The state of Massachusetts has pledged to pump $1 million over the next four years into MassChallenge, the Boston-based nonprofit announced today. MassChallenge, which awarded $1 million across 16 startups in its inaugural startup competition last year, opened up its 2011 program today, with an application deadline of April 11. Greg caught up with MassChallenge CEO and co-founder John Harthorne earlier this year when he was ramping up fundraising efforts for the program and expected no state contributions at that time. MassChallenge also announced today that it has received additional contributions from new and existing supporters and will maintain its Seaport District office space through 2014, thanks to an extended agreement with the Fallon Management Company and MassMutual.

Comments | Reprints | Share:          

There’s probably nary a Web entrepreneur who hasn’t had a forehead-slapping “Why didn’t I build Groupon?” moment at some point in 2010. Well, I had an experience like that this week, reading Devin Friedman’s superb article “The Viral Me” in the December issue of GQ. It’s all about the Y Combinator venture incubator in Mountain View, CA, and the peculiar species of brash, young, hyper-optimistic entrepreneurs who build companies there. Given that I know most of the startup founders Friedman talked with—heck, I’ve profiled a bunch of their companies—I’d like to think I could have written a piece that good.

I urge you to read it for yourself. But it’s even longer than most of my articles, so I’ll summarize the point that I thought was most perceptive. It was about friction. The entrepreneurs Friedman hung out with, such as DailyBooth CEO Brian Pokorny, talked about how they strive to build Web services that are frictionless—that is, very easy to join and use—or that even have a kind of negative friction, so that it becomes harder to not use them than to just give in (e.g. Facebook).

Friedman dutifully lists the merits of frictionlessness, but toward the end of the piece he cleverly turns the idea around. He suggests that most young Silicon Valley entrepreneurs seem so happy about what they’re doing precisely because of friction: they’ve been given the resources to build stuff, “and the act of creation is maybe the most frictive thing going.” From this point of view, you need a certain amount of difficulty to keep life interesting; otherwise, nothing would be a challenge.

(As a quick side point, there may actually be a benefit to preserving friction on the Web, too. Andres Glusman, vice president of strategy at New York-based Meetup, told me recently that his company actually saw an increase in usage after it added a checkbox to its group creation page saying “I pledge to create real, face-to-face community.” The added step seemed to cause users to slow down and think about why they really wanted to use Meetup in the first place.)

Now, what happens if you take this idea of friction up one level, from the things technology entrepreneurs build to the environments they’re building in? I’ve asserted in this column before that the geography isn’t such a big issue anymore for startups, since cash, talent, and the other resources fueling innovation are increasingly liquid. And I still think that’s the direction things are going. But by my argument, you’d be able to build a tech startup in Fargo, ND, just as easily as you can in Mountain View—which clearly isn’t yet the case.

From Friedman’s point of view, the only way to make Fargo as attractive as Mountain View—the only way to massively scale up Silicon Valley, in other words—would be to remove all friction from entrepreneurship. But not only is this impossible, it would defeat the whole point of being an entrepreneur. You need some friction to keep things interesting, and to weed out the bad ideas. The question is how much.

And that’s the point I want to riff on today. Because Xconomy observes key innovation hubs so closely, we’ve got a fair amount of data, at least of an anecdotal sort, about what’s working for technology entrepreneurs and what isn’t. My own sense is that in New England, where Xconomy was born, startup founders encounter too much friction. In Silicon Valley, by contrast, they probably encounter too little.

Let me expand on both points. I spent three years covering the innovation scene in Boston before moving to San Francisco last summer. So I know there’s an ongoing discussion among entrepreneurs, investors, and government officials about how to strengthen the ecosystem supporting Massachusetts technology startups and how to keep young entrepreneurs from fleeing to Silicon Valley. There have been positive developments—for example, the MassChallenge startup competition, the opening of Kendall Square’s Venture Cafe as a community hub, and the Boston Regional Entrepreneurship Week effort (which actually spread across most of October). But these changes haven’t plugged the startup leak.

The latest case is RelayRides, a car-sharing service that was born earlier this year in Cambridge, MA, and won the $50,000 grand prize in the MassChallenge competition in October. The startup revealed this week that it’s moving to San Francisco, having secured an undisclosed amount of … Next Page »

Comments (5) | Reprints | Share:          

It’s been more than two years since Massachusetts Gov. Deval Patrick signed the bill for the state’s plan to invest $1 billion in its life sciences sector over a 10-year period. Susan Windham-Bannister, who started work as chief executive of the quasi-public Massachusetts Life Sciences Center around the time the bill was signed, has since been in charge of the massive initiative.

