As part of our year-end 2011/beginning of 2012 coverage, we present Part 2 of an article by Philly Tech News’ Tom Paine, which includes a roundup of 2011 happenings in the Philadelphia metro area. Tom takes a look at the Verizon Wireless (Basking Ridge) agreement with Comcast, the ups and downs at Universal Display (Ewing), and French advertising giant Publicis’ acquisition of Rosetta Marketing (Hamilton) as part of his coverage. This year-in-review will be of interest to anyone who wants to know about the vibrant tech community in the Philadelphia area which influences south Jersey. Click here to read the article on his website in its entirety.
Shortly after eBay veteran Josh Kopelman joined its board, King of Prussia-based GSI Commerce was acquired by eBay in March for $2.4 billion. GSI Commerce founder Michael Rubin ended up with a new holding company called Kynetic (in which eBay has a stake), which includes Amazon Prime competitor ShopRunner, flash sales sites Rue La La, and its sports merchandising business.
King of Prussia-based wireless technology developer InterDigtal put itself up for auction in July after Nortel’s big patent sale set off a goldrush for wireless patents, but after a huge initial bump for its stock nothing has happened yet despite rumors (that revived in December) that Google, Apple and others were looking at it. InterDigital’s stock is slightly higher on the year. Google did swallow up Motorola Mobility for $12.5 billion, although the deal awaits European regulatory approval. In addition to Moto Mobility’s wireless technology, the deal would also include its Horsham-based set-top box business, which may contribute to Google’s emerging TV strategy. Some observers still believe that Google will ditch the hardware manufacturing part of the business some time after the deal is approved.
French advertising giant Publicis expanded its digital marketing presence by acquiring Hamilton, NJ-based Rosetta Marketing for $575 million in May. Later in the year Publicis reorganized its health marketing business , combining Philly-based Digitas Health and Razorfish Health and some other Publicis units based in Yardley under its New York-based Publicis Healthcare Communications Group. Digitas Health co-founder David Kramer retired. Rosetta, which also has a sizable healthcare presence, remains independent within Publicis.
Boston-based OpenView Ventures Partners made a big splash into the Philly VC scene, investing $10 million plus in each of three area ventures: Monetate, NextDocs and Xtium. Gabriel Weinberg’s solo startup, search engine DuckDuckGo, gained significant publicity and traffic and a subsequent $3 million funding round led by prominent New York VC firm Union Square Ventures.
“Internet Of Things” startup ThingWorx of Exton raised $5 million from Safeguard Scientifics, and Lancaster-based appMobi, which grew out of streaming radio app FlyCast, emerged as a significant player with its HTML5-based mobile app development platform. RJMetrics, which at the beginning of 2011 moved from Camden into larger Center City offices, announced at the end of the year they were expanding again into even larger Center City offices.
Some ventures left town: genome analysis startup BioNanomatrix (now BioNano Genomics) moved its headquarters from Philly to San Diego after raising $23 million, though they still have some staff here. Coursekit, which started at Penn, got funded and moved to New York, and two brothers both moved their startups: PlaySay founder Ryan Meinzer got funding and moved to DC, while CityRyde co-founders Timothy Ericson and Jason Meinzer got funded and moved the company, which has been renamed Zagster, to Cambridge, MA. Unified Communcations provider Alteva was acquired by a small New York state telco, although the bulk of Alteva’s business remains in Philly for now.
VC fundraising (the amount raised by VC firms nationwide) hit its lowest level in eight years in the third quarter of 2011, although some say those numbers don’t fully account for increased seed and angel funding. But sounding a note of caution, First Round’s Capital’s Kopelman recently said, “I think 2012 will look more like 2008 than 2011″.
Teen social network myYearbook, which was backed by First Round, was acquired by Quepasa for $100 million, mostly in Quepasa stock. The combined company, based in New Hope, looks more like myYearbook than Quepasa, but it does give the company a publicly traded stock vehicle. Other significant exits in the area during the year included Safeguard portfolio company Portico Systems (McKesson, $90 million), Sashi Reddi’s AppLabs (CSC), and MobileMD (Malvern-based Siemens Healthcare).
Philly Startup Leaders got a revived sense of direction when Dell Boomi’s Bob Moul was named President. Moul, along with Rick Nucci, led Boomi’s growth and its acquisition late last year by Dell, which has made Boomi a centerpiece of its Cloud strategy. Now having left Dell, Moul has immersed himself in the Philly startup scene. DreamIt Ventures started a New York program, but despite some concerns its Philly program seemed as strong as ever this year, and with Comcast’s help it was able to bring five minority-founded ventures into its 2011 class. A new business accelerator, Novotorium, launched late this year in Langhorne. And Philadelphia Media Network’s Project Liberty aims to be an incubator for new media startups. Technically Philly’s Philly Tech Week drew a big response, as have the monthly demo sessions held by Philly Tech Meetup. And New Jersey Tech Weekly, a new website covering the Garden State, added to the area’s tech coverage.
Yardley-based Journal Register CEO John Paton’s “Digital First” strategy was credited with turning around that troubled chain, and he went on to head up the larger MediaNews chain. Philadelphia Media Network’s Droid tablet introduction appears to have fizzled out, however. Comcast, as one of its commitments growing out of the NBCU joint venture deal to team up with some non-profit local news organizations, entered into a working relationship with WHYY