How annoying is the Web? I’m not talking about the nonstop distractions, the social-media window into human stupidity, or even the endless pop-up ads that block your view of the screen. I’m talking about the utter loss of privacy that most consumers have suffered online, yet rarely think about.

Sure, the Web is a net positive (we hope), but there are costs. When you visit any website, you leave a record of who you are, where you are, and what you looked at. That by itself might not be traceable to your specific identity, but over time, sites can track you via social media, share buttons (Facebook “likes,” even if you don’t click them or log in), check-ins, and other online activities. Companies can then show you personalized ads based on your product preferences, zip code, and history of Google searches. Worse, they can create a profile of your activities, often combined with data from public records, and sell it to other companies to do whatever they want with it.

Trying to combat all of this is a small Boston tech startup called Abine (pronounced “uh-BEAN”). Its name stands for “A Bit Is Not Enough.” The company is working to give consumers more control over their personal information on the Web. I’ve heard a fair amount about this startup over the past year, but I recently had a chance to meet co-founder Andrew Sudbury and CEO Bill Kerrigan over a beer.

The timing seems good for Abine, what with the massive flak Facebook has been taking over user privacy lately. As Sudbury points out (along with others), Facebook treats its users not as customers, but as products. Meaning that each social network member’s profile, with its likes, recommendations, and social connections, can be thought of as just part of a $100 billion machine for marketers.

“We don’t want our users to be our product,” Sudbury says. Instead, he says, consumers pay Abine to help shield them from Web tracking and other misuses of their personal information. “We want to sell privacy services,” he says. “We want to be at the point of contact between the user and the net. We want them to use the Web without worrying that all their data is flying out the door.” For example, “users think they’re going to Boston.com, but they’re really going to 10 other websites,” Sudbury says. (That’s because their browser fetches different pieces of the website from other sites—things like ads and snippets of code that let advertisers know a little bit about who each visitor is.)

So what does Abine do about it? The company makes add-ons for browsers like Internet Explorer, Firefox, and Chrome; at the moment, different pieces of its software work for different browsers. The software, called Do Not Track Plus, blocks unwanted tracking by detecting all tracking requests … Next Page »

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According to a regulatory filing posted on Tuesday, ad-privacy compliance tech company Evidon in New York amended the funding it has raised to $16.75 million—up from $12.5 million in July.  The company is backed by private equity firm Warburg Pincus. Evidon did not immediately respond to requests for more details on the funding amendment.

Evidon, founded in 2009 as Better Advertising by CEO Scott Meyer, is a provider of technology that helps brands and marketers comply with privacy laws in North America and Europe. According to prior regulatory filings, the company initially raised $11.5 million last November and is looking to raise $21 million.

Meyer was CEO of About.com from 2005 to 2008. Evidon’s directors include Jonathan Hsu, CEO of Recyclebank.

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It’s taken me a long time to figure out TRUSTe. I’ve been to their offices, which are in a swanky building on Second Street in San Francisco’s Financial District, about three times in the last 10 months. But my last story about the company was back in September 2010, when it introduced some new privacy certification services for makers of mobile apps. The oddity about TRUSTe—the thing I couldn’t get my head around, until recently—is that the organization is a for-profit business that’s paid by other companies to verify that their online privacy practices meet its standards. Most of the other bodies that do this kind of thing, like the International Organization for Standardization (ISO) or Underwriters’ Laboratories, are non-profits—as TRUSTe itself was until 2008. I couldn’t understand why anyone would trust TRUSTe, when its revenue comes from the very companies it monitors. In economics, after all, that’s called “regulatory capture.”

The tension I was sensing is real—and, in fact, TRUSTe has taken heat in the past for lax enforcement of its own privacy standards. But in the course of several conversations with TRUSTe CEO Chris Babel and president Fran Maier, I’ve come to realize that I was thinking about the company in the wrong way. It’s not really a regulatory or standards organization, and never was. It’s more akin to a Progressive Era industry association—sort of like the Better Business Bureau or the Good Housekeeping Institute—built to tackle an Internet-age problem. Its job is to dispense a virtual seal of approval, to help assure consumers that when they visit TRUSTe-certified sites, they aren’t putting their private information at risk. Once that trust is in place, the concept goes, everyone can get on with business.

It’s also wrong to think of TRUSTe as a detective bureau, full of people running around investigating consumer complaints. It does have staffers who do that, but increasingly, TRUSTe is a technology company. It’s got software that automatically generates privacy policies, software that crawls and scans websites for potential privacy holes, software that automates opt-out programs for behavioral advertising, software that can help your Web browser block tracking cookies. In fact, it’s only by automating such processes, Babel says, that TRUSTe can keep up with the Internet’s growth and make its services accessible to more companies.

TRUSTe CEO Chris Babel

“The most frustrating question I get is, ‘Oh, TRUSTe, I recognize that, you’re that non-profit that has people doing privacy certification, right?’” Babel says. “I love the fact that people have seen the seal, they know it and recognize it and trust it. But we as a company have not gotten the message out well that in terms of our technological underpinnings, we’re really more like a three-year-old startup.”

