TheNextRound, a Framingham, MA-based startup that makes software for private equity and alternative investors, has been acquired by Windsor, CT-based SS&C Technologies for an undisclosed amount, according to an SS&C announcement today. SS&C makes financial management software for insurance companies, hedge funds, banks and credit unions, real estate companies, and other institutions.

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The second half of 2009 provided a good measure of optimism, easing some of the pain investors felt toward the end of 2008 and in early 2009. The stock market has been volatile but up significantly overall. There are signs of increased lending activity. Mergers and acquisitions have picked up. And there’s a pulse in the IPO market.

Yet despite indications of recovery, we shouldn’t be lulled into thinking we’re over the crisis. The labor, housing, and consumer markets are still struggling. And there’s still plenty of fear and uncertainty as we emerge from the longest downturn since the Great Depression.

Keeping that cautionary note in mind, what do the recent positive strands of hope in the IPO, M&A, and credit markets tell us?

To begin with, a potential increase in IPO listings isn’t necessarily a signal that capital markets have returned to normal. Why? Because the companies coming to market are the best of the best, the ones who have survived the past 24 months of havoc and have continued to build on sound business fundamentals.

And that’s the point—we’re not out of the woods yet; every company that wants to go public isn’t going to succeed. After the initial IPO backlog is worked down, the next wave of public offerings, if any, will continue to present a challenge and will come from specific sectors that investors see as the leaders in potentially expanding markets—for example, health care services and technology, financial services, and software and software services. Other, more traditional companies that can provide a compelling investor advantage and return will also be in the IPO mix.

Job growth in the health services and education sectors and annualized spending growth in the equipment and software sectors—ranging from 10 percent to more than 30 percent from Q3 2008 to Q1 2009, and evidenced by recent quarterly earnings growth by industry leaders—give some hint of recovery as well as an indicator of where the money may flow in the near future. Still, even though many institutional money managers need to invest and are waiting for the right opportunities—including IPOs—don’t expect to see a boom.

In fact, it may end up that growth will be fueled more by the credit markets than …Next Page »

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Seattle Genetics (NASDAQ: SGEN) announced today that it will be selling 11 million shares of common stock in an underwritten public offering for $10.75 a share. This is expected to raise about $118.2 million for the Bothell, WA-based developer of antibody cancer drugs. The offering is expected to close by Monday. Seattle Genetics’ stock price was $10.99 at market closing Tuesday, so the new offering gives buyers approximately two percent in savings.

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Waltham, MA-based biotech firm Altus Pharmaceuticals (NASDAQ:ALTU) ended the second quarter of 2009 with $8.1 million in cash, enough money to continue operations into September 2009, the company revealed yesterday.  “As a result of our current cash position and in order to continue operating the company, Altus needs to raise additional capital before the end of September,” Georges Gemayel, president and CEO of Altus, said in a statement. The company reduced its staff by about 70 percent and dropped the development of a cystic fibrosis treatment called liprotamase in March 2009 to focus resources on its drug ALTU-238, a weekly treatment for patients with growth hormone deficiency.

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In the year’s first initial public offering by a venture-backed company from New England, Woburn, MA-based remote access software maker LogMeIn has raised $80 million, according to a report late Tuesday night in the Wall Street Journal. Through lead underwriters Barclays and JP Morgan Chase, the company sold 5 million shares at $16 per share—the high end of the price range it had hoped the offering would bring.

Altogether, 6.67 million shares were sold in the offering, raising $107.2 million, according to the Journal. (PE Hub’s sources put the amount slightly below that, at $106.7 million.) Of that, $27.2 million will go to individual shareholders who sold parts of their stakes, including LogMeIn CEO Michael Simon and chief technology officer Martin Anka. LogMeIn’s stock will begin trading today on the NASDAQ exchange under the ticker symbol LOGM.

It’s only the fourth time in 2009 a U.S. venture-backed company has gone public, after a four-month period at the beginning of the year with no venture-backed IPOs at all.

