The Seattle Times: Brier Dudley's Blog

Seattle's Tableau goes from bedroom startup to Wall Street darling

Fri, 17 May 2013 18:53:56 PDT

Tableau Software isn’t a rags to riches story, but it’s close.

The data-visualization company burst onto the public markets Friday with a steller public offering, jumping 64 percent to close at $50.75, up from its initial $31 price.

Nearly 100 employees were in New York to celebrate while parties were held at its offices, including its headquarters in Fremont.

Ten years earlier the future wasn’t so clear, though Chief Executive Christian Chabot always believed he was building what would become a large, public and independent software company.

“We’ve really been marching against that goal, never getting too obsessed with short-term results,” he said.

The company was spun out of Stanford in 2003 and moved to Seattle in its first year, operating from a bedroom in Chabot’s Capitol Hill home before expanding into his basement.

Chabot, a 41-year-old former venture capitalist, said the move to Seattle was key to Tableau’s success.

“That has been one of the best decisions we’ve ever made,” he said. “We did it for personal reasons not financial reasons but it’s turned out fantastically.”

Chabot believes that the area’s “exceptional” talent pool will support the company’s continued growth in the area. The company now employs just under 900 and could be in the “high thousands” five years from now, Chabot said.

“Success builds on success,” he said. “More people start to move to the city, the universities adjust …. People spin out of companies.”

That success won’t be immediately obvious to Chabot’s neighbors. He doesn’t plan to buy a new house and he still drives a mini-van.

After ringing the bell at the New York Stock Exchange (he's in the light suit above) to begin trading of Tableau - with the ticker “DATA” - and spending the day talking to reporters, he was heading Friday night to a relatively low key cocktail party with employees.

“Nothing too fancy - toasts and wine,” he said.

Yet his jubilance was apparent via cellphone and across the country.

“We feel fantastic about the outcome,” he said.

It’s about more than raising capital.

“Our primary motivation for bringing Tableau public on the New York Stock Exchange today is to increase the awareness and the credibility of the company,” he said, adding that the warm reception and IPO publicity will “really help us take our business to the next level.”

Chabot’s breakout will no doubt inspire other entrepreneurs, particularly those building business software companies. His message to them to “stick with it,” even if they feel overlooked.

“For better or worse people, publications tend to write about the big goliath of technology. I don’t blame them for that. They cover Facebook and Google and Microsoft and Oracle or whatnot,” Chabot said. “The rest of us are working on an opportunity that is equally important but is going to take a longer period of time to be successful.”

How did Chabot and Tableau’s co-founders know they could take their idea all the way? Chabot said that wasn’t the focus - they saw the bigger opportunity for the tools they were building, versus a startup they could take pulic and cash in.

“We weren’t looking for one that fit that profile,” he said. “The three of us, the three founders, we believed in the mission - to help people see and understand data. I was one that we viewed as a big problem.”

Tableau’s helping customers small and large with that problem by offering software that makes it easier to visualize and analyze the information contained in databases.

It’s a hot market, with the business world awash in information and constantly searching for better ways to understand, monitor and explain what’s happening.

Tableau’s ongoing success won’t be easy. Other companies offer similar tools and business software giants such as Microsoft and Google are adding better visualization and analysis tools to their products, which could reduce demand for standalone products like Tableau.

Chabot said customers like Tableau’s autonomy.

“Customers really like the fact that we’re able to connect to the data sources regardless of the vendor - we’re kind of a Swiss army knife for data,” he said, adding that “we bring a lot of value to customers by connecting to all the world’s data.”

Yet there’s still a chance that Tableau will be acquired by one of those Goliaths, especially as competition grows between the business computing platforms of Microsoft, Google, Amazon.com and others.

Tableau’s tools - which make it easy for everyone from the receptionist to the chief executive to analyze data - seem like a natural addition to stack of enterprise software that needs better and more attractive tools on users’ desktops.

Chabot acknowledged that Tableau could still get scooped up.

“There’s always a chance,” he said. “We would do it if it’s the right thing for people and customers.”

But now the big players would have to pay $5 billion instead of $500 million to acquire Tableau.

Then we’ll have a rags to unfathomable riches story.

SquareHub debuts private Facebook for families

Thu, 16 May 2013 20:16:05 PDT

Whether or not Dave Cotter's new venture takes off, he has a future in fund raising.

