Michael Dell

Photo Credit: Andy Nguyen | Daily Texan Staff

Startups are critical to major, established companies because they embrace risk to support new technologies and ideas, the founder of Dell Inc. said.

Students presented their own startups for products such as life-coaching apps and concussion-detecting mouth guards to investors — including Michael Dell, founder and CEO of Dell Inc. — at Longhorn Startup Program’s “Demo Day” on Thursday.

Dell said his company has grown to be the world’s largest startup since he first began the company at age 19 in his UT dorm room. There are hundreds of businesses within Dell Inc., because the company is willing to innovate and take risks on startups, Dell said.

“Big companies, as they grow — they tend to want to not take risks,” Dell said. “Our industry is changing so rapidly. I think it’s important to be able to go back to that risk-taking and embracing new ideas as a key thing.”

Dell said people in the U.S. are blessed to have a culture that embraces risk and innovation and allows people to try things, even if they aren’t guaranteed to be successful.

Professors Joshua Baer, Bob Metcalfe and Ben Dyer have taught the Longhorn Startup course, a class where students create startups to present at Demo Day, for the last four years. Baer said the class will change in a few ways next semester — such as including open pitches for ideas and “co-founder speed dating” — as he takes over as the course’s main professor.

“The fall seminar, in a lot of ways is going to be similar to what we have now — same great speakers that are coming in inspiring and sharing their stories and teaching students about what they’re working on,” Baer said. “The big difference is there won’t be a Demo Day in the fall, we’ll just do a Demo Day in the spring.”

Biochemistry senior Yousef Okasheh, who presented his startup during Demo Day, said his app “Who’s Hungry” makes it easier for friends to meet up and eat together. Okasheh said he gained inspiration for his app from Yik Yak, an anonymous group app.

“We plan on switching this market by influencing the student leaders on campus,” Okasheh said. “This was a tactic that was used by the app YikYak … and proved to be very successful for them due a very low user-acquisition cost.”

In this podcast, Anthony Green and Madlin Mekelburg discuss the suspension of sophomore basketball guard Martez Walker, the Departmentalization of the Center for Mexican American Studies and "Thread" the new UT centric dating app created by Zach Dell, son of Dell Inc. founder Michael Dell. They are joined by News Editor Jacob Kerr to discuss the ongoing problems the UT System faces with its MOOC initiative. Reporter Natalie Sullivan also joins the gang to discuss this week in crime.

Sebastian Bruce, a computer science and economics senior and founder of StartATX, presents the "Thread" app on his phone.

Photo Credit: Lauren Ussery | Daily Texan Staff

The name Dell may be synonymous with computers, but a younger Dell has his eyes set on online dating. 

Zach Dell, son of Dell Inc. founder Michael Dell, will launch a new dating app called “Thread” to connect college students. The official release party will be Sept. 20 at the Fiji house, with admission granted to anyone who has downloaded the app.

Sebastian Bruce, a computer science and economics senior and founder of StartATX, a UT organization that promotes entrepreneurship, spoke to Dell about creating the app. 

“He raised a little bit over a half a million and with that was able to find really good developers, designers and a new co-founder, who went to Wharton,” Bruce said. 

“You can date within your college or university, so it’s very close knit, rather than Tinder, where you just meet some random person,” Bruce said. “You have to have a ‘.edu’ email in order to join.”

Dell, who is a senior at St. Andrew’s Episcopal School, said he connected with investors in Austin who have contributed more than $600,000 in funding. 

Dell said his first investor was Robbie Yeager, a friend of both Dell and Bruce. Yeager invested $100,000 in the project in 2013, making him the largest contributor.

“At first I wasn’t so sure, but, when I talked to [Dell], I could see how passionate he was about the project,” Yeager said. 

With its launch, Thread will be joining a host of other apps that foster dating and interactions among specified groups of people. Dell said an important difference between Thread and other apps is the exclusivity that requires all users to be college students.

“Thread is 100 percent college exclusive,” Dell said. “You have a filtering mechanism to your college; this increases the safety of using the app.”

In narrowing down the pool of community members who access the app, Dell said he intends to increase the degree of safety for users. 

“With Thread, there are many safety mechanisms — a lot to protect women,” Dell said.

