PhillyForce/Philly SaaS Meetup on November 5 features IDC's Michael Fauscette

Tom Paine

PhillyForce, the Philadelphia area user group for the,, and community organized by Ami Assayag @amiassayag and Matthew Botos @BotosCloud, in combination with Philly SaaS (organized by Chris Allan @chrisallan), have a real headliner for their Monday, November 5 meetup (6 pm at LiquidHub in Wayne). The presenter will be industry analyst Michael Fauscette, Group Vice President, Software Business Solutions at IDC. His subject will be "Moving from CRM to Customer Experience; How social, mobile, cloud and big data are changing the way companies interact and engage customers".

Michael Fauscette

Prior to joining IDC, Mr. Fauscette held senior consulting and services roles with seven software vendors including Autodesk, Inc., PeopleSoft, Inc. and MRO, Inc. You can follow his blog here, or follow him on Twitter @mfauscette. Although he has a broad background in enterprise software, his emphasis lately has been on social applications in the enterprise cloud environment.

Food and drink is being sponsored by the hosts at LiquidHub, and there will be time for informal networking before and after the talk.

Another big event for fans to put on their calendar is Cloudforce Essentials Philadelphia 2013, to be held on January 15, 2013 at the The Hyatt at The Bellevue.

Update: Here is the first part of a video from Michael Fauscette's presentation at the PhillyForce/Philly SaaS meetup on November 5. Also the slide deck from the
presentation is available here (pdf).


Highlights last week on Philly Tech News (10/22/2012 to 10/28/2012)

I profiled Ben Franklin Technology Partners Northeastern Pennsylvania's expanded TechVentures incubator, which is scheduled to host the first Lehigh Valley Startup Weekend this coming weekend (November 2-4); the power is back on there today.

Comcast posted strong 3rd quarter results on Friday boosted in part by the Olympics, but management is hopeful that there are signs that a longer-term turnaround is beginning at NBCU.

The 2012 Philadephia 100 was named and honored at a ceremony on Wednesday evening;
Dynamic Defense Materials LLC was ranked #1, WebiMax #2.

In news from other sources, Philadelphia Mayor Michael Nutter announced a new seed fund, Startup PHL, which will seek to leverage $3 million coming from the Philadelphia Industrial Development Corp with a $3 million match from a fund manager to be selected; there will also be a $500,000 "idea fund".

Safeguard Scientifics announced CFO Stephen T. Zarrilli would succeed Peter Boni as CEO at the beginning of November. SAP raised it's full year revenue outlook after reporting third-quarter software license revenue that beat analyst estimates. There was another outage at Amazon Web Services' Northern Virginia data center, impacting some Philly firms, this one apparently caused by a memory leak and failure of a monitoring alarm system.

Quote of the week: NBCU CEO Steve Burke: "Unfortunately we don’t own any television station in Ohio".

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Aramark spins off remaining stake in Seamless to its shareholders

Tom Paine

Philly-based food service giant Aramark announced today that it had spun off its remaining stake in New York-based Seamless (originally SeamlessWeb), the online food ordering pioneer, to Aramark shareholders. Aramark acquired Seamless in 2006. Early investors included the Conshohocken-based VC firm now known as Artists & Instigators.

Last year Aramark sold what it described as a minority stake in Seamless to Spectrum Equity for $50 million and relinquished operating control.

Jason Finger, who founded Seamless in 1999, left the company in 2010. Earlier this year he joined IAC as CEO of its CityGrid Media unit (which by the way includes UrbanSpoon).

This interview with Finger from 2009 recounts the history of Seamless.


Daily Links 10/29/2012: Major Data Centers in Northeast Brace for Sandy

Major Data Centers in Northeast Brace for Sandy (Data Center Knowledge)

Hurricane Sandy vs. The Internet: What's In The Path Of Frankenstorm (ReadWriteCloud)

Sandy takes out Gawker, Huffpo other sites (Gigaom)

Quality Systems 2Q results miss Wall Street's view (AP via Business Week)
Quality Systems' primary business is Horsham-based NextGen Healthcare.

Amazon sues former Amazon Web Services sales chief over his new job at Google (GeekWire)

Is Salesforce the new Oracle? Does it matter? (Phil Wainewright/Enterprise Irregulars)

Philadelphia region loses longtime game developer
(Philadelphia Business Journal)
Entertainment Games Inc. makes logical transition from PC games to mining, moves HQ to Arizona.

ARAMARK to Spin-off Interest in Seamless (PR Newswire)

Philadelphia Startup Real Food Works Launches Subscription Program for Healthy Eating (PR Web)


Philly Tech People News 10/28/2012: Zarrilli to succeed Boni as Safeguard CEO next month

Steven T. Zarrilli

Steve Zarrilli: Carrying on the Safeguard Torch of Innovation and Entrepreneurship (Peter J. Boni/Safeguard Scientifics Blog)

CHIME honors John Glaser with Lifetime Achievement Award (Healthcare IT News)

McSlarrow to Head Comcast's Mountain Region
Will oversee cable operations in Utah and Arizona
(Broadcasting & Cable)

Michael Dell, others to receive Franklin Institute leadership award (Philadelphia Business Journal)

Wheelhouse Analytics Announces New Board (Business Wire)

