TechFlash: Seattle's Technology News

Flickr photo via Angela N.

Seattle Mayor Mike McGinn gushed at a ceremony last month in welcoming Facebook and its new engineering office to the city. But there's another way to fuel tech jobs, and it doesn't require importing Silicon Valley giants. Could the City of Seattle simply bankroll some of the startups in its own backyard?

That's the interesting approach that Portland and New York City are taking, both which have announced small angel investment funds in recent months. Of course, the idea of having a government agency participating in startup creation will send shudders up the spines of libertarians. And many venture capitalists have argued over the years that the approach is misguided.

Nonetheless, cities are doing all they can to spur entrepreneurial activity, which leads to today's poll question:

The approach of Portland and New York is rather interesting as both are working with established investment professionals.

Posting will be relatively light today on TechFlash in observance of Memorial Day. Here's a quick roundup of some of the stories we're tracking.

Cray Inc. is the maker of the world's fastest supercomputer, according to the Top 500 supercomputer list. Cray's Jaguar machine, used in climate and nuclear energy research by the Oak Ridge National Laboratory in Tennessee, can process more than 1,000 trillion calculations per second. While more than half of the fastest supercomputers are in the U.S., the BBC reports that China is quickly rising up the list. (Interactive chart here).

Apple has sold more than two million iPads in the first 60 days, with CEO Steve Jobs saying in a release that: “customers around the world are experiencing the magic of iPad, and seem to be loving it as much as we do.”

Kudzu Interactive, a profitable Atlanta startup that makes a mobile app called Snapfinger which allows users to order takeout meals at local restaurants, has landed $7 million from Norwest Venture Partners and others, reports The New York Times. Snapfinger has deals with restaurant chains such as Subway, California Pizza Kitchen and Baja Fresh, and it appears to be a direct competitor to Seattle startup Order Mapper. We first wrote about Jim Bricker's startup and iPhone app, Order Pizza, last December.

Appature has strengthened its management team, adding former Johnson & Johnson manager Mike Lamberson as director of marketing. The Seattle company -- a developer of online marketing services for healthcare companies -- also recently added Kent Corley as vice president of customer engagement and Todd Feinroth as vice president of sales.

Bonanzle has hired former Blue Nile, Expedia and Wetpaint executive Alex Berg, a move that comes a month after the online marketplace for small merchants landed $1 million in financing. Berg, the former creative director at Expedia, will lead product design, strategy and usability for the fast-growing startup.

Headline of the day comes via The New York Times: "When online grievances are met with a lawsuit."

Data centers often get described as power hogs. But hogs, cows or other livestock might actually be the power source of the future for these energy sucking facilities. Researchers at HP Labs released a paper last week at a sustainability conference in Arizona detailing how the methane gas from a 10,000 head dairy cattle farm could produce one Megawatt of electricity, enough to power a data center with 1,000 servers. Here's one of the HP researchers explaining the concept.

With cheap hydroelectric power from the Columbia River, Washington and Oregon have become hotbeds for new data centers. (Yahoo, Google, Microsoft, Facebook and others have built data centers in the region or have announced their intentions to do so). So, could that mantle shift to Iowa, Nebraska, Ohio or other states with large populations of livestock?

Microsoft's Scottsdale, Ariz., store.

Microsoft plans to open a store at the Bellevue Square mall, bringing its budding retail rivalry with Apple to its own backyard, according to building permits filed with the city.

The filings confirm a rumor reported last week by the Downtown Bellevue Network blog. The same blog reported that the existing Apple store at Bellevue Square will be moving to a larger location -- setting up a high-profile retail battle between the technology giants a short drive from Microsoft's Redmond headquarters.

Microsoft declined to comment when we contacted the company about the rumor last week, so we don't know when the store is slated to open. However, the recent flurry of permitting activity makes it look possible, if not likely, that the store could be ready in time for the upcoming holiday shopping season.

More than three weeks after a planned technology upgrade, the Northwest Multiple Listing Service continues to experience problems with a new data exchange that allows real estate brokers to post listings to their public Web sites. In a memo sent to NWMLS members Friday, the organization apologized for the ongoing data issues amid one of the busiest times in the real estate business.

"The conversion imposed a steep learning curve and included some functional flaws," the memo says. "NWMLS sincerely apologizes for the unanticipated frustration, disruption, and confusion." (Full memo below).

Details are emerging of Amazon.com's next Kindle. Bloomberg reports today that Amazon will introduce the next version of its electronic reader in August, and this one will be thinner and more responsive, but it won't have touch screen capability or color.

Will it be enough to generate buzz in the era of the color, touch, multi-function iPad?

It's been a big week for rumors on the Apple-Microsoft watch. First, word spread that Steve Ballmer was on the docket for Apple's Worldwide Developers Conference in San Francisco next month, a rumor that Microsoft later squashed. Now, reports are swirling that Microsoft's Bing will become a prominent search function on Apple's iPhone, a report that first surfaced back in January.

