The Latest from TechCrunch |  |
- Update: Playdom Paid At Least $850,000 For Hive7
- Facebook Launches App Instead of ‘Panic Button’ For UK Kids
- NOOKstudy: B & Ns’ Foray Into The Education Market
- Study: Mixing School-age Kids And Computers Makes For Bad Stuff
- Skype Blocks, Threatens To Sue Fring (Update: Skype Says Fring Is Lying)
- Microsoft Rolls Out Azure Appliance, Partners With HP, Dell, eBay And Fujitsu
- Gowalla Gets A Spot On CNNMoney’s “Best Places To Live”
- Ubisoft Expects Everyone To Have A 3D TV By 2013 (Yeah, Right)
- Penguins Rejoice, Spotify Lands On Linux
- Monday Morning Update: Google And China, iPhone Class Action Certified
- Can A Startup Think Global Without Boarding A Plane?
- Performance-based Online Advertising Company Adsmarket Raises $17 Million
- The MP3Tunes Alternative To Paid Streaming Music: “Buy Anywhere, Listen Everywhere”
- Is Google App Inventor A Gateway Drug Or A Doomsday Device For Android?
- Deals Galore, Competitors Abound: A Primer On Groupon-Like Startups
- Apple Rolls Out Four More iPhone 4 Ads — Each About FaceTime
- Chicago’s Excelerate Labs Graduates Nine Startups
- This Mobile Payments Company May Self Destruct In 15 Minutes
- Wired City: Josh Harris’ Plan To Make Us All Live In Public (Video)
- Elon Musk: “Why Owen Thomas Is Silicon Valley’s Jayson Blair”
| Update: Playdom Paid At Least $850,000 For Hive7 Posted: 12 Jul 2010 09:09 AM PDT
A couple of weeks ago, game developer and Zynga rival Playdom continued its shopping spree just after raising $33 million in funding, acquiring social gaming startup Hive7. What Playdom spent to buy the True Ventures-backed company wasn’t disclosed, but thanks to an SEC filing we now know that it concerned a mixture of cash and stock. The exact amount Playdom paid for Hive7 in cash remains unknown, but the SEC filing reveals the stock part of the equation: $851,498 worth of shares were issued to help pay for the startup. Playdom has been on quite a shopping spree over the past few months. The company, which recently brought on a new CTO, has steadily been expanding its presence on Facebook and in the social gaming space, most recently acquiring MMORPG developer Acclaim Games, Facebook game developer Offbeat Creations and developer Three Melons. Playdom also invested $5 million in Facebook game developer MetroGames. And Playdom bought popular branded game developer Merscom. Last November, Playdom raised a massive $43 million at a $260 million valuation. In total, the company has secured $76 million in venture capital.      
|
| Facebook Launches App Instead of ‘Panic Button’ For UK Kids Posted: 12 Jul 2010 08:51 AM PDT  Facebook has often been criticised in the UK for not having a child safety 'panic button' and while a few media outlets are reporting today that it has launched one, the reality is somewhat different. What Facebook is launching is a tailor-made marketing application and campaign for a government body which till now had no presence at all on the social network. That's quite a different thing altogether. The move is the latest from the social networking giant to address its obligations to it's younger members. In the US it recently added a number of new safeguards to protect young users from sexual predators and cyber bullies. But till now it's been seen as something of a laggard. Both Bebo and MySpace bother have 'panic buttons and have been happy to tell the world about it. However, Facebook launched a new Safety Center in April and it's long argued - not unreasonably - that panic buttons imply that social networking is inherently dangerous, which would be a warped way of looking at things. The reality is that the media rarely checks these panic buttons out: Bebo's button just takes you to a 7 page form - not exactly what would might call an engaging way to address this issue. 
|
| NOOKstudy: B & Ns’ Foray Into The Education Market Posted: 12 Jul 2010 07:58 AM PDT
     
|
| Study: Mixing School-age Kids And Computers Makes For Bad Stuff Posted: 12 Jul 2010 07:53 AM PDT
Well now we have a modicum of proof. Some folks at Columbia University did a study in 2009 on a Romanian project designed to offer vouchers to families for computers. This kids who didn’t get a computer complained that they wanted a computer but little else changed. But the kids who got a computer:
     
|
| Skype Blocks, Threatens To Sue Fring (Update: Skype Says Fring Is Lying) Posted: 12 Jul 2010 07:01 AM PDT
Late last week, mobile communication services provider fring released an updated iPhone app that enabled iPhone 4 owners to engage in unrestricted 2-way video calling over Wi-Fi or 3G internet with other iPhone, Android or Symbian devices. This garnered a lot of attention, mainly because Apple’s native FaceTime application works only over Wi-Fi and between iPhone users. Hours after its release, the company said it saw a huge spike in video calling that it was forced to “temporarily reduce support” to Skype, a third-party provider it has long supported. Now, they no longer have to worry about that extra network strain, as fring says Skype has apparently blocked fring and threatened legal action against the startup. In a press release issued moments ago, fring says that it is thus being forced to stop its 4 years of Skype interconnectivity, referring to the move as an anti-competitive ambush. They go further than that in the complementary blog post, calling them out for being ‘cowards’:
We’ve contacted Skype and are awaiting an official response from the company. Update: a Skype spokesperson tells us that they’ve been debating with fring about whether they operate in accordance with its terms of use and license agreements for some time now, and that these discussions were ongoing. Surprisingly, Skype also claims the decision to no longer offer Skype interconnectivity was entirely made by fring and that they had nothing to do with it. Fring disputes this and say Skype demanded them not to restore access. The company’s spokesperson emphasized that they encourage developers to build products that work with Skype so long as they’re in accordance with its various licenses, and that they are keen on enforcing its terms when developers do not comply with them. Something tells me this won’t be the end of this particular story. Update 2: Skype just put up a blog post from its legal chief Robert Miller:
     
|
| Microsoft Rolls Out Azure Appliance, Partners With HP, Dell, eBay And Fujitsu Posted: 12 Jul 2010 06:57 AM PDT  During its annual Worldwide Partner Conference, Microsoft introduced (a limited production release of) the Windows Azure platform appliance, the company's cloud services platform for deployment in customer and service provider datacenters. The company is touting partnerships with some big-name early adopters of the appliance, namely Dell, eBay, HP and Fujitsu.