American Water Appoints New Chief Information Officer And Hires New President Of American Water Resources Subsidiary (Press Release via Water Online)

John Copeland Joins Rosetta as Co-Leader of Marketing Strategy & Insights Practice (PR Newswire)

RPS Announces Stephen Kasay as Chief Information Officer (PR Newswire)

DiD adds three new hires (Philly Ad Club News)

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SAP eyes "long" period of high sales growth-report (Reuters)

ThingWorx Extends SAP to the World of 50 Billion Smart, Connected Machines (Experience SAP

Saturday links 10/27/2012: Cause of AWS outage; Dell Boomi's role in SAP cloud integration

Amazon Web Services Outage Caused By Memory Leak And Failure In Monitoring Alarm (TechCrunch)

SAP details policies, pricing for linking cloud apps (Computerworld)
Dell Boomi's role: Bundled with SuccessFactors, but positioning for other SAP cloud
integration tasks unclear.

SAP Innovation Halo Drives Strong Quarter
SAP's revenue is mostly from core ERP apps, but its database, mobile, and cloud initiatives are sparking double-digit growth.
(Doug Henschen/InformationWeek)

Philadelphia Mayor to startups: Take the money and don’t run

Ben Franklin Technology Partners Speak at Venturef0rth (Venturef0rth Blog)

Lessons for Data Driven Businesses (TechCrunch)
By RJMetrics co-founder Robert J. Moore.

Betches Love This College: University of Pennsylvania (Betches Love This)


BFTP-NEP's TechVentures helps spur Lehigh Valley tech growth

Tom Paine

Of projects that were aided by the Obama administration's stimulus program (the American Recovery and Reinvestment Act), Ben Franklin Technology Partners of Northeastern Pennsylvania's expanded TechVentures incubator, on the grounds of Lehigh University in Bethlehem, is one that most on both sides of political spectrum agree was worthwhile. The expansion, completed one year ago, added 47,000 square feet of space, bringing the total size of the facility to 109,000 square feet. The $18 million expansion was funded from several sources including $6 million in federal stimulus funds. Vice President Biden attended the 2009 grounbreaking ceremony. And Pennsylvania Governor Tom Corbett had nothing but praise for the incubator, its work, and economic contributions to Northeastern Pennsylvania in a visit two weeks ago. The original facility, once an R&D center for Bethlehem Steel, is not part of the University, though the two institutions work together in many ways.

The five story, LEED-registered building features 60,000 square feet of rentable office space, 11,000+ square feet of wet lab space, and conference facilities. It also houses offices for Ben Franklin Technology Ventures NEP, and space for Lehigh's Baker Institute for Entrepreneurship, which has become nationally ranked among university entrepreneurship programs and a leading driver of entrepreneurial activity for students at Lehigh. TechVentures has received several awards, both for the facility itself and its incubator program.

The Lehigh Valley's tech legacy and current profile is somewhat different than the Philly area. Of course, the steel business went away, leaving a huge gap. The Valley has had a history and talent base in areas like chips and optics, largely related to
the past presence of AT&T's Bell Labs and Western Electric in the area. While that legacy lives on to some degree, with companies such as TechVenture incubator graduates CICLON (acquired by Texas Instruments) and IQE, Lightwire (acquired by Cisco Systems early this year) and CyOptics, and Lehigh's Center for Photonics and Nanoelectronics, it is not likely to be a driving force and job creator that it once was. The Valley probably has a stronger manufacturing base than the Philly area does now, and some of the startups there are focused on incorporating new technologies into older industries. There is biotech and medtech activity (such as TechVenture grads OraSure Technologies and Saladax Biomedical), and promising IT firms. TechVentures grad Computer Aid, Inc. is one; others include Allentown-based cloud computing firm IndependenceIT and Bethlehem-based insurance software firm Adaptik. Bridgewater, NJ-based Synchronoss Technologies has a major engineering center in Bethlehem.

Wayne Barz, Manager, Entrepreneurial Programs at Ben Franklin TechVentures, told me via telephone that TechVentures currently has 26 tenants and two "anchor tenants": CICLON/Texas Instruments (TI chose to stay and expand after acquiring CICLON), and Saladax Biomedical. Barz also mention Micro Interventional Devices as a tenant that is approaching a breakout stage; it has developed a minimally invasive structural heart repair product. XiGo Nanotools, which makes a shoebox-sized device that quickly measures the surface area of nano-particles, is another promising tenant that has already built a solid revenue stream.

Barz, who received his undergrad degree and MBA from Lehigh,has been with BFTP-NEP for 12 years. Last week Barz was awarded Lehigh's inaugural MBA Entrepreneurship Award at its MBA Day. He maintains a blog, TechnomicMan, and tweets under the same moniker.

Of course, Lehigh University's P.C. Rossin College of Engineering & Applied Science is an important source of potential talent. It awards out about 400 B.S. degrees and 135 graduate degrees each year.

Another valuable component of the Lehigh Valley tech startup ecosystem is Pi: Partnership for Innovation, a 9,000 square foot space in the upper floors of a hardware store leased by the city of Bethlehem. The space has been filled in less than a year since its Fall 2011 opening. Tenants include graduates of TechVentures such as business video website Viddler and RFID startup ElementID.

