Startups

Microsoft’s announcement of its Xbox One video game console landed with a thud on Wall Street, where the company’s shares are falling this morning. Other reactions have focused on what Microsoft didn’t talk about (it’s saving a lot for E3 in June) and consumer rights issues that it didn’t fully address. Unfortunately, stock traders are reacting to the partial information that Microsoft released yesterday, and they’re not inclined to care if Microsoft was keeping its powder dry until the official E3 press conference June 10. Microsoft touted features such as the integration of Kinect motion and voice controls into the heart of the system and the addition of new entertainment services and Skype. It showed glimpses of games such as Call of Duty: Ghosts (with exclusive downloadable content), EA Sports titles, and Microsoft’s own Quantum Break, promising they would look awesome. It touted clever hardware innovations such as cloud processing, which uses data centers to complement the processing power inside the machine. It also said it would integrate SmartGlass app controls into the system. Instant Kinect command recognition is Microsoft’s main selling point for how entertainment will become better on Xbox One. But those features didn’t capture a lot of the headlines. Analyst Michael Pachter of Wedbush Securities said in a research note that he liked what he saw so far but details that will determine long-term success will likely have to wait until the E3 trade show in June. Ben Schachter of Macquarie Research wrote there were great new features in Kinect integration for multimedia, some exclusive content and a confirmed 2013 launch. “However, we saw nothing earth-shattering, and there was no word on pricing, not that we were expecting pricing just yet, which we think will be absolutely key in determining the pace of adoption beyond the initial launch surge,” Schachter wrote. “If a low initial-cost subscription model is announced at E3, it would be a meaningful positive in our view.  If not, we may need to wait and see if any key must-have platform-exclusive features or titles appear.” Colin Sebastian, an analyst at Baird Equity Research, said that Xbox One should “be a contender in the living room battle.” He called the “all-in-one” living room box a “significant upgrade.” “We view the broad capabilities of the Xbox One as likely to appeal to a broad market, although price remains an important unknown,” he wrote. That battle isn’t just about games but in countering the incursion of iOS and Android platforms into the living room and overall consumer behavior. “Overall, we believe the Xbox One reveal demonstrates that Microsoft has a capable platform in the living room battle, even if there is a narrow window of opportunity to build share before other platforms gain a foothold,” he said. Based on reaction in forums, Xbox One hardcore fans appear to be upset about Microsoft’s failure to address three issues that go to the heart of a consumer’s “rights” when it comes to buying and owning their games and consoles. Microsoft said there would be no backward compatibility for Xbox 360 games, not even the digital versions of games downloaded from the Xbox Live Arcade. Microsoft also said there would be limitations on the trading of used games, though it offered a vague promise that it would have a solution for second-hand trading of games. And Microsoft conceded that, while the machine does not require an always-on connection, you will have to log into the internet about once a day to keep the console and games updated. Kotaku’s Luke Plunkett raised those issues in a story headlined “That Xbox One Reveal Sure Was A Disaster, Huh?” Indie game developers expressed disappointment over the lack of self-publishing of apps on the platform. Rob Fahey wrote for Gam

Chrome 27 for the desktop arrived yesterday and today, Google updated Chrome for Android to version 27 as well. While the desktop update mostly focused on improved speed, the Android version actually includes a number of new features. The most important of these is probably the new fullscreen mode for phones. Just like in the iPhone app (or in the old stock Android browser), the toolbar will now disappear as you scroll down. Also new in this version is a somewhat simplified search experience: searching from the omnibox, Google says, will “keep your search query visible in the omnibox, making it easier to edit, and show more on your search result page.” The company has been experimenting with a similar feature in the desktop version of Chrome. It essentially turns the omnibox into the search interface instead of switching to the URL for your search and then replicating the search interface it on the search results page. On the desktop, this always takes me for a loop, but given the space constraints on a smaller screen, this will probably allow for a few more lines of search results to show without the need to scroll down. Other new features in this update include support for client-side certificates (something that’s often needed to connect to enterprise intranets) and tab history support for tablets (so you can use a long press on the back button to bring up your tab history.