Whether or not the sale heralds the gradual restoration of the IPO as one of the traditional exit paths for venture investors, it’s bringing respectable returns to LogMeIn’s investors. Altogether, venture backers put $20 million into the company, in return for shares now worth a collective $155 million, according to the Journal.

Prism Venture Works, the company’s single largest shareholder, comes out of the IPO with an 18.2 percent share of the company that’s worth $62.3 million at the $16-per-share price. Polaris Venture Partners sold shares worth $7.4 million in the offering and is holding onto a 13.9 percent stake worth $47.6 million. Intel Capital’s 4.2 percent stake is now worth $14.2 million, and Integral Capital Partners sold shares worth $5 million and retained a 5.4 percent stake worth $18.4 million.

Medidata of New York, OpenTable of San Francisco, and SolarWinds of Austin, TX, are the other three venture-backed companies that risked IPOs this year.

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Microsoft announced today that it will stop selling its personal finance program, MS Money, at the end of this month.  The Redmond, WA-based company cited banks and websites which provide similar services as the reason for discontinuing the program, which had already been removed from retail stores last year and is available only online.  This is the latest in a series of cost-cutting closures by Microsoft, which has recently shut down its encyclopedia Encarta, antivirus software Windows OneCare, and Digital Image Suite, a photo manipulation program.

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Veteran software entrepreneur and investment banker Michael Orbach is joining Seattle-based Cascadia Capital today. As a new managing director in the investment bank, Orbach will focus on mergers and acquisitions, as well as capital raises, in software and services—all in the mid-market range of $20 million to $500 million deals. The new hiring looks to be a strategic move to strengthen Cascadia’s national and global presence in information technology.

Orbach comes most recently from Palo Alto, CA-based Pagemill Partners. But he is a Seattle-area resident and says he has been commuting to Silicon Valley for 12 years. In the early 1980s, he co-founded Simulation Sciences in the U.K. (he’s a native of Manchester), and took the company public in the early 1990s. After Simulation Sciences was bought by Invensys, Orbach joined Aspen Technology and handled mergers and acquisitions, moving to the Seattle area with that company’s purchase of Industrial Systems, Inc. in Bothell, WA, in 1995.

“We liked the place,” Orbach says. “My family was suffering major culture shock between Manchester and California.” Orbach also got his MBA at the University of Washington.

The professional rationale for Orbach’s latest move is equal parts opportunity and timing. “There’s a very large opportunity to build a software and services practice here at Cascadia,” Orbach says. Cascadia Capital has a strong national brand in capital raising, and it can use that strength to grow its mergers and acquisitions business. That sort of leverage between M&A and capital raising expertise, he says, “is very appropriate in the market today.”

And why is that? “You tend to build out new business models and get the best growth strategy when you’re coming out of a recession,” Orbach says. And because of the dearth of IPOs, startups looking for an exit have little choice but to get acquired, he says. That, of course, gives buyers the upper hand in negotiations. “The economics of buying companies has never been better. For the Oracles, SAPs, and Microsofts, less and less will they make internally, and more and more will they buy,” he says. What’s more, how they’re buying has changed radically in recent years. “M&A has become a national/global practice,” Orbach says. “The days of looking at specific geographies or specific verticals are gone, because the technologies cross those.”

What all this means is that the precise skills of bankers making deals in the technology space are more important than ever. “The days of watching lawyers doctor the deal are long gone,” Orbach says. Bankers have to position a company’s financials to a prospective buyer in the right way, which means having a deep understanding of where the technology and the business model fits into the market, and of what the buyers want. Orbach says he draws on his experience as an entrepreneur, as well as having lived in many parts of the world with diverse cultures (the U.S. and U.K., France, Germany, Switzerland, and South Africa).

