News from Valhalla January 2012 - Volume 16

From the Partnership

Valhalla Partners


Happy New Year from the partnership. We are looking forward to 2012, which began with our second annual StorageFest event. Art Marks discusses the big changes in IT and how they will affect innovation in 2012. Kiran Hebbar and Duncan McCall give their respective points of view on PlaceIQ, our new location-based portfolio company.

As always, we welcome your comments and questions. Please email to

Farah Giga: StorageFest II - Valhalla Partners Next-Generation Infrastructure Event in New York City, January 10

Farah Giga

After an overwhelming response to our first StorageFest in January 2011 in Palo Alto, we did it again! Valhalla StorageFest II was held at Sparks Steakhouse in New York City and drew 60 attendees from key players in the storage and next-generation infrastructure industry for a spirited discussion of Big Data, the "voice of the infrastructure customer," and building quality of service at affordable cost in storage systems.

We were very pleased with the turnout from our companies, colleagues and friends in the storage ecosystem. We were looking for a fun and educational evening and we got both. There were great comments about the event using hashtag #storagefest on Twitter, including this from Dave Vellante of Wikibon:

Thinking about . Best small event I've attended in a while. Practitioners, VC's, BoD's, entrepreneurs and pundits.

Perhaps the highlight of the evening was a dialog between execs from companies like Goldman Sachs, NASCAR, GE, Turner Broadcasting, and investors, vendors, and analysts. A StorageFest guest, CTO of an online analytics firm and Big Data expert, led the discussion and drew out the audience into a spirited exchange.

There were differing views among the participants on issues such as what constitutes Big Data and what the needs of the various sectors are or will be. Think about the difference between a 3D movie in digital format, the test data for a jet turbine, and details of customer interactions with a website. But everyone agreed that we have only seen the beginning of what will be an explosion of data in the coming years, and that addressing the needs of Big Data users will be the biggest story in storage for the foreseeable future.

StorageFest IIWe conceived the event as an intimate gathering where players from different parts of the ecosystem -- customers, OEMs, startup vendors, investors, analysts, and Big Data users of storage systems -- could meet for an evening and discuss broad topics for the industry. The caliber of the attendees and the overwhelming response to our invitation makes us confident that it will emerge as a "must-attend" infrastructure industry event.

We try to keep the group to a manageable number so that there is good interaction, but we are always looking for new participants. So if you or someone you know wants to come to StorageFest III, please call or email and let us know. We'll try to fit you in.

To find out more about StorageFest II, please look here , visit our Facebook page , or search for #storagefest.

Art Marks: The Tidal Wave in IT Then and Now

Art Marks

The transition to cloud-based IT providing computer and storage power to smartphones, tablets, and PCs is as profound a change as I've seen in how computing is done. And every time computing changes -- from mainframe to client-server to Web applications to cloud -- there are opportunities to build new, great companies.

Before I got into the venture business, I worked for General Electric. In the late '70's, because I knew a bit about technology, I became a "computer expert" and GE sent me to run its time-sharing business, GE Information Services, or GEIS. Around 1980, GEIS had a strategic planning session to discuss what the limits were on our growth, and from our frame of reference, we came up with:

1. There needed to be more people trained in how to use our computers/ services.
2. We needed more access points where our computers could be reached via local dial up.
3. If we added more types of software applications, more users would find our services valuable.

Today's cloud/mobile/wireless environment will probably solve all of those problems we were worried about in 1980:

1. We don't need to train people how to use computers anymore because we are training computers (via gestures, voice, touch) to interact with humans. This is not a "consumer"-led revolution, by the way; it is a user-led revolution.
2. We don't need to worry about points of presence. Wireless makes access to computing nearly omnipresent.
3. Simplifying applications and improving the user interface is now a requirement not just for games and social interaction, but for enterprise IT as well. And enterprise IT isn't fighting new devices any longer! Employee owned devices are a great way to lower the cost of deployment (if they can solve the security problems...)

There has never been a better time to innovate in IT. There are innumerable opportunities.

Those are my thoughts, but, of course, we are always interested in hearing yours.

Kiran Hebbar: Introducing our newest portfolio company, PlaceIQ

Kiran Hebbar

PlaceIQ divides the whole world into 100-square meter "tiles" and takes advantage of the presence of a user in a tile as an opportunity for targeted advertising in a privacy friendly manner.

This is a great opportunity. At Valhalla we have been looking for attractive investments in the area of location-based technology for some time, and we are very pleased about PlaceIQ.

Most of the "location-based services" startups of the past few years have been oriented around direct response from mobile users based on their location: the by-now-old story about the "10% discount coupon as you pass a Starbucks".

What PlaceIQ does is infer attributes of a person who is in a particular "tile" at a particular time. A late-night user in an "entertainment district" tile may be a good target for a food offer.

This kind of attribute-driven approach enables direct response, branding, and other forms of advertising based on the location as the most important input, just as the page which an online user is browsing can be used to target brand advertising, to present a contextually relevant offer, or to enable other monetization plays in ways we haven't invented yet. PlaceIQ remains relevant regardless of the "payload".

