One Arrives, One Leaves at General Catalyst

The *huge* news for General Catalyst this week is that Facebook co-founder Chris Hughes is gonna do a stint at the Cambridge firm as an entrepreneur-in-residence.

But what hasn't been reported yet is that technologist-in-residence Charles Teague has just left the firm.

Teague is part of the Allaire Brothers mafia, having gone to college with Jeremy and J.J., and also worked at both Allaire Corp. and Onfolio, J.J.'s start-up that was snapped up by Microsoft. (Jeremy had served as a technologist-in-residence at GC before Teague, later going on to launch Brightcove.)

Teague won't talk about what he's up to post-GC, but I have a feeling it's iPhone-related. "I'm currently heads down on a project and I'm not quite ready to talk about it," he writes via e-mail. (General Catalyst also hasn't answered my inquiries about whether they're going to fund Teague's new venture.)

What's interesting about Teague is that, while still at GC, he and some friends created a free iPhone app for managing weight loss called Lose It. It's now the most popular app in the "Health and Fitness" category of the iPhone Store.

Not bad for a little side project...

Teague's blog, which has been very focused of late on iPhone apps, is here. So far as I know, he has never mentioned his involvement with Lose It or FitNow, Inc., the parent company set up to sell the app.

(In the photo, Teague is in the center, sandwiched between J.J. Allaire on the left and Sim Simeonov on the right.)

Panel from MIT VC Conference: Media/Tech/Entertainment

Moderated a panel earlier today on media, technology, and entertainment at the 11th annual MIT Venture Capital Conference. My panelists included:

Jeremy Allaire
CEO, Brightcove

John Lanza
IP Practice Group Leader, Choate Hall & Stewart, LLP

Lucy McQuilken
Investment Director, Intel Capital

Neil Sequeira
General Partner, General Catalyst

We talked about Facebook, Twitter, set-top boxes, Internet video, the Kindle, Blu-ray, iTunes, copyright, piracy, videogames, and the music industry.

The MP3 is about 50 minutes long. Some of the questions during the Q&A are on the quiet. The file is here.

June 19th: Discussion About Non-Competes at Harvard Law

Bijan Sabet at Spark Capital has been trying for a while to assemble an open discussion about the impact of non-compete agreements on the economy here in Massachusetts... and it looks like it has finally come together for June 19th, at Harvard Law School. An RSVP is required.

Here's the description:

The use of employee non-compete agreements by Massachusetts companies is routine, with employers mandating that employees steer clear of any business of a competitive nature once they leave their present jobs, typically for a year or more. Many believe these agreements are critical to guarding a company’s hard-earned intellectual property — protecting legitimate business interests, and thus our region’s economy. Others, however, believe that non-competes are nothing more than handcuffs that prevent talented entrepreneurs from bringing new innovations to market and, in some cases, even driving entrepreneurs to leave the region to pursue their innovations elsewhere. In this session, we’ll bring together some of the area’s best known venture capitalists, entrepreneurs and executives to explore the issue of non-competes and weigh the pros and cons of their use here in the Commonwealth. Are non-competes protecting innovation and economic growth in Massachusetts? Or stifling it?

Panelists will include:

- Jeremy Allaire, founder & CEO, Brightcove
- Melanie Haratunian, general counsel, Akamai
- Paul Maeder, general partner, Highland Capital Partners
- Lee Fleming, associate professor of business administration, Harvard University
- Bijan Sabet, general partner, Spark Capital
- Moderator: John Palfrey, Clinical Professor of Law and Executive Director of the Berkman Center for Internet & Society, Harvard Law School

Akamai CEO Paul Sagan was definitively for non-competes when I asked him about the issue last fall... not sure where Jeremy Allaire stands... but having someone from EMC, the most active enforcer of non-competes in our state, would be good. Perhaps they'll at least attend, and contribute from the audience...

Last night's MITX panel on Internet video

Last night's sold-out MITX panel, 'Internet Video: What's Next?', was a lot of fun... and a full house despite dire warnings of impending precipitation. (Which always get people in Boston agitated.)