We didn’t get a chance in this conversation to dive deep into software M&A trends yet, but Orbach did offer a hint at what he’s looking at. “Venture capitalists are focused on triage. Many businesses need something done. Not only here, but everywhere,” he says. “As we come out of this recession, the dealmaking will be done in countercyclical markets.” He points to a few specific areas to watch: IT infrastructure, virtualization, legal, and corporate governance, risk, and compliance. We’ll be watching to see what effect this all has on Cascadia’s dealmaking, and the broader IT world.

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SS&C Technologies, a maker of financial management software based in Windsor, CT, announced yesterday that it has acquired Evare, a Burlington, MA company that handles financial data acquisition and transformation for banks, corporations, and asset managers. The companies didn’t reveal the terms of the deal.

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When I last crunched the numbers on the financial health of the Boston area’s public life sciences companies, back in November, I noted that 15 of them had more than $100 million stockpiled. These firms, I reasoned, were likely in a decent position to weather the economic storm. Now with quarterly financial reporting through December now in the books for most of the firms in the sector, I came to a surprising conclusion. There are now even more companies, 19, in that position of relative financial strength. Infinity Pharmaceuticals, Momenta Pharmaceuticals, Hologic, and Bruker are all newcomers to the $100 million club as of December 31.

Then again, in my review of the new numbers I also spotted 16 companies that likely had less than $50 million in the bank at year’s end (I say “likely” because three haven’t reported their numbers). That sign of thin reserves suggests those companies will face tough choices ahead.

Here’s the full rundown, in alphabetical order, of the 44 Boston-area life sciences companies for which I tracked down end-of-year financial figures.

—Abiomed (NASDAQ: ABMD). The Danvers, MA-based medical device company had $63.8 million in cash and investments at the end of December, and a $7.7 million net loss in the quarter. That’s more cash than it had socked away at the end of September—$50.6 million.

—Acusphere (OTCBB: ACUS). This biotech company has cut about two-thirds of its workforce, or 40 jobs, and consolidated all its facilities in a manufacturing plant in Tewksbury, MA. It has avoided making a formal financial report to the SEC, although it says the cuts will help it stretch its cash into the third quarter of 2009, which it hopes will buy enough time to come up with “financing alternatives.” The stock is down to 3 cents. Acusphere is a newcomer to the list, which I overlooked last time.

—Alkermes (NASDAQ: ALKS). This Cambridge, MA-based company has maneuvered itself into position of financial strength, with $423 million in cash and investments at the end of the year, and with a $112.3 million profit in the quarter. As I mentioned last month, Alkermes has potential for revenue growth this year if Eli Lilly and Amylin Pharmaceuticals win FDA approval for once-weekly exenatide for diabetes, which is based partly on a technology license from the Massachusetts firm.

—Alnylam Pharmaceuticals (NASDAQ: ALNY). This Cambridge, MA-based biotech company doesn’t have to worry about cash, with $512.7 million at the end of 2008, and a relatively skinny net loss in the quarter of $9.4 million. It expects to burn through no more than $77 million of its cash this year, ending 2009 with more than $435 million. Indeed, rather than fretting over finances, CEO John Maraganore is thinking about how to prioritize opportunities, as he told me last month.

—Altus Pharmaceuticals (NASDAQ: ALTU). Alarm bells must be going off at Waltham, MA-based Altus. This company used almost $90 million of its cash reserves in 2008, and closed the year with $48.6 million left in the bank. Even after cutting 107 jobs, or three-fourths of its workforce, Altus still expects to spend $50 million to $60 million for operations this year. It says it has enough cash to run “into the fourth quarter” and that it will try to raise more capital in the next three to six months. …Next Page »

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“If you’re a technology junkie, cleantech is the candy store for you,” said Byron McCann, co-founder and managing partner of Seattle-based Ascent Partners, an investment bank that advises cleantech and software entrepreneurs. McCann, who also serves on the board of the Northwest Energy Angels, was talking about his own transition from software to energy, and about his fascination with the complexities of cleantech. “Three years ago, I was doing some research, and the whole cleantech industry was starting to take off,” he said. “Now it’s on fire.”

