Ah, the good old days of April. Spring was in the air, and bankers were running the numbers on IPOs for Northwest technology companies. It was fun while it lasted.

Here’s the flashback: Real-estate website Zillow filed its paperwork on April 18, and RFID maker Impinj followed suit three days later. I even interviewed Seattle-area investors and entrepreneurs about whether these were the first ripples of a new boom for local tech companies.

So much for all of that.

Zillow (NASDAQ: Z) did successfully go public, opening trading on July 20. But Impinj has moved slower, not updating its SEC filings since mid-July. And some other Washington state companies that say they have the fundamentals to go public are staying away until the markets improve.

Exhibit A is Inrix, the Kirkland-based provider of traffic data that started as a spinout from Microsoft. Back in late July, Inrix reported a new $37 million financing round, and CEO Bryan Mistele told me that the company was ready to go public “sooner rather than later,” and was doing better than Zillow when it filed.

That was just five days after Zillow started trading, and two weeks before S&P’s downgrade of the federal government sent the stock markets into a tailspin. These days, Inrix is taking a wait-and-see approach, spokesman Jim Bak says.

“Was it in he cards this year? Yes. Are we choosing to play the hand? No,” Bak says.

He points out that Inrix is having another good year—it’s a profitable, cash-flow-positive company that doesn’t need an IPO to sustain its business. So that makes the decision to wait and see even easier.

“We’ll probably have another year under our belt of 100 percent year-over-year cumulative annual revenue growth,” Bak says. “Everything is in place. The numbers are there, the growth curve is there … but the climate really isn’t ready.”

Vancouver, WA-based nLight Photonics, which makes semiconductor lasers, also has been talking up its IPO potential this year. In a series of news reports tied to its $17.5 million financing round in late August, company officials and investors said nLight was poised for an IPO—although they generally declined to put a timeline on taking that step.

But it definitely doesn’t sound like the step will come anytime soon. “When volatility is how we’ve seen, it’s not a good time to go public,” CEO Scott Keeney says.

In the meantime, nLight is profitable and growing 30-40 percent a year, Keeney says.

“It’s hard to speculate on how the current market changes the exact timing of how we’re thinking about the big step,” Keeney says. “I can say we are a fast-growing, strong venture-funded company, and that’s clearly in our plans.”

Impinj couldn’t comment on the timing and particulars of its IPO filing because it’s in the middle of the registration process, but said a public debut is still in its future.

“While the recent volatility in the capital markets has impacted many IPOs, we have no current intention of withdrawing our registration statement,” spokesman Jim Donaldson says. “The timing of Impinj’s IPO by will depend on many factors, including conditions in the capital markets, conditions in the markets for our products, and our financial performance.”

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Milpitas, CA-based Kovio, which is developing silicon printing technologies that can be used to produce radio-readable barcodes for product tracking and retailing, said this week that it has obtained $15 million in new equity financing. Strategic investor Tyco Retail Solutions, a, division of Tyco International, led the round, which was joined by existing investors Kleiner Perkins Caufield & Byers, DAG Ventures, Northgate Capital, Harris & Harris, Flagship Ventures and Pangaea Ventures. ”We are delighted to be partnering with Tyco to bring to market the world’s first commercially available products that leverage Kovio’s printed silicon capabilities,” Kovio CEO Amir Mashkoori said in a statement. The company says that consumers with smartphones carrying near-field-communications (NFC) technology will be able to wave their phones near products with Kovio tags and “gain deeper product insight, take advantage of targeted promotions and offers, and be assured of a product’s safety and authenticity.”

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Hundreds of people packed the Bell Harbor Conference Center on Seattle’s waterfront yesterday for the University of Washington’s annual Business Plan Competition. Now in its 14th year, the competition is a great showcase of energy and ideas from student entrepreneurs and some of their more experienced collaborators.

Last night, the group of 37 teams was whittled down to the “sweet 16″ semifinal round. You can learn more about the particulars of the competition at the Foster Business School website, and check out the list of the 16 semifinalists.

I wasn’t there as a judge, but decided to compile a few capsules of the proto-companies that caught my eye—even though some of them didn’t make the next round, or even have websites yet, we could be hearing more from these folks in the future.

Yoi! Gaming
Massively multiplayer video games are not exactly mainstream, but the people who are into them are really passionate—there are mini-celebrity players who make a living in competitive gaming, John Madden-esque online commentators, and big tournaments with serious prizes.