It was looking at Babel’s own professional background that finally helped me understand TRUSTe’s current mission as a for-profit company. He came to the company from VeriSign, where he managed the Secure Sockets Layer (SSL) business, selling the certificates that website owners use to encrypt communications with visitors’ browsers. That part of VeriSign has since been sold to Symantec, but under Babel’s leadership it hit the 500,000-customer mark—and he has similar ambitions for TRUSTe. “All of the same customers who were buying an SSL certificate should also have a privacy policy,” he argues.

TRUSTe has a long way to go to hit that level—it’s only got 4,500 paying customers, who represent just a sliver of the overall e-commerce market. But that’s still a big increase over the 1,800 clients that TRUSTe had when Babel came on board two years ago. With $22 million in venture funding from Accel Partners, Baseline Ventures, DAG Ventures, and Jafco Ventures, the company has been scaling up fast—it’s now got 95 employees, including 35 in sales (up from four when Babel arrived), 30 in engineering (also up from four), and 20 in support and operations. And in the last year, it has expanded way beyond its initial focus on website privacy certification, adding services in three burgeoning areas where privacy questions are gaining urgency: advertising, mobile apps and websites, and cloud computing.

“Our pitch is that you need the best privacy policy on the planet,” says Babel. “That’s as unsexy as it gets as a sales pitch. But when you place the seal on your site”—or app, or ad, or cloud service—”you tend to see your customers buying more.”

* * *

TRUSTe exists because of the constant pressure that technology places on our personal boundaries. The truth is that the more personally identifiable information or “PII” that your favorite travel site, airline, wireless carrier, newspaper, or social networking site has about you, the more customized the services and content they can offer. It’s inevitable that … Next Page »

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This post was co-authored by Rich Whalley, an associate at CBT Advisors.

What could Google do if it had access to everyone’s health data?

You’re probably already thinking a few things:

1. There’s no way I’m giving Google my personal health data.

2. Didn’t Google already try to do this with Google Health?

3. Won’t this take the “don’t” out of Google’s “don’t be evil” motto?

But bear with us. Imagine a healthcare system 10 years in the future that would make Obama proud.

I go to the doctor and find out that I’m at risk for developing type II diabetes and need to craft an effective set of measures to minimize my risk. I find out that there are multiple recommended approaches, including preventative medicines. We log in to my Google+ health data page and go through the extensive record of my diet, lifestyle, and exercise data, as well as my genome. From this, we determine how my response is likely to compare to that of the average person at risk for diabetes.

Even if Obamacare is ultimately upheld, it’s hard to imagine that the government alone is capable of unifying and analyzing all this data through the implementation of electronic health records. A better solution may come from the private sector, where all the necessary tools are already developed. As we know from Wikipedia, the most comprehensive, cost-effective data sets often come from user-generated data.

In comparison to Wikipedia, and Google+, Google Health was never positioned to gain a large enough user base. Google Health also lacked the right social tools to become popular enough to generate anything like “big data.” Google+, by contrast, will likely gain mass adoption because of the Gmail user-base and Google’s recent moves in the smart phone space. Google’s core strengths—aggregate data analytics, Web app and smartphone integration—give it the inside track to become the ultimate user-generated health resource.

The right components for the ultimate user-generated health resource.

But how to proceed? Letting it grow organically might ultimately lead to a flop the way it did with Google Health. Instead, we have a few suggestions to take on and neutralize the privacy issue and grow via a clever acquisition. That way, Google can realize its full potential as a neutral data gatherer and let its users benefit from the analysis

1. Take the “evil” out of data acquisition

Google has been in trouble in the past with privacy, and some view Google as an evil entity trying to take over the world by gaining and analyzing information on its users. Why would anyone want to give Google access to personal health details? There will always be … Next Page »

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Cambridge, MA-based Abine, an online privacy startup, said today it has raised a $5.2 million Series A financing round co-led by Atlas Venture and General Catalyst Partners. Abine, founded in 2008, is led by CEO Bill Kerrigan. The company is developing online privacy and security software for consumers.

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Whether you’re part of the Boston-Cambridge technology community, or just an interested observer, you’ve probably been to the Microsoft New England Research and Development Center (known affectionately as NERD) at least a few times in the past year. But do you know what Microsoft is actually working on there? I didn’t.

Until last week, that is, when I visited Microsoft Research New England, one of the main groups at NERD, housed near Kendall Square. The tower at One Memorial Drive rises majestically from the banks of the Charles River, but it guards its secrets closely. Jennifer Chayes, the managing director of Microsoft Research New England, which occupies the 12th floor, reveals the projects her group is working on slowly. But she does reveal them.

OK, it’s an open research lab with hundreds of visitors and collaborators from academia and industry, so secrecy isn’t the culture here—at least, not amongst the research community. But from the lab’s opening in 2008 until now, Chayes, an expert in discrete mathematics, networks, and game theory, has said very little to the technology and business media about what her teams have been working on—and what it all has to do with Microsoft’s (NASDAQ: MSFT) business. And that’s just fine, because I’m about to tell you.