According to Dell, he became interested in contributing to the online dating industry when he realized that use by younger generations was increasing. 

“A lot of people thought people who are younger were interested in online dating, but what I saw was that it turned into a creepy industry,” Dell said. “No company was going out of their way to create a safe environment, especially for women.”

Dell said he could see several opportunities for improving existing online dating options. Currently, the app is available exclusively for use at UT, but Dell said in the future, he intends to expand the service to other colleges and universities.

Photo Credit: Caleb Kuntz | Daily Texan Staff

Zachary Dell, son of Michael Dell, will be joining with StartATX on Tuesday evening for a presentation about student entrepreneurship. 

StartATX is a campus organization founded in the spring as a networking and resources group for students in start-up businesses. 

It was created and is run by Sebastian Bruce, a computer science and business economics senior, with co-president Zachary Cook, a management information systems senior. 

Bruce said he was inspired to create StartATX when he learned about similar organizations at schools such as Harvard University and Penn State. He said there are other groups at UT designed for students beginning to consider small business, but there is nothing like StartATX, 

“We’re hoping to primarily target people who are [already] in start-ups,” Bruce said.

Cook said he felt the
organization was important because student entrepreneurs face challenges specific to running a small business. 

“Starting a business when you’re a full-time student is such a unique experience,” Cook said. “It is a lot of responsibility and risk.” 

Bruce and Cook said students behind start-ups struggle with finding mentors, co-founders and investors. StartATX provides students with the support, advice and a pool of contacts entrepreneurs need. 

“There’s a start-up culture [in Austin] but it’s very young,” Bruce said. 

Bruce said StartATX plans to enrich this culture, and said he hopes to see success stories come from their organization. The co-presidents are being mentored by McCombs’ Entrepreneur-in-Residence Brett Hurt and receive input from Michael Dell.

Last summer Bruce met with Zachary Dell to discuss the development of Dell’s new business. Dell, a junior in high school, is already working on his second company. Dell’s latest project is a new mobile app called “Interested,” which will be released in 3 to 4 weeks. 

His first business was a sports camp he founded with his cousins. According to Dell, entrepreneurship is like a baseball game.

“You swing until you hit it with a new company … maybe we’ll hit a homerun, maybe we’ll strike out,” Dell said. “But it won’t be the last time I step up to the plate.” 

He said his father’s guidance has been helpful in establishing these start-ups, but he chooses to learn through his own experiences, 

“My dad has been an incredible influence — he never forced anything on me, but he was always there to say, ‘Read this book’ or, ‘Contact this guy’ when I had new ideas,” Dell said. “I’ve learned things I wouldn’t have if I’d gone straight to my dad.”

Dell said he plans to bring those experiences and his passion for small business together in his speech on Tuesday.

More information can be found at StartATX.org.

Slumping personal computer maker Dell is bowing out of the stock market in a $24.4 billion buyout that represents the largest deal of its kind since the Great Recession dried up the financing for such risky maneuvers.

The complex agreement announced Tuesday will allow Dell Inc.'s management, including founder Michael Dell, to attempt a company turnaround away from the glare and financial pressures of Wall Street.

Dell stockholders will be paid $13.65 per share to leave the company on its own. That's 25 percent more than the $10.88 the stock was going for before word of the buyout talks trickled out last month. But it's a steep markdown from the shares' price of $26 less than five years ago, when the company's eponymous founder Michael Dell returned for a second go-round as CEO.

Dell shares rose 11 cents to $13.38 per share in morning trading, indicating that investors don't believe a better offer is likely.

Dell's decision to go private is a reflection of the tough times facing the personal computer industry as more technology spending flows toward smartphones and tablet computers. PC sales fell 3.5 percent last year, according to the research group Gartner Inc., the first annual decline in more than a decade. What's more, tablet computers are expected to outsell laptops this year.

The shift has weakened long-time stalwarts such as Dell, fellow PC maker Hewlett-Packard Co., chip maker Intel Corp. and software maker Microsoft Corp.

Once Dell's sale is finalized, its stock will stop trading on the Nasdaq Stock Market nearly 25 years after the Round Rock, Texas, company raised $30 million in an initial public offering of stock. Microsoft Corp. is helping the deal along by lending $2 billion to the buyers, which include investment firm Silver Lake.

