CAD for the Rest of Us

Company: Right Hemisphere

HQ: Fremont, CA, with an R&D center in Auckland, New Zealand

Founded: 1997

Management: Michael Lynch is the chief executive officer. He was previously at 7th Level, a developer of video games. Mark Thomas is president, chief technology officer, and a co-founder of the company. He previously founded CADTech, a New Zealand-based CAD reseller. Earlier this year, Right Hemisphere appointed Robert Eve as vice president of worldwide marketing. Eve held senior level posts at several companies, including Mercury Interactive, PeopleSoft, and Oracle.

Investors: The company received Series B funding of $12.5 million from Sequoia Capital, Sutter Hill Ventures, and graphics-chip company Nvidia in April 2005.

Business Model: Right Hemisphere’s software allows companies to turn their complicated engineering data and processes into displays suited for interactive training, technical documentation, and marketing communications. For instance, its product might translate an aircraft manufacturer’s complex designs into visualizations and computer-generated animations. What’s more, the software works with Microsoft Office, allowing 3-D files to be dropped into Word and Powerpoint files, or a PDF document using Adobe Acrobat. Right Hemisphere’s target markets are the aerospace, defense, automotive, construction, and industrial equipment industries. For digital artists and graphics professionals, it also offers a free software product, Deep Paint, which enables textured painting on digital images.

Competitors: Informative Graphics, Actify, Spicer, Immersive Design, Lattice3D

Dirt: Companies such as Right Hemisphere have emerged as an adjunct to the computer aided design (CAD) software industry. Developers who work with CAD software are accustomed to its complexities, but the rest of us don’t want to have to learn a new language. Thus, the aim of companies in the 3-D viewing sector is an expansionary one: to give non-technical users the ability to integrate and manipulate complex graphical data in everyday software applications.

Right Hemisphere’s recent cash infusion from blue-chip investors such as Sequoia Capital and Sutter Hill Ventures is a sign of the ongoing optimism in both the company and sector – but we’re still not waiting on overnight success stories. To date, the 3-D viewing business has matured very slowly. Competitor Informative Graphics, for instance, was founded in 1990, and Spicer dates all the way back to 1983. (Did they even have software companies back then?)

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A Fuzzy Image for Internet Video

Internet video once lured many smart investors into squandering their fortunes, but now many have been scared off – and other alarm:clock news from the land of private venture funding.

Internet video has long intrigued entrepreneurs with its potential. In today’s revived, post-bubble startup market, though, there’s surprisingly little financial or entrepreneurial activity focused on launching new Internet video products. Sure, Microsoft, Apple, Real, and others have developed video players. And Google recently launched a Beta version of video search and the peer-to-peer video-sharing standard BitTorrent has become a cult hit. But few players can boast of winning big in the Internet video arena.

A few years ago, a number of stars from the early Internet decided to make Internet video their next stand, including the founders of Netscape and Macromedia. Their projects have been a slog, though. And we suspect they now wish they’d rested on their laurels.

We recently viewed a demo of a video portal from Netscape alumni Mike Homer and Mark Andreessen, called the Open Media Network (OMN), which is a not-for-profit outfit. Site visitors can access a free program guide to download public TV and radio programming, movies, podcasts, and video blogs, and even submit video.

While OMN seems reasonably promising, it’s powered by Homer and Andreessen’s for-profit, venture-backed company Kontiki, which has been slow to find its footing. Kontiki is a content management software platform developed to disseminate video as cheaply as possible. Currently, it has trials underway with the BBC and NBC.

However, Kontiki’s last round of financing was an $8 million investment in December 2004, and it included just one VC firm, the Barksdale Group, which has since disbanded. Since most owners of video content have had a hard time monetizing their assets via the Internet, companies like Kontiki, which are in business to help them do so, continue to struggle.

Another struggling Internet video startup is Akimbo, which offers a TiVo-like service, delivered via a broadband Internet connection, that allows viewers to watch Internet videos on a TV. A scathing review of its TV-via-the-Internet product in the New York Times called it “a train wreck…It might just walk away with High-Tech Turkey of the Year.” Despite an investment from Kleiner Perkins, whose partner William Randolph Hearst sits on Akimbo’s board, Akimbo appears to be a loser, unless it can dramatically improve its value proposition.

Two Web video companies with brighter prospects are CinemaNow and iFilm. CinemaNow offers video downloads to PCs and, like Netflix, charges a subscription fee. Unlike Netflix, though, it offers popular adult films as well. CinemaNow’s investors include Menlo Ventures, Microsoft, Lions Gate Entertainment, Cisco Systems, and Blockbuster.

IFilm is similar to CinemaNow, but has taken a more “guerilla” approach, serving up popular Internet video clips (think Steve Ballmer dancing), music videos, and video games, in addition to feature films. iFilm claims to have been profitable for the past couple of years. And it’s backed by an impressive roster of investors, including Eastman Kodak, Sony Pictures Entertainment, Yahoo!, and Vulcan Ventures.