Over the last couple of days, I have received numerous customer emails with regards to the quality of the Nimsoft team and product. I have removed any reference to company names/employee names etc because these are personal emails to me, but I have to share with everyone because THIS is what our company is about, this is why I started a company in the first place. Delivering incredible customer satisfaction which is sadly so often lacking in others.

I thank these individuals and every individual that takes the time to recognize why Nimsoft is different.

Email #1

I'd like to compliment your team on excellent performance and delivery.... Everyone we have encountered here has gone above and beyond in working with us to overcome the hurdles we needed to in order to get this done. xxx especially has done a great job of keeping his cool through what must have been very challenging and sometimes frustrating circumstances, and focusing on bringing all the right people into play in order to succeed.

I told you when we met that I am looking for a business partner here, not a vendor, and the challenges we have overcome together have helped to confirm for me that Nimsoft is willing and able to be that partner. Looking forward to much success in working together.

Email #2
We are truly excited about our alliance with you and Nimsoft. In our opinion, this partnership is a game changer in the MSP field and we will be leading the way. You, your team and your product coupled with our team and processes will change the face of what is expected from an MSP.

Email #3
This is a very important milestone which signals a very promising era of new business for both companies and the start of a long term fruitful relationship. As you know your product will be one of the most important components of our Business Support System and therefore is absolutely critical for our success. I imagine that xxx will be for Nimsoft a very important customer and even more important reference in the marketplace. Therefore we have all the elements on the table to make out of this relationship an absolute success.
I would also like to remark the very helpful and committed attitude of xxx who helped this milestone to crystallise......thank you very much for your help and flexibility to make this happen.

Why can't everyday be the last day of the quarter?

Such a buzz today....Europe has been bringing in business all day and I've been awake most of the night....12 new pieces of business today so far and we're still working on 5 more. Outside of Q4, which is always our strongest quarter, looks like Europe has set a new record for the region....but we're still going.

The US is starting to come into action now. First deal already won in the US today.....plenty more being worked.

Come on Nimsoft....!

Last couple of days of the quarter next week. We've still got a lot of business to get....some of which we will get, some we will not. Business across so many different verticals....retail, gaming, MSP, Network providers, financial services, energy, healthcare....

Moving in to Q3, we're going to be recruiting for quite a few key positions. UK/Nordic Sales Director (UK), Director of Operations (US), Marketing list/database management in both the UK and the US (probably contract positions), Sales executives (US), Snr Accountant (US), Contract Bookings specialist (US) and possibly a number of others as well...resumes@nimsoft.com if you know anyone.

Also got some really interesting partnerships developing that could add significant value to our customers. I'd expect probably one of these to be finalized and announced in Q3.

And finally, our entire engineering and product mgmt team is working really, really hard right now. There is an incentive in place for the entire team if they meet 100% of their 37 deliverables this quarter. I know that they are really close and suspect that many of them are putting in the hours this weekend to get things finished up....talk about peer pressure....it's an all or nothing incentive across 3 engineering labs.

Talking of which, of those 37 deliverables, 21 of them are product deliverables for products to go in to GA state. It's absolutely amazing what this team are delivering - I don't believe that there is another company in this space that can come close to the talent and deliverables that our engineering team has.

I am hoping to authorize their incentive....keep it up guys....our customers really, really appreciate this.

Unbelievable. Straight off the red-eye, I need to get some sleep and a shower before a HUGE meeting. Go to check in at the Westin New Jersey and they have sold my room.

Despite it being confirmed, reserved, paid for, and they were told I would not arrive until the morning.

But...to rub salt in the wound, the manager spends 10 minutes BSing me that "they didn't know I was going to come in in the morning" - only when I asked them to show me the reservation on their system (because this was confirmed) did they finally admit that they had "extenuating circumstances" the night before and in fact I was clearly bumped because they thought they could make some extra money.

Result = no sleep before one of the biggest meetings in the history of Nimsoft.

Result = they finally comp'd a Parlor room for me (smoking yuk!) - still no sleep

Result = I, and Nimsoft will never stay there again

Unbelievable....I bought and paid for something - what gives them the right to not provide it to me?

Of course because guess what? Gary's spending more time in airports. This time sitting in SFO waiting for my red-eye to the East Coast tonight.

We are continuing to do well in new deals - another significant Managed Service Provider came on board today - I can't remember exactly how many that is this quarter, but for MSPs that have scale and want the best, Nimsoft is clearly the go to brand.

I spent my day in customer meetings today....3 separate meetings with 3 CEOs of MSPs. I really enjoy this interaction - I always learn something new and I find it truly interesting how different MSPs have different themes on their market.

And finally....for the customer that I am going to see (and the sales rep that booked the meeting and got me on this red-eye tonight)....it's my birthday tomorrow. Yep, I will be somewhere over Ohio when my b-day comes (hopefully sleeping) and I will spend the day on the East Coast and probably flying back tomorrow night (although you never know).

25th June 19xx - the date I was born. .......going to see Chelsea Handler in concert this weekend to celebrate.

Some people see records as the pinnacle of achievement. Others see them as merely another stepping stone to the ultimate goal.

Today Nimsoft broke its record deal size.....again! A hugely visible and amazing customer name - one of the best companies in the world.

Congratulations to the Nimsoft team for delivering such an amazing product with incredible support that drives incredible customer value.

Thanks to the customer for your trust - we will continue to deliver in the manner that you've come to expect from us.

In Network World today....full article

How to dramatically cut costs on network performance monitoring

IT Best Practices Alert By Linda Musthaler , Network World , 06/19/2009
Musthaler

The economic downturn and reduced IT budgets are forcing many network managers to look for alternative (read that as "cheaper") products and solutions for managing their networks. If you find yourself in this boat, then read on. This article is about a performance and availability monitoring solution that competes with the enterprise products from companies like CA, IBM, HP and BMC Software. At the same time, this solution is saving its users hundreds of thousands and even millions of dollars.

Do you find that savings number hard to believe? So did I when I first talked to the executives at Nimsoft, purveyors of software for service-level management and business-service management. Then I talked with Scott Crowder, the vice president of the Internet Services Division of Blackbaud. Crowder is responsible for data center operations at Blackbaud, a $300 million company that services more than 20,000 nonprofit organizations (NPOs) around the world. Blackbaud's software helps the NPOs raise funds through donations made online, so Blackbaud's Web applications are mission-critical.

Blackbaud operates four major data centers in North America, and it has just acquired another in The Netherlands. Each of the North American data centers has about 20 racks holding thousands of servers that process the donation transactions and run online marketing applications and e-mail processes. Crowder's team monitors the performance and availability of the servers to ensure that the business applications are always available and performing within specific service levels.

About two years ago, Blackbaud adopted the Nimsoft Monitoring Solution (NMS, formerly called NimBUS) in one of its divisions. The results were so good that Blackbaud adopted NMS across the entire enterprise, displacing two other enterprise monitoring tools that had been in place for years. Crowder says the tools that Blackbaud took out had onerous licensing terms that made it cost prohibitive to scale the solutions when needed. The annual maintenance fees alone were very costly. What's more, the old tools didn't offer all the features Blackbaud needed.

Crowder estimates that Blackbaud saved about $750,000 on the initial purchase of the Nimsoft software versus the other tools. The company is realizing annual savings on maintenance in the range of $50,000 to $60,000, or possibly even more.