The company will solicit competing offers for 45 days.

The IPO and Dell's rapid growth through the 1990s turned its founder into one of the world's richest people. His fortune is currently estimated at about $16 billion. Michael Dell, who owns nearly 16 percent stake in the company, will remain the CEO after the sale closes and will contribute his existing stake in Dell to the new company.

Dell's sale is the second highest-priced leveraged buyout of a technology company, trailing the $27 billion paid for First Data Corp. in 2007.

The deal is the largest leveraged buyout of any type since November 2007 when Alltel Corp. sold for $25 billion to TPG Capital and a Goldman Sachs subsidiary. Within a few months, the U.S. economy had collapsed into the worst recession since World War II.

Leveraged buyouts refer to deals that saddle the acquired company with the debt taken on to finance the purchase.

Like other PC makers, Dell has seen revenue shriveling and its stock sinking amid worries that the company might not be able to regain its technological edge.

Both Dell and its larger rival HP are trying to revive their fortunes by expanding into business software and technology consulting, two niches that are more profitable than making PCs.

The PC downturn has hurt Microsoft by reducing sales of its Windows operating system. As the world's third largest PC maker, Dell is one of Microsoft's biggest customers.

By becoming a major Dell backer, Microsoft could gain more influence in the design of the devices running on a radically redesigned version of Windows that was released in late October. The closer ties with Dell, though, could poison Microsoft's relationship with HP, the largest PC maker, and other manufacturers that buy Windows and other software.

In a statement, Michael Dell said that while the company has made progress, turning it around will be easier under private ownership.

"We recognize that it will still take more time, investment and patience, and I believe our efforts will be better supported by partnering with Silver Lake in our shared vision," he said.

As a private company, Dell won't have to pander to the stock market's fixation on whether the company's earnings are growing from one quarter to the next.

Taking the company private is a major risk, however. It will leave Dell without publicly traded shares to entice and reward talented workers or to help buy other companies.

As part of its shift toward business software and technology services, Dell already has spent $9 billion on acquisitions in the past three years.

Leveraged buyouts also require companies to earmark some of their incoming cash to reduce the debt taken on as part of the process of going private. The obligations mean Dell will have less money to invest in innovation and expansion of its business.

The buyout will mark a new era in another technology company that began humbly and matured into a juggernaut.

With just $1,000, Michael Dell, then a freshman at the University of Texas at Austin, started his company as "PCs Limited" in his dorm room. He would go on to revolutionize the PC industry by taking orders for custom-made machines at a reasonable price — first on the phone, then on the Internet.

Initially valued at $85 million in its 1988, Dell went on a growth tear that turned the company into a stock market star. At the height of the dot-com boom in 2000, Dell was the world's largest PC maker, with a market value of more than $100 billion.

But Dell began to falter as other PC makers were able to lower their costs. At the same time, HP and other rivals forged relationships with stores that gave them the advantage of being able to showcase their machines. By 2006, HP had supplanted Dell as the world's largest PC maker.

With its revenue slipping, Dell's market value had fallen to $19 billion before the mid-January leaks about the buyout negotiations.

Susan Dell announces that the Michael & Susan Dell Foundation will be donating $50 million to The Dell School of Medicine at the foundation’s headquarters in January.

Photo Credit: Chelsea Purgahn | Daily Texan Staff

UT will name its new medical school in honor of the Michael & Susan Dell Foundation after a $50 million donation that was announced Wednesday. 

The donation will be distributed over 10 years to the new Dell School of Medicine, which is scheduled to begin enrolling student by the fall of 2016.

The Dell family foundation will also commit $10 million toward community grants to improve the quality and access of health clinics in Austin.

“The effects of a medical school will be felt well beyond the UT campus,” Michael Dell said. “It will bring more medical expertise, specialists and researchers to the area. It will benefit for synergies between nursing, mental health, pharmacy and applied health education, and attract both private and public research funding. Ultimately, it will elevate the level of health care for the entire community.”

In November, Travis County voters approved to increase property taxes, from 7.89 cents to 12.9 cents per $100 of property value, collected by Central Health Travis County’s hospital district to help fund the medical school. 

