Ah – it’s the first business day of 2005 and time for new product announcements.

Newmerix announced the release of their newest version of Automate!Test for PeopleSoft. Newmerix has been working on a series of packaged application optimization, change, and quality software products. The first platform they’ve released products for is PeopleSoft (and – if you’ve been alive the past few months – you’ll quickly guess that the next platform is Oracle.)

One of the cool parts of this new release is that Newmerix’s Automate!Test product uses proprietary technology to “synchronize” a test suite against PeopleSoft metadata. This dramatically increases the modification and usability of the test suites as you change your PeopleSoft environment, as your test suites will synchronize with changes to the PeopleSoft metadata. If you map this concept to Oracle’s environment (which Newmerix is working on), you’ll be able to both preserve your existing test scripts as well as understand clearly the impact the migration path from PeopleSoft products to Oracle products will have on your business.

When Oracle announced their initial offer for PeopleSoft 18 months ago, several VCs that were considering investing in Newmerix backed away because they were “worried” about what this meant for PeopleSoft. Our assertion then was that this would create a huge opportunity for companies like Newmerix since their relevance is directly tied to the development, upgrade, and migration cycle for products from packaged application companies like PeopleSoft and Oracle. 18 months later, I feel stronger then ever that this is the case.

NewsGator announced that they closed their second round of financing today. They also added two executives to their management team – Sandy Hamilton (EVP Sales and Business Development) and Mark Nass (VP Finance and Adminstration.)

When we made our seed investment in NewsGator in June, we didn’t expect to start raising another round until January and didn’t expect to close it until late Q105 / early Q205. However, I’ve been completely blown away by the progress NewsGator has made since we invested. There are occassions as a VC where you do an early stage deal hoping you’ve got something huge (every deal) and then wake up one day and realize you’ve really got something huge (very few deals.)

I had one of these days in October. After wandering around enthralled with NewsGator for a couple of days, I talked to my partners about simply doing a significant round on our own so the company could focus on building the business rather than spending a few months on the road fundraising. Based on the progress NewsGator had made, this was an easy decision for us. We ran our internal process over the span of a couple of weeks and made an offer to the company.

JB and Greg – to their credit – wanted to test the market to make sure the deal we were offering them was fair, so they talked to a handful of high quality firms that had expressed unsolicited interest in the company. Their goal was to quickly ascertain if someone would invest at a higher valuation than we were offering and be able to move quickly. These were both key conditions for them – an incrementally better deal wasn’t worth it if it took six months of work, due diligence, and partner meetings. Given our willingness to invest on our own, it was easy to create a quick feedback cycle. After a handful of meetings, JB and Greg concluded that the deal we were offering was fair and it wasn’t worth going through a multi-month process to get a second investor into the company at this point.

While I like doing early stage deals with other investors, I’m not afraid to do an early stage investment on my own. One of the investments I made in 2000 – Gold Systems – was done without any co-investors. I’m extremely happy with the business today, although it went through some rocky times during the 2001 and 2002 tech implosion. Ironically, it was probably easier to deal with things on our own as I could be patient, work closely with the executive team, and ride out the storm until the world got better. We did and the company is once again doing great.

A key attribute of going it alone is the quality of the CEO / enterpreneurs – in both NewsGator and Gold Systems cases I’m dealing with A+ folks that are in a position to create a self-sustaining (e.g. profitable) company on a well-quantified amount of investment which is within my capacity to do on my own. As a result, the pressure to syndicate the deal (e.g. bring in other co-investors) doesn’t exist from a financing perspective since I feel comfortable that we can fund the company on our own if we want to. While I’d still welcome co-investors into any of my deals, it’s nice to be able to move quickly and go after an emerging market without the requirement of a syndicate.

Technorati came out with a major upgrade today. Dave Sifry listed the improvements here, so I won’t repeat them, but it’s worth checking out as the search engine and data are dramatically improved. Oh – and it’s much faster (and hopefully a lot more stable.)

One of my companies – Finali – announced today that they were acquired by Convergys. It continues to be a busy M&A time for us as public companies are definitely buying private companies again. Since the beginning of the summer, we’ve had a number of public companies acquire our portfolio companies, including Service Magic (by IAC/InterActiveCorp), Cyanea (by IBM), Dantz (by EMC), and now Finali (by Convergys.)

Bob Burgin and his brother Dan started Finali in 1999 with the initial vision of creating a next generation customer care business. They grew it nicely through the bursting of the Internet bubble. However, in the last 18 months, the outsourced call center business (Finali’s original business) has come under extreme pricing pressure due to outsourcing trends to places like India and the Philippines. While we considered developing an offshore labor model (all of Finali’s employees are based in the US) our customers told us that they were much more interested in our call center analytics capabilities than our call center labor. As a result, Finali repositioned its business as a high-end call center analytics provider earlier this year.