It is important to mention that PlaceIQ targets advertisements in a privacy friendly manner. Unlike the vast majority of "behaviorally targeted" advertising companies, they do not drop cookies on users' devices for the purpose of targeting. In a world where user privacy is increasingly becoming sacrosanct, PlaceIQ provides a differentiated solution which targets users based on their location and not their behavior.

In addition, we like the differentiation that comes from their huge and evolving database of location properties and the various insights they can draw through their proprietary Big Data algorithms. Over time, it's the metadata surrounding these locations that will keep competitors or substitutes from achieving the same level of performance as PlaceIQ.

Valhalla CEOs: Duncan McCall

Duncan McCall
CEO and Founder of PlaceIQ

How did you get the idea for PlaceIQ, and what convinced you it was a winner?

I'd been in and around the 'location' or 'geo' space for quite some time. With a background in web technologies and enterprise software, I was fascinated by the impact that the location-aware revolution would have on the digital space.

The fundamental idea behind PlaceIQ was to analyze and extract actionable intelligence from large amounts of this new data, and by doing so enable an understanding of a hyperlocal location, down to a city block -- like never before; the attributes of the location, the people, businesses, social / digital busyness, sentiment, products, intent etc... and how do these change over time.

The resulting product would empower advertisers, marketers and more to connect the right message with the right location at the right time, in a privacy-friendly and scalable way.

You're a return entrepreneur. What did you learn from IS Solutions Inc. that's serving you in good stead at PlaceIQ?

I've been in and around startups now for longer than seems sensible! I am not sure any of my insights will be ground-breaking but for me personally a few of the important lessons are:

  • You have to do something you utterly believe in and are extremely passionate about. It takes so much energy, commitment and blind faith, that building a business around a concept you don't believe in with every fiber of your being often ends up causing challenges.
  • Never give up. If you truly believe in your business, during the early stages you will undoubtedly face untold rejection and ridicule from potential customers, investors and partners. The ability to constantly look past this rejection, or counter it when appropriate - take whatever learning you can from it -- and keep making positive progress, is key.
  • Relationships are hugely important. Building a network that believes in you and can truly support you when needed is easier said than done. It requires more than a nice call or a beer at a conference, but the ability to really put yourself on the line for others that you believe in too, and over time this can be a critical asset for your business, especially if you have an enterprise focus.

What will location intelligence look like in 2 years? In 10?

I believe that two years from now the intersection of location with digital technologies will become a pervasive element within our digital lives. While it will still be early in true mass adoption, intelligent advertising that encompasses digital billboards, mobile, and online, perhaps even IPTV will start to be more commonplace. New cars will have location technologies built in as standard -- beyond basic navigation to intelligent routing, tracking and traffic optimization -- that will interface seamlessly with a smartphone.

Ten years is a long time to predict in tech, but I believe by then we will to some extent take for granted our location aware digital world. Location will be truly a persistent intelligent element in digital technologies. We will find it difficult to imagine that you couldn't know where all your family members were in real time, or that people used to lose their cars in car parks. Mobile advertising (hopefully!) will have evolved to relevant personalized permission based marketing -- where users only see advertisements or messages that are relevant at a certain time and place.

Portfolio News

New Investments

PlaceIQ, Inc.

placeiq logoPlaceIQ, Inc., Boulder, CO

On November 1, 2011 the Partnership and USVP co-led a $4.2 million Series A financing for PlaceIQ, Inc., with the Partnership contributing $0.92 million. PlaceIQ is a digital media company which provides differentiated hyper-local data for mobile and online advertising.


custora logoCustora, Brooklyn, NY

Custora, which launched in February, has raised $850,000 in funding from Valhalla Partners, SV Angel, Founder Collective, Highline Venture Partners, Paul Buchheict, Sam Altman, the Start Fund, and other angel investors.
Custora, a customer retention SaaS, helps retailers keep customers and tailor actions based on individual-level insights.

Q & A

We want, as much as possible, to open up our newsletter to questions, opinions, and suggestions from our readers. The great magic of our newest medium for communication is its interactivity.

Please click here to submit feedback. We will undertake to respond to every submission, and to print those of general interest in this section. The partnership is happy to address topics such as hot technologies, exit strategies, or due diligence. We look forward to hearing from you.

The Valhalla Team

Investment Staff

Charles Curran
General Partner
Harry D'Andrea
General Partner
Farah Giga
Dan Gordon
Director of Research
Kevin Greene
Kiran Hebbar
General Partner
Hooks Johnston
General Partner
Art Marks
Managing General Partner
Gene Riechers
Senior Advisor

Administrative Staff

Claudia Bartz
Executive Assistant,
Office Manager
Sara Endicott
Executive Assistant
Bibiana Speroni
Executive Assistant,
Finance and Research

We want, as much as we can, to open up our newsletter to questions, opinions, and suggestions from our readers. The great magic of our newest medium for communication is its interactivity.

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