Skyhigh Networks discovers,manages and analyzes data from all the apps that people use at work. Today the company raised $20 million in a Series B round led by Sequoia Capital with participation from existing investor Greylock Partners. Skyhigh discovers, analyzes and controls the cloud services that a customer’s employee uses. It sees the cloud services customers use and all the associated security issues associated with it. It analyzes the services to find the abnormalities and ways the company can save costs on subscriptions. It also adds an element of control by enforcing IT policies. The difference for Skyhigh is in the fine grain controls. When it finds abnormalities it can provide encryption, access control and other security features. The discover is based on existing logs and data from proxy and doing analytics. It has a registry of 2,600 services with 500 added every six weeks. For each service they create an independent score across 30 criteria. For the analysis the company has a Hadoop infrastructure. For the control the company has a reverse proxy and associated services it runs through its data centers. The company is about 18 months old. It raised a Series A round last March from Greylock. Skyhigh will primarily use the funding for sales, marketing, and engineering. Skyhigh has a platform that provides services with aspects of what you see in something like Splunk. It’s a market that security providers might serve as potential competitors. Skyhigh is leveraging the bring your own device movement (BYOD), which it addresses at its intersection with the thousands of services employees use but can’t afford to keep exposed to security risks.

Zite was one of the first companies to answer cries from loyal Google Reader users when the service was shuttered back in March, building a “replacement” in six hours. Yet in the news reader’s latest iOS app update, Zite’s management team makes one thing very clear: it’s time to let Google Reader die. At its core, the CNN-owned Zite is sort of the anti-Google Reader, anyways. Google Reader pulls in RSS feeds from any news website as they become available, which creates an unruly fire hose of content with a bland, basic design that most people couldn’t possibly keep up with at the end of the day. Zite, on the other hand, curates news from the best publications on the web using your preferences and arranges them in a visually pleasing digital magazine layout. “We realized we didn’t need to shift focus of the company for the next two months trying to build a Google Reader replacement because we already did that in 2011 with Zite,” Zite CEO and founder Mark Johnson said in an interview with VentureBeat. “I think part of the reason Google Reader’s death was so prominently covered was because a large group of Google Reader users were people in the media. A very small portion of people — reporters, analysts, VC’s and news junkies — are actually benefiting from seeing every single one of those articles in one place.” I tend to agree with Johnson’s assessment, as I had a front row seat when my boss Dylan Tweney and colleague Sean Ludwig communicated their frustrations over Google Reader going away. I imagined them pulling their hair out trying to find a replacement. [Useless editorial note: Not counting Canadians, all the men on VentureBeat's editorial staff have -- or have the ability to grow -- full heads of hair, but Google Reader's death almost changed that.]  But those that just want a good mix of articles from trusted sources that can reasonably be finished without having to block out half a day on the calendar, Zite already did a pretty good job of delivering. The latest update, however, makes some important tweaks to the user experience that will help ease those former Google Reader fans into Zite’s news curation service. Zite allows users to “thumb” up or down on articles, but now you’ll be able to see a prominent list of sources that you’ve “thumbed up” in the topic drawer (aka category or section) — sort of like a list of favorites. You’ll also be able to click-through to any of those sources to read and vote on everything they’ve published recently. All content that you’ve read will now appear grey to signify what you’ve consumed previously — a nod to Google Readers bold/grey headlines. And finally, Johnson said it wants to fix the problem Google Reader had with burying really good content from sources that published something only once or twice a week (or month) by giving it a higher placement within Zite’s magazine layout. That means the algorithm for news curation is changing slightly to unearth what would be the best content from a Google Reader account with hundreds of headlines collected from lots of handpicked sources/publications. “The goal is to give Zite more of a magazine feel that’s inviting, not a huge list of headlines and photos,” Johnson told me. Zite is also rolling out more diverse “story cards” that helped break up what’s shown on the screen. For instance, some topic drawers will have only headlines and photos from sources while others may feature a headline and a good pull quote from an article, which I’m guessing is similar in scope to how Flipboard presents content. The big point to make in regards to Google Reader is that there isn’t a flawed display that’s exactly the same for every story, since a one-size fits all approach really doesn’t work when dealing with con