Cotter lined up a remarkable team of investors behind SquareHub, a new private networking service for families called SquareHub. The service provides messaging, status updates, a shared calendar and photo sharing through a free iPhone app that became available this week.

Cotter, a former Amazon.com manager and co-founder of Seattle's AdXpose, had personal motivations. He needed a better tool to stay in touch and coordinate schedules with his children and ex-wife.

"Especially with our teens and ‘tweens, we noticed that the more gadgets family members had and the more networks we used, the harder it was to stay coordinated and emotionally connected,” he said in a release. "Facebook is too noisy and public. Our kids rarely use email, and filtering out the important stuff from hundreds of text messages was too cumbersome."

Co-founders -- who together have nine kids -- include Gilles Anquetil, an Apple veteran and former chief executive of MotionBridge; Barry Chu, former vice president at BlueKai and Medio; and Bruno Botnivik, former MotionBridge chief technology officer and Bing mobile lead developer.

SquareHub works primarily on iPhones but can also send messages to other devices via email or SMS. It also works with an iPod Touch or iPad, and the company plans to release an Android version of its app this summer.

The Seattle-based company raised $650,000 from investors, who can presumably throw more into the pot if necessary.

Backers include former T-Mobile marketing chief Cole Brodman, Isilon founder Sujal Patel, investor Geoff Entress and aQuantive co-founder Mike Galgon. Plus some of the top executives at Amazon.com, including senior vice presidents Jeff Wilke and Brian Valentine; Kindle Vice President Ian Freed; App Store VP Mike George; and development manager Prakash Bulusu.

"Today’s families are bombarded by demands that push them apart,” Brodman said in a release. "While mobile technology makes it easy to connect with a lot of people during the day, it has never really tackled the problem of bringing the most important people closer together — your family."

Here's Cotter providing a demonstration:

Video game sales freeze ahead of console reboot

Thu, 16 May 2013 19:01:07 PDT

Gamers are apparently saving up for the new Xbox and PlayStation consoles coming out later this year.

Sales of current game hardware and game discs plunged again last month, dropping 25 percent in the U.S., according to NPD's monthly report.

Yearly comparisons are difficult because the Easter holiday was in a different month this year, NPD said, but game sales have stunk either way. The current generation of game consoles has nearly ended, and players are increasingly spending their time and money playing cheaper games on mobile devices.

In this period of limbo, hardware sales fell 42 percent to $109.5 million in April, down from $187.8 million the year before. Players spent more on accessories than new game consoles last month.

Xbox was the top-selling hardware platform for the 21st month in a row, NPD said, selling 130,000 consoles.

Sales of game software fell 17 percent to $254.3 million and accessory sales were down 19 percent, to $131.4 million.

Nintendo is doing particularly well selling games for its 3DS handheld, with sales of Nintendo-produced games up 52 percent to 2.1 million units last month, the company said in a release.

Here are the top selling games last month:

Injustice: Gods Among Us (360, PS3, NWU)

Dead Island: Riptide (360, PS3, PC)

Bioshock Infinite (360, PS3, PC)

Call of Duty: Black Ops II (360, PS3, PC, NWU)

Defiance (360, PS3, PC)

Luigi's Mansion: Dark Moon (3DS)

NBA 2K13 (360, PS3, WII, NWU, PSP, PC)

Skylanders Giants (WII, 360, PS3, 3DS, NWU)

Lego City Undercover: The Chase Begins (3DS)

MLB 13: The Show (PS3, Vita)

Step aside, Slim: Bill Gates once again world's richest

Fri, 17 May 2013 10:35:48 PDT

Watch for fireworks along the shore in Medina tonight, or at least the fizz from a celebratory soda.

Bill Gates today reclaimed his crown as the world's richest man after six years in second place behind Mexican phone tycoon Carlos Slim.

Microsoft stock today closed over $34, pushing the estimated wealth of Gates to $72.7 billion, according to the Bloomberg Billionaire Index.

That pulled Gates ahead of Slim, who is now worth only $72.1 billion, according to Bloomberg's tally. Gates hasn't held the top spot since 2007, it reported.

The news comes on the final day of the Microsoft CEO Summit, which annually draws many of the world's richest executives to the area. It should give them something besides technology to discuss over their asparagus, salmon and Champagne.

Tableau ups offering price to $31, trading begins Friday

Thu, 16 May 2013 19:01:07 PDT

It looks like Fremont-based Tableau Software's stock will begin trading on Friday, with the excellent ticker symbol DATA.

