Sample from Spongecell's Ad Gallery. Source: Spongecell, Inc. (gallery.spongecell.com)

Sunday’s Super Bowl was the most-watched event in the history of television, but more telling than the number of viewers was the way in which they watched. About 45 percent of Americans who own tablets or smartphones watched the game with an eye on their second screen, conversing on Facebook and Twitter. During the halftime show and in the final minutes of the game, viewers generated over 10,000 tweets per second.

This trend is indicative of the way we’re consuming content every day and a signal to brands on how they should be engaging with their audiences. Brands are connecting with consumers through digital advertising that includes social media features and other interactive components. This increases engagement and connects with consumers in ways with which they’re comfortable. Brand strategies such as rich media ads can feature “like” buttons and selected tweets from Twitter feeds, as well as more traditional media, such as video. This powerful combination creates ads that draw more attention and engagement. The numbers don’t lie: 96 percent of people take notice of these interactive ads. What’s more, these ads can better target relevant demographics with features that are most likely to drive longer interactions and then measure and report consumer engagement in real time.

As a result, rich media advertising is booming. In 2009, rich media ads represented only 11 percent of the display advertising market. That number is up to 30 percent today, and it is predicted that half of all display advertising will be rich media by 2015 and revenue will grow to $27.6 billion in 2016. As ad budgets shrink, agencies are seeking the best exposure for their client’s dollar. Increasingly, they find it in online interactive ads.

On Tuesday, we announced our latest partner company, Spongecell, a New York City-based advertising technology company that turns standard banner ads into dynamic ads with rich media features like video and social media feeds. Clients like Dell, Proctor & Gamble, Volvo, and Kraft are all exploring the possibilities of digital ads, and Spongecell is well positioned to capitalize on this boom in ad tech interest.

Spongecell’s technology platform provides further incentive for boosting traditional banner ads with social media. Their ads use existing banner ad real estate and increase engagement 25 to 50 percent. Most Spongecell ads are generated in 24 to 72 hours, allowing companies to keep pace with the speed of social media. Analytics allow companies to better understand their audiences and increase the effectiveness of engagement efforts.

Safeguard is not new to the Internet and New Media space. Other partner companies in this space include: Beyond.com, Bridgevine, MediaMath, Swap.com, and ThingWorx.

Safeguard led a $10 million Series B financing for Spongecell. This financing will be used to fund Spongecell’s continued expansion into other Internet-connected devices, including smartphones, tablets, TVs, and perhaps even gaming consoles. As social media and mobile technology create a more connected world, companies can build stronger brands by joining the conversation.

At NFTE, we’re dedicated to finding students with an entrepreneurial spirit and giving them the resources to put their ideas into action. Oftentimes, our students have a wonderful street sense that is an innate advantage for entrepreneurs. Our goal is to convert those instincts into businesses and transform students into empowered leaders.

Of course, that’s not easy. At NFTE, we combine an exciting curriculum with experimental practice in order to bring the real world into the classroom. Volunteers with a variety of relevant business and leadership backgrounds speak to our classes and coach the students as they develop their ideas. Trips to business offices and local colleges give students concrete examples of the potential for their skills and ideas.

After serving thousands of students, we have a unique perspective on how to motivate these future innovators. Here are four key steps for teaching the next generation of entrepreneurs:

1. Encourage their dreams. This might sound hokey, but when I talk to students about their ideas, I like to look for the sparkle in their eyes. Many of the students already have passionate ideas for businesses and just need someone to take them seriously. When students get positive feedback, they respond. Whether they want to bake cakes or mow lawns, we validate those ideas and tell students yes, they can build a successful business around their interests.
2. Help implement their ideas. Part of taking their ideas seriously is giving them the resources to put their business plans into action. Our great volunteers and business leaders, like Michael Pearson, the speaker at last Friday’s Youth Entrepreneurship Conference, teach the students financial literacy, components of good management, and even how to create an elevator pitch. Getting a start-up business from idea to real world company is difficult, but our team of volunteers supports students with those first steps.  
3. Teach them to network. Networking is a key for successful entrepreneurs. Once their company is off the ground, students can use their network to find employees, gain support, or explore new markets for their products and services. At our NFTE Philadelphia Visionary Gala, we invited 30 students to join us and talk to guests about their businesses. This is great training for students in how to market themselves and their company, as well as build contacts they may need in the future.
4. Model failure as an opportunity. If you try to start a business, you are going to have to overcome obstacles, potentially even some failures. The real entrepreneurs plow through challenges and learn from them. This concept might be hard for our students to grasp in the context of running a business. In many cases, they have experienced challenges in their lives, and they already know how to learn from their experiences. That’s an invaluable skill for them to have as they start their businesses.

