VentureBeat |
- DEMO: ShowUhow’s video guides promise to reduce product returns
- DEMO: Guardly alerts your ’safety network’ in emergencies
- DEMO: mSignia identifies mobile users for cloud services
- Rango filmmakers launch a promo deal inside Zynga’s FrontierVille game
- DEMO: Next Island opens time travel for its virtual world
- DEMO: Websense’s Defensio 2.0 protects company fan pages from malware on Facebook
- DEMO: Marginize adds a social layer to every webpage
- DEMO: Zugara engages online shoppers with dress-up visualization
- Groupon China launches after rumors of a bumpy start
- Get your Kindle on at AT&T stores starting March 6
- Gmail implodes for 150,000 users
- Six questions to ask before starting your global app empire
- Kontagent launches real-time social app monitoring system
- Bigpoint expands to US with Electronic Arts digital distribution deal
- Demystifying the VC term sheet: Dividends
| DEMO: ShowUhow’s video guides promise to reduce product returns Posted: 28 Feb 2011 09:00 AM PST In 2007, $13.8 billion worth of products sold in the United States were returned. According to Accenture, 68 percent of these products were returned because they were not meeting customer expectations or were simply too confusing to use. ShowUhow, a startup presenting at DEMO, has developed a solution for the latter problem and has guaranteed to retailers and manufacturers that its service will decrease product returns and increase sales conversions. ShowUhow is collaborating with retailers and manufacturers to create and host a series of product video guides, which will then be distributed to consumers via mobile devices and the web. These video guides will include information on set-up, configuration, features and benefits. After or prior to purchasing an item, a consumer can download the ShowUhow mobile application, scan the item’s barcode or enter the product information, and then be shown the product video. As an example of how effective ShowUhow's videos are, one cell phone manufacturer using the service saw a 64% increase in monthly product sales during the first three months compared to a 7% overall product average. Simultaneously, the manufacturer experienced a 12% decrease in support calls concerning products supported with ShowUhow guides. ShowUhow generates revenue by charging retailers and manufacturers for the product video guides, hosting services, and use of the guides. Although there are no companies that compete directly with ShowUhow, the company may face competition from larger retailers who are interested in releasing similar guides of their own. ShowUhow currently has 500 guides total with 9 of the top 11 retailers, including BestBuy, Costco, Walmart and ToysRUs. The guides have been viewed over a million times, the company said. Founded in 2008, ShowUhow is headquartered in San Diego and has 16 employees. It raised $3M in a first round investment from SYNCOM Venture Funds. ShowUhow is led by Chief Executive Kim Olson, who previously served as the VP and General Manager of DriveCam and SeminarSource. Companies: ShowUhow People: Kim Olson
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| DEMO: Guardly alerts your ’safety network’ in emergencies Posted: 28 Feb 2011 09:00 AM PST A middle-aged man walking down the stairs in his apartment has a heart-attack. Alone and gasping for air, he pulls out his mobile phone and with one button is able to notify friends and family in a predefined “safety network” to receive help. This is the vision of Guardly, a startup launching at DEMO that wants to decrease the amount of time it takes for responders to arrive at an emergency. Guardly's application allows smartphone users who find themselves in an emergency situation to alert, connect, and then collaborate with their personal safety network and authorities with one tap. Guardly also provides instant messaging, photo sharing and real-time location tracking capabilities. Users build up their personal safety networks by adding contacts from their phone address books. Guardly also recommends people to add.
