“Earth’s biggest bookstore,” boasted Amazon.com in the early days after its 1995 launch. Nearly 15 years later, Amazon seems more like Earth’s biggest store, period. Music and movies, videogames, clothing, toys, furniture, even food, it’s all just a few clicks away. And with last week’s acquisiton of online retailer Zappos.com (originally estimated at $850 million, now believed to be about $920 million with the changes in stock price), there seem to be no real rivals to Amazon’s dominance of online retail.

Rather than competing with established companies in a retail sector it wished to expand into, Amazon often has purchased one or more of the possible rivals and absorbed them into itself. While some erstwhile rivals have simply been outcompeted, a chart created by Meet the Boss (see below) shows how Amazon has gobbled up rivals almost since it began. And even with tax and legal troubles, Amazon shows no sign of slowing down, having already bought more companies, six, in 2009 than in any other year except 1999 when it bought 14 different companies.

Over the years, Amazon seems to have focused on one area of online retail at a time to acquire companies in—like major audio book company Audible, bought in 2008, just months after it bought Brilliance Audio, another important audio book firm. And Amazon keeps an eye on other general online retailers. Zappos may be the big news this year, but Talk Market, an online boutique, is under the Amazon umbrella too. And now that it owns e-book company Lexcycle, as well as picture product matcher Snaptell, and other next-gen technology companies that once competed with it, Amazon’s place as king of Internet retail seems more secure than ever.

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Amazon’s e-book reader, the Kindle, dropped $60 in price today from $359 to $299, only five months after the February debut of the second generation reader.

The price change comes as something of a surprise, after repeated statements from Amazon CEO Jeff Bezos to the effect that the company could not sell the Kindle for less than $359, given the expense of components such as its electronic-ink screen, made by Cambridge, MA-based E Ink. ”If we could make it cheaper we would. We can’t make it cheaper,” Bezos said in an interview with Reuters in February.

Technology seems to have improved since then. In an e-mail message today, Amazon public relations manager Cinthia Portugal said “We’ve been able to increase the volume of Kindles we’re manufacturing and decrease the cost of doing so. Across our business at Amazon.com, whenever we are able to create cost efficiencies like this, we pass the savings along to our customers.”

Amazon is notorious for being unwilling to share sales information about the Kindle devices or the content they display. But in terms of manufacturing, iSuppli estimated after “tearing down” the Kindle 2 that the cost of the device’s parts totals only $185.

Although still comprising less than one percent of the overall book market, the digital reading market is growing fast, and it seems likely that many consumers will take the Kindle 2 price drop as their signal to try e-books. Amazon’s other e-reader meanwhile, a larger version of the Kindle that launched in June called the Kindle DX, is still retailing for $489 and is sold out for the next three to five weeks.

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A group of E Ink investors with concerns about Prime View International’s move earlier this month to purchase the Cambridge, MA-based e-paper display company will likely try to prevent the sale when it comes up for a shareholder vote, according to a source familiar with the company.

E Ink has roughly 100 separate shareholders; it’s not known how many of them oppose the sale to PVI, a Taiwanese firm that assembles e-book devices for the likes of Amazon and Sony and is already the largest buyer of E Ink’s display technology. But the source—an insider with deep knowledge of E Ink who requested anonymity for lack of authorization to speak on the record—says the proposed sale agreement, which has already been approved by E Ink’s board of directors, will likely be defeated when E Ink shareholders get the opportunity to vote on it.

A vote has not yet been scheduled. E Ink, for its part, says it intends to complete the proposed $215 million sale. “The Board of Directors of E Ink has voted in favor of the sale agreement with PVI and the company fully intends to consummate the transaction,” E Ink said in a statement released last night through a spokesman. The sale, first announced June 1, is subject to approval by PVI shareholders and regulators in both Taiwan and the United States.