McCann moderated a breakfast panel yesterday entitled “Harnessing IT for Energy.” Organized by the Washington Technology Industry Association (WTIA), the goal of the Seattle event was to stimulate discussion about the strengths of Washington state in software and energy distribution, and how they can be used to further innovation in cleantech. “We felt there was a huge opportunity for our state to become a leader in the convergence of IT and energy,” said Ken Myer, the chief executive of WTIA, in his opening remarks.

There are certainly some serious opportunities to consider. McCann noted that the state’s allocation of federal stimulus funding for energy transmission is projected to come to $574 million for energy efficiency, with another $1.5 billion going to smart-grid technologies (figures quoted from Climate Solutions, a Northwest nonprofit). He also pointed to financial industry surveys (as recent as November) that indicate cleantech and life sciences have the “highest potential for stability and growth.”

“The big issue for me is, this whole opportunity is not lost on the rest of the world,” McCann said. “If we win here, the stakes are huge. They’re bigger than information technology. The energy industry is the biggest on the planet.”

With that, he turned the discussion over to a distinguished panel, made up of Randy Berry, managing director at Areva T&D, a French smart-grid firm with operations in Redmond, WA; Jim Kensok, vice president and chief information officer of Spokane, WA-based utility company Avista; Marc Cummings, director of public affairs at Battelle’s Pacific Northwest National Laboratory (PNNL) in Richland, WA; and Michael Butler, chairman and CEO of Cascadia Capital in Seattle. They hit on some key progress being made in energy efficiency and smart grid systems, as well as what Washington still needs to do to create a cleantech hub—all from the complementary viewpoints of technologists, utilities, policy, and finance.

Here are a few key takeaways from each panelist:

Randy Berry of Areva T&D, a computer scientist by training, clarified that a “smarter” grid means more efficient, reliable, and environmentally friendly energy transmission and management. The problem is no longer just getting electricity from A to B. “Flows are all changing—it’s any direction on the grid,” he said, in part because of the addition of renewable sources like wind and solar. “It requires a lot of technology.” Berry said he has challenged his team to be able to display in a control center, …Next Page »

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Some unexpected bright spots appeared in the outlook for mergers and acquisitions yesterday during a workshop for local executives, which was co-sponsored by Connect and the San Diego offices of the Allen Matkins law firm.

The overall M&A market is bleak. But John Stiska, who oversees venture lending for the San Diego office of Agility Capital, says the regional picture is not as bad as he would have expected. That’s because mid-market equity funds are still looking to buy “decent” companies. To Stiska, “decent” means stable, medium-size companies that generate between $15 million and $50 million in annual revenue, and which show positive earnings before accounting for interest, taxes, and other costs.

“In Southern California,” Stiska says, “that’s largely the defense contractors that have been developing new technologies for both military and commercial customers. We have a lot of them in Los Angeles, Orange and San Diego Counties. They have stable backlogs. They’ve done pretty well in the past couple of years.” Stiska says he’s encouraged because many mid-market equity funds, which raise their investment capital from big insurance and pension funds, still have lots of capital—typically $300 million to $800 million.

Stiska says he also was surprised because roughly half of the San Diego executives who attended the workshop indicated they’re not looking to sell their companies—they’re looking to buy another company.

Clark Libenson, a San Diego lawyer who specializes in mergers and acquisitions, told me the M&A program usually consists of presentations on how to prepare a company for sale. It’s one way that law firms discreetly market their services. But organizers wanted this workshop more closely tied to current market conditions, so presentations by Stiska and others showed how M&A activity has changed since the credit crunch essentially shut down financing in the second half of 2007—a full year before the credit crunch hit the rest of the market. Highlights from their presentations on the 2009 outlook include:

—Capital constraints will continue to limit M&A activity, but cash-constrained companies will likely sell divisions that are not central to their core business so they can raise cash and weather the storm.

—”Mergers of necessity” will likely emerge as a prevailing theme.

—Conditions point to a buyer’s market, with capital-rich companies acting as key consolidators—and beneficiaries. By some estimates, S&P 500 companies have an aggregate $630 billion in cash.