Tableau and its bankers are visualizing lots of investor interest. Today they upped the estimated initial selling price of the company's stock to $28 to $30, up from the $23 to $26 estimate that Tableau released on May 6.

UPDATE: They upped it again today, fixing the opening price at $31.

At $30, the offering would raise $248.4 million, according to the updated S1 report the company filed with the SEC. Tableau expects to net $132.3 million, if the stock is priced at $29. It will trade on the New York Stock Exchange, and Goldman Sachs and Morgan Stanley are the lead underwriters.

Tableau sells software tools and services that companies use to visualize and analyze data. It began with technology developed at Stanford University with research funded by the military and spun into a company in 2003.

The company has been on a tear lately, with sales of $127.7 million last year, up from $34 million in 2010. It's been investing heavily, increasing research and development spending to $2.1 million last year, up from $628,000 the year before. Profit was $1.4 million last year, down from $3.4 million the year before.

Several financial news sites are reporting that the stock will begin trading Friday, after its offering price is finalized Thursday.

After analyzing this data, I'm visualizing lots of tech types Friday afternoon at Fremont Brewing. Or maybe across the canal at Canlis, depending on how things turn out.

Apptio raises $45 million, primed for IPO

Wed, 15 May 2013 17:31:07 PDT

Today's forecast for Bellevue: Cloudy with showers of cash, raining down on business software startup Apptio.

Apptio today is announcing that it has raised a whopping $45 million, ending a relatively quiet period in the funding of Seattle-area startups.

The funding will be used mostly to expand distribution of its products and increase professional services that it provides to customers. It's also planning to expand overseas, increasing its presence in Europe and establishing itself in Asia.

Founders of the company have said they intend to build Apptio into a major, independent company in the region, rather than cash in quickly by selling to a larger company as they did previously with iConclude. That venture sold to Opsware in 2007 for $60 million, two years after it started.

"We are really intent on building a long-lasting company that changes the way IT is managed," Apptio co-founder and Chief Financial Officer Kurt Shintaffer said.

The company now has plenty of money to run until it goes public. Shintaffer acknowledged that's a likely outcome, saying the company would go public if that presents "an opportunity to drive more growth." But he wouldn't say when an initial public offering may happen.

Pressure to go public could come from investors, including big investment groups leading the latest round of funding. They include Janus Capital, Fidelity and The Hillman Company, along with previous investors such as Madrona Venture Group, Andreessen Horowitz, Greylock Partners, Shasta Ventures and T. Rowe Price Associates.

That lineup probably won't have the patience to slowly and steadily build a private software company without the pop of an IPO or merger.

"Clearly the set of investors we're working with here are investors who invest primarily in public companies so clearly that dynamic suggests something about what the investors think our potential outcome could be," Shintaffer said.

Altogether Apptio has raised $136 million since it was started in 2007 by veterans of the enterprise software space with a knack for building companies that ride trends in corporate computing. Apptio builds tools that managers at big companies use to manage and analyze their technology investments.

Apptio calls itself the leading provider of "technology business management" products, which companies are using to keep track of their software, hardware and services as they evolve and blend on-site technology with online technologies.

"In the midst of this services transformation, TBM is a must-have set of business management applications and analytics for Global 2000 enterprises," Apptio founder and Chief Executive Sunny Gupta said in a release.

So far Apptio only has about 125 customers but they are big ones -- 29 of the Fortune 100, including Boeing, Target, Xerox, Safeway and Royal Bank of Scotland.

Apptio isn't disclosing sales other than to say they nearly doubled last year. Employment has soared, from 115 at the end of 2010 to about 350, including 220 at its headquarters in downtown Bellevue.

With the funding in hand, employment should grow to 450 or 500 people over the next year, according to Shintaffer.

Here's a screenshot of an Apptio console window:

Washington tech pay averages $110k, third highest in U.S.

Wed, 15 May 2013 11:06:12 PDT

No wonder Boeing is moving tech jobs from Seattle to the Midwest and South - tech workers in Washington are among the highest paid in the country, according to a new national report.

The 191,000 tech workers in Washington earned an average of $110,200 last year, the third highest average in the nation, according to the latest edition of the Cyberstates survey released today by the TechAmerica Foundation. That's up 0.3 percent from the average wage in 2011.

