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Tom Siebel’s $100M big data energy startup C3 finally emerges as a player

Posted in Uncategorized, tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on February 7, 2013| Leave a Comment »

Article from GigaOM.

For years little has been known about what stealthy energy data startup C3, founded by Siebel Systems bazillionaire Tom Siebel, has actually been up to. The company has been like a Will Smith summer blockbuster that’s supposed to come out three years from now and will only hint at its plot through artsy abstract trailers. Well, turns out, school is finally out for the summer for C3 — the company has just completed some major milestones for its newly emerged big data energy product, according to Siebel during a talk at the Cleantech Investor Summit on Wednesday.

Siebel, now CEO of the four-year-old startup, said that in September 2012, C3 launched a data grid analytics project for PG&E, which crunched a whole lot of data about commercial and industrial buildings (the kind owned and leased in California by the likes of Cisco, Kaiser Permanente, Safeway and Best Buy). C3′s platform collected disparate data about a half a million buildings, from places like publicly-available data found via Google, to energy consumption data from utilities, to weather data from weather information companies.

The entire project required 28 billion rows of data (at least 8 terabytes) that C3 aggregated, normalized and loaded at 5 million records an hour said Siebel, adding, “this is really hard stuff.” PG&E used this data analytics tool to work with building owners to perform energy efficiency audits in real time for all of the commercial and industrial buildings in its footprint. It was a major success, said Siebel, and in the first few weeks of January of this year PG&E exceeded their energy auditing goal for the entire year.

C3 was also quietly involved in a more high profile big data energy project with GE, which I profiled last week when it launched at Distributech, although at the time I didn’t know C3 was involved. Siebel described the project with GE as “a joint development deal” at grid-scale, trying to solve “petabyte type of problems.” As I reported last week, GE’s Grid IQ Insight software can pull in disparate data from a variety of sources like grid sensors, utility databases and even social media sources on a per second interval basis, and utilities can use the software to peer into their grids, and combat blackouts, in real time.

Siebel says C3 has three of these types of projects live with customers, that combine a big data layer, an analytics layer and a customer presentation layer. The company plans to launch another five projects in 2013 and another five in 2014. Other customers include Entergy, Northeast Utilities, Constellation Energy, NYSEG, Integrys Energy Group, Southern California Edison, ComEd, Rochester Gas & Electric, DTE Energy, as well as GE and McKinsey.

In addition to C3′s commercial and industrial platform it built for PG&E, the company also has developed a residential energy efficiency program, which launched last week, said Siebel. The service, which is in development with Detroit Edison and Entergy, is a loyalty program that gets customers to engage in energy efficiency behaviors in exchange for coupons and points at retailers like Amazon. I’m assuming that this platform has incorporated the technology from the startup Efficiency 2.0 that C3 acquired last Spring. Mailed marketing has long been considered the cutting edge in the utility sector, and “I don’t know if we even get mail at my house,” joked Siebel.

C3 has spent four years, and on the order of $100 million, building the software platform that it is now aggressively selling to utilities and energy vendors. At its core, the C3 platforms use Cassandra for database management system, and all of the applications store all of this data in the cloud, which is a relatively new phenomenon for many utilities to deal with. The company also has some big names as directors, including former Secretary of State Condoleezza Rice, and former Senator and Secretary of Energy Spencer Abraham.

Grid analytics is a sector that is growing 24 percent a year, said Siebel, and C3 intends to be the software layer that sits on top of the grid. He compared the opportunity to “the Internet in 1993.” Siebel, who sold Siebel Systems to Oracle in 2006 for close to $6 billion, is one of the few entrepreneurs in cleantech that would know what that looks like.

Lastly, Siebel said his latest startup endeavor isn’t about saving the world from climate change or reducing carbon emissions, despite the company’s three C’s moniker, and despite the fact that that’s important. Ultimately, he says, “It’s about making money.”

Read more here.

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Connecting The Dots On eBay’s Local Shopping Strategy

Posted in Board Of Intellectual Capital, Business models, Economy, Gerbsman Partners, Investments, Market research, Strategy, tagged , , , , , , , , , on May 16, 2011| Leave a Comment »

Article from TechCrunch.

It’s no secret that eBay has been heavily investing in a local commerce strategy.

The central core of this is trying to capitalize on the $917 million online-to-offline buying market, which Forrester estimates will eventually reach $1.3 trillion (although this number seems low) and account for nearly 50% of total retail sales by 2013. Virtually every acquisition in the past year (besides the company’s $2.4 billionpurchase of GSI Commerce) has been of a company that is dabbling in local payments or linking to merchants (Milo, RedLaser, Where, FigCard). If you look closely, a clear strategy is emerging that positions eBay at the center of mobile shopping, local commerce, and payments (through PayPal). Let’s connect the dots.