Other companies in the mobile safety space include Life360, a service used to track young children, which is backed by the Founders Fund, and Rave Mobile, a mobile safety company founded in 2004 that, like Guardly, lets users alert the authorities with one touch. RaveMobile, whose investors include Bain Capital Ventures, Sigma Partners, and RRE Ventures, has focused specifically on the university market to date. Guardly is launching its beta test at DEMO and its next milestone is a formal product launch on Apple iOS devices followed by releases on BlackBerry and Android. Guardly has a freemium business model, providing a location-based alert system for free and charging a monthly subscription for its premium real-time collaboration service. Headquartered in Toronto, Guardly was founded in 2010 and has 4 employees. The company was started by Josh Sookman, who prior to Guardly worked at the BlackBerry Partners Fund and RBC Venture Partners. Companies: Guardly People: Josh Sookman
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| DEMO: mSignia identifies mobile users for cloud services Posted: 28 Feb 2011 09:00 AM PST
At the DEMO Spring 2011 conference, mSignia is announcing its Dynamic Device Identity for Android devices. The service identifies you as a user and your device so that you don’t have to enter those pesky passwords. It gives users an extra level of security for their mobile devices, which is increasingly important as phones become the center of our lives and malware attackers begin to center their efforts on phones because of that. mSignia tracks your device and the services you log into on it. If you replace your phone, mSignia can migrate all of the services from your old phone to your new phone, once you register the new device with mSignia. The mSignia service would also terminate the online banking service credential and other credentials on the old device so it can’t be used to access your banking data. And mSignia can alert any other mSignia-protected services that a new devices is now in use. The mSignia platform can uniquely identify a device you are using by pinpointing all of the hardware, firmware and software elements found on the phone. It anticipates changes to the device caused by updates and usage. mSignia can sign you into services automatically, unless the service requires you to enter a PIN number. If it needs to authenticate you, it can ask you to re-enter a PIN number. That’s a pretty good service in an age when it’s easy to lose a phone and it’s also very likely that you have some really important stuff on your phone. The company says its security is hard to beat because of the way it authenticates users and it says it doesn’t get false negatives, where it improperly denies you permission to do something.
Just about any high-security service provide — banks, healthcare companies, or corporations — will care about the technology, since it will encourage users to use mobile apps that they otherwise may have been afraid to use. The company was founded last year and it has five employees. mSignia has no direct competitors at the moment, but it expects PC-focused security firms — iOvation, Threatmetrix, Equifax and RSA — to enter the mobile device market. mSignia considers those companies to be potential partners. mSignia is privately funded, but it hopes raise money. The company was founded by Paul Miller, chief executive, and George Tuvell, chief technology officer. They’re both veterans of software and security startups with experience in mobile markets. Companies: mSignia People: Paul Miller
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| Rango filmmakers launch a promo deal inside Zynga’s FrontierVille game Posted: 28 Feb 2011 09:00 AM PST
Zynga, the biggest social game company on Facebook, has created an in-game quest based on the Rango film to promote the film’s release in theaters on March 4. The deal is the first in which Zynga has integrated a major ad campaign within the FrontierVille game, which has more than 19.6 million monthly active players. This kind of deal could create a lot of ad impressions for the new film and it skirts the usual problems associated with marrying games and movies. It could therefore lead to a happier marriage between Hollywood and social gaming. The FrontierVille players will be challenged with three Rango-related tasks. That includes finding Rango, the chameleon character voiced by actor Johnny Depp, as he blends into the frontier. The tasks also include encouraging friends to send each other water buckets, and view the film’s trailer in advance of the release. Players will receive a Rango statue (a virtual good) to add to their homestead on FrontierVille as a reward for completing the mission. “The Rango campaign offers a fun way to interact with the film’s characters while enhancing game-play within FrontierVille.”said Manny Anekal, global director of brand advertising at San Francisco-based Zynga. Once upon a time, movie makers commissioned lots of video games based on movies, both to boost the audience for movies and also to generate a lot of ancillary income. But as video game budgets grew and it started taking two years or more to make a decent game, that practice fell into disfavor. But with social game tie-ins, movie companies can reach huge audiences with targeted campaigns that can be created in a very short time. Filmmakers at Twentieth Century Fox also have a tie-in with Angry Birds smartphone game maker Rovio, which is doing a special version of its hit game for the upcoming animated film Rio. Zynga previously cut a deal with Sony Pictures Entertainment to promote The Green Hornet movie with the Mafia Wars social game. And it also launched a campaign with DreamWorks Animations to promote the animated film Megamind by creating a “Mega-Farm” within Zynga’s FarmVille game. In the 24-hour promotion period, more than 9 million people engaged with the Mega Farm. The Rango quest begins today and runs through March 6 on FrontierVille. Zynga says it is having great success in promo deals with its games and it disclosed some interesting results. In January, 2010, it launched an in-game campaign in Mafia Wars for the Public Enemies film. During that week, players claimed more than 55 million loot interactions related to the movie, completed 45 million-plus missions, and helped drive the Public Enemies DVD to No. 3 in sales. More than 19 million users were engaged with the Public Enemies content. Zynga has also partnered with 7-Eleven stores to promote Zynga products and games in 7,000 convenience stores. 7-Eleven offered 15 Zynga-branded products in its stores and 4 million codes from those products were redeemed in six weeks. About 75 percent of people who bought ice cream in the stores redeemed the Zynga codes. General Mills Cascadian Farm also cut a deal allowing the creation of a branded crop in Zynga’s FarmVille game. That allowed players to grow a virtual blueberry crop in the game. About 5 million users engaged. More than 500 million crops were planted, more than 1 million Facebook feeds were posted, and there was a measurable huge increase in brand awareness, brand lift, and purchase intent for Cascadian Farms.
