Nathan Myhrvold, the controversial head of Bellevue's Intellectual Ventures and former chief technology officer at Microsoft, is back in the news again with a lengthy feature in The New Yorker and a Q&A with PC World.

I just finished the piece by The New Yorker's Malcolm Gladwell, who describes Myhrvold as a "bearded, fair-haired Viking" who is "gregarious, enthusiastic, and nerdy on an epic scale."

It is a fascinating read, which includes comments from Bill Gates and weaves in the history of Alexander Graham Bell's work on the telephone. I've included a few excerpts here, but the piece should be read in full.

In 1999, when Nathan Myhrvold left Microsoft and struck out on his own, he set himself an unusual goal. He wanted to see whether the kind of insight that leads to invention could be engineered. He formed a company called Intellectual Ventures. He raised hundreds of millions of dollars. He hired the smartest people he knew. It was not a venture-capital firm. Venture capitalists fund insights--that is, they let the magical process that generates new ideas take its course, and then they jump in. Myhrvold wanted to make insights--to come up with ideas, patent them, and then license them to interested companies.

Bill Gates' take:

Intellectual Ventures just had a patent issued on automatic, battery-powered glasses, with a tiny video camera that reads the image off the retina and adjusts the fluid-filled lenses accordingly, up to ten times a second. It just licensed off a cluster of its patents, for eighty million dollars. It has invented new kinds of techniques for making microchips and improving jet engines; it has proposed a way to custom-tailor the mesh "sleeve" that neurosurgeons can use to repair aneurysms.

Bill Gates, whose company, Microsoft, is one of the major investors in Intellectual Ventures, says, "I can give you fifty examples of ideas they've had where, if you take just one of them, you'd have a startup company right there." Gates has participated in a number of invention sessions, and, with other members of the Gates Foundation, meets every few months with Myhrvold to brainstorm about things like malaria or H.I.V. "Nathan sent over a hundred scientific papers beforehand," Gates said of the last such meeting.

On finding good ideas:

Myhrvold admits that many of the ideas that come out of the invention sessions come to naught. After a session, the Ph.D.s on the I.V. staff examine each proposal closely and decide which ones are worth pursuing. They talk to outside experts; they reread the literature. Myhrvold isn't even willing to guess what his company's most promising inventions are. "That's a fool's game," he says. If ideas are cheap, there is no point in making predictions, or worrying about failures, or obsessing, like Newton and Leibniz, or Bell and Gray, over who was first. After I.V. came up with its cancer-filter idea, it discovered that there was a company, based in Rochester, that was already developing a cancer filter. Filters were a multiple. But so what? If I.V.'s design wasn't the best, Myhrvold had two thousand nine hundred and ninety-nine other ideas to pursue.

Michael Butler, chairman of Seattle investment bank Cascadia Capital, has been sharing some of his insights on the venture business in guest posts on PEHub.com as part of a book he is writing.

A short excerpt from the latest, titled "The Death and Re-Birth of Venture Capital":

There's a very different kind of pile up today on Sand Hill Road, however. And it looks more like a car crash than a personal cash stash. Very few venture capitalists are crying poverty, but the VC industry is undergoing a wrenching and major restructuring that will cause unfamiliar pain and dislocation for a long time to come.

To put it bluntly, the venture capital model is broken and even the smartest VC's aren't sure how to fix it – or if it can be fixed at all.

While they're looking for elusive answers, the venture business is being partitioned into two sub-segments – the winners, who represent 20 percent of the firms, and the also-rans, who account for the remaining 80 percent.

Butler goes on to list five reasons why the venture industry will continue to contract, while offering additional insights on what type of venture firms will survive. (Madrona Venture Group is offered as an example of a regionally focused firm).

A good read.

The former chief executive of Postini, which was gobbled up by Google last fall for $625 million, has joined Seattle-based PivotLink as CEO.

Quentin Gallivan, who prior to leading Postini served as executive vice president of worldwide sales at VeriSign, said that PivotLink's business intelligence software could be transformational.

The appointment is a shot in the arm for PivotLink, which provides business intelligence software to companies such as REI, Bartell Drugs and Car Toys. The Web-based product allows companies to access corporate data related to a number of key business functions, incluing sales and vendor relationships. In the new role, Gallivan will help build out PivotLink's sales and marketing functions.

Frank Fulton, who previously served as CEO, will return to the position of senior vice president of operations and services. PivotLink, formerly SeaTab Software, scored $9 milllion in funding last fall.

Gallivan is the third CEO at the company in the past two years, though Fulton held an interim title while leading the search.

Glassdoor.com, the secretive Internet startup founded by former Expedia executives Rich Barton and Robert Hohman, today unveiled its board with yet more connections to the online travel sector.

Former Expedia Chief Executive Erik Blachford, TripAdvisor Chief Executive Stephen Kaufer and former Snocap Chief Executive Rusty Rueff have been named to the board, joining Barton and Hohman.

