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January 6, 2012

Fun facts from Millennial Media's IPO filing

Did you hear? Baltimore's Millennial Media filed to go public yesterday, letting everyone know they hope to raise $75 million from Wall Street to fuel their mobile ad business's growth (and make its founders and early investors rich.)

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Up above, those are co-founders Chris Brandenburg (left), chief technology officer, and Paul Palmier, chief executive officer.

Below are some fun facts from Millennial Media's S-1 registration statement with the SEC for its initial public offering:

* Quite literally, the money paragraph (note the improvement in gross margin) and the rapid closing of the gap from a $7 million loss in 2010 to a $417,000 loss in the first nine months of last year: "From 2009 to 2010, our revenue increased from $16.2 million to $47.8 million, or 195%, our gross margin improved from 29% to 34%, our net loss improved from $7.6 million to $7.1 million and our adjusted EBITDA improved from a loss of $7.0 million to a loss of $6.4 million. For the nine months ended September 30, 2011 as compared to the same period of 2010, our revenue increased from $29.1 million to $69.1 million, or 138%, our gross margin improved from 33% to 39%, our net loss improved from $5.4 million to $417,000 and our adjusted EBITDA improved from a loss of $4.9 million to earnings of $650,000."

* Employee growth: "We grew from 54 employees at December 31, 2008 to 190 employees at September 30, 2011." And more up to date: "As of December 31, 2011, we had 222 employees, of which 72 were primarily engaged in product and technology and 69 were engaged in sales and marketing."

* Fascinating chart of the ramp-up in spending among the top 100 advertisers with Millennial over the last three years:


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* The top four executives at Millennial are all over 30 -- and the CEO Paul Palmieri and COO Stephen Root are over 40. (Sorry for pointing this out, Paul and Stephen. But I think it should be made clear Millennial's success as a startup so far is because of some relatively veteran executives, not fresh-faced kids out of college.)

* Those four executives earned this much money in 2011:


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* Co-founders Paul Palmieri and Chris Brandenburg own 11.3 percent and 9.2 percent, respectively of outstanding shares in Millennial. Investment firms Bessemer Venture Partners and Columbia Capital are tied for the top shareholder spot, at 20.6 percent each.

* Millennial's five-year lease at the American Can Co. complex in Canton is up in July 2013. It's paying between $21 and $22 per square foot for 16,000+ square feet of space. It's annual lease has gone up from $201,000 in the first year, to $361,000 in its final year of the lease.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

June 27, 2011

Bam! A Glen Burnie tech company just raised $35M

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It's not everyday -- or every week -- that a Maryland company can boast that it raised $35 million from investors. Honestly, I can't say I see that kind of private money tossed at a company much at all here in the Free State, as someone who follows this kind of stuff. (Oh, but how I wish it were more frequent....)

But today at least, Glen Burnie-based Novasom Inc. can be the braggart. For people who suffer from sleep problems, such as sleep apnea, Novasom has a gadget for you.

The company has a device on the market that measures and diagnoses sleep apnea in a suffering sleeper. These devices are not sold to the general public, but rather shipped to patients at their homes, and covered under certain insurance plans (Novasom essentially makes money from "renting" the device as a service to patients who are covered by insurance.)

The patient uses the device to take measurements when they sleep at nigh over three dayst, and then ships the device back to the company, which shares the data with your medical providers.

Here's what's cool about Novasom: this company is actually making a device, a piece of hardware, and they have a business model. They've hired a 100+ people in the last few years. And did I mention they're actually making a tangible product, and not just another Facebook competitor?

Making an actual piece of stuff doesn't guarantee success in the U.S., and software has been insanely popular lately (App Store anyone?). But economists like to see hardware getting made, especially since it can lead to demand for more and new software.

A few months ago, I was told by Roger Richardson, Novasom's vice president of operations, that the company is making a next-generation device that will enable the electronic delivery of your sleep data over a wireless telephone connection, i.e. a 3G network. No need to wait till it gets shipped back for a data download. And yes, this device has all the regulatory approvals for use.

Imagine if Novasom can get approval to do other sorts of medical-related-things with their wirelessly connected devices. There's a bigger market potential here than just sleep apnea sufferers.

So, the news today is that Novasom raised a new round of investment -- $35 million worth -- led by Safeguard Scientifics Inc., with participation from existing investors including TPG Biotechnology II Fund and Quaker BioVentures.

It plans to use the new money to "fund growth, expand its leadership position in payer and provider markets, and develop additional innovations within the company's proprietary NovaSom(R) diagnostic medical device and cloud-based MediTrack(R) Patient Management Portals."