To get a read on how things are going at the Life Sciences Center, and to hear Windham-Bannister’s take on major developments at Cambridge, MA-based Genzyme (NASDAQ:GENZ) and other nooks of the state’s life sciences sector, I wandered around the Waltham, MA office park where she and center are based until two maintenance guys pointed me in the right direction. (It was a good thing, as I almost dropped in on my friends at the venture firm Advanced Technology Ventures in the same building to ask for directions. If you wonder why “Dr. Sue” set up shop here, read this piece from our Xconomy archives.)

So far, the $1 billion plan appears to be moving along nicely despite some cuts to its annual budget for its investment fund on Beacon Hill. In the program’s first two years, a total of $191 million dollars has been awarded through several programs to support the life sciences sector in the state. Those dollars have been invested alongside $710 million from companies, the National Institutes of Health, private investors, and other sources of external funding. Noting the impact of those dollars and her center’s, Windham-Bannister likes to say that her organization has already come close to reaching its magic number of $1 billion in investments in life sciences.

In pure state funding, the center has distributed the majority of its dollars to capital projects in the life sciences sector. For example, the town of Framingham got a $12.9 million grant from the center to for work on a wastewater facility, which is needed to support Genzyme’s $300 million project to build a new biotech drug plant there. The company also got $6 million in tax incentives last year to create 200 jobs in Framingham during 2010.

The center is also courting global life sciences companies to match its investments in startups. To date, the French drug giant Sanofi-Aventis (NYSE:SNY) and New Jersey-based health products powerhouse Johnson & Johnson (NYSE:JNJ) have each agreed to contribute at least … Next Page »

Comments | Reprints | Share:          

When most people think of the New England tech startup scene, they probably don’t think of a bunch of women. Like most places I’ve visited or lived in, the Boston technology community tends to feel pretty male-dominated. But that might be changing fast.

As my colleague Bruce reported today, a CB Insights demographic survey of startups shows that, among other things, Massachusetts has a much higher proportion of female founders (27 percent) than California (6 percent), New York (7 percent) or the national average (8 percent); and nearly one-third of Massachusetts startups surveyed have all-female founding teams (31 percent).

The survey was based on 165 Internet startups nationwide that received early-stage venture capital during the first half of 2010. (CB Insights is a New York-based data services company that tracks startups and investments, and it explains its survey methodology here.)

It’s not a big sample—and it’s the first time this particular survey has been done—so the results might be a statistical anomaly. But they’re pretty surprising nonetheless. And they led me to seek out a few people in the Web startup community for their reactions.

“I’m as baffled as you. It doesn’t feel that way,” says Jules Pieri, founder and CEO of Daily Grommet, an e-commerce startup based in Lexington, MA, referring to the 27 percent figure for Massachusetts (see chart below). “The environment has a lot to do with it. There has been a huge increase in visibility and connections between female founders…I think having role models is the most central explanation.”

Pieri also notes that the academic environment around Boston might be “a little more egalitarian,” and that it “probably helps retain women who go on to found companies.”

.

.

.

Others, like Bettina Hein, the founder of Cambridge, MA-based video startup Pixability, are particularly careful about not reading too much into a one-time survey. But, Hein says, if the data hold up over time, she has some speculative reasons for the higher proportion of female founders … Next Page »

Comments (8) | Reprints | Share:          

38 Studios, the video game company founded by former Red Sox pitcher Curt Schilling, is considering moving its Maynard, MA, headquarters to Rhode Island, the Associated Press reported. The company is set to meet on Thursday with the Rhode Island Economic Development Corporation, to discuss a proposal offering up to $75 million in loan guarantees to 38 Studios if it moves its operations to the state. Schilling has previously called for Massachusetts to offer greater financial incentives, such as tax credits, grants, and subsidized office space, to better attract and keep video game companies in the Bay State. 38 Studios CEO Jennifer MacLean couldn’t be reached when I published this news brief, but I’ll update the story if I hear back from her.

Comments | Reprints | Share:          

If you don’t know where you started from, it’s harder to figure out where you’re going. That’s why we chose to kick off this week’s special video travelogue series, World Wide Wade Goes West, in a place that’s as East Coast as they come: the historic seaport of Gloucester, MA.