So what is Glassdoor all about? Given the involvement of experienced executives from the online travel category, one might think that they are trying to do an Expedia 2.0.

But I was told that they are doing something related to online jobs. (A new twist on Jobster perhaps?)

Wherever the Sausalito, Calif.-based company ends up, one can imagine that the Internet startup will follow the principles that Barton laid out in his keynote address earlier this month at the Drilling Down on Local conference. In that talk, the former Expedia CEO noted that Glassdoor, Avvo and Zillow -- all backed by Benchmark Capital -- share similarities in how they unlock information and build community on behalf of consumers.

So based on that, one can imagine a Glassdoor vertical search service where job seekers claim profiles, receive ratings and connect with employers. After all, that's what Avvo is doing with lawyers and Zillow with homes.

That's a little speculation, but if Glassdoor is heading down that path it might not only collide with Jobster but Bryan Starbuck's TalentSpring.

It will be interesting to watch. Glassdoor promises that more details are coming soon.

It's been less than a week since Carla Corkern was named interim CEO of Talyst.

But Corkern, who previously held the COO title, is already feeling good about the prospects at the Bellevue provider of pharmacy automation technology.

Talyst's Carla Corkern

So are the existing investors. Today, AIG, Ignition Partners and OVP Venture Partners are committing another $20 million to the company, with $8.5 million immediately available and the remainder to come next year. That follows a $20 million round from 2006.

The financing comes five days after co-founder Jim Torina resigned as CEO, raising questions that the financing may have been contingent on him leaving.

But Corkern says that Torina, who remains a shareholder but is no longer involved in the day-to-day operations, had been planning to step down earlier this year. She said Torina, who wanted to pursue more entrepreneurial activities, felt good about moving on with the venture funding and new management in place.

"I think the timing is coincidental," said Corkern. "As a stockholder, he felt good to step aside at this point because things were all set up to go."

Lucinda Stewart, a board member and venture capitalist at OVP, said that Torina's departure is part of a "natural evolution" of Talyst moving from a small, entrepreneurial organization to one that could be a large, profitable company. She called 2008 a "maturing year" for Talyst, with implications on the leadership and staffing.

Over the past few months, Stewart said, the company has focused on operations and profitability, two key metrics that she believes could put Talyst on the IPO path in the next two or three years. Revenue is expected to reach about $40 million this year.

Talyst considered taking a larger round of funding from outside investors, but Corkern said the company decided against it because of concerns over dilution of the shareholder base. The $8.5 million should get the company to profitability, which is targeted for next year.

Formerly Integrated Healthcare Systems, Talyst plans to use the fresh capital to expand into new categories. It is testing the automated drug delivery mechanism at a California prison and a Texas long-term care facility, both of which are new market segments. A less developed product test is occurring at a small retail chain.

Historically, Talyst has sold to hospitals, which use the hardware and software system to dispense pills, label medications and manage drug inventory at internal pharmacies. About 300 hospitals are using the technology, which typically costs about $300,000.

continue reading

The 7.9 magnitude earthquake that has claimed more than 13,000 lives near Chengdu, China rattled the offices of one Seattle startup.

Movaya Wireless, which opened a development center in Chengdu in the summer of 2006, employs 15 people in Chengdu under the direction of co-founder and chief technology officer Stanley Wang.

Movaya Chief Executive Phil Yerkes reports that the staff and their families are safe.

"Miraculously, all of our employees were unharmed in this tragedy and there will be limited business impact. Sadly, this cannot be said of many other businesses and people, many of whom have lost their businesses, their homes and their loved ones," said Yerkes in a blog post.

More on the impact on Washington residents and businesses in today's P-I story.

Celebrating its 25th anniversary this year, OVP Venture Partners is the granddaddy of the Seattle venture capital industry.

But this elder statesman is not slowing down as it enters the golden years.

In fact, based on conversations I had with several partners today at the firm's annual Technology Summit, things have heated up in the past nine months. And OVP is moving in some new directions.

Managing Partner Chad Waite told me that the firm has five term sheets in various stages of negotiation, an extraordinarily high number that he said speaks to the quality of entrepreneurs that are emerging in the Northwest. Some follow-on financings also are close to being announced.

Interestingly, two of the new deals involve Seattle-area startups in the digital media arena (one deal closed today) and another two are in the clean tech space.

Historically, OVP has not spent a lot of its efforts in those categories, focusing instead on digital biology, computer networking and security.

OVP's Lucinda Stewart

But that may be changing, with a slight twist.

Managing partner Lucinda Stewart said the firm sometimes gets a "bad rap" for not participating in the digital media/online advertising sector.

But she said the core philosophy at OVP as it relates to the Internet is to focus on the next wave of "analytics, tools and infrastructure" that will help companies make sense of the content created on the Facebooks and MySpaces of the world. It essentially wants to help companies analyze data so that they can better target customers, an area where OVP has already scored with the sale of Bellevue's Intelligent Results to First Data Corp. last year.

