Dave McClure’s startup program has been rocking along for three years now, and is targeted to hit its namesake investment number some time this year. The group’s investment philosophy is well-documented, and involves making a larger number of bets on a variety of companies, particularly international ones, in hopes of finding some winners. Wednesday’s demo day didn’t rival the zany scope of Y Combinator demo days, but 500 Startups is building a different brand than its older rival. The newest 500 Startups companies have an international bent and clearly focus on practical things like traction and revenue — they all included slides on growth and profits in addition to Top 40 music intros.

30 startups presented at Wednesday’s accelerator demo, with a good number of companies focusing on 500 Startups’ core investment interests (parenting, marketing and analytics, and e-commerce, to name a few). Here were my five favorites from the day:

Waygo

Waygo is a pretty cool-looking app built for international travelers. It allows a user to hover their phone over foreign text and get instant translations, almost like scanning a barcode or QR code. The app works in real time, preventing any kind of delay in translation, and most importantly has offline capabilities so users don’t rack up roaming charges. The company said the average active user in China uses the app to perform translations up to 140 times per week. The company has a tiered pricing model, allowing people who want more translations per week to up their subscriptions.

Babylist

When software developer Natalie Gordon was pregnant, she was dismayed to discover that baby registries, like wedding registries, only allowed a consumer to pick wish lists on individual company sites and didn’t allow new parents to list items that were outside of traditional e-commerce (dog-walking, lasagna-baking, etc.) So while pregnant, she coded the beginnings of Babylist, a company that now allows new parents to create their own baby registries. The site, which works like Pinterest and allows parents to create wish boards (taking 4 percent of transactions on average), has more than 11,000 sign-ups so far, and saw $2.4 million in gifts purchased through the site this past year.

Curious Hat

Curious Hat is one of several companies targeting the market of high-tech parents and kids to build educational content for tablets and iPhones that the two can enjoy. Co-founders CEO Luca Prasso and CTO Erwan Maigret both worked at Dreamworks on films including Shrek and Madagascar. “His generation plays, learns, and creates content in new ways,” Prasso said of his young son’s generation. “We want to further engage curious minds.” The company builds iPhone and iPad apps that allow users to send photos and games to their children, post to Facebook, and choose when and where to engage kids in the app. They have a cool feature called “eye paint” that allows children to take photos of real life things and then “paint” using those captured colors or textures. The Curious Hat founders join other tech people who went from large entertainment companies to kids-oriented startups, like Fingerprint’s Nancy MacIntyre or Toy Talk’s Oren Jacob (see disclosure).

CompStak

CompStak is on online marketplace for commercial real estate, aggregating difficult to find information about real estate prices and availabilities in major cities including New York and San Francisco. “Our data is used by institutional owners to compare properties, hedge funds to make investments, and provides meaningful data for brokers, investors, appraisers, asset managers, economists and more,” as the company explains on its website. The company reports that it has all comps, or records of completed lease transactions, from New York over the past year and 50 percent of comps from the past 10 years. The company has free and premium subscription levels.

SupplyHog

Targeting an unusual market for Silicon Valley startups but one that’s actually quite large, SupplyHog works with contractors to let them purchase building supplies online, price out different options, and have them shipped. “It’s tough to find a technology team that’s passionate about building supplies,” said CEO and co-founder Nathan Derrick (a veteran of the construction industry from Chattanooga), but his company has built an interface that allows contractors to find and purchase supplies, working to create a more reliable supply system.

Disclosure: Toy Talk is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

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The office space search engine on Friday announced an expansion to New York and a $5 million Series A round of funding from 35 big-name investors, including Thrive Capital’s Jared Kushner, Founder Collective’s Chris Dixon, 500 Startups’ Dave McClure and Digital Sky Technologies’ Yuri Milner. The company said the majority of its investors are New York-based because that’s where it plan to focus.

42Floors, which launched in San Francisco in March, provides users with a free, comprehensive database of available office space listings, along with photos and relevant information. The goal of the site is to make the usually painful and frustrating search for office space hassle-free. The search engine serves businesses of all sizes, but 42Floors’ “growth hacker” Darren Nix told me 80 percent of its queries are for spaces between 1,000 and 6,000 square feet, making its “sweet spot” companies with 5 to 50 people.