The survey also reported that Washington added 2,100 tech jobs last year, and it has one of the highest concentrations of tech work in the country, with 8.2 percent of the private sector in tech.

States with the biggest gains in tech work last year were California, up 17,700 jobs, followed by Texas with a gain of 10,000 and New York, up 6,200.

Wages for tech workers are 125 percent more than the average earned by everyone else in Washington. That's the second highest wage differential in the nation, trailing California where tech workers earn 131 percent of the average, or $123,900 on average.

"Washington’s tech industry benefits from its strong tech cluster in software services. In fact, Washington has the most software publisher employees in the nation with 51,700 workers," Matthew Kazmierczak, the survey author, said in a release.

Oregon had 6.1 percent of its workers in tech last year, earning an average of $94,200. Idaho had 6 percent of its workers in tech, earning an average of $76,500.

The Seattle Times reported Friday that Boeing is cutting 1,500 tech jobs in Seattle and moving them to Missouri and South Carolina. In Missouri, tech wages averaged $80,800 last year. South Carolina's tech wages averaged $68,400.

Nationally the industry grew 1.1 percent last year, adding 67,400 jobs last year, and now totals 5.95 million workers. Average wages across the country are $93,800, versus $47,700 for the average private-sector worker, according to the survey. It's total payroll was $558 billion last year, accounting for 10.8 percent of private sector wages.

So study your math and science, children.

Video: "Bill Gates 2.0" on ending diseases, saving kids, Leonardo and Jobs

Tue, 14 May 2013 10:56:08 PDT

He didn't get the full hour, but Bill Gates was the highlight of last night's episode of "60 Minutes."

The CBS news show presented a wide-ranging feature on Gates and his role as the world's most generous philanthropist, with footage from Africa to Seattle and candid interviews with Bill and Melinda Gates and Bill Gates Sr., mostly covering ways the foundation they run is working to improve the lives of billions of people around the world.

"You realize how crazy it is that with the world being rich enough to afford all sorts of frivolous things that those basic things still aren't being provided," Gates told host Charlie Rose.

Multiple interviews were done by Rose in Seattle, including sessions at the Gates Foundation in Seattle, Intellectual Ventures in Bellevue and the private office that Gates has in Kirkland.

At Intellectual Ventures, Gates showed off a "super Thermos" that keeps vaccines cold for 50 days without using electricity. In Kirkland, Gates showed Rose part of Leonardo da Vinci's Codex Leicester, the manuscript that Gates bought for $31 million in 1994, exploring turbulence.

Rose at one point said he'd heard Gates may be the most influential person in the 21st century, then closed with snippets of Gates on stage with Steve Jobs in 2007.

How does Gates find time, Rose asked, to run the foundation, raise his family and serve as Microsoft chairman?

"I don't mow the lawn," Gates said.

Here's the feature:

http://youtu.be/rBMXRmiEPII

Review: Car2Go handy but limited and pricey

Tue, 14 May 2013 17:01:05 PDT

It’s not often that the physical manifestation of an app or Web service appears on the curb in front of your house.

But that’s how I look at the hundreds of funny little Car2Go vehicles that have appeared on the streets of Seattle like a swarm of blue and white ladybugs.

The service — which began in Germany in 2008 and in Seattle in December — scatters a fleet of cars on the road, then lets people rent them by the minute.

Car2Go requires a $35 registration fee. It collects credit-card details and then mails an access card.

Cars can be found and reserved using a smartphone or browser. Rentals are activated by waving the access card over a sensor on the windshield. That unlocks the door and starts the rental period.

Keys are inside, along with a credit card to refuel if necessary. Gas and parking — even at meters throughout Seattle — are included in the 38 cents per minute rental price. Hourly rentals are $14 and daily rentals are $73.

I’ve been testing the service for several months, mostly using free minutes that the company was giving away at a Seattle Center event in March.

Overall it’s been a handy addition to the mix of transportation options I use. I’m glad to have the service available, especially for one-way trips downtown.

It’s also fun to “find” a car on the street, take it for a spin and just leave it somewhere else in town. This is almost like a real-life version of the “Grand Theft Auto” video games, especially if you drive like crazy to minimize your per-minute charge.

I don’t buy the eco rhetoric about car-sharing services, but there’s no doubt we’ll see more traditional services such as auto rentals migrate to on-demand systems like Car2Go uses. It blends first-rate mobile apps with location services, in-vehicle displays, wireless infrastructure and reservation software, enabling 18,000 users to easily share and find 430 cars spread across 52 square miles of the city.