While Gloucester is famous for its fleets of fishing boats, one of the city’s most unique products has nothing to do with seafood. It’s pipe organs. At the workshop of C.B. Fisk, craftsmen have been hand-building organs since 1961, including the organ at Stanford University’s Memorial Church and another instrument that’s in progress for Harvard University’s identically named Memorial Church.

At Fisk, I got a fascinating tour from Mark Nelson, who helps design and maintain many of Fisk’s instruments and is also the company’s webmaster. For our video (below, and here on YouTube), I asked Nelson what role modern digital technologies play in the venerable craft of organ-building—and in his own life.

For the whole story behind these videos, watch the pilot/preview episode, which we posted a couple of weeks ago. In the episodes coming later this week—which I’m shooting and editing on the way to San Francisco with help from my friend, the photographer, author, and composer Graham Gordon Ramsay—we’ll be checking in with people in places like upstate New York, northern Michigan, suburban Minneapolis, rural South Dakota, and Denver. Watch for new video posts every day here at www.xconomy.com/san-francisco or subscribe to the World Wide Wade Goes West YouTube channel at youtube.com/xconomywest.

World Wide Wade Goes West is sponsored by Pixability.

Comments (1) | Reprints | Share:          

Google unveiled the results of its first state-by-state analysis of the company’s impact on regional economies at press events in 10 cities on Tuesday, including Cambridge, MA, Detroit, and Seattle. For the most part, Google measured the value it generates when local advertisers and Web publishers use its AdWords and AdSense platforms for Web advertising.

Overall, Google claimed that transactions enabled by its search and advertising tools added up to $54 billion across the United States in 2009. About one-fourth of that that activity, $14.13 billion, took place in California. New York felt the second-biggest Google impact, with $6.27 billion in advertising-driven activity, followed by Illinois at $3.24 billion and Texas at $3.18 billion. Xconomy’s other home states of Massachusetts, Michigan, and Washington saw total economic value of $2.2 billion, $906 million, and $2.8 billion, respectively.

“‘What is the value of Google to local businesses?’ is a question we’ve often heard from the press, from advertisers, and from partners,” said Brian Schmidt, director of sales for Google Boston, at a press conference Tuesday at the Pemberton Farms market and garden center in Cambridge. “We take it seriously and we wanted to put some serious thought behind it.”

Advertising on Google is a “growth engine” for local businesses, Schmidt argued. He said that 43,000 of the 175,000 businesses in Massachusetts have advertised on Google. That includes Pemberton Farms, which allocates about 60 percent of its overall advertising budget to buying online ads matched to search keywords such as “gift basket” and “fruit basket,” according to co-owner Mark Saidnawey.

“The actual economic return to the state [of Massachusetts] via our advertising programs totals over $2 billion for 2009 alone. That is a really big number,” Schmidt said. “What’s important to note here is that we are not a California company. We are headquartered in Silicon Valley and that’s our focus, but we’ve built a focus in Massachusetts that we’re proud of. We’ve hired over 200 people, but more importantly we are empowering businesses in Massachusetts.”

Google calculated its economic-impact numbers by assuming that the dollars advertisers spend buying keyword-based advertising on its search pages through the AdWords program have a multiplier effect on their businesses. (After all, the whole point of advertising on Google is to entice Web surfers to click on your ad, arrive at your website, and become customers.) Hal Varian, Google’s chief economist, says businesses earn an average of $2 for every $1 that they spend on AdWords ads.

But when Google factors in not just revenue from AdWords advertising but revenue from clicks on natural search results—which outnumber AdWords clicks by about 5 to 1, acccording to third-party researchers—the multiplier effect grows even larger. Overall, the company calculates that for every dollar AdWords advertisers spend, they get back about eight dollars. (The exact formula that Google used can be seen here in more detail.)

A number of state and local officials attended the Cambridge press event, including Greg Bialecki, Secretary of the Executive Office of Housing and Economic Development under Massachusetts Governor Deval Patrick. In interviews with Xconomy and elsewhere, Bialecki has often promoted high-tech innovation as a path to economic recovery and growth for the state. “When we talk about the ‘innovation economy,’ sometimes people say ‘It sounds like you’re helping high-tech businesses but not … Next Page »

Comments (2) | Reprints | Share:          

Prominent Massachusetts venture firms and CEOs have formally rolled out a mentoring program aimed at supporting “a new generation of technology entrepreneurs” in the state, in the words of an announcement this morning. Called 12×12, the initiative is supported by 12 local CEOs and 12 venture capital partners, and will match entrepreneurs with advisors for hands-on help launching 12 new companies. Michael Greeley, founder and general partner at Flybridge Capital Partners, debuted the idea (which was originally called “12 by 12 by 12 by 12 by 12″) in post for us in June 2009.