"This first wave of B2C social networking stuff, we are glad it got developed because it created a multibillion-dollar market and a multibillion-dollar potential value in the data," said Stewart. "Now, what we want to do is go do something with the data."

The latest investment, which Stewart declined to disclose, was started by experienced entrepreneurs directly in that space. And she is looking for other investments, forming an advisory board of experts such as Dave Jakubowski of Specific Media that are helping guide the firm along.

In fact, OVP has used that model to expand into other areas, most notably Waite's push into digital biology following the successful sale of portfolio company Rosetta Inpharmatics to Merck for $620 million in 2001. That sector now constitutes an important part of OVP's portfolio, with companies such as Nanostring Technologies and Complete Genomics.

Stewart said they are taking a page out of that playbook to do the same thing in digital media and clean tech.

"What I think OVP does really well, is that we think about stuff and then build a war chest of people and thoughts and networks before we go after something," she said.

That counters the approach of some venture firms, which she said use the "spray and pray" approach to investing: Toss out 10 investments and pray that one hits it big.

"That is just not our style," she said. "We will never be the company that has the most deals done in a year. But when we do deals, I think we do them really thoughtfully."

And the partners are hopeful the strategy pays off, allowing them to pursue another 25 years of innovative companies. Gerry Langeler, for one, said he hopes to be wheeled up to the 50th anniversary of the firm, adding that there is "nothing as energizing" as being around entrepreneurs who want to change the world.

I am reporting today from the Fairmont Olympic Hotel, where OVP Venture Partners is hosting its fifth annual Technology Summit.

We've already heard from Amazon's Werner Vogels on the benefits of cloud computing.

Now, Fritz Lanman, director of online services strategy and M&A at Microsoft, is sharing the stage with former Yahoo executive Ellen Siminoff.

Lanman played a key role in Microsoft's bid for Yahoo, which set up a chance to hear the nitty gritty of the deal.

"We have $44 billion to spend now, so you guys should be pretty excited," said Lanman, who was speaking to a room of entrepreneurs and venture capitalists.

But Lanman didn't budge when prodded by moderator Dave Jakubowski to elaborate, saying he was explicitly told by Microsoft bosses Chris Liddell and Kevin Johnson to keep quiet on the deal or face losing his job.

Given that scenario, Jakubowski said he would let Lanman off the hook.

The two executives went on to discuss the best approaches for pitching an idea to a big tech company, new opportunities on the Internet and online advertising techniques.

In her closing remark, Siminoff probably offered the best advice to finding the next $1 billion entrepreneurial idea. "Be lucky and have really good timing," she said.

More to come later.

UPDATE: Since there has been some reader interest in Lanman's comments about Yahoo, I went back to listen to the full text.

Microsoft wanted to do the Yahoo deal because of "massive consolidation" going on in the online advertising space, with Lanman saying "to maximize the benefits of liquidity" there really should only be a few advertising networks. He compared it to the financial markets where there are two major stock exchanges.

As to search, Lanman said that they were "afraid of an emerging power forming a monopoly." (Can anyone say Google?)

"We saw the Yahoo acquisition as a away to accelerate our existing strategy," said Lanman, adding that he didn't have anything more to report.

Amazon Web services and cocaine share at least one common attribute. Once you try, it's easy to get hooked.

That was one of the messages this morning as Amazon.com Chief Technology Officer Werner Vogels discussed the history and growth of the hosted offerings that are now a key part of the company's strategy.

The cocaine comment came after Vogels showed a slide from a ZDNet blog post that said: "Amazon will be like a book store that sells cocaine out the back door. Books will be just a front to sell storage and cloud computing."

Vogels used several examples of companies -- from The New York Times to SanDisk to small startups such as Animoto -- that have benefitted from outsourcing computing tasks to the online retailer.

"Amazon is a technology company deep down in its heart, we just happen to be doing retailing," said Vogels, who spoke this morning at OVP Venture Partners' fifth annual Technology Summit in Seattle.

Listening to Vogels discuss the systems that power Amazon and other third party applications convinced some people of that statement, with OVP's Gerry Langeler saying that the company probably has more computing power at its disposal than any organization except for the Department of Defense.

Vogels laid out the history of how Amazon moved into the Web services business, offering storage, payment and bandwidth infrastructure to other companies in what has come to be known as cloud computing. Really, the strategy emerged from the company's own technology needs, a desire to create a "massively scalable" technology offering that is easy to operate, upgrade and deploy.

Over the past five or six years, Amazon has worked hard to replace a database system that Vogels said pretty much was put together with "duct tape and WD-40." But in 2001 it started to move to a services infrastructure, partly because it wanted to build a platform that could handle transactions for third party retailers such as Target.

Today, he said the services infrastructure is a well-oiled machine, noting that there is a "one bug, one fix" solution. At the peak holiday periods now, developers pretty much just "sit around in a room waiting for something to happen."