—Creative financing structures, private investments in public equities, and stock deals are likely to be more prevalent in M&A transactions.

—Companies unable to refinance their debt will be forced to consider such alternatives as restructuring, selling assets, or selling the company—with pre-arranged sales under bankruptcy becoming more popular.

—Mega deals have come to a dead stop since July 2007, but middle market transactions have continued, albeit at a slower pace—partly because they typically require a smaller percentage of debt financing. Since 1998, more than 90 percent of all M&A transactions have been under $500 million.

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Beaverton, OR-based Infinity Softworks, a mobile software firm, announced today it has closed a round of financing. The investors and amount of funding were not disclosed. Infinity makes Web-based software for doing calculations and creating reports on the iPhone, BlackBerry, and other devices.

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MoneyAisle, the online marketplace for banking products that we profiled shortly after its launch last June, said today that users have now put more than $100 million into certificates of deposit and high-yield savings accounts via the company’s reverse-auction system, in which banks submit competing bids for potential customers’ business. MoneyAisle CEO Mukesh Chatter said the company’s ability to reach the $100 million milestone in just a few months was in part a reflection of the economic downturn and consumers’ search for investments with less risk than the stock market. “Tripling our deposits from the previous quarter shows that consumers are looking to invest their money in a safe FDIC-insured growth account from a trusted source,” Chatter said in a statement.

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Microsoft’s long-rumored job cuts are now official: 5,000 employees will be losing their jobs. The Redmond, WA-based software giant (NASDAQ: MSFT) said today in its quarterly earnings report that it is eliminating those positions over the next 18 months, which amounts to almost six percent of its workforce of 90,000 employees.

About 1,400 people are losing their jobs today, the company said in a statement. The cuts span a range of departments, including R&D, marketing, sales, finance, legal, human resources, and information technology.

The cuts are tied directly to a decline in Microsoft’s business. The company reported a profit of $4.17 billion in the most recent quarter, an 11 percent drop from the same period a year ago. To compensate for that, Microsoft hopes the job cuts will reduce annual operating expenses by $1.5 billion and its capital spending in fiscal 2009 by $700 million.

“While we are not immune to the effects of the economy, I am confident in the strength of our product portfolio and soundness of our approach,” said Steve Ballmer, chief executive officer at Microsoft. “We will continue to manage expenses and invest in long-term opportunities to deliver value to customers and shareholders, and we will emerge an even stronger industry leader than we are today.”

While Ballmer said he was confident in the statement, the company didn’t go so far as to offer Wall Street a forecast for revenue or profits for the rest of 2009. Microsoft’s stock dropped 7 percent to $18.02 at 10 am Eastern time.

Microsoft plans to discuss the quarterly performance, and spending cuts, on a conference call with investors at 8 am Pacific/11 am Eastern.

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As expected, the economic downturn is hitting venture capital hard. The top challenge for Washington state VCs for the first quarter of 2009 will be the availability of capital—ahead of the national economy and overall market growth.

That’s according to the Washington Technology Industry Association’s Q1 2009 venture capital outlook survey. The quarterly survey tracks local VC firms’ indicators of deal quality, quantity, expected exits, and business metrics for their portfolio companies.

The outlook for deal flow and valuations is fairly bleak. No venture capitalists surveyed predicted growth in valuations would be similar with the last quarter in any stage of new investments. However, 44 percent of VCs did predict moderately better deal quality this quarter.

As for their portfolio companies, two-thirds of respondents predicted their companies’ revenue growth would be moderately or substantially worse than in the fourth quarter of 2008. And unlike last quarter, when most VCs predicted no major changes in hiring, 54 percent now predict a decrease of at least 10 percent. Lastly, no IPOs are expected this quarter, but one-third of the VCs surveyed predicted at least one of their portfolio companies would be acquired.