According to today’s announcement, which was issued at the Nantucket Conference on Nantucket Island, the participating executives are Colin Angle of iRobot, Jim Baum of Netezza, Jeff Bennett of NameMedia, Joe Chung of Allurent, Helen Greiner of CyPhy Works, Brian Halligan of HubSpot, Tim Healy of EnerNOC, Diane Hessan of Communispace, Scott Savitz of ShoeBuy.com, Brian Shin of Visible Measures, Ram Sudireddy of CHiL Semiconductor, and Michael Weintraub of Humedica.

The venture partners involved are Jon Auerbach, general partner at Charles River Ventures; Liam Donohue, general partner at .406 Ventures; Scott Friend, managing director at Bain Capital Ventures; Jamie Goldstein, general partner at North Bridge Venture Partners; Felda Hardymon, partner at Bessemer Venture Partners; Matt Harris, managing general partner at Village Ventures; Mike Hirshland, general partner at Polaris Venture Partners; Eric Hjerpe, partner at Kepha Partners; Bob Hower, general partner at Advanced Technology Ventures; Paul Maeder, general partner at Highland Capital Partners; Eric Paley, managing partner at Founder Collective; and Carl Stjernfeldt, general partner at Castile Ventures.

Comments (1) | Reprints | Share:          

The Patrick Administration announced today that representatives of the Massachusetts: It’s All Here campaign to support business growth in the state will be available for meetings with college students, entrepreneurs, and small business executives at their new location in the Cambridge Innovation Center at One Broadway, Cambridge. Officials who will be available by appointment for office hours at the CIC include Gregory Bialecki, Secretary of Housing and Economic Development; Eric Nakajima, Senior Innovation Policy Advisor; Anne Struthers, Executive Director of Business Development; and Kofi Jones, coordinator of Massachusetts: It’s All Here. Xconomy broke the news about the opening of the state’s CIC outpost in early February.

Comments | Reprints | Share:          

Michigan is beginning to take a more enlightened approach to economic development, with a stronger level of cooperation between academia, industry and government. It is now recognized that each of these constituencies has a vital role to play in rebuilding and sustaining a robust, knowledge-based economic model.

Mr. Lennart Johansson, the Swedish Consul General to Michigan, articulated the concept well in a recent discussion that I had with him. In Sweden this cooperative approach is called the “Triple Helix Model.” The objective is to create a systematic approach to encouraging and nurturing innovation, one that will ultimately result in economic growth. The model is based on strong interactions between Sweden’s universities, industries, and government. The idea is to move from being solely focused on the production of tangible goods to an economy that is based on the capitalization of knowledge.

I believe that there is a wealth of knowledge to build on in Michigan. Our universities and our companies have long histories of developing deep knowledge in advanced technologies and processes. We also have a very active community of innovators and entrepreneurs. What is needed now is a way to further accelerate the incubation and commercialization of these solutions. I think Michigan has taken some positive steps in a number of areas, but due to the severe negative economic impact that the automotive industry’s troubles have had on the state, much more needs to be done.

I have had the opportunity to work with a number of investor groups and startup companies in various parts of the United States, and around the world, over the past several years. Let me share some of what I have learned.

I have had numerous discussions regarding what it is like to “do business in Michigan.” We need to work hard to ensure that Michigan is perceived as a “good place to do business.” This means that we should actively promote business practices and public policy that encourage businesses to locate here, and prosper as a result. We need to ensure that the government is seen as an enabler in the process, not an impediment. And we need to understand the value that Michigan can bring to helping the companies achieve their objectives.

Some of the areas of value that are well recognized are Michigan’s strong engineering base, deep knowledge in manufacturing process technology, and highly developed logistics infrastructure. All of these qualities are in demand in with new technology startup companies. I have a number of projects with companies and universities in the Boston area, where there is a high level of new technology development, but limited ability to bring the technology to production. Maybe a Massachusetts-Michigan partnership program would be in order.

The other observation that I would share comes from my work with Michigan-based start-ups. Access to early stage funding usually requires that the companies spend a lot of time in other states to find investors. We need to actively promote venture capital interest in Michigan startup companies. It would be nice, if at least some of the time, the money were looking for the opportunity, instead of the other way around.

