IBM Finds Its iOS, Android Startup Star

NEW YORK ( TheStreet) -- Shortly after 8 p.m. Wednesday night, IBM ( IBM) announced that Localytics, a three-year old tech firm from Cambridge, Mass., won the twelfth SmartCamp competition, a jousting ground for five start-ups all peddling some type of data analytics software.

While the crowd wasn't as alternative or cool as the ones present at, say, New York City's TechCrunch Disrupt or South by Southwest in Austin, Texas -- think clean-cut entrepreneurs in crisp business casual pitching technology that caters to municipalities and large corporations -- the underlying goal of the event was the same: Highlight hot, mobile applications.

Granted, no new social networks or group-texting apps surfaced. Instead, venture capitalists and IBMers heard about technologies that would wirelessly network nature to city offices, help homeowners use their iPhones to make efficient home-heating decisions and enable corporations to better retain their brand image across multiple social networks.

"It's all about finding ways with iPhones and other mobile devices to do things that are very useful," said Patrick Leslie, founder and CEO of Envirolytics, a four-month-old Canadian firm -- and SmartCamp contender -- whose app enlightens iPhone users to smarter home energy solutions.

Seen another way, Wednesday night was about IBM helping to locate lucrative ways to harness very specific data via mobile devices, an initiative that underscores what Big Blue pushes as its higher calling as one of the world's largest tech titans: Find and support products that help solve huge, global problems.

"We love complex issues," said Jim Corgel, general manager of developer relations for IBM's software group. After noting that in 2050, city dwellers will make up 70% of the world's population, he ticked off things like better water and traffic management systems. "But there's a lot of creating that needs to go on before those issues are solved."

To that end, IBM is now in its second year of sponsoring SmartCamp, essentially a global business plan competition where, instead of money, winning start-ups receive press, mentoring from venture capitalists and other business veterans, and, in some cases, working partnerships with Big Blue itself.

"We don't have a lock on all the world's creative minds," Corgel said, gesturing toward the board room at New York City's SUNY's Levin Institute, where the chosen entrepreneurs would shortly start their final, six-minute presentations. "But we'd like them to meet ours."

In fact, the night's winner -- Localytics, which counts a handful of well-known media names like Dow Jones and The New York Times as customers -- is already working with IBM's Web marketing division, Unica, to broaden its analytical ability for mobile device platforms.

Ironically, Localytics, which provides smartphone and tablet app developers with insight into how well their programs are reaching customers, was the most consumery, "appy" technology of the night -- not exactly a play toward the big-data, "smarter cities," "smarter planet" mantra that's helping to remake IBM in investors' eyes.

"The feedback we received is that ... mobile phones are making people around the world more interconnected than ever before," said Brian Suthoff, VP of market development at Localytics. " Our service is a nice tie-in to help people build apps for that worldwide market, whether it's reading newspapers or finding a cheap place to buy a product."

While Localytics might not be the poster child for IBM's bigger picture, it does exemplify what Corgel calls "a form of corporate citizenry to find a way to identify, nurture and develop" exciting, global businesses.

Plus, it puts Big Blue just that much closer to tech's most buzzy, consumer-favorite space: Smartphone and tablet apps.

The next step for Localytics, which recently closed a $1.8 million round of angel funding, will be to compete in IBM's SmartCamp World Finals, which pits all of this year's regional SmartCamp winners against each other to vie for IBM's "Global Entrepreneur of the Year" title. The winner will likely receive funding, six months of Manhattan office space and more mentoring.

--Written by Maggie Overfelt in New York.

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