TechCrunch's Michael Arrington initially reported that Bing would replace Google on the iPhone, but then later said that the deal appears to be more complicated than that and that Google will not be removed altogether. Meanwhile, Kara Swisher at Boom Town takes a swipe at Arrington's initial report.

She writes:

John Arnold

Intelius co-founder John Arnold has pleaded guilty to lying to a grand jury about engaging in sex acts with dancers at Rick's strip club in Seattle. As part of the plea deal, the government plans to ask for imprisonment of no more than 30 days. They also plan to request that a fine be paid at the high end of the sentencing guidelines, and that Arnold not make contact with dancers or managers of the strip club chain.

Heesen

A tax bill passed by the U.S. House of Representatives today could double the taxes on venture capitalists as it relates to carried interest, effectively treating investors in early-stage companies worse than speculators in gold and oil derivatives, says the The National Venture Capital Association. The chief lobbying industry for the venture industry issued a harshly worded statement today after H.R. 4213 passed by a narrow margin of 215 to 204.

“It is both ironic and disconcerting that legislators can profess commitment to creating jobs – and then discourage the type of long term investment which has been a proven job creator for the last century," said Mark Heesen, president of the NVCA. "We are one step closer to unraveling an economic model that has made America the global center of entrepreneurship and innovation. We urge the U.S. Senate to make the necessary changes to maintain a meaningful incentive for long term investment in the start-up economy.”

In our second installment of "Startup of the Week," we put our 10 burning questions to Sporcle founder Matt Ramme. The 3-year-old company, with offices in Seattle and San Francisco, creates quizzes and memory games around topics such as history, science, religion and movies.

What’s your elevator pitch in 140 characters or less... Over 90,000 fun and engaging trivia games on every imaginable subject that have been played over 260 million times -- users are addicted!

We came up with the idea... To solve our own problem with remembering interesting facts, like the names of the U.S. Presidents. The idea grew from there to focus not only on helping people remember facts they already know, but also on giving them a fun way of learning new and interesting information.

Cheezburger Network and Zillow.com remained in the top two positions on the Seattle 2.0 startup list for the month of April. But below those two big traffic hogs, there was a lot of movement with Seattle startups Feedjit, Survey Analytics, SEOmoz and Redfin each gaining one spot. Meanwhile, BuddyTV dropped three spots to No 6. (Maybe the Lost finale this month will help boost those BuddyTV numbers again). Below is a look at the top 30, with the full list of 409 startups here.

Here's the mystery photo that a tipster provided to CrunchGear. What Seattle coffee shop is this?

Amazon's electronic reader, the Kindle, has always had a white frame. But a black Kindle may be headed to market, if a grainy photo published by CrunchGear is any indication. An anonymous tipster allegedly took a picture of the device as it was being photographed in a Seattle coffee shop (presumably for Amazon marketing purposes).

Any guess on which coffee shop this is?

Keep your eyes peeled, people. Perhaps some young Amazon employee out for a night on the town will leave the next-generation Kindle in a local watering hole.

There's a perception that the Pacific Northwest leans "green," with a population that's concerned about environmental issues and the overall health of the planet. One might think that mindset translates directly into entrepreneurial ideas.

But, for a number of reasons (bigger market, venture capital, political structure), California is the behemoth when it comes to new innovations in the clean tech sector. Nonetheless, there are new ideas emerging in pockets or Oregon, Idaho, British Columbia and Washington. And to shed light on some of the people leading that charge, Pivotal Investments this week released 32 of the top names in Pacific Northwest's clean tech industry.

More than 600 nominations were received by the Portland, Oregon-based venture firm as part of the 2010 Pivotal Leaders program. Here are the 32 entrepreneurs and executives who are working on the next big idea in clean tech. Which one will is positioned for a break out success?

A new website called BookieJar founded by a veteran of Microsoft's Bing search engine team is diving into the electronic book market.

BookieJar is working on an e-book publishing and distribution platform for “independent writers,” according to its website. The site doesn’t say exactly how the service will work, but indicates that users will pay once a month and be able to follow e-books “in-progress” and interact with authors as well as publish their own books and “get rewarded.”

David Clugston photo

Selling shoes online is big business, epitomized by web shoe retailer Zappos, which recently got acquired by Amazon.com for $1.2 billion. Now a new Seattle-based e-commerce website is trying to carve out its own niche in the online shoe market.

Fabbys, which launched in April, is selling “super compact” ballet shoes that can roll up and fit into a small clutch or purse. They’re designed to be backup footwear for women who get tired walking around in high heels.

Alex Vorobiev, a former Microsoft product manager, said he and his wife Anna Fabrega came up with the idea while walking to a party in Seattle’s Capitol Hill neighborhood last year.