|
| Gowalla Gets A Spot On CNNMoney’s “Best Places To Live” Posted: 12 Jul 2010 06:46 AM PDT
Location-based social network Gowalla is teaming up with CNNMoney for Money magazine’s annual “Best Places To Live” list. The top towns on the list have their own Gowalla hot spots, which are linked to from each city profile. For instance, the top Gowalla hot spots in McKinney, Texas (No. 5) include the Landon Winery, Pub McKinney, and Coffee N Cream. If you are within 25 miles of the top 25 cities, a notification will pop up on your Gowalla mobile app directing you to the “Best Places” page. Partnerships such as this one with big media and brands are a good way to get more exposure for geo apps like Gowalla and Foursquare (which also pursues such high-profile partnerships vigorously). The partnership also adds a mobile component to an otherwise staid—albeit popular—list of best cities. CNNMoney is also incorporating housing data from Trulia on the Best Cities part of the site, as well as job listings from SimplyHired. People use these lists for research when they are thinking of moving, so bringing all of this data into one place is very helpful We are still in the landgrab phase of geo-social networks. These deals raise awareness of the apps and bring in new potential users. And for media properties looking to tap into the mobile geo phenomenon, it is much faster and smarter to put up co-branded sites powered by companies like Gowalla and Trulia than to try to build their own. http://gowalla.com/bestplaces      
|
| Ubisoft Expects Everyone To Have A 3D TV By 2013 (Yeah, Right) Posted: 12 Jul 2010 06:37 AM PDT
     
|
| Penguins Rejoice, Spotify Lands On Linux Posted: 12 Jul 2010 05:21 AM PDT  Spotify has been released for Linux. As of today, a Penguin-friendly version of the streaming music service is available as a preview, although we still don't seem any closer to the much-rumored U.S. launch. According to an official blog post, the Linux version was built by developers at the company "during hack days and late nights", and shares most of the same features as the Windows and Mac OS X desktop applications. That said, due to issues regarding decoding of local music on the Linux platform, Spotify hasn't been able to include support for local files in this version.
|
| Monday Morning Update: Google And China, iPhone Class Action Certified Posted: 12 Jul 2010 04:29 AM PDT
Good morning – depending on what timezone you’re in, of course. It’s Monday morning (already), but in case you hadn’t noticed, the past weekend wasn’t really much of a doozy on the technology business news front. Did you step away from your computer for the weekend, or did the clash between The Netherlands and Spain at the World Cup divert your attention away from the technology industry (too)? Spain won the cup, by the way. Here’s some other things we think you would like to know: - After Google had already told the world that its license to operate its search engine in China was renewed by the government, China’s Ministry of Industry and Information Technology confirmed the news over the weekend. - A federal judge has certified a class action accusing Apple and AT&T of monopolizing the aftermarket for iPhone voice and data services, but dismissed some of the plaintiffs' allegations that a software update ruined consumer-modified iPhones. The class action suit consolidates several suits filed by iPhone buyers starting in 2007, a few months after the first generation of the device hit the market. - We had a big scoop as well, with multiple sources confirming to us that Google has secretly invested somewhere between $100 million and $200 million in social gaming behemoth Zynga. The company plans to launch Google Games, for which the partnership with Zynga will prove to be an important cornerstone, later this year. - Facebook is set to launch a child safety ‘panic button’, reports the BBC. The button will allow young Facebook users to report suspicious online behaviour and access an Internet safety advice center from their homepage. A dedicated facility for reporting suspected grooming or inappropriate sexual behavior is being set up by Facebook in partnership with the Child Exploitation and Online Protection (CEOP) Centre. - The Android Market is growing up. Watch for Google’s mobile application store to hit the 100,000 apps milestone some time this month. - A U.S. judge slashed the penalty levied by a jury against Joel Tenenbaum, the student who was found guilty of illegally downloading and sharing songs published by Big Music in 2009. The judge ruled on Friday that it would violate the constitutional rights of Tenenbaum to require him to pay the full $675,000 in penalties, and cut the award down to $67,500. (Image courtesy of Flickr user Louis Argerich)      
|
| Can A Startup Think Global Without Boarding A Plane? Posted: 12 Jul 2010 02:31 AM PDT  This is a guest post by Richard Leyland, an entrepreneur and writer with a particular focus on the future of work. Richard is also the founder of WorkSnug, the location-based service for mobile workers. Last year I founded a tech company in the augmented reality space. We're doing pretty well. What began as me, an idea and a laptop is now a company with five people, plus a small army of freelancers and contractors. From roots in London we've now launched in sixteen cities across nine countries and two continents. We can reasonably claim to be global. But we don't fly. More than that, our founding principles make a public commitment that we won't fly in the course of our business.
|
| Performance-based Online Advertising Company Adsmarket Raises $17 Million Posted: 12 Jul 2010 02:14 AM PDT  Viola Private Equity, an Israeli buyout and growth capital technology fund, is injecting $17 million into Adsmarket, a global performance-based advertising network based in Tel Aviv. An affiliate of Viola Group, an investment consortium with nearly $2 billion under management, the PE fund will hold 21% of Adsmarket's shares, valuing the company at $80 million pre-money.