As part of the experiential component of their education, 120 of our students attended our annual Youth Entrepreneurship Conference at the Community College of Philadelphia (CCP) last Friday, which featured two prominent speakers. Dr. Wayne Wormley, Dean of the Business and Technology Division at CCP, delivered a call to action in his opening remarks. Michael Pearson, President of Union Packaging, spoke to the children about his career and how he successfully started his own packaging manufacturing business.

The conference also featured workshops in networking, insurance, financial statements, and information technology to help familiarize students with the fundamentals of running a business. With encouragement, practical skills, and the right mindset, our students could be the next big innovators. We can’t wait to see them get their start-ups off the ground!

NFTE students packed the room to hear our keynote speaker Michael Pearson. Photo Credit: © Daniel Burke Photography.

Michael Pearson tells NFTE students his story of start-up success. Photo Credit: © Daniel Burke Photography.

Credit: CBS Interactive

All advertisers have the TV in mind when it comes to connecting with consumers, and not just through your typical Super Bowl advertisement. Television will one day become a center for engagement and interactivity, for which we’ll have Smart TV to thank.

One of the big stories out of this year’s Consumer Electronics Show (apart from PixelOptics’ electronic focusing eyewear, emPower!) was Smart TV—a concept that’s been around since 2008, but is just starting to catch on. These TVs are Internet-connected devices that integrate social media, smart search, apps,  Internet content streams (like Netflix or Hulu+), and other content to offer a more interactive experience for users, one that will ultimately change the way people consume content like TV shows.

Large TV manufacturers are now deploying their own Smart TV platforms, and advertisers are scrambling to have their apps featured on the platforms’ coveted launch page. The industry projects millions of these TVs will be in homes by the end of the year, with sustained growth expected.

While this is an exciting space for consumers, it’s also of particular interest to Safeguard Scientifics’ partner company, MediaMath, which is paying attention to the advertising opportunities that this new technology offers.

According to Marta Martinez, Chief Marketing Officer at MediaMath, all the major advertisers are already interested in this space. Some electronics companies, like Samsung, have already jumped in. Samsung’s AdHub offers 3-D and interactive advertisements that take advantage of Smart TV’s potential.

Apart from these new ad formats, Smart TVs will help advertisers gather more information about viewers. Up until now, advertisers have gathered data from surveys and Nielsen ratings, which offer only a broad portrait of their audience—for example, the type of person most likely watching the NFL playoffs or tuning into Sunday morning news shows. With motion sensing and social interactivity, Smart TV will offer much more detailed information: how much time you spend consuming different content, your engagement level, and how you interact with the TV.

As a result, they can deliver custom ads to you based on this data. Smart TV technology is at the center of what advertising is about—a deep audience understanding that allows companies to meet consumers where they are and enhance a brand relationship. With this interactivity as the crux of the new system, the way we watch TV will fundamentally change.

Of course many of these personalization strategies have already been implemented in Internet advertising through algorithms like MediaMath’s TerminalOne™ platform. This split between the established algorithms and the potential of the new medium could lead content in one of two directions:

1. The Internet could run cable and satellite providers out of business. We’ve already seen TV content gravitate online through sites like YouTube and Hulu. All the major networks already upload their shows to their websites. With many of the metrics already in place for online advertising, content may follow consumers, who increasingly watch content online. Products like Google TV would thrive as content is streamed straight from online content services to a TV, bypassing the traditional cable, satellite, and broadcast systems.
2. Interactivity could save cable and satellite providers. Despite the trend toward the Internet, if Smart TVs can offer a viable, or flat-out better, alternative to the Internet through interactivity, cable and satellite companies could thrive. With smart cable boxes, manufacturers could keep more consumers in front of their TVs by offering the same level of interactivity and personalized content as the Internet.