Shareholder discontent about the proposed sale surfaced Saturday in an article by Boston Globe reporter Robert Weisman. That article focused on concerns about the $215 million bid offered by PVI, which some shareholders reportedly believe is too low, given new estimates that the MIT spinoff’s revenue from e-paper sales, which are soaring thanks to the popularity of Amazon’s Kindle e-book devices, could top $110 million this year.

That was one of the shareholder concerns relayed by Xconomy’s source. Investors are doing the math, the source says, and concluding that $215 million is an inadequate offer for a company that may be one of the fastest-growing startups in the Boston area.

But the source lists several other factors that have become sticking points for certain E Ink shareholders. In particular, the source says, companies that are considered strategic investors in E Ink, because they are in related industries such as publishing and electronics, are concerned that the acquisition of E Ink by PVI would give control of E Ink’s unique electronic paper technology to a single company.

In particular, Hearst Interactive Media, E Ink’s largest single strategic investor, is concerned about the idea of being locked into PVI as a supplier of e-paper for its digital newspaper project, called FirstPaper, the source says. (Hearst had not replied to a request for comment by the time this article was published.)

Fears about monopoly control of e-paper may have been exacerbated by a statement from PVI’s chief financial officer, Stephen Chen, on the day the acquisition was announced. Dow Jones Newswires quoted Chen as saying, “We can lower costs and dominate the market by acquiring E Ink.”

The depth of PVI’s pockets, or lack thereof, is another issue for E Ink shareholders, the source says. The company is a small-cap corporation listed on Taiwan’s ROC Over The Counter Stock Exchange, with a total market capitalization of just over $750 million. According to the source, the company does not actually have enough cash on its books to pay the promised $215 million for E Ink, and has been attempting to raise the capital needed to close the deal on the strength of E Ink’s newfound success selling the display material used in the Kindle. Investors would prefer to deal with a buyer that’s able to raise the capital on its own merits, the source says.

We have requested comment from PVI, but as of press time, the company has not responded.

The concerned E Ink shareholders aren’t simply holding out for a higher bid from PVI, according to the source. Rather, there’s a growing feeling among this contingent that the Cambridge company should stay independent, and try to cash in on the rising e-book tide.

We reviewed all of the shareholder concerns listed by our source with E Ink. The company declined to provide further comment.

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If this column has a repeating theme, it’s the amazing new capabilities we’re all gaining as a result of the digital media explosion. Yet like all revolutions, this one is destroying old values, attitudes, and behaviors even as it creates new ones. I would never trade the Web, mobile computing, and the instant access to digital culture that they enable for the media universe that existed before, say, 1995—but I also think it’s important to be aware of what we’re leaving behind. So this week I want to get down a few thoughts in remembrance of a little something called going out of your way.

Do you find yourself listening only to the music you can download from iTunes? Watching only the movies you can find in your cable provider’s video-on-demand lineup? Reading only the books you can order from Amazon? Going only to the restaurants you can find on Yelp? I certainly do. And I think this is a growing tendency, thanks to the ubiquity of cheap digital content and devices that can access it. At the risk of being taken too seriously, I want to coin a pseudomedical term for this pattern: On Demand Disorder, or ODD.

The main symptom of ODD is an aversion to any experience, product, or piece of content that can’t be obtained more or less instantaneously. And the main long-term consequence may be a narrowing of one’s world-view to exclude ideas and materials that take a little more work to uncover.

I’ll illustrate with a few examples from my own life. As a gadget freak, and as someone whose job is to keep abreast of the latest digital technologies, I may be an edge case. But perhaps you’ll recognize similar patterns in your own routine.

1. In the three months since I bought a Roku Player—a $99 wireless device that lets you view movies from Netflix and Amazon on your TV instantly—I have watched dozens of movies and TV shows on the Roku. In the same time, I’ve watched exactly two physical DVDs from Netflix. My “Instant” queue keeps turning over, but I haven’t made any progress on my regular DVD queue. This despite the fact that the selection of DVDs at Netflix is still far greater than the selection of so-called “Watch Instantly” movies. In effect, I’m sacrificing choice for availability.