|
| The MP3Tunes Alternative To Paid Streaming Music: “Buy Anywhere, Listen Everywhere” Posted: 12 Jul 2010 12:26 AM PDT
The core of the service is a music locker. It finds music on your hard drive and then backs it up online over a period of days. You can then log in and stream that music from a browser. But the service is a lot more interesting than that. It will also sync your music across devices, making sure, for example, that iTunes has the same song library on each of your computers. It will also grab those iTunes playlists and make them available elsewhere as well. They’ve recently inked a deal with Roku and are in beta. MP3Tunes users can stream music that they previously only had on their hard drive through their television on the Roku device. Logitech has also built MP3Tunes into a variety of devices, including this Wifi Internet radio. More devices are coming shortly, says MP3Tunes. But the best part of MP3Tunes are the mobile apps. The Android application in particular is extremely useful. If you buy a song on the Android via the built in Amazon store, for example, you can easily upload that song quickly to MP3Tunes, and then have it available on, say your iPhone or iPod touch (as well as your desktop and everywhere else). MP3Tunes is calling the syncing behavior behind these application “Buy Anywhere, Listen Everywhere” – see the video below:
A number of other third parties have built MP3Tunes into their software and devices as well via a robust open API. I’m a big fan of music services on my mobile devices since getting actual song files onto the device is usually cumbersome and requires at least a purchase or a tethering. I use MOG on my android device and am quite happy with it. But I also like the idea of just having access to my entire music collection – all 60 GB of it – on any device at any time. I’m a long time user of MP3Tunes, and I’ve recently upgraded from the free version to the 100 GB of storage. Soon we’ll all have a variety of music streaming services to choose from – from Apple and Google’s upcoming products to the MOGs and Spotifys of the world. But all will likely have a hefty monthly subscription fee of $10/month or so for any kind of mobile access. I already have my core music collection on my hard drive, bought and paid for (for the most part). I really don’t see a need to pay $120/year to keep paying for that music. MP3Tunes gives me a viable reason to keep just buying music outright and downloading it. All this assume, of course, that MP3Tunes wins the longstanding EMI Group lawsuit against them. In the meantime, though, I like the service. MP3Tunes is free for 2 GB of storage. They are moving to 10 GB free in the near term, and 50 GB is $40/year. 25% of active users upgrade to a paid version, says the company.      
|
| Is Google App Inventor A Gateway Drug Or A Doomsday Device For Android? Posted: 11 Jul 2010 10:51 PM PDT
The service, unveiled tonight in the New York Times, is basically a what-you-see-is-what-you-get (WYSIWYG) tool for app development on the Android platform. Instead of having to learn code (in Android’s case, Java), App Inventor is a piece of software that allows you to drag and drop certain elements common to many apps to build a mobile app from scratch. Says Google:
That sounds great — on paper. As NYT notes, it has been tested with kids as young as sixth graders who were able to easily make their own apps. It also makes it easy for “regular” people to make apps. But as many web developers will tell you, the rise of WYSIWYG editors in their field led to an explosion of shitty websites. Tools like Dreamweaver and eventually online WYSIWYG HTML editors from the likes of Geocities, made it so easy for anyone to create webpages that the web quickly filled up with garbage. Thankfully (and appropriately), Google popped up to restore a sense of order to the madness with Pagerank and its search engine. This allowed people to wade through the junk and still be able to find the quality sites. So is that what App Inventor is going to do for Android? Create a flood of crappy apps? Maybe. But there’s a flip-side to this as well.
Because this new tool makes it easy for anyone to make their own apps, it makes the idea of trying to create your own app a much less daunting one. And that’s the powerful thing here. If this tool can get some kid to start messing around with app creation, maybe they’ll get more interested and start learning actual Java. And then maybe one day they’ll create the next killer app. Yes, this tool could be a gateway drug, of sorts. A lot of software developers haven’t liked the idea of this movement towards native mobile apps because some feel they’re pushing people towards devices that aren’t as open to tinkering as PCs are. That’s especially true with Apple’s devices. But Android is a pretty open system, and it seems that a tool like this could inspire people to want to learn how to make great apps. While WYSIWYG HTML editors led to an abundance of junk web pages, those tools also opened the door for a lot of people to learn HTML who may not have done so otherwise. With App Inventor, just as with those tools, it would seem that no one is going to be able to make a truly remarkable app without digging into the code eventually. And that may be Google’s ultimate goal with this. But still, they have to hope it doesn’t backfire and simply flood the Android Market with more junk apps than already exist. Google already has a problem with surfacing good apps in their market—interesting, given that they are the ones that surface good webpages as mentioned earlier—the problem could get worse if this tool is a success. Still, I’m going to be cautiously optimistic that this tool is a good thing. Potentially a very good thing. And it’s something Apple should be taking very seriously.
