- What It Was Like To Launch At Disrupt NYC
- DryerBro iPhone App Notifies You When Your Laundry’s Done
- Facebook Still Has No iPad App But They’re Building A Desktop Software Team?!
- Disrupt Hack Baitr Skewers Viral Launch Pages
- LinkedIn Halo Effect? Facebook Shares Surge To New High In SharesPost
- The Ultimate Guide To Disrupt NYC 2011
- After Surging Past Angry Birds, The Heist Now Selling An App A Second
- Munch On Me Is A Groupon For Food, Done Right
- Accoya Uses Chemistry Trick To Detoxify Exterior Wood Treatment Process
- Welcome To The Future: Polymer Vision Demos SVGA Rollable Screen
- Data Tracking Startup Mixpanel Raises $1.25 Million From Sequoia, Rabois, Levchin, And Birch
- Charlie Cheever Explains The Difference Between Quora And Wikipedia
- A Bit More On WWDC, The Mythical iPhone “4S”, and iOS 5
- In Front Of Its IPO, Kayak Reports Growth In Revenue But Income Down
- Google Responds To PayPal Lawsuit: People Have The Right To Seek Better Jobs
Posted: 28 May 2011 06:37 AM PDT
Editor’s note: The following guest post is by David Chase (@chasedave), the CEO of Avado, a healthcare startup that was one of the 30 Battlefield Finalists at Disrupt NYC last week. Chase was going to publish this on his blog, but we asked him if we could post it here instead to share with everyone. We didn’t attempt to correct any misconceptions in the post to keep it true to how Chase experienced the event. You can watch his presentation in the video at the bottom of this post
There are many local, regional and global startup competitions that startups can compete in. I'm a big believer in the value of these startup competitions for two big reasons—they are a great forcing function to ship your product and refine your ability to pitch your business. Even if you have no plans to raise money, you will have to pitch your business to achieve your goals.
My startup (Avado) is a Patient Relationship Management platform for health and wellness providers such as doctors, physical therapists, nurse practitioners, health coaches, physician assistants and personal trainers. We decided to pursue the opportunity to compete in the TechCrunch Disrupt startup competition. To my knowledge, it is the most competitive and well-attended startup competition even though I perceived it to be more oriented towards "fun" technology. Though there's a consumer aspect to Avado, the primary initial focus is on the B2B aspect (the consumer side has a Connected Health Record that is akin to a Mint/Quicken for healthcare) whereas a large percentage of the Disrupt competitors are only consumer-focused.
Each startup competition has its own selection process. In the case of TechCrunch Disrupt, a triumvirate of Erick Schonfeld (Co-editor of TechCrunch), Heather Harde (CEO) and Michael Arrington (Founder) evaluates the companies after they have winnowed down the first list of companies. My understanding is that two out of the three of them need to greenlight a company to be a finalist. During the course of the TechCrunch Disrupt event, Michael referred a couple times to Erick Schonfeld veto'ing a company. It wasn't clear whether that was a joke or not, but he appeared to be serious.
We were fortunate to be one of the startups that made the first cuts. The next step was to schedule a demo with Erick. We scrambled to pull together what we thought was a coherent flow. Following the demo, Erick asked some questions regarding our business model and the product. At the end, I asked him for his frank feedback as this was one of our first demos so I knew it was pretty rough. He gave me some very useful feedback. At the end of the call, he said we would hear from someone to schedule a demo with Mike or Heather.
With the benefit of hindsight, my hunch is that the fact that we were very coachable and significantly improved our demo and story-telling was a factor in making us a finalist. The next demo was with Heather (also via the phone/screenshare). I took her through the updated demo and it followed a similar process as my call with Erick. At that point, we were told that we'd hear in a couple days if we'd made it to the finals. As it turned out, it took almost a week.
We received the news we'd been selected via email which, of course, we were elated to receive. The next step was to schedule a visit where we'd receive more formal, face-to-face coaching on our presentation and we'd also incorporate more about our business model and go-to-market plans. My impression is the focus that Erick, Heather and Mike have at this point shifts from a weed-out mentality to a coaching mentality as they want to have as high quality an event as possible. When I took Heather through our presentation/demo, it went ten and a half minutes (vs. the 6 minute target). Since we had a relatively complex product and a dual customer (healthcare provider and consumer), she actually suggested we flip the order around in our scenario to lead with the doctor and then review the patient side of the equation. Her feedback was invaluable to tightening up our presentation. We subsequently took her through a revised presentation/demo that fit well within the 6-minute limit.