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| DEMO: Next Island opens time travel for its virtual world Posted: 28 Feb 2011 09:00 AM PST
As we noted before, the enterprise is a test of whether virtual worlds have a place in the modern landscape of gaming, where most of the excitement revolves around social games such as CityVille, mobile games such as Angry Birds, or traditional console games and PC online titles such as World of Warcraft. But Post believes there are casual gamers out there who are hungry for a deeper experience than what they can get now. “We are targeting the market we call ‘power casuals,’” he said. “What if a world existed that had the beauty and game play of World of Warcraft and yet was easy to play and had the community of CityVille?” A number of virtual worlds that raised a lot of money have failed in recent times. The losers include There.com, Vivaty, and Metaplace. Next Island is a sci-fi adventure paradise built on top of infrastructure created by MindArk, which has created the massively multiplayer online virtual universe, Entropia Universe. The universe consists of a number of planets such as Planet Calypso. Next Island is a new planet in the universe. Unlike other worlds, the time travel theme gives Next Island a chance to have a wide diversity of imagery. The first major section that visitors can travel to is ancient Greece. Within that sub-world, players can go on a variety of missions. Other sections will come online over time. Next Island will be run as a free-to-play game, where users can create, purchase and trade virtual goods within the world. What’s distinct about Next Island is that users will be able to cash out, converting virtual money into real world money. That’s possible since Entropia runs its own virtual bank, which has been recognized as a real bank by Sweden (Entropia Universe is based in Sweden.) Over time, users will be able to travel from era to era and from planet to planet. Post founded Next Island in 2008. He was a serial entrepreneur who founded and sold both pager company Page America and Cellular Systems. So he funded Next Island himself in the hopes of reviving a childhood fantasy. Each day for a brief time when he was young, starting at the age of nine, he wrote the story about the parallel universe of Elysium, where it seems like paradise, but where danger lurks under the surface. He worked on the world for eight years, but he had to wait 30 years for the technology to catch up with what he wanted to do. The back story is that the rich people of the world buy a set of islands and then create an isolated paradise hidden from the rest of the world. One of the islands has a portal into time that can be used to visit places such as ancient Greece, which is now ready for players to see in demo form. Players will teleport from age to age. If players acquire weapons in a modern age, they won't be able to take them back to an earlier age. They'll have to earn new weapons and use them to hunt monsters. You'll also mine for valuable resources and use them to make things that can be sold for virtual currency. The virtual world has a real cash economy; every transaction is tracked and reported. Post said he waited a decade to put together this business. About three years ago, he got serious about doing a virtual world. He met the MindArk people and decided to leverage all of the planet-building resources they had already developed. He recruited John Jacobs, who goes by the avatar Neverdie in Calpyso, to help head his development studio. Jacobs became famous in 2005 because he mortgaged his house and spent $100,000 in real money on a virtual asteroid in the Entropia Universe. He opened a place called Club Neverdie and turned it into a real business. Post also recruited other luminaries in the game industry. Post has three employees and has hired 18 Neverdie developers to build his world. So far, Post has invested $1 million in the world. Outside investors include Loeb Partners, former Merrill Lynch media analyst Hal Vogel, Katlean de Monchy, Jon Jacobs and an unnamed banker from Citi. De Monchy will serve as the spokeswoman in TV ads and other marketing efforts. The first marketing partnership is with Y&R, where Next Island will create a virtual reality series called Avatarette. Companies: Next Island People: David Post
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| DEMO: Websense’s Defensio 2.0 protects company fan pages from malware on Facebook Posted: 28 Feb 2011 09:00 AM PST
Websense is presenting its Defensio 2.0 product at the DEMO Spring 2011 conference today. For its six minutes on stage, the company says there will be more than 500,000 successful posts of malicious links, spam, and unwanted content on Facebook. With Defensio, a company can protect its brand, reputation, prospects and customers. San Diego-based Websense is an established, publicly traded security vendor. Its Defensio 2.0 product is specifically designed to improve Facebook security. The company says it wrote the application from scratch with help from the Facebook development team. The application can reject inappropriate web links and filter out comments, detect harmful scripts and malicious code, and allow users to automatically manage comments with predefined filters. It can also deliver an alert when unwanted content is detected. The company can also test your web page with one click of the mouse and indicate if you want to block profanity. The application runs in the cloud. The application is aimed at companies with Facebook pages, but it can also work with user profiles. Websense was founded in 1997 and went public in 2001. It has 1,300 employees and competes with McAfee and Symantec. Websense’s application is unique in that it is written specifically for Facebook. The initial product was released a year ago and it has now more than 15,000 Facebook pages protected. The new version supports new stream types such as photos, videos, and news feeds. The “test my page” feature is also new.