     
|
| Deals Galore, Competitors Abound: A Primer On Groupon-Like Startups Posted: 11 Jul 2010 08:13 PM PDT
For those that haven’t tried them, companies like Groupon find local restaurants, spas, or other businesses that are willing to provide large discounts, provided that their name is spread to a number of new customers. Groupon advertises the business by offering the coupons online, and takes a cut of the money spent on them. However, there are plenty of variations on the model and the differences can be confusing, so we're going to give a primer on some of them below (note that there are plenty of similar companies abroad — these are some of the big names in the US, though some of the companies below are international too). Groupon is the market leader in the online "group buying" industry, and according to Crunchbase Groupon has raised a whopping $172.8M in funding to date. Available in 140 cities world wide, Groupon offers deals in more cities than any other group buying company. For every city, every day, Groupon presents a discount for a niche market item (such as a spa, restaurant, or a paintball outing), and if enough people sign up for the deal, they get the discount. The coupons are sent to the buyers by email. Conversely, if the quota is not reached, the deal is off, and no one is charged for what they promised to buy. Of course, if the deal doesn't work out, the company that Groupon was "advertising" through the discounts, and the people who signed up to buy them will be a little bummed. Because the success of each deal relies on getting enough people to sign up, Groupon has created some incentives for their users to spread the word about the discounts they offer. Groupon encourages its customers to share news about deals through email, Facebook, and Twitter, and promises that if one of their users sends a Groupon link to a friend, and the friend buys a Groupon (coupon) within 72 hours, the one who sent the link gets $10 worth of Groupon credits in their account. Also, if a user sends a referral to a friend, who then subscribes within 72 hours, the person who sent the referral will get $10 worth of Groupon credits in their account when their friend buys their first deal on Groupon. LivingSocial is Groupon's main competitor, and they serve in 26 cities across the U.S. and have received about $44M in funding. LivingSocial's model is somewhat different from Groupon's, as there is no minimum number of people needed to make the deal valid. But like Groupon, the discount can only be activated, and then used, after the deal's run-time has ended. LivingSocial offers each deal for exactly 24 hours on weekdays, from 5am-5pm. Additionally, LivingSocial uses a different incentive to encourage more people to sign up for their deals. If a LivingSocial user shares a deal through a link provided by LivingSocial, and then three people join the deal through the link, then the person who shared the link gets their deal for free.
Gilt City, which was recently created as a subunit of Gilt, is only available in New York City so far. Unlike many of its competitors, each of Gilt City's deals lasts for seven days, and are updated once a week, rather than once a day. Also, rather than trying to sell as many of their deals as possible, Gilt City's inventory for each of the discounts appears to be limited, and can become sold out, much like the rest of the sales on Gilt. Like LivingSocial, Gilt does not require a minimum number of people to sign up for the deals to make them valid.
BuyWithMe has essentially the same setup as Groupon, with a new deal on display each day, with each the time limit for each deal set for about a week. Though they bring up a new deal each day on their main page, they do run a number of deals in each city (the number of deals running varies from city to city). BuyWithMe operates in 5 cities in the U.S, and has so far received $21.5M in funding.
Tippr is another group-buying site, and offers deals in 25 major U.S. cities. Tippr is owned by Kashless, which has raised $5 M since starting up. Unlike Groupon, LivingSocial, and BuyWithMe, Tippr proudly shows off three deals each day on their main site, with at least one new deal each day. As an incentive to get more people to join the deal, the discounts that Tippr offers get larger for everyone who signs up, as more people sign up for the deal, though there is a limit to how much the discount increases. A somewhat unusual aspect of Tippr is its army of ten patents, which are kept quietly on display at the bottom of the website (though it isn’t clear that these will actually help them beat the competition).
Juice in the City is a niche group-buying site that caters to mothers. This aspect of JITC is what differentiates it from the other companies in this roundup, as each deal that is offered on the site is meant to appeal to women with young children. JITC so far only serves a single deal each day within the San Francisco Bay Area and the Seattle-Tacoma area, and has not yet received any outside funding. They promise incredible, money-saving deals like the rest, but JITC does not require a certain number of people to sign up for each deal. Each coupon is sent to the buyer via email after being purchased, though they can’t be used the day they were purchased.
We Give to Get is available only in Chicago, and offers a new coupon (which they call a GO-GO) each day. What makes WGTG special, is that when you create an account on WGTG, you are also signed up automatically for the charity website; www.actofgood.org. As a result, whenever you buy a GO-GO, 10% of the money that is spent on the coupon will be donated to a charity of your choice, as long as it is listed on www.actofgood.org. It seems like an unusual idea to connect a money-saving action to a money-giving one, but as they say, "opposites attract". Similarly to Juice in the City and LivingSocial, WGTG does not require a minimum number of people to sign up in order to make the deal valid, and the coupon is sent to the buyer by email after the purchase is made.      
|
| Apple Rolls Out Four More iPhone 4 Ads — Each About FaceTime Posted: 11 Jul 2010 06:37 PM PDT
The four spots are titled, “Smile,” “Meet Her,” “Haircut,” and “Big News.” Each revolve around situations where FaceTime can dramatically improve what would normally be more traditional phone calls. They’re not quite as dramatic as the overall package of the longer original commercial (nor are they as good). But two of them still go straight for the heart strings. While the other two are more everyday conversations made better by video.
It shouldn’t be too surprising that Apple is playing up FaceTime in each of its first five commercials — it is the easiest new feature to show off on the device. Apple’s new Retina display for the iPhone 4 is arguably more impressive, but it would be hard to show that off in a commercial without explaining it (and Apple seems to prefer to show rather than tell in these types of commercials). Still, I wouldn’t be surprised if in future iPhone 4 commercials, Apple figures out a way to show off the screen (something like, “wow, it’s like looking at a picture”), as well as show off the impressive build quality of the device, and perhaps the HD video taking capabilities. Find each of the new spots below.