Microsoft Research New England is three years old this month. Although the full-time research staff has doubled in size since inception, it’s still a fairly small operation—12 staff researchers (including deputy managing director Christian Borgs), another dozen postdocs, a half-dozen software development engineers and support staff, and any number of students and interns. Their research breaks down into six main areas—computer science (including algorithms, cryptography, machine learning and vision, and security), computational biology, economics, mathematics, networks, and social media. (Microsoft declined to say how much it has invested in the lab so far.)

It’s not a typical lineup for a Microsoft research lab, of which there are six worldwide, including the mother lab in Redmond, WA. “Our lab has gone into certain areas that haven’t been nearly as emphasized by the other [Microsoft Research labs]. Most of them are fantastically strong in mainstream computer science disciplines,” Chayes says. “One of the reasons for opening the lab here was because we wanted to help advance the state of the art at the boundaries between computer science and other fields. And Cambridge is a place—of course it’s very strong in computer science—that’s phenomenally strong in other fields.”

Take empirical economics. Susan Athey, the renowned Harvard economist (and Microsoft consultant), heads up a year-old group in the lab that’s focused on analyzing huge datasets that Microsoft has access to—things like online advertising trends and performance, search-engine user behaviors, Xbox Live networks, e-mail and instant-messaging patterns, healthcare trends, and so on. Chayes pitched the idea for the economics group to CEO Steve Ballmer in December 2009, and he said to go for it.

The group’s goal is to find patterns in databases that could make various systems more efficient. Little did they know this would lead to the lab’s first technology to become a Microsoft product. … Next Page »

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Burlington, MA-based software startup Ziptr has brought in $6.8 million in equity financing from 26 investors, an SEC filing shows. Ziptr’s website says that its software, which is in its beta version, is focused on privacy and compliance for businesses. Last October the company raised $1.5 million in a debt financing from 25 investors.

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It’s no secret that some big West Coast players have shown interest in Boston’s homegrown mobile technology lately. In the past few weeks, San Jose, CA-based eBay (NASDAQ: EBAY) has bought Where, a location-based mobile advertising and recommendations provider, and mobile payments startup Fig Card, to roll into its PayPal division.

But Boston-based Skyhook Wireless has a slightly different relationship with a Bay Area Internet giant. It’s been wrestling in court with Mountain View, CA-based search engine giant Google (NASDAQ: GOOG), around its location-finding technology for mobile phones. Skyhook has sued Google for alleged patent infringement, as well as alleged interference by Google with deals Skyhook had inked with Motorola and Samsung for devices running on Google’s Android smartphone platform. (You can read more about the lawsuits here and here.)

It looks like there’s still a long way to go for that case to be resolved—last week lawyers from both sides met before a Suffolk County Superior Court. Google’s lawyers asked for the judge to throw out the case, on the basis that Google had pre-existing agreements with device makers, in which some of its standard apps automatically collected location data. Meanwhile, Skyhook’s lawyers re-emphasized their claim that Google road-blocked Motorola and Samsung from following through on agreements to ship smartphones with Skyhook’s XPS software, which determines a user’s location using WiFi, cellular, and GPS access points.

Yesterday, the judge denied both Google’s motion to dismiss the case and for a summary judgment, court documents show. The case will now to go into full discovery to gather the necessary documents and depositions, a period that could take six months—a timetable suggested by Google lawyers last week.

So it’s a small victory for Skyhook, but its legal work is just beginning. “Their goal is to try and bleed us out and our goal is to try and make sure we get the facts brought to light,” Skyhook CEO Ted Morgan told me this week.

Meanwhile, Skyhook has been nabbing some bigger victories out of the courtroom. This week it announced that MapQuest, the San Francisco-based mapping division of AOL, will use Skyhook’s technology in an upcoming turn-by-turn navigation app for Android phones. Skyhook has inked similar deals with UberMedia, Citysearch, and Priceline over the past few months.

“In the meantime what we’re doing is going after all the top Android apps that offer location,” Morgan says. “That way we’ll get on every Android device, but it will be through the apps instead of device makers.”

Google’s and Apple’s impending appearances before a U.S. Senate committee also shed some positive light onto Skyhook’s technology, he says. Lawmakers have expressed concern over reports that Apple logs user location data on mobile devices. Google, which has claimed that … Next Page »

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The big IT event we’re running this spring, Beyond Mobile, is now just two weeks away. We’ve got a trio of big thinkers from big organizations coming in to help us grapple with our big question—namely, what comes after the current wave of smartphones and tablets? What will our computers look like, and how will they act, in the year 2021?

Today, though, we want to announce some exciting additions to the program—the leaders of three Bay Area companies who’ll give us a look at what the future holds in the three specific areas of privacy, robotics, and healthcare. And we’re also kicking off a fun Twitter contest where you, dear reader, get to be the futurist. More details on that below.

First, just as a reminder, the main dish at Beyond Mobile will be an on-stage conversation with three leading thinkers from the West Coast information technology community, including Bill Mark, vice president of the Information and Computing Sciences Division at SRI International (which is hosting the event); Dan Reed, the leader of the eXtreme Computing Group at Microsoft Research and vice president of technology policy and strategy for Microsoft overall; and Larry Smarr, the director of the California Institute of Telecommunications and Information Techology, better known as Calit2.