2. I used to be a fairly regular buyer of books from Amazon. About six weeks ago, I decided to splurge on a Kindle 2 e-book reader. Guess how many physical books I’ve ordered since then? One. Partly, I’m just trying to get my money’s worth out of the Kindle. But now that I have the option of buying a book through the device’s built-in catalog and having it delivered wirelessly in under 60 seconds, instead of ordering it online and waiting for it to arrive three to seven days later in the mail, I’ve become far more cognizant of my own impatience. When I get a hankering to read a book, I usually want to read it now. By the time Amazon can ship me the physical book, the feeling of urgency may have passed, or I may have found the information I needed elsewhere. The one book I did buy was an out-of-print monograph from an academic press that will likely never be made into a Kindle Edition.

3. I’ve been an active amateur photographer ever since my grandfather gave me one of his old Nikons when I was a teenager. My collection of thousands of photographs fits into roughly four buckets: a) 1980-1990: Ektachrome slides—my grandfather’s preferred medium—now stored in carousels and in plastic sleeves in binders. b) 1991-1997: Color prints, stored in albums. c) 1998-2004: Digital images, taken with my first two digital cameras, stored on CD-Rs. d) 2005-present: Digital images, taken with my various camera phones and my third and fourth digital cameras, stored on hard drives and on Flickr. It’s probably not hard for you to guess which pictures I view most often and least often. The sad truth is that because I can pull up my Flickr photostream instantly on my PC, my Mac, or my iPhone (or even, thanks to programs like Slickr and Boxee, on my television), the Flickr images are the only ones I ever look at.

My personal media consumption habits, of course, are of no great consequence to the larger world. What worries me is that as the amount of material available in digital, on-demand form grows, our familiarity with the non-digital world may atrophy. That would be a real shame, because …Next Page »

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Eight venture rounds—it’s got to be some kind of record. Yet that’s how many times 12-year-old E Ink went back to investors, raising some $150 million, before it finally arranged an exit scenario for its backers. The Cambridge, MA, company, which makes the e-paper displays used in the red-hot Amazon Kindle e-book reader, announced yesterday that it has agreed to be acquired by Prime View International (PVI), a public company in Hsinchu, Taiwan, that makes display electronics. The purchase price: $215 million.

“Everybody who has invested in E Ink in the last five years is going to do well” as a result of the acquisition, E Ink CEO Russ Wilcox told me in an interview Monday afternoon. I didn’t press him about the implication: that everybody who invested between 1997 and 2004 is going to do less well. But in the current economy, any kind of exit—especially for a company that has struggled so long and valiantly to bring its product to the mainstream consumer market as E Ink has—must feel like a triumph.

The length of E Ink’s odyssey was rooted partly in unexpected technical challenges, as Wilcox detailed to me in a long interview back in February. “We understood that it was probably going to take two years to make something that people wanted to buy,” he said then. “And in terms of making something that looked good, we did that. But what we didn’t see in the beginning, and learned over time, was that it would take another two years to go from something that looked good to something that would look good for many years under all operating conditions—in other words, to achieve stability and robustness. And then it would take another two years to get something that you could reproducibly manufacture, at an affordable cost point.”

But even that was just the beginning of the story. The market for e-paper devices also needed time to evolve. Sony brought out the first e-book reader based on E Ink’s electronic ink film, called Vizplex, in 2004. But it wasn’t really until this year—with Amazon’s extreme makeover of the Kindle, its subsequent success among critics and readers, and an increasing clamor within the floundering publishing industry for new distribution models—that e-paper advocates could convincingly argue that there’s a role for electronic paper in the future of the consumer electronics business.