[thanks aaalison]      
|
| Chicago’s Excelerate Labs Graduates Nine Startups Posted: 11 Jul 2010 03:45 PM PDT
     
|
| This Mobile Payments Company May Self Destruct In 15 Minutes Posted: 11 Jul 2010 01:05 PM PDT
The latest announcement was picked up by a few news outlets, including the WSJ’s Venture Capital Dispatch which touted cMoney as "a start-up with a funky name [that] has an ambitious plan for replacing consumers' debit and credit cards with a mobile-payment system.” Sounds like another promising company in the red-hot mobile payments sector—a market that Nokia, PayPal, and a host of startups like Zong are trying to crack. Except, I don't buy it. There is too much hype, and too little actual product coming from cmoney. That highly-touted $100 million funding, for instance, turns out not be a venture round at all, but rather an equity line of credit (a lot more on that later). And the company is being sued by a CEO it recruited. Read on for a tale of a bizarre reverse merger, promises of million-dollar fees, and a young, 28-year old founder who lists among her accomplishments and qualifications her childhood sports activities, including “dance, gymnastics, soccer, softball and tennis.” What is cMoney? The company, which launched in March 2009, is developing a mobile application that will let users send or receive money via temporary connections. According to reports, the application will be linked to a users' credit cards and accounts. When s/he wants to make a purchase, the user logs-in to the app, submits information on the transaction, punches in a password and retrieves a code. The user will be able to give that code to a cashier for payment and after 15 minutes the code will expire. Like many startups, the company's product is not ready for market, it's in the "demonstration" phase. However, cMoney has struggled to meet its own deadlines. According to an April press release the launch was scheduled for this summer, then a May SEC filing predicted a fall release, and now, in its latest press release, the company is predicting a 2011 launch. Beyond the delays, the structure of the startup itself, is odd: cMoney acquired a company called Bonfire in May 2010 in a reverse merger transaction. According to an S-1 filing, Bonfire had no active operations and was previously a business based on "producing, marketing and selling audio recordings of folk tales, fairy tales and other children's stories under the brand name 'Bonfire Tales.'" Bonfire also disclosed in late March, just before the merger, that it had "no cash and a working capital deficit of $28,845." In fact, there was only one employee, the director, Tim DeHerrera, who was scheduled to resign after the deal. Unless cMoney wanted to tap Bonfire's rich trove of children's fairytales, why would a mobile payments company purchase a seemingly defunct company with only debt, no synergies and virtually no employees? The only real interest here, seems to be Bonfire’s status as a publicly traded company, trading over the counter as a penny stock (under ticker symbol PINK:BNFR). Reverse mergers are typically done by companies who cannot go public in a more straightforward fashion. The Case Of The Missing CEO On May 6, 2010, cMoney named Lawrence Krasner to the position of CEO, Krasner is a fairly seasoned veteran of Wall Street, as a former Senior Vice President of Lehman Brothers, a Senior Manager of Ernst & Young, and a VP of JPMorgan. Sounds like a solid coup for a fledgling startup, except Krasner never spent a single day as cMoney's CEO, according to the company’s SEC filing. Instead, Krasner is building a legal case against the company, suing them for damages in excess of $700,000 and 1,950,000 in fully vested shares of the company's common stock, according to a filing. I reached out to Krasner on Friday, but he said he could not comment at the time. The company says the claims “are without merit.” The founder of the company, Jennifer Pharris, has assumed the role of CEO and Chairman of cMoney. With the exception of a thin LinkedIn profile and her official bio on cMoney’s website, there’s very little information available on Pharris online. However, that official bio is worth a read— if you can make it through the syntactical quagmire:
Highlights include the random capitalization of words like “College Girl,” “Mom” and “Corporate World,” and my favorite (for its casual, mid-sentence transition from the third to the first person):
In fact there are typos and run-on sentences all over the website, with words like “trough” and “prividing” popping up on the investor relations and FAQ pages. While it is a bit unfair to judge them in this manner, this is supposed to be a startup valued north of $115 million. It’s hard to comprehend how any investor would look at this website and agree to plunk down $100 million— or even a million dollars. Which brings us to that $100 million question. Why did AGS and Kodiak Capital Group invest in cMoney? At the time of this post, the firms had not responded to my requests for comment. With no ready-for-market product, six employees, a poorly managed website, a lawsuit from an almost-CEO, and apparently more than $2.5 million in accumulated losses on the books and just $47,831 cash on hand (according to an S-1 May 27th filing), cMoney doesn’t seem like a prime candidate for a $100 million cash infusion. Then again, cMoney may not see a lot of that cash after all. AGS’s funding committment is contingent on several conditions and the structure of the deal itself is bizarre. Under the agreement, cMoney has the right to compel AGS to purchase its common stock shares, to “put” shares to AGS. Depending on the price of the share at the time, AGS will get a discount— for example, cMoney is currently trading at 3 cents a share, AGS would be eligible for a 50% discount to 1.5 cents a share. However, the key part in this agreement, is that cMoney “can not put shares to AGS if such put would cause AGS to own in excess of 4.99% of our outstanding shares of common stock.” In other words, once AGS hits that 4.99% bar, cMoney can no longer compel them to purchase the common stock and with the company currently trading at a market cap of $1.36 million — AGS is only on the hook for maybe a couple hundred thousand dollars. Of course, AGS could elect to buy more shares, but I’m going to make a bold prediction here that the final investment will be laughable compared to the promise of $100 million. Here’s the pertinent excerpt from cMoney’s July 7th filing:
And why does a young startup, with such a small staff, need a huge cash infusion? It’s unclear how the money will be used to build the actual mobile application, but at the very least, we know they are spending a large chunk of change on salaries for the executive team. The chief operating officer, chief marketing officer and chief financial officer have a base salary of $250K per year, the chief technology officer is promised $215K. Meanwhile, cMoney directly pays Pharris $500 a week, but (and here is where it gets interesting) her other company Global 1— which is not mentioned in her profile—receives $41,543 per year for 5 years of management services. As explained in a recent filing, these “management services are expect to be provided by Ms. Harris.” More significantly, in April of this year, cMoney entered into a “technology license agreement with Global 1 Enterprises, Inc. Under the agreement, C$ cMoney will pay Global 1 $1,500,000 per year for an exclusive and non-transferable license to certain intellectual property included trademarks and patents. Global 1 is owned by Jennifer Pharris.” Thus, to spell it out slowly, Pharris is charging cMoney hefty fees for the rights to license the technology from her other company. It’s hard to estimate what her cut is from this deal, but I imagine it’s a substantial amount (there was no reference online of any other executives at Global 1). For a company that is still bleeding cash, it’s strange for Pharris to charge such a high premium to access technology. Who knows, cMoney could have a brillant project underneath the jumble, but at the very least, this strange constellation of facts and questions paints a dubious picture. I have asked several people in the mobile payments space, including those who cover the sector for investment firms, whether they have heard ever of cMoney or AGS— no one said yes. As always, buyer beware.      