TechVentures will be hosting the first Lehigh Valley Startup Weekend on the weekend of November 2-4. Organizers of the weekend include Anthony Durante, Tim Lytle and Mark Koberlein, energetic co-organizers of the always busy Lehigh Valley Tech Meetup group,which now numbers 261 members, and Barz. Philly Startup Leaders President and appRenaissance CEO Bob Moul will be among the judges.

Also coming up on the schedule at TechVentures is Ben Franklin Venture Idol 2012, a "Shark Tank"-like competition to be held on the evening of November 15.


Comcast posts strong NBCU gains; Cable Communications growth solid

Tom Paine

I found the tone of Comcast's 3rd quarter earnings conference call this morning subdued despite strong results, understandably so given the tragic news of the murder yesterday of 2 young children of a CNBC executive (allegedly) by their nanny. CEO Brian Roberts addressed the matter briefly at the end of the call, saying "we'll do everything we can to support the family in their awful time". Answers during Q&A where unusually vague, I thought, and little news came out of it beyond what was in the numbers themselves.

Results at NBCU were boosted by the Olympics, as well as improved results in filmed entertainment. NBCU revenue was up 31.2% for the quarter and operating cash flow was up 19.9%. Although much of the short-term boost from the Olympics will undoubtedly diminish, Comcast is hoping a longer-term turnaround may be beginning for the network. Roberts noted that NBC just had its 7th consecutive week of winning the 18-49 demographic. CFO Michael Angelakis said that "overall the London Olympics were breakeven when you take into account other Olympic related revenues that are booked over multiple quarters".

Cable Communications had its first $10 billion revenue quarter, or $9.976 billion to be precise, increasing by 6.9%. Growth was led by High Speed Internet (9.3%) and Business Services (34.9%). Cable Commuications' operating cash flow margins exceed 40%, and capital expenitures are flat in absolute terms and declining as a percentage of revenue. Net video subscriber losses for the quarter declined to 117,000, down from 165,000 a year ago.

Earnings per share increased 136.4% in the quarter over the prior year, but excluding gains from Comcast's share of spectrum sold to Verizon Wireless and the sale of its stake in A&E Networks, which both hit in the quarter, EPS increased 39.4%.
Pro Forma results for Comcast, which compare 2012 to 2011 as if NBCU and the other 50% of Universal Theme Parks acquired in mid 2011 were included in 2011 results for the full year and are the most realistic basis for comparing the first nine months, show revenue for the quarter up 15.4% and operating cash flow up 9.5%; the same comparison for the first nine months shows revenue up 9.4% and operating cash flow up 6.4%.

Roberts said Comcast had no plans to expand beyond its existing geographical footprint through an over the top service a la Netflix, Amazon Prime, or Verizon/Redbox. Angelakis said any impact from the NHL lockout are immaterial to Comcast overall. Comcast's X1 service is now in 4 markets, with 2 more to roll out in the next two weeks. While politcal advertising is having some impact, NBCU CEO Steve Burke noted that most political advertising occurs in local markets and most NBC-owned stations are not in battleground states, saying "unfortunately we don’t own any television station in Ohio".

No specific information was offered about uptake on new offerings like X1, Comcast;'s Skype on Xfinity offering, or Xfinity Home. Also, few specifics on the Comcast/Verizon Wireless joint marketing agreement, other than the number of markets it is in, or on what the technology joint venture iniative between the cable partners and Verizon Wireless is up to.

Comcast shares are up 3.5% so far today.


Daily Links 10/25/2012: Safeguard Scientifics CFO Zarrilli to succeed Boni as CEO on November 1

Safeguard Scientifics Announces Stephen T. Zarrilli to Succeed Peter J. Boni as CEO Effective November 1, 2012 (Business Wire)

Safeguard Scientifics Announces Third Quarter 2012 Financial Results
Partner Companies Continue to Achieve Major Milestones, Increasing Aggregate Revenue Guidance for 2012
(Business Wire)

QlikTech Announces Third Quarter 2012 Financial Results (Business Wire)
Revenue in quarter slightly below low range of guidance; upper end of full year guidance lowered.

J.C. Flowers Decides to Keep [Dresher PA-based] Retirement Services Biz Ascensus (PE Hub)

SAP aims to be the Apple of enterprise mobility
The company is seeing large customer demand for mobile apps
Of course, everyone wants to be the next Apple. Good luck!

NetSuite posts bigger loss, sales rise (MarketWatch)

Verizon/Redbox Combo Set for Q4 Breakout (Light Reading Cable)

Infragistics enters cross-platform tool market (Software Development Times)

Unisys offering Google and Microsoft options in GSA competition (Philadelphia Business Journal)


Daily Links 10/24/2012: SAP beats revenue estimates, lifts 2012 targets; Unisys slips to red

SAP Lifts 2012 Revenue Target as Software Beats Estimates (Bloomberg)

SAP co-CEO McDermott: pipeline strong, focus organic growth (Video/Reuters via YouTube)

SAP’s Q3 2012 results analysis: business as usual but not done yet (Dennis Howlett/Enterprise Irregulars via ZDNet)

Internal SAP document reveals potential plans for next-gen BI, 'HANA Explorer' (Computerworld)

BREAKING: Salesforce Laying Off Radian6 Employees and Executives (TechVibes)

Unisys tastes red ink in mouth after pension chop-slap (The Register)

First Round Capital’s Chris Fralic On The Billion Dollar Exit (AdExchanger)

Google Launches DoubleClick Bid Manager, Based On Invite Media (WebProNews)

InterDigital Builds on Strategy, Announces Enhanced Technology Sourcing, Establishes Technology Solutions Unit
New Structure Emphasizes Focus on Partnerships and Industry Collaboration, Broadens Technology Areas, Lowers R&D Cost Going Forward
(Business Wire)
Sounds as if InterDigital will be outsourcing more R&D, buying out some staff.