Zalora, the Zappo’s-like fashion and beauty store for south-east Asia, announced this morning that it has closed a $100 million financing round. That’s a lot of lipstick and high heels. Zalora focuses on 10 countries in Asia: Singapore, Indonesia, Malaysia, Brunei, the Philippines, Thailand, Vietnam, Taiwan, and Hong Kong. The year-old startup says it has already achieved “annualized double-digit million USD revenues.” “Our company is one of the fastest growing e-commerce companies in South-East Asia and has bright prospects,” said Michele Ferrario, Managing Director. “It is an honor for us that investors of such great repute have invested into an e-commerce company as young as ZALORA.” It is indeed an honor when a year-old startup with two or three million dollars in annualized revenue scores a $100 million investment. An unusual honor, as well. But there’s method behind the madness. The investment was secured by the German holding company that owns Zalora, Rocket Internet, which claims to be “the largest, fastest and most successful international online venture builder.” Founded by the infamous Samwer brothers — who Jason Calacanis has called “despicable thieves” —  its modus operandi has been to take successful models from American startups and apply them globally. Genius, perhaps, if not very original. And very, very successful. Rocket Internet sold Groupon clone CityDeal to Groupon for $126 in 2010 and eBay clone Alando to eBay for $50 million, among many other lucrative deals. That history is undoubtedly part of what led the investment group, led by Summit Partners, Investment AB Kinnevik, and the Verlinvest and Tengelmann Group, to participate in this $100 million round. Source: Rocket InternetRocket Internet’s impressive portfolio of companies A big chunk, 25 percent, of Zalora’s revenue comes from mobile commerce, and the company says its app is the top lifestyle app in all the countries it serves, and the top app overall for Singapore, Malaysia and Vietnam. In other words, Rocket Ventures saw an opportunity to take a big slice of an emerging market, and is moving rapidly — and with massive investment — to own the space. The capital will be used, Zalora said, to scale up operations and grow the number of local and international brands it carries. The company has just delivered its millionth order. photo credit: AehoHikaruki via photopin cc Filed under: Business, Deals, Entrepreneur, Lifestyle, Mobile

Sept. 9 - 10, 2013San Francisco, CAEarly Bird Tickets on Sale Elastic cloud infrastructure startup Cloudscaling has raised $10 million in its second round of funding so it can keep growing at a quick clip and innovating its cloud technology. San Francisco-based Cloudscaling was founded in 2006 and claims to be “the leader in elastic cloud infrastructure.” Its core product is the Open Cloud System, an OpenStack-powered cloud infrastructure application that can give companies the same benefits of cloud infrastructure providers like Amazon Web Services and Rackspace. But unlike those companies, Cloudscaling’s solution is deployable in a client’s data center under an IT team’s control. It can also run its solution on Amazon and Google’s public clouds if a customer wants to do so. In April, Cloudscaling announced version 2.5 of Open Cloud System. Some of its newest customer wins include LivingSocial, EVault, Ubisoft, and DataFort. The new funding was provided by prior investor Trinity Ventures and new investors Juniper Networks and Seagate. Prior to today, Cloudscaling had raised $4 million back in Sept. 2011. “This financing round caps a tremendous year of momentum for the company,” Cloudscaling CEO Michael Grant said in a statement. “That momentum affirms the voice of the market, clearly stating that customers want more than OpenStack. They want an on-premise, OpenStack-based private or public cloud turnkey system solution that delivers architectural and behavioral fidelity with major public clouds like Amazon Web Services. Our Open Cloud System product delivers on that need to enable hybrid cloud application deployments that span private and public cloud services.” Clouds photo via Flickr Filed under: Cloud, Deals .blurb-cat-cloud .event-boilerplate { width:278px; margin:0px 0px 10px 20px; padding:10px; float:right; border:1px solid #e4e4e4; font-family: 'Open Sans', sans-serif; color:#000; } .blurb-cat-cloud .event-boilerplate .logo-date-wrap { width:100%; display:block; float:left; margin-bottom:8px; } .blurb-cat-cloud .event-boilerplate img { float:left; } .blurb-cat-cloud .event-boilerplate .date-location { float:right; font-size:12px; line-height:14px; text-align:center; padding-left:7px; padding-top:5px; padding-bottom:3px; border-left:1px solid #e6e6e6; } .blurb-cat-cloud .event-boilerplate .cta { display:block; clear:both; width:100%; border-radius:5px; border:1px solid #1864b1; color:#fff; text-shadow: 0px -1px 0px rgba(0,0,0,0.3); text-align:center; text-decoration:none; font-weight:600; font-size:18px; line-height:17px; padding:4px 0px 6px 0px; background: #1f80e4; background: -moz-linear-gradient(top,  #1f80e4 0%, #1862ae 100%); background: -webkit-gradient(linear, left top, left bottom, color-stop(0%,#1f80e4), color-stop(100%,#1862ae)); background: -webkit-linear-gradient(top,  #1f80e4 0%,#1862ae 100%); background: -o-linear-gradient(top,  #1f80e4 0%,#1862ae 100%); background: -ms-linear-gradient(top,  #1f80e4 0%,#1862ae 100%); background: linear-gradient(to bottom,  #1f80e4 0%,#1862ae 100%); filter: progid:DXImageTransform.Microsoft.gradient( startColorstr='#1f80e4', endColorstr='#1862ae',GradientType=0 ); }

July 9-10, 2013 San Francisco, CA Early Bird Tickets on Sale Have you ever tried to find your way through the inside of a sprawling Las Vegas Strip hotel? The odds are good you got lost and stopped at a table to gamble. The casinos may like it that way, but Lighthouse Signal Systems figures that consumers don’t. The company is launching its indoor positioning system as an Android app so you can find your way through the vast indoor terrain of Las Vegas’ hotels and casinos. Indoor navigation is one of the last major tasks that smartphones have to conquer. Outdoor navigation works great thanks to satellite fixes via the global positioning system (GPS). But GPS doesn’t work indoors, and it’s hard to find consistent WiFi signals and other ways to navigate inside buildings. But Cambridge, Mass.-based Lighthouse Signal Systems is now launching its service covering 20 million square feet of entertainment and retail space at leading casinos and hotels on the Las Vegas Strip. Among the early adopters is Caesars Entertainment, one of the major casino chains. Lighthouse is making its service freely available to Android app developers, resort operators, retailers, and others seeking to enhance the visitor experience in Las Vegas. Indoor navigation is a Holy Grail for the mobile industry, and Lighthouse says it is the first to provide GPS-like indoor positioning on a wide scale in a major U.S. metro. “We are excited to support app developer partners as they create new mobile experiences with indoor positioning in Las Vegas where large resort interiors have traditionally presented a vexing challenge for visitors,” said Lighthouse co-Founder Parviz Parvizi. The theory goes that casinos want you to get lost so you spend more money. But Parvizi says that multi-resort holding companies expect to prosper from cross-property circulation, and navigation can help that happen. Even within individual properties, consumers want a better experience finding things. “Providing location-based services does not really reduce how much time people spend at the resorts but instead has the potential to enhance the overall experience,” he said. “From a resort owner perspective, the time that a visitor spends wandering around being lost is a wasted opportunity that could be better and more profitably spent on gaming or entertainment.” Lighthouse’s platform includes indoor geofencing: a hosting platform for location-based offers and user analytics. Caesars has conducted early trials with the service. Lighthouse plans to expand to malls and retailers at major top 20 metropolitan areas. With the app, users are specifically asked to opt-in. And developers are not able to use the service to track mobile phone users without user consent. Others trying to this include Google, Cisco, Ekahau, Euclid, Shopkick, PoinInside, Aisle411, Sensionlab, Indoor.rs, Yfind, and CSR. The company has five employees, including co-founder Mohammad Heidari, who studied the issue at Worcester Polytechnic Institute. The tech has been in the works for several years. The first patent was granted this year. The technology is in the market today. Lighthouse uses a combination of WiFi fingerprinting and sensor data. So long as there are WiFi networks in the area, Lighthouse can provide positioning info. The service is free for developers who are experimenting. As volume picks up, Lighthouse will charge fees. Filed under: Business .blurb-cat-mobile .event-boilerplate-mobilebeat { width:278px; margin:0px 0px 10px 20px; padding:10px; float:right; border:1px solid #e4e4e4; font-family: 'Open Sans', sans-serif; color:#000; } .blurb-cat-mobile .event-boilerplate-mobilebeat .logo-date-wrap { width:100%; display:block; float:left; margin-bottom:8px; } .blurb-cat-mobile .event-boilerplate-mobilebeat img { float:left; } .blurb-cat-mobile .event-boilerplate-mobilebeat .date-location { float:right; font-size:12px; line-height:14px; text-align:center;

