Sharon Townsend points to her own use of “daily deal” websites to question just how beneficial their proliferation is to Vancouver retailers.

The South Granville Business Improvement Association executive director bought a 50%-off meal coupon to her favourite Vancouver restaurant a few weeks back from one of the city’s nearly dozen daily deal sites.

Each site follows a similar model: it sends its subscriber base a daily deal, which usually includes discounts on goods or services that range between 30% and 90% at a particular store.

A critical mass of consumers taking up the offer is usually required for the offer to be completed.

Like all businesses that sign up to deliver offers on such sites, Townsend’s favourite restaurant hopes its discount offer will draw a flood of new clientele.

“At 50% off, they’re not making any money,” said Townsend, “so they’re counting like blazes that somebody is going to come back a second time and cover off that loss.”

But because Townsend’s a regular patron at her favourite restaurant, she’ll continue to patronize it with or without the discount.

Next time she dines there, however, the restaurant will foot half of Townsend’s bill.

“Are they going to make any money with me coming in there like that? No,” said Townsend.

There’s no question that consumers and businesses have taken to daily deal sites like Indulge Living, Steal The Deal and Grooster, which emerged in Vancouver less than a year ago.

Fuel cells and rechargeable batteries are getting bigger as heavy industry discovers their potential for storing and supplying power for everything from tugboats and buses to power plants.

Richmond’s Corvus Energy is commercializing what it says is the first lithium-ion battery that’s scalable to unlimited megawatt sizes.

The two-year-old firm has engineered plans for lithium-ion battery systems that store up to 42 MW – enough to power thousands of homes.

Corvus’ first big validation is a recent $3 million order from a Chinese coal-fired power plant for a 2.2 MW battery pack the size of a shipping container that will be used for backup power at the plant.

But Corvus’ batteries are also being put to work on the waterfront.

One of its battery packs is powering a 27-foot tugboat in Vancouver, and the company is building battery packs for two diesel-hybrid engines that will power a 45-foot pleasure yacht and a 110-foot tugboat.

Corvus’ founders include a naval architect and a marine systems engineer. Before founding Corvus, both had repeated requests from clients for battery systems that could complement diesel power on boats.

“We spent quite a bit of time looking into what was available in the marketplace and found that there [weren’t] really any batteries that were suitable,” said Corvus co-founder and CEO Brent Perry.

Just as density is key to squeezing more energy into the lithium-ion batteries that power cellphones, it’s key in larger industrial applications.

One of Corvus’ 6.2 KWh battery modules is the same size as a conventional 8D lead acid battery, but Corvus’ batteries can store eight times as much power.

The nickel manganese cobalt in Corvus’ batteries also provides more energy density than the iron phosphate that is used in many lithium-ion batteries.

At $9,300, Corvus’ battery costs roughly $2,000 more than a similar-sized iron phosphate battery, but Perry said the nickel manganese cobalt holds up better in tough environments and provides more power.

As well, customers reduce costs and emissions in the long run.

For example, a typical 2,000 horsepower tugboat uses around 163,000 litres of diesel annually.

By complementing that power with Corvus’ one-megawatt system, a tugboat operator can reduce his fuel bill by 109,000 litres for yearly savings of $325,000.

Radiant heat: David Buffett is as much at home leading a smaller broadband player like Radiant as he was leading Nortel Networks’ European invasion.

Mission: Capitalize on Radiant’s momentum after being first to market with a suite of new broadband products

Assets: 25 years of climbing the ranks at Nortel Networks

Yield: A drastic restructuring that eliminated Radiant’s heavy debt and has it straddling profitability

David Buffett knows a sinking ship when he sees one.

He did, after all, spend 25 years climbing the ranks at Nortel Networks before leaving the company in 2005 – after Nortel’s accounting scandal in 2001, but before the company filed for creditor protection in 2009.

When Buffett became president and CEO of Radiant Communications Corp. (TSX-V:RCN) in May 2006, the Vancouver-based broadband reseller’s ship was not sinking in the same way as was Nortel’s, but it was in need of righting.

Radiant, which was founded in 1996, had begun a restructuring in 2005.

It had crushing debt, a widening loss that grew to $5.2 million in 2005 and less than $2 million in the bank.

In Buffett’s first year leading the company, Radiant decreased operating expenses by 13%, reduced its operating loss to $192,000 from $2.3 million and posted a small profit.

Radiant has continued to improve its operational margins and, while it isn’t as large a ship as Nortel, its righting is impressive nonetheless.

“I treat it as if it’s my own company and my own money,” said Buffett from his office, sounding very unlike some of Nortel’s former executives.

He was hired by Nortel in 1980 only days after graduating with a science degree from the University of Waterloo.

“I wrote my final exams on the Wednesday; on the next Monday I showed up for work,” he recalled.

Over more than two decades, Buffett took on increasing responsibility at Nortel, rising eventually to the role of president of the firm’s wireline networks for Europe, the Middle East and Africa.

There was a time at Nortel when executives like Buffett could not hire fast enough.

“People were yelling and screaming at you to just hire, hire, hire,” said Buffett.

It turns out those people were wrong. While Buffett at one time loved the culture and the people at Nortel, he was not fond of being among those charged with laying off employees en masse.

Radiant has grown from 88 employees when Buffett joined the company to 106 today. Buffett calls it sustainable growth.

A Vancouver-based startup claims it has developed a breakthrough technology for debugging chips in the semiconductor industry.