But Yoi! Gaming CEO C.J. Wong says there’s a gap between those big tournaments, which can be difficult to qualify for, and the smaller, local competitions that rely on having everyone in the same place. “We feel like we’re in 1918 before the NFL started—there’s a bunch of small leagues out there,” Wong says.

The idea behind Yoi! is to set up online matchmaking that can sort people into quick groups for competing against each other, with buy-ins and prizes—something that should sound familiar to anyone who’s seen online poker sites explode in the past decade.

Wong says, however, that online video gaming competitions have avoided the heat that regulators have applied to poker companies because the games are seen as more skill-based, and not related to gambling. Yoi! already has a license from Blizzard Entertainment, the makers of hugely popular game StarCraft—which, I am not making this up, is so popular in South Korea that tournaments are shown live on TV.

ZeroBrane
These guys are developing a small, cheap robot that uses a smartphone as its brain. The little machine, which looks like an iPhone riding a miniature pair of Segway wheels, is intended mostly for entertainment purposes on the consumer side right now—tooling around the house or “chasing your cat,” … Next Page »

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Seattle-based Impinj, a 10-year-old RFID tech firm founded by University of Washington professor Chris Diorio, filed registration papers for an initial public offering today. The company said it was seeking up to $100 million. Impinj’s numbers were a little up and down in the past few years: The company went from about $25 million in revenue in 2008 to about $21 million in 2009, before bouncing back to about $32 million last year. Impinj also isn’t profitable, showing a loss of about $11 million for 2010. The company, a survivor of the post dot-com hype around use of RFID for supply-chain tracking, is backed by a number of VC firms, including Madrona Venture Group, Samsung Ventures, and Unilever Technology Ventures. Underwriters for the IPO are listed as Morgan Stanley and J.P. Morgan, with Needham & Co., Pacific Crest Securities and Raymond James.

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San Diego’ Awarepoint, which developed wireless tags and a computerized tracking system to help hospitals and healthcare providers keep track of ventilators and other equipment, has acquired Patient Care Technology Systems, a workflow software developer in Charlotte, N.C. Financial terms of the deal were not disclosed. Awarepoint has installed its asset tracking technology in 93 hospitals; Patient Care Technology Systems provides its software for managing hospital work flow to 60 customers. Awarepoint says the deal announced today gives it the ability to manage patient discharge information, emergency room activity, and scheduling for diagnostic imaging, laboratory services, patient surgeries and other operations.

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Santa Clara, CA-based RFID tag and reader maker Intelleflex, which raised $8 million in Series A financing in November 2009, said today (PDF) that it has closed an $11.5 million Series A extension with existing investors Arcapita Ventures and New Venture Partners. The company will use the funds to boost sales and marketing of its low-cost, temperature-sensitive RFID tags, which it says can help reduce losses in the supply chain for perishable food and cold pharmaceuticals.

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This is “Day 3″ on the job for Jay Deady, who was named as the new president and CEO today at San Diego-based Awarepoint, which uses wireless mesh networking and RFID technology to track just about anything that moves inside a hospital, clinic, or medical center.

I figured that’s plenty of time for the new Awarepoint CEO to articulate his strategy, and Deady, believe it or not, was actually willing to discuss at least some of his thinking. Deady also says the seven-year-old startup recently raised $9 million in a combination of equity and debt, although it’s being reported incorrectly as almost $3.3 million, based on a Form D regulatory filing that reflects only part of the overall deal.

He adds that all of the company’s existing investors participated in the equity part of the deal, which represents new money since Awarepoint raised $10 million in March.

Deady was previously the Atlanta-based executive vice president of client solutions for Eclipsys (NASDAQ: MDRX), a health IT technology provider now known as Allscripts after merging with Allscripts Misys just three months ago. Deadywas previously a senior vice president at McKesson Provider Technologies, another health IT company based in nearby Alpharetta, GA. Deady says he also worked at Kansas City-based Cerner, and that his experience and contacts in the Midwest, Mid-Atlantic, and Southeast regions should complement the inroads that Awarepoint already has at hospitals on the West Coast.

Awarepoint uses Zigbee-based devices that simply plug into electrical outlets to create a wireless mesh sensor network that encompasses an entire hospital or medical center. The network can track the location of patients, healthcare equipment, medical devices, and anything else with a Radio Frequency Identification (RFID) tag.

At Eclipsys, Deady led … Next Page »

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The lowly surgical sponge is one of the basic commodities all hospital operating rooms need, and which most just buy in bulk from the cheapest suppliers they can find.