"We could lose a complete data center and you as a customer wouldn't know it," said Vogels, adding that the company occasionally tests that theory by purposely shutting off data centers.

continue reading

Following the announcement of its planned merger with Sprint Nextel's WiMax unit last week, Clearwire today issued its first quarter earnings report.

The Kirkland company's revenue grew 76 percent to $51.5 million, but the net loss also increased.

Clearwire lost $176 million during the first quarter, up from $92 million in the same period last year.

The company finished the quarter with 443,000 subscribers and $110 million in cash.

It was another bad day on Wall Street for Clearwire, with the stock losing 9.5 percent of its value to close at $12.75. It regained a little ground in after hours trading, rising 25 cents to $13.00.

Meanwhile, The Wall Street Journal reports that Sprint affiliate IPCS is suing over the Clearwire deal, alleging that it has rights to offer broadband wireless service in select markets from a 1999 agreement it signed with Sprint. Sprint also reported first quarter financials, losing more than one million wireless customers and a net loss of more than $500 million.

"This is a nightmare game of whack-a-mole where new problems keep popping up faster than you can address," Bernstein analyst Craig Moffett tells Reuters about Sprint's troubles.

Meanwhile, VentureBeat counters the "disaster" scenario that TechCrunch laid out for the Sprint-Clearwire deal.

Microsoft's purchase of Farecast for $115 million dominated the top posts for April. Here's a look at what people were reading on the blog last month.

1. Secret Farecast buyer is Microsoft
2. Source: Farecast sold for over $75 million
3. Google takes aim at Amazon
4. Former Expedia CEO discounts Google rumors
5. Roundup: Is Amazon the worst stock of 2008?
6. Amazon prepared for battle with Google, MSFT
7. Farecast's sale and Etzioni's "no comment"
8. Should Microsoft buy Yahoo? Panelists say no
9. Maveron takes a hit with Eos Airlines bet
10. Illumita is now Skytap, unveils first product
11. Blue Frog mess ends with Ch. 7 nullified
12. Art of the deal: Details on the Farecast sale
13. Angel investors on the prowl
14. Seattle: Land of nearly 1,000 yoga classes
15. More legal troubles for Isilon

When Fate Therapeutics announced a $12 million venture round last year and the involvement of some of the top scientists in stem cell research, venture capitalist Robert Nelsen said he was hopeful that the company would be based in Seattle.

"The company is here, and we intend to build it here," he said. "I hope we can find the right CEO here."

Turns out they didn't. Fate has named San Diego venture capitalist Paul Grayson to the CEO post.

P-I reporter Joe Tartakoff is tracking the story on his blog.

But it does raise issues about the depth of talent in the Seattle biotech industry.

Snaptune, the online radio service started by veteran technology entrepreneur Bill Baxter, has run into problems and appears to be on its last legs.

Cozi CTO Bill Baxter

Meanwhile, Baxter is now listed as the chief technology officer at Cozi, a Seattle Internet company that offers calendar, photo and planning tools to families.

In an e-mail, Baxter said he was surprised that someone noticed that Snaptune was not working. (The Web site is now down.) And the former chief executive at Bsquare said he was "disappointed" that they could not grow the business.

"We migrated the hardware to a new location and we're running into problems returning to full operations. We're working to resolve it," he said in the e-mail. "In the meantime, people have lost the song identification ... station directory services until they return to operational status. People will, however, be able to continue to record and timeshift and when these services are restored, all the songs for which they hadn't previously had identifying data (artist, title, etc.) will be identified."

David Pankiw, a Snaptune user from Montreal, encountered problems and error messages with the Web radio service last month. If the company has closed, Pankiw said, it should notify customers.

"The only plus side is that my Snaptune came with FM tuner and it still works with FM
radio stations," he said. "However, the Web radio was where things were really fun."

Snaptune's software allowed computer users to record and classify thousands of songs from Internet radio stations, a potential legal quagmire that I discussed in this March 2006 story on the company.

As to Baxter's new role, Cozi founder Robbie Cape said the company is happy to have him on board. He joined in January.

"Bill is an amazing technologist and we are so fortunate to have him in the CTO spot," he said.

Bag Borrow and Steal got its start renting designer handbags for a monthly fee, a service that earned the Seattle startup the nickname the Netflix for handbags.

Roberto Cavalli sunglasses for $60 per month through BBoS

Then it expanded into jewelry. Now, in its latest offering, the company has begun offering sunglasses for rent.

Monthly rental fees for the sunglasses -- from 25 designers that include Chanel, Gucci and Louis Vuitton -- range from $25 to $200. Don't people lose sunglasses all of the time, making a rental service exceptionally challenging?

In an interview last summer about their $15 million funding round, Bag Borrow or Steal Chief Executive Michael Smith told me that sunglasses were one of the product categories that it was thinking to add. Others included belts, watches and shoes. That's right, rented shoes.

I've noted before that the company may need to change its name, since Bag Borrow or Steal no longer conveys its growing product categories.