Novasom, which used to be known as Sleep Solutions Inc., has been around since 1992 and had been based in California. The company moved to Glen Burnie in 2008 and uses a Baltimore County company, Zentech, as its contract manufacturer for its devices.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

June 13, 2011

NEA Partner: Creating a "virtuous cycle" of investment in Maryland

david-mott-NEA.jpgNew Enterprise Associates is one of the heavyweights in the world of venture capital and, lucky for me, they're right in my backyard here in Maryland.

I had a wide-ranging interview today with David M. Mott, NEA partner and former head of MedImmune, the biopharma success story based in Montgomery County, Md.

Mott and NEA invest billions far afield from Maryland, hunting for promising companies across the country and around the world. Lately, he and NEA have been doing deals in India and China, getting involved in services and infrastructure business in those developing countries, such as outpatient treatment centers for oncology and diabetes, Mott said.

Back home in the U.S., Mott observed that Maryland needs more big company success stories such as MedImmune and Human Genome Sciences, where top management and entrepreneurial thinkers from such organizations spin out and start their own businesses.

We've seen some of this effect in Baltimore with the success of Advertising.com, and the spinoff of talent that have led to some new businesses, most notably Millennial Media.

In Montgomery County, this type of "virtuous cycle" has started taking root, according to Mott. Baltimore, not so much -- yet. But Mott touched upon something that I tangentially covered, coincidentally, in my latest story this weekend about startups and business accelerators.You need  entrepreneurs and trained leadership talent -- those who have the "social capital" to convince weary investors of investing in them --  to roll up their sleeves and embark on new startup projects.

What Mott and others at NEA look at when they invest are the quality of management teams. They like to cultivate entrepreneurs and even new technologies, according to Mott.

What may not be as well known is that NEA funds its own virtual incubators, where talented brains work on new medical devices in-house at NEA, leading sometimes to funding and new companies.

"Over half of our investments are internally generated by entrepreneurs in conceptual virtual incubators," Mott said. "We back them to come up with ideas."

NEA has had six medical device companies spin out into their own businesses in the last few years, Mott said. NEA also has launched a seed fund to make investments ranging from $50,000 to $500,000, according to VentureWire.

Mott couldn't talk publicly about the seed fund, but it looks like the kind of move that NEA is making to compete in the angel and "super-angel" end of the investment pool, where there's a lot of activity at the moment.

Startups are also going from conception to high-flying much more quickly, so NEA and other VCs apparently see some necessity in interacting with some of these young companies just as they're forming.

Wait too long as a VC and suddenly, before you know it, startup valuations are through the roof.

I asked Mott the cheap nickel-and-dime question that every tech journalist is asking today: are we in the midst of another tech bubble?

He said he mostly didn't think so. Valuations are wild in a few specific niches, such as social media, but others, such as biopharma and healthcare (his specialty area), are fairly normal, he said.

"These businesses, unlike back in 1999, have some significant revenues," Mott said. "They're becoming big businesses in very short periods of time...and with relatively little capital in a very short period of time, you can build a deep business."


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

May 27, 2011

Tech boom hits New York -- can Baltimore feel the aftershock?

The headline reads "New York startups ride tech boom."

It's the Wall Street Journal, and it's declaring that New York is experiencing boom times in its startup scene. Some may automatically -- and skeptically -- wonder that when a newspaper declares a boom, you know a bust isn't too far behind. I'm not ready to be that skeptical, yet.

As the article points out, there are a couple of different pieces in play in New York right now that's working in Silicon Alley's favor. There's talent, a mix of relative success stories, and a community of eager entrepreneurs fueling the ecosystem. Just as importantly, investors from Silicon Valley and elsewhere are now checking into the New York scene to grab on to any shooting stars that fly out of there, according to the article.

If there's a boom going on in New York, here in Baltimore, the startup scene is hoping for some positive aftershocks. There's still a fair amount of investment dollars flowing into the Washington-Baltimore region, but most of the money is going to that Northern Va./Washington corridor.

Many in Baltimore's tech scene were looking forward to the Startup City -- a business accelerator -- acting as a sparkplug for entrepreneurs and investors. But alas, that program has been postponed because enough investors couldn't be lined up, and the organizers are going back to the drawing board.

My rough sense about Baltimore is that investments are being made in biotech, cybersecurity and other targeted areas where there's money to be made, i.e. health care. Local angel investors seem to be less inclined to invest in popular consumer-facing apps and tech that captivate the general public, such as "the next Facebook" or "the next Twitter" or "the next Foursquare." The scene here is more B2B than B2C, which is fine, because there's money to be made in B2B -- it's just not as sexy to the average joe.

When you look at the latest stats from the National Venture Capital Association, the reality is that investments in New York and the DC-Metroplex (that includes us) were actually down in the first quarter this year.