With 127 employees on its way to 150, $18 million in revenues in the first quarter, and newfound resources in the form of its soon-to-be parent company, E Ink seems positioned to hold on to a major share of the market for text-driven device displays. It has competitors like Mountain View, CA-based Plastic Logic, which showed off its forthcoming tablet-sized e-reader at last week’s All Things D conference. But Wilcox is sanguine, saying the e-paper market is still in its early days and that there’s room for plenty of players. [Correction, 7:50 a.m. June 2, 2009: Wilcox wrote this morning to say that Plastic Logic is not a competitor: "Actually they are a customer and their CEO is a friend! All of the demos they have shown the world use E Ink Vizplex.  The merger will not affect this and E Ink has a contractual supply agreement with Plastic Logic, and (as long as they still like us) we will supply them with film for years to come."]

In our interview yesterday, Wilcox sounded noticeably relieved to have located a purchaser for the company, which means some kind of payday not just for E Ink’s investors but for its employee options-holders. He was also upbeat about becoming part of a company based in Taiwan, where the regulatory and accounting hurdles for public companies are much lower than those created by the Sarbanes-Oxley, or SarbOx, legislation here in the United States. Here’s a writeup of our whole talk.

Xconomy: Congratulations on being acquired, and thanks for making time to talk.

Russ Wilcox: Thanks. Our main themes are [that the acquisition means] more resources for E Ink; everything is going to stay in Boston and continue to expand in Boston; we have 20 open jobs; and this will help expand capacity and speed up product development and get us closer to customers all over the world.

X: Explain how you’ve worked with PVI in the past. They are the company that attaches your Vizplex film to the backplane electronics that actually drive the e-ink material, correct?

RW: Exactly. We provide the film to them, and they make the display. We also provide it to other companies that make e-paper displays, but PVI is the largest. In that sense, we are being acquired by our number-one customer. But there are others and we will continue to …Next Page »

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[Updated 9:45 a.m. June 1, 2009 with details from this morning's press conference.] Cambridge, MA-based E Ink, the company that makes the electronic paper display used in Amazon’s Kindle e-book reading devices as well as e-book devices from Sony and other companies, will be purchased by Hsinchu, Taiwan-based display manufacturer Prime View International for $215 million, according to an announcement published today.

Prime View, also known as PVI, acquired the e-paper display division of Royal Philips Electronics in 2005, and makes a bistable e-paper display called “MagicMirror” that is similar to E Ink’s technology. But PVI has also been partnering with E Ink since 2005, and is the company that joins E Ink’s “VizPlex” electronic-ink film to the backplane components needed to control the displays. The combined E Ink-PVI product is then used in e-paper-based devices such as the Kindle 2, the forthcoming Kindle DX, and Sony’s PRS-505 reader.

Now, both the manufacturing capability and the intellectual property behind the E Ink displays will be under one corporate roof. In a press release published this morning, Russ Wilcox, E Ink’s CEO, president, and co-founder, said: “Combining E Ink and PVI creates a single public company that is dedicated to electronic paper. With a common ownership structure, we can get closer to customers around the world, streamline the supply chain, and speed up new product development.”

In fact, accelerating development of color versions and flexible versions of E Ink’s displays will be the primary benefit of the acquisition, according to Sriram Peruvemba, E Ink’s vice president of marketing, who spoke at a press conference today at the Society of Information Display trade show in San Antonio, TX. “Primarily, for E Ink, it’s about access to resources,” said Perevumba, who added E Ink will show prototypes of its color e-paper displays at the trade show tomorrow.

The combined company will be headquartered in Taiwan, but the acquisition will have “no immediate impact” on operations at E Ink’s Cambridge facility, according to Peruvemba. The deal is not expected to be finalized until the fourth quarter of this year.

Decisions about the status of E Ink’s top officers are “TBD,” Peruvemba said. “For the moment the plan is that all of the curent officers will be fully engaged in developing this business. The business is continuing to grow, and it’s pretty robust, so we can use all the help we can get.”

[This paragraph corrected, see below] In fact, Peruvemba said the company hopes to add more than 20 new employees* to its Cambridge operation this year, and is advertising open positions in sales, marketing, research, and engineering. “Every single day our lobby is filled with candidates,” he said.

