t want the pressure of being accountable then be like my parents and don’t ever raise money,” Hurt said. His dad created a halogen fishing light but turned down an offer from Wal-Mart because he wanted to keep his business simple.
Another audience member asked about when to take additional funding for her business.
“Only take the amount of money that will add value to get you to the next level,” Kilcrease said.
In the first TechStars class held at the Geekdom earlier this year, Cloudability already had a head start on some of the other companies.
The Portland-based startup had already participated in the Portland Incubator Experiment. When the team landed in San Antonio, they had already raised $1.1 million, according to VentureBeat.
Now Mat Ellis, Cloudability’s CEO, has announced the company has raised an $8.7 million first round of venture capital led by Foundry. In addition, Jason Mendelson and Jason Seats, managing director of the TechStars Cloud, will join its board of directors.
“Just over a year ago we were on stage at Structure with some screen shots and just a few users, so this is a really big deal for us,” Ellis wrote in a company blog post on the deal.
“Today over 3,000 people in 100 countries are using Cloudability. Collectively they have spent over $100 million on cloud services, and added over 10,000 cloud accounts,” according to Ellis. “If ever there was an advert for the power of the cloud, this is it. Three guys have an idea, and one year later that idea is being used across the planet.”
Cloudability helps companies manage how much they spend on Cloud services. Rackspace Hostings offers the service to all of its cloud customers. The company plans to use the money it has raised to hire more people and build out its product offering by adding more features. Cloudability has 15 employees, up from four in December.
The only downside to the funding? Ellis can’t get this tune out of his head:
By SUSAN LAHEY
Reporter with Silicon Hills News
Richard Garriott de Cayeux is passionate about many things. Space, exploration, the environment, the moral imperative of games, building cool houses and collecting things. So how did he choose to make his first game to launch from Portalarium, the most recent incarnation of his gaming company, Ultimate Collector?
“There are all kinds of ideas we kicked around; potential threads to latch onto …to create as our first original title,” Garriott de Cayeux said. “We wanted to create a game that demonstrates very well that we understand the game mechanics and ease of play of this new third wave of gamers.”
Garriott de Cayeux, known just as Richard Garriott until his marriage in 2011 to equity fund manager Laetitia Pichot de Cayeux, was one of the original game creators. His games, inspired by stories like The Lord of The Rings Trilogy, have been rich in stories, levels, multiple players and layers of meaning, he wanted to show that Portalarium could build games for people who weren’t planning to invest a lot of money and time. He needed a game that could show its value fast.
“We wanted an aesthetically familiar enriching experience that would start with an avatar and a world map and let you explore: go to retail outlets and pawnshops, go around collecting in a wide variety of categories. I can tell you that just through collecting I’ve become sort of an expert on fossils, weapons and armor, automatons…just through exposure a little at a time. I’m a big believer in collecting. You can become very knowledgeable and it’s still as simple and light as any other game.”
Portalarium just raised $7 million in Series A funding from M8 Capital, FF Angel, BHV Venture Capital, and Garriott himself. The company plans to release Ultimate Collector beginning with a PC and Facebook game and follow it 30-60 days later as a mobile game among other platforms.The funds will also help launch Garriott de Cayeux’s next RPG, Ultimate RPG/New Britannia, for mobile platforms.
His new company, started in 2009, began with $3.5 million in seed capital. It aims to be “platform agnostic” to adapt to constantly changing technology and gamer preference.