As these two approaches push in different directions, Marta and MediaMath are keeping a close eye on them, testing each to see which consumers prefer. At this point the only question remaining is how fast these changes are coming. Based on the way consumers have become increasingly eager to adopt new technology that keeps them connected, MediaMath suspects we will know sooner than we might think.

Last August, I highlighted my five favorite books for CEOs and entrepreneurs. Now, I want to share some of the tools my team and I have found useful in helping manage a business more effectively and efficiently. Something as simple as an app can free up a hectic day so you have time to focus on the bigger picture of running a business, innovating instead of counting receipts.

There is an app for just about everything these days—apps have become portable offices, accountants, and can even teach you how to tie a tie. For many people, smartphones and tablets have become indispensable. Whether their weapon of choice is an iPad or Android device, entrepreneurs can use apps to improve their productivity, better manage their time, and simplify their lives.

I spoke with our partner company CEOs and gathered a list of top entrepreneur-friendly apps. While I found that email and the calendar are probably the most popular and important tools, we picked 10 additional apps that will help tame your schedule, keep you in the know, and translate your desktop to your pocket.

Have a favorite app that we didn’t include? Let us know about it in the comments.

For our first Q&A Series, we interviewed serial entrepreneur Russ Fadel, CEO and Co-Founder of ThingWorx. We had a chance to speak with Russ about his experience as an entrepreneur, his secret sauce for building successful start-ups, and what’s new at his latest company—ThingWorx.

Why did you choose to become an entrepreneur?

When I was old enough to get a job, the only ones I could find weren’t very interesting and paid next to nothing—like buttering toast at a restaurant chain. Instead of settling, I decided to start my own business. So I ran a painting business from when I was 16 until I got out of college.

Once you’ve run a business and you’ve dealt with the challenges and the rewards, it’s hard to imagine going back and working in an organization where you don’t have as much control over your own destiny. I was hooked on entrepreneurship with that first painting business.

To what would you attribute your success?

I think one thing that’s overlooked sometimes is hard work. Hard work underpins all success. If you look at any entrepreneurs who are successful, they’re working 60 to 70 hours a week. When they’re not working, they’re thinking about work. But in addition to that, there are two other factors that success is highly reliant on.

First, it’s important to have good partners. The first thing I look for in a partner is that they have a complementary set of capabilities to what I bring to the table. They also need to have the same vision and passion for what we should be working towards. The second factor to success is deciding what is next for your business.

What is the most important lesson you’ve learned as an entrepreneur?

This echoes what I touched upon earlier—but a big challenge for entrepreneurs is figuring out what the next step with your business should be. At a glance, this sounds simple, but every single day an entrepreneur is faced with more choices than they have the time, or money, to follow, and they have to decide which next step is most important for the business. The problem is that this occasionally contradicts the set business plan. Figuring out where to spend your time and money is vital. The most important lesson I’ve learned so far is figuring out how to manage those two aspects while staying focused on what the business is trying to accomplish.

What’s your biggest business challenge right now?

We already have a great product, so now the challenge is increasing sales and growing our operational scale. The business we’re in crosses over between enterprise sales and not-quite-enterprise sales. We’re trying to turn an enterprise software product into a low-touch sale and that’s new ground for us. We’re not there yet, but it’s a process that we’re undergoing.

As we scale our business, one of the challenges is on the personnel side. It’s hard work to try to leverage your network of employees and business associates to identify good talent. However, we’re fortunate that even though we’re growing rapidly—we have a good-sized employee count right now—we’re still small enough where nearly every employee is either someone we have worked with before, or they were recommended by someone that we’ve worked with before.

What advice would you give other entrepreneurs in the tech space?

I think I’d echo the whole management theme, which is this: solve a problem that’s valuable and hard to do. Once you decide which problem you’re going to solve, build a talented team and stay focused on your goals. Many companies go in and they try to solve problems that are either not valuable or they’re not hard to solve. Others get into business with one idea and they run into an obstacle, lose focus, and start pursuing something else. So solve a problem that’s valuable and hard to do, build a good team, and stay focused in your pursuit.

How do you operate at ThingWorx? How do you motivate your team? What’s the culture like?