The organizations that these distinguished speakers lead are each charged, in their own way, with mapping the way from today’s information environments to the smarter, faster, cheaper, more pervasive forms of computing that are surely over the horizon. I got just a taste of what may be coming in an interview last week with Bill Mark, whose own research focuses on “smart spaces” where embedded sensors and processors may take over many of the communications, information-retrieval, and advisory functions mobile devices now provide (and offer many more in addition). SRI is studying how government and military leaders, educators, and businesspeople might make use of such technology, and we’ll go deeper into that—as well as similar ideas being explored at Microsoft and Calit2—at the event.

Then, as a kind of dessert after that hearty meal, we’ll hear the following short “burst” presentations:

Chris Babel, CEO of San Francisco-based TRUSTe, will talk about his organization’s efforts to ensure that publishers, software makers, and advertisers respect consumer privacy on the Web—and about the mounting privacy concerns that will need to be addressed in an era of pervasive mobile and cloud-based computing.

Trevor Blackwell, the founder of Mountain View, CA-based Anybots (and a partner at the Y Combinator venture incubator), will share his vision of the role robots will play in remote presence, teleworking, and collaboration.

Michael Nusimow, CEO and co-founder of the Y Combinator-backed startup DrChrono, will demonstrate his company’s iPad-based electronic medical record platform system for doctors, and will talk about the ways our interactions with doctors may change in a future where most health information will be cloud-based and mobile-accessible.

And we’ll be sure to leave time—as we always do at Xconomy events—for lots of audience questions and networking.

We’re doing our best to make this event affordable for all. Students can register for $10, employees of startups under three years old can register for $30, and others can register at the early-bird rate for $60 (that rate expires tonight, so act fast). But starting today, there’s an even cheaper way to attend.

We’ll be giving away three pairs of tickets to Beyond Mobile to the winners of a special contest on Twitter. All you have to do is tweet your zaniest ideas about the future of computing over the next 10 years and append the hash tag #XconPredicts. For example:

“By 2021 even robots will be collecting unemployment #XconPredicts”

We’ll keep an eye on all of the predictions you share, and we’ll pick the best ones in three separate contest sessions ending Friday May 6, Tuesday May 10, and Friday May 13. Remember, the idea here is to have a little fun and come up with futuristic predictions that include a dose of humor or hilarity, sarcasm or schadenfreude. Have at it, good luck, and see you on May 17!

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[Editor's Note: This post was co-authored with Josh Wolfe of Lux Capital]

1. The Rise of Celebrity Science

Nations, cultures, economies all get what they celebrate. Celebrate celebrities and we’ll have another generation of over-consumptive, over-indebted, overweight, underemployed citizenry. But celebrate scientists: thinkers, doers, achievers, explorers, inventors, creators and we stand a shot at restoring the very human capital that led to the rise of what made our nation great. The best way to predict the future is to invent it. So I founded the largest-ever celebration of science, the USA Science & Engineering Festival, to inspire and galvanize a force of young scientists keen to invent, explore, discover and create. 1 million participants is a good start, just 299 million to go.

2. The Rise of the IPO

Nearly a decade has passed without a blockbuster set of IPOs. Hints abound that the resurgence of an IPO market is upon us. The rise of secondary markets swapping shares of Facebook and other social-networking darlings prove there is pent-up demand and that capital is ready, willing, and able to once again fund high-flying companies that didn’t exist a few years ago and are the essential companies of tomorrow. Groupon, despite having 500 competitors and being founded only two years ago may be the fastest company in history to get to a billion dollars in revenue.

3. The Rise of the Tablet

The iPad was just the start. Samsung’s Galaxy and a slate of other touch tablets will continue seizing netbook and laptop share. When we get over the buzzword and just start calling the “cloud” the “Internet” again, people will also see that the prophecies of George Gilder and Sun’s Scott McNeely—that the network is the computer—were correct all along.

4. The Rise of Nuclear & EVs

My partners at Lux Capital always tell entrepreneurs to shave with Occam’s Razor: find the simplest solution. In energy it’s nuclear power, and the electrification of everything, including cars. Watch for just-out-of-stealth startups like Kurion that are solving … Next Page »

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“The fantastic advances in the field of electronic communication constitute a greater danger to the privacy of the individual.” 1963 quote from Supreme Court Chief Justice Earl Warren.

I moderated a panel last week for Xconomy that was focused on consumer-oriented healthcare information technology. The panel included 2 hospital chief information officers (one current, one former) and two healthcare IT company executives. The panel itself was preceded by a presentation from Dr. Kevin Patrick, a preventive medicine specialist at UC San Diego and director of the Center for Wireless and Population Health Systems at the California Institute for Telecommunications and Information Technology. Dr. Patrick talked about many things, but among them was a program he is leading that relies on Facebook to support individuals’ weight loss goals. By engaging ones friends and friends-of-friends, goes the theory, one can more effectively stay on track with a weight loss program and work to prevent the scourge of Type II diabetes, among other problems. Dr. Patrick hypothesized that this approach could work with other health-related areas beyond weight management.