[Editor's note: To help launch Xconomy Detroit, we've queried our network of Xconomists and other innovation leaders around the country for their list of the most important things that entrepreneurs and innovators in Michigan can do to reinvigorate their regional economy.]

Comments | Reprints | Share:          

Energy is a $6 trillion global industry, and will likely grow to more than $10 trillion by mid-century. As clean energy replaces carbon-based energy sources around the world, new markets employing millions of people will emerge.  Countries like China recognize this opportunity, and are racing decisively ahead. Meanwhile, the United States’ inaction is relegating our country to the back of the pack.

Passing a climate bill this session that establishes a price on carbon will send a critical price signal to the private sector. It will unleash a torrent of investment in new technologies, create countless new ventures, and catalyze the innovation required for the U.S. to gain a leadership position. Massachusetts is well positioned to be a “disproportionate beneficiary,” enjoying more job creation and economic prosperity from this revolution than any state save California. The Commonwealth received over $350 million in cleantech venture investment in 2009 (second only to California), and will receive a great deal more in the years to come if investors are provided with the market certainty that a price on carbon provides.

The benefits of passing strong energy & climate legislation this session are substantive:

• A climate & energy bill will create thousands of jobs in Massachusetts. Clean energy is already the state’s fastest growing industrial sector with nearly 2000 companies and over 26,000 jobs. Separate studies by UMass Amherst and UC Berkeley show that a federal low-carbon policy could create up to 40 thousand jobs in Massachusetts and increase the State’s real Gross Domestic Product by up to $2.8 billion between now and 2020.
• Clean energy investments create 16.7 jobs for every $1 million in spending. Fossil fuels, by contrast, generate only 5.3 jobs per $1 million in spending. Clean-energy investments create 2.6 times more jobs for people with college degrees or above, 3 times more jobs for people with some college, and 3.6 times more jobs for people with high school degrees or less.
• A climate & energy bill will give investors the market signals and long-term certainty they need to commit additional dollars to the sector. Under a federal low-carbon policy, Massachusetts could see a net increase of about $3.5 billion in investment revenue.
• Comprehensive climate and energy legislation will save money for consumers. Massachusetts’ experience under the Regional Greenhouse Gas Initiative (RGGI) shows that Massachusetts electricity prices declined from 18¢/kWh at the start of the program in January 2009 to 16¢/kWh in November 2009.
• Strict limits on carbon emissions will improve our competitive standing with respect to the rest of the world.  A recent report from the Pew Charitable Trust finds that  China, Brazil, the United Kingdom, Germany and Spain—all with strong, national policies aimed at reducing global warming pollution and incentivizing the use of renewable energy—are establishing strong, defensible positions in the clean energy economy. Unless our country makes a significant, long-term commitment to this sector, we may find ourselves out of the running.

What’s at stake here is no less than America’s global competitiveness, and we are already being lapped. Today, the U.S. is home to only one of the top five wind turbine manufacturers, one of the ten largest solar panel producers, and two of the top ten advanced battery manufacturers. China is now the largest wind turbine manufacturer, the largest solar panel manufacturer, and a dominant market player in advanced vehicle and battery technology.

Each day we wait, we fall further behind, sacrificing economic growth and badly needed jobs here at home. And that will not change until Congress passes a strong energy/climate bill.

Senator Lindsey Graham (R-SC), who is working with Senators John Kerry (D-MA) and Joe Lieberman (I-CT) to craft compromise energy and climate legislation in the Senate, recently noted: “Six months ago my biggest worry was that an emissions deal would make American business less competitive compared to China. Now my concern is that every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy.”

The 1900s were labeled “The American Century.” Unless we act now to enter our bid for market leadership in the world’s largest industry, we run the very real risk that the twenty-first century will have China’s name written all over it.

It’s time for the Senate to get our country out of the starting blocks and into the clean energy race.

Comments (2) | Reprints | Share:          

Jason Schupbach, the first state official in the country tasked with promoting the “creative economy,” will be leaving his position with the Massachusetts Office of Business Development effective May 5 to become director of design at the National Endowment for Arts in Washington, D.C., the NEA announced today. Schupbach’s role at the endowment will be to administer grants to the design sector and design initiatives such as the proposed $5 million “Our Town” project, which will explore the role of the arts in economic revitalization and community improvement. “Jason has set a national standard here in Massachusetts for connecting the various and diverse sectors of the creative economy to the public and academic agencies throughout the state,” Massachusetts Secretary of Housing and Economic Development Greg Bialecki said in a statement. “He has been a critical resource for innovation and collaboration for the Commonwealth, and I’m certain he will offer the same to the NEA.” Last fall Xconomy profiled Schupbach and his efforts to boost Massachusetts business sectors such as advertising, architecture, design, digital media, film, gaming, marketing, music, publishing, tourism, and the arts, which collectively employ more than 100,000 people in the Bay State. “This was a bit of an unexpected opportunity, and I’m very excited about the possibilities it holds,” Schupbach said in an e-mail.

