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Existence is difficult enough for startups no matter what business they’re in, but it’s even harder for small companies that aim to change the world in fundamental ways. Welcome to the roller-coaster reality of a handful of ambitious entrepreneurs who intend to make the planet smarter. Today, at IBM’s SmartCamp New York City, five startups from the United States and Europe compete for prizes and mentoring sessions from venture capitalists and business leaders. The winner will be invited to a world championship event this fall. Follow this live blog today for a string of insights and video clips that capture the flavor of the competition.

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Raj Aggarwal, CEO of Localytics, a mobile application analytics firm, explains what it means to participate in, and win, the IBM SmartCamp New York City contest.

8:30 p.m.

Jim Corgel, IBM

Announces the peoples’ choice awards, a tally of votes of online participants. More than 2,000 votes. The winner is Envirolytics.

The winner of IBM SmartCamp New York City: Localytics.

The vote of the judges was unanimous.

Gets a three-month IBM executive mentoring program, 25 hours of pro bono legal services from ReedSmith, and 6 months of free office space in New York City from the Hatchery.

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Garrick Utley, president of the LEVIN Institute at the State University of New York, talks about the importance of startups in taking on the big complex problems in the world.

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8:00 p.m. to 8:20 p.m.

David Kidder, cofounder and CEO of Clickable. “We’re the Apple of online advertising tools.”

Three topics:

Data:

“Organizations are getting dumber.”

“The gap between big data and real knowledge is enterprise amnesia.”

“Big Data are insights that make individuals bionic: Better, stronger, faster.”

“Actionable analytics must provide unique powerful insights that must disrupt time and complexity.”

Disruption:

To overcome an incumbent, you need superior usability, cost, ROI, insights, and the ability to change user behavior.

Short of these conditions, “People don’t switch.”

To defend your market, you build moats. Of Google: “What is Android? It’s a 500-mile moat, flaming, that surrounds a search advertising business.”

Startups:

“You need to know why you’re doing this.”

“You need burning, burning drive. Pick something where you can’t sleep at night until you solve it.”

“You have to know what you’re good at and do those things. Don’t try to do everything.”

“You are on a live/die, live/die mode.”

“You should behave as if you’re always in a crisis.”

“You have to make tough decisions decisively.”

“Kill off that project. Get that person out of the company.”

“Don’t waste your time writing a vision statement. Just know what you’re doing.”

Pick a market where there’s a lot of pain. “You have to be a painkiller, not a vitamin.”

“Ignore mentors. Listen to yourself.”

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7:40 p.m.-8 p.m.

Keynote 1; Dennis Mortensen, founder and CEO of Visual Revenue Inc. Formally of Yahoo.

“I used to think that you had to go out and raise hundreds of millions of dollars to change the planet–like Shai Agassi and his electric vehicle company Better Place.”

“I don’t think that any more.”

“What you need is the ability to gather and manage valuable data.”

“The ability to collect and store a lot of types of data is becoming a commodity.”

“I see value in a scenario where you come up with new ideas for collecting new data that nobody else has, and creating insight, and helping people to take action based on this insight.”

At Visual Revenue, they’re creating a mechanism for collecting data about successful online news publishing. Identify successful strategies. Make them easily repeatable.

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6:30 p.m.-7:30 p.m.

The CEOS make their now-polished 6-minute presentations to the audience.

The judges are: Mark Pedretti, partner-chair of ReedSmith’s private equity group; Mitch Leventhal, vice chancellor for global affairs, SUNY; David Blumenstein, co-founder of The Hatchery; and Moni Miyashita, vp of M&A Strategy, Investment & Relationships, IBM.

The CEOs and some sample interactions:

Raj Aggarwal, CEO of Localytics. The mobile application analytics firm helps the makers of mobile phone and tablet applications better understand their clients. By analyzing data on user preferences and tendencies–such as the amount of time spent in an application, errors and crashes–businesses can build more successful mobile applications.

David Blumenstein, The Hatchery: You charge enterprises a basic charge of $899 including 100,000 end users–and charge more as  they add customers. That initial fee seems low.

Raj Aggarwal: As these app makers get more apps online and add more customers, the amounts we collect will go up. These are early days: There will be massively more customers for mobile applications in the future.

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Andreas Wilkens, cofounder of MediaFunnel. The company offers a social media dashboard for the businesses, making it easy for them to manage brand monitoring, scheduling, and multiple Twitter and Facebook accounts.

Mitch Leventhal, SUNY: “You’re at the bleeding edge of social networking. Every time a new service comes in, you have to integrated it into your system. That seems daunting. How do you deal with it?”

Andreas Wilkens, MediaFunnel: “We have to work quickly.” The new version of our software  will have a different architecture that makes it easier to add new services rapidly.

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Marco Brini,CEO of EnvEve. His company offers wireless sensor network technology aimed at providing low-cost solutions in three areas: natural hazards detection, smart cities and industry safety.

Moni Miyashita, IBM: About the operating system. Is it a platform, or does it have to be rewritten for each application?

Marco Brini, EnvEve: Now it takes 15 days to port an application onto the operating system. In the future, we hope to be able to do it in one day.