A reader last year suggested a name that conveys the luxury goods it rents: Leasury.com.

Not bad, but looks like it is already taken.

Multiple Listing Services across the country are getting more comfortable with the idea of feeding lists to online real estate upstarts, with The New York Times reporting:

"The triple threat of a weak market, legal pressure and increasing competition has compelled real estate professionals to offer their information more freely online, putting cracks in a walled garden of data that stood strong while the industry enjoyed its breakaway growth. It also presages an end to the days when sellers must list their homes with a broker so buyers can see them."

The story mentions new efforts by Redfin and Zillow, including Redfin's new offering to post foreclosure and for-sale-by-owner properties next to MLS data.

VentureBeat reports on the demise of Pleasanton, Calif., Internet phone company Jangl and notes that Seattle-based WhitePages.com was sniffing around the assets.

Citing an anonymous source, VentureBeat reports that WhitePages offered $20 million for Jangl, but then "whittled down" the offer once it found out that Jangl was facing financial problems.

WhitePages.com Chief Executive Alex Algard tells me in an e-mail exchange that they never bid $20 million "or anything even close to that for Jangl."

"We are a growth-oriented company constantly seeking good acquisition opportunities, but we don't announce which business opportunities we pass on, for a variety of reasons as you can understand," said Algard.

The fact that WhitePages.com was considering a purchase of Jangl indicates that the company is looking for new and creative ways to expand the business.

That's not a big surprise. In an interview earlier this year, Algard discussed several new initiatives to build on the idea of helping Internet users find and connect with one another. One is allowing people to input cell phone numbers on their personal profiles on the site, a feature that WhitePages started testing late last month.

Given the company's goal of reaching $200 million in revenue in three years and its plans to upgrade its legacy online directory businesses, I wouldn't be surprised to see WhitePages expand with acquisitions.

Profitable with $62 million in revenue last year, WhitePages should have both cash and stock as currency. It also has laid off workers in the past 18 months, further indication that it is trying to reposition.

In March, WhitePages Vice President of Marketing John Lusk told me that the 11-year-old company had to become more innovative in how it brought products to market.

Maybe it is looking for startups to help in that mission. Stay tuned.

TechCrunch offers seven reasons why the $14.5 billion Clearwire-Sprint Nextel deal announced this week is a potential "disaster," noting the huge losses at Clearwire, unproven WiMax technology and lack of global standards on which companies can make WiMax equipment.

Investors appear to agree, sending the stock of Clearwire down four percent Friday to close at $14.10. It fell another five cents in after hours trading, with the stock nearing its 52-week low of $10.10.

It must be the week for top executives at venture-backed companies to set sail. I just reported on the departure of Avvo co-founder Paul Bloom.

Now, I've learned that Talyst Chief Executive Jim Torina is leaving the company that he co-founded. He's being replaced on an interim basis by Carla Corkern, who most recently held the title of chief operating officer.

Torina told employees of his departure today.

Talyst, whose technology is used to automate hospital pharmacies, hit a rough patch earlier this year when it announced the lay off of 17 employees.

In 2006, the company raised $20 million in a deal led by OVP Venture Partners and Ignition Partners.

At the time of the financing, Torina expressed ambitious plans for the Bellevue company.

"The market is very large and the timing is right for this," Torina told the P-I. "We believe that every person that takes medication could eventually be taking a drug out of our system."

UPDATE: Here's the latest on Talyst, which announced a $20 million commitment from AIG, Ignition Partners and OVP Venture Partners on Wednesday.

Paul Bloom, who co-founded the online attorney rating service Avvo, plans to step down from the 22-person company to pursue other opportunities.

Bloom, who served as vice president of products and marketing, notified employees of the decision Thursday. Avvo Chief Executive Mark Britton said that Bloom wanted to be more involved with product management rather than people management, adding that the departure does not signal internal problems.

"That perception could not be further from the truth," said Britton, adding that the company has been expanding into new markets and adding new employees. It also recently inked a deal to provide the results for Washington CEO magazine's upcoming "Top Lawyers" issue.

Bloom, who previously worked at Classmates.com, Apex Learning and Microsoft, played a key role in the early product vision. Britton said he was a huge help in getting the service launched, adding that he will be missed.

"It is tough because I started the company with Paul and he is an amazing person," said Britton, who was unsure whether he would refill the position.

Bloom plans to stay with the company -- backed with $13 million from Benchmark Capital, Ignition Partners and others -- through a transition period. It has not been determined if he will step down from the board as well.

Internet pioneer Vint Cerf today told about 800 people at the Technology Alliance's annual luncheon about the early days of the Internet, the promise of government-funded broadband networks and how to brew the perfect cup of coffee.

Oh yeah, he also answered that burning question: Does the term "surf the Net" originate from his name?

It does not. First, since this is Seattle, how does "the father of the Internet" like his coffee. The key, he said, is to grind the coffee and then let it sit in a cold pitcher of water overnight. Doing so removes many of the acids, Cerf said.