You know who's up? Silicon Valley. And Texas (Austin, anyone?). And Philadelphia (kudos to our neighbor's startup scene). And the U.S. southwest.

Here are investment numbers for the 1st quarter of 2010, from the National Venture Capital Association:


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Now here are similar stats for this year's first quarter:


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These numbers make me wonder if venture capital is just heating up in Silicon Valley, driving valuations ever northward, and forcing VC's and angels to go looking for smart companies and smarter deals in other tech hotbeds.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

May 18, 2011

LinkedIn IPO frenzy -- would you buy the stock?

The coming LinkedIn IPO -- expected tomorrow -- may be a resounding success, as frothing-at-the-mouth investors appear eager to throw their money at big social media companies. The company is expected to prices its shares tonight and make them available on the stock market tomorrow, under the New York Stock Exchange ticker LNKD.

Potential share price: $42-$45.

Potential valuation: ~$4.25 billion.

So, here's the question: Would you invest in LinkedIn? This Reuters article outlines some of the risks in the marketplace for LinkedIn, including the fact that it has struggled with losses and profitability.

What happens when LinkedIn becomes directly accountable to Wall Street when it's public? Will it cut expenses and investment in future growth drastically to produce better profit margins?

In this Bloomberg video, Jonathan Merriman, a tech investor, explains the LinkedIn IPO and talks about the risks. Interesting stuff:



This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

April 21, 2011

Drug-dealing robots in Baltimore

Not illegal drugs, silly.

In case you missed it, I wrote about a Baltimore-area company that spent $30 million on robotic technology that automates the dispensing and packaging of pharmaceuticals for institutional clients, such as nursing homes and assisting living facilities. Mind you, these aren't humanoid robots -- rather, they're bulky, heavy, boxy beasts.

The company is called Remedi SeniorCare, and it's run by Michael Bronfein, who built up NeighborCare into a national player in the institutional pharmacy business. (Institutional pharmacies basically supply medications to, what else?, institutions, such as nursing homes, hospitals and even prisons.)

I got a tour of Remedi's facility in Rosedale, with these incredible robotic automatons that pretty much eliminated the need for humans handling, packaging and labelling thousands of medication orders per day. Pretty incredible stuff.

Here's my story on the company and the industry it's playing in. Like my headline?

And below is one angle of the robot, known as the Paxit system.

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This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 3:17 PM | | Comments (0)
Categories: Big Ideas, Gadgets, Venture Cap
        

April 19, 2011

410Labs: Baltimore startup attracting outside investors

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We've seen Dave Troy roll up his sleeves and help coordinate and promote Baltimore's tech scene over the last couple years, helping pull off such events as TedXMidAtlantic and BarCamp Baltimore.

He's also dabbled in politics lately, with a public endorsement of Otis Rolley, who's running for mayor in Baltimore.

But the local entrepreneur, who founded and sold ToadNet, an ISP, is coming on strong this year with a new startup venture. It's called 410Labs. The company is all about building nimble communication tools that make managing your flow of digital information better, whether its with Twitter or email.

A new tool that Troy and his colleagues demo'ed at the Baltimore Startup Weekend event is called Mailstrom, which helps people analyze and manage their email inboxes.

Last week, Troy tweeted that his company was receiving some investments to keep doing its thing. So far, 410Labs is about halfway through a $500,000-plus angel round of investing. And its attracted investors from San Francisco, Baltimore, Washington DC and possibly even New York.

Here's a short Q&A I did with Dave recently:

Q) Who are the principals in 410Labs?

A) David Troy, CEO; Matt Koll, Chairman (sold two companies to AOL). We also have two full-time developers and one part-time employee who have a stake in the company.

Q) What do you build?

A) We're building products that add value to people's lives using technology. So that's pretty broad. Our first product, Replyz, helps people find answers to questions. Our second product, Shortmail, is experimenting with innovations in email, which hasn't seen much innovation in a very long time. We anticipate having about four products in our portfolio by the end of the year.

Q) Why take investment?

A) We're not taking much, and the investments are strategic in nature. We want to build support within our industry, both in San Francisco and here in Baltimore. So it's really more about relationships, but this will also allow us to hire people and move faster than we have been. We also appreciate the vote of confidence and insights that we gain by working with outside investors.

Q) How much currently raised and how much targeted?

A) We are raising $500-$600K in this current round and are about half done. As I said, the investments we have secured so far are firmly in the "Angel" category.

Q) Who are your investors? (Is it Twitter and Living Social, per se, or individual executives from those companies?)

