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Published on 08/31/1998 All articles from this issue

City a software magnet

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By Carol Lynn Tiegs

Special to the Town Crier

60 firms call Los Altos their campus as they create products to change the world

While semiconductor giants like Sun Microsystems or Silicon Graphics build their campuses, a multitude of software firms have found the perfect setting in Los Altos. "Los Altos is our campus," said Traakan Software president Michael Buschell.

A search of Pacific Bell's Yellow Pages and a Web excursion to www.Yahoo/Los Altos/software reveals listings for 60 Los Altos-based software firms. Their operations cover the spectrum of business stages, including some mergers and acquisitions. Ten of those companies closed in the past year, but new entrants took their places.

You can't easily quantify the number of people involved because many, like Traakan Software and Seer Systems, are virtual companies. They operate with a core of employees on site and any number of contractors around the nation and the world linked via the Internet. As Buschell said, "There are not a lot of people involved, but a lot of people on board."

Now six years old, Traakan started in an apartment, moving to office space on Main Street two and a half years ago. The firm's Greg Andrews said Traakan's software is "like a closet organizer" for files.

"The code is written to adapt to emerging technologies," said Buschell, who envisions the development of cell-phone-size computers.

Self-funded Traakan "has been profitable since day one," he said.

Seer Systems' Reality software turns a personal computer into a full-featured, multiple format synthesizer. Reality 1.0 has been on the market just over a year. This summer, Seer Systems released Reality 1.5, which allows a composer to put full compositions on a Web site that can be played in real time.

Games were one of the earliest general appeal software products. When Los Altan Jon Freeman and a friend started writing computer game programs in 1978, "there were hardly any computer stores or game companies to help sell them, so we started a company," he said.

Freeman and his wife Anne Westfall started FreeFall Associates in 1980. Their current project is a series of card games using Thrall, a card deck Freeman invented and is patenting.

Several other local software firms began in the infancy of computers, recognizing the need to build computer literacy.

Baytek founder and president Judy Thornell was the controller for a Menlo Park firm in 1982 when she started using Peachtree's DOS accounting software. She opened her Los Altos firm in 1990 as the authorized Peachtree training and support center for the San Francisco Bay Area, Monterey Peninsula and Las Vegas.

In April, Baytek announced the opening of a software support help desk that provides support on more than 100 of the most popular software titles.

Founded in 1980, Los Altos-based EMA Software started as a computer training business. The firm offered courses at the former Terman Junior High in Palo Alto in their own 15-station computer lab.

"Very few locations had such a facility back in 1980," said EMA president Robert Enenstein. "EMA taught classes in computer literacy, programming and business applications. We were one of the first to offer teacher-training classes through San Jose State University."

In 1981, EMA released its first software product, Gradebook Plus. The award-winning program enables teachers to easily track student's grades and produce reports for parents. Soon to be released in its eighth generation, Gradebook Plus is used by over 200,000 teachers worldwide, Enenstein said.

EMA also performs custom programming for schools, small businesses and corporations. The Web site EMA designed and maintains on a voluntary basis for Montclaire School was featured on NBC News, Enenstein said.

In 1985, AutoCAD, now the industry standard for computer-aided design software, had just been introduced. As an interior designer, Jodie Gebhard, saw the potential for computer-aided design. "But," she said, "it was the beginnings of computers. I saw a need for training and consulting because no one would bother with a computer program that meant frustration."

Gebhard's company, ID8 Media (formerly CADesign), sells computer design programs to architects and designers, and provides training in how to use them. "We take the intimidation out of computerization," she said.

Robert Heffley of Robert Heffley Engineering and RHE Computer Services in downtown Los Altos, is an aeronautical engineer who says his main business is engineering consulting. He also does software development for NASA and the U.S. Army related to the large vertical motion simulator at NASA's Moffett Field site.

"Software development in the last 10-15 years was enabled by desktop computers," Heffley said. "Formerly it was dependent on large, expensive main frame computers."

Among Los Altos software development firms 10 years is an eternity. Most, like Traakan, are two- to four-years old, privately funded and targeted in focus. Many, like Agorics, Inc., are the result of friends or colleagues coming together around a common interest.

Formed in 1994, Agorics' work has been focused on electronic commerce applications, according to its president Ann Hardy. Most recently, Agorics worked with IBM to develop IBM's echeck bank server, an Internet payment product based on the Federal Services Technology Consortium's echeck standard. Agorics developed the security software to enable the electronic check transactions now being tested by NationsBank and BankBoston.

"We are in the process of raising money to support completion of development and marketing in anticipation of announcing the product in the fourth quarter of 1998," Hardy said.

Los Altos startup software firms include LCG Consulting/Anju Technologies. "We specialize in software for the electric and gas industry, said the firm's Roger Deb. The firm offers software products and consulting services on utility planning, operations, pricing and strategies, and regulations.

Three-year old A Bit Better Corp. is primarily a software consulting firm. But the "more fun" side of the business, said Dennis Austin, is clip art software featuring Screen Beans characters. Company founder Cathy Harris, a graphic artist, developed Screen Beans and sold her former employer, Microsoft, a license to distribute the characters through Microsoft Office, Austin said.

BITSource, Inc., a two-year old Los Altos firm, provides solutions enabling computer distributors and resellers to deliver software electronically to their customers. A patent is pending on the company's SmartLicense electronic volume license certificate technology.

Another niche software supplier, six-year old Electric Software Production, provides environmental software used by power and cement companies to measure their emissions and demonstrate compliance with clean air standards.

"We started doing work for the Electric Power Research Institute as a support function for them," said president and founder Alex Long, "helping them commercialize their products."

Envision Software, Inc. provides software for the direct marketing industry, according to Christian Holtzman. System components include a call center that gives service representatives quick access to product and promotional information. There are also components for business analysis, warehouse/supplier management and financial management.

Intraspect offers enterprise-wide knowledge management software. "It's a way to capture, store and reuse intellectual property within a company," said Intraspect's Nancy Patton.

Founded in 1995, Intraspect released its first product in 1997.

Founded in 1996, Intr@vision launched its Virtual Proposal Center software this January. The product is an intranet/Internet application that gives distributed proposal teams a common work center with shared, up-to-date proposal information.

PixelSoft on First Street offers PIKS Foundation, a basic set of software services for image processing software developers. PIKS serves as a building block for creating imaging applications in fields such as animation, medical imaging and remote sensing.

And seven-year old Waterwheel Software on Main Street produces tool and equipment control software for the construction industry.

"Hardware doesn't live unless people like us build the software," said Traakan's Buschell. "The future is in software."