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For startup entrepreneurs who need less than $5 million in capital, the venture capital industry might as well not exist. The average U.S. venture capital fund has doubled in size since 2000 to over $200 million, according to Dow Jones/VentureOne. That means most venture partners see investments of under $5 million as a waste of their time, according to James Geshwiler, managing director of Lexington, MA-based CommonAngels. Only a gigantic return on such an investment would “move the needle,” or provide adequate returns, for such a large fund, Geshwiler points out.

And that’s what has created an opening for the angel capital phenomenon. As of 2008 there were 168 angel capital groups nationwide with more than 6,500 members, says Geshwiler, who ran a well-attended tutorial on the angel investing business at the last Web Innovators Group meeting in Cambridge on December 9. That’s up from about 20 groups when CommonAngels got started in 1998—and it doesn’t even count the thousands of non-affiliated angels. Most of them are wealthy individuals who are industry veterans or former entrepreneurs themselves, who like to invest relatively small amounts (usually on the order of $25,000 to $100,000), and want to be more involved in their portfolio companies than they would be if they simply became limited partners in venture funds.

Angel groups have helped to get hundreds of new ventures off the ground—including Xconomy, which is a CommonAngels portfolio company. These types of groups, like Tech Coast Angels in San Diego and the Alliance of Angels in Seattle, just to name a couple, work by assembling many individual investments to fill what Geshwiler calls the “funding gap” between the $500,000 and $5 million levels. Geshwiler tailored his overview of the angel industry for startup entrepreneurs working to launch small, pre-venture-funded startups, focusing on questions like how to approach angels, what sectors are most interesting to these investors, what levels of equity they usually expect in return for their investments. (Geshwiler has posted the PowerPoint deck from his presentation here.)

The “very nature of angel funding has changed tremendously” over the past 10 years, with the Internet having a big impact, Geshwiler says. Most individual investors “are not interested in letting the world know that they have money,” he says. But organizing into regional groups with their own websites has given angels a new way to filter proposals and function almost like mini-venture funds. (Xconomy’s other bureaus have seen a couple examples of this in action recently, with Redmond, WA-based Healionics collecting $2.6 million from a syndicate of angels in the Northwest, and San Diego-based MicroPower Appliance scoring an interesting round of financing from the Tech Coast Angels.)

Angels, like all other investors, have been hit hard by the financial crisis, with most seeing their personal portfolios shrink by 30 to 50 percent in the last year, Geshwiler says. But the good news, he points out, is that the risks involved in angel investing aren’t necessarily any higher than in the past—they’re just different. It may be harder these days for small, growing companies to obtain follow-on investments, but on the other hand, there’s less competitive risk as fewer companies enter each niche. That also makes its easier for small companies to attract and hold on to great employees.

“This is not our recession, it’s Wall Street’s recession,” Geshwiler says. “You guys [entrepreneurs] haven’t bought into the story that the economy is over. I wish we’d just get over all this hand-wringing.”

Angel investors are a good resource for many startup entrepreneurs because they’re typically future-oriented, backing companies that can reach exits in five to …Next Page »

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San Diego-based Ardea Biosciences announced today it has entered into a securities purchase agreement with institutional investors to raise about $30.6 million from the private placement of newly issued shares of its common stock. Ardea (NASDAQ: RDEA) is focused on the discovery and development of small-molecule drugs to treat HIV, gout, cancer, and inflammatory diseases.

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When I first met Bryce Baril in June, he was a winning contestant in Seattle LivePitch, an event in which local entrepreneurs pitch their startups in two minutes. For the past four months, Baril has been holed up with his company, MarketOutsider, quietly working away on a software prototype—a “robotic financial analyst” that could potentially change the way people keep track of news about companies and other entities that might affect their investment strategy.

Baril, a former senior software engineer at Seattle-based Whitepages.com, isn’t ready to talk about the details just yet, but here’s the basic idea. His software scours the Web daily for articles from financial news sites like Seeking Alpha and MarketWatch. It keeps track of which companies are getting more coverage than usual, and whether the news is generally positive or negative. As of this month, you can check out MarketOutsider’s daily summaries of which public companies are up or down at its Twitter account here.