A) I can't speak to it in full before we close the round, but individuals at both Twitter and Living Social have committed to angel investments in the company. It's going to be a nice mix of people in San Francisco, Baltimore, Washington DC, and probably New York.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

January 28, 2011

Howard County-based Internet video distribution startup raising millions

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A startup named LiveTimeNet Inc., of Savage, Md., has filed to raise $5 million in its latest round of financing efforts, according to Securities and Exchange documents.

LiveTimeNet, which was founded in 2007, specializes in Internet video content transport and delivery, using its own nationwide managed IP network, according to its website.

It boasts that its service outperforms both satellite and terrestrial transport services. The firm has two patent applications for its technology. And it's raised millions in financing over the last two years. In its latest round of financing, LiveTimeNet is seeking to raise $5 million in equity, and has already raised $1.37 million.

Last year, it raised $3.5 million in equity financing. And in 2009, it raised $2.5 million, according to SEC filings.

Clearly, somebody sees something special in this company, which currently appears to consist of three executives: Malik Khan, co-founder, chief strategy officer and chairman of the board of directors; Yousef Javadi, co-founder, chief executive officer and president; and Professor Yair Amir co-founder and chief science officer.

All three men appear to be experts in broadband communications networks, and Amir is also a professor of computer science at Johns Hopkins University. Any companies out there using LiveTimeNet's services?


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 10:21 AM | | Comments (0)
Categories: *NEWS*, Big Ideas, Entrepreneurs & Risk Takers, Venture Cap
        

January 26, 2011

InvestMaryland event starts 9 a.m. Thursday - watch live here!

InvestMaryland is an initiative by Gov. Martin O'Malley to use state tax revenues -- to the tune of $100 million over five years -- from the insurance industry to fund venture capital investment in Maryland technology companies.

The goal of the initiative, which still has to be debated and approved by the General Assembly this year, is to fuel a self-sustaining cycle of investments in early-stage businesses in the state. The problem, many believe, is that there isn't enough money in the private sector for investment in early stage businesses -- hence the reason why public policy makers want to prime the pump, so to speak.

For a full rundown of the program, read my article here.

On Thursday, Jan. 27, the O'Malley is hosting "InvestMaryland" day in Annapolis, where business leaders and tech geeks will gather to discuss and presumably promote the plan. Below, you can watch a live video feed of the proceedings, starting at 9 a.m. Tune in if you care.

Watch live streaming video from ChooseMaryland at livestream.com



This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 4:59 PM | | Comments (0)
Categories: Events (Baltimore area), Government Tech, Venture Cap
        

January 24, 2011

O'Malley's plan to jump-start venture capital in Maryland

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It's not every year we get to see a big plan for small start-ups in Maryland. But that's what Gov. Martin O'Malley will be unveiling today, with his "InvestMaryland" proposal. It's a $100 million infusion over the next five years of state tax revenues into small Maryland-based, technology-based startups. It's not a total giveaway of revenue; rather, the state will be taking stakes in dozens of small companies over the next several years, and then hopefully, watching their investment grow as these companies grow and raise more money, merge, get acquired or go public with an IPO.

I took a close look at the plan in this article over the weekend. Below are the opening paragraphs:

Hoping to spur jobs, innovation and economic growth, Gov. Martin O'Malley wants to tap tax revenue to invest $100 million in fledgling technology, life sciences and other companies across the state.

O'Malley, a Democrat, plans to unveil details of the "Invest Maryland" program Monday as a centerpiece of his economic agenda in this year's General Assembly session. The state would invest in small businesses and start-up companies — partially through the dormant Maryland Venture Fund — and would reap both the risks and rewards.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

January 13, 2011

10-20 Media raises $800K to continue home and garden data venture

10-20 Media, a Howard County firm, this week raised $800,000 in debt financing, which it will apparently be pouring into its business as a "home and garden marketplace data aggregator," according to an SEC filing this week.

The company has an iPhone app called GardenPilot, which puts 14,000 choices of flora from multiple retailers into the hands of consumers. It also builds online tools that helps retailers show off their offerings on their websites.

The $800,000 round is the latest of multiple investments in 10-20 Media over the past two years. The company has raised a combined $1 million in debt through three previous filings.

By the way, the term 10-20 is a trucker/CB radio term signifying your location.

Below is a snapshot of the Garden Pilot app.

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This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

January 5, 2011

Baltimore biotech Gliknik raises $3.5 million

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More good news for a Baltimore startup today: Gliknik Inc., which is based in the University of Maryland BioPark, announced that it completed a $3.5 million equity financing raise. The money was raised over the course of the past seven months, the company said.

Gliknik is a biopharmaceuticals company that plans on using the new funds to initiate a clinical program in autoimmune diseases for its Stradomer platform, which are recombinant drugs. The company is working to create new treatments for cancer and immune disorders.