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Patrick Leslie, CEO of  Envirolytics. The company’s software makes it easy for individuals to perform home energy audits by using smartphones. The software then markets energy efficient products and services to homeowners.

Moni Miyashita, IBM: How do you monitize the solution?

Patrick Leslie, Envirolytics: The product is free to consumers. The distribution channel is banks. The product will help them attract customers who are interested in “green mortgages.” The banks will pay Envirolytics.

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Nilanjan Sen, CEO of Examville.com. The company is a global online education platform where teachers, tutors, test preparation outfits and education publishers can connect with students around the world; and where students can custom-design the learning program that’s right for them.

Mark Pedretti, ReedSmith: How is your solution different from that of your competitors.

Nilanjan Sen, Examville.com: Most of the competitors just distribute their own content, in monolithic pieces. We distribute content from many sources, and we deliver it to learners in the forms that are most useful to them.

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6:15 p.m. The two-day SmartCamp event starts up again at the LEVIN Institute, which is part of the State University of New York. About 150 people in the auditorium.

Jim Corgel, general manager of IBM ISV and developer relationships worldwide: He says this is about helping to build IBM’s Smarter Planet ecosystem. “New York is a hot place to be if you’re building a business and want to change the world.”

“What in the world is Smarter Planet? It’s not an advertising campaign. We’re not trying to be cute. This is very serious business.”

Factoid: 100 million people worldwide are pushed below the poverty line by personal healthcare expenditures.

“This is not your father’s back office computing project.”

“These are big, complex problems.”

Factoid: By 2050, city dwellers will be 70% of the earth’s population.

“Those cities that do a better job of being smarter are going to get more of our money.”

The Smarter Planet ecosystem: entrepreneurs, government, research institutions, customers, IT professionals, media, analysts, business partners….

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Richard Heitzmann, managing director of FirstMark Capital, a New York City venture capital firm, talks about the environment for Smarter Planet-style startups.

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The IBM SmartCamp New York City event kicked off yesterday with CEOs from five Smarter Planet-style startups giving 10-minute pitches to about 25 business leaders. Then each CEO sat down for half an hour at each of five tables surrounded by the business experts. The experts peppered the CEOs with questions, and visa versa. Today, the event kicks off with a panel of seven venture capitalists trading ideas with the CEOs. Here’s yesterday’s live blog.

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3:00 p.m.

Signing off for now. Check back at 6 p.m. for a continuation of the SmartCamp activities.

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2:15 p.m.

Each CEO makes a 6-minute presentation.

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Patrick Leslie, CEO of  Envirolytics

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The venture capitalist panel

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Entrepreneurs

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2:05 p.m.

Q: How do you value sweat equity?

Bob Greene, Contour Venture Partners: “We meet people when they’re less than a year old. The top five people tend not to be drawing a salary.” He says he wants to see the entrpreneurs come up with an estimate of what their contribution is worth.”We look at it and we accept it if it makes sense.”

“What you take in compensation, you give up in equity.”

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2:00p.m.

Q: How big do you want your portfolio companies to get?

Rick Heitzmann, FirstMark: “We ask, is this going to be big enough to be a public company at some point?”

Phineas Barnes, First Round: “A smaller fund allows some options, but for every dollar we’ve invested we see 30 dollars follow. So you look for an idea and value that can scale.”

Bob Greene, Countour Ventures: “We want to be able to sell into the sweet spot of M&A. There are a lot of opportunities to sell a company for from $130 to $150 million.”

He says only a dozen VC-backed companies last year exited into an IPO or  M&A valued at more than $250 million.

“I think in the late 1990s venture capitalists keep the founders too poor. We didn’t let them sell a bit of stock so they could payoff debt and live a little better. It led to people making some sub-optimal short-term decisions.”

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1:45 p.m.

Josh Cohen, City Light: “The speed of data is more impressive than the vast amounts of data. School districts, for example, have up to date information about how their students are performing.”

Bob Greene, Countour: “Big data started off being a big thing for the Wall Street firms. Now, we’re sitting right next to Madison Avenue, the capital of advertising. Now big data is a big thing for advertising. It’s moving from industry to industry.”

Canice Wu, Plug ‘N Play: “How do you take that huge amount of data and convert it into something that’s valuable for companies?” Your have to figure out who can aggregate data and how they can offer value to their end customers.

Neeraj Agrawal, Battery: “What we’re looking for is great teams and great business ideas. If you have both of those we’re really interested. If you have only one; not so interested.”

Bob Greene, Countour: “We want to see startups have a social business angle as well as a data angle.”

Josh Cohen, City Light: “We want people who have solutions to big problems.”

Phineas Barnes, First Round: “Collect the data. Take action. the next wave is turning the art of the data scientist into a commodity. You can press a button and it happens. You get the answer back immediately and can make a decision.”

“We’ve seen software as a service and platform as a service. Analytics as a service is a big opportunity, too.”

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1:30 p.m. Introductions: The VCs are Neeraj Agrawal of Battery Ventures, Phin Barnes of First Round Capital, Josh Cohen of City Light Capital, Bob Greene of Contour Venture Partners, Rick Heitzmann of FirstMark, Robert Johnson, of New York Venture Capital Association, and Canice Wu, of Plug and Play Tech Center.

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