Veridae Systems Inc., which includes former members of technology heavyweights PMC-Sierra Inc. (Nasdaq:PMCS) and Teradici Corp., also has some lessons about the importance of adapting to the new realities of the venture capital environment with a lean commercialization strategy.

The company operates in a very high-tech space, but is run more like a lean Internet startup than a typical multimillion-dollar research-and-development-driven technology operation.

Set to launch its first products, Veridae has managed to stretch $150,000 in seed funding over two years from early stage R&D to commercialization.

The company’s low-cost, bare bones development cycle is a direct reaction to the venture capital (VC) environment, which Veridae’s CEO Jim Derbyshire is familiar with. His last major private-sector role was helping Ottawa-based semiconductor-maker SiGe Semiconductor Inc. raise nearly $100 million in venture capital. But that was a couple of years ago – in a very different financing environment.

“Go back 10 years in this sort of business and you’d have started looking for a big angel round and then out to the venture capitalists,” said Derbyshire. “And you’d have raised probably $10 million or $20 million for this company. The VCs have gone and the angels, in general, are not willing to invest in this space.”

Every week Techvibes republishes an article from Business in Vancouver. This article was originally published in issue #1093 - October 5 - 11, 2010.

Faronics Corp. looks nothing like it did in 2001.

In that year, the Vancouver company, which was founded in 1996, switched from being a maker of hardware to being a developer and vendor of software. During the transition, Faronics, which recorded $4 million in revenue in 2001, retained and retrained every one of its 22 employees.

Nearly a decade later, and following a major merger in 2003, the company is reporting $18 million in annual revenue on sales of a suite of software products used largely in schools to manage, secure and monitor networks of computers and workstations.

Faronics ranks 17th on Business in Vancouver’s list of biggest software companies in B.C. this year.

BIV caught up with Vik Khanna, the company’s senior vice-president and COO, as Faronics looks to package its workstation management software suite for the corporate sector – a market the company will be tackling in the next 18 to 24 months.

How has Faronics evolved from when it was founded in 1996?

We started off basically as a white-box computer manufacturer and an importer of notebooks from Taiwan. We were wholesaling computers, modems, peripherals and other computer parts to businesses, consumers and school districts. One of the local businesses that we sold to was a software company. They came to us in August 1999 and said, ‘Here’s a software product – show it to some of your school district clients.’ Within an hour, we said forget about showing it and helping you out – give us the rights to sell it. They gave us the rights for Canada. And we did very, very well in sales and then got the rights to sell in the U.S. Then we merged the two companies into Faronics in May 2003. Along the way in November 2001, we cold-turkey quit hardware and became solely a software company.

The challenge in that transition was that we had to retrain every person. Our employees shined through it, and they grew with the company.

Why did you stop selling hardware?

The decision there was margins and profitability. We saw that the 7% profit hardware business that we were putting so much effort into was not anywhere as lucrative as the software business – which is the closest kind of business you can get to printing money, because when you print a software licence, it’s akin to printing money.

What’s your market penetration like today?

We position ourselves very close to security, but we call it system control. What you get through system control is awesome defacto security. We today own the public access market – which is anywhere where there is a computer used by multiple people. The biggest markets [are] schools, universities, libraries and colleges.

In Canada, over 75% of the education sector is a customer in some capacity, and in the U.S. we’re approaching 50% of the education sector. We’ve also diversified into power management, where we are the No. 3 player in the education sector. We have well over half a million licences deployed for our power-saving technology. The competition in terms of our patented deep-freeze technology [which protects workstation configurations from accidental or malicious damage] is fairly non-existent. We are by far the dominant player.

How was Faronics affected by the recession?

We were selling more product during the downturn, but our revenue remained flat. That was primarily due to the appreciation of the Canadian dollar. Our market is a little resilient in that it’s so heavily focused on public institutions, which did not feel the downturn as heavily as corporations did.

What’s next?

This July, we launched our own anti-virus product. We have a road map to combine this anti-virus product with our anti-executable product [which protects workstations from unwanted software by preventing unauthorized executables from running or installing] and our deep-freeze product. We call that the Faronics layered security approach. For us to grow Faronics, we need to really keep what we have going – the great stories, testimonials, great revenue – in our core education market, but also create the need in the corporate small- and medium-sized business market for this solution.

Every week Techvibes republishes an article (or two) from Business in Vancouver. This article was originally published in issue #1089 - September 7 - 13, 2010.

They’re contracts that can provide a zero-maintenance revenue stream for building owners, but there’s more to leasing rooftop real estate for cellphone towers than meets the eye.

This according to a consulting firm that recently opened in Vancouver to help building owners negotiate fair lease values for their rooftop cell-tower space and to help them understand the liabilities they can incur from such leases.

Roy Bennett, founder of Antenna Management Corp. (AMC), has been on both sides of the cell-tower site acquisition process. He has helped building owners negotiate leases with carriers for their rooftop space, and he has scouted potential cell-tower sites for a large Canadian carrier – although he declined to disclose which one, citing a non-disclosure agreement.

“One of the things that always bothered me was that there’s really nobody out there representing the building owners,” said Bennett.

That under-representation and owners’ lack of knowledge about how rooftop cell-tower leases are structured, he said, often result in contracts that favour the carrier.

Factoring in the amount of wireless data that’s transmitted by a cellphone tower, Bennett said carriers annually generate tens of millions of dollars in revenue from each tower.

He added that the average condominium tower can generate $30,000 a year from rooftop cell-tower lease.

But Bennett noted that that price is still a fraction of the revenue generated by the carriers and doesn’t account for building owners’ lease liabilities.