"An infusion of investor funding highlights a growing vote of confidence as we continue to develop new therapies for patients with cancer and autoimmune/inflammatory diseases," said David S. Block, Gliknik's president and chief executive officer. (Block is pictured above.)

Over the past six months, Gliknik has also received an additional $1 million in competitive grant funding from a federal program, a U.S. Army subcontract, and a Maryland Department of Business and Economic Development research award.

Gliknik also announced that it received a patent from the U.S. Patent and Trademark Office for one of its drug programs for fighting cancer.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 11:26 AM | | Comments (0)
Categories: *NEWS*, BioTech, Entrepreneurs & Risk Takers, Research, Venture Cap
        

Millennial Media, hot on mobile ad trail of Google/Apple, raises $27.5 million

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Pictured: Millennial Media co-founders: Chris Brandenburg (left) and Paul Palmieri



Millennial Media, a Baltimore startup that's a top player in the growing mobile advertising industry, said Wednesday it raised $27.5 million in new investments from several venture capital firms, which it will use to continue to fund its growth.

The new funding round was Millennial's largest since it was founded more than four years ago. It has raised more than $65 million from investors. The new money comes from several existing investors in Millennial, including Bessemer Venture Partners, Columbia Capital, Charles River Ventures and New Enterprise Associates.

The company said that it plans to use the new equity investment to fund the company's global growth plan this year. It also plans to build on its acquisition of TapMetrics, a mobile analytics company it acquired last year, and consider additional acquisitions this year.

The new funding comes as Millennial, which is competing toe-to-toe in the mobile display advertising market with Google Inc. and Apple Inc., said it tripled revenues last year, though the privately held company does not disclose specific revenue figures.

A recent report by market research firm IDC showed that Millennial had 15.4 percent of the mobile display advertising market, behind Google (19 percent) and Apple (18.8 percent). Mobile display ads are showed to cell phone users while they are perusing other content, usually on mobile websites.

The company says its mobile ads reach more than 85 percent of mobile users in the United States. The total mobile ad market was estimated at more than $1 billion last year, and is expected to grow quickly over the next few years.

The mobile ad market attracted Google and Apple, who have both bought competitors of Millennial for hundreds of millions of dollars. Several months ago, Millennial was rumored to be in acquisition talks with Research in Motion, maker of BlackBerry smart phones, but the negotiations reportedly fell through.

Paul Palmieri, Millennial's chief executive and co-founder, sees the mobile advertising industry applying to many different kinds of devices, from smart phones and tablet computers to appliances.

"The mobile model continues to expand beyond the phone, and is becoming the new, device based Internet via apps on everything from refrigerators to tablets to televisions," Palmieri said in a statement to The Baltimore Sun.

Millennial currently has offices in New York, London, and San Francisco, plus sales offices in Detroit, Los Angeles, Chicago, Dallas and Atlanta.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

December 14, 2010

Growing Bwtech@UMBC, from life sciences to cybersecurity

Frank Turano was a biology and genetics researcher and professor tied to George Washington University, while his wife was a professor specializing in sensory systems at the Johns Hopkins University School of Medicine.

When it came time for the couple to launch their own startup, they looked around Maryland for public and private incubators and ultimately decided on Bwtech at the University of Maryland Baltimore County.

“We looked for support to grow a business,” said Turano, who launched Plant Sensory Systems three years ago, a small firm that investigates how to modify plant genes so they produce more biofuel and require less fertilizer. They have five full-time employees now.

“We liked the track record here,” Turano said.

While the University of Maryland, Baltimore and Hopkins have attracted headlines in recent years for developing bioparks in the city, the Bwtech Research and Technology Park has been chugging along for more than two decades, steadily expanding the number of companies and employees that call it home.

More recently, Bwtech officials are targeting cybersecurity, striking a partnership with Northrop Grumman last month to attract researchers and experts who could launch their own companies.
Cybersecurity is currently white-hot in academia, at least among Maryland’s public campuses.

Gov. Martin O’Malley’s administration is trying to push the state into the forefront of the industry, drawing on key government facilities in Maryland, such as the National Security Agency at Fort Meade.

The University of Maryland, College Park recently created the Maryland Cybersecurity Center to promote education, research and technology in the sector. The University of Maryland University College this year launched bachelor’s and master’s degree programs in cybersecurity.
Bwtech@UMBC — as it is known in shorthand — is among 20 publicly sponsored incubators across Maryland.

Across the country, incubators have grown popular as a way to counteract the effects of a punishing recession. With some early funding, hardworking entrepreneurs and investors are taking bets on future growth during a down economy.

Startup companies are attracted to incubators for a variety of reasons, including the potential for low rent, a collaborative working environment with like-minded professionals and guidance from industry veterans.