Comments | Reprints | Share:          

The state of Massachusetts has contracted with Boston-based EnerNOC (NASDAQ: ENOC) to employ its energy-tracking software systems to monitor 17 million square feet of state-owned facilities, using federal stimulus dollars set aside for energy investments, Governor Deval Patrick’s office announced today. The state has put $10 million toward what it calls the Enterprise Energy Management System project, which would use EnerNOC’s technology in its initial three-year phase to track real-time energy usage and target inefficiencies in 470 state buildings. The project is expected to add about 46 jobs in the state starting next month, and could save more than $10 million annually in energy costs once a planned second phase of the project is complete, the governor’s office said.

Comments | Reprints | Share:          

Massachusetts Governor Deval Patrick announced today that the state will provide up to $25 million to further construction of the Holyoke High Performance Computing Center, a project designed to advance green computing and boost business in western Massachusetts. Patrick also designated the Holyoke area as an innovation district, and said that the computing center, which will foster research in life sciences, energy, and green computing, will get another $40 million from a consortium of universities.

Comments | Reprints | Share:          

On March 2, I reported to Suffolk County Superior Court for jury duty, certain that I’d be let go after my day of service or excused, just like every other time. So it was a bit of a shock to find myself seated, by the end of the day, as Juror No. 14 on a medical malpractice trial that, according to the judge’s prediction, would take until March 23. (She was exactly right, as it turned out.)

I won’t dwell here on the irony of being forced to spend most of Mass Mobile Month immobile in the jury box, separated from my laptop and unable to use my cell phone. Being part of the 14-member jury on a three-week civil trial was no more of a hardship for me than it was for the other jurors, so I’m not going to complain. But I do want to share a few observations from the experience—some encouraging, some not. I’ll try to restrict myself mainly to talking about subjects related to technology and medicine, which were the big themes in the case.

The trial, in a nutshell, was about a health emergency that went undiagnosed far too long. The plaintiffs were an elderly church pastor from a Boston suburb and his wife. (I’m not going to use their names.) The pastor had a history of back trouble, but nothing incapacitating. The weekend before Thanksgiving in 2003, he began to experience unbearable back pain, and was taken to the ER of a local hospital (which I also will not name—if you want to go dig up the details, I’m sure there are public records).

Doctors there quickly determined that the pastor had a streptococcal infection in his bloodstream and started him on the appropriate antibiotics. They began a series of tests intended to locate the source of the infection and the pain. But the agony continued, and it wasn’t until five days later, after the pastor had been transferred to a prominent Boston hospital, that its true source was discovered.

An imaging study showed that the infection had taken root in the pastor’s spine in the form of a large epidural abscess, a pocket of pus inside the spinal canal between the bone and the dura, the outer lining of the spinal cord. As soon as the abscess was detected, surgeons operated to drain the pus. But by then it was too late. The abscess had pinched off the pastor’s spinal cord, causing permanent nerve damage. The pastor, now 75 years old, can’t walk on his own and suffers from a range of other disabilities.

The plaintiffs’ attorney was an outstanding Boston trial lawyer and medical malpractice specialist named Gregg Pasquale, of Keches Law Group. I’ve since learned that in the 1980s Pasquale was an assistant district attorney in Middlesex County, where he prosecuted murder cases. His fiery zeal was evident every day in our courtroom. Pasquale argued that the defendants in the case—a radiologist from the suburban hospital and two doctors from the Boston hospital—should have done more to diagnose the pastor’s problem.

One of the many difficulties in the pastor’s case was that the abscess didn’t appear on the standard MRI exam ordered by the ER doctor at the suburban hospital. But Pasquale argued that … Next Page »

Comments (6) | Reprints | Share:          

The largest gaming expo on the East Coast, this weekend’s PAX East festival, will be preceded by what’s likely to be the biggest party the Boston gaming scene has ever witnessed, tonight at Microsoft’s New England R&D Center in Cambridge, MA.