Online-To-Offline and Comparison Shopping

eBay’s first foray into the local commerce arena was though the acquisition of barcode scanning mobile app RedLaser last June. RedLaser’s barcode scanning technology allows users to comparison shop on the go. Anyone can scan a barcode on an item at a store and then automatically access any eBay listings of the product on the marketplace. Sellers can also use the scanning technology to scan an item and list the product in very little time. RedLaser’s technology was quickly integrated into eBay’s dedicated iPhone and Android apps.

The company then bought Milo for $75 million, which aggregates and lists real-time in-store product inventory for over 50,000 stores across the country; featuring over 3 million products from Target, Macy’s, Best Buy, Crate & Barrel and more.

Most recently eBay integrated Milo into a few of its core products, including RedLaser. So with a single scan of a product in a store, users can see which nearby retailers have a product in store, and at what price. eBay also integrated Milo’s results into its own marketplace, allowing users to include local shopping tab in search results to check a product’s local, or in-store, availability directly from the eBay search results page.

But surfacing local product results and integrating barcode scanning only scratches the surface of local and mobile commerce and its potential. There’s no doubt that eBay is reaping the benefits of mobile commerce (the company expects to do $4 billion in mobile gross merchandise volume in 2011).

Local Payments

And eBay realizes that in order to really capitalize on local and mobile in the ecommerce experience, the company also has to be a part of the point of sale for local merchants. And eBay has a player in this race—payments giant PayPal. PayPal has been making its own small forays into local commerce and late last year launched a new version of its popular iPhone app that allows users to find businesses near their immediate location that accept PayPal as a form of payment. The feature rolled out in San Francisco initially, but we haven’t heard much about the initiative since last November.

Why? Well, scaling this feature broadly to other cities is a challenge for even a large company like PayPal. Not only do they have to find the local businesses, but PayPal has to teach them how to use their mobile apps as a payment mechanism. Wouldn’t it be much easier to acquire a company that could help PayPal and eBay do this?

Enter Where, a geo-location service and mobile advertising company that already has millions of active users across many mobile platforms. The apps show local listings for restaurants, bars, merchants, and events, and also suggests places and deals for you based on your location and past behavior. Where also offers a location-based ad network, which allows advertisers to show their mobile ads only to people near their store, or perhaps near a competitor’s store (after the user opts in to see these types of ads). Currently, more than 120,000 retailers, brands and small merchants use Where’s network daily to reach new audiences and deliver real-time foot traffic to their doorstep.

eBay of course acquired Where a few weeks ago, and housed the company within PayPal. Not only does this give PayPal much more of a reach with its payments service, but it gives eBay a platform to to enter into the the local deals market. As Where’s CEO Walt Doyle told us after the acquisition, “eBay is about connecting buyers and sellers and Where is about connecting people with places.” Ebay can now tap into connecting consumers with local businesses and can be a part of the transaction with PayPal.

PayPal also just bought mobile payments startup FigCard, a Boston-based startup that allows merchants to accept mobile payments in stores by using a simple USB device that plugs into the cash register or point-of-sale terminal. All the consumer needs is the Fig app on his or her smart phone. The connection with PayPal is that when consumers setup their payment information, they could add PayPal as a payments option and pay for goods via their mobile phone.

Eliminating the need for an actual wallet has always been a goal for PayPal, and if the company can scale FigCard’s technology (perhaps to many of those merchants using Where?); PayPal could have a stake in the mobile wallet race.

The ‘Pivot’

In the past year, it’s fair to say that eBay and PayPal have spent over $200 million on the acquisitions I mentioned above. That’s a fair chunk of change even for a company that is making billions each year.

There’s no doubt that eBay is invested heavily in this strategy and believes that the future of the company is based on both online to offline purchases, local and mobile commerce. eBay VP of engineering Dane Glasgow recently told us that one of the challenges for eBay in this strategy is being on the pulse of technology, which is constantly evolving.

But as retail evolves, eBay is shifting its business as well, and it will undoubtedly be interesting to see if the company can connect the dots with all these acquisitions and technologies to create a powerhouse in mobile and local commerce. The challenge is that some of these initiatives aren’t really that complimentary to eBay’s core marketplace and auction business.

While eBay won’t be quitting the auction business anytimesoon, the marketplace business itself isn’t growing as fast as PayPal. PayPal now represents 39 percent of eBay’s total revenue, and nearly made $1 billion in revenue for the company in the first quarter of 2011, up 23 percent from the same quarter in the previous year. Marketplaces brought in $1.5 billion, up 12 percent from the same quarter in 2010.

Pivot is a word that tends to be over-used in the tech world, but in eBay’s case that is exactly what we are witnessing—a major pivot in the company’s business model to local commerce. It’s certainly not easy for any company to “pivot,” especially one as massive as eBay. If it manages to pull this off so late in the game, it could herald a whole new era of growth for the company.