But that’s just the beginning, says Baril. An eventual goal is to provide a service whereby users can track companies, people, and products—and relationships between all of them—on a daily basis (or more). An early demo of the technology shows a graph displaying the day-to-day sentiment in the media about a given company. Baril says the curve typically correlates with the stock price of a company. That means you could use his service as a rough guide for investing, or at least to notify you when there’s a spike in news about a company you’re interested in.

And who exactly should be interested in this, besides investors and analysts? “We’re trying to get it to everybody,” says Baril. Given the state of information overload today (who has time to read 10 news articles?), a service like MarketOutsider’s would seem to be pretty attractive. But it will also take some pretty sophisticated search and language-processing technology to make it accurate and reliable. That’s one of the aspects that Baril and fellow co-founder Colin Meyer are busy working on now.

According to their Twitter feed, Amazon (NASDAQ: AMZN) was up in the media as of late last week—no big surprise, given its cloud computing announcement, Jeff Bezos’s appearance on Oprah, and her endorsement of Amazon’s Kindle e-book reader. I’m guessing Microsoft (NASDAQ: MSFT) will be up today and tomorrow, as its professional developers conference is going on in Los Angeles, and the company is set to announce its own cloud computing product…

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“One banker says to the other—wait, what other banker?” says Tom Huseby. The Seattle venture capitalist and wireless guru slipped in a joke about the thinning ranks of financiers during his keynote talk at today’s second annual Mobile Northwest Conference. I had a chance to stop by and see this morning’s session at the convention center in downtown Seattle. Just a quick recap here.

Huseby, the co-founder of SeaPoint Ventures and chairman of several local mobile-company boards, spoke about deals, markets, and what he likes to focus on in the wireless space. But first, he addressed the economy. “Who thought we’d end up where early-stage venture capital would look like one of the safer investments?” he said. “It’s better because nobody expects to get any money out of it for a long time, that’s it! Venture funds are supposed to last 8-10 years. It’s a long investment cycle.”

“So the venture community is pretty good,” he continued, pointing out there’s still a large number of investments being made in startups. “Compression of market cycles is enormous. The real economy is going to lag, the markets aren’t.” When it comes to startups, he said, “Hope is diminished, no question…Venture capitalists are marginally connecting the dots, and now they don’t even see the next dot. But one thing hasn’t stopped at all, and it’s the great American startup machine. Barring restaurants, America starts a huge percentage of companies in the world. The miracle is a totally undeserved sense of self-confidence. We revere new wealth, and people who’ve started companies…We compete on how humble our origins are.”

Huseby went on to describe the big trends he’s seeing in the mobile sector—”superphones” like the iPhone that are connected to the Internet all the time, and “Superusers” who “walk around doing things [on the devices] we never thought they’d do.” Then there are “all-you-can-eat” data plans. “Mobile this year became embedded in everything. Everything is wireless. We all of a sudden can get viral with it. It didn’t used to be that way—not enough users had the right phones,” he said. “That to me is the big sea change.”

So what does he look for in new deals and companies? “‘Winner-take-all Switzerland’ plays,” he says. This is where a small company comes in and solves a problem that the big guys (the Samsungs and Verizons, say) are in a standoff over. So a small company—like a Tegic or a SnapIn Software (both bought by Nuance)—can enter as a neutral party and own the space, providing a simple but necessary technology to handle things like text messaging or customer support.

Huseby took the time to answer several questions from the audience. One was about what he thinks of new business models like mobile advertising, in the context of the economy. “The downturn is not good for anything. I don’t think people will spend more on their phones, or buy more games. They’re going to do less,” he says. “The key to mobile advertising is to get out of the ‘new stuff’ budget…You have to turn it into media, and remove all obstacles.”