From there, it was time for the final preparations and travel to New York. They suggest that one person "drive" the demo while the other person speaks. At that point, I needed to coordinate with my co-founder, Bassam Saliba, so that we were in sync for the demo. We did several practices before we felt satisfied with our synchronization. We also took the precautionary measure of doing screen captures of all of our demo in the event of connectivity issues.
Once we arrived in New York, we went through the scheduled technical run-through on stage. We also found out we were in the second day of "Battlefield" presentations. They grouped the startups into groups of similar companies (e.g., search, location, etc.). We were in the "Disrupting the Real World" group. From reading the program, I was able to review who our judges would be but it turned out two of the four couldn't make it—I think it had something to do with the Icelandic volcano. One who didn't make it was Beth Comstock who is GE's CMO which was unfortunate since GE has a big medical division. I was hoping for someone with domain knowledge since it's challenging for judges without any domain knowledge to judge whether a B2B startup in an unfamiliar vertical market is taking a sound approach or not.
Finally our time to present came. As fate would have it, our DNS provider decided to play mind games with us. Literally while the company before us was presenting, our site became unavailable which we learned when one of the guys back at the office texted us that there were issues. I had mentally prepared for something like that to happen so I wasn't too worried. Bassam's PC was already on stage so he couldn't test it. Fortunately, I had mine and quickly fired it up. To our pleasant surprise, I was able to get to the site so we rushed from backstage with a minute or two to spare.
You can be the judge of how well we did (see Avado is the Mint for your Personal Health Records. or the video below) but we were generally pleased with how things went. After our presentation, the judges had 6 minutes to ask me questions. I thought all of the questions were reasonable. The main thread of questions were around the dual customer (i.e., patients and providers) approach since that adds complexity and generally startups should focus as much as possible.
The final comment and question came from Bijan Sabet of Spark Capital. He made the point that he didn't understand why a problem as big as the issue in healthcare we were addressing hadn't been resolved yet. Bijan followed that with a suggestion/critique that he thought we should just start with the consumer and that would drive the change. While I thought I had a decent response (we are focusing on partnerships with health-related non-profits that span both patient and provider), I kicked myself later for not having the better response. That is, the response to his comment that he was surprised it hasn't been solved is the very fact that parties have tried to solve either the doctor side or the patient/consumer side but no one had tackled the bridge between the two. The takeaway for other startups is that you can't anticipate every question so the sooner you start putting yourself out for critique and feedback, the better. Thanks to Bijan's comment, I believe we can turn what may have been viewed as a weakness into one of our key points of differentiation and strength.
As it turned out, we were part of the group that had the eventual winner (Getaround). They generally picked one company from each of the groups to present on the final day of the event. I predicted from the moment I saw Getaround that they'd be the winner. They had the perfect mix of a tight presentation/demo, they were very well resourced (they'd already received significant funding—enough to ship a Tesla from San Francisco to New York!) and were very similar to a deal that got away from some of the judges (AirBnB). It was fun to see their excitement winning. We felt like we won the minute we found out we were a finalist. While hardly a guarantee of success, winning or being a finalist in any startup competition is a nice seal of approval that can help the business. The coverage we got from the tech and venture capital publications such as TechCrunch, VentureBeat and GeekWire were terrific, since we'll be fundraising in the future. The VentureBeat coverage was a total surprise.
Would I do it again? No question.
Posted: 27 May 2011 10:59 PM PDT
With DryerBro you put your iPhone or iTouch on your laundry machine and it texts you and the remaining members of your laundry party when your laundry’s done. I’m thinking this is going to be HUGE. I mean Facebook took off at colleges right?
Once set up, DryerBro uses an accelerometer and Twilio to send a SMS, email or call to multiple phones when your unmentionables are ready to be picked up.
Says creator Eric Kerr, “We live in a house with 11 dudes, and we’re seriously unorganized about laundry. We all want to use the machine on the weekends, but no one ever knows when the last load was done. It bothered me as hackers that we had the tools (accelerometer, Twilio) to solve the problem, but didn’t do anything about it.”