But to RF Surgical Systems, a Bellevue, WA-based company with an engineering center in San Diego, there’s a lot more going on in surgical sponges. The company is seeking to build a whole new market with radio-frequency tags embedded surgical sponges that will make it so doctors and nurses no longer have to scramble around counting dozens of sponges after the end of an operation, hoping they didn’t leave any material behind inside the patient who just got sewn up.

More than 20 million people undergo surgery each year in the U.S., according to one 2005 estimate from Stanford University. It’s hard to know how many surgical sponges are consumed every year in the U.S., but depending on blood loss in emergency situations, it’s not uncommon for a surgeon to go through 20 to 60 of them, according to RF co-founder Jeffrey Port, a heart/lung surgeon at New York Presbyterian-Weill Cornell Medical Center. Data is a bit sketchy on how many sponges actually get left behind by accident, but it happens an estimated 3,000 times year, according to the federal Agency for Healthcare Research and Quality.

More often, nurses get placed under lots of stress, and a lot of precious time gets wasted when a post-op count goes wrong. When a sponge does get left behind, the lawsuits, of course, will follow. (I found one of these painful stories in a recent Miami Herald piece.) RF Surgical’s bet is that hospitals will pay a little bit more for sponges with radio-frequency tags in them. Any tags left behind would trigger a wand waved over the patient to emit a sound, so a quiet sweep would provide peace of mind for the surgical team.

Jeffrey Port

The market for this invention? Possibly $500 million to $1 billion a year in the U.S., Port says.

“We’re talking about really solving this problem,” Port says. “I think we will see not a single retained foreign body left behind after surgery in three years.” It won’t be easy, he adds: “It makes a lot of sense, but we have to show it works. No one will mandate it.”

The idea of using radio-frequency tags has been around for a long time as you can see from this list of patent references, and even though the surgical sponge problem is so notorious, no one has built a big business on the concept yet. Port, who co-founded RF in 2005, was inspired to do something about the problem late in his surgical residency at Bellevue Hospital Center in New York, the oldest public hospital in the U.S. He was fascinated by how so much gauze went into patients, and how nurses had to track it all manually, all in the chaos of an ER. When the count didn’t add up, a patient might lay in the operating room for 45 minutes on a ventilator waiting for an X-ray machine to look for the missing gauze inside. The scans were sometimes read by someone late at night, who didn’t always … Next Page »

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Last week wasn’t awash in early-stage startup news—familiar Bay Area software, Web, and energy companies dominated the technology headlines.

—A coalition of online travel companies including Expedia, Farelogix, Hotwire, and Sabre Holdings launched a lobbying effort to persuade the U.S. Department of Justice to block Google’s proposed acquisition of Cambridge, MA-based ITA Software. The group, called FairSearch, says a Google-ITA combination would decrease competition in the travel search market, since ITA’s QPX flight data service is used by nearly two-thirds of travel sites. Google fired back, saying it wouldn’t use its control of ITA’s tools to edge out competitors, and that it merely wants to offer consumers easier ways to find cheap flights.

—Trimble (NASDAQ: TRMB), the Sunnyvale, CA, company famous for its GPS-based navigation hardware and software, announced that it had acquired ThingMagic, an MIT spinoff in Cambridge, MA, that specializes in building readers for radio frequency identification (RFID) systems. My colleague Greg spoke with ThingMagic’s CEO, who said that with Trimble’s resources behind it, the company will be able to bring RFID technology to new markets.

—TIBCO Software (NASDAQ: TIBX) founder and CEO Vivek Ranadivé is getting ready to publish his next business book—The Two-Second Advantage—and I had an opportunity to sit down and speak with him about the importance of timely information in business and the future of Silicon Valley.

—I profiled OhLife, a Y Combinator-backed startup in San Francisco that’s working to reinvent the daily journal using e-mail as a conduit. The company’s free service sends users a daily e-mail prompt reading “How did your day go?” Replies go into a private online journal on the OhLife website.

—In my weekly column, I asked why entrepreneurs in startup hubs like Boston say they feel more isolated and siloed than those in Silicon Valley, and concluded that at least part of the antidote is to drink more and throw more parties.

—A new downtown San Francisco coworking facility called NextSpace aims to provide 1- and 2-person companies with basic services, camaraderie, and access to business and investing advice, as contributing writer Deborah Gage explained.

—Digg’s new CEO, Matt Williams, announced major layoffs at the social news aggregation startup intended to help the company reach profitability. A total of 25 staffers were let go, out of 67.