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| DEMO: Marginize adds a social layer to every webpage Posted: 28 Feb 2011 09:00 AM PST
Founded on the belief that a voice should be heard where it matters most, Marginize lets users directly comment on pages independent of the site itself and to engage in discussions with others. The goal of the service, which is a widget displayed on the right hand side of a browser (see image below), is to allow users to discover what the world is saying about any page. The service can be added and viewed through an add-on for Chrome, Firefox or Safari. Although a number of companies have tried to create a way for people to write comments on websites independent of the site itself, including the company Third Voice in 1999, Margin differentiates itself by integrating comments from Twitter. Marginize has already been used over 400,000 times and the company believes the integration with Twitter has been pivotal to better achieving critical mass. According to founder Ziad Sultan (pictured), there are over 100 million tweets sent per day, and approximately 25% of these tweets include a URL. This past month the company launched a publishers widget that, when added to a site, allows users to interact with Marginize without having to install the browser add-on. The company beta tested the service with the business section of the Boston Globe, Xconomy, Brad Feld's blog, and Onstartups.com, and at the DEMO conference Marginize will officially launch the publisher's widget to the public. Marginize, which was founded in 2010, is an alumni of the Techstars program in Boston. The company was founded by Sultan, who studied computer science at MIT and worked as a venture capitalist before founding the startup. Marginize has 9 employees and raised $650K in 2010. Investors in the company include TechStars, Atlas Venture, Longworth Venture Partners, eonBusiness, SOSventures, Dharmesh Shah, Joe Caruso, Jean Hammond, Bill Warner, Will Herman, Michael Mark, and David Cohen. Companies: Marginize People: Ziad Sultan
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| DEMO: Zugara engages online shoppers with dress-up visualization Posted: 28 Feb 2011 09:00 AM PST
The Los Angeles-based company is demonstrating its one-click “see how it looks” Webcam Social Shopper experience at the DEMO Spring 2011 conference. If the visualization technology works, it could help convert more online browsers into online purchasers. And that could be worth billions of dollars in new revenues for e-commerce companies. Matt Szymczyk, chief executive of Zugara, says that the typical conversion rate (turning them from shoppers into buyers) for online customers is 2 percent to 3 percent. That’s because online shopping is optimized for browsing, investigating, and accomplishing a transaction. But it’s not optimized for an engaging experience, which is what you get in the malls. With Zugara, a female shopper could effectively take a dress off the rack and hold it up to herself. She clicks on the “See how it looks” button, allows access to her webcam, takes a few steps back and then sees what would essentially be a mirror in the store. The computer screen will show her an image of how that dress would look like on her. She can then better judge if the color and style are right for her. If it’s not for her, she can tell that right away and not deal with the hassle of a return. If she wants a second opinion from friends, she can snap a photo of the faux dress and share it on Facebook for immediate feedback. The social network thus becomes a tool to help shoppers validate their potential purchases. Meanwhile, the retailer and the dress maker get word of mouth marketing on Facebook. Zugara says that studies show that 76 percent of people who shop online say that advanced product viewing features are extremely or very important to a purchase decision.