A packed house of 800 guests is expected at the PAX East “Made in MA” bash, organized by the Mass Technology Leadership Council (MassTLC) and sponsored by AMD and Microsoft. The event is intended to celebrate the $2 billion cluster of companies in the video game and online game industry in Massachusetts. Many of these companies will be exhibiting at PAX East (but some won’t—and therein lies another story).

PAX East itself, the first PAX event outside of the conference’s home city of Seattle, is expected to attract a sold-out crowd of 60,000 gamers to the Hynes Convention Center in Boston. Local officials are hailing the consumer-oriented expo—the creation of Seattle-based Penny Arcade, whose online comic books, forums, and videos have a big following in the gaming community—as a confirmation that the Boston area is home to a critical mass of both game players and game builders.

“It’s huge for us,” says Jason Schupbach, creative economy industry director for the Massachusetts Office of Business Development, a wing of the state government’s Executive Office of Housing and Economic Development. “This will be the biggest gaming conference on the East Coast, and it’s a nice affirmation of what’s already going on here, and of the work the local gaming industry has done to build their community over the past 10 years.”

As part of an initiative Schubpach helped organize, all of the Massachusetts-based companies exhibiting at PAX East will have special “Made in MA” stickers on their booths. And there’s a plan for representatives of local gaming companies to wear “I Work in Massachusetts” pins to the event.

But as large as it will be, the expo won’t be all-inclusive. Some local gaming companies are shying away from the event, out of concern that small- to medium-sized local developers will be drowned out on the exhibit floor by the free-spending giants of the industry, such as Electronic Arts and Take-Two Interactive, maker of the Grand Theft Auto series.

Foxborough, MA-based Quick Hit, for example, considered exhibiting at PAX East but ultimately decided against the idea. Last fall the company launched an online football game incorporating elements of role-playing and strategy games, such as the ability to assemble teams of players based on real-life football stars. To attract crowds to its booth, Quick Hit wanted to bring in ex-NFL athletes and coaches for product signings, according to Samantha Smith, the startup’s director of communications. But there was a flag on the play.

“When you have companies like Electronic Arts and Harmonix and Take-Two exhibiting, we felt we needed something big to stand out and draw the crowd appeal, but that was really frowned upon by the PAX staff,” Smith says. “They felt that PAX is really about … Next Page »

Comments (4) | Reprints | Share:          

Massachusetts is going to be the focus of the health IT universe late next month — if it isn’t already. Governor Deval Patrick and his staff have invited power players in both the healthcare and technology fields to Boston in April for a conference that is expected to highlight the state’s fast-growing health IT sector.

The conclave comes as state organizations in Massachusetts and other parts of the U.S. begin spending more than $1 billon awarded to them by the federal government since February for regional and statewide systems for sharing electronic health records. To headline the conference, the governor has attracted at least two of the top federal officials involved in national health IT initiatives: Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, and David Blumenthal, the national coordinator for health information technology. The conference is slated for April 29-30 at the Westin Boston Waterfront hotel in South Boston.

Several factors are playing into Patrick’s strategy for bringing these and other heavy hitters to the state, according to people involved with the conference. Massachusetts has a huge stake in President Obama’s plan to invest $19.5 billion from the federal economic stimulus passed last year to drive adoption of health information technology over the next several years; a bright spot in the mostly stormy economy in recent years has been the growth of tech companies such as Athenahealth, eClinicalWorks, and Meditech that provide software and services to hospitals and other healthcare organizations. These Bay State firms are competing with companies around the world for their share of the billions of dollars in new business that will be generated by Obama’s health IT initiative, which is expected to create jobs while reducing healthcare costs and improving patient care.

Bay State officials have invited state health IT and Medicaid leaders from around the country, as well as healthcare software firms from Massachusetts, to the conference. To help ensure their participation at the conference, the plan is to pay for the travel expenses of … Next Page »

Comments (1) | Reprints | Share:          

Earlier this month, we wrote about some of the mammoth venture deals that helped add up to $355 million worth of investments in Massachusetts startups in January. But don’t think we’ve forgotten about the little guys.

These are what we call our under-the-radar deals, typically worth between $100,000 and $1 million (though the January list contains a deal smaller than that). Those numbers, tracked by New York-based private company intelligence platform CB Insights, are in now, and we think they have a lot to tell us about what’s going on in the innovation scene.