So they built DryerBro. “We originally looked to see if an app already used the accelerometer to detect when your laundry is done but we couldn’t find anything – it’s a blue ocean strategy,” he says.
Kerr and company are completely ridiculous, but their thing apparently works. When asked about future plans for DryerBro he told TechCrunch:
“Ultimately we want to build out a hyper-local group buying ad platform for laundry detergents. Rough back of the napkin calculations indicate that we’d need roughly $41 million in financing, so we’re asking friends and family to help pony up the dough. We also want to build out the map of every active dryer in the world to hang on the wall of our office.”
Posted: 27 May 2011 10:25 PM PDT
Facebook has no iPad app. It’s ridiculous. Their iPhone app is the most downloaded app in the history of apps. And third-party iPad apps (many of which aim to trick users) constantly dominate the top 10 lists for both free and paid apps. And yet, Facebook doesn’t seem to care at all about the device. Because they’re all about HTML5, right?
Well, someone might want to tell the Seattle office that.
On the jobs page for the relatively new Seattle Facebook office, one of the openings is for “Software Engineer, Desktop Software”. Desktop software. Desktop. Before the damn iPad. Hey Facebook, 1986 called, they want their strategic vision back.
Seriously though, this isn’t just one engineer they’re looking for to work on fun products (like the nifty, but experimental Mac Desktop Notifications app), this is an entire team they’re building. Again, to work on desktop apps. The job description:
The job asks for expertise in creating desktop applications for Mac and/or Windows (Linux fans can now revolt as well).
Other responsibilities include:
Is Facebook actually building a full-fledged desktop app? If so, that’s awesome. But again, it doesn’t seem to make a lot of sense given their stated (over and over again) commitment to HTML5 and that being the key driver for why they don’t have an iPad app.
Of course, I also don’t believe that they’re not actually building an iPad app. I think they just thought they could get away with not building one (remember “the iPad isn’t mobile” — but the desktop is?) and only more recently realized they should probably be on the fastest growing new computing platform in history.
Or might this be about the Facebook Browser that I’ve been thinking about for a while? That might actually make a lot of sense.
Interesting times for the social network. I just better see that damn iPad app before I see a desktop client.
Posted: 27 May 2011 08:48 PM PDT
While Baitr didn’t win the TC Disrupt Hackathon, it did win the minds and hearts of those in attendance who have a tendency towards black humor. Baitr, a Launchrock-type viral launch page that does nothing but visualize your email falling into the abyss, isn’t at all useful. But it is funny.
Says creator Peter Watts, “Launchrock is good for entrepreneurialism but it’s also bad [for users] because you sign up for these services, and then you never hear back from them.” Watts hopes that his hack will encourage startups to do something more productive with their beta sign up page.
“All these people are driving to a page, willing to give their email,” says Watts. “Once you have their email, maybe ask them some questions or engage with them? There’s so much more you can do.”
Ironically enough, Watts said that he too would use a Launchrock page if he were launching a startup. I guess parody, not imitation, is the sincerest form of flattery.
Watch the interview with Peter Watts below and read more about TechCrunch Disrupt NYC here.
Posted: 27 May 2011 07:54 PM PDT
Facebook shares on private secondary markets like SecondMarket and SharesPost spiked briefly in March to $34 – an $85 billion valuation. But they settled down to around $31.50 after that and have mostly stayed around that level since then. But something caused the shares to surge past that old record to a solid $35 per share in this week’s auction. Our guess is that newly public LinkedIn’s somewhat impressive P/E ratio of 2,500 may have something to do with it.
$35 per share values Facebook at roughly $87.5 billion. Which is a steal compared to the way the public markets are valuing LinkedIn.
Posted: 27 May 2011 06:08 PM PDT
Actually, that’s not entirely true. We still have a ton of backstage talks and other footage we’re editing and processing, so expect more Disrupt content over the next week as we post these candid interviews with CEOs and Battlefield competitors. In the meantime, enjoy this central repository of all things Disrupt NYC 2011.