After discussing his coffee habits, Cerf jumped into the topic that most of the audience came to hear.

"OK. Go for it, Internet," he said to laughs as moderator Ed Lazowska fired up his questions.

Cerf said that the Seattle technology industry is among the leaders in the world, but many people outside the region don't realize the impact it is having.

"I am really damned impressed," he said.

Cerf, who from 1976 to 1982 played a key role in the Defense Department's development of what became the Internet, said it has been a "roller coaster ride" in terms of where the technology has gone.

And just like society in general, Cerf said that people use the Internet for "good and ill."

continue reading

The chairman and chief executive of one of Seattle's largest software companies has been charged with killing 32 bison on a neighbor's ranch in Colorado.

Jeff Hawn, the chairman and chief executive of Attachmate, has been charged with 34 counts of theft, criminal mischief and aggravated cruelty to animals, according to an arrest warrant obtained by Colorado's 9News.com.

The warrant says that Hawn killed two of the bison, while he hired hunters to kill the rest on March 19. Here's more from the 9News.com report:

The hunters with the Atzlan Native Community killed 32 bison belonging to rancher Monte Downare on March 19, including six bulls and some cows that were carrying calves. The arrest warrant said some of the bison were skinned while most of the rest were left to rot.

The dead animals were found over hundreds of acres near Eleven Mile Reservoir in Park County. Authorities say only eight of the bison were killed on Watersedge Properties, which is owned by Hawn. The remaining 24 bison were killed on other property.

The Los Angeles Times reports that Hawn, who lives in Austin, Texas, bought his 362-acre ranch in 1995 and shortly after constructed a fence to keep out livestock. But the fence did not keep out the bison, which under open range laws are able to wander.

Attachmate, which is privately held and makes software to access information from mainframe computers, merged with rival WRQ in one of the largest private equity transactions in the state in 2005. At the time, the combined company employed about 950 people and posted annual revenue of more than $200 million.

Hawn, a former senior vice president at BMC Software and partner at McKinsey, joined WRQ in 2005.

I have a call into Attachmate to see what this means for the company.

The story is big news in Colorado, with the Rocky Mountain News' Bill Johnson calling it "a contract massacre."

Meanwhile, The Denver Post has some gruesome photos of the dead bison and links to the arrest warrant of Hawn. An undersheriff for Park County, where the killings took place, tells the Denver Post that arrangements are being made for Hawn to turn himself in to authorities.

UPDATE: I just heard back from Attachmate spokeswoman Susanne Smith, who would only confirm that Hawn remains the CEO of the company at this time. She declined to answer questions about the potential impact on the company or whether Hawn planned to turn himself in.

UPDATE: Here's my full story, which includes another comment thread.

And the winner of the Technology Alliance's annual startup of the year award is ... a coffee company.

Seattle's Coffee Equipment Co., which was recently sold to Starbucks, was announced as the Alliance of Angels' startup of the year.

In accepting the award this afternoon, Chief Executive Zander Nosler joked that they have been telling people all along that they are a technology company. No one ever believed them, he said.

In fact, investor Geoff Entress tells me that "there is a ton of technology in the device," including software that would allow Starbucks to monitor how much coffee is flowing through the machine remotely.

The company beat out BuddyTV and CleverSet.

The last time I bumped into Phillip Lee he was a University of Washington business student running an online apartment search service called Spottage.com.

Lee has now graduated, launched the service on five college campuses in the Northwest and changed the name of the company to Spottago (more on that unusual story later).

A presenter at today's Early Stage Investment Forum, Lee detailed how the recently-launched company plans to make money by helping students find a place to live.

Backed with about $100,000 in startup capital, Spottago shows apartment listings near college campuses on an online map. It then shows how close those apartments are to bars, restaurants and grocery stores.

The company, which launched last month, also offers a business directory and a roommate finder service.

In his presentation, Lee noted that 13 million students live off campus, representing a $23 billion market that turns over every year. Furthermore, he said the market is highly fragmented with the big three apartment owners representing about five percent of the market.

I've written a lot about local search around targeted communities, a trend that Spottago is definitely hitting on. Lee told me that the service is especially attractive to advertisers since the vast majority of users live within a few miles of local businesses. That means a pizza shop could offer a coupon on the site and get higher click through rates, he said.

continue reading

It is often said that a democracy only works if the citizens are well informed.

Ameritocracy.com is hoping that it can do its part to keep the wheels of democracy moving. The Seattle startup is developing a new online service that allows readers to rate the credibility and relevance of political news stories and politicians' comments.

Though still a month or so away from launch, the site has already been mentioned in the gossip pages of The New York Post. That's because of the Kennedy connection.

Robert Kennedy III -- the grandson of Bobby Kennedy -- is among the five employees working to promote and develop the new service.

Kennedy is a good friend of founder of Porter Bayne, a 28-year-old Seattle software developer who came up with the concept for Ameritocracy during the last presidential election.