E Ink has not shared financial details with the media in the past, but today Peruvemba said the company earned revenues of $18 million in the first quarter of 2009. PVI earned $54 million in the same period, he said.

The $215 million purchase price represents only a modest gain for E Ink’s investors, who include industry players like Intel, Motorola, Philips, Hearst Interactive Media, and Japan’s TOPPAN Printing. Altogether, backers have put more than $150 million into the company since its founding in 1997.

Scott Liu, chairman and CEO of PVI, said in this morning’s announcement that “The world is searching for green technology that saves energy and cuts waste and still provides an outstanding experience. E Ink’s electronic paper meets those needs, especially in electronic publishing and mobile displays. The people in both companies will unite to provide the world’s best digital reading experience and that will benefit all our customers and end users.”

Xconomy published an extensive interview with Wilcox about E Ink’s history and its recent innovations in February.

* Correction 2:00 p.m. 6/1/09: This article previously stated incorrectly that E Ink is hiring 150 new employees. In fact, it currently has about 127 employees, and plans to hire about 23 people this year, expanding to a total staff of 150.

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OmniPage 17, the latest version of a Windows document version program from Burlington, MA-based Nuance Communications (NASDAQ: NUAN), has the ability to upload scanned documents directly to Amazon Kindle 2 reading devices, Nuance announced today. The new feature is part of an overall push by Nuance to help offices go paperless. The Kindle conversion process also provides the text needed for the Kindle 2’s text-t0-speech feature, which is powered by Nuance software and voices. Of course, OmniPage 17 will set you back even more than the $359 Kindle 2—the software goes for $500.

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The days have gotten longer, and deals are really flowing in the Northwest. In the past week, there has been quite a bit of activity across different sectors of biotech, energy, and software.

—Luke reported that Seattle-based Cell Therapeutics (NASDAQ: CTIC) sold $20 million worth of common stock, and warrants to buy stock, to a single unnamed institutional investor. The biotech firm hopes to swap some of that money, along with the $17.8 million in cash it currently has and some more common stock, to get rid of some $89.2 million in debt that will come due as early as 2010.

—Vancouver, BC-based Tekmira Pharmaceuticals, a maker of RNA interference drug delivery technology, formed a partnership with Swiss healthcare company Roche worth $18.4 million in upfront cash, Luke reported. Tekmira’s lipid-nanoparticle technique will be used in two of Roche’s products, and Tekmira will also receive $32 million in milestone payments if the products reach certain development goals.

—Seattle-based DocuSign, a digital-signature technology company, raised $5 million in Series D funding, led by previous investors Frazier Technology Ventures, Ignition Partners, Sigma Partners, and West River Capital. The software startup, founded in 2003, has raised some $30 million in venture capital.

—Luke reported that Seattle-based Dendreon (NASDAQ: DNDN) raised $197.4 million in a stock offering that is expected to close on May 13. The underwriter of the offering, Deutsche Bank Securities, has an option to buy another 1.27 million shares at the same terms within 30 days, which would amount to an additional $23 million. Dendreon will use the money to expand manufacturing and marketing of its experimental drug for prostate cancer, Provenge.

—Microsoft (NASDAQ: MSFT) is acquiring BigPark, an online gaming company based in Vancouver, BC. Financial terms of the deal were not announced. BigPark, which was co-founded by Hanno Lemke and Microsoft senior vice president Don Mattrick, will become part of Microsoft Game Studios.

—Amazon (NASDAQ: AMZN) has invested in Seattle-based Foodista, an online cooking encyclopedia site. The amount of funding of the Series A round, which included other angel investors, was …Next Page »

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Wade Roush wrote:

E Ink, the Cambridge, MA, company that invented the electronic paper technology behind Amazon’s Kindle e-book devices and Sony’s PRS-500 line, announced today that the same 9.7-inch screen going into the new Kindle DX will be available as part of prototype kit that will go on sale this month, before Amazon ships its own device.