In fact, there are already companies trying to cash in on this approach, including PatientsLikeMe, the Cambridge, MA-based company that supports different online communities of patients who share the same life-changing diagnoses. Such specialized communities of electronic show-and-tell may become increasingly prevalent as the era of personal genomics makes it easier and less expensive to diagnose every person’s inherent disposition to disease.

It’s an interesting time for consumers who are theoretically trying to (or being forced to) become more engaged in their own health and to take a greater role in managing their own healthcare. One of the issues oft discussed in this context is privacy and its companion, data security. There is a generally accepted view that patients worry a great deal about the privacy of their healthcare information and much effort is made to protect healthcare data security as a result. Or is it?

One of the questions I asked my panel to respond to was this: does anyone really care about privacy and security when it comes to healthcare or is that just one of those things people are supposed to say? The response from everyone on the panel was the appropriately emphatic “yes, it’s important”, but I am not sure I’m convinced. If Dr. Patrick’s patients are going to use Facebook to share healthcare information with each other, can they really care about privacy and data security? Let’s be real; Facebook is about as secure as Tiger Woods’ hotel room: pretty much anyone can get in.

Some people feel very comfortable freely discussing their … Next Page »

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What do you get when you mix a digital media and marketing entrepreneur with a banking and real estate executive? Answer: Clovr Media, a Boston company that’s officially launching today with $1.5 million in seed funding from Kepha Partners and CommonAngels.

Founded by Tom Burgess, the former CEO of Third Screen Media, and Doug Spear, the former CEO of CSpot Networks, Clovr makes a software platform that enables banks and financial institutions to reach consumers through “card-linked offers” embedded directly in Web banners, text links, and mobile and video advertisements. That means you can click on a banner ad—potentially on Facebook or anywhere on the Web, not just on a bank or credit card site—and automatically get $25 off a Canon printer at Best Buy, say, when you use your registered card to buy it. (Clovr stands for “card linked offers with virtual redemption.”)

“We’re bringing card linked offers into the digital media space,” says Burgess, Clovr’s chief executive. “We create what the banks call ‘loyalty 2.0.’”

Indeed, Clovr sits at the intersection of two broader trends: more individualized digital rewards and loyalty programs, and more transparent analytics that let advertisers track exactly how well their online campaigns are performing. Other companies working in this area include Cardlytics, Edo Interactive, and OfferIQ, which all have slightly different approaches.

Clovr says one of its differentiators is that it has broader consumer reach—its offers aren’t tied to financial website ads or a specific card. Another advantage is that its platform allows a greater number of brands—tens of thousands, Burgess says—to benefit from card-linked offers. That’s because Clovr’s offers work at the individual product level (Bic pens), not at the merchant level (Staples).

The startup’s success will depend largely on the value of its software platform for banks and advertisers. Banks need to find ways to make money through loyalty programs instead of interchange fees. Advertisers should be able to use Clovr to tell whether a banner ad on Google, say, performed better than one on Facebook—by following through all the way to the point of store purchases. Clovr charges a per-transaction fee for advertisers and splits its revenue with banks.

“We can track the user and see transactions on a credit card. We’re partnered with a bank. We know when you went through a point of sale,” Burgess says. “Advertisers see 100 percent attribution.” As for any consumers worried about privacy, Burgess says the banks will retain all private information behind their firewalls.

Clovr has eight employees plus a half-dozen developers and contractors. The company is moving from Waltham to downtown Boston this week. At this point, Burgess says, the goal is to launch the website (which is live as of today) and introduce the Clovr platform. It’s still too early to announce any retail or financial partners, he says.

Burgess sounds like an entrepreneur who never forgets where he came from—which is good, since he’s built companies that have sold to the likes of Monster.com (CollegeLink) and AOL/Time Warner (Third Screen Media). “Six or seven months ago, we were two guys and a PowerPoint,” he says. “We went back and built something. Now we’ve come back to the market.”

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Most companies might consider reining in their loftiest ambitions after an IPO plan falls far short of expectations.. Then again, most companies aren’t run by Ryan Wuerch.

Wuerch is the founder and chief executive of Bellevue, WA-based mobile software company Motricity (NASDAQ: MOTR). The company, founded in 2001, filed for its IPO in January. At the time Motricity, which had generated more than $100 million in revenue in 2008, though it was not yet profitable, was expecting to raise as much as $250 million from investors in its initial public offering.

Instead, the company, met by a tough economic climate, was forced to lower its expectations. First, it sought to raise $85 million, then $62 million, before finally settling on a much lower $50 million to seal the deal. But a less than ideal IPO, Wuerch says, isn’t enough to speak to the well-being of the company, and won’t be enough to curtail its ambitions.

“Stock price doesn’t indicate the strength of a company,” Wuerch says, adding, “We were waiting for that window.” Timing certainly didn’t help Motricity. On the last day of the company’s road show in May, just when Motricity was trying to whip up enthusiasm among dozens of investors, the Dow Jones Industrial Average fell 1,000 points in a very scary 16-minute period. The window Motricity had been waiting for was suddenly gone, but Wuerch and the company decided to move forward with its plans regardless.

“It’s a very difficult market and we feel very fortunate that we did get out,” he says. “We didn’t have to go public.”