Interviews, panels, and Fireside Chats (with video and transcript):
Battlefield session one: disrupting search and discovery:
Do@: a slick search engine that searches using apps instead of the web
Battlefield session two: disrupting location, location, location
SpotOn: recommends places to go nearby, based on your own social network information
Battlefield session three: disrupting commerce
SneakPeeq: a social shopping site that counts down prices until someone buys an item
Interviews, panels, and fireside chats:
Battlefield session four: disrupting the real world
Desmos: a platform for rich educational content
Battlefield session five, disrupting enterprise
Getaround: rent nearby cars or put yours up for rent, with a special keyfob and app
Battlefield session six, disrupting something else
Lumier: no one is quite sure what Lumier is – possibly a skin for Windows
Interviews, panels, and fireside chats:
The final Battlefield session
From 30 awesome demos came six extra-awesome finalists. We were impressed by every startup that made the stage, but those final six really blew our socks off. Congratulations to all the companies, with special mention to Billguard, ccLoop, Do@, InvoiceASAP, and Sonar — and, of course, the Disrupt NYC 2011 Winner (and Audience Choice Winner), Getaround, which captured the Disrupt Cup with its killer car rental marketplace. Not to mention that they brought a Tesla, which always helps.
And of course, thanks to all our attendees, sponsors, and team members, who all help make Disrupt possible. This was the biggest yet, and we think it was also the best. See you next time.
Posted: 27 May 2011 05:10 PM PDT
For as long as I can remember, there has been one app that has constantly held the top paid app spot in Apple’s App Store: Angry Birds. Sure, other apps surge to the top briefly. But Angry Birds always comes flying right back. But a new app appears to be bucking that trend. Today is day 3 of The Heist‘s reign, and sales are quickening.
As The Loop noted after a partial day 1, The Heist saw download numbers just over 25,000. This was already enough to overtake Angry Birds. But what’s really remarkable are the day two numbers. There were 89,798 downloads of The Heist on day two. Again, that’s for a paid app ($0.99).
There are 86,400 seconds in a day so… yeah, the app is selling at a pace better than one a second. Crazy.
In total, that puts downloads now well north of 100,000, and revenues are nearing $100,000 already. In fact, they’re likely well past that number as I write this seeing as the app is also still the top-grossing app in the App Store.
So what is fueling the surge? Well first of all, they had a good launch strategy. The team behind The Heist is the same team behind MacHeist, the popular OS X software bundle. They began hinting about The Heist game earlier this year, and actually hid clues in the initial version of Twitter for Mac (which they had a deal with).
That proved to be enough to push it to number one, past Angry Birds, Tiny Wings, and other insanely popular apps. And getting to number one has its own perks. Because everyone sees you’re number one, they get curious and want to download your app as well, which led to the day two surge.
Well that and the fact that the puzzle game is getting excellent reviews across the board.
The tap tap tap team behind the app is also behind the truly great Camera+ app, which happens to be the number seven paid app in the store. In other words, these guys know how to make good apps — and money.
You can find The Heist here in the App Store.
Posted: 27 May 2011 01:54 PM PDT
Munch On Me is a daily deals site for food. But wait, before you click away to a slideshow about hot coders, Munch On Me (Y Combinator Summer class of 2011) has got some features that might just reroute you from relying on the big G for your munchies back to its sweet sweet embrace.
First of all, Munch On Me focuses on giving discounts on specific dishes, instead of on anything in the entire restaurant. Any business who’s been a victim of the Groupon effect knows why this is important, namely because restaurants can prepare for the demand in advance, overloading on the inventory they expect will sell out.
The Munch On Me discount focuses only on one item, and restaurants can upsell after the initial sale (“Would you like fries with that free milkshake?) and can keep offering up deals. Customers can redeem their deals immediately, a food industry-specific convenience that Groupon seems to have caught onto with its Groupon Now concept.
Because it takes less of a cut than Groupon, Munch On Me can get merchants to give out larger discounts as well as items for free in hopes of bringing more people into the store.
Says co-founder Jason Wang, “We were surprised in the beginning too, but merchants are willing to give out ‘freebies’ since we focus on dishes and not the entire menu. It drives a significant amount of traffic to the establishment. For example, when we ran King Pin Donuts in Berkeley, CA for a week, 1,573 people claimed a free donut when it was limit 1 per person.”
But the startup also makes money, “We don’t always offer 100% off. We sell individual dishes as well. For example, when you visit the Featured Dishes page in Berkeley right now (http://munchonme.com/index.php?l=berkeleyeastbay), [and] these cost money for users.”