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Lovely is a real estate rental listing company based in San Francisco that went nationwide this fall. It has an agreement with 3taps, the company locked in a legal battle with Craigslist over the ownership of that real estate data, but Lovely also works with landlords and property management companies to independently list available items and aggregate similar postings from across the web. And not surprisingly, compared to the antiquated Craigslist website, it’s well, pretty lovely to use. The company is launching a new iPhone app Wednesday that’s just one of many features modern renters demand.

Like many San Francisco residents, I eventually found my apartment in the city through Craiglist and a lot of luck. But in thinking about the problems with Craigslist – not being able to save listings, not being able to search by map or location, not being able to effectively sort by price or type of apartment — Lovely provides an excellent contrast, and I wish I’d had it available when I moved in May.

The site has all of these features Craigslist lacks and more, allowing users to sort their favorite listings, set alerts on properties they’re interested in, and contact landlords with a basic renter’s bio. Lovely looks most similar to Padmapper, since both sites begin with a map and let users narrow down their search by price and rental type. But the Lovely interface feels a little more modern than Padmapper, and when searching apartments in my neighborhood, it seemed Lovely had far more complete data than Padmapper did.

But if 3taps loses its legal battle with Craigslist and can’t provide that data anymore, could Lovely still prove useful? CEO and founder Blake Pierson said he thinks it can, since they’re working to create direct relationships with landlords and software companies that work with property management groups to post listings.

“Obviously they’re sorting stuff out,” Pierson said of 3taps and Craigslist, noting that 3taps data makes up about one third of data on the site. “But it varies city by city, and would have more of an effect in certain cities than others.”

The new iPhone  app was the most-requested feature from users so far, Pierson said. Lovely isn’t disclosing user numbers yet, but Pierson said he estimates the San Francisco renter market might include 15,000 to 25,000 people, and Lovely has reached about one quarter of those renters so far (in that they’ve checked out a Lovely listing in the city.) Lovely earns revenue from landlords who list their properties on the site that turn into transactions, when renters report that they’ve found their apartment through the site.

Lovely will also experiment with featured listings, but Pierson said he distinguishes the company from competitors like Trulia or Zillow, which rely more on traditional advertising. The company has backing from investors including Keith Rabois, Benjamin Ling, Walter Kortschak and Thomas Byrne.

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This is the fourth acquisition for Zillow, a real estate listing site that boasts over 110 million postings of homes for sale, for rent, and those not currently on the market, and connects potential home buyers and renters with potential lenders on the Zillow Mortgage Marketplace. The company switched out CEOs in 2010, moving current CEO Spencer Rascoff into the spot, and went public in July 2011.

Buyfolio allows homeowners to create a database of potential listings of interest and then share those listings with a broker or between spouses, who can add notes to the listings and update with information. Buyfolio also provides listings and information on the NYC housing market, which can be added to a user’s database. The company has versions available for the Apple iPhone and iPad, as well as Android, and has a suite of products intended for real estate brokers as well.

Zillow said it plans to offer Buyfolio’s online and mobile products, and in September, Rascoff spoke at GigaOM’s Mobilize conference on his company’s success at monetizing on mobile, nothing the 14 different apps they had available.

Earlier this month, the company’s stock took a tumble after disclosures of communication between Rascoff and the Securities and Exchange Commission that questioned how the company was reporting its sales, although analysts said the communication wasn’t necessarily cause for concern, CNN Money reported.

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“The companies that are really struggling are the ones for whom the mobile monetization is a nuisance for the user,” said CEO Spencer Rascoff at GigaOM’s Mobilize conference in San Francisco. “But with real estate, the mobile ad unit actually enhances the user experience.”

Rascoff pointed out that unlike social media sites or areas where mobile ads are just distracting for users, real estate sites are areas where they’re looking to purchase something and find information, so the advertising is a good fit rather than an annoyance. The company, which went public in July 2011, has optimized its product for mobile, rolling out 14 different apps for phones and tablets.