—BrightSource Energy in Oakland, CA, announced that has lined up $300 million in private financing for its massive solar thermal plant in Ivanpah, CA, courtesy of NRG Solar, a subsidiary of Princeton, NJ-based NRG Energy (NYSE: NRG).

—In other deals news, RGB Networks raised $20 million, GigaOm raised $2.5 million, CloudEra raised $25 million, Pelican Imaging raised $10 million, Appcelerator raised $9 million, Adap.tv raised $4.6 million, CarbonFlow raised $4.2 million, Kiip raised $300,000 in seed funding, and Nanosys announced the second close of its recent Series E funding round, which increased to $31 million.

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Yesterday’s acquisition of Cambridge, MA, technology firm ThingMagic by Silicon Valley-based Trimble (NASDAQ: TRMB) left a lot of people in the radio frequency identification (RFID) and location-based tech sectors wanting to know more. I spoke with both companies late in the day to get some answers.

Overall it sounds like a fairly standard acquisition that allows ThingMagic to continue its RFID operations and business under new ownership. “We decided it was best to acquire the assets from ThingMagic—the people and the team, experience, and the [intellectual property], name, and branding. All [employees] are invited to come on over,” says Jurgen Kliem, vice president of Trimble’s strategy and business development.

ThingMagic is now a 33-person division of Trimble, which has some 3,800 employees in 23 countries (it already had a small software group in Waltham, MA). The ThingMagic offices in Cambridge and Woburn will remain, and employees will be staying put for now. That seems important, since the company is one of the stalwarts of Kendall Square and the local tech startup scene, having been founded in 2000.

“The benefit and opportunity, from my perspective, is enormous,” says Tom Grant, ThingMagic’s chairman and CEO, and now a general manager at Trimble. “We’re beginning to see substantial growth in RFID…and need to make sure we continue to fuel that growth.” Trimble represents a “shot in the arm,” he says, in that ThingMagic now gains the financial support of a billion-dollar company. Grant will lead a division that “lets us continue with our global market strategy,” he says.

The deal represents an exit for ThingMagic’s venture investors, which have included (all in the past five years) Tudor Ventures, The Exxel Group, Cisco Systems, Morningside Technology Ventures, and In-Q-Tel. The companies did not disclose the size of the acquisition, so it’s hard to tell how well the investors made out. (Word on the street is that ThingMagic raised more than $30 million, and—this is pure speculation based on what I’ve heard from sources outside the companies—the acquisition is for less than $55 million.)

“To our investors, this was a desired outcome. They wanted this and we accommodated it,” Grant says.

It’s not totally clear how Trimble plans to integrate RFID into its asset-tracking and … Next Page »

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This is big news for the Boston and MIT startup communities—and maybe for Silicon Valley tech observers too. Cambridge, MA-based ThingMagic said today its technology has been acquired by Trimble (NASDAQ: TRMB), a mobile and location tech firm based in Sunnyvale, CA. Terms of the deal weren’t given, and representatives from the companies weren’t immediately available to comment this morning.

The deal is a bit of a head-scratcher for me. Yes, things have been happening fast in the world of radio frequency identification (RFID)—this is the wireless communication technology that enables retailers to track inventory, mobile field workers to track tools, and hospitals and medical staff to track expensive equipment such as surgical tools. Earlier this month, I wrote about a resurgence in the RFID industry, as a few companies that endured the decade-long drought of slow adoption of the technology have started seeing some real growth in the past few months.

But why would ThingMagic sell at this point? The 10-year-old company has survived a long history of ups and downs in the marketplace, and was starting to see some gains in customers and revenue. The company makes software and hardware for RFID readers, and has a grand vision of helping create an “Internet of things,” whereby people can get information about objects in the real world around them, in real-time.

So far, all we’ve received officially is a canned statement from ThingMagic. “Our RFID excellence combined with Trimble’s global reach and domain expertise is a strong platform that can enable the next generation of RFID applications,” said CEO Tom Grant, in a statement.

How strong an exit is this deal for ThingMagic’s founders and investors (which have included Tudor Ventures, The Exxel Group, Cisco Systems, Morningside Technology Ventures, and In-Q-Tel)? What will become of ThingMagic’s Boston-area offices and staff (30-some employees)? It’s not clear whether this deal represents an asset sale, a technology integration, or some other arrangement. All we know from the release is that “the operating results of the acquired business [ThingMagic] will be reported within Trimble’s Advanced Devices segment.”

Trimble is known for its GPS and location-based technologies, which are used by mobile workers in the field for surveying, construction, agriculture, mapping, and other applications. So it sounds like ThingMagic’s RFID technology and expertise will be folded into some of those capabilities.