SparkLabs, the startup accelerator that wants to inject South Korea’s startup ecosystem with Silicon Valley expertise, announced its second intake today. Its latest class is an international lineup of companies that represent a variety of sectors and are at widely different stages of funding, from bootstrapped financing to those that have closed a Series A round. Founded in 2012, SparkLabs’ offers a three-month-long mentorship driven program. Co-founder Bernard Moon says that one of the main challenges faced by South Korea’s startup industry is the lack of role models and guidance for founders. For example, many angel investors and venture capitalists have a financial background but lack entrepreneurial experience. SparkLabs has focused on building an impressive roster of mentors, many of whom are Silicon Valley founders. “We’re not the first accelerator or incubator in South Korea, but we are the first with a tangible outside network that is easily accessible by Korean entrepreneurs,” says Moon. “We also get applications from China, India, Taiwan, everywhere in Asia. Our dream is to be a gateway not just into Silicon Valley, but also to high-level people these founders never thought it would be possible to access.” While SparkLabs’ first class consisted of South Korean companies hoping to break into overseas markets, the latest intake include companies from Singapore and the U.S. that view South Korea as a gateway into Asia. “They see South Korea as more developed in terms of technology and a large early adopter base. A good foothold and feedback in South Korea helps them expand into Japan and possibly China,” says Moon. SparkLabs is also hosting its first annual conference, NEXT, on June 14 in Seoul. The event will focus on innovation and technology, with speakers including Ray Ozzie, the founder and CEO of Talko, Richard Florida, author of “The Rise of the Creative Class,” Maria G. Gotsch, president and CEO of Partnership Fund for New York City and Jonathan Levine, CIO and CTO of Rakuten Group. SparkLabs’ inaugural cohort included educational tech startup KnowRe and WePlanet, the developers of Step Journal. Here is its second class: StyleWiki: A Seoul-based social wiki platform for fashion enthusiasts. iBabyBox: A Palo Alto-based online community where parents can share and sell secondhand baby products. Megaphone: Founded in New York City, this participation TV platform’s clients include NBC, Bravo, BBC, Amex, LG, Sprint, NFL and the New York Knicks. Megaphone integrates game graphics that can be controlled by Web browsers into TV shows and allows viewers to see aggregated results of all user activity and 30-second ads in real-time. MangoPlate: A mobile app that offers personalized restaurant recommendations in Seoul. Its search engine fine-tunes results each time a user adds a review or wish-list entry. Zoyi: A Korean tech company that has built products including AdbyMe, Korea’s first social media advertising platform and Cooki, a news summary curation service. Zoyi is backed by Southbridge Capital, a leading Korean venture capital firm. HeyBread: One of Korea’s leading curation commerce companies, HeyBread focuses on delivering premium organic breads from local bakeries to customers. The company plans to expand its service to the entire fresh food industry. Petsbe: A Seoul-based premium subscription service that delivers personalized orders of pet food and monthly supplies. Lateral: Headquartered in San Francisco, Lateral wants to redefine the fundamentals of online search by revamping outdated search methods. DesignPlusD: A Seoul-based productivity app that includes note taking, alarm reminder and calendar functions. The company’s Remember-Block memo app was the App Store’s number one productivity apps in 12 countries and was the top paid app in South Korea during January. TrakInvest: A Singaporean online s

Thanks to Amazon, writing fanfiction about popular television show characters just became more than a passionate hobby that earns you ridicule from friends and co-workers. Today the online retail and digital media store announced a new publishing platform called Kindle Worlds that allows anyone to write their own, original stories based on licensed content from a number of TV shows currently airing on the CW and ABC Family — the two channels best known for angsty hour-long dramas adapted from young adult book series. Under a deal between Amazon’s publishing arm and Warner Bros. Alloy Entertainment division, fanfiction authors can publish stories about Gossip Girl, Pretty Little Liars, and Vampire Diaries within Amazon’s Kindle store. Not only that, but those authors will even earn a royalties when people buy their work. So to recap, Amazon just MONETIZED FREAKING FANFIC. Also, this has the potential to let some people earn a living off of fanfiction, although that’s not likely to happen anytime soon. (And I think it’s worth noting for the record that “professional fanfic author” is something I never realized I’d be addressing as a VentureBeat reporter. But here I am, and here it is.) Royalty rates are actually