We have a team that is far on the right half of the bell curve in terms of capability, so we operate relatively loosely, but organized. Our executive team makes sure our goals and next steps are clear, so everyone is focused on the right objectives. Being a startup means those objectives can change over time, and what was important last month might not be what’s on our minds today. So we try to make sure everyone is aware of our goals so they can do what they do best.

What industries would you like to bring ThingWorx technology to next? Why?

Right now, we’re in about eight different market verticals, and we’re making traction in each of those areas. One of our near-term opportunities is in mobile devices. There’s a lot of attention in that space since wireless carriers all need access to the customer. If they decide on a software platform, everyone on their network is going to use that platform. So we’re focused right now on establishing a better position in mobile.

Healthcare is another booming industry, and we’re working with diagnostics companies—a space outside the regulatory issues that come with patient information. Healthcare is a space that’s very interesting, but right now we can’t spare the resources that we’d need to deal with the friction of the regulatory environment. We’ll be pursuing that space through partners with a better position to deal with that compliance.

Over the past year, more and more people have become interested in the connected-world space. How do you see this sector evolving in the months or years ahead? How are you capitalizing on that increased attention?

First and foremost, I think the space for us is moving more quickly than we expected. We see the connected world as the next age of software and computing, where typically separate spaces such as transportation, manufacturing, healthcare, and equipment, will connect.

Right now there are less than one billion connected devices, and over the next ten years, that number is expected to reach 50 billion. This is really the rapid expansion phase of this connected world, and ThingWorx is in a great position to capitalize on this growth.

What is your “go-to” news source?

I read Google News to get an overview of the world: politics, science, technology, entertainment (which I’m not big into), and sports. I can get a good view of the news in six or seven major categories. Then I go through the tech sources like Read Write Web and InformationWeek.

What’s your “must-have” app?

My smartphone serves my needs through a lot of the native apps. As CEO, I schedule a lot of meetings and appointments, and without the calendar I would be constantly behind. I also use email, but other than that I don’t use many apps.

For more information about ThingWorx, please visit the company’s website (www.thingworx.com) and blog (www.thingworx.com/blog), or you can Follow the company on Twitter (www.twitter.com/ThingWorx).

Stay Tuned for more in our Q&A Series with Safeguard Scientifics’ Partner Company CEOs. Next Up: Beyond.com’s CEO, Rich Milgram.

Long-term venture performance also improved, according to the Cambridge Associates Venture Capital Index. Venture fund returns for the 10-year horizon doubled from the previous quarter. Fifteen and 20-year returns remained stable.

Our partner companies have received notable media coverage and recognition recently. Here’s the latest news:

• This past week, the TV show “The Doctors” featured the BD Veritor™ System, a quick-response flu test powered by our partner company Alverix’s technology. The demonstration shows how quickly the system diagnoses a patient for influenza type A and B. The full video clip can be viewed below:

• Beyond.com was honored with the Future 50 Award, by SmartCEO/Clifton Gunderson. This award recognizes the Greater Philadelphia area’s 50 fastest-growing companies based on employee and revenue growth over the past three years.
• FINS recognized Hoopla Software’s growing workforce (it’s hiring a dozen new employees), and Flying Kite Media featured Hoopla’s innovative sales leaderboard.
• Fox Business featured MediaMath’s CEO Joe Zawadski on Helping Companies Reach Their Customers. The full video clip can be viewed below:

• NuPathe was allowed an additional U.S. patent application for its method of using a patch for consistent migraine therapy. This is a win for NuPathe, as it adds to their current patents and will further protect their unique strategy for fighting migraines.
• Swap.com introduced its new Market App for the iPhone, which allows users to easily upload and browse items and send messages to other swappers without being anchored to a computer.
• Connected World Magazine highlighted ThingWorx and its partnership with Sensei Solutions to better monitor smart grids.

We’re also pleased to announce that our own Stephen T. Zarrilli was named Vice Chairman of the Board of Directors of the Ben Franklin Technology Partners of Southeastern Pennsylvania, an organization that offers resources and networking for both the region’s entrepreneurs and established businesses.

To read more of our Week in Review series, please use the following feed: www.safeguard.com/WeekInReview. Enjoy your weekend!