The so-called Broadsheet AM300 kit—which includes an active matrix electronic ink display, a Marvell XScale processor, a Bluetooth transceiver, an MMC card reader, lithium-ion batteries, all mounted on a Gumstix computer board—will cost $4,000. Another kit including the 6-inch display used in the current Amazon and Sony devices is already available from E Ink’s online store for $3,000.

E Ink’s prototype kits are intended for hardware engineers developing next-generation electronic paper devices. Indeed, because E Ink will sell the basic technology to anyone, the larger 9.7-inch screen could become the basis of a number of devices that compete directly with the Kindle DX.

The success of E Ink’s so-called “Vizplex” e-paper films—which contain millions of tiny balls filled with electrically charged black and white particles—”has prompted a lot of interest in eNewspaper and eTextbook applications,” Sriram Peruvemba, E Ink’s vice president of marketing, said in today’s announcement.

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Fans of this column know that I spent months dithering over whether to buy Amazon’s Kindle 2 e-book reader. I had mercilessly panned the original Kindle, mainly for its ungainly looks. And while I was much more impressed by the Kindle 2 when it came out in February, I was put off by the $359 price tag, which left me casting about for more excuses to resist a purchase.

Well, I finally ran out of excuses and let my inner geek take over. My new Kindle 2 showed up last Wednesday, and I’ve been enjoying it immensely, for reasons I’ll detail below. But as luck would have it, my Kindle arrived exactly a week before Amazon CEO Jeff Bezos announced another new Amazon device, the large-screen Kindle DX. So the first question I want to tackle is whether Kindle 2 owners should feel any buyer’s remorse—that is, whether they would have been better off waiting until this summer, when the DX, with its much bigger 9.7-inch screen, will start shipping. I don’t think so. The Kindle DX will be great for reading electronic documents where some extra formatting aids comprehension—meaning textbooks, business documents like PDF brochures and white papers, and maybe magazines and newspapers. But for any document where the text is primary, meaning the vast majority of current fiction and nonfiction literature, the DX will be overkill. And for $489, the announced price of the DX, you could buy a very good netbook or even a basic laptop and get access to a much broader world of digital media, and in color to boot.

Or you could spend nothing and simply read e-books on your mobile phone. The excellent resolution of smart phones like the iPhone actually makes them credible e-book readers. Companies like Lexcycle, Shortcovers, and Amazon itself have come out with very nice e-book software for the iPhone, and e-books are the fastest-growing category of applications in the iTunes App Store. But the iPhone’s weakness—-for purposes of reading, anyway—its its limited screen size, which means you have to flick to the next page every few seconds.

The Kindle 2 feels to me like the Goldilocks of information display devices: bigger than a smartphone, but smaller than a tablet PC. Its electronic ink display, which measures 6 inches diagonally, is more than twice the size of the iPhone’s screen. It can hold about the same amount of text as one standard paperback book page, depending on the font size you’ve selected. So you press the “next page” button only twice as often as you would turn the pages of a printed book (since the Kindle doesn’t have two facing pages, the way printed books do). But it’s still small enough to make the device extremely light and portable. You can read it comfortably using one hand. I can imagine pulling out my Kindle 2 on a bus or a subway car. I’ll be surprised if I ever see anyone do that with a Kindle DX.