$120 to fill up my rental car in the UK - can't wait to get back to the California Prius that takes $19 for a full tank :)

Shameless plug....you MUST attend our upcoming webinars on scalability

June 17th 6am Pacific/9am Eastern/2pm for the UK/3pm for Central Europe - register here

Then again the same day at

June 17th 11am Pacific/2pm Eastern - register here

You will here about the real life testing we've done with customers and why Nimsoft has such incredible scalability.

Is it truly the most scalable on the planet? Well, truth be told we're not completely sure...all we know is that some of the most demanding environments in the world are trying to find the limits and not getting there and we don't know anyone else that can cope with some of the massive infrastructures of today as well as we can.

I'm sure they'll be plenty of competitors tuning in for this one :)

5 out the top 20 managed hosting providers are Nimsoft customers.....pretty good stuff.

We've got a big couple of weeks ahead of us. Working with some huge companies and huge visibility pieces of business.

That means lack of sleep for me and many others in the company - hoping to take my kids to LA for a few days over 4th July weekend.

to say that I kinda like Bing? But where's the blog search capabilities?

Excellent end to May for Nimsoft...multiple new and repeat pieces of business won this week....including a major East Coast Managed Service Provider that we are very proud to have won their business - they certainly put our technology and our people through the ringer.

I hate to say (in this economy) that I'm quietly confident for a strong Q2 but........we'll see.

McAfee acquiring Solidcore for a decent multiple
EMC acquiring Configuresoft for a good multiple as well
Solarwinds positive IPO

Couple of fire-sales as well of companies that simply can't make it.

Big companies will buy at the bottom of the market where they can get the best bargains (sort of like buying at the bottom of the housing market).
The walking dead will finally die off.

These all seem like signs of the market shaking itself out ready for a recovery.

Made a quick trip to SoCal today to visit customers and partners. I find that so few people truly understand the Managed Service Provider space, it's a joy when we meet with individuals that really get it!

Stopped off to watch Man Utd get mauled by Barcelona in the Champions League....amazing how a team so good can perform so badly.

Our new Biz Dev leader joined yesterday...this is huge for us as we've got so many things that we're trying to do that we need someone to help juggle some of the balls for us.

Interviewing for additional sales leadership in both Europe and the US. Got some amazingly talented individuals that we're talking to - the team just keeps getting stronger.

Congratulations to EMC and Configuresoft for that acquisition announcement today - looks like everyone is happy with that one. I'm assuming that EMC are becoming more and more competitive with BMC, HP, IBM in the world of the big-boys as they are rounding out their portfolio.

Had a wonderful dinner at Hakkasan in London on Friday night and the flight home yesterday was uneventful.

Would you believe that, while in the bar at Hakkasan we spotted and chatted to some people that we know from where we live in Los Gatos....amazing, thousands of miles away, and they happen to be in the same bar, in the same city at exactly the same time as us.

Earlier in the week, walking through the streets of London, I bumped in to an ex-colleague of mine that I haven't seen for probably 12 years. He's the country manager for CA in the UK - hmm, I'll say no more.

Tons of emails to catch up on, but pretty much done most of them - the beauty of long, boring flights. It's nice to be back in California weather, although I need to go for long runs this week to lose those extra pounds that I put on in England.

Very, very successful trip. We've had a number of changes recently with the UK sales team, but I'm confident that we've got a great team in place now. Some new blood coming in plus, our existing top performers are still performing incredibly, and one rep that left us over a year ago coming back to re-join the company. I'm very proud that we've never lost one of our premier sales performers.

Got a day trip to SoCal planned this week, but also got a few personal things to catch up on. Looking forward to Memorial Day weekend - hoping that the weather holds out.

Nimsoft poised to remain consolidator in quest to challenge Big Four

Now that it has completed its product integration of Indicative Software and is beginning to do the same with the assets that it recently obtained from Cittio, what is Nimsoft's next move in its continuing effort to compete with IBM (NYSE: IBM), Hewlett-Packard (NYSE: HPQ), BMC Software (NYSE: BMC) and CA Inc (NYSE: CA)? Business transaction management, desktop monitoring and management and more root cause analysis tools could all be on the company's shopping list.

Context

Nimsoft recently closed its second acquisition in a little over a year, buying source code and other IP from Cittio for an undisclosed amount in a deal made with cash on hand that likely amounted to a fire sale. Once the transaction became public, Cittio shut down its website, replacing it with a message saying that it was winding down operations and dissolving. The purchase will give Nimsoft technology for level 2 and 3 network discovery and topology mapping, monitoring and root cause analysis, filling another gap in its growing suite of IT performance and availability management offerings that it is positioning as an alternative to the Big Four IT management framework vendors' software.

This follows up on Nimsoft's purchase last April of Indicative. That pickup has given the acquirer new software for user experience management and its recently announced Business Service Management (BSM) Express offering, which shows how IT service performance impacts the business services they support.

Nimsoft has enjoyed a great deal of success and rapid growth selling mostly to the midmarket and to managed service providers (MSPs). The vendor has expanded from just over 300 customers in mid-2006 to about 850 today. It grew from $10.2m in bookings in 2005 to $29.4m in 2007, then stated that 2008 bookings were $40m-50m. However, it also disclosed that bookings increased by 47% over 2007, which would put the exact number at about $43.2m. While Nimsoft likely did not reach its stated goal of $50m in revenue by 2008, it continues to grow.

Filling more technology gaps, especially those that will make it more appealing to large enterprises, will ensure continued growth for Nimsoft.

Likely targets

Nimsoft's strength remains performance and availability monitoring. Cittio gives it solid technology in this area for the network. Indicative upgraded Nimsoft's technology for the user-experience end of application monitoring and gave it the kind of reporting, metrics and dashboards that enable IT organizations to measure the impact of IT service performance on the business services they support. Nimsoft already had extensive monitoring capabilities for applications, servers, databases and service-level agreements.

The firm is positioning its existing offerings for the cloud, which we think it should be able to do fairly easily given its penetration of the MSP market and the fact that its software has extensive capabilities for monitoring IT service levels – including in virtualized environments – and assessing their impact on business services, which is technology that would be necessary for managing private cloud environments. We believe Nimsoft will for now maintain its focus on performance and availability management rather than make a leap into IT asset, service and configuration management, though it will certainly have opportunities to enter the latter down the road.

So how can Nimsoft extend its IT performance management and availability wares? The desktop is one possibility. Beyond managing application performance from the end-user perspective, the vendor doesn't really have monitoring software for client devices. We wouldn't expect it to make a huge investment, either, but a tuck-in acquisition is possible.

One potential target is Persystent Technologies, which has strong technology for detecting and resolving PC system failures or performance degradations at boot-up. Buying Persystent could also give Nimsoft a start in IT asset and configuration management as well as policy management and enforcement. Acquiring Vector Networks would have similar benefits for Nimsoft: extending performance management to the desktop, while providing IT asset and service management, including helpdesk, at the same time.

Triumfant would be another possibility with its desktop monitoring plus automated incident management and problem resolution, which is technology that Nimsoft doesn't really have at any level, but could move into and apply to the other layers of IT infrastructure that it monitors. However, much of Triumfant's focus is on finding and removing malware, corrupted registry keys and detecting violations of IT policy. Nimsoft is more likely to stick to performance and availability management rather than make a foray into endpoint security.

Another option for Nimsoft would be to extend its service-level monitoring into business transaction management – tracking business transactions through layers of IT infrastructure and pinpointing the cause of service degradations, which Nimsoft already monitors for. DynaTrace software, whose strength is primarily in pre-deployment testing, could be a good fit for Nimsoft here. OpTier is another startup in this space, but is currently well-funded and growing, and is not seeking a buyer. Israeli company Correlsense, which hasn't made the big splash it intended to in this sector, is a better match. BlueStripe Software has some interesting technology in this area for heavily virtualized environments and some early customer traction, but will likely seek more growth on its own for the time being.

Nimsoft might also make a foray into the performance management of service-oriented architectures (SOAs) and the composite applications that comprise them. SOA Software, AmberPoint and Nastel Technologies are all possibilities here, with Nastel probably being the closest thing to a performance management pure play among those three and therefore perhaps the best option.

Acquiring Cittio gave Nimsoft root cause analysis software for the network, which was a key part of the deal. Nimsoft may look to add root cause analysis software for the other layers of IT that it monitors. Netuitive and Integrien would be the most suitable targets here, with a better deal to be had for the smaller Integrien.

While it's tempting to predict that Nimsoft will make an acquisition to improve its cloud management positioning, we think the company will make the most of its moves in this area from technology that it already has. Besides, cloud management means a lot of things right now, and any emerging players in this space are way too early stage to be ideal targets.

Looking ahead

After buying Indicative, Nimsoft released two new products obtained through the acquisition over the next year, the Real User Monitoring appliance last summer and the BSM Express offering in April. Less than a month after the second launch, the vendor announced that it had purchased certain assets of Cittio. If that pattern continues, Nimsoft will first integrate the acquired IP and source code into its software, which is a process that likely won't be completed until sometime in the fourth quarter. We would then expect Nimsoft to become acquisitive again. It may move sooner, though, since the product integration of Cittio's technology will be a much smaller job than that of Indicative's.

We'd rank dynaTrace as the best fit for Nimsoft. Its pre-deployment capabilities, deep-dive diagnostics, root cause analysis and even SOA visibility would fill many of the gaps in Nimsoft's existing product suite and be an excellent complement to its extensive monitoring capabilities. Failing dynaTrace, we could also see Nimsoft picking up Integrien, a company that has achieved limited traction with its strict focus on root cause analysis, and is clearly positioning itself to be bought at the right price. Either Persystent or Vector would be a good catch for Nimsoft at the desktop performance management level, with Vector providing the added benefit of IT asset and service management, should Nimsoft choose to close that IT management loop.

In any case, with the economic downturn forcing some vendors to make the best deal they can and move on (see Cittio), this remains a buyer's market and we don't think Nimsoft will wait another year to strike again.

Congratulations to the German team, another new customer in Germany today and....one in France as well.

Spent the week in Europe again - Ireland on Tuesday and then rest of the week in England. Mainly customer visits and also a lof of interviewing as we are looking to add to the team.

So far, 2 customer visits on Tuesday in Ireland, 4 on Wednesday in England, none today (in office) and 2 (maybe 3) tomorrow. I think that's the kind of meeting volume and quality that would make a field sales executive happy.

We're into the second beta version of our new Service Delivery Portal....extending it out to about 12-15 customers...tons of new development - it's exciting stuff.

The news is out, Nimsoft has made another asset purchase that will further extend our product's capabilities and allow customers to continue to reduce the number of tools that they use.

At Nimsoft, we believe in building a solid product and a solid business over many years which is what we've done. We believe in actually generating revenue, building our customer base, supporting our customers in an exemplary fashion. And we believe in extending our product continually because, even though we already have by far the best product in this space, we always want to keep making it better.

This purchase was completely opportunistic for us. We had an engineering project internally to build Layer2/Layer3 discovery but the opportunity came along to acquire some technology that was already built and working in customers.

We will not be using any of the OpenNMS components of the Cittio products, we will only be using the discovery, topology and RCA - and we will be taking their code and working it in to the Nimsoft Monitoring Solution. This purchase is all about us being able to provide this capability more rapidly to our customers.

So, what next? Well now that I've done the easy part (acquired the source code), it's time for the guys with the big brains to do the engineering and development work involved in lifting this code and dropping it into the Nimsoft product. For our customers, we are expecting to be able to release this in Q4 this year....although we can't be definitive about that until we get a little more in to it.

More later....

Noticed this yesterday, one of our customers quoted in a press article....thanks for the shout-out!

Daniel Granja, an IT manager at Monterey, Calif.-based online retailer Shop.com, also replaced homegrown code, cobbled-together tools and open source products with proprietary software. Shop.com switched from Cacti and other tools to Nimsoft Inc.'s Nimbus.

Shop.com uses Nimbus to monitor hundreds of servers, including internal corporate services and external e-commerce.

"Cacti is free, open source. But you spend your time on it," Granja said. "That had been the solution we were really running on prior to Nimbus. With Nimsoft's support we cut our efforts in half. We'd never been able to monitor the entire environment before, but with Nimbus we are able to."

It's always been a good time to be a Nimsoft customer, but on Monday we will be announcing another technology/source code acquisition that's going to make our product even better.

It will also serve as another data point to show that very small vendors are at HIGH RISK in this economy.

We continue to add features and functions that are normally associated with products many, many times the price and complexity of Nimsoft - the amount of coverage and capability that we've got is simply amazing.

Also, separate subject but we will be announcing the results of some scalability testing soon that will blow everyone away.

Great time to be a Nimsoft customer, horrible time to be a Nimsoft competitor....but then they already know that!

Thanks Remko!

Lips are sealed but more big news coming for our customers and potential customers on Monday.

The best Performance and Availability Monitoring company on the planet is about to get even better......

Plus, we signed a major new contract today with a large Federal Agency

And....I'm on twitter - garynimsoft - in case anyone is the least bit interested (as if the blog was not boring enough)

BMC announcing their results tomorrow - looks like they are expected to be strong although it's been Bladelogic & Remedy driving growth. I heard so many people say that BMC "overpaid" for Bladelogic......I'm not so sure. Talk about a halo effect! Deals with Cisco and Dell driven by the Blade products.

Quest announced their results today - license revenue very weak due to economy. Ugh - they had a tough one.

Noticed in Solarwinds IPO filing that their license revenue in Q1 2009 was essentially flat from Q1 2008. Flat = Excellent for most people in this environment. Hope they pull off the IPO - about time this space had one!

On another note...we've got some interesting announcements to make....not sure if we'll get it out tomorrow - may have to wait until Wednesday.

I saw interesting blog on the Var Guy site today....take a look at http://www.thevarguy.com/2009/05/11/sugarcrm-ceo-change-an-open-source-setback/


Really interesting to me where these open source business models end up. Also, I wonder what Oracle is going to do with MySQL when it gets its hands on it? Of course nobody will know for sure for quite a while

It still amazes me the length of the summer holiday for kids in America. My guys are off for 11 weeks....when I was at school in England it was only 6 weeks summer holiday.

We're busy planning for all those camps to fill that time. Flag Football camp for one, Horse Riding camp for another, school camp for a few weeks, sports camp at the gym for other weeks....it's a big job all this planning and then, some of the camps are 11 until 3....hmm, how to get them to camp, pick them up from camp and still work?

Taking 2 of the kids over to the England to spend a week with their cousins and grand-parents in the middle of all that as well, and probably some family vacation, possibly in LA.

3 customer meetings in the UK today....2 good ones with existing customers, the other one talking to a customer where we lost a deal recently (yes, we do lose sometimes). All really good meetings.

New Sales Execs on board in the UK (we've had some changes recently) - they are getting into the swing of things. Still so many areas where we can improve within the company.

Numbers for the quarter....well I won't tempt fate. April was solid (that's my word for not spectacular but not bad either), we are in and winning lots and lots of deals but...they've got to close.

Grey Goose in the Sky Bar in Oslo and it's now 2am and I have to leave the hotel at 8 so I better get some sleep.

Always learn something new every time.

Just come from a major oil company and now going to meet the UK MD of a major outsourcer/managed service provider.

Meanwhile, thanks to the power of 3G mobile cards, can update blog from the train.

Doing interviews this afternoon for some new hires, more customers tomorrow and then off to Oslo to visit with the R&D team for Friday and then....back to California.

Great to see Man Utd win so comfortably last night. Chelsea or Barcelona await. Unfortunately won't be able to go to the final in Rome.

I asked someone a question a while back on how do you drive comments to your blog?

Well...guess I have the answer....make some comments about Open Source business models that could be construed as controversial or negative.

:)

Just arrived on an overnight flight to London. In the cabin where I was seating the light switch was broken - so I spent all night with bright fluorescent lights shining at me. Really made for a good journey.

This was announced earlier...

Springsource Acquires Hyperic To Unify Developer To Datacenter Application Lifecycle

Really not a surprise at all. I've been saying for a long time that being successful in this space is difficult and my belief is that any "monitoring" company that tries to use the "give the open source away and charge for the professional edition" as its business model will fail. We've seen many of these already and they will continue to fail.

Look at who the most successful and rapidly growing companies are today.....Nimsoft, Service-Now, NetQoS, Solwarwinds.....none of these companies are using the open source business model.

Don't get me wrong...I'm not saying that there is anything wrong with using Nagios or other platforms for monitoring. They fill a need and for certain environments they fill the need very well. BUT, what I am saying is that vendors that try to build a business out of offering a "professional edition" will fail. Monitoring/systems management is NOT sexy - it is hard work. It requires support for a huge range of platforms, constant testing, constant updating, scalability, reliability....all those things that we take very seriously.

More will fail.....

So far today:

Board meeting, customer meeting, investment bank meeting, partnership meeting, internal blitz going on, trying to get hold of our lawyers, re-booking flights for next week so that I can go to Oslo as well as London, canceling handyman for broken dishwaher .....and my assistant is on PTO!

Austin’s IPO drought may be ending
By Lori Hawkins

Could it be? An Austin IPO? It’s sure looks that way.

This morning, software maker SolarWinds Inc. said it plans to offer 12.1 million shares at an estimated price range of $9.50 to $11.50 a share. That could net upwards of $100 million.

And the IPO could make its investors — Austin Ventures, Bain Capital Ventures and Insight Ventures — some money too. According to filings, all plan to sell some shares in the IPO. (Although AV is a minor player in SolarWinds, owning just 3.4 percent of shares before the offering.)

SolarWinds, which is profitable and had revenue of $93.1 million in 2008, would be Austin’s first IPO since 2006, when Golfsmith Holdings International stumbled out the gate. Nationally, there has been a drought of IPOs as well, with only two new issues on major U.S. stock exchanges in the first quarter, according to Hoover’s Inc.

Three Austin companies have withdrawn IPO filings in the past year: Creditcards.com, Convio Inc. and Capstar Acquisition Corp.

It’s unclear when SolarWinds will go out, but it could be as early as today. (And then again, there’s always the possibility it won’t happen at all. It will depend on investor reaction.)

SolarWinds was founded in Tulsa, Okla., 11 years ago, and moved to Austin in late 2006 when local high-tech veteran Mike Bennett took over as CEO. Austin Ventures invested $7.5 million in the company in early 2007, joining Bain and Insight as backers.

If and when an IPO happens, SolarWinds will trade under the symbol SWI on the New York Stock Exchange.

Nice going to the US sales team.....3 brand new customers today - 1 end-user Enterprise and 2 Managed Service Providers.

Good going.

Never normally one to comment on rumors, but I have heard this one from multiple different places over the last couple of days.

Certain large Big-4 vendor in the final throws of buying Solarwinds....I know that BMC don't have any network monitoring offerings but....

From The451.com today.....

Analyst: Karin Kelley
Date: 27 Apr 2009

Australian managed service provider (MSP) Interactive has deployed Nimsoft's Monitoring Solutions in its datacenters. Interactive's IT administrators are using Nimsoft's Service Delivery Portal to create custom dashboard views of systems performance and availability monitoring data. Interactive's customers can access the data online to ensure that service-level agreements are being met. With five datacenters in Melbourne, Sydney and Brisbane, the MSP provides hosting and maintenance services for more than 1,200 businesses in Australia, New Zealand and the surrounding Pacific Islands. Interactive claims more than A$60m ($43m) in annual services revenue and plans to invest A$900,000 ($650,000) on eco-efficient IT this year.

All received in the last 10 days....there was a fourth example but I'm not allowed to publish it as it is a government customer...

Others may talk the talk - Nimsoft walks the walk.

Example #1

Mr. Gary Read,

Your Director of Customer Support, XXXXXX, just took my tech support call at 10pm London time, and spent an hour from 10pm-11pm on a Friday night outside of London on the phone with me troubleshooting a problem.....

Please thank XXXXX for me. He is truly a dedicated Nimsoft employee, and he is a great example of a hard-worker who puts the customer first.

Warm regards,

Example #2

Hey mate,

XXX has been a star!!... he has spent about 4 hours working on this and although we are only speculating what the problem was caused by he has made some good suggestions on how the tunnels and some other things should be structured for an MSP.

The end result is that I have started to restructure... ... and they have stayed connected and are working fine.

Once again he had been excellent and should be kept in good supply of beer for the next could of weeks he is here!
Thanks for your help today too with getting him in touch.

Example #3

XXXX,

Once again, your contribution is of amazing service. Thank you so much
for your help. My new module is working perfectly after your
assistance..... In any event, our project is back on
track... once again thanks to you. I really appreciate your help in our
efforts.

XXX - Thanks for keeping track of this. This matter is closed from our
perspective.

In the last 7 days, I have received 4 unsolicited emails and letters from customers expressing their delight with our customer support. In one case, we had someone work over the weekend to help a customer, in another case someone worked late in to the night to do the same thing.

I will be posting each of these letters and emails to the blog as soon as I can get somewhere that I can scan them.

It makes me very proud of the organization and team that we have built.

Tomorrow, we'll be announcing a game changer in BSM. No longer does it takes months to implement, no longer does it take hundreds of thousands of dollars to buy and even more for services, no longer will BSM projects fail to offer value.

BSM Express is in General Availability and is announced publicly tomorrow.

A quick taster of one of the "out of the box" BSM dashboards....




So, how did we get here...what have we done?