Indeed, ThingMagic co-founder Ravi Pappu may have hinted at the company’s broader future back in July. “It’s not just about the RFID,” he told me. “It’s about reaching out to the tag, reading data, and connecting to other systems, like Bluetooth, GPS, Wi-Fi…By combining those, you now have the Internet of things.”

We’ll have more on this story if we learn anything significant from the companies.

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As a reporter, you can tell when the innovation economy tide is turning, when a particular sector is rebounding, or when certain companies have turned the corner. How? Because all of a sudden CEOs want to talk on the record, PR people are your best friends, and marketing and real estate guys chat you up about the field at random events.

That’s the feeling I’m getting about radio frequency identification (RFID) these days—and I’m getting it from both coasts. The field of RFID comprises tags, readers, and software that, together, enable wireless communication via tiny embedded chips so people can gather information about everything from the location and status of product inventory on shelves to runners in a marathon. A couple of months ago, I profiled ThingMagic, a 10-year-old Boston-area RFID company founded by MIT Media Lab alums, whose time appears to have come, thanks to fortuitous changes in the market.

ThingMagic’s sister company in the Northwest is Impinj, a 10-year-old Seattle RFID tech firm founded by University of Washington professor Chris Diorio. Impinj is a bigger company than ThingMagic—and has raised much more venture capital—but both startups survived the RFID-for-retail-supply-chain-tracking hype around 2003-2004 (and the ensuing crash) and lived to tell the tale. The firms have worked together on RFID reader technologies, with Impinj selling its reader chips to ThingMagic. Now they and a few other survivors and competitors, including San Francisco Bay Area-based Alien Technology, are poised to make some bold moves.

I spoke with Impinj CEO Bill Colleran by phone last week to hear about the company’s progress, and some interesting new challenges ahead. One thing that grabbed me was how much the competitive landscape in RFID was decimated by the early hype and glacial adoption of the technology—plus the economic recession. That now leaves Impinj with relatively few competitors. “There’s been a shakeout along the way,” Colleran says. “We’re in a great position to grow as this industry takes off.”

And take off it apparently will, across sectors like consumer electronics, automotive, healthcare, and apparel and other retail applications—finally. “RFID has experienced a resurgence in the last year or so,” says Colleran. “The common theme is the technology has continued to move along—performance is dramatically better, and cost has come down…It’s a maturing of the technology and ecosystem. We’re seeing wholesale adoption.”

That’s easy to say, of course, but here are some stats to back it up. Impinj says it will ship as many RFID tag chips in the second half of 2010 as it has in the previous five years … Next Page »

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We saw news of acquisitions and financing rounds for New England’s tech, life sciences, and energy firms—including some developments in what could be one of the biggest buyouts in some time (see below).

—NKT Therapeutics, a Newton, MA-based developer of drugs to stimulate natural killer T cells, brought in a $4 million equity round, according to an SEC filing. Last year the company raised $8 million in Series A funding, from SV Life Sciences and MedImmune Ventures.

—Newton-based ExtendMedia, a video software maker, will be acquired by networking giant Cisco Systems. The companies did not release financial details of the deal, which is expected to close in early 2011. ExtendMedia’s Newton office will remain as part of the deal, and all of the company’s employees will join Cisco.

—Wavemark, a Littleton, MA, maker of radio-frequency identification tags for tracking hospital inventory, raised $3.9 million in equity-based funding. The financing includes the conversion of some notes, and will be put toward working capital for the company, according to an SEC filing.

—Ameresco (NYSE: AMRC), a Framingham, MA-based provider of energy-efficiency services, said it agreed to acquire Renton, WA-based Quantum Engineering and Development. Ameresco, which manages the development and operation of renewable energy plants, did not reveal how much it paid for Quantum, a provider of energy and water auditing, engineering, construction, and commissioning services.

—Cambridge, MA-based biotech giant Genzyme (NASDAQ: GENZ) said its board of directors had unanimously rejected a buyout bid from French drugmaker Sanofi-Aventis. The Genzyme board said the $69-per-share cash offer from Sanofi did not recognize the progress the company has made in rectifying its manufacturing issues from last year and the potential in its product pipeline.

—Yottaa, a Cambridge-based Internet startup, announced it had attracted $4 million in Series A funding from General Catalyst Partners, Stata Venture Partners, and Cambridge West Ventures. The company also released a free, private beta version of its analytics service for monitoring website performance.