The Dell family foundation, founded in 1999, has contributed more than $90 million to the University in funding and various health care initiatives, including the Dell Children’s Medical Center, the Dell Pediatric Research Institute, the Michael & Susan Dell Center for Healthy Living and the Texas Center for the Prevention and Treatment of Childhood Obesity.

Dr. Aliya Hussaini, the foundation’s health team leader, said the donation will be used for education, through recruiting faculty and investing in technology and equipment.

“We’ve had some really great opportunities to partner with UT because they do some much for the community,” Hussaini said. “We know medical students tend to stay were they go to school and even more where they train. It would be great if the best and brightest medical students were here in Austin taking care of our families and our community.”

President William Powers Jr. said the previous donations from the Dell family foundation helped make the medical school possible, building the University’s health care credibility.

“It will be better for health care in Texas, it will allow people to have more specialties,” Powers said. “It will help attract faculty and students who might want to work in a health sciences area that might go somewhere else, if there wasn’t a medical school.”

Steven Leslie, executive vice president and provost, said the medical school’s steering committee is structuring the school, including its curriculum and training programs, and plans to have its inaugural dean by the fall. The steering committee is co-chaired by Dr. Robert Messing, the University’s newly appointed vice provost for biomedical sciences, and Dr. Susan Cox, regional dean for Austin programs
at UT-Southwestern.

Printed on Thursday, January 31, 2013 as: Dell family donates $50 million to medical school 

We live in Austin. Michael Dell went to school here. Both Facebook and Google have offices here. So then why is it that, in an era of obscene technological innovation, the interfaces we use to connect with our University look like they were designed in 1995?

Registration for the summer and fall semesters will begin this week and so will student frustration with UT Direct. It’s a system so shockingly bad that the only hope I have of properly navigating it is through its search function. It does, however, provide a handy “Pic o’ the Click” near the very top of the page that generates random photos of the University. That way, when I can’t figure out how to register for classes next semester, I’ll at least be able to look at pictures of the college I won’t be attending.

UT Direct is, of course, not the only antiquated system students are forced to use. Blackboard, which I’ve written about in the past for its ability to allow our classmates to spam us, is dreadful. Meanwhile, UT Webmail was finally and mercifully disposed of last week, when ITS announced new UT Mail powered by Google.

The tech problem this University faces is not unique. According to The Campus Computing Project, 57 percent of all colleges and 68 percent of public universities use Blackboard as their learning management system (LMS). It’s a statistic that’s down from previous years despite every attempt of the industry leader to stop it.

Blackboard is the Microsoft of the LMS world, and I don’t mean that in a good way. Since its inception, Blackboard has either outfought or bought its competitors. Most notable is Angel Learning, which was bought by Blackboard in 2009 after achieving 7 percent market share. And when that hasn’t worked, Blackboard has sued its rivals to retain a patent over use of its closed source software. Unfortunately for Blackboard, Desire2Learn, which has a 10 percent market share, won that legal battle this past November.

Most Blackboard competitors are championing open-source systems, meaning the source code is freely available for developers to innovate. One of those is Instructure, a Utah-based startup that announced Friday that it’s raised $8 million to fund its LMS called Canvas. One of those investors just happens to be Google chairman Eric Schmidt.

According to The Wall Street Journal, Canvas, unlike Blackboard, has the functionality to connect with other online services such as Google Docs, Facebook and Twitter. “When a teacher changes the date of a quiz, for example, students could automatically receive text messages to their cellphones, a message on Facebook or conventional email,” according to The Wall Street Journal.

It’s a revolutionary change that’s long overdue. Instructure even released a highly entertaining video on YouTube called “Change is Good,” which parodies Apple’s famous 1984 ad. But instead of Big Brother, it’s a blackboard that addresses rows of brainwashed students. It’s funny because it’s true.

Beyond Instructure, entrepreneurial students at universities across the country are creating their own alternatives. At Stanford, there’s ClassOwl. At Penn, they have Coursekit. And at MIT there’s iMobileU.

Then there’s Austin Peay State University in Tennessee, which has developed new course-picking software. The Chronicle of Higher Education has called it the “Netflix Effect”; the software analyzes a student’s major, previous academic performance and data on similar students to provide a recommendation in the way Netflix suggests movies you might like based on previous rentals. It even predicts what grade you’ll get. So far, the software has resulted in a half-point GPA increase for students who chose courses suggested by the program.