We look at both equity and debt forms of financing on this list, and see their smaller dollar values as valuable indicators of the New England startup landscape. The reports often tell us which new companies are about to emerge out of stealth mode or spin out a new product, and frequently these end up being companies we highlight in bigger stories later on down the line.

There were 13 of these financings in the month of January, with eight in equity, four in debt-based funding, and one that represents a security to be acquired through the exercise of option or warrants, according to the SEC filing. Software and cleantech companies showed up prominently on the list.

December saw a higher number of under-the-radar financings (21), but January had some bigger-sized deals than the month before it. There were three million-dollar financings on January’s list, with $1 million in debt to security software company eIQnetworks, $1 million in equity to DNA mapping company U.S. Genomics, and another $1 million in equity to Green Earth Technologies, developers of biodegradable patent-pending motor oil, as well as other home and lawn products.

As usual, Massachusetts took the biggest share of these deals, at 10. Connecticut pulled in two such deals, and New Hampshire had … Next Page »

Comments | Reprints | Share:          

I stopped by the Cambridge Innovation Center this afternoon to welcome a special newcomer to the neighborhood (Xconomy’s headquarters is just three blocks away). It was Jason Schupbach, the creative economy director for the Massachusetts Office of Business Development.

Schupbach—who is already a familiar face around the local innovation community, of course—is in the vanguard of a group of people from the MOBD and other parts of the state’s Executive Office of Housing and Economic Development who are venturing across the Charles. They’ll be spending part of each week working from a suite that EOHED is renting on the 11th floor of the massive startup beehive.

The agency’s main offices will remain in their current location in downtown Boston, but Schupbach and other officials—including Housing and Economic Development secretary Greg Bialecki—will hold office hours in the CIC space for up to two days a week.

The office will also provide at least a part-time home to personnel for Massachusetts: It’s All Here, a public-private partnership between MOBD, MassEcon, MassDevelopment, and the Massachusetts International Trade Council. Through its website www.massitsallhere.com, which was unveiled last fall, the group is campaigning to promote business growth and employment in the state.

Bialecki’s office is expected to announce more details about the office opening soon.

The reasoning behind the move is simple, according to Schupbach. “This is where many of the great future companies are coming out of,” he says. “This is where a lot of the entrepreneurial action is.”

Comments | Reprints | Share:          

If the NSA monitored communications in Massachusetts, their analysts might raise an alert. With the baseball season over, there has been an anomalous amount of chatter using baseball terms as code for something.

They would trace the threat to Bill Warner, Avid founder and long time innovation activist. Bill has recently published a manifesto on his blog setting the bar for the rest of us. Declaring that we have too many singles and doubles, and not enough home runs, Bill is proposing we adopt a new nomenclature in our innovation economy. Here is Bill Warner’s proposed scorecard:

Single

Any growing company that is selling a successful product. This would mean any company that successfully reaches the market and serves a growing need. Essentially, you’re on base once you show that more and more people need your product.

Double

Any growing company with sales over $10M.

Triple

Any growing company with sales over $100M. Local or distant leadership. Note: huge acquisitions by distant companies will still be considered a triple due to loss of local leadership.

Home Run

>$1B market cap. Local leadership.

Grand Slam

>$10B market cap. Dominates its market; fast market growth. Local leadership.

Bill followed his scorecard manifesto with some practical suggestions on how to improve the score in this playbook.

What Bill’s getting at is that we need to think actively about building large, local companies to serve as anchors for our economy. For too long, our smartest companies have been sold early to acquirers on other coasts. This behavior deprives us of market leadership, dampens the flow of experienced executives to our region, especially in scaling and execution roles such as sales and operations, and ultimately relegates us to being the world’s R&D lab. Not a bad position on the ball field, but we can do better.

In the ensuing chatter, some have argued that economics, particularly venture fund economics, drive the decision to sell early versus growing a company independently. While this is can be true, I believe that the volition of our startup executives, and the values of our investors, can play a big role, since it is rarely certain that selling early provides a bigger ultimate return than staying in the game. A quick exit can pay for a new car, a new house, and maybe a new life for a founder. Sticking around and growing a business through difficult realities is hard work, but real impact in the Bill Gates and Steve Jobs league requires sticking around.

Hearing top startup CEOs mull over Bill’s challenge, I get the sense that a lot of folks are getting religion, and are saying “Yeah! Lets take our creations all the way.” In the end it is this attitude, more than any other factor, which will cause us to build more Gillettes, Genzymes, Akamais and EMCs.

Comments (8) | Reprints | Share: