Funny enough, the CEIM which helps startups in very specific domains by provinding an incubator-style environment, is complaining about the lack of startup financing. I knew about CEIM but what I didn’t know is that it’s been around since 1996. I find it a little sad that they do not promote their services actively by attending social events. Then again, maybe they do and I just never had the chance to talk to anyone working there.

The round was led by Waltham, MA-based Commonwealth Capital Ventures. Existing investors, including JLA Ventures and Desjardins Venture Capital, also participated in the round. The funds will be used to accelerate the company’s marketing and engineering activities.

I had the chance to speak with Mark (Tungle’s CFO) sometime ago and had told him that Tungle was targeting a very problematic issue in the corporate world. This is something that a lot of people can’t see but it’s very hard to setup meetings involving multiple companies. If I were Microsoft (or even Google), I’d keep an eye on these guys.

My feeling is that VC’s tend to wait for the deal of the century in order to throw in as much money as possible in order to get a large part of the pie. While this might work for some industries (Pharmaceutics for example), it no longer works with the Internet industry. A few months ago, the BlitzWeekend project proved that a great concept/prototype could be designed and created in less than 48h. Many people were skeptic but in the end, very interesting prototypes were indeed demoed to the attendees and a judge team.

The facts are plain simple:

• We don’t need expensive Sun servers
• We don’t need expensive bandwidth
• We don’t need expensive Oracle databases
• We don’t need expensive phone systems (PBX)
• We don’t need expensive Aeron chairs either

• We only need money to pay salaries.

Of course, that’s exaggerating of course but that’s how cheap it is to start a business nowadays.

Guy Kawasaki spent 20k on Truemors (one of his startup) and I think he paid too much for it. A big chuck of it was on legal fees actually. Being a VC himself, we can’t blame him for not covering that area. He’s probably used to deal with lawyers.

Everything is in the cloud these days. You can host your web servers and your database online. You don’t even need a physical office anymore. Everything is becoming virtual, even assistants! My prediction is that there will soon be toolkits (like Yahoo Pipes but more advanced) to develop your own online business for a low monthly fee. Everything from code to design to marketing will come out of the box. The worse thing? I’m pretty sure someone is working on this as we speak..!

It’s becoming that easy!

Will we see a change in the way VC’s work with Internet companies? Will we see them leave the Internet industry to focus on other larger industries? It remains to be seen but I believe they must adapt or die.

The way I see it, VC’s must become startup centers where you bring your ideas. If you are accepted, then they will match you with other people so you can use their skills (to fulfill your lacks). You will be able to use their network and office space (if needed) for a few months until your product is ready. A super incubator in some way. That would be nice and we would see way more great companies. Maybe not all rock stars like Google, but a lot of damn good companies for sure. If I were a VC, I’d be working on this right now.

iNovia is recently well know for investing 2 million dollars in StandoutJobs so the BlitzWeekend committee is very excited to have them on board.

Just as a reminder for people who don’t know what BlitzWeekend is: it is going to be an event where teams will work on a project. Projects can be web-based applications, desktop software, widgets, mobile apps, games, hardware etc. This is however a very limited list and we welcome teams with fresh ideas. If you solve a current problem, if your idea is innovative, if it involves building new tools, then it’s probably a right fit for Blitzweekend.

Please pre-register ASAP as space is limited.

From my experience, I believe that starting a business is 80% of yourself (your time, efforts, knowledge, promotion, selling yourself, etc.) and 20% money. That 20% money actually helps you move closer to the 90/10 as you can delegate some work to other people (since you now have money to hire someone). When you get a lot of money (big VC deal) then you can work 100% on the project while not having to worry (too much at least) about money.

So why get $5M if you don’t really know what to do with it? It’s definitively welcomed when you want to expand aggressively, but it is too much money just to come up with a deliverable product. Sure, I’d like to have the latest clustering / blade system and a big SAN but why now? These days, it seems like big guys are buying smaller guys so why worry about growth? Let the big guys worry about it when they’ll buy you. They have the money anyway. If you really need storage, consider Amazon’s S3 (Twitter is using it), DabbleDB or even Google base (entire sites are using it). If you need bandwidth, consider unmetered hosting.

Kevin Rose for example, started Digg with $2000, a web developer working for $10 per hour, and a $99 per month hosting plan. They did raise some money (at least $8+M) but now they have a much larger team and a lot of salaries to pay…