The Bwtech park, spread across six buildings on two campuses on more than 40 acres, has focused on helping launch startups in the life sciences industry and clean energy. Five of the buildings in the Bwtech North campus, in Catonsville, have been built within the past decade and feature newer office space.

A sixth building, Bwtech South in Halethorpe, was formerly the Martin Marietta research lab, which the state bought in the mid-1990s. The sprawling building near Route 195 is home to Bwtech’s life sciences incubator companies. This building houses companies that have a need for lab space.

Three years ago, the companies that were based at Bwtech numbered more than 900 employees. Today, more than four dozen companies and research organizations employ more than 1,200 people, officials said.

Fifty-two companies, or 91 percent of Bwtech’s incubator companies since 2000, are either still in operation or have been sold, while a small percentage went out of business, according to program statistics.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech

October 13, 2010

CashFlow: some startups that raised cash

dollar-sign.jpgHere's the latest edition of CashFlow, my weekly spotlight on some technology companies across the country that raised money for their ventures:

* Care.com: This Waltham, Mass.-based company raised $20 million, in a funding round led by New Enterprise Associates. Care.com provides an online site for people to find caregivers for children, adults, seniors and pets.

* Microstaq: This Austin, Tex.-based company raised $10.2 million and is seeking to raise another $8.4 million. It makes electronic fluid control technology that "reduces energy consumption in air conditioning systems by up to 25 percent."

* Philo Media Corp.: This New York City-based firm raised $1 million. It's a website that allows TV watchers to tap into their social networks and share and talk about what they're watching. Like Foursquare, you get "rewarded" for your participation on the site.

* Glowpoint Inc.: This Hillside, NJ company raised $1 million. The company offers telepresence and video conferencing services for businesses looking to save money on meetings and travel.

* Quick Hit Inc.: This Foxborough, Mass.-based company raised $2.5 million. It built an online, NFL-backed football game, which integrates with social networks. (Anybody play with it?)


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 9:50 AM | | Comments (0)
Categories: *NEWS*, Startups, Venture Cap
        

July 20, 2010

Tech firms' mergers signal potential growth

Check out Gus' story in today's Sun on recent mergers and acquisitions in the Baltimore tech scene.

Two technology firms in the Baltimore area merged with out-of-state competitors last week, part of a trend that analysts hope will mean more deals after corporate financing had been crimped by the recession.

In one of the deals, eMagination, among the largest and oldest Internet development companies in the city, was acquired by a Massachusetts company for $4.3 million. And Owings Mills-based AirVersent Inc., a company that makes supply chain software, merged with a Pennsylvania company but didn’t release financial details of the deal.

The acquisitions came on the heels of other Maryland technology companies turning to Wall Street to raise money through initial public offerings.

While no one is predicting a return to headier days, industry analysts are forecasting an uptick in technology deals. PricewaterhouseCoopers predicted earlier this year that mergers and acquisitions in the tech sector would increase compared to last year.

More technology companies also are expected to turn to IPOs this year, meaning that investors in early stage companies stand a chance of recouping their investment and potentially funneling more money into new projects, according to PricewaterhouseCoopers.

“I’m definitely seeing an improvement in activity,” said Rick Kohr, chief executive of Evergreen Capital LLC, a corporate finance advisory firm in Columbia. “But everybody is more methodical than they might have been in 2007 or 2006.”

As companies merge and are acquired, investors can free up investment capital and use it to fund new companies, said Matthew Gorra, a law partner in DLA Piper’s corporate and securities group. And news of just a few deals can trigger a herd mentality and a deal spree.

Companies start to look at mergers and acquisitions as a necessity to keep pace with their competition, he said. Other companies may see the economy improving and want to jump at the chance to acquire a complementary company as an opportunity for quick growth.

“There were a lot of people trying to wait it out last year,” Gorra said. “This year, people are more willing to make investments.”

With credit markets still relatively tight, small and young companies are struggling to finance their growth and might have investors who are looking for a return on their investment — thus the pressure to merge or be acquired, industry observers said.

On the IPO front, SafeNet Inc. of Belcamp, which specializes in cybersecurity, recently disclosed plans for a stock sale and hopes to raise $300 million. Bridgeline Digital Inc. of Woburn, Mass., bought eMagination last week. eMagination builds websites and electronic commerce programs for commercial and government customers and reported sales of $5.4 million over the past year. Bridgeline promoted the deal as a way to expand its client base into the government sector.

Airclic Inc. of Trevose, Pa., a suburb of Philadelphia, merged with AirVersent Inc. of Owings Mills in a deal that creates a profitable company with revenue of $22 million a year, executives said.