Someone else asked for Huseby’s thoughts on Google’s Android phone. He joked that because of its high weight-to-surface-area ratio, it could do well in the annual Swedish phone-throwing contest (apparently there have been at least nine of these “international” events so far). “They overkilled on …Next Page »

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Here at Xconomy, there are a lot of mornings when we have to decide whether to publish a bunch of brief stories, or lump the related ones together into what we call “roundups” or trend stories. Today was a pretty clear roundup/trend day, as news piled up from several Boston-area websites that help customers manage their money and learn about investing. Taken together, the reports create the impression that investors and entrepreneurs see the Boston area as a good place to build a finance-related Web community.

First there’s EmergInvest, a Cambridge, MA, startup that was founded in 2007 and came out of stealth mode Tuesday at the TechCrunch50 conference in San Francisco. The company’s free website, which it calls “Yahoo Finance for the rest of the world,” helps investors research companies trading on more than 150 stock exchanges around the globe. The site supplies stock quotes, historical charts, news, and other data familiar to users of traditional finance sites—except that you probably won’t find a lot of data about companies in Kyrgyzstan on Yahoo Finance or Google Finance.

“It was such an obvious value proposition,” EmergInvest CEO Andrew Waterman said in a company statement released yesterday. “Investors wanted access to high-growth markets to diversify their portfolios, and thousands of international companies were yearning for investment. Why wouldn’t we connect them?” In addition to providing information about international stocks, EmergInvest’s site can steer users toward local English-speaking brokerages where they can actually invest, or toward mutual funds or exchange-traded funds that include those stocks.

For people who are interested in the investment process but may not be ready to pony up their own money, there’s another Cambridge-based company called UpDown that runs the financial world’s equivalent of fantasy football. As I explained in a profile of UpDown last year, the free site gives members $1 million in virtual money to invest in a portfolio of real companies. Members earn real cash rewards when their virtual portfolios outperform the market, when their stock analyses are voted most valuable by other members, or when the members they’ve referred to UpDown earn their own rewards. And in an interesting twist, UpDown hopes to make money itself by monitoring which virtual investment decisions by members are paying off most handsomely and using that data to manage its own real investment fund.

UpDown co-founder and CEO Michael Reich sent word this week that the company has recruited more than 75,000 members since its launch last September, and that it has raised another $1 million in funding from its primary backer, Swiss angel investor Joachim Schoss. “The growth we’ve seen in the last 12 months has definitively surpassed our ambitious expectations,” Reich says. “We’re excited about our growth especially since it occurred in a tough environment—the stock market has been extremely volatile in the last year—but maybe that even helped us as members can practice their skills in a risk-free environment and not risk their real money.”

Reich says the company will use the new funds to improve the site and acquire more members. “We also expect to see revenues grow, and we’re aiming at becoming cash flow positive by the end of next year,” he says.

Finally, we heard today from Pete Glyman, co-founder of Geezeo, the personal finance tracking site that we first profiled in August 2007. Glyman said that Geezeo, which got its start in Framingham, MA, and is now based in Hartford, CT, has just expanded to include a new “Marketplace” section—essentially, a comparison-shopping area for credit cards, savings accounts, CDs, and student loans. The information includes not just raw data—the interest rates charged by various banks for their versions of American Express or Visa cards, for example—but also customer ratings and reviews. In the near future, the Geezeo Marketplace will also cover mortgages, auto loans, and brokerage accounts, Glyman says.

“Many people make their most important financial decisions, like which credit cards and bank accounts to use, with very little information and a great deal of uncertainty,” the company explained in a statement today. “The Marketplace will eliminate this uncertainty by simultaneously demonstrating the hard facts of a product as well as reveal[ing] what customers think of a specific product. Our users rate their financial products and provide feedback based on integrity, customer service, and other intangibles not found in a prospectus.”

Along with the new marketplace, Geezeo rolled out a new design for its entire website, including improved charts and graphs that members can use to track their progress toward financial goals. The redesigned site is also more clearly integrated with investment news site TheStreet.com, which made a strategic investment in Geezeo back in April and has the option, under the investment agreement, to purchase the company.

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