In the audience was a big contingent of video folks from the Globe, at least one exec from Visible Measures, video analyst Will Richmond, blogger and consultant Cesar Brea, and lots of folks from PermissionTV, one of the event's sponsors.

I won't try for a comprehensive re-cap here, but we talked about three areas: how is viewing behavior changing on the Web; how are videos made and distributed, and how are they monetized and measured.

No one has yet solved the problem for the mainstream consumer of getting Internet video onto a TV. Mike Hirshland of Polaris Venture Partners said that it could wind up being the player who can most successfully do deals with cable companies -- a risky prospect for venture capitalists to bet on. He said he'd earlier invested in a company, Ucentric Systems, that tried to built a next-gen set-top box, but was about eight years too early.

The panel seemed to agree that story and content trump production values. Denise DiIanni of WGBH recalled that several years back, filmmakers working with 'Nova' resisted shooting on video and tried to stick with 16 millimeter film. But the audience didn't see the difference, and didn't care.

Hirshland said that pre-roll advertising is already dead, and that the ad formats that will win will be highly targeted, and allow the viewer to choose to engage with them, rather than forcing a viewer to sit through them.

Someone from the audience asked a great question about how Internet video will evolve. Right now, he said, we're treating it like TV -- but it'll likely turn into something different. Denise DiIanni of WGBH had a great reply, which is that Internet video allows for conversations between the creator of media and the consumer -- putting both on a level playing field.

Videoblogger Steve Garfield, sitting in the audience, showed us how he does liveblogging with his Nokia N95 cell phone. Using QIK, he streamed video while he was talking.

After the panel, I had an interesting chat with Cesar Brea, who said that an impending recession will likely force advertisers to get serious about Internet video, emphasizing solid measurement and accountability. IE, it may shift things more to a pay-per-click model, as opposed to pay-per-impression.

Finally, here are some of the clips that we showed and talked about at the start of the panel....

- Boston.com 'Office Invasion': Harmonix Music Systems

- WGBH: War Games

- Mike Hirshland's interview with Scott Kurnit

- Boston Celtics, from Boston.tv

- TMZ video of Tara Reid, hosted by Brightcove

- Dean Whitney from Digitas showed these videos, one in HD and hosted by BitGravity

Behind Yahoo's $160M Acquisition of Maven: Maven CEO and Board Member Discuss

What do you ask for in February 2008, when you sell a company to Yahoo?

Cash, baby.

Yahoo paid $160 million for Cambridge-based Maven Networks -- almost all of it in greenbacks, not Yahoo stock. (Here's the AP story...and the official press release.)

"There's no way to arbitrage Yahoo's stock price when Microsoft may be buying them, or may not be buying them," says Woody Benson, managing general partner at Prism VentureWorks, which invested in Maven's most recent round of financing. (Yahoo rebuffed Microsoft's $44 billion purchase attempt on Saturday.)

Benson told me this morning that there was more than one company interested in owning Maven, but acknowledged that he was a bit anxious about whether the deal would go ahead once Microsoft started to make a run at Yahoo: "Anxious would be one word for it," he said.

Benson said that Maven and Yahoo signed a letter of intent around Thanksgiving, and that due diligence proceeded until Microsoft made its unsolicited offer to acquire Yahoo on February 1st. Benson says that the Microsoft offer didn't necessarily cause Yahoo execs to slow down or speed up the final negotiations in the Maven deal; I'd earlier speculated that it could hang in the air for a while. The final papers were signed on Sunday.

"There's a reason why they're buying us," Maven CEO Hilmi Ozquc said, when I suggested that Yahoo (and Microsoft) had missed the boat on the online video explosion. "The tech innovation has been happening at start-ups to date. But as the giants jump in, the fastest way to get there is through acquisition."

Ozguc and Benson both say that Yahoo's big advertising salesforce will help Maven vault ahead of other video players, like Brightcove (and perhaps even put it on an even footing with YouTube, which has been slow to integrate ads with videos.)