But Car2Go rentals ended up costing more than I expected — much more than a bus ride — and availability isn’t predictable enough to count on the service for important appointments. The cars always seem to be scarce when I need one the most, and you can reserve one only 30 minutes in advance.

I’m also concerned about the sweetheart deal Car2Go received from the city of Seattle. The city is shafting residents and businesses with aggressive parking charges and sanctimonious transportation schemes, while letting Car2Go use public-parking spaces for next to nothing.

The company is paying $1,330 per car per year for unlimited parking throughout the city, even at metered spots. A metered spot downtown might otherwise cost $10,000 per year, and private garages may charge $2,400 or more per year.

UPDATE: The city of Seattle provided more details of its arrangement with Car2Go. The company is required to provide an annual report detailing how much its cars used metered parking, based on GPS data, and pay more if they use more than $1,030 worth of metered parking. Still, the cars are exempt from some general parking restrictions - city ordinance says they can use "time-limited parking spaces or stalls without regard to the posted time."

Car2Go's fee includes $300 per year enabling its cars to park in non-metered, restricted areas, such as zones where parking is scarce and limited to residents, or near Husky Stadium on game days.

Car2Go cars aren’t continuously parked, though near my office in South Lake Union they seem to arrive in the morning and stay put until the evening commute, using up many of the scarce parking spots.

If Car2Go’s current Seattle fleet were all parked at once in metered spots, it would take up 3.4 percent of the city’s on-street, paid parking.

Car2Go is one of several short-term car rental outfits that call themselves “car sharing” services and use online services to expedite reservations. They’ve positioned themselves as environmentally friendly because they offer new options to people who use multiple modes of transportation, potentially reducing car ownership.

The concept was pioneered in Seattle by Flexcar, which in 2000 began providing hourly rentals to customers who bought yearly memberships. Flexcar merged in 2007 with rival Zipcar, which was sold earlier this year to rental giant Avis Budget Group.

Lately there’s a wave of startups offering car services via apps. Some, such as Uber and Flywheel, provide towncars and taxis on call. Others, such as Lyft and Zimride, are apps that let people rent out their personal cars or give rides in return for a “donation.”

Car2Go feels like a startup, with its modern software interface, smart use of mobile devices and groovy vibe. But it’s owned by Daimler, the huge German conglomerate that makes everything from Freightliner semis to the minuscule two-seat Smart cars used by Car2Go. Daimler is expanding Car2Go around the world; it’s now in seven countries and 17 cities.

The cars are too small to haul much more than two people, and the pause when you first press the accelerator is a little disconcerting. But they’re maneuverable and easy to park.

Cars that I used were clean, and so far every one has had the radio tuned to KEXP.

I found only two glitchy cars. One had trouble connecting wirelessly to the reservation system, making it difficult to unlock and commence the rental.

Another had to be rebooted, literally. A customer-service rep talked me through the process on the phone. You press and hold a button on the navigation/reservation system on the dashboard. Then I was booted out because I lost my reservation when the software was reset. No other cars were available nearby so I took a bus home.

Several times I flubbed the login process, forgetting to tap my card on the windshield when I left the car, or tapping too many times when I started, resulting in charges for “trips” when the car was stationary.

The bus remains a far more reliable and affordable way to get around Seattle without a car.

Using Car2Go to and from work, trips of two to three miles ranged from $4.45 to $8.02, each way, including taxes. The same trip on a bus would cost $2.50. Either option usually requires a walk of several blocks to reach a vehicle.

My commute usually takes about 10 minutes. Most people in Seattle have longer ones; their mean travel time to work is 25 minutes, according to census data. Using Car2Go to commute, they’d spend $9.50 each way.

The idea isn’t to use Car2Go for your daily drive, though. It’s on-demand transportation that’s particularly handy for people making short trips, particularly those who want another way to get around close-in neighborhoods.

Car2Go is far from a solution to Seattle’s troubling transportation challenges, and it’s not clear that it deserves a significant subsidy in the form of discounted or preferential use of public property.

But it’s a fun and impressive blend of online and offline services, and a convenient amenity for those who can afford it.

Review: Car2Go handy but limited and pricey

Tue, 14 May 2013 06:20:27 PDT