The reasoning for moving ahead with the public offering was three-fold. First, Wuerch was eager to have transparency with the customers that comes with the territory of being public. Second, there was an obvious opportunity for the company’s some 355 employees, as of March 31, to benefit from the transaction by enabling them to potentially cash out their stock options. Third, the company had some rigorous international expansion plans in the works that required extra capital.

Ryan Wuerch

Motricity had a number of prominent stockholders going into the IPO, including Advanced Equities (28.6 percent), billionaire investor Carl Icahn (13.8 percent), Technology Crossover Ventures (10 percent), and New Enterprise Associates (9.8 percent).

Although the public offering was no doubt humbling, Wuerch says the company has already bounced back. Motricity posted revenue of $113 million in 2009. And although they haven’t yet become profitable, the company’s revenues are climbing and losses are narrowing. In 2008, the company reported a loss of $78 million. In 2009 its loss was down to $16 million.

The company is ready to move forward—and aggressively so—with plans to ramp up its local presence, and expand to Asia and India. Citing the famous children’s fable, Wuerch says actions speak louder than words. His motto around the office is “maniacal execution against the plan.”

“My largest investors actually bought in the IPO, so if there’s any indication to the strength of the company, that’s it,” he says. “It has nothing to do with how much money you’re raising.”

And so far things are looking up. The company’s second quarter results—some $30.4 million in total revenues—exceeded expectations, Wuerch says. As the domestic market has improved for Motricity, Wuerch says it has enabled him to think more about international expansion.

Motricity relocated from North Carolina to Bellevue in December 2007, coinciding with the company’s $134 million acquisition of the mobile division of Infospace. But Wuerch had other reasons … Next Page »

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I’m a day behind with our usual roundup of the previous week’s major business and technology stories from Xconomy San Francisco. So, without further ado:

—Having driven past Box.net’s cheeky anti-Microsoft billboard on U.S. 101 many times, I finally got to meet the company’s young CEO, Aaron Levie, who told me why SharePoint is a dinosaur and business collaboration software is moving to the cloud and getting more social.

—nPario, a Palo Alto, CA- and Redmond, WA-based startup using technology developed at Yahoo to track consumer behavior across Websites, social networks, mobile devices, game consoles, and other platforms, announced a major partnership with Electronic Arts. The Redwood City game giant will use nPario’s technology to help advertisers serve targeted ads to gamers and EA site visitors.

—Evri, a Paul Allen-backed semantic search company with offices in both the Seattle area and the Bay Area, rolled out several iPhone and Android apps designed to show off the company’s ability to aggregate news stories on topics like technology, celebrity gossip, and sports.

—Emeryville, CA-based Amyris Biotechnologies, which has engineered yeast strains to turn sugarcane into diesel and jet fuel, debuted on the NASDAQ exchange, raising $85 million in new capital.

—I took a close look at the “Fast Track MBA” program introduced to San Francisco this year by Massachusetts-based Babson College. Known for its entrepreneurship-oriented curriculum, the college hopes to attract mid-career technology executives, who can take part in the hybrid online/classroom program without having to leave their regular jobs.

—In my Friday column, I argued that it’s time to stop arguing about whether New York, Boston, Silicon Valley, or some other location is the best place to build a startup: today’s telecommunications technology is tying together information workers as if they all lived in one giant city.

—Truste, the San Francisco-based company that certifies the privacy policies of commercial websites, announced an expansion into the mobile realm. It rolled out new certification standards designed to assure consumers that publishers of mobile apps and mobile websites won’t misuse their location data or other personal details.

—Some major venture financing rounds came to light, among them: $21 million for Quantenna, $75 million for Chegg, $15 million for Netshelter, another $15 million for Retail Solutions, $12 million for Ongo, and $14 million for PVT Solar.

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San Francisco-based Truste, the former non-profit that provides privacy certification services for the websites of nearly 3,000 organizations, is expanding into the mobile arena. Starting today, builders of mobile websites and mobile applications can submit their sites and their iPhone, iPad, Android, Blackberry, Windows Mobile, Symbian, and Palm software apps for certification by Truste. If they pass, and they’re willing to pony up at least $3,000 per year, they’ll be entitled to use the familiar Truste certification seal on their sites or apps.

That could help combat consumers’ fears that purveyors of mobile apps are apt to misuse the extensive data they can gather on user behavior. “There is a lack of trust in mobile apps,” argues Chris Babel, Truste’s CEO. “Privacy issues around geolocation are causing consumers special concern. People are starting to say, ‘Hey, wait a minute, this app is sitting in my pocket all the time on a device that has GPS capability, and they can locate me to within 10 feet.’ That can get scary.”

That’s why Truste is updating its privacy requirements with new standards relating to location technology, mobile marketing and analytics, and other issues pertinent to mobile usage. For example, to win the Truste seal, a Starbucks or BestBuy store-finder app for iPhones or Android phones would be required to notify users the first time the app taps a phone’s GPS chip. Mobile apps are also required to notify users every time they pass location information to a third party—a coupon distributor, for example.

