New Crop of Software Startups Growing Up

A new generation of enterprise software startups is springing up to replace those that failed and merged out of existence during the post-2001 IT recession.

SANTA CLARA, Calif.—In the years since the post-2000 IT recession and dot-com meltdown the software industry has been buffeted by business consolidation and job losses.

However, at the Software 2005 conference here Tuesday there were signs that a new generation of startup software companies is emerging with new ideas and products to replace at least some of the jobs lost through earlier business failures and mergers.

The companies that debuted products at the conference included Intellext Inc., which has developed a new context-based search system called Watson; ActStream Technologies Inc., which unveiled a new version of its rich-media communications hosted service; BDNA Corp., which demonstrated an automated IT asset inventory system; and Surgient Inc., which produces automated software testing routines.

Intellexts goal is to make search more effective, relevant and timely, said CEO Alan Wasserberger. "The world doesnt need another search engine, and we are not a search engine company," Wasserberger said. Intellext, based in Evanston, Ill., doesnt index Web sites and information stored on the Web, he said. Instead, the company is providing Watson, a context-sensitive desktop search tool that allows users to look up information that is relevant to whatever task they happen to be doing at the moment.

For example, a user could be writing an e-mail message about a new company sales win and use the Intellext search engine to check whether the competition has announced any comparable sales.

Wasserberger claims that Intellexts Watson technology provides more effective results than generic search engines because it is able to zero in on the questions that most concern users at the moment based on their current task.

"We fixed the problem that arises when users dont know what they should be looking for or where they should look for it," Wasserberger said. Watson is designed to serve up the most relevant information automatically.

/zimages/3/28571.gifClick here to read about the recovery in software industry venture capital spending that has been gathering momentum for the past year.

At the conference on Tuesday, Intellext introduced the ActiveContext iSuite, a set of search tools based on the Watson technology that allows Web publishers and content providers to implement contextual search features on their sites.

The suite, which will ship at the end of June, will integrate with any content management system or search technology a Web publisher uses so all users who access the site can run context-sensitive searches.

ActStream Technologies business approach is to provide a hosted service for delivering rich media communications across the Web. At the conference Tuesday ActStream announced Version 4.0 of its communications service. ActStream allows users to integrate audio and video with basic e-mail messages for sales and marketing campaigns, mass e-mailings, or any type of community building and support, said Robert Craig, CEO of ActStream, based in Burnaby, British Columbia.

Craig contends that scientific studies have shown that people only retain 20 percent of what they see and 30 percent of what they hear. However, information retention goes up to as much as 80 percent when people view messages that integrate text, video, sound and graphics, he said.

Next Page: Melding e-mail with multimedia.

John Pallatto

John Pallatto

John Pallatto has been editor in chief of QuinStreet Inc.'s since October 2012. He has more than 40 years of experience as a professional journalist working at a daily newspaper and...