So why can’t Texas be next? Fortunately, ITS is trying to help. Beginning Wednesday and continuing into next week, Texas has opened up demonstrations from five LMS vendors to faculty, staff and students. All the big dogs will be there, including Instructure, Desire2Learn, Moodle, rSmart and, of course, Blackboard. They’ve also made surveys available online through which you can and should trash Blackboard.

The University is finally seeking our input on this, so make sure your voice is heard. Otherwise, don’t be surprised when you’re asked to dig up your old AIM screen name to login to a course chat room.

<em>Curl is an advertising graduate student.<em>We live in Austin. Michael Dell went to school here. Both Facebook and Google have offices here. So then why is it that, in an era of obscene technological innovation, the interfaces we use to connect with our University look like they were designed in 1995?

Registration for the summer and fall semesters will begin this week and so will student frustration with UT Direct. It’s a system so shockingly bad that the only hope I have of properly navigating it is through its search function. It does, however, provide a handy “Pic o’ the Click” near the very top of the page that generates random photos of the University. That way, when I can’t figure out how to register for classes next semester, I’ll at least be able to look at pictures of the college I won’t be attending.

UT Direct is, of course, not the only antiquated system students are forced to use. Blackboard, which I’ve written about in the past for its ability to allow our classmates to spam us, is dreadful. Meanwhile, UT Webmail was finally and mercifully disposed of last week, when ITS announced new UT Mail powered by Google.

The tech problem this University faces is not unique. According to The Campus Computing Project, 57 percent of all colleges and 68 percent of public universities use Blackboard as their learning management system (LMS). It’s a statistic that’s down from previous years despite every attempt of the industry leader to stop it.

Blackboard is the Microsoft of the LMS world, and I don’t mean that in a good way. Since its inception, Blackboard has either outfought or bought its competitors. Most notable is Angel Learning, which was bought by Blackboard in 2009 after achieving 7 percent market share. And when that hasn’t worked, Blackboard has sued its rivals to retain a patent over use of its closed source software. Unfortunately for Blackboard, Desire2Learn, which has a 10 percent market share, won that legal battle this past November.

Most Blackboard competitors are championing open-source systems, meaning the source code is freely available for developers to innovate. One of those is Instructure, a Utah-based startup that announced Friday that it’s raised $8 million to fund its LMS called Canvas. One of those investors just happens to be Google chairman Eric Schmidt.

According to The Wall Street Journal, Canvas, unlike Blackboard, has the functionality to connect with other online services such as Google Docs, Facebook and Twitter. “When a teacher changes the date of a quiz, for example, students could automatically receive text messages to their cellphones, a message on Facebook or conventional email,” according to The Wall Street Journal.

It’s a revolutionary change that’s long overdue. Instructure even released a highly entertaining video on YouTube called “Change is Good,” which parodies Apple’s famous 1984 ad. But instead of Big Brother, it’s a blackboard that addresses rows of brainwashed students. It’s funny because it’s true.

Beyond Instructure, entrepreneurial students at universities across the country are creating their own alternatives. At Stanford, there’s ClassOwl. At Penn, they have Coursekit. And at MIT there’s iMobileU.

Then there’s Austin Peay State University in Tennessee, which has developed new course-picking software. The Chronicle of Higher Education has called it the “Netflix Effect”; the software analyzes a student’s major, previous academic performance and data on similar students to provide a recommendation in the way Netflix suggests movies you might like based on previous rentals. It even predicts what grade you’ll get. So far, the software has resulted in a half-point GPA increase for students who chose courses suggested by the program.

So why can’t Texas be next? Fortunately, ITS is trying to help. Beginning Wednesday and continuing into next week, Texas has opened up demonstrations from five LMS vendors to faculty, staff and students. All the big dogs will be there, including Instructure, Desire2Learn, Moodle, rSmart and, of course, Blackboard. They’ve also made surveys available online through which you can and should trash Blackboard.

The University is finally seeking our input on this, so make sure your voice is heard. Otherwise, don’t be surprised when you’re asked to dig up your old AIM screen name to login to a course chat room.