WASHINGTON, D.C. - Like the private sector, the U.S. federal government is bullish on technology for keeping better track of stuff. Take the Department of Defense’s supply-chain experimentation with radio frequency identification, or the Federal Aviation Administration's push to usher in satellite-based air traffic control.
One venture-backed company looking to cash in here: Ekahau. The Saratoga, Calif., outfit, 65 employees strong, sells systems that track goods using wi-fi technology. Wi-fi, for anyone wondering, refers to kind of wireless local access network--the kind you use at Starbucks to surf the Internet on your laptop.
In terms of its business, 15% of which comes from customers in the public sector, Ekahau is targeting physical spaces much bigger than a coffee shop. Example: Hill Air Force Base. Located in northern Utah, Hill employs thousands and is home to seven U.S. Air Force wings. Its Ogden Air Logistics Center does maintenance and overhaul work on hundreds of F-16, A-10 and C-130 aircraft each year, as well as engineering and logistics management for weapons such as the Minuteman intercontinental ballistic missile.
The Air Force has a keen interest in better ways to manage the gear involved in all this upkeep. The faster mechanics get the tools they need, the faster planes get out of the hangar and back into service.
A year ago, Ekahau's tracking system was chosen for a related pilot project at Hill by Knowledge Based Systems (KBSI), a contractor to the Air Force. The company slapped Ekahau tags (see box image) on scissor and wing lifts, stands, dollies and other equipment relied on by Hill's repair staff. Ekahau's software, known as the Ekahau Positioning Engine, managed location information flowing from the tags, as well as laptops and PDAs carried by Hill personnel.
"The pilot went very well," says Michael Graul, a senior research scientist with Knowledge Based Systems. "We were able to pick up within 15 feet where an item was."
Full story at Forbes.com
Thursday, April 26, 2007
Tuesday, April 24, 2007
Beltway Money Man: Jon Kutler
Being buried alive can change your view of making money.
Prior to December 2005, Jon B. Kutler fit the profile of the hard-charging investment banker. A Harvard business school grad and founder of a successful aerospace and defense boutique, he had worked on hundreds of deals. Long hours and constant travel were his companions--and fond ones, given the money he made.
One afternoon in December 2005, though, Kutler found himself under six feet of snow, buried by an avalanche on the last run of the day during an Austrian ski vacation. It took 45 seconds for him to pass out and 20 minutes for rescuers to dislodge his head. By the time he reached the hospital, his body temperature was 89 degrees.
"Your life flashes before your eyes," says Kutler, 50, of those 45 seconds of consciousness trapped beneath the snow. "None of my thoughts related to investment banking."
So in March 2006, Kutler turned a new chapter. He quit the banking outfit he had started, sold in 2002 to New York's Jefferies Group, and turned his attention to private equity. He put up $70 million of his own money to found Admiralty Partners.
But in contrast with today's private equity environment, where big players are raising billions and closing massive deals, Kutler had no intention of building another financial empire. "I rarely travel," he says, "except for vacations."
Out too are the long hours at the office. In their place, Kutler says he substituted more time doing charitable work with his wife and more attention to their two teenage kids. A U.S. Naval Academy grad who majored in engineering, he became a trustee of the California Institute of Technology. He also helps oversee the Jet Propulsion Laboratory, NASA's center for robotic research of the solar system, which Caltech manages.
The scaled-back schedule means less time for scrutinizing deals. With Admiralty, Kutler gets plenty of pitches sent his way but invests in just one or two a year. His targets are usually companies with sales in the range of $25 to $250 million.
Full story at Forbes.com
Prior to December 2005, Jon B. Kutler fit the profile of the hard-charging investment banker. A Harvard business school grad and founder of a successful aerospace and defense boutique, he had worked on hundreds of deals. Long hours and constant travel were his companions--and fond ones, given the money he made.
One afternoon in December 2005, though, Kutler found himself under six feet of snow, buried by an avalanche on the last run of the day during an Austrian ski vacation. It took 45 seconds for him to pass out and 20 minutes for rescuers to dislodge his head. By the time he reached the hospital, his body temperature was 89 degrees.
"Your life flashes before your eyes," says Kutler, 50, of those 45 seconds of consciousness trapped beneath the snow. "None of my thoughts related to investment banking."
So in March 2006, Kutler turned a new chapter. He quit the banking outfit he had started, sold in 2002 to New York's Jefferies Group, and turned his attention to private equity. He put up $70 million of his own money to found Admiralty Partners.
But in contrast with today's private equity environment, where big players are raising billions and closing massive deals, Kutler had no intention of building another financial empire. "I rarely travel," he says, "except for vacations."
Out too are the long hours at the office. In their place, Kutler says he substituted more time doing charitable work with his wife and more attention to their two teenage kids. A U.S. Naval Academy grad who majored in engineering, he became a trustee of the California Institute of Technology. He also helps oversee the Jet Propulsion Laboratory, NASA's center for robotic research of the solar system, which Caltech manages.