|
| Wired City: Josh Harris’ Plan To Make Us All Live In Public (Video) Posted: 11 Jul 2010 11:17 AM PDT Josh Harris lived through a version of the future—a future where TV is replaced by constant, live video chat/surveillance over the Internet—and it almost made him go insane. His experiments from a decade ago with filming people day and night in a New York City bunker, and then himself and his girlfriend in his own wired loft, were documented in the movie We Live In Public. Now, after many fits and starts, he wants to take another stab at making that future a reality through a new Internet TV project he is pitching called Wired City, which he explains to me in the video interview above. You can also go through the exclusive pitch documents which I’ve embedded at the bottom of this post. Harris made his first millions by founding market research firm Jupiter Communications. He then ventured into Internet TV way before broadband with Psuedo, one of of the more spectacular flameouts of the 1990s dotcom era. At one point, Harris had a net worth of $80 million. That all disappeared, much of it during the time he was broadcasting his life 24 hours a day over the Web in 2001. He later created a live video chat community called operator11, which also quickly went out of business. Harris decided to unplug and went to to live in Ethiopia for a few years. But now he’s back, pitching his new project which is a continuation of his decade-long quest to turn reality into TV. He says he only needs $50 million to do it right this time. With everything from Chatroulette to the iPhone’s new video-chat FaceTime feature, the time seems ripe for video chat TV to finally find its audience. When I first met Harris, I asked him what he thought of Chatroulette, the random live video chat service started by Russian teenager Andrey Ternovskiy. He shrugged and said, “It is child’s play.” And Facebook, to him, is nothing more than “an advanced message board.” Wired City is Chatroulette on steroids. It starts with video chat rooms where the audience comes and watches each other. Since anyone can set up a home studio with a webcam, anyon can become a “ChatStar.” These chat rooms are organized in what Harris calls “Net bandstands,” which are divided into different categories such as music, gaming, fashion, news, lifestyle. The Chat rooms are organized in a hierarchy and linked together. A video DJ or director controls what is seen in each chat room, and when something interesting is happening in his chat room, he can signal up the chain to get his live video into more popular chat rooms. Some combination of eyeballs and money will determine which videos get promoted.
At the very top of the stack is a Hollywood production studio filled with the most popular ChatStars. Harris proposes to “build a sound stage and the sound stage is cast from people at home.” If you do something special that attracts a lot of attention or advertising or both, your live video gets promoted in realtime up the stack, and as you gain points you get a chance to go to the big stage which is promoted on the homepage. “As you go up higher in the stages, just like in a massive multiplayer online game, you get more powers,” says Harris. “Or to put it more industrially, you get better administrative controls.” In this way, thinks he can create a mass audience attractive to advertisers. Everything on that set can be sponsored, from Gillette shaving mirrors to the Swanson’s Hungry Man dining table. He wants to sell micro-day parts of people’s lives, and over the long term he thinks that these mundane videos will have value to people who want to go back and reconstruct parts of their lives. Harris believes that everything he has done so far is leading up to Wired City. The technology behind it is an advanced version of Operator11, combined with creating their own home studios like he did with his loft. It is a real-life massive multiplayer game where the goal is to get onto the physical set and become Internet famous. What happens on the physical Hollywood set is “scarce and a highly coveted place to see and be seen,” says Harris, “sort of like the bunker in We Live in Public. Rather than approach VCs, Harris is trying to go straight to ad agencies this time, and maybe start with one sponsored ‘Net bandstand” to prove out his concept. He is also talking to reality TV studios in Hollywood. But his past and his history of startups that run through cash isn’t making it easy. He knows what he is up against: “The tech guys don’t seem to appreciate the Hollywood style production elements and the television people can’t see beyond the next reality show. And then of course there is the “Josh Harris factor” which I can’t (or don’t want to) shake.” Whether you think Wired City is an abhorrent example of Internet over-sharing taken to the extreme or you too cannot wait to begin lifecasting 24/7, it is instructive to look at how Harris thinks it can work. He has been obsessed with this idea longer than most people. Below are some slides taken from his pitch document and the entire document as well.