"I was getting really concerned of the impact of misinformation," said Bayne. "I was shocked to see that perfectly intelligent people that I would hop into a debate with were basically repeating back to me hook, line and sinker quotes and factoids straight from the Bush campaign and the Kerry campaign."

Bayne started tinkering with ways by which readers could rate or promote political news content, a concept that also drives services such as Digg, Reddit and Newsvine.

While other services aggregate news content from readers, allowing them to vote on whether a story is compelling or not, Bayne said his company has a slightly different approach. For political coverage, Bayne said a binary rating system like the one at Digg creates problems because it encourages a "homogeneous community."

"Two thousand people might vote up and 2,000 people might vote down, and it looks like that content is flat-lining or that is not interesting to the community, when in actuality it is controversial and it is very interesting," he said.

The Ameritocracy site allows readers to vote on whether an issue or a political candidate's statement is relevant or not. For example, the community could vote on whether Jeremiah Wright's comments are relevant to Barack Obama's campaign.

continue reading

It's been a little busy around here the past couple of days with Clearwire's merger and RealNetworks' decision to spin off its games business into a separate company.

Because of those two breaking stories, I've missed some of the smaller tidbits. Here's a quick look:

RealNetworks is spinning off its games business into a separate company, with the possibility of an initial public offering.

The games business was the second-biggest revenue generator for RealNetworks during the first quarter, with $31.8 million in sales. Last year, the games business grew 26 percent and accounted for $108.5 million in sales.

"RealNetworks was a pioneer and has been a leader in the casual games industry since we introduced RealArcade in 2001," said RealNetworks Chief Executive Rob Glaser in a news release. "We believe that spinning off our casual games business will give it the best opportunity to continue to flourish and lead."

The release does not say what the new company will be called, but a frequently asked questions sheet indicates that it most likely will be located in Seattle.

RealNetworks plans to make a decision about the spinoff and potential IPO by the end of the year, with the company writing that a separate company could more easily attract talent.

The company anticipates that spinning off its casual games business will result in two more flexible and focused companies. In addition, the separation will provide the games business an industry-specific currency for future acquisitions and enhance its ability to attract and retain the best talent in the industry.

Real also announced its first-quarter results, reporting revenue of $147.6 million and net income of $2.4 million.

RealNetworks has used some of its cash from the Microsoft antitrust settlement to invest heavily in games.

Here's a look at the acquisitions with links to the press releases:

2008:

Cory Bergman is leaving KING-TV and KING5.com after seven years to join MSNBC.com as director of business development.

At KING, Bergman was instrumental in starting the Citizen Rain aggregator of Seattle blogs. He also is the gatekeeper of the popular Lost Remote blog, which he says will continue.

"In recent months, I've come to believe that the media industry needs business innovation as much or more than it needs content innovation. As a geek journalist with an MBA, that's why I've decided to make the shift to the business side of the online media world," writes Bergman in a blog post.

Clearwire Chief Executive Ben Wolff will have his hands full as he attempts to build out the country's first nationwide WiMax network by 2010, an undertaking he admits is "ambitious." But the 39-year-old executive got a big boost -- some may call it a reprieve -- when Google, Comcast, Intel and others yesterday announced plans to pump $3.2 billion into a new Clearwire that also includes the assets of Sprint Nextel's WiMax assets. (The stock is taking a beating today).

Clearwire's Ben Wolff

I interviewed Wolff yesterday afternoon about the complexities of the deal, the involvement of Clearwire founder Craig McCaw and the role that Seattle will play in the new Clearwire.

Some of his comments appeared in my story today, but I wanted to share a few more details.

Shares of Kirkland-based Clearwire fell more than 12 percent in heavy trading today and are now off about nine percent, a sign that investors don't like everything they see in the merger with Sprint Nextel's WiMax assets.

The stock, now trading at $14.70 and hitting a low of $13.81, took a hit after research analysts questioned the $14.5 billion valuation of the new company.

"Being a start-up using evolving technology with an unproven model, we believe a $14.5 billion valuation for the company is too high," UBS analyst John Hodulik said in a research note reported by Reuters.

Meanwhile, Bloomberg News reports that Citigroup analyst Michael Rollins put a sell rating on Clearwire's stock.

"The business model still faces operating and financial hurdles at an early stage of its buildout. The same challenges remain for the combined businesses with respect to a coverage plan that reaches less than half of the U.S. population by 2010.''

Isilon Systems, the Seattle digital storage company, posted a 35 percent increase in revenue during the first quarter as sales increased to $24.1 million.

But the net loss also grew, with the company losing $10.1 million during the quarter. That compares to a net loss of $6.9 million for the same period last year.

"I am encouraged by these results as we emerge from the challenges of the past few quarters," said Chief Executive Sujal Patel in a statement. "Despite recent business headwinds and a seasonally slower first quarter, we witnessed record levels of repeat purchases from existing customers, reflecting Isilon's strong value proposition and the modular, 'pay as you grow,' architecture of our clustered storage systems."