The scaled-back schedule means less time for scrutinizing deals. With Admiralty, Kutler gets plenty of pitches sent his way but invests in just one or two a year. His targets are usually companies with sales in the range of $25 to $250 million.
Full story at Forbes.com
Wednesday, April 11, 2007
A Happy Birthday For The Forbes Beltway Index
A year ago this week, Forbes.com debuted the Forbes Beltway Index, our means of tracking the stock market fortunes of just over 100 public companies that either do significant business with the federal government or benefit from federal law.
One rationale for the index is that a solid business rapport with Uncle Sam is a positive indicator for investors. Federal statutes, for example, occasionally shield companies from competition. And big contractors can depend on a steady flow of government dollars when the private-sector business cycle turns down.
So far, the Forbes Beltway Index hasn't disappointed us. On a 52-week basis, through Monday's market close, the index has gained 14%, three points ahead of the Standard & Poor's 500.
We're not claiming here that an investor hitching a ride on the Beltway Index would have necessarily enjoyed that 14% increase. Unlike the Dow Jones industrials or the S&P 500, there are no mutual or exchange-traded funds tracking it. Trading expenses would have taken a bite out of performance.
Note also that in the course of the year, we made a few changes to the Beltway Index roster to keep it up to date with the latest federal contracting information and movement among the defense companies appearing on our own Forbes lists.
Still, here's a look back at the first year's winners and losers. In the former category, a notable is Horizon Lines, the Charlotte, N.C.-headquartered shipping concern. As the company acknowledges in its filings, a key to Horizon's business is the Jones Act. That protectionist federal law requires that vessels transporting cargo between certain ports be built in the United States, be manned by predominately U.S. crews and be owned by U.S. businesses.
Full story at Forbes.com
One rationale for the index is that a solid business rapport with Uncle Sam is a positive indicator for investors. Federal statutes, for example, occasionally shield companies from competition. And big contractors can depend on a steady flow of government dollars when the private-sector business cycle turns down.
So far, the Forbes Beltway Index hasn't disappointed us. On a 52-week basis, through Monday's market close, the index has gained 14%, three points ahead of the Standard & Poor's 500.
We're not claiming here that an investor hitching a ride on the Beltway Index would have necessarily enjoyed that 14% increase. Unlike the Dow Jones industrials or the S&P 500, there are no mutual or exchange-traded funds tracking it. Trading expenses would have taken a bite out of performance.
Note also that in the course of the year, we made a few changes to the Beltway Index roster to keep it up to date with the latest federal contracting information and movement among the defense companies appearing on our own Forbes lists.
Still, here's a look back at the first year's winners and losers. In the former category, a notable is Horizon Lines, the Charlotte, N.C.-headquartered shipping concern. As the company acknowledges in its filings, a key to Horizon's business is the Jones Act. That protectionist federal law requires that vessels transporting cargo between certain ports be built in the United States, be manned by predominately U.S. crews and be owned by U.S. businesses.
Full story at Forbes.com
Wednesday, April 04, 2007
A Gold Star for this Growth Stock
These are heady days for Blackboard, the developer of educational software. Earlier this year, the company posted $183 million in 2006 sales, a 35% year-over-year jump. Several hundred of its 800 employees will soon move to a roomier headquarters, a downtown Washington, D.C. building being vacated by the Department of Justice.
Chief executive Michael Chasen, who at age 25 left law school to found the company in 1997, says he’s still keeping entrepreneurs’ hours.
“You’d think that with 800 people, there’d be less for me to do,” he quips. “I was up until two o’clock last night.”
Wall Street has shared in the excitement. Blackboard's stock, up 11% year-to-date, has more than doubled since debuting in 2004. It now goes for a frothy 86 times its consensus earnings forecast for 2007.
If you’re a growth-oriented investor, there’s an argument to jump on the bandwagon. On average, analysts expect Blackboard to increase earnings at a 25% annualized rate over the next three to five years. And while the stock is richly valued, some measures don’t look outrageous. Its price-to-sales multiple of 5.0, for example, stands under an industry aggregate of 5.3 for U.S. software stocks. Salesforce.com goes for 10 times its revenues. Google’s sales multiple? 14.
Full story at Forbes.com
Chief executive Michael Chasen, who at age 25 left law school to found the company in 1997, says he’s still keeping entrepreneurs’ hours.
“You’d think that with 800 people, there’d be less for me to do,” he quips. “I was up until two o’clock last night.”
Wall Street has shared in the excitement. Blackboard's stock, up 11% year-to-date, has more than doubled since debuting in 2004. It now goes for a frothy 86 times its consensus earnings forecast for 2007.
If you’re a growth-oriented investor, there’s an argument to jump on the bandwagon. On average, analysts expect Blackboard to increase earnings at a 25% annualized rate over the next three to five years. And while the stock is richly valued, some measures don’t look outrageous. Its price-to-sales multiple of 5.0, for example, stands under an industry aggregate of 5.3 for U.S. software stocks. Salesforce.com goes for 10 times its revenues. Google’s sales multiple? 14.
Full story at Forbes.com
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