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We saw news from drugmakers, device companies, and health IT firms this week.

—Anchor Therapeutics, a Cambridge, MA-based biotech formerly named Ascent Therapeutics, brought in $10 million in a Series B round, with investments from TVM Capital, HealthCare Ventures, and the Novartis Option Fund. Anchor is working on drugs it calls “pepducins”—short pieces of proteins linked to a lipid molecule that anchors the drug in the membranes of targeted cells. Anchor is developing the drugs to treat blood cancers, and inflammatory and metabolic conditions.

—Cambridge-based Aileron Therapeutics landed a deal with Swiss drugmaker giant Roche that could be worth up to $1.1 billion. The biotech has gotten $25 million in technology access fees and R&D support from Roche as part of the partnership, to put toward developing and commercializing a new class of drugs called stapled peptides. Aileron could attract up to $1.1 billion in milestone payments if its meets development goals for drugs targeting Roche’s main treatment focuses: oncology, virology, inflammation, metabolism, and the central nervous system.

—Danvers, MA-based medical imaging startup Photo Diagnostic Systems pulled in $5 million in equity-based funding. The firm is developing a portable positron emission tomography scanner.

—MedNetworks, a Newton, MA-based provider of social network analytics for healthcare, announced it was applying its technology to population health management, through a partnership with Tennessee-based Healthways. The company, which provides customized wellness programs, will use the MedNetworks technology to track how patients in a population influence each other’s health decisions.

—Newton, MA-based drugmaker NKT Therapeutics pulled in a $4 million equity financing from three unnamed investors, according to an SEC filing. The startup is developing drugs that target white blood cells known as natural killer T cells, which are thought to incite greater immune responses to diseases such as asthma and cancer.

—Ryan wrote how the health insurance reform could offer incentives for insurers to adopt technology from HealthEdge Software, a Burlington, MA-based provider of software enabling insurers to design customized health plans. The software allows insurance companies to more quickly update their policies to comply with the new laws under the reform act, like the one that now allows children to stay on their parents’ plans until age 26.

—Littleton, MA-based Wavemark, a maker of radio-frequency identification tags, raised $3.9 million in an equity offering, to put toward working capital. The startup’s products help hospitals track the usage and expiration of medical supplies.

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ThingMagic is a 10-year-old technology company whose core idea seems as fresh today as when it first started. The bad news: that means it may have been too far ahead of its time. The good news: times are changing.

The Cambridge, MA-based firm was founded by five MIT Media Lab alums, who had the goal of “adding magic to everyday objects”—hence the company’s name. This “magic” came in the form of radio frequency identification (RFID) tags, which enable wireless communication by way of tiny electronic chips that can be embedded in things, accompanied by readers and software to make sense of what each tagged item is, and track its whereabouts. The big vision was to create an “Internet of things,” so people could retrieve information about the objects around them—everything from product inventory on shelves to stuff in your home, office, or car.

Sounds a bit far out even today, right? Well, it was far more so in the early 2000s, and the evolution of RFID ever since has been quite a rollercoaster ride. To make a long story short, the technology was strong but its business use was overhyped, so it got stuck on the adoption curve. Tech companies based around RFID have come and gone, but some have endured, such as Alien Technology, Impinj (which I wrote about here), and ThingMagic, which all have raised a fair amount of venture funding.

In July 2008, my colleague Wade wrote an in-depth piece on ThingMagic, focusing on the company’s progress in shrinking its RFID readers (its main product) down to a size where they could be put into places like offices and hospitals—a big step toward realizing the Internet of things. Around the same time, Mark Roberti, the founder and editor of RFID Journal told me that it would be another two to three years before the RFID market would take off, because end users were still figuring out the physics and economics of tags and readers.

Well, it has been two years, and I’m wondering what has changed in the RFID world. To get some answers—and an update to the company’s story—I recently sat down with ThingMagic co-founders Yael Maguire and Ravi Pappu, and director of marketing Ken Lynch, to talk about what lessons they’ve learned over the past decade. We met at the company’s new digs at One Cambridge Center in Kendall Square.

“After 10 years, we’ve seen literally hundreds and hundreds of ideas for using the technology,” says Maguire, the company’s chief technology officer. “It may not be ubiquitous, but in most cases it’s caught up with people’s imagination. People are focusing on how to deploy it.” Pappu, who runs product development and implementation, puts it this way: “The story is changing from RFID on everything to RFID in everything. That’s always been the vision of the Internet of things.”