Well, first of all, the Indicative acquisition that we made in April of last year was absolutely key. As we told our customers at the time, we purchased Indicative to gain access to the BSM modelling technology that has made it the preferred solution of multiple large environments around the world such as BUPA, NTT, Easynet and The US Department of State.

But, we've spent the last 9 months making an industry leading solution, even better. We've added tight, database level integration with Nimsoft's Monitoring Solution. We've added attractive and highly functional new dashboards that integrate directly with the monitoring dashboards of Nimsoft, we've added multiple "out of the box" business models for common applications - and we'll be adding many more. And, best of all, we're offering all this for a price that is simple unbelievable.

How much? Well...it starts at $10,000 and can go up to $20,000. No...before I get lots of comments, I didn't forget 2 zeros or even 1 zero. Truly, I said Ten Thousand Dollars up to Twenty Thousand Dollars.

How can we do it?

Just like with the Nimsoft Monitoring Solution, we believe that BSM should be available to many customers, not just the largest ones, and just in the same way that we've built over 800 customers using the monitoring solution, we intend to build a large customer base for BSM Express as well.

Our engineers are already hard at work on the second version of BSM Express, we've been code complete on this version for some time and we're already installed in about a dozen or so customers. We expect that number to expand pretty quickly now that we're announced.

This is truly very exciting for us and for the market. One more screenshot to look at....if you want more details, register on our web site or you can always send me an email at garyread@nimsoft.com - we'll be happy to send you the download link.

Had a long day today (well yesterday actually). Started early, did 3 customer visits (2 prospective and 1 existing), did various conference calls and then went to dinner to interview a potential employee. When I'm on the road, it's incredible how long hours I keep - working a double shift effectively because there is nothing else going on in the evening, not sure how healthy it is though. (But, right now it's 5.55am in the UK and I'm about to head to the gym!)

I am looking forward to getting back to California, spending the weekend with the family and then I'm heading off again on Tuesday, but this time for some relaxation hopefully.

It seems at the moment that something new is happening every day in this space and something interesting is coming to Nimsoft very regularly. We're working on a lot of partnerships right now, some that are small but will help our customers get more value and some that are larger and will impact the broader industry.

BSM is coming...I'm finished with the teasing - I believe we are announcing next week. We're already signing customers and we are really happy with the feedback so far.

I hope everyone realizes how significant Cisco's recent moves in to the data center are. This is a huge huge market that they've never played in before and they have an absolute ton of cash to buy their way in.

They've already got existing relationships, so customers are going to listen and treat anything that that say with credibility. Yes, they don't have the track record but....look at VOIP.....they had no track record there and now dominate that space.

Not suggesting that they are going to dominate, after all, the competitors in the data center are pretty formidable in their own right, but I would imagine that they will absolutely take some share.

Time to sit down with a pencil and paper and try to figure out who they are going to buy next - I've made some good money on stocks over the years simply by betting on who is going to be acquired.

In the management space, Cisco are either going to build their own suite by buying lots of smaller players (aka Tidal) or they will buy big for someone who is already established. They tried with Bladelogic before BMC eventually got them and they've snapped up Tidal.

What do they need? Event Management, Service Level Monitoring, BSM, Service Desk, CMDB, Run Book Automation, Network Monitoring - lots of different pieces.

There are some really hot private companies in each of these areas, Nimsoft, Service-Now, Opalis, Stratavia, NetQoS to name just a few.

But, my bet would be on them buying big. I mentioned BMC the other day - the other alternative would be Quest Software - after all Quest have been buying a lot of Virtualization tools themselves over the last couple of years.

Time to sell my stocks in that UK Bank and invest in some BMC and Quest I think.

I travel quite a lot to the UK and every time, I bemoan how inconvenient it is.

First the good stuff....because I have a Gold Card with Virgin then I get to use the arrivals lounge at Heathrow. They iron my shirt and suit and give me a bathroom to shower in, nice cup of coffee....perfect, I can be off the plane and ready to work in less than 30 minutes.

But, what about the hotel? What I'd really like to do is to leave some things in the hotel. Maybe 1 suit, a few shirts etc, maybe some toiletries, and my gym gear. Otherwise, I have to continue to carry this stuff back and forth across the Atlantic.

It doesn't seem too much to ask does it? They could get the shirts dry cleaned as well and of course, I'd always use the same hotel because my stuff would be stored there. Sort of like a locker that you could rent at the hotel.

Anyone know whether this exists? Could be a good business maybe.

Interesting news today with Cisco buying job scheduling company Tidal Software. Wonder how that sits with BMC given the recent datacenter partnership and given that BMC have directly competitive offerings to Tidal products? I actually wonder whether this is a ploy by Cisco because the company that they are really shopping for may be BMC themselves...maybe they tried to buy BMC and couldn't, so instead they try to scare them a little by building there own suite and force BMC back to the negotiating table. Anyhow, far be it from me to start a rumor and I can categorically state that I have absolutely zero information - just pure conjecture by me.

The451 Group are speculating that Cisco will buy more companies to build a suite of offerings and they mention Nimsoft as a potential target. Seems that lots of people are speculating about us these days....guess that's what happens when you are as successful as we are.

After all, who else is there to buy in monitoring and service level management? Most everyone else is tiny and their products are very limited - Nimsoft scales up and down from mid-market to the largest enterprise and has such a healthy managed services and cloud business.

But, Nimsoft has a long and successful future ahead of it - I was on a call with some of our architects yesterday, we're just about to kick-off a new engineering project internally that is really, really exciting. BSM gets launched any day now - is it next week?

Dug a little more into the Q1 results today, some interesting stats.

49% increase in New Bookings for MSPs
110% increase in new MSPs signing up in the quarter with Nimsoft

This is in addition to the 54% increase in monthly recurring revenue

The MSP business has continued to be really strong for us.

Airport hotels...don't you love them? Especially ones at Heathrow....

Had a whirlwind but GREAT trip to the UK. Spent all day yesterday with the sales team - spent the night watching European Champions League football and spent today in the office and then shaking hands with a customer on a very large piece of business for us.

Although, I must say, half way through writing this blog my room service arrived. I had decided to order curry - I figured that sleeping in a hotel room smelling of curry was OK. But, the room service waiter managed to drop the entire plate on to my hotel room floor. So, right now I have a hotel room floor covered in curry and I'm waiting for housekeeping to come and clean it up.

So, I'm now hungry, tired and have curry-floor in an airport hotel at Heathrow. What a glamorous life I lead!

At least it missed my luggage (see, there is always a silver lining).

We should get our Q1 results press release out on Monday. Overall pretty solid overall performance - not quite the hyper-growth of the past, but good continued momentum and positive cash flow.

Off to London again soon - I think Richard Branson should love me. Going to see Lily Allen in concert tomorrow night......

Why is it that an ex-employee feels the need to spread malicious and false rumors about us?

Why is it that the same person is so cowardly that they hide behind an "anonymous" title and pretend to be a customer of ours?

Maybe you don't work with us any more but does that mean that you want to make blog posts that are factually incorrect and the only possible intent could be to try and damage things for all of our employees and customers?

Oh well....good luck to you - I hope you sleep better tonight knowing that you have contributed constructively to the world being a better place.

Opened my inbox to a new Gartner report today entitled

"Has market consolidation killed IT Operations management tool innovation"


Interesting piece....I cannot post it here because it is copyrighted - suggest that you use your Gartner subscription to download a full copy or give us a call and we'll talk to you about it.