Reading on the Kindle 2 is a beautiful experience. It is no less immersive than reading a printed book. (The first two e-books I read on the Kindle were The Guernsey Literary and Potato-Peel-Pie Society and Pride and Prejudice and Zombies—The Classic Regency Romance, Now with Ultraviolent Zombie Mayhem; I recommend both heartily.) Of course, I didn’t really need to be convinced on this score. I first fell in love with e-book devices in 1999, when NuvoMedia brought out the Rocket eBook—in fact, I liked it so much I went to work for the company for a couple of years. But I’m still amazed by how much displays have evolved over the past decade. The Kindle’s electronic paper display, made by Cambridge, MA-based E Ink, is sharp and clear. It sips electricity like a hummingbird, meaning the battery lasts for days between rechargings. And the screen’s momentary flicker when you turn a page—which is needed to fully erase the previous screen, sort of like shaking an Etch-a-Sketch—isn’t nearly as annoying as it was on the original Kindle, thanks to the improvements E Ink built into the Kindle 2’s electronics. In fact, the screen redraws itself quickly enough now to allow a fully interactive interface, with pop-up menus for doing things like jumping around within or between books.

Far more earthshaking, however, is Whispernet, the 3-G wireless network that Amazon built for the Kindle family of devices. Even if you left out the electronic paper screen, wirelessness would make the Kindle a huge improvement over all previous e-book devices, because it lets you shop for books, magazines, and newspapers on the device itself and download them instantly, from practically any location where you can get a cellular signal.

The fact that Amazon has also released an iPhone app for reading Kindle editions makes it clear that the company’s long-term e-book strategy is to sell content, not gadgets. (As David Pogue puts it, “The Kindle is just the razor. The books are the blades—ka-ching!”). Going wireless was a master stroke, because …Next Page »

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Neelan Choksi says he has an “addictive personality.” That might explain why he carefully orders an orange juice at the espresso bar, while I jack up my caffeine intake with another 12-ounce latte. We’re sitting at the Espresso Vivace in South Lake Union on a quintessentially rainy Seattle afternoon in early May.

Choksi’s company, Lexcycle, has just been bought by Amazon, and he’s in town doing some house-hunting. Lexcycle (pronounced like the word “lexical”) makes the e-book reader application Stanza for the iPhone, iPod Touch, and desktop. The three-man startup is based in Austin, TX, and Portland, OR. Interestingly, Choksi says that just a year ago, he barely knew anything about the e-book industry. Let’s just say the man has gotten up to speed fast. How did he do it? It turns out Choksi has always been a remarkably fast learner, and the twists and turns of his career to date are already enough to fill a how-to book on entrepreneurship.

The story goes back to 1988-1992 when Choksi was a chemical engineering major at MIT. He was a member of the famed MIT Blackjack Team, and says he netted upwards of $100,000 for his efforts. (He says he rarely plays anymore.) After graduating, Choksi worked at Exxon Research and Engineering for four years, developing software to solve problems for refineries. He then went to business school at the University of Chicago and studied abroad at London Business School. That’s where the startup bug first bit him, and he ended up enrolling in a bunch of entrepreneurship classes. “I could not get enough,” he says.

After a six-month stint at Andersen Consulting (now Accenture), he quit to work on his first startup. He had to write a check to leave—which he could afford, thanks to blackjack—but it was well worth it. “I realized that each level above me was less and less the type of person I wanted to be,” Choksi says.

So in 1999, he joined TechTrader in Washington DC, which had been started by two of his friends from MIT. It was a business-to-business marketplace software vendor, and they raised $21 million in venture funding in the heyday of the Internet boom. “But we spent $29 million, and didn’t have the revenues to make it up,” Choksi says. What’s more, he says, “We didn’t know anything about the industry we were working with.” It was a classic dot-bomb, but Choksi got valuable experience as a “utility player,” he says, working on everything from engineering to marketing and sales.

TechTrader went under in July 2001, leaving Choksi and his team to think about what to do next. “We thought, ‘What do we know about?’” he says. The answer was software development for the Internet. Technical things like Web caching and object relational mapping, having to do with accessing scalable databases. So they bootstrapped a new company, called SolarMetric. In the early days, Choksi took odd jobs to support himself, including designing a website for a nonprofit. By 2003, the company was starting to take off, and Choksi moved back to his home state of Texas (he grew up in Corpus Christi), settling in Austin. SolarMetric grew to 13 people, never took outside financing, and was acquired by …Next Page »

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