Munch On Me also has another, more unique competitive advantage to Groupon. Banking on the fact that restaurants can’t take stellar pictures of their own food (food pics are a big deal), it sends out a professional photographer to get the job done.
You can currently peruse 2-4 Munch On Me deals a week in San Francisco and in Berkeley.
Posted: 27 May 2011 01:12 PM PDT
Most options for wood used in decks, outdoor furniture and siding are rarely entirely earth friendly, since they are often treated with heavy metals or toxic chemicals, or logged from unsustainable forests. One company is innovating in the space by altering the chemistry of the wood itself to make it weather and decay resistant.
After several years of research and development, Accsys Technologies began producing Accoya, a treated wood designed for outdoor exposure. The process uses acetylization, a chemical reaction that bonds together the hydroxyl group of molecules in the wood and replaces them with an acetyl group of molecules. The hydroxyl group is what microorganisms feed on, a cause of rot and decay, says Lisa Ayala, who represents Accsys’ North American branch. It is also what causes wood to shrink and swell.
To perform the molecular swap, wood goes through a vessel where heat, time and the addition of acetic anhydride creates a byproduct called acetic acid. In its simplest form, acetic acid dilutes to vinegar.
“When people smell the wood, they say it smells like pickles,” Ayala said. Less than 1% of the acetic acid remains in the wood after treatment, though even this small amount can cause zinc-plated or galvanized steel fasteners to corrode. The company offers recommendations on what kinds of fasteners and glues have been successfully tested with the treated wood.
Accoya could be used in place of pressure-treated wood, although Ayala said the company sees itself as more competitive with tropical hardwoods such as teak and ipe. According to the company, Accoya wood requires less maintenance than its tropical counterparts, and comes with a 50-year warranty for wood used above ground.
Currently, the company only sells products made from Radiata Pine, though it is exploring other species. The Netherlands-based factory hopes to expand production into other countries, where it can offer wood made from trees native to each area.
Accoya sells its products through distributors in 25 countries. The wood is generally more expensive than something like red oak, but is as much as half the price of teak or ipe, said Royal Plywood Company Materials Consultant Bruce Halvarson.
“No natural moisture can penetrate that wood,” Halvarson said. “If you try and put a water based stain on it, it won’t take at all, but an oil based stain will wick all the way through the wood from one side to the other.” Since the wood is treated from the inside out, it can be cut and modified in a variety of ways without compromising protection.
Posted: 27 May 2011 12:26 PM PDT
This 6-inch screen displays black and white e-ink text and images at 800×600 pixels and can roll around a tube the circumference of a dime. If this isn’t the future of print, I don’t know what is.
Designed and manufactured by Polymer Vision, the screen can be rolled and unrolled 25,000 times. The question, obviously, is why would you need a rollable display? Well, as ereaders become ubiquitous the need for them to be almost indestructible. I could see a day when kids get their own ereaders for the nursery a la the Diamond Age. Interestingly, Polymer Vision isn’t the company of note when you think of e-ink displays so either they will license this technology or they could start taking more and more market shares from leaders like Eink.
Posted: 27 May 2011 12:02 PM PDT
When it comes to building a web startup, the devil’s often in the details. And keeping track of those details — be it how far users get in your signup process, or how often they’re clicking a certain button — can be a real pain.
Mixpanel is a startup that’s looking to solve that problem by giving sites an easy-to-integrate analytics solution. And today it’s announcing that it’s raised another $1.25 million from an all star roster of investors, with new investors including Sequoia Capital (Jim Goetz and Roelof Botha) and Keith Rabois. That’s in addition to existing investors Max Levchin and Michael Birch, who are themselves experts at tracking viral data. The company previously participated in Y Combinator and raised $500k from Birch and Levchin in Feburary 2010.
Unlike traditional analytics services that focus on page views and uniques, Mixpanel is all about on-page actions: how many times users are activating a feature, how far in a flow they’re getting, and so on. All of this is tracked in real-time.
The startup’s customers include Quora, Bebo, and Slide (which has continued to use the service even after the Google acquisition). Cofounder Suhail Doshi says that they now are tracking data for 2000 sites, many of which are mobile. Not all of these are paid though — Mixpanel also offers a free plan that tracks 25,000 data points per month. Paid plans begin at $150 per month, which includes 500,000 events.