Significant market consolidation has left few IT operations management vendors with annual revenue between $50 million and $1 billion. The ramifications are important to understand as IT organizations look for advances in IT operations management technology to deal with growing IT complexity.

Cisco's announcement Monday will mean some interesting decisions for their partners and VARs who are often partners with HP as well. Bladelogic being included on the servers....wonder what a Cisco partner that resells Opsware does? Seen and heard lots of different opinions....

But, back to Nimsoft business, I spoke to a major Managed Service Provider today (not yet a customer of ours). They told me, I quote, "You are sitting on an absolute goldmine. Your product is simply amazing for MSPs and there is nothing else out there".

I completely agree. The big guys just don't get it, the smaller platforms cannot scale or don't have the breadth. Nimsoft really is in a unique position.

Now...we also have another MSP that is telling us that they are evaluating Solarwinds and that "Solarwinds is much less expensive".

Our answer...."we don't compete with Solarwinds". It's a low cost, web download toolset that's all about "stack it high and sell it cheap". Don't get me wrong, I'm not being negative about Solarwinds for a minute - it's an excellent tool for network engineers. If someone truly thinks that the Solarwinds product and company can provide them the capabilities and support that they need to support a growing managed service business....then they should go for it.

Anyhow, 7 more business days to end of quarter...business is good but I've got to say, many customers are "sitting on their hands" delaying decisions.

But, stock market is up right?

I really have to thank folks that read this blog. I am so horribly inconsistent with the timing of my posts....I'm sure I'd have given up on me a long time ago. Some are long, some are short - some about business, some about my ridiculous life style.

What shall we ramble about today....

BSM - launch date has been set for mid-April, already installed at about 10 customers and feedback has been eeencredibel. Sorry for the constant teasing on this one but we've been working hard on this and think that we have a game-changer; our engineers and product management team have done a good job on this one. Don't want to let the cat out of the bag too early.

We are also code-complete with the next version of our Service Delivery Portal - lots of new functionality and enhancements - looking to ship in Q2

Delivered our first Cloud Computing webinar recently (not me of course, we needed someone that actually knew something) - was a great success. Lots of buzz about Cloud right now - some real, some hype of course. We'll be issuing white papers and customer cases studies in the next week or so. We actually already have customers using Nimsoft to monitoring Cloud Computing resources (yes....real customers paying real money)

Presented at the Montgomery Technologies conference this week in Santa Monica - unbelievable...the place was packed. I was trying to figure out whether all these software execs were "doing deals" with each other to combine their companies or whether they had nothing better to do :) Suspect it is a little of both - lots of companies looking around for other companies to buddy up with right now; we get a lot of approaches and certainly may look at adding new products in to our portfolio at some time.

Next couple of weeks involve multiple trips to SoCal....trip to East Coast and back over the pond again to London.

Also...anyone see that comment on my blog about the rumor of BMC buying Nimsoft? Funny...I remember the days when XX big company buying YY smaller company would be regular rumors....normally they are started by XX big company employees because they keep losing business to YY smaller company and they try to create FUD in the eyes of the customer. But...not sure that is true in this case because we actually don't see BMC too much in competitive deals.....HP would be another matter....wonder if the HP team are starting nasty rumors?

Gotta run....our operations team are about to present a new accounting package to me......no comments please...I've had extra caffeine ---LOL

What a week....started Sunday night red-eye to Boston....

Prospective and existing customer meetings in Massachusetts, Connecticut, Rhode Island, New Jersey and New York on Monday/Tuesday/Wednesday. Think about this British guy driving around the East Coast, including driving around Manhattan....and you'd be right, I got lost A LOT (Hertz Never Lost is absolutely the worst GPS ever - I am a case study for the nickname Forever Lost)

Then, after running through JFK to make my flight, I arrived in London at 6am Thursday morning. Into the office for 4 sales reviews with the sales team, then train in to London for prospective customer meeting. Down to Brick Lane for a ruby for dinner and then two more customer meetings on the Friday and then, lunch with our VP EMEA talking about the year ahead.

Visited my parents on Friday night....awaiting news of my brother and his wife who, upon knowing that I was heading back to California in the morning, proceeded to deliver twin baby boys just in time for me to visit them in hospital at 4.30am this morning so that I could make it to Heathrow in time (thanks Lisa!)

Now...sitting in the Virgin lounge because the flight back is delayed. A long week but a good week both professionally and personally. Looking forward to getting home and re-uniting with my family again.

We have got multiple new releases coming out of engineering that we are looking for beta customers for. Looking for existing customers that can act as beta for....

Citrix Xen Server monitoring
Microsoft Hyper-V

and of course, we are in active beta with our Business Service Management offering.

Any existing customers want to try these new offerings? If so, contact your account manager or email our support team.

First, apologies for just throwing up Mark Hurd's email without adding any commentary. I just finished a couple of days vacation with the kids and.....phew, now I'm home and can start to recover!!

Anyhow, did anyone notice the stark difference between BMC's results and HP's? BMC over-achieved on their earnings, and increased guidance.....HP disappointed and reduced guidance. Why you may wonder? They are both dealing with the same customers aren't they?

Well, some personal comments.

First of all, BMC has been constantly cutting costs and right-sizing itself for multiple years. From what I can see they have done a tremendous job of getting the expenses under control and, I know that it is has been tough for their employees for a number of years, but now they are reaping the rewards. Also, they made a couple of big and brave bets. The Remedy purchase a number of years ago has been an absolute gold-mine for BMC and then their more recent acquisition of Bladelogic is a game changer for them. Many people have commented that they overpaid for Blade but, what did they buy? Well, not only did they buy a second engine of growth for the company in a hot space to put alongside Remedy, but they also bought a whole new culture and sales team. Everyone knows that the Blade team has taken over the business unit at BMC and this is probably the biggest single change and dare I say, a major reason for their positive results.

The stories that I hear coming out of HP on the other hand, is that they still think and act like a hardware company. The software sales team does not appear to be "top of the pile" and instead has to follow archaic and complex hardware sales procedures. Try asking HP Software for a quote....see if you can get something back in less than 24 hours. In my opinion, and please remember that these are all personal comments and after all, what do I know....but HP gave up their single best opportunity to change the culture when they tried to integrate Mercury. Why oh why didn't they leave it as a stand-alone business and let the Mercury leadership take over HP Software rather than the other way round. Remember....when BMC acquired Remedy, they left it alone. When BMC acquired Blade, they have given the Blade team the power to get it done.

Anyhow, when you look closer at the BMC results, their growth is all powered by Remedy and Bladelogic. Their Service Assurance business (Patrol etc) is still declining pretty rapidly in a market that has been growing for many years. Let's face it, Patrol and related products (Best1, Performance Manager, Proactivenet and multiple others), are also-rans right now.

And what about Nimsoft's experience? Well, keep in mind that our sample size is relatively small but, we don't see BMC in our deals because they are focused on other disciplines where they have market-leading products.

But, for HP, they are our most-replaced competitor....

I wonder...if other companies are having similar success at replacing HP as much as we are then maybe, just maybe that contributed to their poor results. An eroding maintenance base is never good for business.

Finally, I want to say that these are worrying times for many people. Job losses, salaries and benefits reduced and bad news at every turn. I wish everyone the best - just remember that sometimes the medicine doesn't taste good at the time, but helps cure us in the longer term.

From: CEO, Mark Hurd@hp.com
Sent: Wednesday, February 18, 2009 4:48 PM
Subject: HP Announces Q1, FY09 Results

Employees can access a video replay of Mark?s Q1, FY09 performance review message on hpNOW .
Today, HP announced first quarter results amid one of most difficult economic downturns that any of us has ever faced. I am proud to say that we continue to execute well in this very challenging environment.

We grew revenue 1 percent year-over-year, or 4 percent in local currency, and you need to look at these numbers a little differently this quarter. For the first time in a long time, the dollar was strengthening, so the currency conversion was actually a headwind for us. We also continued to show strong operating leverage with non-GAAP operating profit up 10 percent year-over-year. This was a solid performance, and I thank all of you for your efforts.

But really, Q1 was like a tale of two companies.

HP Services ? as a result of EDS and TS ? had a strong quarter, delivering virtually all of the local currency revenue growth and more operating profit than any other business. It?s gratifying, because this performance was possible because of the hard work we?ve been doing to restructure those businesses.

When you take HP services out of the mix, it?s a very different picture. PSG had revenue down 19%. ESS had revenue down 18%. IPG had revenue down 19%. In fairness, across IT and even other industries, product businesses are struggling in this economic climate. And we did gain share in key market segments. PSG and ESS gained roughly 1 and 3 points of share, respectively. In IPG, quite frankly, we still have work to do across a number of dimensions like inventory, both owned and channel inventory.

In an environment like this, there?s no margin for error and no tolerance for inaction. To give you a little insight into my world, after we report our earnings, we engage in a dialogue with analysts and investors. They?re going to ask what we?re doing in light of the current environment to right-size these businesses.

The math is pretty straight forward. From a productivity standpoint, you?re supposed to reduce headcount on par with declining revenue. If you believe the environment isn?t going to improve, you should take a bigger cut to get in front of the problems. You can do the calculation, as easy as I can. We have about 100,000 people in our product businesses, with revenue down roughly 20%, and an environment that may not get any better in 2009.

I?ll be asked by investors, ?Where?s the job action, where are you taking out this roughly, 20,000 positions?? Well, I don?t want to do that. When I look at HP, I don?t see a structural problem of that magnitude. There are pockets where restructuring needs to happen, and areas where actions will be taken as part of our ongoing workforce optimization process. But at a company-wide level, I don?t believe a major workforce reduction is the best thing for HP at this time.

I think we are fundamentally sound, and when the economy picks up, I want HP to be strong, and to take share and to outgrow the market. I said it last quarter, my goal is to keep the muscle of this organization intact. But we do have to do something?because the numbers just don?t add up and we need to have the flexibility to make the right long-term investments for HP.

So we are going to take action. We have decided to further variablize our cost structure by reducing base pay and some benefits across HP. My base pay will be reduced by 20 percent. The base pay of Executive Council members will be reduced by 15 percent. The base pay of other executives will be reduced by 10 percent. The base pay of all other exempt employees will be reduced by 5 percent. For non-exempt employees, base pay will be reduced by two-and-a-half percent. Additional efficiencies, including changes to the US 401(k) plan and the share ownership plan, will also be implemented. Of course, the implementation of all of these actions is subject to compliance with local laws and regulations. Follow-up communications will detail the timing and the plans in your location.

This does not change our pay-for-performance strategy at HP. If we outperform, and there is a chance we will, then we will increase the total amount of variable pay. In fact, the financial flexibility we?re gaining helps put us in a better position to compete and to win in the marketplace, and fund the bonus program this year based on pre-adjusted salaries. If the company performs well, if our individual businesses perform well and if you perform well, then you could potentially make up the difference with your bonus. I can't promise you anything, but I tell you...there is a chance...if we get this right.

To be clear, these actions don?t make up for all of the decline in revenues. We?re also benefiting from the tough actions we?ve taken over the last few years. People always asked, ?Why are we so focused on getting costs out in good times?? Now?is why that work was so important. We?ve been able to bank some of those savings, and we?re making a withdrawal, which along with the actions we?re taking today, I hope, will get us through this recession.

Again, there are no guarantees. If the environment gets worse, if the downturn lasts longer than we?re assuming, if our performance declines, we?ll have to reassess. But for now I believe this is the right thing for the strength of HP.

I know this is a tough time. But if we get this right, HP can be the kind of company that not only has led, but will extend its leadership. We can emerge from this recession in a powerful position to create value for our customers, our shareholders and our people for years to come.

Thank you.

Mark

Saw this article in the WSJ this morning....Silicon Valley is definitely suffering right now. I live in a small town called Los Gatos, and normally it is somewhat immune from the broader economy (i.e. lots of rich people live here....I just snuck in through the back-door!). But, this time around I've noticed that multiple of the stores in the town have shut-down, there is empty spaces on the high street, we are seeing Short-sales and disclosures and my kids school wrote to us the other day to say that they were likely going to have to reduce their staff as property tax receipts were expected to be lower.

For the tech start-up, it seems as though you are in one of two categories. Either you (a) Have cash, make positive cash-flow and therefore you are a potential buyer of the some of the distressed companies or (b) If you don't have or are losing money, then you are seen as a company that needs to find a buyer. Clearly I am generalizing but you can almost see it in the eyes of the investors and banks - in the first 5 minutes they are sizing you up to see whether you are a beneficiary or the walking dead.

It's very humbling to see what is going on. Fortunately we fall very much in to the first category. We completed additional funding from Goldman Sachs in September last year and we are growing very fast and making money....that means that we are getting lots of smaller companies knocking on our door to see if they "join forces" and we may well take advantage of some of those opportunities if it can help our customers and ourselves.

Anyhow, we have always tried to run a tight ship at Nimsoft which is not always the easiest thing to do with employees "why can't I fly direct rather than taking a connection....it's only $500 more" but it is in times like these that everyone becomes thankful.

Anyhow...read on....


More Tech Start-Ups Call It Quits
As Funding Dries Up, Fledgling Silicon Valley Firms Are Shutting Down; Fears of Chill on Innovation


By PUI-WING TAM and BEN WORTHEN

The deepening recession is speeding up the shakeout in Silicon Valley, forcing droves of start-ups to shut down or sell themselves at fire-sale prices.

Many start-ups survived last year by slashing costs and deferring development projects. But as demand for their products continues to deteriorate and funding dries up, these young firms are now running out of lifelines. Many are calling it quits, recalling the dot-com bust earlier this decade.

'You're going to see a major shakeout,' says Martin Pichinson, a wind-down specialist, above. Jeff Yasuda, below, plans to shut down his music site, Fuzz.com.

In recent weeks, start-ups with names such as Attune Systems Inc. and Reactrix Systems Inc. have wound down their operations. Others including Guava Technologies Inc. have sold themselves off for sums far less than what their investors spent on them.

"Start-ups are failing faster and you're going to see a major shakeout," says Martin Pichinson, a managing director of Sherwood Partners, a Mountain View, Calif., firm that specializes in winding down start-ups. Since mid-January, his firm has shut down an average of three start-ups a week, up from just one or two closures a month in September, he says.