Rick Pontin, Airclic’s chief executive, said the two private companies, both of which specialize in software that helps firms manage mobile workforces, didn’t overlap in terms of customers and they were starting to see more demand for their services.

“There are a lot of mergers and acquisitions when markets are about to come back,” Pontin said. “People are thinking about how they can grow the business.”

 


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Liz Hacken at 12:24 PM | | Comments (0)
        

June 17, 2010

Baltimore's Arginetix merges with Immune Control Inc. to form Corridor Pharmaceuticals

And now, the latest in biotech news........

Baltimore-based Arginetix Inc. announced today that it is merging with Immune Control Inc. of West Conshohocken, Pa. to form Corridor Pharmaceuticals Inc. -- a company that will focus on developing treatments for vascular diseases.

The new company will develop treatments based on technology platforms developed by both Arginetix and Immune Control. The chief executive of Arginetix, Gary Lessing, will serve as the CEO of Corridor, according to a news statement issued this morning. Stephen Roth, formerly CEO of Immune Control, will be executive vice chairman of Corridor's board of directors. Arginetix licensed technology from the University of Pennsylvania and the Johns Hopkins University.

In addition to the merger, Corridor announced that it had secured new financing totaling $15 million to fund its operations. The company has a drug candidate called C-122 that treats pulmonary arterial hypertension, and proceeds from the financing will be used to advance the drug into clinical development.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 9:43 AM | | Comments (0)
Categories: *NEWS*, BioTech, East Coast, Venture Cap
        

October 9, 2009

How to raise money for your tech startup

Dave Troy here with Kris Appel, our guest blogger for today. Kris is the founder of Encore Path, a medical technology start-up in Baltimore.

As a first-time entrepreneur, raising the money to launch launch a medical device was a significant undertaking.

I am not only a first-time entrepreneur, but I chose to start a company in an unfamiliar field. I have a background in linguistics, but my company develops medical technology for stroke rehabilitation.

So I started this endeavor with two strikes against me. This month, I will close my Series A round, and my first product was launched this summer, a rehabilitation device that improves arm function in survivors of stroke and other brain injury. Here is how I was able to attract investment:

Continue reading "How to raise money for your tech startup" »


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Liz Hacken at 4:29 PM | | Comments (3)
        

September 28, 2009

Optimism among angel investors and venture capitalists

Last week, I surveyed the startup scene in the Mid-Atlantic region, writing a story that showed how brutal it's been in the past year for entrepreneurs.

More recently, I got a heads up from the National Association of Seed Venture Funds that they conducted a survey at their annual conference in mid-September in Oklahoma City. There were signs of optimism.

* 54 percent of attendees indicated the companies they support are hiring again
* 73 percent felt the economy was improving
* 73 percent don't believe proposed health care legislation will slow entrepreneurs from starting businesses
* 87 percent believed more tax incentives to invest in early-stage companies will spur growth.

The three industries expected to attract the most growth: biotechnology, clean technology and health care. The industries that will have a tough time raising capital? Electronics, financial services, and manufacturing.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 7:00 AM | | Comments (0)
Categories: Venture Cap, Venture Cap
        

Optimism among angel investors and venture capitalists

Last week, I surveyed the startup scene in the Mid-Atlantic region, writing a story that showed how brutal it's been in the past year for entrepreneurs.

More recently, I got a heads up from the National Association of Seed Venture Funds that they conducted a survey at their annual conference in mid-September in Oklahoma City. There were signs of optimism.

* 54 percent of attendees indicated the companies they support are hiring again
* 73 percent felt the economy was improving
* 73 percent don't believe proposed health care legislation will slow entrepreneurs from starting businesses
* 87 percent believed more tax incentives to invest in early-stage companies will spur growth.

The three industries expected to attract the most growth: biotechnology, clean technology and health care. The industries that will have a tough time raising capital? Electronics, financial services, and manufacturing.


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 7:00 AM | | Comments (0)
Categories: Venture Cap, Venture Cap
        

July 1, 2009

An Italian biotech consultant's shock, awe and questions

Last week here, I wrote about a rush of small Maryland start-up biotech companies to get in line for a generous state tax credit that was available for investors in the nascent industry. ("Maryland biotech companies crazy for tax credits!")

An Italian biotech consultant saw my post and was shocked -- shocked! -- by what we were doing here in Baltimore, Md. She wanted to know more. (She shot me an email. You'll see it below.)

To quickly recap: biotech companies started lining up Friday morning at the University of Maryland's BioPark in Baltimore to wait in line. The tax credits are doled out by the state every year on a first-come/first-served basis. Last I heard yesterday, 17 companies had stationed representatives in line, in an auditorium at the BioPark, to camp out for five days -- just so they could submit their applications for the tax credit this morning at 9 a.m. (I'm still waiting for the final headcount on how many submitted today.)