InterDigital Announces Third Quarter 2012 Financial Results
Expanded Revenue Strategy Delivers Record Quarter
Combination of Intel Patent Sale and Patent Licensing Drives Cash Balance to over $780 Million
(Business Wire)

Comcast Q3 Seen Lifted By Improved NBCU, Olympics (Investors Business Daily)

Intel Licenses Comcast's Set-Top Software Design Kit
Multichannel News)

Study suggests NBA team could move to Va. in 2013 (AP via San Francisco Chronicle)


Highlights last week on Philly Tech News (10/15/2012 to 10/21/2012)

Glenside-based Flash game and video site Newgrounds received a $17.5 million venture capital investment, according to the 3rd quarter MoneyTree report from PricewaterhouseCoopers and the National Venture Capital Association using data from Thomson Reuters.

I looked at some numbers related to the recently completed Accenture/Octagon Research Solutions acquisition, and made a rough estimate of how much Accenture might have paid for Octagon.

I reported on Google's earnings release fiasco, and also Horsham-based Motorola Home's results.

Philly-based middle market PE firm Eureka Growth Capital is raising a new fund targeted for $150 million.

NJTechWeekly's Esther Surden contributed a report on national security concerns about China's Huawei and whether they could effect growth of Huawei's new R&D center in Bridgewater, NJ.

In news from other sources, Softbank announced an agreement to buy a 70% stake in Sprint Nextel. SAP TechEd wrapped up in Las Vegas, and's CloudForce NYC was held on Friday. And Violin Memory, backed by SAP among others whose flash memory products are important to the growth of many in-memory platforms, is reported to have filed for an IPO to raise up to $2 bilion.

Quote of the week: Charlotte Field, Comcast senior vice president of infrastructure and operations: "We want to be the next Apple".

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Daily Links 10/23/2012: Tax incentives aimed at bringing Oracle jobs to PA ready for Corbett's signature

Tax incentive to lure software maker Oracle to Pennsylvania awaits Gov. Corbett's signature (Philadelphia Inquirer)

SAP, Oracle negotiations: It's complicated (ZDNet)

SAP’s Gilroy bullish on channel growth (

Ametek raises full-year profit forecast again
Also announces it will buy Micro-Poise Measurement Systems for $170 million.

Tely Labs Dials Up New Video Conferencing Solution for Business With Strategic Investments From Comcast Ventures and Rogers Venture Partners (Marketwire)

Comcast forms CoMPASS team to develop next generation user interfaces (FierceCable)

McSlarrow Getting New Operational Post At Comcast/NBCU: Sources (Multichannel News)

Netflix's third-quarter earnings tumble amid global expansion (LA Times)
Netflix shares down 16% in after hours.

Comcast, NBC and the NHL lockout (Philadelphia Inquirer: Broad Street Bull)

Zagster Raises $1,000,000 to Accelerate National Rollout of Bike Sharing Programs for Hotels, Employers and Real Estate Managers (Marketwire)
Now based in Cambridge, MA, Zagster was originally founded in Philadelphia as CityRyde.

InterDigital’s Standardized M2M Technologies Power Multi-Vendor Machine-to-Machine Demonstrations and Interoperability Testing at ETSI Forum (Business Wire)

Healthcare IT venture capital and M&A hold strong in Q3 2012 (Healthcare Finance News)


Daily Links 10/22/2012: More problems at Amazon Web Services' Virginia site

Amazon problems take down Reddit, other sites (Gigaom)

PhillyInc: Hearing's message to Council: Philadelphia needs more capital and technology talent ( Philly Inc)

A Second Screen You Can’t Not Watch: Bravo’s “Play Live” Adds Polls, Games to All Its Shows (Peter Kafka/All Things D)
Bravo is owned by Comcast/NBC.

AMC Networks, Dish Shares Up on Settlement Carriage Deal (Multichannel News)

The myth of the wireless spectrum crisis (Gigaom)

UD gets $3 million for entrepreneurship program (Wilmington News Journal: Delaware Inc)

MeetMe® Bridges Online and Offline Social Discovery With Launch of Photoboard (Marketwire)

Airclic Partners with Industry-Leading Integrated Navigation Solution Provider ALK Technologies
(PR Web)

2012 Philadelphia 100 named (Update: rankings released)

Tom Paine

The 2012 Philadelphia 100 winners are shown on the organization's website. Some of the up and coming newcomers to the list are Futura Mobility LLC, Think Brownstone and Zivtech. (Correction: Think Brownstone was on last year's as well.)

The Philadelphia 100 Awards Ceremony will be held on Wednesday evening, October 24, at
the Annenberg Center, 3680 Walnut Street. The program is run by the Wharton Small Business Development Center, The Entrepreneurs' Forum of Greater Philadelphia, and the Philadelphia Business Journal.