Further information released today noted that companies increased their cash and short-term investment balances in the fourth quarter of 2011, according to the AFP Corporate Cash Indicators™ (AFP CCI), a quarterly study that measures recent and anticipated changes in U.S. corporate cash balances. Quarter-to-quarter, 49 percent of reporting organizations had greater cash balances at the end of 4Q11 than they had at the end of 3Q11.

Many of these businesses are criticized for not investing more cash into their businesses, and for prolonging the pain experienced by those still unemployed. But many of the organizations criticized are the same companies that were required to rebuild their balance sheets over the past decade—during the recession caused by the tech bubble burst in 2000, which created carnage in a wide number of businesses.

As these cash balances build, shareholders are seeking answers about what will be done with the growing balances. Some suggest stock dividends or share repurchases, which are legitimate suggestions to be considered in a framework of multiple options and scenarios. The reality is that businesses are prudently waiting for greater clarity on longer term economic conditions and worthwhile strategic investments before committing for the long term.

We have groomed a highly talented group of executives in our country that have the benefit of experience through multiple business cycles and understand the dynamics at play. There are still many opportunities to pursue, and I believe we have a great combination of resources and experience here in Corporate America to capitalize on those opportunities. Couple this perspective with the reality of the ever increasing sophistication of technology and certain infrastructures within our world, and you get a picture of the future that offers substantial opportunities to put such capital resources to work.

We at Safeguard Scientifics continue to see a strong pipeline of opportunity for the deployment of capital. We do think this is an indicator of the overall strength of innovation and risk-taking being pursued in the market and we are excited about this trend. While there are still concerns about the macro-economy and the direction of new regulations, we believe we are witnessing a period of tremendous innovation that will help refine and re-shape many industries over the long term.

CES typically hosts previews of gadgets and new product announcements, and each year some big trends emerge—last year was dominated by tablets and 3-D TVs. In 2012, CES-goers had their fill of faster and bigger smartphones, ultra-thin laptops, and Web-connected TVs. As more and more of our content streams from the web to our TVs and mobile devices, video content will continue to explode. As a result, streaming video to personal devices is expected to create completely new advertising opportunities, which many of our partner companies are capitalizing on.

Last but not least, a pair of revolutionary eyeglasses were all-the-craze at this tech megaconvention. Attendees were surprised to find eyeglasses in the maze of gadgets, but the confusion soon turned to amazement as CES attendees tried on a pair of PixelOptics’ next-generation spectacles—emPower!. Featuring the most significant technological advance in prescription eyewear in the last 50 years, there was tremendous media coverage about emPower! and PixelOptics—New York Times, The Street, Computerworld,VentureBeat, Los Angeles Times… and Connected Magazine listed emPower! as one of the top 5 freshest gadgets. Prior to CES, PixelOptics named Brett H. Craig President and CEO, marking an evolution of PixelOptics and the emPower! brand. Brett’s 14 years of experience and expertise in the optical industry will be invaluable for future success of the company.

In other partner company news:

• Becker’s ASC Review featured a timely report from AdvantEdge Healthcare Solutions about the extensions of the 2011 physician payment rates and other policies that affect physicians in 2012.
• New partner company Crimson Informatics was recently listed as one of 5 insurance startups to watch by Business Insider. By bringing its UBI software to the auto insurance market, Crimson’s goal is to give insurance carriers metrics based on drivers’ measurable behavior behind the wheel.
• New technology partner company Hoopla Software was featured in a Philadelphia Tech News story about apps that complement and work with the Force.com platform, and can be sold through Salesforce.com’s AppExchange.
• Putney‘s CEO Jean Hoffman held the spotlight as a Women to Watch alumna with much to toast to in 2011 and the year ahead. Both Mass High Tech and Maine Ahead featured stories on Putney’s success. In addition, Putney announced that it hired a Chief Operating Officer and a Senior Director of Marketing to augment the rapidly growing pet pharmaceutical company, which focuses on the development and sale of generic prescription medicines for pets.
• Fortune interviewed Joe Zawadzki, MediaMath CEO, and highlighted MediaMath as the preferred platform for marketers who want to buy ad space through several suppliers, including Google and AppNexus.
• NovaSom‘s AccuSom® Home Sleep Test for Sleep Apnea was featured as part of Verizon Wireless’s booth at CES.
• Swap.com was listed as an effective tool under the top 15 tips for saving money in 2012. A Fidelity Investments survey found that 46 percent of respondents wanted to save more money as their New Year’s resolution, and swapping is one way to do it.
• This week ThingWorx announced a partnership with Sensei Solutions for smart grid management, which positions ThingWorx in industrial automation. There, the ThingWorx platform will monitor assets for smart grid solutions.

