TECH TALK—Work During Convention Opens Doors for Dot-Com

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On the heels of hosting the official delegate Web site for the Democratic National Convention, Event411.com announced it has received $16 million in funding.

The Marina del Rey-based company received a lot of attention for its role during the convention. The site, at DNC411.com, allowed delegates and other people associated with the confab (but not the general public) to keep track of their schedules and all the events being held during the week, among other features.

“I think there’s no question that it was a feather in our cap,” said Steven Koltai, founder, chairman and chief executive of Event411. “Our initial estimates are that almost all of the staff and well over two-thirds of the delegates used the tools at one time or another, either prior to or during the convention.”

The Democrats’ convention has opened many doors for the company, which made a significant number of contacts with people in the corporate and nonprofit worlds. Koltai expects many of those contacts to suggest using Event411’s services for upcoming events in which they are participating.

Meanwhile, the company will use its new funding to beef up its technology and product line, which also includes online wedding planners and gift registries. The company already counts The Washington Post, Boston Globe, and retailer J.C. Penney Co. as clients.

This second round of funding comes about a year after Event411’s first round of $14.5 million.

The investment was led by CB Capital LLC, a venture capital firm based in Portland, Ore. Additional funding was provided by Gannett Co. Inc., the media organization, and WI Harper Group, a high-tech venture firm.

Ups and Downs at Soundbreak

Life at Soundbreak.com seems to be a roller coaster.

On Aug. 30, the online radio network announced that Chief Executive Lisa Crane had been replaced by Paul Ryan, previously the company’s chairman. The reasons for Crane’s departure remained mysterious as of late last week; a spokeswoman declined to comment beyond the terse statement that Ryan is now in charge.

Crane’s abrupt departure is all the more surprising given that Soundbreak seemed to be on a tear since the online radio network announced Aug. 24 that it would pay licensing fees to the Recording Industry Association of America.

“It’s only been a week, and we have two major labels coming in today, and six or seven others that are saying ‘Let’s go,'” Crane told the Business Journal just a day before the announcement of her departure.

The RIAA deal is something of a coup for an online radio network, because of an ongoing debate over royalty payments. The RIAA, which represents music labels, and the Digital Media Association, a group of online entertainment providers including Soundbreak, have been doing battle over paying artists who perform the music played on online radio stations.

The two sides are set to enter several months of arbitration that will result in a licensing fee schedule being established. Once a rate is determined, the sites will then have to pay musicians those fees retroactively.

With such contention over the issue, West Hollywood-based Soundbreak faced many challenges before it penned the RIAA deal.

“We believe that the labels were a bit standoffish about making deals with us,” Crane said. “Obviously, they’re on the other side of this arbitration, and they kind of said, ‘We can’t enter into a comprehensive deal if you’re not licensed.'”

Now that it has its own deal, Soundbreak will be bound by that contract and will not be bound to pay the retroactive fees that will be determined in the arbitration.

Soundbreak has also signed deals with publishing groups BMI, ASCAP, and SESAC. Those deals give music publishers a licensing fee, while the deal with the RIAA will give fees to the artists who perform the music that is played over the Internet.

WWW.com, an Irvine-based online radio network that focuses on leasing its online stations to other businesses, has penned a similar deal with the RIAA, as have smaller online radio sites.

“We’re certainly the largest consumer site by far that has made a deal with them,” Crane said.

IPO on the Way

Adexa Inc., a local provider of e-business software, has registered for an initial public offering with the Securities and Exchange Commission.

The registration came on the heels of a $20 million series “C” round of funding. Investors in that round included J.W. Seligman & Co., which led the funding, Amerindo Investment Advisors, Vitria Technology Inc. and DRW Venture Partners (an entity affiliated with Dain Rauscher Wessels, which will co-manage the IPO).

Staff reporter Laura Dunphy can be reached at [email protected]

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