Szymczyk has a background in creating interactive marketing strategies for Fortune 500 clients, while Hans Forsman, vice president of creative and user experience, has a focus in user experience design. People: Matt Szymczyk
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| Groupon China launches after rumors of a bumpy start Posted: 28 Feb 2011 08:51 AM PST
Groupon is betting on having a strong local organization which it can leverage when trying to penetrate the notoriously difficult—but tantalizingly lucrative—Chinese market. Not only is Groupon partnering with two major Chinese investors, Tencent Collaboration Fund and Yunfeng Capital, but it is rumored to have a thousand employees working on Gaopeng.com by March. There’s no word if Groupon’s army in China is in place, but in mid-February there was rumors of trouble. The report detailing Groupon’s effort said that the operation was chaotic, and, probably most importantly, not run by the Chinese. Tencent, China’s largest Internet company, is also rumored to be thinking about launching a group buying service of its own. And, Groupon’s aggressive expansion into China is seriously ticking off its Chinese clones, the local group buying sites such as Lashou, Manzuo and Ftuan. The companies are already working the market and are supposedly setting up an anti-Groupon union, banning Gaopeng.com employees from working with the Chinese sites ever again. Granted, all this is hearsay so far, and some do believe that Groupon can succeed where many others, like eBay, have failed. For one, group buying is already a familiar concept in China, so it should be easier for Groupon to make its foray into a market where it doesn’t have to start from scratch in explaining its benefits for consumers or local businesses. Secondly, Tencent and Yunfeng Capital (founded by China’s leading e-commerce site Alibaba’s chairman Jack Ma) are excellent partners for Groupon. Whatever the case, Groupon needs to play its hand very carefully if it wants to take on the Chinese market and come out on the winning side. Like the Hong Kong-based Samsung Securities analyst Paul Wuh said, "Discounts will always be popular but the question is, will Groupon be more popular than the other websites." Based in Beijing, China, Gaopeng.com is now accepting email registrations from Chinese consumers who will be notified on daily deals from local merchants, such as restaurants, gyms, home electronics retailers and so on. The service is initially covering Shanghai and Beijing before expanding to other major Chinese cities. [Photo credit: futureshape] Companies: Ftuan, Groupon, Lashou, Manzuo, Tencent, Yunfeng Capital People: Jack Ma
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| Get your Kindle on at AT&T stores starting March 6 Posted: 28 Feb 2011 07:41 AM PST
AT&T will only offer the $189 Kindle 3G (the same price as Amazon’s website), not the megapopular $139 WiFi-only version. AT&T is not promoting the device with special offers or add-on deals either. Basically, the only upswing for consumers is that they have another place (there are over 2,000 AT&T locations in the U.S.) for testing the device before buying it. For Amazon, the collaboration should work favorably and means there’s yet another outlet for what it claims to be its biggest selling product — good news after letting the investors down with a disappointing fourth quarter. For AT&T, the Kindle deal is a chance to offer another hip mobile device outside of cellphones now that its lost its carrier exclusivity on Apple’s much-coveted iPhones and iPads. The Kindle probably isn’t going to boost AT&T’s revenues in any extraordinary measure, but still it is a solid move, and signifies a trend in carriers wanting to offer a wider range of devices than just cellphones, like tablets, e-readers, netbooks, and digital photo frames.
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| Gmail implodes for 150,000 users Posted: 28 Feb 2011 07:32 AM PST
It could have been worse for Google. Initial estimates had placed around 500,000 users with Gmail account trouble, but Google later revised that number to 150,000, or less than .08 percent of Gmail users. The company is aware of the issues, but at the moment its Gmail status blog still says it’s investigating the problem. The news is a big blow to Google’s cloud computing empire. Google wants consumers to believe that their data will be safe within its servers, but that will be difficult for some to swallow since Google still hasn’t been able to restore these lost accounts. The situation may not be as bad as when Microsoft permanently lost SideKick users’ data, but it’s a reminder that consumers can’t completely trust the cloud yet. Gmail’s last major outage was in February of 2009. That outage affected more users but lasted only for a few hours. As LifeHacker points out, Gmail’s weekend trouble is a good reason as any to start backing up data from your cloud services. You can set up Gmail via a desktop email client to manually save data, or use services like BackupMyMail and Backupify to establish automatic backups. Companies: Google
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| Six questions to ask before starting your global app empire Posted: 28 Feb 2011 07:00 AM PST Ilja Laurs is the CEO of GetJar, an operator of independent mobile app stores. He submitted this column to VentureBeat.