Doshi says that the company is already generating a significant amount of revenue, with double-digit revenue growth each month. The funding, he says, will be used toward expanding the engineering team and to make their work environment “the best place for engineers” (sidenote: I’m hearing this mantra more often as the hunt for engineers becomes ever more competitive).
Aside from the funding news, Mixpanel hasn’t had much news in the last several months, but Doshi hints that we’ll be hearing some major product announcements over the next six weeks.
Posted: 27 May 2011 11:24 AM PDT
Quora co-founder Charlie Cheever not only doesn't want to sell his hot start-up but – as he told me backstage earlier this week at Disrupt – he even has an explicit non-goal of not selling the company.
Non-goals or not, Cheever has a lot to smile about. Traffic is up to record levels at Quora and the site continues to be a paragon of innovation in the social space. In this interview he explains the difference between Quora and Wikipedia, and we get into many other orthogonal discussions as well. But I wonder if Cheever is tempting fate by having such an explicit non-goal. After all, he'll look ‘a right Charlie’ if Quora gets snapped up in the frenzy of acquisitions that will probably mark the post LinkedIn-IPO social marketplace.
Posted: 27 May 2011 10:52 AM PDT
With WWDC quickly approaching, the rumor mills are heating up with what we should expect at Apple’s annual conference known for big announcements. We’ve learned a little bit more that speaks to what to expect — including a couple of big, widely-requested things.
First of all, a lot of sites seem to be working themselves into a tizzy about the so-called “iPhone 4S”. While it has already been widely reported that there will not be any major hardware announcements at WWDC this year, people seem to be letting their imaginations get the best of them anyway. This site, for example, notes that Apple is pushing for British journalists to fly out for WWDC. And today, there’s a report about Australian journalists getting the same message. Both conclude this must be for the “iPhone 4S”.
As Electricpig writes:
In no way is that an obvious conclusion. I’m not disputing the fact that Apple’s iPhone PR team wants people at this event. But guess what else that PR team is in charge of? iOS.
Apple is Apple — they may always have a “one more thing” up their sleeve. And at least one of our sources still thinks that Apple will surprise with some new iPhone hardware. But right now, we’re not buying it. All other (solid) indications are that there will still be no hardware announcements at WWDC. None. And the extension of invitations to journalists in no way indicates anything different.
Instead, we’re hearing that Apple is pushing for journalists to come to WWDC because the software announcements will be huge (and they likely know that journalists hearing there will be no iPhone 5 announcement may choose to stay home instead this year). And the changes will be vital for all developers in the Apple ecosystem(s) to know about.
And remember, this isn’t just about iOS 5. This is about Apple’s entire software backbone. iOS and OS X are both about to receive massive upgrades at the same time. And both will likely be extensively previewed at WWDC. Add to this Apple’s cloud announcements (which may or may not include the “iCloud” music stuff) and you suddenly have a WWDC that looks anything but boring, new iPhone or not.
The second bit of information we have heard is about iOS 5 itself. First of all, while we’ve been leading the reports of Nuance technology being fully baked into iOS 5, one place we’ve heard it won’t be used (at least not yet) is Voice Control. That’s odd since it’s perhaps the most obvious usage. But apparently, in the builds of iOS 5 currently being tested, the little-used feature hasn’t changed at all, we hear.
That could obviously change before the release (which is still likely months away, even though it will be previewed at WWDC), but apparently the Nuance technology is meant for bigger things more core to the OS than that one feature.
The other big news for iOS5 — and yes, I’ve completely buried the lede here, thanks for reading! — two things: completely revamped notifications and widgets.
Expect a lot more in a couple weeks. Obviously, we’ll be there live covering the event.
Posted: 27 May 2011 09:35 AM PDT
Late last year, travel search engine Kayak filed for an IPO, aiming to raise $50 million. The company just released a new version of its S-1 today, with updated financials. The company plans to list its stock on the NASDAQ under the symbol "KYAK."
For the three months ending March 31 of this year, Kayak generated $53 million in revenue, which is up 43 percent from the same period in 2010. The company actually lost money in the quarter in terms of income, with a loss of $6.9 million. Adjusted EBITDA was $8.2 million.