Update: The ranking of Philadelphia 100 companies was disclosed at the awards ceremony Wednesday night, and are now reflected in the site linked to above. Dynamic Defense Materials LLC was #1, WebiMax #2.


Philly Tech People News 10/21/2012

Softmart Appoints New Management Team (PR Newswire)

SevOne Names IT Management Technology Industry Sales Executives Bart Kelly and Larry Baird to Lead Federal and Service Provider Sales Teams (Marketwire)

Former Canoe exec Lins lands at Clear Channel Outdoor (Communications, Engineering & Design Magazine)

DailyCandy Taps Moore As EVP To Enhance Cross-Platform Engagement

Budill Enters as Baker Exits NBCU's Executive Suite: Sources (Multichannel News)

Federation to Recognize Local Communal Leaders (Jewish Exponent)

Wolters Kluwer Health Appoints Cathy Wolfe President & CEO of Medical Research (PR Newswire)

Q&A: Cory Donovan, Project Liberty Digital Incubator (Keystone Edge)

Brownstein Group Adds 13 New Employees, Sees 33% Yearly Growth (Philly Ad Club News)

DiD adds three new hires (Philly Ad Club News)

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Josh Kopelman talks to Bloomberg TV

Josh Kopelman discusses current valuations levels, The Dorm Room Fund, FundersClub and other subjects with Bloomberg TV.

Flash game site Newgrounds raises $17.5 million in venture capital

Tom Paine

Newgrounds, the famous Glenside-based flash game and movie site with a worldwide audience, has raised $17.5 million in venture capital, according to third quarter numbers released in the latest MoneyTree report from PricewaterhouseCoopers and the National Venture Capital Association using data from Thomson Reuters. ranks Newgrounds 2,086 among sites globally and 1,271 in the US. Time Magazine rated Newgrounds as one of its top 50 websites in 2010. It was founded on July 6, 1995 by Tom Fulp, who still runs the site and has been the principal owner. Fulp was raised in Perkasie and attended (and eventually graduated from) Drexel. Newgrounds relies heavily on user-generated content, although it does produce content (some of it very successful) inhouse.

Newground's finances have been a mystery to most people. Advertising is said to be the primary source, and Newgrounds has a program that enables content contributors to get a share of ad dollars generated by their submissions. Newgrounds also has a merchandise store. Whether Newgrounds has generated significant revenue from content it has produced inhouse is unclear, although presumably there is some value to its intellectual property. (Actually, much of its inhouse content is produced through a separate entity co-owned by Fulp named The Behemoth.)

Recently, some users had suggested that Newgrounds was losing ground to competitive sites, and there had been more discussion on the site about financing alternatives. In April of this year Fulp posted this on Newgrounds, raising the question to his community about whether he should take VC money. In late September, Fulp introduced a premium subscription model that offered users some enhancement for $25 per year, leading some bloggers to wonder whether Newgrounds was in trouble financially.

I'm not sure who the investor(s) are, since the VC firm listed in the report invests primarily in the healthcare space so that doesn't seem correct (there are often discrepancies in the initial release of data).


Daily Links 10/19/2012: SAP TechEd wrap; Cloudforce NYC

Tom Paine

Early SAP HANA customers separate reality from the hype (Computerworld)

SAP TechEd wrap (Dennis Howlett/Enterprise Irregulars via ZDNet)

Cloudforce NYC Brings New Analytics to Marketing Cloud (Denis Pombriant/Enterprise Irregulars)

The Cloud is Gospel at Cloudforce 2012 (PC Magazine)

Despite Legal Risks, FundersClub Raises Massive $6M Seed Round To Turn The Crowd Into Venture Capitalists (TechCrunch)
FundersClub's founders have Penn/Wharton backgrounds and First Round Capital is among its seed investors.

Man defrauded Philly-based Checkpoint Systems of $5.5M: police (

New York startups can compete to get a fiber connection
Something Comcast should try in Philly.

Verizon predicts it will add 150,000-plus FiOS TV subscribers in Q4 2012 (FierceCable)


Philly-based Eureka Growth Capital seeks to raise up to $200mm for new fund

Tom Paine

Dow Jones' LBO Wire reports that Philadelphia-based Eureka Growth Capital is seeking to raise a new fund, Eureka III LP, with a target of $150 million and a hard cap of $200 million.

Eureka Growth Capital is a middle market PE firm headed by managing partner and co-founder Christopher G. Hanssens, a Villanova grad and Wharton MBA who previously was with Accenture and Murray Devine & Co., a transaction and valuation advisory firm. The firm's portfolio is diverse both in terms of industries and geography, although a few of its current investments are based in the Philadelphia area. It has some information technology investments; the most significant Philly area one I can see is Synygy, the Chester-based salesforce comp SaaS vendor from which it exited in 2006.

Eureka raised its last fund of $130 million in 2007.


Google's earnings release fiasco

Tom Paine

Google's stock is still in a strange hiatus today, after RR Donnelley mistakenly sent
a premature filing to the SEC containing Google's disappointing quarterly earnings release. The original report, which never sent out over the wires, can be seen here. The official release is now out, with the once pending quote from Larry Page now included.

Trading was halted after the premature release with the shares down 9%; it is set to resume at 3:20.