My last question for Ozguc was whether he'd be surprised if Microsoft now bought Brightcove: "I would not be surprised," he said. "But if they're going to buy Yahoo and get Maven for free, why?"

Update: Will Richmond has a longer Q&A with Ozguc on his site, Videonuze.

The NY Times Bits blog offers a critical take on the purchase...and here's the Globe coverage of the deal.

Will Yahoo buy Maven?

(This is in danger of turning into the all-General-Catalyst-all-the-time blog...)

But the buzz yesterday was that Yahoo was on the verge of a deal to buy Cambridge's Maven Networks for about $150 million.

Wonder how that deal will be affected by Microsoft's unsolicited offer to buy Yahoo for $44 billion?

I suspect if the ink isn't yet dry on the Maven acquisition, CEO Hilmi Ozguc and his investors (which include GC, Prism VentureWorks, and Accel) may be biting their nails for a little while...

(A few months back, I wrote about the rivalry between Maven and Brightcove, Cambridge's two video delivery start-ups.)

Sunday's Globe column: Brightcove and Maven, duking it out

Today's Globe column is about the competition -- and many connections -- between Brightcove and Maven Networks, two Cambridge companies angling to become the dominant tool for media companies that publish video on the Net. (Their offices are a stone's throw from one another in Kendall Square.) From the column:

The story of Maven Networks and Brightcove, two companies that have helped shape the way media firms distribute video online, is one of unbridled competitiveness: two entrepreneurs who were once on the same team now duking it out.

Brightcove, by virtue of having raised $82 million in funding, is one of the highest-profile tech start-ups in Boston (Maven has banked $27 million). The big question is which one will wind up with the sweetest finish - either an acquisition by a big player like Microsoft or Google, or a public offering.

I actually had included Adobe in that list, as a potential acquirer, but it got snipped during editing. (Macromedia, now part of Adobe, acquired the first company that Brightcove founder Jeremy Allaire started, Allaire Corp.)

A few other interesting notes on possible exits: when Comcast bought thePlatform last year, they paid between $100 and $125 million, according to several sources. So that's the one valuation we know about in the enterprise video-publishing space. On the consumer side, we know about YouTube ($1.65 billion), and Sony's acquisition of Grouper ($65 million). (We sort of know about Vimeo, a video publishing site started as part of CollegeHumor, which Barry Diller's IAC acquired last year for a reported $20 million.)

YouTube received a grand total of $11.5 million in venture funding before it was acquired by Google. It starts to make it look as though Brightcove's backers ($82 million) may find it tough to make a 3x, 4x, 5x return. But we'll see. One intriguing possibility would be combining the two companies, since Accel Partners and General Catalyst are investors in both. Of course, they'd then confront Sophie's Choice, since I'm sure that Maven CEO Hilmi Ozguc and Allaire would never work together.

John Simon, the General Catalyst partner who sits on the board of Maven (his firm is also an investor in Brightcove), wouldn't talk to me by phone. But he sort of answered a couple questions via e-mail. I asked what he thought the benefit was of being an investor in both companies. He wrote that the "two companies ... show every sign of delighting customers, employees, and stakeholders and being very significant venture capital winners at this point," adding, "[T]hese are two companies we can really be proud of."

Here's this week's video.... an interview with Jeremy Allaire, published using (what else) Brightcove.

Solid lists of mobile and video start-ups around Boston

David Laubner runs the great local tech site 93 South. Two cool new postings there:

1. A list of video-related start-ups in the Boston area, including Brightcove, PermissionTV, Avid, and ExtendMedia. (David used to work at Gotuit, one of the video companies on this list.)

2. A list of mobile-oriented start-ups in the Boston area, which includes Enpocket, MobileLime, JumpTap, Skyhook Wireless, and the super-stealthy LocoMobile, funded by General Catalyst.

I think gaming is another area where there'slots of activity. Your next list, perhaps, David?