In the filing, the company said it took a loss of $15 million in January 2011, when Kayak migrating traffic from www.sidestep.com to www.kayak.com. Kayak bought rival SideStep for $196 million in 2007. Because Kayak shut down SideStep’s site and URL, the company incurred a write-down of $15 million in the first three months of 2011.
From January to March, Expedia and its affiliates, including Hotels.com and Hotwire, accounted for 26 percent of Kayak’s revenues, followed by Orbitz, which accounted for 14 percent of Kayak’s revenues for the time period.
For the time period ending March 31, Kayak processed more than 214 million user queries for travel information, representing growth of 48 percent from 2010 and Kayak mobile applications have been downloaded over seven million times since March 2009. From January to March, Kayak saw one million downloads of its mobile apps, which include iPhone and Android apps.
While Kayak isn’t minting money, it’s probably a good sign for investors that the company is at least growing revenue.
One the risks Kayak identifies in the fling relates to Google’s acquisition of flight search software ITA Software. Kayak says that one of its risks is that it depends on a third-party (ITA) to query airfare results. Kayak licenses faring engine software from ITA under an agreement which expires on December 31, 2013.
ITA provides a large chunk (56 percent) of Kayak’s airfare query results and 29 percent of its airfare query results from January to March were obtained from other sources that used ITA. Basically, if Kayak somehow couldn’t use ITA’s software, it would be a big negative for the company. But Google cannot prevent licensing access to ITA’s software from third-parties, according to the DOJ mandate that pushed the $700 million deal through.
Kayak also acknowledged that with ITA’s technology, Google may also create other flight search tools and services that directly compete Kayak. Kayak is afraid that Google will include a better version of ITA’s software, that Kayak won’t have access to. From the filing: These services offered by Google could include enhancements or improvements in performance of the ITA software which may not be made available to us, such as improved performance that significantly increases the speed at which their software returns search results. Although the consent decree requires Google to renew our existing ITA agreement on the same terms, if ITA or Google limit our access to the ITA software or any improvements to the software, separately develop replacement software to which they claim we are not entitled or increase the price we pay for any improvements of replacement software and we are unable to replace ITA's software with a comparable technology, we may be unable to operate our business effectively and our financial performance may suffer.
Posted: 27 May 2011 09:14 AM PDT
Yesterday, PayPal filed a lawsuit against Google and two of its executives for stealing trade secrets. The lawsuit came on the same day that Google announced its mobile wallet plans involving Android phones with NFC chips. The two executives, Osama Bedier and Stephanie Tilenius, previously worked at PayPal. In fact, Bedier was in charge of negotiating a deal with Google on behalf of PayPal for inclusion of PayPal as a payment mechanism in Android phones. The deal fell through and Google hired away Bedier instead, who then helped build Google’s own mobile wallet product.
At least that is PayPal’s side of the story. Last night, I asked Google for a comment. It took them a while, but a spokesperson just emailed me the following statement:
“Silicon Valley was built on the ability of individuals to use their knowledge and expertise to seek better employment opportunities, an idea recognized by both California law and public policy. We respect trade secrets, and will defend ourselves against these claims.”
Let’s parse this statement a bit. Google is saying that talented employees should be able to take their knowledge with them as they “seek better employment opportunities.” In other words, people can work wherever they want, and Google is a much better place to work than PayPal, so if Bedier wanted to switch jobs, who can blame him?
Sure, they can take their knowledge, but they can’t take trade secrets. Google says they “respect trade secrets,” so you can imagine they will be arguing that what Bedier brought along in his brain was just general industry knowledge and not any trade secrets specific to PayPal.
High-profile employment disputes are nothing new in Silicon Valley. When Apple poached IBM’s Mark Papermaster to head up its chip development, IBM sued. The two companies eventually settled out of court. In many ways, this is a PR move on PayPal’s part more than anything else. It is not like they are going to get an injunction to stop Google from going into mobile payments. But it’s a bad PR move because it shows exactly how scared they are that Google is going to succeed.
For some more background on what’s at stake, watch the video below from earlier this week at Disrupt when Stephanie Tilenius was on a panel at Disrupt that I moderated about the future of online-to-offline commerce.
Photo credit: Flickr/Henk-Jan Winkeldermaat
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