We managed the initial transition with little additional capital and we were ultimately faced with a decision to either double down and invest in growing the new model or being acquired by an existing major call center outsourcers that wanted to add our analytics capabilitiy. We found several interested potential partners and ultimately chose to hook up with Convergys.

Congrats to Bob Burgin and his team at Finali.

Two of my favorite RSS-related companies (NewsGator and Technorati) announced new features today.

NewsGator launched an Enterprise RSS blog. They’ve been seeing a lot of enterprise adoption of their products, especially NewsGator for Outlook, and decided to start writing about what they are seeing and doing.

Technorati launched Vote Links which allows you to vote for or against a link on your blog. It’s a good example of Technorati innovation where they quickly roll a new feature and try it out on the blogosphere.

We just put an RSS feed up on our Mobius Venture Capital site for press releases. So – if you subscribe – you can get the press releases about our companies when we post them.

I got bitch slapped by some folks early on in my blogging career for simply posting press releases to my blog. This caused me to think hard about how to use my blog to promote my companies. I try to do it carefully, with context, and make it something more significant than a simple press release (e.g. tell a story around it, explain why I think it matters, personalize the experience, etc.). I’m always open to feedback on this as I try to balance information dissemination with shallow promotion.

If you are interested in seeing press releases from Mobius Venture Capital companies, simply subscribe to the feed.

I’ve added a new NewsGator feature to my blog – Ratings.  If you are looking at my blog online or via NewsGator Online, you’ll see a new thing in the footer of each post that says “Rate” and has five stars next to it.

To rate each post, simply click on the number of stars.  If you have a NewsGator Online account (or create one), you’ll be able to see both your rating (red) and the aggregate rating (orange).

Look for announcements as to how to put this on your blog next week.  If you want a headstart on this, take a look at the thread on the NewsGator Support Forum.

If you have suggestions as to what we should do with the data (we’ve got plenty of ideas that we are working on), feel free to post comments here.

NewsGator released a new version of NewsGator Online – their web-based RSS aggregator.

This version is free to consumers and includes new features including folders (manage all your feeds the same way you do in Outlook), per-post rating system, feed recommendations based on what you read, clippings (to save your favorite posts with one click), and smart feed enhancements including converting email-based alerts to RSS.

NewsGator Online includes subscription level synchronization with NewsGator Outlook Edition, allowing you to manage one set of feeds across multiple machines (I have four different computers, plus the web version with synchronized feeds.) As a result, I don’t have to worry about making sure my feeds are the same on all machines – whenever I change something on one machine (in Outlook or on the web), it synchronizes to the other machines.

There are lots of other cool features – along with a bunch of UI improvements – and more premium content relationships.

Check it out and tell us what you think.

According to my mom, this is a “brag”, not a “blog”.

Deloitte & Touche has an annual “Colorado Technology Fast 50” ranking. They rank the top 50 technology companies in Colorado based on their revenue growth over the previous five years. This year four Mobius-related companies made the list. I’m obviously proud of all of them.

#2 ServiceMagic: 5500% growth. IAC acquired ServiceMagic in July. We invested in 1999 – ServiceMagic had “a little” revenue then. ServiceMagic was every VCs dream – they defined “hockey stick growth” – once they found it (in 2002) there was no stopping them.

#4 Raindance Communications: 3044% growth. We invested in Raindance when it was three guys, an idea, and no revenue. Raindance went public in 2000 and survived the dotcom implosion to be the solid, successful company it is today. In addition to making some money, I got two incredible friends – Paul Berberian and Jim Lejeal – out of the deal.

#14 Level 3 Communications: 682%. We didn’t actually have much to do with Level 3, but they acquired one of our companies (Corporate Software) in 2002. Corporate Software – and its subsequent acquisition of Software Spectrum – contributed significantly to Level 3’s growth, so I’ll be gratuitous and list this one also. Fortunately, after Howard Diamond – the CEO of Corporate Software – retired – he got bored enough that I was able to entice (beg, plead, guilt) him into becoming chairman of ePartners.

#33 Gold Systems: 107%. I joined the Gold Systems board in 1996 shortly after I moved to Colorado. Mobius invested in 2000. The company has made steady progress through a difficult environment. After two years of flat revenue, they’ve started to grow again (profitably!) – Terry Gold and his team have done a great job hanging in there and building a real business.

While revenue growth doesn’t define success, it’s a key indicator for a venture-backed company.