By the end of this year, we'll see 5 billion mobile subscribers globally, of which 1.35 billion actively download apps and other mobile content, according to a recent study by Chetan Sharma Consulting. Only a small portion of those app users are in the U.S. So if you want to pass 100 million downloads — the new bar for a global app bestseller — you must go global. Luckily, with app stores doing most of the work for you, going global with your app today is easier than ever before. It can even be easier than establishing an international website. But there are six critical questions you need to address to set yourself up for global success. What’s my concept? It doesn't take an expert in overseas history and culture to identify whether the concept of your app is suitable for every country in the world. While innocent family games like Angry Birds are accepted and loved everywhere, many other app concepts are not. Gambling, adult or religious themes, and even medical apps are some ready examples of concepts that may not travel well. But there are many others, like sports apps, that may be uncontroversial but still won’t become big because of specific sports preferences in a region. Don't expect a baseball app to become big in Russia or China, where this sport is nonexistent. What’s my platform? Platform is the next obvious decision after you've decided your concept has a good chance of becoming big globally or at least in a specific international market. While Apple’s iOS and Google’s Android are the natural choice for the U.S., where they’re battling it out for smartphone market share, other platforms dominate elsewhere. In China and India, two of the world's biggest app markets, iOS is almost nonexistent, while Nokia’s Symbian is very big — Nokia has 70 percent of the Indian market. And it’s a moving target: RIM’s BlackBerry surprisingly beat iPhone in the UK last year. Your choices are obviously complicated by Nokia’s recently announced alliance with Microsoft, which will take time to roll out, during which time Nokia plans to sell more Symbian phones. Bottom line: Get accurate and recent market-share data before spending money to, say, translate your iPhone app into Chinese. What’s the language? Speaking of which: Translation is one of the biggest problems that you may face. One specific translation problem with apps is that you cannot simply extract text, submit it to an agency, and plug it back into an app. First, most of your text is going to be standalone words, like "open", "resume", "shoot", etc. Translating the words without the context gives terrible results. The only way to do it right is to show the translator every text in the real app and explain what it means. Yes, it might mean playing every level of a game with every possible scenario. Second, most of the text in any good app is actually graphical. A designer picked the position, font, special effects and blending with the rest of the graphics. If that "Play" word in another language is longer or shorter than the original English word, then it may mean that the designer has to redesign the entire screen and related effects. The good news is that a lot of international markets are actually very tolerant of English content. While countries like China, Germany, and France require localization, some other big markets, like India, Indonesia, Russia, and most smaller markets have adopted well to consuming English PC software and Internet websites, making it very easy to sell English apps. Releasing your app in those English-friendly international markets is a good first step in your world-domination strategy. Sure, you may feel like you’re engaging in cultural imperialism, but realistically, your potential customers in those countries would rather have your wares sooner in English than later in their native language. What’s my business model? Changing your business model for new markets may make little sense at first glance — why fix what’s not broken, right? But as you move overseas, you may have to revisit your assumptions. For example, games are generally better monetized using a paid model. But in India, you might discover that the only way to bill is using premium text messages, since few consumers have credit cards. And carriers take 70 percent of the transaction. Suddenly selling ads or cross-selling other games starts to look more attractive. Let’s take an example: Say you sell a game in the U.S. for $3. In the closed app stores like Apple’s App Store or Google’s Android Market, you earn $2.10 after paying 30 percent to the store’s operator. (With an open app store, you’ll pay even less.) Let’s say advertising, based on the time users spend with your game and the rate advertisers will pay, will bring in an average of $1 per user. Paid is the obvious choice. However, if suddenly you had to pay a 70 percent revenue share, like what carriers charge in India, your paid model would only earn you $0.90, making ads that earn $1 per user a better choice. This is the hard part: You’ll have to learn the payments landscape and run the numbers country by country. What’s my distribution? The app stores you’re already working with in the U.S. can help take your app global. They’re certainly less trouble. But you should look both at the app store’s performance in the specific market you're looking at and at alternative distribution channels in that market. For example, if you're looking at a country like China, none of the usual app stores will be of much help. In India and Russia, carriers still play a big role. Apple’s App Store runs predominantly on credit cards, so it’s not much help in countries where credit cards aren’t widely used or where the younger demographic you want doesn’t have access to them. Premium SMS or direct carrier billing are the way apps get sold in much of the world. And there are also distribution deals with handset manufacturers or carriers — they may not be as cool as modern app marketplaces, but they get your app in the hands of users in places where consumers are otherwise hard to reach. The bottom line: Going global requires rethinking a lot of the assumptions you made when building an app for your home country. But if you want an app that sets records, you’ve got to be willing to change. [Image via Youthedesigner.com] Companies: GetJar, Google, Microsoft, nokia
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| Kontagent launches real-time social app monitoring system Posted: 28 Feb 2011 06:00 AM PST
That’s why social-analytics firm Kontagent is stepping up today with its real-time social app monitoring system. Kontagent president Albert Lai says that for the first time, social app developers can get real-time insights into the behavior of users. Kontagent’s new tool can update its feedback on application usage every 10 seconds. This development will give the makers of the world’s most popular social apps more fine-grained control over their relationships with customers. San Francisco-based Kontagent can pretty much pick up everything that happens with an app. It regularly processes 10,000 social events per second and is moving to tens of thousands a second. To put this in context, the highest number of messages sent per second on Twitter is less than 7,000.