At the same time, Truste is overhauling the general look and feel of its policies and forms to make consumers who access the information from mobile devices feel more at home. The organization has updated its privacy seal to be more visible on mobile interfaces, and it has created short versions of the privacy policy pages explaining things like how Truste-certified sites collect and use personal data. “We’re trying to make it all mobile-friendly,” says Babel.

A few pre-release clients have already subscribed to Truste’s mobile certification program, including Apartments.com, BreastCancer.org, GoDaddy, TigerText, Thumbspeak, the Weather Channel, WebMD, WorldMate, and Yelp.

Babel argues that the $3,000 annual cost of being certified—which comes on top of any fees clients might already be paying Truste to certify their standard websites—will repay itself in the form of increased consumer confidence. Babel says that in tests on the standard Web, e-commerce companies see an uptick in sales of between 7 and 29 percent when there is a Truste seal on every page of their site, and he expects to see the same effect carry over to the mobile world. “We are charging more, but we’re saying, ‘Here’s the value we are providing,” says Babel.

Truste, which was founded in 1997 by Electronic Frontier Foundation director Lori Fena, has always charged other organizations fees for its certification services and for the use of its privacy seal. But launching new forms of certification that carry additional charges may be a higher priority for the organization today than in the past.

In July 2008, Truste became a for-profit entity and raised an undisclosed amount of venture funding from Accel Partners, which was also a major investor in … Next Page »

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This is the eighth in a series of profiles of companies funded this summer by Paul Graham’s Mountain View, CA-based startup incubator, Y Combinator.

Every day millions of people check in or submit geotagged updates using mobile-friendly services like Foursquare, Gowalla, Twitter, SCVNGR, Google Latitude, and Facebook Places, sharing their locations with the whole social-networking world. But who really needs this information? That’s a question the founders of Whereoscope had to confront almost as soon as they arrived at Paul Graham’s startup school this May.

“When we first entered Y Combinator, our idea was all about being a Google for people’s locations,” says Mick Johnson, who started the company with fellow Australian James Gregory. “We built some really cool pieces of technology, where we’d find strangers nearby, or you’d type somebody’s name into your phone and we’d tell you where they are. But the key question that Paul kept asking us was who are the users who really care about this. The answer, although it took us a little while to realize it, was that there isn’t anyone.”

Or at least, there aren’t enough people interested in the locations of random strangers to build a business around the idea. On the other hand, Johnson and Gregory, realized, there are a few key people in everyone’s lives whose locations do matter.

“I think the watershed moment was when I was chatting with my girlfriend,” Johnson recounts. “She works extremely hard, she can’t see me that often, and we don’t live together. She said it made her feel better to know where I was. I said ‘How much would you pay for a service that told you where I was?’ and she said ‘Five dollars.’ And then I said, ‘How much would you pay for a service that tells you where your kids are?’ and she said $10 a month, straight away.”

Multiply $10 per month by the millions of families with multiple smartphones, and you have a potentially interesting business. So that’s what Whereoscope built.

The startup’s first product, launched in early August, is an iPhone app that taps into the device’s GPS- and Wi-Fi-based positioning system, sending users alerts about the locations of family members whose phones are also running the app. Parents, for example, can set the app to tell them when a child arrives at or leaves a certain place, such as their school or sports practice. Users can also set the app to tell them when a family member approaches within a certain distance. If you’re cooking dinner and waiting for your spouse to get home from work, for example, Whereoscope can send you an alert when they drive across an adjustable boundary line (called a “geofence” in the location business) anywhere from 1 mile to 20 miles away.

For now, the app only works when everyone in the family has an iPhone with the latest iOS 4 operating system, which is capable of running the Whereoscope app continuously in the background. The startup is waiting for App Store approval on an updated version of the app that also works on iPads and iPod Touch devices, and Johnson says Android and BlackBerry versions are planned.

The service is free at the moment, but the company plans to experiment with fees that could range up to $10 per month per phone. That’s roughly the same price charged by AT&T’s FamilyMap, a similar service that lets users of AT&T’s cellular network locate the phones of family members on a digital map.

As of last week, 3,500 people were using the service, and the number is increasing16 percent per week on average, according to Johnson, who taught English in Japan for several years before going to work for a Sydney-based security company called Sensory Networks. That’s where he met Gregory; the two decided to strike out on their own after scoring an initial success with … Next Page »

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If you’re in the Faneuil Hall area of Boston today, look out for the trike. That would be the Google Street View Trike, a pedicab-like contraption mounted with a camera and computer equipment. It’s meant to capture 360-degree, street-level images of places where Google’s fleet of Street View cars can’t go—pedestrian malls, university campuses, parks, hiking trails, and so forth.

As my colleague Wade reported last November, Faneuil Hall was a finalist for the trike treatment, competing against Chicago’s Navy Pier and San Francisco’s Pier 39 in the pedestrian mall category (via online voting). Well, the cradle of liberty won out, and today, Google is showing up to take the pictures. They should be viewable in Google Maps sometime in the coming months, the company says. (You can read more about the nuts and bolts of the trike project in Wade’s interview with senior mechanical engineer Dan Ratner.)

Of course, it’s all great marketing for Google. But it’s also a really interesting step in the evolution of digital imaging technology, and how consumers can experience the richer details of the real world while online. And it could eventually tie into Google’s local search business.