Several of the company reps I interviewed lauded the state for offering big tax breaks to drive investment in biotech here. One company, Noxilizer, told me how they were able to attract investors who live in other states, because of the tax credit. Few states have anything like this "Biotechnology Investment Incentive Tax Credit" program to kickstart the biotech industry, they told me.

About $36 million has gone into funding biotech startups over the past three years -- with half of it tax-free for investors, according to the Maryland Department of Business and Economic Development.

What's happening in the state's biotech industry will eventually come under more scrutiny in the future (Gov. O'Malley has a Bio202 initiative to build up the industry over the next 10 years), as the public, politicians and business leaders will expect concrete results after all this investment, including new job creation and blockbuster products. (Mary Spiro ponders this future in her post on Maryland biotech's "boom or bust.")


Now, for the email from Valeria Spagnoli, a self-described biotech consultant in Italy who wants some more insight from biotech companies in Maryland on how they're going about getting funding from the state. Who wants to help her with her questions?

Hi,

I’ve just read the article about tax break for biotech investors on the BIO smartbrief newsletter. I found it amazing that companies line up days before the application time opens up, they just sign their names on a blackboard…In my country we are overwhelmed by the so-called red tape procedures, papers and papers to fill in, this is why I would appreciate if you could provide more detailed information to this regard, such as: how are companies selected as beneficiaries? Just the first come first served basis ensures they are granted the money? How long does it take to become eligible?

Thank you so much for your kind reply!
Have a nice day!
Valeria

P.S. to Valeria: As my full story points out, there's only a limited pool of money -- $6 million this year -- so once it runs out, no one can get more funding. Each investor is entitled up to $250,000 in tax credits and no company can claim more than 15 percent of the total tax credit pool of $6 million. That said, there are some other nuances that maybe others closer to the process can jump in and explain for all of us.

(Published June 1, 2009)


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 10:45 AM | | Comments (0)
Categories: BioTech, Entrepreneurs & Risk Takers, Startups, Venture Cap
        

June 25, 2009

Maryland Tech: Protecting your computer screen from the "shoulder surfers"

billAnderson.jpgEvery once in a while, I get to see -- and sometimes write about -- a fascinating new product before the consumer masses get to it. It's one of the cool perks of being a journalist, really.

That happened to me recently, when Bill Anderson (left) of Oculis Labs Inc., in Owings Mills, gave me and some colleagues here at The Baltimore Sun a demo of his new software: "Chameleon" and "PrivateEye." (Here's my full story on how he launched his company and came up with the idea.) 

Here's what Chameleon does: it uses sophisticated gaze-tracking technology to dynamically render the words and images on a computer monitor so that only the authorized user can read them. It's accurate down to about one single character. If someone is peeking over your shoulder (aka "shoulder surfing"), all they will see is dummy text that is constantly changing. You, the user, will be able to read the text you choose to read wherever your eyes wander on the screen.

I tried reading the documents -- a Word and an Excel document -- over Anderson's shoulder, and I could not. I had no idea where his eyes were and the text was constantly changing on me.  

For now, big government agencies involved in military/intelligence operations are the most likely ideal customers because it requires some special hardware (the gaze-tracking equipment), and the price tag ain't cheap. Anderson bills Chameleon as a way for people to protect their monitors, which can be critical in battlefield and intelligence operations, where super-spies with powerful telephoto lenses can peer over your shoulder from a very long ways away.

For consumers, there's a lighter-weight version, PrivateEye. Here's what that does: It taps into your computer's Web cam (that's the only hardware you need) and uses face-detection technology so that your computer knows when you turn away from the screen. As soon as you turn away, the screen softly blurs. Ideal for office situations where privacy of information is paramount, such as medical settings, financial institutions, law firms, etc.

Anderson gave us a tour of the software and we shot some video. Check it out below!


This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
Posted by Gus Sentementes at 1:46 PM | | Comments (8)
Categories: Gadgets, Government Tech, Startups, Venture Cap
        
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About Gus G. Sentementes
Gus G. Sentementes (@gussent on Twitter) has been writing for The Baltimore Sun since 2000. He's covered real estate, business, prisons, and suburban and Baltimore City crime and cops. He was one of the first reporters at The Sun to use multimedia tools and Web applications -- a video camera, an iPhone -- to cover breaking news. He hopes to cover Maryland geeks and the gadgets and Web sites they build, and learn -- and share -- something new every day.

Gus has a wife, a young daughter and two feuding cats. They live in Northeast Baltimore.
This is an archived version of the technology blog. For updated coverage, see the current baltTech location: baltimoresun.com/balttech
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