Kontagent says the real-time monitoring can significantly lower the risk associated with deploying new features or updates. That’s important because social app makers have to continuously monitor the behavior of users and tweak their app ever so slightly to make sure users stay engaged and spend money. “As an agile social gaming company, we need to release multiple times a week, and sometimes even multiple times a day, but we have game experiences and third-party integrations, that while critical, can be quite fragile," said Ali Nazer, co-founder of Lionside, a social game company that recently launched NBA Legends, the first NBA licensed game on Facebook. Nazer said the Kontagent real-time monitoring is just what his company needs. Kontagent said it has tripled its head count in 2010 but is still hiring at a faster pace now. The company recently announced that its analytics is now tracking 100 million users via the customers who subscribe to its analytics platform. Kontagent has raised more than $6 million from Altos Ventures, Maverick Capital, The Facebook Fund, Extreme Venture Partners, The Hit Forge, and many angels. Kontagent was founded in 2007. Companies: Kontagent People: Albert Lai, Benjamin Sun, James Hong, Jameson Hsu, Larry Braitman
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| Bigpoint expands to US with Electronic Arts digital distribution deal Posted: 28 Feb 2011 06:00 AM PST
The deal also comes on the heels of some big news at Bigpoint, which has become a powerhouse itself in the new digital games market. Two weeks ago, the company launched a free-to-play version of Battlestar Galactica (pictured at top), where users can play the online-only game for free and pay real money for virtual goods as they go. In two weeks, Battlestar Galactica got nearly 500,000 users, said Heiko Hubertz, chief executive of Bigpoint, in an interview. The Battlestar Galactica launch is part of a big push into the U.S. market. Hubertz has hired more than 90 people in the company’s San Francisco office and relocated from Germany to San Francisco himself last April. “That’s how seriously we are taking this expansion,” he said. For EA, the move is a way to get its online games in front of millions upon millions of game players who are accustomed to paying for virtual goods in online games. That business model represents a small part of EA’s business, but it’s growing fast. By the end of March 31, EA expects that its digital revenues will hit $750 million. One of the first online games from EA that will use Bigpoint is Lords of Ultima, a free-to-play fantasy massively multiplayer online role-playing game. More games will come later. EA has made a big push into such games in recent years as a way to build up its digital distribution revenue even as it continues to build major console and PC retail games. If such games become a bigger and bigger part of the market, EA can be positioned to take advantage of it through the Bigpoint deal. In the free-to-play world, broad distribution is important. If only a small percentage of players will pay for something in the game, then you have to recruit as many players as you possibly can to make the game a success on a financial level. But the EA deal is not exclusive in either direction. Hubertz said Bigpoint will announce distribution deals with other major publishers soon. A lot of publishers are drawn to browser-based games now because they don’t require big downloads, which is often a big obstacle for players who have no broadband or weak broadband connections.