As Glasgow tells us, “it’s a new retail environment, where the convergence of online and offline are coming to life through mobile and local experiences.” Can eBay position itself fast enough to flourish in that environment?”

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Facebook Credits starting to make some real money

Posted in Uncategorized, tagged , , , , , , , , , , , , , on November 15, 2010| Leave a Comment »

Article from SFGate.

“If Facebook were a country, it would be the third largest in the world, so it figures that the social networking giant is trying to develop its own currency – Facebook Credits. Already, those credits can buy virtual goods from more than 200 applications on the Facebook platform, like special crop seeds or enhanced tractors in the otherwise free-to-play social game FarmVille. But credits have moved into the physical world as well. Last week, Safeway Stores joined Target, Best Buy and Walmart in selling Facebook Credit gift cards, just in time for them to become a stocking stuffer for the onrushing holiday shopping season. “We want Facebook Credits to be the virtual currency on Facebook,” said product marketing manager Deborah Liu for the Palo Alto firm. Analysts say Facebook Credits also have the potential to become a universal online currency that crosses both applications and country borders, not to mention a multibillion-dollar revenue source for Facebook, which takes a 30 percent cut of each transaction. Credits, for example, could be the future currency used by publishers of digital content like news and video, said analyst Atul Bagga of the investment research firm Think Equity LLC. For now, “Facebook is only taking baby steps,” Bagga said. “But you can see that Facebook Credits can go far.”

Positioned to win

Indeed, online payment systems are a key component of the main theme for the Web 2.0 Summit that begins today at the Palace Hotel in San Francisco. The convention will focus on “a battle to gain the upper hand in crucial ‘points of control’ across the Internet Economy,” entrepreneur and tech journalist John Battelle wrote earlier this year in a blog post setting up the theme for this year’s conference. And with more than 500 million active members, Facebook is already positioned to become a winner in that battle. “As Facebook Credits increases in usage, Facebook will begin to look and feel like its own economy,” said Augie Ray, a senior analyst at Forrester Research Inc. The privately held Facebook isn’t disclosing how many of its members now use Facebook Credits, which grew out of a Gift Shop feature that closed Aug. 1. Earlier this month, Wedbush Securities projected Facebook will generate more than $1 billion in sales from virtual goods this year, and approach $2 billion next year. Currently, there are more than 200 games and applications from 75 developers that accept Facebook Credits for those virtual goods, including 22 of the 25 most popular social games. On Nov. 2, Facebook signed a five-year deal with Redwood City video game giant Electronic Arts to use Facebook Credits as its exclusive payment method for its social games, such as Pet Society, Restaurant City and FIFA Superstars. That followed a similar deal earlier this year with San Francisco’s Zynga Game Network Inc., maker of popular social games like FarmVille. But there are non-game apps, such as Family Tree and Hallmark Social Calendar, that also accept Facebook Credits for virtual gifts such as digital birthday cards. And charitable organizations like Stand Up to Cancer and the anti-malaria Nothing But Nets have accepted Facebook Credits donations. The payment system could become especially important since Facebook is also pushing its Connect program to directly bridge the social network’s members with millions of other websites.

Making it easy

The system works in a way that’s similar to real-world transactions such as using a BART transit card. Facebook members use a regular credit card, PayPal account or mobile phone account to buy a certain value of Facebook Credits, starting with 15 credits for $1.50. Facebook Credits accepts payments using 15 currencies, including dollars, euros and yen. Like BART cards, which deduct fares based on the distance of travel on the system, a Facebook Credits account is charged for the value of a virtual item that in real currency might cost only a few cents each. It’s the basic concept used by Apple Inc. to sell 99-cent songs on iTunes at a time when downloading songs for free was all the rage, said Alex Rampell, chief executive officer of Trial Pay Inc. “How did Apple get everybody to pay? They just made it very easy,” said Rampell, whose Mountain View company offers an advertising system that entices social game players to try a real product like pizza or cosmetics in exchange for Facebook Credits. Indeed, Facebook’s Liu said the company sees a “sweet spot” for making a frictionless micro-payment system. The company is slowly expanding its list of developers who can “just plug into Facebook Credits” and not have to worry about creating their own payment system, she said. Social gaming is just the first industry to be affected, “but we think a number of verticals will break through,” Liu said.

Potential markets

Airline tickets or other big-ticket purchases may not be practical for Facebook Credits. But news site publishers, for example, could use Facebook Credits to get readers to buy access to an important story or a special video, Bagga said. “And music is a very social phenomenon,” he said. “There are so many industries that can have disruptions due to the social networking phenomenon.” Facebook, however, is based on the proposition that members make the network work by sharing their personal information, so it has also sparked numerous controversies over privacy. Facebook Credits might bring even more scrutiny. “As Facebook becomes a bigger part of the user’s shopping and purchasing activities as well as an even greater part of their communications activities, there’s going to be a greater focus on the part of government as to what Facebook is doing,” Ray said. Read more here. 

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