It’s certainly in ThingMagic’s interest to promote all the new ways RFID is being used. But beyond any PR spin, there’s something real going on. Yes, there is the recent news that Wal-Mart plans … Next Page »

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Versus Technology is located at the base of the pinky on Michigan’s mitten, where Lake Michigan laps its tongue into the shining waters of the Grand Traverse Bay. Versus develops products that track patients, staff, and equipment for hospitals across the country, so it does not really need to be at this inconveniently located corner of the Great Lakes State.

But. Damn. It’s so beautiful up there. So, there is no place the 50 employees of Versus would rather live and work than Traverse City, MI.

If you look at major technology centers like Silicon Valley, Austin, or Research Triangle Park, says Versus CTO HT Snowday, “the thing that they have most in common is that they are really great places to live.” So, yes, travel expenses are greater than if Versus were in a major metropolitan area in the center of the country. Nevertheless, Snowday says, “We’re not going anywhere.”

More about the company’s Northern Michigan location later. First, let’s talk about what Versus does. In general, it uses radio frequency identification (RFID) and infrared (IR) tags on people and objects, along with sensors placed throughout a healthcare facility, to track, in real-time, exactly where everything in that facility is. Think of it as “GPS inside a building” with no false positives, says Snowday. “When Versus says something’s in a room, or someone’s in a room, they are there. There’s no doubt about it,” he says.

But that’s just the base, Snowday says. The real point of Versus’ system is to bring process automation to healthcare. Take, for example, the auto industry, where the Toyota production model, or lean manufacturing, is the goal. Those systems work because everything can be documented all the way down the assembly line. Transfer that to a hospital setting, and that’s where Versus comes in. Once you know where exactly everything, and everybody, is at any time, you can then begin to streamline the process.

Let’s say a doctor needs to spend 7.5 minutes with each patient. That doesn’t sound like … Next Page »

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There have been quite a few exciting deals for Seattle-area technology companies lately (maybe a sign that everybody in town is back from their summer vacations?). In the past week we’ve seen a digital marketing company for the auto industry get snatched up in a $400 million acquisition, several local startups bring in new funding, and Microsoft strike partnerships with a number of major global brands to expand their cloud-computer services. Take a look at the highlights:

—Seattle-based social commerce site Lockerz said it completed a Series B financing round led by Silicon Valley venture firm Kleiner Perkins Caufield & Byers for an undisclosed amount last week. The company, which boasts 15.5 million users worldwide, has previously had some big-name backers including online media conglomerate Liberty Media. The invitation-only rewards site allows people to collection points redeemable for discounts on brand name products by watching videos and interacting with the site’s online network.

—Here’s some interesting news for casual gamers. Leading casual game developer and distributor Big Fish Games has teamed up with Z2Live, both Seattle-based, to add voice chat and multiplayer capabilities to Big Fish’s popular hidden object game “Big City Adventure: San Francisco” for the iPhone and iPad.

—Seattle-based A Place for Mom, an online eldercare referral service, sold a majority ownership stake to major private equity firm Warburg Pincus. The company, started in 2000, provides a comprehensive online database and free referral service for seniors and families searching for a variety of elder care options nationwide. Terms of the deal were not disclosed.

—Automotive digital marketing company The Cobalt Group, based in Seattle, agreed to be acquired by outsourcing products and services company Automatic Data Processing for approximately $400 million in cash. The 15-year-old Cobalt Group helps automobile manufacturers and dealers improve their marketing efforts online.

—Seattle-based radio-frequency identification (RFID) systems developer Impinj raised $5.8 million in debt and options financing last week. The 10-year-old company, which has been backed by a number of VCs including Madrona Venture Group, Samsung Ventures, and Unilever Technology Ventures, has been busy developing its tracking technology over the last couple of years, bringing in $14 million in financing in 2008 and taking over Intel’s RFID business.

—DocuSign, an electronic signature automation software developer based in Seattle, raised $2 million in debt financing last week. The company previously raised $30 million in venture funding since it was founded in 2003.

—Redmond, WA-based Microsoft took some important steps forward with its cloud computing strategy this week. The global software giant said Monday at its Worldwide Partner Conference that it has signed agreements with Dell, eBay, Fujitsu, and Hewlett-Packard to use its Windows Azure cloud computing software platform. Financial terms were not disclosed, but some details on the nature of the partnerships were shared. For example, Dell will be partnering with Azure in order to deliver cloud-based services to its corporate customers, while eBay will be using the program to improve upon its existing e-commerce services.