The next major Bigpoint game coming within days is Ruined (pictured above right), a third-person 3D shooting game. For a browser-based game, the graphics in Ruined are astonishingly good. The web-based game uses the high-end 3D game engine from Unity Technologies. In adopting that engine, Bigpoint is going after people who normally might want to play hardcore console games. Hubertz believes that hardcore online games are an under-served market, while many of the other startups in the game business are now chasing the Facebook and mobile casual game markets. Hubertz said that Facebook games will continue to grow, but game publishers will have to pay a 30 percent tax for virtual currency transactions to Facebook. By running its own web site, Bigpoint doesn’t have to pay anyone. One of the best things about hardcore gamers is that they spend a lot of money on games. So far, in its first two weeks, Battlestar Galactica has been drawing paying players who are spending an average of $50 on 3,500 virtual items in the game, including spaceships and weapons. “We think we can get console players to move to the browser and the free-to-play model,” Hubertz said. Bigpoint's rivals include Germany's Gameforge as well as others such as Jagex, InnoGames, Artix Entertainment, Akama, Aeria, and K2 Network. Hubertz said his company has the No. 1 market share worldwide for browser-based games. He said the company has doubled its revenues in the U.S. in the past year. “We believe local content is very important for a market like the U.S.,” Hubertz said. Companies: Bigpoint, Electronic Arts, NBC Universal People: Heiko Hubertz
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| Demystifying the VC term sheet: Dividends Posted: 28 Feb 2011 06:00 AM PST (Editor's note: Scott Edward Walker is the founder and CEO of Walker Corporate Law Group, PLLC, a law firm specializing in the representation of entrepreneurs. He submitted this column to VentureBeat.) In response to my last two posts demystifying VC term sheets (specifically addressing exploding term sheets and no shop provisions and price-based anti-dilution provisions), I have received a number of questions regarding other terms and provisions in term sheets. Accordingly, I thought it would be helpful to address each of the questions over the next several weeks –creating a comprehensive series of posts relating to VC term sheets. Beyond the most recent topics, I have also previously addressed valuation, liquidation preferences and stock options. Today, we’ll look at dividends and how to protect your company from over-reaching by the investors. Dividends are generally not a huge issue in connection with the negotiation of VC term sheets; however, founders need to watch-out for mandatory cumulative dividends, as well as stock dividends that could be extremely dilutive to them. Let’s go over some of those terms. What is a dividend? A dividend is, in essence, a distribution of the company's profits to its shareholders, which is generally paid in cash or stock. Cash dividends are obviously rare in early-stage companies because there are usually no profits (or cash) to distribute - and if there were, they would generally be re-invested in the growth of the company. Stock dividends are problematic due to their dilutive effect. There are two types of dividends: non-cumulative and cumulative. With a non-cumulative dividend, if the Board of Directors does not declare a dividend during a particular fiscal year, the right to receive the dividend extinguishes for such year. With a cumulative dividend, the dividend is calculated for each fiscal year and the right to receive the dividend is carried forward until it is paid or until the right is terminated. In short, it accumulates (and sometimes investors require compounding). Cumulative dividends as a protective device - Cumulative dividends are relatively rare (10 percent or less of financings have them). However, investors sometimes push for some form of cumulative dividend as a protective device to provide a minimum annual rate of return on their investment (say, 7-10 percent) – and it is thus tied-into the liquidation preference. If the company capitulates on this issue, it must make clear in the term sheet that cumulative dividends will only be payable if there is a liquidation event (such as the sale of the company) and will be forfeited in the event of an IPO or upon the conversion of preferred stock into common stock (because the protection is not needed in such cases). This provision would look like something like this in the term sheet: "The Preferred Stock will carry an annual __% cumulative dividend [compounded annually], payable solely upon a liquidation [or redemption]…." Provision most favorable to the company - A dividend provision most favorable to the company would look something like this: "Dividends will be paid on the Preferred Stock on an as-converted basis only if, when and as paid on the Common Stock." This is favorable to the company because the investors' only right to a dividend is to participate with the common stockholders when and if declared by the Board. Typically, however, investors will be given a limited preference to be paid first if a dividend is declared. That provision would look something like this: "Annual [8%] non-cumulative dividends on the Preferred Stock, payable only if and when declared by the Board, and prior and in preference to any declaration or payment of any other dividends.” Startup owners: Got a legal question about your business? Submit it in the comments below or email Scott directly. It could end up in an upcoming "Ask the Attorney" column. Disclaimer: This "Ask the Attorney" post discusses general legal issues, but it does not constitute legal advice in any respect. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction. VentureBeat, the author and the author's firm expressly disclaim all liability in respect of any actions taken or not taken based on any contents of this post.
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In a big endorsement for browser-based digital game distribution, German online game firm Bigpoint is announcing today that it will distribute online games for gaming powerhouse 
Under the deal, Bigpoint will make EA’s online-only games such as 
Hubertz (pictured) founded the company in 2002. Among the company's biggest titles are Seafight and Dark Orbit, which launched in 2006 and 2007, respectively. Those games are available in dozens of languages in 150 countries worldwide. Altogether, the company has scores of games available and 700 employees. Investors include GMT and NBC Universal (Peacock Equity Fund), which paid $110 million for a big stake in Bigpoint in 2008. In an alliance with its part-owner, Bigpoint wants to work on more games with licenses from Hollywood entertainment companies.
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