Among the companies that Sherwood is currently closing is Allux Medical Inc. The Menlo Park, Calif., firm, which made devices to treat dermatological problems, had raised more than $11 million in funding. In December, Sherwood also closed down Reactrix Systems, a Redwood City, Calif., interactive media firm that had raised more than $45 million. Mr. Pichinson declined to detail the shutdowns.

Jeff Yasuda, founder and chief executive of San Francisco-based online music start-up Fuzz Artists Inc., plans to shut down his Web site on Friday after deciding he couldn't drive enough visitor traffic to it to make it a viable business.
Turning Out the Lights

As he winds down Fuzz.com, Mr. Yasuda has cut his staff to four people from 12. He still has some money from investors and is working with his remaining staff to preserve a service called Blip.fm, which lets users share short messages about music.

"It's just brutal," says the 36-year-old Mr. Yasuda. "Had the markets been different, I would've been able to raise a lot more capital and maybe I could've given it more of a shot."

The troubles aren't limited to Silicon Valley. VuBotics Inc., an Atlanta maker of software for wireless devices, filed for Chapter 11 bankruptcy protection in November, while nTag Interactive Corp., a Boston maker of high-tech name tags, filed for Chapter 7 bankruptcy protection the day after Christmas.

That such shutdowns have reached tech start-ups shows how far the recession has spread from its Wall Street and housing-sector roots and how it now could slow innovation.

Start-ups are typically where innovative products and services are created, says Richard Mammone, a professor at Rutgers University who has also started several tech companies. In normal conditions, the market rewards the best young companies and only the nonviable ones go bust. But in this economy, "it's not survival of the fittest," he says.

Venture capitalists pulled back sharply in the fourth quarter as credit markets seized and stock markets collapsed. Venture capitalists invested $5.54 billion in U.S. start-ups in the fourth quarter, 27% less than the third quarter, according to data compiled by VentureSource.

Rich Brenner, who runs a Cupertino, Calif., firm that specializes in restructuring start-ups, says this downturn is hurting Silicon Valley companies differently than the dot-com bust, when Internet companies that "should have never been funded" disappeared almost overnight.

This time tech companies aren't at the epicenter of the bust, and failures will take time to play out. Still, "the needle has shifted precipitously in the last six months and now we're starting to see more and more companies strategically stalled," Mr. Brenner cautions.

Attune , a Santa Clara, Calif., software maker ceased operating in December even though employees say the firm had money to keep going through early 2009.

Alan Kessler, Attune's chief executive, says start-ups of Attune's size are highly dependent on partnerships with larger companies and when the markets tumbled, many of those bigger companies "froze."

As a result, Mr. Kessler says he decided the most realistic route for the 25-person company was "to pursue a path to wind down." In November, he announced Attune -- which has raised more than $14 million in funding -- would shut down.

"You fight the good fight and do the best you can," says Mr. Kessler, who last month rejoined 3Com Corp. as a senior executive.

Other start-ups are being pushed by their investors to sell themselves off, even at depressed prices. Jonathan MacQuitty, a venture capitalist at Abingworth Management Ltd. and a board member of Guava Technologies, says he recently encouraged the bioscience company to sell itself.

Demand for Guava's products -- instruments that do cell-based analysis -- have tapered off as pharmaceutical and biotechnology companies reined in their spending, says Mr. MacQuitty.

So earlier this month, Guava agreed to sell itself to Millipore Corp. for $22.6 million; investors had put more than $50 million into the Hayward, Calif., company. The sale price was little more than Guava's revenue, which totaled about $22 million in 2008.

"It wasn't a particularly attractive price but at the same time, if Guava tried to persist, it would have taken a lot of time and money to wait out the current situation," Mr. MacQuitty says.

Overall, 15 U.S. private companies backed by venture capital were sold in January for an average price of $5.7 million. That's down sharply from the average price of $44.2 million that 26 venture-backed U.S. companies fetched in January 2008, according to research firm 451 Group.

For some companies, the shakeout is an opportunity. DemandTec Inc., a San Carlos, Calif., maker of online software for retailers, last month acquired Connect3 Systems Inc., a Cerritos, Calif., start-up that also makes software for retailers. DemandTec bought Connect3, which generated about $8 million in annual revenue and no profits, for $12 million.

Dan Fishback, DemandTec's CEO, says his firm had long been interested in purchasing Connect3 but last year would have had to pay twice as much. Now "it's a buyers market," Mr. Fishback says.

Should be a fun day tomorrow...

First at 11am Pacific Time, we are sponsors of the MSPmentor unveiling of the World's Top 100 Managed Service Providers. Register here to join us, together with MSPmentor, and leading MSPs Fusion Storm and Longview Systems.

Then, at 2.40pm Pacific Time, I am presenting at the Thomas Weisel Technology and Telecom conference that will also be webcast live at this address.

Also jammed full of meetings between these events with various external parties - it's a busy week - Texas and back in a day today!

Yep - we have gone through every single one of the 162 new customers we signed during 2008 and looked at who we competed with and, in the case of a replacement, who we replaced.

Congrats to our friends at HP - we beat them in more competitive evaluations than any other vendor and we also replaced them more times than any other vendor as well. Double first prize....wonder where I should send the trophy to....any ideas?

These messages make my day!


Sachin did an AWESOME job while he was here, thank you very much for coordinating that. We were able to get through our agenda, sort out the outstanding issues and have started our rollout to clients.

Also a special mention for the Support teams, we are very impressed with their focus on resolution and customer service. In addition, the responsiveness of Sachin and the Support team in listening to our feature requests and passing them on to the Dev Team was excellent

Thanks again and we look forward to seeing you and your team again soon

OK, so I'm seriously fed up. I've been on a diet for 3 weeks, working out/running every day and I've not lost a single pound of weight. Darn it!

I love Joe Panettieri's MSPmentor blog......check some of these out regarding Kaseya's CEO....

http://www.mspmentor.net/2008/06/02/kaseya-ceo-gerald-blackie-we-wont-go-public/

http://www.mspmentor.net/2009/02/03/can-kaseya-ever-go-public/#comments

Wow - there looks to be a lot of pretty unhappy people out there - have you read the comments?

In case anyone is wondering, I have never been investigated by the SEC although I did have my tax returns for 2004 audited by the IRS (b*******) and they made me pay extra because, even though I provided them with 2 full boxes of documentation, some receipts were missing.

We've got the MSPmentor100 unveiling coming up on February 11th - tune in for the webcast

It doesn't really mean much in the bigger picture, but Nimsoft has completed a very good January. New sales were significantly increased from January last year (although we didn't do too well in January last year).

Let's hope that this is going to be repeated for the rest of the year. So far, the business forecasts are positive.

Issued our full year 2008 financial results release today. You can see the details here

Also, another new customer video on our site....this time Intellinet

We signed two new customers yesterday including a major airline! Hopefully they'll let us publish their name soon.

Only the second time I have uttered those immortal letters....OMG (the first was reserved for George Michael...for those of you that have not been avid readers of this blog for the last year!).

This time....I was talking to one of our long-term employees (Ken Vanderweel) the other day, and he had a video sitting on his desk - it was of the TV appearance of Converse Software (the predecessor to Nimsoft) that happened over 5 years ago, just as we were starting the company. Funny, because we'd been looking for it everywhere but....as usual, we should have checked Ken's garbage dump (I mean desk!)

Anyhow, here it is - it's actually pretty