     
|
| Elon Musk: “Why Owen Thomas Is Silicon Valley’s Jayson Blair” Posted: 11 Jul 2010 10:16 AM PDT
Valleywag’s Owen Thomas, now writing for VentureBeat, has for some reason become fascinated with Musk’s personal life and continues to write about the man’s marital woes. He’s called Musk a liar on multiple occasions and seems delighted to get into the sordid details of Musk’s divorce. Musk wrote his side of things on the Huffington Post. Thomas hit him again. Musk is now responding yet again, below. What bothers me about this exchange is that Silicon Valley press, VentureBeat in particular, is so focused on an entrepreneur’s personal life. A divorce isn’t anything that our readers want to know about. This isn’t Hollywood and these individuals aren’t out there trying to get lots of press about their personal lives. If they were, they’d hire agents and publicists and make the best of it. Instead they are focused on imagining and building the future. There’s no place in our community for these kinds of attacks. VentureBeat should apologize and move on, and let Tesla continue to disrupt the car industry. Below is Musk’s response: Why Owen Thomas is Silicon Valley's Jayson BlairThe latest article by Owen Thomas, "Tesla CEO can't handle the truth", continues his damaging and fraudulent crusade against Tesla and me personally. Tesla has received a great deal of press, both positive and negative, but it is amazing how much of the truly negative press can be traced directly back to one man. Despite numerous successes at both Tesla and SpaceX, Thomas has never once written a positive article about either company. Every one of the dozens of stories he has written – without a single exception – has been a nasty hit piece. Even if all those stories were factually correct, and they certainly were not, he has still fundamentally misled the public about my companies by failing to provide even a token number of positive articles. Lying by omission is still lying. Responding below under similar headings Thomas uses in his article, I address the inaccuracies in his latest article, where he again lies with great conviction. It is impossible to stop Owen from continuing to write such erroneous garbage, but, as I do not have the time or inclination to refute all bad reporting on his part, I would like it known that nothing he writes is remotely objective. Any future articles written by Owen Thomas should be viewed with this in mind. Tesla IPO FilingsThomas says "Tesla updated its IPO filings to acknowledge substantially all of the concerns we [ie Owen Thomas] raised as potential risk factors investors should consider". We updated our IPO filings simply to state that what Thomas had written had no basis in fact. Since Tesla was in the IPO quiet period, we could not respond directly with a press release. Instead, we had to update the IPO documents to assure investors that what Thomas had stated about Tesla being reliant on me for funding or there being a DOE loan default risk related to my divorce were both false. Even without the IPO proceeds, Tesla has enough funding from its many venture investors, Daimler and the DOE to complete the Model S with no financial help from me. The reason for the IPO was to provide cash for additional new developments and a small percentage of liquidity for long time shareholders, including me (I sold 5% of my holdings). If this had been a real issue, it would have been placed in the IPO prospectus by the bankers and lawyers long before Owen Thomas raised it. This is one of many situations where he created a real problem for Tesla out of thin air by writing a misleading article. My Personal SpendingIn his section entitled "Musk's personal spending", Thomas does some creative math to claim that one of my "whoppers" is that I suggest I'm spending $30k per month, excluding legal fees. This is completely made up. I never state that anywhere in my piece, nor can it be computed from a collection of my other statements. Thomas intentionally conflates a statement I make about the average of what I've been forced to spend on divorce lawyers over the past two years and my household expenses last year, ignoring the fact that a huge portion of the legal expenses occurred this year in the run up to trial. Founding of Tesla MotorsHere Thomas relates an anecdote about a serious issue Tesla had with Martin Eberhard, one of the cofounders of the company. Eberhard filed a lawsuit against Tesla (and me) that was filled with inaccuracies. Tesla was going to file a counter suit, but before we filed, Eberhard and I settled our differences with a few hours of mediation. I'm glad that we made peace. The result obviously satisfied both Eberhard and me or it wouldn't have been settled. However, Thomas quotes Eberhard's lawyer as though this was a one sided victory. He could just as easily have quoted my lawyer who would have made the same statement. What Thomas forgets to mention is that Eberhard was forced to withdraw his lawsuit weeks before the mediation even began. If Eberhard's position had been strong, he would not have had to withdraw his claims unilaterally well before mediation started. The Safety of Customer DepositsThomas states that I both told customers that I would personally back their vehicle deposits and that I said their deposits were at risk. He is again intentionally conflating facts to make it sound as though I had contradicted myself. Here is how Owen Thomas once again misleads the reader: the statements are actually referring to different vehicles at very different stages of maturity, but he pulls each quote out of context and pretends they refer to the same thing. When I said that I would back customer deposits personally, which I did directly to customers on several occasions as well as in a Car & Driver article, that was clearly and explicitly regarding the Roadster. I knew that my resources, combined with Tesla's, would be enough to pay them back personally if need be. Moreover, Tesla had not been sufficiently clear with customers in the early days that the Roadster deposits were at risk. It would not be right for customers to have those funds at risk without their explicit consent. On the other hand, the statement I made to Claire Cain Miller of the New York Times at the Model S launch specifically and clearly referred to the Model S reservations. I knew that my and Tesla's resources could not also cover the Model S deposits in a worst case situation. However, unlike with Roadster, we were very explicit that Model S reservation dollars were at risk and that the funds would be put to use doing advance development of the vehicle. In this section, Thomas also says that I announced that a Tesla financing round had closed in November 2008, when it actually closed in March 2009. Whether intentionally or not, he is getting the dates confused between when the financing round documents were signed (representing firm commitments), which was actually December 2008, and when the last of the cash was wired in, which was March 2009. This is common in complex financial rounds with a large number of participants. My History as an EntrepreneurIn this section, Thomas casts aspersions on both Zip2 and PayPal, my first two companies, talking about management changes that occurred at both and not acknowledging one positive thing about either company. The reality is that Zip2 (which I started at age 23) sold for over $300M to Compaq and PayPal sold to eBay for over $1.5B after going public. Anyone reading Thomas's twisted account of their history without knowing better would