In a locally related note, the Horsham-based Motorola Home unit reported a loss of $22 million on revenue of $797 million. This compares to year-ago results of a $54 million profit on revenue of $825 million.

There have been widespread reports that Google has placed Motorola Home on the market.


Daily Links 10/18/2012: Philly Fed report suggests modest improvement

Verizon Profitability Surges as Bills Rise on IPhone

Verizon's FiOS TV Subscriber Growth Slows in Third Quarter (Hollywood Reporter)

Clearwire Drops as Sprint Makes its Move (Wall Street Journal: Deal Journal)

Cable-Tec Expo: DOCSIS 3.1 to Blaze Trail Toward 10 Gig Speeds
CableLabs: Spec Won’t Require Plant Upgrades, Will Be Backward-Compatible With 3.0
(Multichannel News)

October 2012 Business Outlook Survey: Indicators Suggest Modest Improvement (Philly Fed)

Lehigh Valley hosting its first Startup Weekend in Bethlehem (Easton Express-Times)

SAP to give business tools a consumer-app makeover (Computerworld)

QlikTech and Teradata Partner To Deliver QlikView Direct Discovery for Big Data Analytics (Business Wire)

Perelman invests in new Philly newspaper: UPDATE ( Philly Deals)

Philly Newspaper Guild Files Grievance Over Inquirer Reassignments (Philadelphia Magazine: The Philly Post)

Placed launches Panels to help companies gather and analyze location data (PandoDaily)
No surprise: WaWa most popular location in Philly.

New frontiers for Wharton Entrepreneurship: VIP expands to Wharton SF (Wharton Entrepreneurship Blog)


Penn's Internet Law Symposium (October 19 & 20) worth the time

Tom Paine

Tickets are still available for a symposium, "The Evolving Internet", presented by the University of Pennsylvania Law Review and UPenn's Center for Technology, Innovation & Competition, to be held this Friday and Saturday (the 19th & 20th) at Golkin 100, Michael A. Fitts Auditorium, on Penn's Campus. The event features a star-studded presenter list and the cost is extremely reasonable, even for private sector attorneys. A couple of receptions and meals are thrown in to boot; its probably the best value I've seen in Philly in some time.

New York Times Technology Columnist David Pogue will deliver the keynote. Other participants include Craig Partridge, Chief Scientist for Networking Research at BBN Technologies (which played a key role in developing the Internet), and Tim Wu, Columbia University telecom policy authority and author of The Master Switch. There will be several panels on evolving Internet technology and law, including discussions with executives from Google/Motorola Mobility, Verizon Wireless, and NBC Universal.

The event will run from 2pm to 6pm on Friday and 8:15am to 6pm on Saturday. CLE credits can be earned with an additional fee.


Daily Links 10/17/2012: SAP-backed Violin Memory said to file for $2 billion IPO

SAP unveils HANA-powered cloud development platform (Infoworld)

SAP's Sikka on HANA: it's about a platform for developers (Dennis Howlett/Enterprise Irregulars via ZDNet)

Violin Memory Said to File IPO With $2 Billion Valuation
SAP is an investor, and Violin's flash memory products play an important role in boosting the performance of many appliances running SAP HANA.

A top global software company [SAP] builds mobile products for retailers (Internet Retailer)

Daily Report: I.B.M.’s Somewhat Unsettling Quarterly Performance (New York Times: Bits)
SAP's earnings report due out October 24.

Wolters Kluwer Health to Acquire Health Language, Inc., a Leader in the Medical Terminology Management Market
Company Eases Meaningful Use & Clinical Decision Support Adoption for Hospitals, EMRs and Payers
(PR Newswire)

Engineering classes create apps to serve Penn (Daily Pennsylvanian)

Cable-Tec Expo: Comcast's Field: 'We Want to Be the Next Apple' (Multichannel News)

Comcast thinks outside the box (

Time Warner Cable Selects Motorola EDGE to Manage the IP Connected Home (Motorola Press Release)

Galileo Server Monitoring Tool to Showcase AIX and Linux Enhancements at IBM Power Conference
On-demand cloud service offers faster, smarter, cost-effective infrastructure management for IT systems administrators.
(PR Web)


Highlights last week on Philly Tech News (10/8/2012 to 10/14/2012)

Enterprise cloud software vendor Workday saw its shares rise 74% in its first day of trading after repeatedly increasing its offering price, and its market value approach $8 billion. Workday is seen as a rising competitor to SAP and Oracle.

I discovered that InterDigital had relocated its corporate headquarters from King of Prussia to Wilmington, DE.

There has been a good deal of venture investment activity in the Philly area lately, and I provided a roundup of it.

Safeguard Scientifics held its Investor Day 2012 conference in New York last week.

An unredacted version of a lawsuit against several PE firms released last week alleges that several of them cooperated to hold down bidding in the 2005 $11.4 billion LBO of SunGard Data Systems.

DreamIt Ventures filed to raise a new fund of up to $50 million, suggesting that it will be doing a little more follow on investing in incubator companies.

NJTechWeekly's Esther Surden contributed a report on Princeton Tech Meetup's late August event.

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Breaking down some numbers in the Accenture/Octagon Research deal

Tom Paine

I reported on the closing of Accenture's acquisition of Wayne-based Octagon Research Solutions, which Accenture announced on September 26, and Accenture's post-acquisition plans for Octagon. Accenture did not disclose the purchase price, and since
the deal is likely immaterial relative to Accenture's overall size it probably won't have to disclose it in regulatory filings.