pretty reasonable under the Kindle Worlds platform. Amazon will pay copyright owners of the original work an undisclosed percentage, while the author of the new stories will get a 35 percent cut of net revenue on each sale, provided that the work is at least 10,000 words. Amazon is basing net revenue off of the sale price, and not the wholesale price that traditional book publishers offer authors — meaning authors should get a better payout if successful. Authors of stories that are under 10,000 words can earn a royalty of 20 percent off of net revenue, with most stories priced at $1 or less. And Amazon said royalty payments will come once a month. Amazon said it plans to announce additional licensed works for the new Kindle Worlds platform in the near future. Kindle Worlds itself will launch on the Kindle store in June with more than 50 commissioned stories from best-selling authors like Barbara Feethy, John Everson, and Colleen Thompson. So basically, that means regardless of if you’re already an established author who wants to write their own original story derived from a licensed work, Amazon just made it a hell of a lot easier. Beyond the new opportunities Kindle Worlds creates for authors, Amazon also points out that this is a new revenue stream for licensed content. I wouldn’t bet on seeing Kindle Worlds grab licensing deals with lucrative works such as Star Wars and Star Trek, but copyright owners of franchises that don’t do much book publishing will certainly be interested. Top image via The CW Filed under: Media

A few months ago I bought an external 3TB hard disk for our home computer, mostly for my wife’s 53,000 photos. Turns out that if I had just waited, I could have simply uploaded them all to MyShoeBox. “We offer unified photo storage across all your devices, for free, at 1,024-pixel quality,” founder Steve Cosman told me a few weeks ago in Toronto. “Or, you can pay $5/month for unlimited resolution.” Today MyShoeBox is launching version two of its photo backup and sharing service, with a new iPad app, updated mobile apps, and a new shared galleries feature that allows you to build grouped sets of photos with people you went on vacation with, or family members who shared an event such as a wedding. The freemium model has helped the company get a quick start. Source: MyShoeBoxSearch and self-quantification After exiting from Toronto accelerator Extreme Startups in Fall last year, the service saw 13.4 million photos uploaded in its first month, November 2012. And, Cosman says, MyShoeBox users upload far more photos than Facebook or Flickr users — 3,200 each, compared to Facebook’s 220 and Flickr’s 320. But the value proposition is much more than photo backup. Instead, MyShoeBox is a way to enjoy all of your photos, all of the time, on any device you have. Frankly, for most people, their photos are strewn around their main computer (photos from their actual, official, camera), their phone (snapshots from their built-in camera), and their social networks (uploaded from wherever you happened to be at the time). There’s no unified view, no way to see — and search — all your photos at once. Using MyShoeBox for the first time syncs your photos up to the cloud-based service automatically, in the background, and installing the services’ mobile apps on your Android or iOS-based phone will do the same. That’s helpful, because we often want to see more of our photos on our mobile devices. “Our new iPad app is an incredible way of browsing your entire photo collection,” Cosman says. “And it’s one of the only ways you can get your full photo collection on your iPad … most people don’t have enough space.” What most interested me when I chatted to Cosman is MyShoeBox’ solution to a problem that I think I share with many other digital photographers: enjoying your own work, and finding photos. A former program manager for Microsoft’s augmented reality team for Windows Phone, Cosman has placed special emphasis on automated sorting, tagging, and exploring features. “So many people that have given up the concept of a photo collection,” he says. “Faces, places, and things are important ways to automatically categorize photos. And they keep getting smarter every day.” So MyShoeBox highlights places you’ve been, photos you took last year at this time, events, cameras you used, and more, creating what the company calls “an interactive infographic” of your life. That includes personal quantification data like the top times you take photos, and your most photographed neighborhoods. And if you want to search your photo collection, MyShoeBox has just re-written its search features to be much faster and more powerful as its power users often have more than 15,000 photos each. “iOS, Android, Windows, Mac … it works pretty much anywhere,” Cosman says. “And once together, it’s automatically organized.” MyShoeBox is based in Toronto, Canada, and is currently raising a financing round. Image credits: MyShoeBox Filed under: Business, Cloud, Lifestyle, Mobile, Social