Missouri’s Top Technology Stories Of 2013

2013 In Review- Technology

Before closing the book on 2013, Missouri Business Alert is taking a look back at the year’s most important stories in Missouri business, focusing on the top 10 stories overall and the top five in several key industries:

Missouri’s tech sector in 2013 saw a multibillion-dollar merger involving an established giant, a multimillion-dollar buyout of an up-and-coming company, and a variety of developments that helped spur tech startups in St. Louis and Kansas City.

Sprint Corp. made as many headlines as any area tech company. The Overland Park, Kan.-based wireless provider’s long merger process with Japanese telecom company SoftBank came to a close, and Sprint made several moves to expand its influence in the region’s startup scene. On the other side of the state, Jim McKelvey, a St. Louisian and the co-founder of mobile payments company Square, spearheaded several efforts to help his hometown’s tech companies and increase the pool of programming talent in the area.

The year also saw the expansion and application of super-fast internet service Google Fiber in the Kansas City area, even as Fiber moved into other markets. And as the year drew to a close, Columbia-based mobile video news company Newsy became a wholly-owned subsidiary of news conglomerate E.W. Scripps Co. in a $35 million acquisition.

1. Meet Sprint, the subsidiary

A Sprint store in Springfield | Photo by Nicole Lunger
Sprint was purchased by SoftBank, then bought out the half of Clearwire it didn't already own. | Photo by Nicole Lunger

After months of negotiating, raising the stakes and fending off a late charge from Dish Corp., Toyko-based SoftBank purchased 78 percent of Sprint, the nation’s third-largest wireless carrier. The July deal left Sprint CEO Dan Hesse and three of the company’s existing directors in charge of the company, but Hesse now reports to SoftBank CEO Masayoshi Son, now chairman of Sprint’s board.

SoftBank plans to invest $16 billion in Sprint over the next two years, supporting construction of faster LTE network services to increase revenue and competitiveness with larger carriers AT&T and Verizon Wireless. Sprint also dropped Nextel from its name and closed on its $3.8 billion acquisition of the half of Clearwire Corp. it did not already own. By year’s end, speculation was growing that Son was exploring a deal for Sprint to buy a majority share of T-Mobile US Inc., the country’s fourth-largest wireless carrier.

2. McKelvey invests in St. Louis tech

In a move aimed at increasing the tech talent pool in St. Louis, Jim McKelvey started LaunchCode, an apprenticeship program that pairs local coders with employees at 100 area companies, ranging from Express Scripts and Monsanto to a two-man startup. The process, known as pair programming, aims to help coders learn skills faster and wind up with high-paying jobs.

Beyond that, McKelvey will serve as managing director of SixThirty, an accelerator for financial tech startups that was announced in August. And Cultivation Capital, a St. Louis venture capital firm where McKelvey’s a general partner, opened a $30 million fund in June.

3. Sprint engages local startup scene

McKelvey is not only a co-founder of Square, a mobile payments company, but sits on the boards of major St. Louis startups such as Lockerdome and organizations such as Cultivation Capital | Photo by Austin Huguelet
Jim McKelvey helped spur an eventful year for St. Louis startups. | Photo by Austin Huguelet

Sprint’s biggest story was its own acquisition, but 2013 also saw the wireless carrier make big strides in its relationship with Kansas City’s burgeoning startup scene. In May, Sprint acquired Kansas City-based app developer Handmark and spinoff OneLouder Apps, hoping to draw on Handmark’s innovation to help with Sprint’s mobile advertising.

In the next two months, Sprint announced a partnership with entrepreneurial grooming program Pipeline and struck a distribution deal with Kansas City, Kan.-based LocalRuckus. In September, Sprint announced  a partnership with Boulder, Colo.-based accelerator TechStars in creating the Sprint Mobile Health Accelerator, a program for startups working with mobile technology to improve health care. The accelerator’s first class will begin the intensive program in March.

4. Google Fiber takes root in Kansas City

As Google Fiber announced its second and third cities — Austin, Texas, and Provo, Utah — and other cities moved to add speedier broadband services, Kansas Citians began to use the gigabit-speed internet service, which chose Kansas City as its first location in 2011 but didn’t begin rolling out to users until the end of 2012.

On the Missouri side, Lee’s Summit, Gladstone, Grandview and Raytown signed agreements with Google to receive its services. Mission Woods, Olathe, Shawnee, Westwood and Westwood Hills forged deals on the Kansas side.

Fiber has been a driving force in the rise of Kansas City’s startup scene, evident in the formation of Kansas City Startup Village, hackathons and more. Fiber has also been an important promotional tool to attract entrepreneurial and tech talent to Kansas City and its surrounding area.

5. Newsy sells to Scripps, expands reach

Newsy, a Columbia-based provider of digital news video, was acquired by E.W. Scripps Co. for $35 million in December, as part of the Cincinnati-based company’s push to further develop its digital presence.

Founded in 2008, Newsy says it now produces 1,500 videos each month and has partnerships with digital brands like AOL/Huffington Post, Microsoft and Mashable. Newsy will operate as a wholly owned subsidiary of Scripps, and Newsy’s 35 full-time employees and its part-time employees will remain in Columbia.

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