Lawrenceville, NJ-based Edison Ventures, a key investor in Octagon, subsequently issued a press release stating that it had received a 6X return from its investment in Octagon. I thought I'd try to put together all the numbers I could find related to investments in Octagon, although I can't promise this is a complete picture:

February 2003: $3.8 million from Edison and Milestone Venture Partners.

March 2005: $3.5 million Series B preferred equity; three investors, of whom Edison was presumably one.

August 2006: $10 million, of which $2 million was from Edison, bringing its total investment to date in Octagon to $8.4 million. The other investors in this round were Phoenix Life Insurance, Zurich Financial, and Ticonderoga Capital.

September 2008: $12 million, with $10 million coming from Ticonderoga and the other $2 million coming from Edison, bringing its total investment to $10.4 million.

That's the last record I can find of any financing. When Octagon anounced last year it would increase staffing by 100, I presumed it might need some type of bridge financing, but apparently it didn't.

In terms of revenue, Octagon reported revenue to Inc. Magazine for the 2010 Inc.5000 of $37.5 million in 2009. One article cited 2010 growth of 20%. And Octagon said its revenue through the third quarter of 2011 was up 20% for the year. And presumably the staffing ramp up beginning in the middle of last year was in anticipation of increasing revenue streams. So I think it safe to assume Octagon's current run rate is well in excess of $50 million. No word on profitability, but if Octagon has indeed gone since 2008 without significant additional equity financing (although you can't rule out the possibility of some debt financing) it is probably not doing too badly on that score.

If Edison's total investment in Octagon was just over $10 million as last reports indicate, then it probably will receive proceeds in the $60 million range. Although Ticonderoga's total investment of $10 million plus is slightly larger, its return should be lower because it got in later.

The closest comparable deal for which pricing information is publicly available is Oracle's acquisition of Phase Foward, a company with a somewhat similar range of services for clinical trials, in 2010. Oracle paid $685 million, or more than 3 times Phase Forward's trailing revenue, and the company was marginally profitable.

My guess is Accenture paid at least $150 million, perhaps somewhat more, for Octagon.


Daily Links 10/16/2012: SAPTeched 2012, SCTE Cable-Tec Expo kick off

The Enterprise: I’m Not Sexy And I Know It (TechCrunch)
Very good article on current limitations of the Cloud in the enterprise.

After Larry Ellison Keynote, I Can’t Wait For SAPTeched 2012, Las Vegas (Vijay Vijayasankar/Vijay's thoughts on all things big and small)

SAP puts its HANA in-memory database on Amazon Web Services (Computerworld)

SAP Pumps Up Mobile Analytics Power (Information Week)

Edison data center company attracts $90M investment from venture group (NJBiz)

Cable-Tec Expo: Motorola Transcoder Spits 3 Billion Pixels Per Second
Vendor Claims GT-3 Provides 10 Times Density of Server-Based Transcoders
(Multichannel News)

Boxee Looks to Reinvent Itself with Cloud-Based DVR Box (All Things D)

Comcast trademarks DEEPDRIVE, AIRBASE for network DVR product (FierceCable)

Sprint Said Not to Plan Buying Clearwire After Softbank Deal (Bloomberg)

Uber quietly shutting down taxis in New York after fight with regulators, cabbies say (The Verge)

Deacom Invests in Mid-Tier Process Manufacturing
(PR Newswire)

PHD Virtual Announces Record Revenue Growth With 40 Percent Increase Year Over Year (Business Wire)
Also adds to management team and board.


Could Huawei security concerns impact recently opened NJ R&D center?

Esther Surden
Publisher & Editor,

When Huawei, the China-based global information communications and telecom company, established its North American R&D offices in Bridgewater in July 2012, N.J. celebrated because the company pledged to bring some 55 additional jobs here. Later reports increased that figure to 90.

In January 2011, the New Jersey Economic Development Authority(EDA) gave the company’s U.S. subsidiary, FutureWei Technologies, a $1.3 million Business Incentive Program grant as part of the state’s plan to create new jobs. In July, Lt. Gov. Kim Guadagno was there to cut the ribbon at the company’s new facility. NJTechWeekly covered the event here.

Now Huawei is in trouble, the kind that could affect its U.S. operations. As reported by the New York Times and many others, the company was mentioned in a House Intelligence Committee report written after a yearlong investigation of it and another Chinese firm, ZTE. The report essentially concluded that U.S. companies should think twice about doing business with the Chinese firms.

"The risks associated with these companies providing equipment and services to U.S.-critical infrastructure undermine the core U.S. national security risks," Rep. Mike Rogers (R-Mich.), committee chairman, said in a press conference.

The report says U.S. government and sensitive infrastructure systems should avoid using Huawei equipment. Rep. C.A. Dutch Ruppersberger (D-Md.) warned of a heightened risk of cyber-espionage or cyber attack from the two firms, which he said have ties to the Chinese government.

As mentioned in the Wall Street Journal, the report drew a denial from the Chinese government and some strong words from a Chinese commerce ministry spokesman, who warned that relations between the two countries could be hurt by the publication. He added that the report is based on subjective conjecture and untrue foundations and made groundless accusations against China.