Clearwire and Sprint Nextel are joining forces to create a nationwide broadband wireless network, a highly anticipated combination backed with $3.2 billion from Intel Corporation, Google, Comcast, Time Warner Cable and Bright House Networks. John's Stanton's Trilogy Equity Partners also is expected to invest $10 million.

Sprint Nextel's Dan Hesse

The $14.5 billion deal, first reported by The Wall Street Journal, comes less than seven months after Sprint Nextel and Clearwire called off a planned partnership. But much has changed in that period, including the appointment of former AT&T Wireless Chief Executive Dan Hesse as the CEO of Sprint Nextel.

The company, which will retain the Clearwire name and Kirkland headquarters, is expected to trade on the Nasdaq under the ticker "CLWR." Target price for the new company is $20 per share.

Craig McCaw will serve as nonexecutive chairman, with current Clearwire Chief Executive Benjamin Wolff retaining the CEO slot. Sprint Chief Technology Officer Barry West will hold the title of president.

The board eventually will include 13 members, with Sprint's Dan Hesse, Comcast Chief Executive Brian Roberts; Time Warner Cable's Glenn Britt and Trilogy's Stanton expected to serve. Meanwhile, Sprint will have the ability to appoint seven directors, while the strategic investors may appoint four. McCaw's Eagle River investment arm may appoint one board member under the current structure.

Here's what some of the players are saying in the press release:

McCaw:

"We believe that the new Clearwire will operate one of the fastest and most capable broadband wireless networks ever conceived, giving us the opportunity to return the U.S. to a leadership position in the global wireless industry."

Intel Chief Executive Paul Otellini:

"This agreement is a historic step forward for WiMAX as it represents the first nationwide deployment of a next-generation mobile broadband Internet in the U.S."

Google Chief Executive Eric Schmidt:

"Google is a firm believer in supporting new ways for people to access the Internet."

Comcast's Roberts:

"This transaction is attractive to us strategically and financially and puts in place very attractive wholesale relationships for access to Sprint's existing 3G and Clearwire's 4G networks, giving us complete flexibility to introduce wireless mobility in terms of product innovation and deployment."

The companies plan to have the new wireless network covering between 120 million and 140 million people in the U.S. by 2010, with Sprint transferring equipment and intellectual property to Clearwire. But even with the heavy hitters lining up behind the new entity, Clearwire will need to raise approximately $2.3 billion more in order to reach coverage goals, according to Bloomberg.

Research analyst Michael Nelson tells Bloomberg News that the deal is "positive for Sprint, but potentially transformational for Clearwire.''

Shares of Clearwire, which opened at $17.77, are trading at about $16.35. About 8.5 million shares have changed hands about eight times the average volume.

More to come.

Here are a few headlines from around the Web:

If Clearwire and Sprint Nextel ink a $12 billion joint venture -- as was reported earlier today by The Wall Street Journal -- there will be some interesting plot lines that run deep in the Seattle wireless industry.

Craig McCaw

It is well known that Clearwire is based in Kirkland, started by wireless pioneer Craig McCaw.

But Sprint Nextel has some interesting Seattle connections as well. Its recently-appointed CEO is Dan Hesse, who before being tapped for the top job at the Overland Park, Kansas-based telecommunications giant spent time in Redmond as CEO of Terabeam and AT&T Wireless.

Of course, there should be some level of familiarity between the two executives. After all, McCaw sold his cellular company to AT&T in 1993 for about $12 billion. (Interestingly, that's rougly the same value that the Journal is placing on the new Clearwire joint venture.)

Hesse then joined the company, rebranded as AT&T Wireless, as chief executive in 1997.

It will be interesting to see if these two titans of the wireless industry can deliver on the promise of a broadband wireless network, something they both have been kicking around for more than a decade.

Meanwhile, Tricia Duryee of MocoNews asks if there may be too many cooks in the kitchen with this joint venture. After all, the power players involved not only include McCaw and Hesse, but Google's Eric Schmidt and Comcast's Brian Roberts.

UPDATE: The New York Times also points out that the consortium of companies -- while powerful -- could make the joint venture difficult to manage since each has different needs.

But it was the last line in the story that caught my eye. In addition to the big name investors already reported by the The Wall Street Journal, Seattle area venture capital firm Trilogy Equity Partners plans to invest $10 million, according to The Times.

Trilogy is the venture capital firm of former VoiceStream Wireless and Western Wireless Chief Executive John Stanton, which adds yet another titan of the Seattle wireless scene to the syndicate.

It will be interesting to see who sits on the board of the joint venture.

Maybe we will find that out tomorrow since it looks like an announcement is coming. I have a call into Clearwire, but haven't heard anything at this point.

Jack Faris plans to resign as president of the Washington Biotechnology and Biomedical Association after a little more than three years on the job.

P-I reporter Joe Tartakoff has the news and the resignation letter in which Faris says he wants to spend more time with his f