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AOL acquires mobile app Rally Up and the Santa Cruz team that dreamed it up

Santa Cruz Sentinel

SANTA CRUZ – When a group of young Santa Cruz techies piled into a rented WI-FI-enabled RV with their laptops for an impromptu week-long programming retreat last November, they couldn’t have imagined that one of the largest and, well, not very geeky, Internet services and media companies in the country would soon come knocking with a multi-million dollar offer.

This week, AOL announced it hired the entire Rally Up team to ignite its nascent Mobile First initiative in the Consumer Applications and Mobile division. The company also acquired the group’s latest two applications, Rally Up, a location-based social network application that links “real” friends; and FacePlant, a not-yet-released iPhone video chat application that lets users see which of their contacts are on WiFi networks and available for FaceTime calls.

The deal, valued at “less than $10 million,” means that the nine techies, aged 24-40, from four different Santa Cruz companies will start new jobs Tuesday at AOL’s new West Coast mobile application offices in Palo Alto. The team members, whose collaborative creativity blossomed while housed at NextSpace, a coworking environment in downtown Santa Cruz, say they will be doing what they say they do best: working together to build cutting edge mobile applications.

“Ultimately we’re going to continue to operate the way we do now – come up with amazing ideas and execute on those ideas faster than anyone else,” said Sol Lipman, chief executive of Rally Up, which, he says has been a company that works largely by collaboration. His new title is senior director of Mobile AOL. “This team has a certain chemistry I’ve never seen. Every individual contributes something very unique. As long as we get together as a team we’re going to succeed in creating lot of crazy applications for AOL.”

Members of the group – which calls themselves the A-Team after the 1980s TV series featuring a renegade U.S. Special Forces team that constantly blows up things – includes Lipman, cofounder of 12seconds.tv; Jacob Knobel, who worked with Lipman to create 12seconds; Davy Reynolds and Ruby Anaya of Parachute Creative; Andrew Bonggren and Ethan and Stacy Nagel of Nagel Technologies; and Andrew and Jeffrey Lyon of Lyon Bros. Enterprises.

“It’s been an awesome trip,” said Ethan Nagel, who described them as a “ragtag group” that came together with tentative hopes.

It started on a Tuesday in November with Lipman shopping around NextSpace for candidates willing to drop everything and drive down to a camp in Malibu where they could focus on building from scratch some kind of social networking application for close friends.

“We went from ‘Let’s go and build this product’ to ‘Let’s all drive to Southern California and live in a camp in the middle of nowhere and build this,'” Nagel said.

Two days later the group piled into a rented RV with a full shower and a certain amount of beer and headed out of town with their laptops open and blaring music for a week of surfing, coding and kosher food served up by the camp where Lipman used to work as a director and Knobel used to be a camper.

“As we’re driving, we’ve got laptops open and we’re all talking about product ideas,” Nagel said. “It’s probably beyond words to describe it. It was seriously fun and purely entertaining. When we left that week, we had something we could actually use.”

The initial collaboration went so well, that they kept working together on bigger jobs when they got back to their offices in NextSpace. Rally Up gained a following and in the spring, AOL contacted the company about working in its growing mobile technology division.

“We were like, huh? AOL, what are they doing now?” said Knobel. AOL is launching a new initiative to launch some products first on mobile devices. “People tend to look at AOL negatively, especially if you’re a technical person, but they are doing a lot of cool things now and trying to create themselves in a new way. Our team is part of that. It’s a younger style. We get to reinvigorate them. They’ve got a lot of new ideas that haven’t been tried before. We’re a team that likes to go head strong into things. We’re not afraid to try things even if they don’t work.”

The Rally Up team will provide AOL with an additional spark to ignite its mobile-first initiatives, according to AOL. “Within the last year, the Rally Up team has demonstrated its keen understanding of the way that people want to use their mobile devices to interact, share and better communicate and of the tools necessary to address those needs,” said David Temkin, vice president of Mobile at AOL. “We are thrilled to have such a talented group of mobile innovators join AOL, especially given the rapid evolution of this space.”

It is bittersweet, however to leave their home base, said Lipman. “But, we’re going to be a good bridge to that community in Palo Alto. We want to inspire more startups in Santa Cruz.”

The week before the group starts was spent closing out their various companies and, for several, vacationing with family in Hawaii.

“Our biggest issue right now is figuring out whose driving and what cars we’re going to get into,” said Knobel, whose new title is principal software engineer at AOL Mobile.

Peter Koht, economic development coordinator at the City of Santa Cruz, said he was disappointed to see the team leave Santa Cruz, but he was “stoked” they will have more resources to develop their team and new applications.

“AOL made a great acquisition, securing good products and the talent that built them,” He said. “As the Rally Up team become more central to AOL’s mobile strategy, I hope the company realizes that Santa Cruz’s startup ecosystem was an essential element to their success.”

Although some members have been quoted as comparing Lipman to Mr. T with the trademark one hanging earring of the A-Team, Ethan Nagel, says really, Lipman is more like Colonel John “Hannibal” Smith of the TV series. “I can see Sol with a big cigar in his mouth saying ‘I love it when a plan comes together.'”

This article was first published here.

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This entry was posted on September 4, 2010 by in Business, Technology.

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