Esther Surden is Publisher and Editor of NJTechWeekly, and a contributor to Philly Tech News. This was an excerpt from an article that originally appeared in NJTechWeekly.


Report: Softbank to buy 70% stake in Sprint; announcement tomorrow

Softbank to Buy 70 Percent Stake in Sprint: Source (CNBC)
Announcement expected tomorrow morning, according to report.

Philly Tech People News 10/14/2012: Rosetta, Roska, Symphony Health Solutions

Rosetta's Tom Adamski (left) and Mark Taylor

Rosetta Promotes Tom Adamski to President & Mark Taylor to Chief Operating Officer (PR Newswire)

Rosetta Promotes Four to Managing Partner (PR Newswire)

Rosetta Promotes Eight to Partner (PR Newswire)

Roska Healthcare Advertising adds 10 to staff (
Most for team assigned to new client Astellas Pharma.

Medecision Taps Healthcare IT Veteran to Lead Value-based Healthcare Solutions for Care Delivery Systems
Jerry Baker assumes helm to advance patient care, reduce costs, improve health

(Medecision News)

Symphony Health Solutions Announces New Senior Executive Appointments (Globe Newswire)

Symphony Health Solutions Adds Three Senior Executives and New Board Member (Globe Newswire)

Fortune's TermSheet reports that Michael Beblo has joined the Pennsylvania State Employees Retirement System as a director of alternative investments. He previously was director of private equity at the $4.7 billion Alfred I. duPont Testamentary Trust.

NBC Ad-Sales Veteran Gambelli to Leave Network
Departure Comes Weeks After Yaccarino Named to Top Sales Job at NBCU
(Ad Age)

ShopNBC gets new COO Minneapolis Star Tribune)
Comcast owns a stake in ShopNBC (ValueVision).

Barclaycard US is shaking things up at the top
(Delaware Online: Delaware Inc)

CorpU Announces $4.5 Million Funding To Launch Talent Development Revolution
Industry Luminaries Join CorpU's Board to Bring Online Executive Education from World's Best Business Schools
(Business Wire)

Jonathan Lupo, Empathy Lab’s Chief Experience Officer, to Speak on TV Everywhere at Digital Hollywood Fall 2012 (PR Web)

Purchasing Power names Rosenberg CFO (Altanta Business Chronicle)
Rosenberg was previously CFO of GSI Commerce.

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Lawsuit against PE firms alleges several conspired to hold down price of 2005 SunGard buyout

Tom Paine

A lawsuit filed by some shareholders and pension funds alleges that several private equity firms conspired to hold down bidding in many large leveraged buyout offering (LBO) deals.

Among the deals mentioned in the suit is the 2005 takeover of Wayne-based SunGard Data Systems by a group of seven private-equity firms for $11.4 billion. A principal of one of the firms, TPG, wrote in an email to a TPG associate that aggressive biding in a deal for SunGard would make enemies "while perhaps benefiting no one but the (company's) shareholders," according to the lawsuit.

One of the PE firms named in the suit is Bain Capital, but all of the deals involved occurred well after Mitt Romney left the firm in 1999.

You can read the portion of lawsuit related to SunGard beginning here. My guess is, though, that history will show SunGard shareholders received close to full value for their shares.

A federal judge in Boston this week ruled that the entire lawsuit, which previously had been released with many redactions particularly pertaining to emails, be released without redactions.

Fortune's Dan Primack, frequently a critic of the PE industry, had reservations about this suit. "As I wrote back when the complaint was originally filed, it's tough to argue conspiracy against so many firms on such a large number of deals, particularly when the record is clear that many of the defendants competed against each other on some of those very transactions", Primack wrote in a Fortune TermSheet article.

You can read the entire document on Scribd here.


Workday closes first day up 74%, after raising offering price again

Tom Paine

Enterprise Cloud software vendor Workday closed its first day of trading at $48.69, up 74% from its offering price of $28, which was raised from its previous range of $24 to $26, after already being increased from $21 to $24 per share earlier this week. That gives the company a market value of $7.3 billion.

Not to obsess about the numbers, but Pleasanton, CA-based Workday's valuation is big. Workday's 2011 revenue was $134 million, with a net loss of about $80 million. Workday is now valued at an amazing 39 times the last 12 month's revenue, although revenue in its most recently ended quarter doubled to $62.7 million.

Workday's importance is that its a completely cloud-based alternative to traditional on-premise enterprise software vendors, in particular SAP and Oracle. Workday is different from, both in aspects of its technology and in terms of applications. While is trying to branch out from its traditional Customer Relationship Management (CRM) emphasis (and is in fact partnering with Workday in Human Capital Management), Workday's strength is in the HCM space although it has already moved into financials and potentially could expand into a broader range of ERP applications. Major customer wins include Kimberly-Clark, HP and Google.

Workday's founders, Dave Duffield and Aneel Bhusri, worked together to build PeopleSoft into a company that was acquired by Oracle in a bitter takeover fight for $10 billion. Workday is also trying to move into one of PeopleSoft's old markets,
Higher Ed, taking on Oracle and Ellucian (the result of the Datatel/SunGard Higher Ed merger). SAP acquired SuccessFactors, and Oracle acquired Taleo and others in response to the Workday threat.