Safeguard and our partner companies are off to a great start in 2012. To read more of our Week in Review series featuring recent news and updates, please use the following feed: www.safeguard.com/WeekInReview. Enjoy your weekend!

While healthcare may already be one of the most technologically advanced industries, most of the technology has been applied reactively to develop medical devices and drugs that treat existing maladies or diseases. When it comes to preventive medicine, technology has come up short—which may be contributing to skyrocketing healthcare costs.

Fortunately, we are now seeing technology enter the healthcare and life sciences space to proactively address healthcare issues. Take the iPhone. It represents a ubiquitous consumer product that now has thousands of healthcare apps available, enabling physicians, patients, and consumers the opportunity to quickly and efficiently monitor and discuss health issues.

There was extensive talk at the conference this week about the countless opportunities to improve healthcare by combining mobile technology and medical devices. Mobile connectivity allows patients to be monitored in an entirely different way, providing critical medical information to physicians and caregivers in real time, no matter where they are. Mobile can also help improve chronic disease management, allow for efficient tracking and maintenance of wellness and fitness, and tether doctors and patients 24/7.

Mobile technology provides an opportunity to improve healthcare, but is just one of the advances poised to help healthcare become more efficient. In fact, we may be at a tipping point of the tech invasion of healthcare; it can change the game and allow us to engage health in a more social way. You never know, at this rate, it may not be long before OneMedForum San Francisco and the J.P. Morgan Healthcare Conference are combined with C.E.S.!

This week, Safeguard Scientifics’ life sciences team is in San Francisco attending J.P. Morgan’s 30th Annual Healthcare Conference, one of the healthcare industry’s largest annual meetings. The team is also spending time at partneringONE’s Biotech Showcase 2012 and the 5th Annual OneMedForum San Francisco 2012. Each year I look forward to attending these events; they offer an opportunity to hear what the best and brightest in healthcare have to say about the industry.

One year ago, today, I posted my thoughts about the 2011 J.P. Morgan Healthcare Conference and OneMedForum and life sciences trends for the year ahead. Although the industry has since shifted and evolved, many of the predictions I shared then are applicable to what’s in store for 2012.

The state of IPOs and the impact of healthcare reform cropped up in conversations this year in San Francisco just as much as they had last year. Reimbursement is still a major issue while the “consumerization of healthcare” movement is gaining traction.

But 2012’s conferences also brought new discussions on the latest advances, technologies, and trends – topics that are driving our conversations this week.

Here are the three trends that conference attendees can’t stop talking about:

• Healthcare IT — Technology is poised to help the healthcare industry become more efficient, and healthcare IT is the industry’s current MVP. Patient care can improve, while the cost of healthcare will decrease, due to advances in healthcare IT. The transition to electronic medical records (EMRs) brings us one step closer to this revolution, and life science companies are finding ways to efficiently manage operations through technology.
• Personalized Medicine — This trend can empower and enable patients and physicians to improve healthcare. Customized approaches to prevention and treatment, based on a person’s genetic makeup for example, will result in better health outcomes.
• Diagnostics — The latest advancements in diagnostics are vital to streamlining the healthcare system. Take a look at the recent news from partner company Alverix as an example. Moving testing closer to the point of patient care improves healthcare efficiency by decreasing costs and improving treatment time.

These trends are shaping the future of the rapidly evolving healthcare landscape. Innovations such as electricity, automobiles, television, and computers radically changed the world, and healthcare is on that same trajectory. The healthcare advances today are culminating in what may be the next major transformation of our lifetime.

For real-time updates about conference hot topics such as these, follow @Safeguard and the hashtag #JPM12 for healthcare tweets and conference news on the go. Be sure to come back to our blog for additional coverage on these conferences, and the state of healthcare and life sciences.