So I decided to do a deeper dive into Google Street View, which is an ongoing project in all 50 U.S. states and dozens of countries around the world. Yesterday I spoke with the mastermind of the Street View project, engineering director Luc Vincent, who’s based in Silicon Valley.

Vincent is a renowned expert in image processing and computer vision. A native of France, he was a postdoctoral fellow at Harvard University’s Robotics Laboratory in the early 1990s before developing his career at Xerox Imaging Systems in Peabody, MA. From there, he moved out west and spent time at ScanSoft, Xerox PARC, and LizardTech, before joining Google in 2004, originally to work on Google book search.

We talked about the genesis and history of Google Street View, as well as the future of geo-search and imaging—its significance to the company, how far Google wants to go (hint: everywhere), and how it deals with privacy issues. Here are some edited highlights from our chat.

Xconomy: So how did Street View originally come about?

Luc Vincent: I worked mostly on books for the first two years. But the same day I joined Google, I was put in meetings about collaborations with Stanford to do research [on gathering images]. I turned this into a Google “20 percent” project, and found some more people to work on it. Pretty soon I was herding cats.

Larry Page himself was interested in this when I joined Google. We were not really motivated by money originally—just building compelling services. We focused on the scale. We were really willing to spend money and engineering [resources] because we thought it would be useful to people. At Google, we start small, we show demos, and we iterate.

X: What was the biggest challenge in getting the project going?

LV: There were tons of challenges. Early on, we had no funding per se. We got people to help with time and equipment. When we started with Stanford, we were working with the DARPA Grand Challenge [robotic car] team. We used [one of their cars, with a driver] to collect our first test imagery. These cars were too fancy and automated, so we drained the battery multiple times. If you drain the battery, the A/C stopped working. It was summer and we were trying to collect data, and we had … Next Page »

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Normally, we wouldn’t get too excited about a $300,000 tech startup financing in Boston. We might write a brief, or save it for a deal roundup. But today’s news that Locately, a Boston-based location analytics firm, has raised a seed round touches on several important local innovation themes and organizations. Consider the following:

—One of the key relationships in this investment deal came about thanks to Angel Boot Camp, the June event in Cambridge, MA, built around angel investing and entrepreneurship. Techie and angel investor Gabriel Weinberg writes on his blog that he hung out with Locately co-founder and chief technology officer Drew Volpe for most of Angel Boot Camp, and that this “really kicked things off.” Weinberg and three others from Hacker Angels, a recently formed group of individual investors, participated in Locately’s financing round. (I had been wondering what tangible deals have come out of Angel Boot Camp; this is Exhibit A.)

—This is the first announced investment from Project 11 Ventures, the “accelerator program” and investment fund run by former Microsoft and Eons veterans Katie Rae and Reed Sturtevant. Project 11 focuses on early-stage Internet startups, and is raising a small first fund of under $5 million, according to the Boston Globe, which has further details in a profile from last month.

—Oh yeah, so what Locately does is provide GPS-based location data from mobile phones to national brands, market researchers, and advertisers. The company says it does this in a way that protects consumer privacy. Mobile analytics and location-based advertising seems to be picking up steam, as everyone wants to figure out how to cash in on consumers’ online and offline behavior, via mobile devices.

—Last but not least, Locately (previously known as Cadio) is a finalist in the $100,000 MassChallenge startup competition. You can read all about the upcoming reality TV show here.

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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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With all the froth around big tech company earnings, device announcements, and mobile app stores, it’s refreshing to see some long-term research in computing being funded. Google announced today it has awarded $1.35 million ($900,000 up front) to the University of Washington for work on mobile data collection for public health and environmental monitoring, and $100,000 to UC San Diego, for research on energy efficiency.

The awards are part of $5.7 million in the first Google Focused Awards Grants being given to a dozen projects led by 31 professors at 10 universities in the U.S. and U.K. The areas of research also include machine learning and privacy. The grants are for two to three years, and give the recipients “access to Google tools, technologies and expertise,” according to a blog post by Alfred Spector, Google’s vice president of research and special initiatives.

The UW grant is to computer science professor (and former Intel Research Seattle director) Gaetano Borriello, in collaboration with Deborah Estrin at UCLA. (Wade and I have previously reported on the work of these two professors in wireless sensor networks.) The new grant is for researching the use of mobile phones as data collection devices for public health and environmental monitoring applications.

“Here at Google Seattle, we deeply appreciate our strong relationship with the University of Washington,” said Brian Bershad, Google Seattle’s engineering director (and former UW computer science professor), in a statement. “With this focused research award, we see an example of how that collaboration and recognition extends broadly across Google.”

Meanwhile, the UCSD grant to computer scientists Tajana Simunic Rosing, Steven Swanson, and Amin Vahdat, is for studying energy efficiency in computing. Energy efficiency has been among the topics of interest at the UC San Diego campus of Calit2, the California Institute for Telecommunications and Information Technology. Calit2 director Larry Smarr views global warming as a serious environmental threat, and has highlighted efforts at UCSD and elsewhere to make data centers and other IT operations more energy-efficient.

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