think that both were failures. It is worth noting that of the five companies that I've been a key part of creating (Zip2, PayPal, SpaceX, Tesla and SolarCity) over the past fifteen years, every round at every company has been an up round, even in the worst of all market conditions. In other words, no matter whether you were a series A, B, C, D, etc investor, you always made money. With a public company, there are of course significant short term fluctuations in share price, but those investors that believe in a long term hold strategy should be comforted by this track record. Thomas also falsely states that I'm alienated from the rest of the management team at PayPal and have a completely different version of history to them. In reality, Peter Thiel, who replaced me as CEO of PayPal, later became one of the biggest investors in SpaceX. Max Levchin (PayPal CTO), Peter Thiel, David Sacks (PayPal COO) and I produced a movie together soon after we worked together at PayPal. There are half a dozen other ventures involving me and several other members of the PayPal management team. Tesla's InvestorsThomas references another NY Times Miller article about an email I wrote to customers and claims I said Tesla would start getting DOE funds in four to five months. What I actually said was that the DOE had told me to expect funds disbursement in four to five months. This was absolutely true. In the end, it took the DOE six months longer than they themselves expected, since the ATVM loan program was brand new. In any event, Thomas bizarrely manages to create a fake negative story out of what was actually a huge victory for Tesla. We were selected as the first winners of the Advanced Technology Vehicle Manufacturing program, along with Ford and Nissan. One of the requirements of this program was that you had to demonstrate that you were a viable ongoing business and that you had a compelling technology and business model for the funds sought. This is completely different from the auto bailout program for GM and Chrysler, although many in the media confused the programs. In fact, the reason that GM and Chrysler were excluded from the ATVM program, is that they were going through bankruptcy and therefore obviously failed the requirement to have a viable ongoing business. Thomas falsely states that Tesla wasn't profitable last year, even though I said it would be. In fact, Tesla was profitable in 2009, albeit only for the month of July. That's the best we could do, given the ramp up in Model S expenses, but nonetheless it was an important symbolic victory. If all Tesla did was focus on being a small sports car company and sell powertrain technology, it would still be profitable today, as both businesses generate a good margin. However, my goal from the beginning has been to make electric cars that anyone can afford (Model S is step two in that process, not the end game), which requires a huge expansion in production. We are trying to go from about 500 Roadsters per year to 20,000 Model S vehicles. In other words, production is intended to be 4,000% of what it is today in only a few years time. There is just no way to remain profitable with that level of growth and capital expenditure. Regarding Car & Driver quoting me as saying that GE would be an investor, that was an error on my part that was corrected as soon as C&D published. The C&D interview occurred a few months earlier when GE had confirmed via email that they would be investing. Then GE had some sort of internal crisis and pulled out at the thirteenth hour (they had asked us to extend the closing deadline to allow them to participate), which was unfortunate for them. Their investment would have done incredibly well. Thomas pointedly ignores actual Tesla investors. In addition to the excellent venture investors of Valor Equity, DFJ, Technology Partners and others, there is Daimler and Toyota. Daimler invested $50M in Tesla after working with us for a year on the electric Smart car and doing extremely detailed technical and financial due diligence. When we did another investment round late last year with ADWEA and Fjord Capital, they invested again. When we did the IPO, they didn't sell a single share, despite having a roughly threefold return on investment. The Toyota DealThomas states that although Toyota and Tesla announced that they would be developing a vehicle together, the SEC filings done right after the press conference say that we have no written agreement and there is no guarantee that we will get one done. Therefore, he concludes that I (and presumably Akio Toyoda), were misleading the public at the press conference! Thomas actually knows better, but, for those who aren't familiar with the requirements of an IPO prospectus (aka S-1), you always have to state the worst case scenario. This is done for liability protection, but is definitely not what is actually expected to occur. Anyone who thinks that Akio Toyoda, the president of Toyota, would give a major public speech in front of the governor of California about doing a joint electric vehicle project with Tesla and not follow through is a complete fool. As was announced last week in Japan by Toyota, we have now signed the agreement and will be delivering the first prototypes this month. The vehicle and details of the program will be unveiled at another event later this year. Despite Toyota's recent troubles, they are still the largest car company in the world and by far the leader in hybrid electric vehicles. For them to have invested in Tesla, (moreover at the IPO price) and want to partner with us to produce a vehicle is a great honor and a powerful endorsement. Purchasing the NUMMI plant for $42M, which has the ability to manufacture half a million vehicles per year or almost 1% of global automotive production, and making that our Tesla factory is another valuable element of the relationship. I should mention that NUMMI was owned half by Toyota and half by the General Motors spinoff (Motors Liquidation Corp), so we owe them a debt of appreciation too. The main reason I love this factory is that it accelerates our ability to produce an affordable mass market car. The Model S platform will at most consume 50k to 100k of the NUMMI capacity. The remainder of the plant will be sectioned off until we can bring our high volume affordable electric car to market, which has always been my dream for Tesla.      
|
I’ve always believed that computers, in a general sense, are not a panacea for developing nations. By slapping a laptop down on the desk of every student in Africa or Brazil you’re doing little more than forcing that kid to learn to type and then offering him or her the opportunity to look at porn. Without proper supervision and education, the Internet and, to some extent, computing itself is a timesink and an educational black hole.
Gaming is 
We’ve been following 
When you first look at 
Lately, group-buying sites and other companies that use discount-deals as the core of their business have become a red-hot trend, with Groupon spreading through cities around the world at a frantic pace and countless competitors and clones trying to catch some of the spotlight. Perhaps the reason for the sites' traction is that the group-buying model is easy to understand.
Yesterday, I broke down Apple’s minute-long FaceTime commercial for iPhone 4, noting how 
We recently wrote about the 
| You are subscribed to email updates from TechCrunch To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google Inc., 20 West Kinzie, Chicago IL USA 60610 | |
No comments:
Post a Comment