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Seattle-based Impinj, a radio-frequency identification (RFID) systems developer, has raised $5.8 million in debt and options financing, according to a regulatory filing. The company, founded in May of 2000, received $14 million in venture funding in 2008, and later that year sold off its nonvolatile-memory intellectual property business for $5.2 million and acquired Intel’s RFID business in order to focus on tracking technology development. Impinj has been backed by a number of VC firms, including Madrona Venture Group, Samsung Ventures, and Unilever Technology Ventures, and was called out as the most exciting tech company in Seattle by Intellectual Ventures’ Patrick Ennis last year. A spokesperson from Impinj did not immediately respond to a request for comment.

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Andy Sack has been working behind the scenes for more than a year. Yes, we know he’s been busy bringing the first session of TechStars, the startup bootcamp, to Seattle this fall. He’s also been co-leading Founder’s Co-op, the seed-stage investment fund, for the past couple of years. But just when you think the Seattle tech entrepreneur and angel investor has his hands full, he busts out with a new venture. This one could have even greater implications for startups, entrepreneurs, and innovation—and not just in Seattle.

It’s called RevenueLoan, and Sack is the founder and CEO of this new company. Its goal is to provide capital for promising startups in the Pacific Northwest, and across the country, using a different kind of investment model called “revenue-based financing” (sometimes called “royalty-based financing”). Before we get into exactly what that means, here are the hard facts. RevenueLoan has raised $6 million from Seattle-based firms Voyager Capital, Summit Capital, and Founder’s Co-op, to make investments and support operations. Sack says he will remain a partner with Founder’s Co-op, but will step away from co-leading that fund to focus on RevenueLoan and TechStars. (Founder’s Co-op will be led by Chris DeVore and Geoff Entress.)

The idea of RevenueLoan is to make investments in the range of $100,000 to $500,000, Sack says, targeting companies that already have between $500,000 and $5 million in annual revenue. Instead of taking an equity stake in the company like a traditional VC firm would, RevenueLoan will receive a percentage of future revenues (typically 1 to 10 percent). The investor can generate a maximum of a 3-to-5 fold return on his investment. That’s the “revenue-based” part of the equation, and the goal is to open up a wider range of companies to invest in, where the investment returns will flow if the company is able to execute on its business plan. Such an investment model doesn’t depend on a company going public or getting acquired, like traditional venture capital.

Since the IPO market has been in a drought for years, and acquirers in such an environment can afford to drive a hard bargain, this revenue-based model definitely has appeal. After all, early-stage investors are starving for some way to generate returns. And for entrepreneurs, it can offer a new way to get the capital they need for expansion, while allowing them to spend more energy executing on their business plan rather than chasing the all-important “exit” that VCs crave.

“We’re going after a segment that is today underserved by traditional equity like VCs and banks,” Sack says. “It’s a huge market.”

Revenue-based finance is not a new idea. As I first described in a feature last October, the model dates back to traditional mining companies and government economic development programs. Since the early 1990s, it has been applied to early-stage technology startups by a handful of … Next Page »

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JAFCO Ventures of Palo Alto, CA, has stepped in as lead investor in a $10 million round announced today by San Diego’s Awarepoint, which provides wireless sensor systems to help hospitals monitor the real-time location of equipment and patients. Existing investors Cardinal Partners and Venrock Associates joined in the Series E round.

As I explained last year, Awarepoint uses ZigBee-based devices that plug into ordinary power outlets to create a wireless mesh sensor network that encompasses an entire medical center. The system provides real-time tracking of RFID (radio frequency identification) tags that are embedded in patient wristbands and attached to medical instruments.

Awarepoint says the capital infusion will be used to accelerate its development of new technology and products, and to help the company market its capabilities. The company was founded in 2002. As part of the financing, JAFCO Ventures general partner Tom Mawhinney will join Awarepoint’s board. The Palo Alto venture firm is affiliated with Tokyo-based JAFCO, the private equity firm previously known as Japan Associated Finance Co.

Awarepoint CEO Jason Howe told me last year the company has raise more than $24 million from investors, lenders, and in vendor financing. Awarepoint did not identify a previous investor, San Diego’s Avalon Ventures, as a participant in the latest round, and the company no longer lists Avalon’s Steve Tomlin as a board member on its website.

Tomlin tells me by e-mail this morning: “We do still have an Observer seat and stay actively involved. Avalon is always delighted when our companies attain a level of maturity that they don’t need us on the Board—and, to the delight of our investors and ourselves, it frees Avalon’s partners’ time to engage in more early-stage-oriented activities…”

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