“That wasn’t easy, it took a lot of brute force to get a 100-plus person company to get away from desktop to mobile,” Rascoff said, noting that it meant changing the company’s name and working on prioritizing the mobile web throughout the company. “It took a year or two to find our footing from a design experience,” he said. “But it was easier for us to get into mobile because of our category.”

In talking about the race for mobile, Rascoff said he thinks some companies have actually moved too fast in trying to adapt for advertising, when they don’t yet have a total grasp on how it will fit with their business.

“I think the most common mistake would be overzealous monetization from mobile,” he said.

Check out the rest of our Mobilize 2012 coverage here, and the live stream can be found here.

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The real-estate blog Curbed and its sister food and shopping sites, Eater and Racked appear to be bucking that trend.  The sites, which are owned by Lockhart Steele, cater to local audiences looking for buildings, restaurants or sales. How has he made local pay when others like AOL’s hyper-local network, Patch, have flopped?

“It’s a little counterintuitive. We’re a local company that’s not really interested in local advertising,” says Steele, explaining that the sites’ primary sponsors are national brands with big ad budgets like Ben & Jerry’s or Absolut Vodka.

Steele says big brands use Curbed to tap into local communities of shoppers, foodies or home buyers in different regions. He cites a recent example in which Curbed threw a party in Portland on behalf of Patron Tequila. “We can activate audiences in each of these cities we’re in, and activate a real community.”

Steele says there simply isn’t enough money in local advertising – with one exception. “The one place you can sell local is real estate … It’s the only category of hyper-local that’s really flush with money.”

The Mobile Morass: it’s ok to sit on the sidelines

Publishers are watching with growing consternation as audiences are moving en masse to mobile devices but ad dollars are not. Steele admits he doesn’t know how or when the mobile riddle will be solved but says he is not concerned.

Steele says it’s unrealistic to expect readers to download a publisher’s app unless you offer “non-stop engagement like Netflix” and adds that apps “create another distracting channel that you have to worry about.” He says Curbed is content to watch the mobile experiments of companies like Conde Naste which have been more bullish about apps.

“A lot of interesting start-ups in the digital media space are sitting on the sidelines .. We’re happy  to see big guys throw around hundreds of thousands on development. We’ll keep our powder try and watch others. If someone hits on the right strategy, we’re not above copying it.” In the meantime, Curbed is content to look for niche mobile opportunities like email newsletters and monetizing the screen that launches when a reader first downloads an app.

Why blogs are beautiful & Gawker’s still got it

Steele says his favorite sites are those that use a traditional blog layout like the Awl or Andrew Sullivan. He believes in a format that lets readers “scroll down and know when they’re full,” versus busy homepages like New York magazine which Steele describes as “seizure-inducing” (though he loves NY mag’s content).

Does he still follow Nick Denton, his former mentor and boss at Gawker, where Steele was the gossip site’s longtime managing editor?

“I still think Nick is one of the most interesting people in media. When it comes to product vision in this media space … I think Nick is pushing forward some of the most interesting ideas,” he said, citing Gawker’s recent attempt to transform the idea of reader comments.

Who else? Steele calls Jim Bankoff and Vox Media the “standard bearer for the media space,” He says sites like Vox Media’s The Verge are “the most beautiful on the web” for their seamless integration of text, audio and video.

Display ads are the Future

No really. While prominent display skeptics like BuzzMedia’s Jonah Peretti claim that banners (those ads that stretch across the top and side of web pages) belong to an earlier era of web publishing, Steele disagrees. “Display advertising is the future. Part of the reason is that display is also the past – people made fun of banners when they debuted on Hotwire in 1995.”

Steele’s point is that display advertising is a staple of the internet economy that publishers and advertisers now know how to buy, use and sell. He says companies continue to see these ads as powerful opportunities to build brand image. This is different than revenue from “click-through” ads about which “no one has illusions.”

To make display advertising work, Steele says, it’s important to keep ad sales in-house. “Giving inventory to ad networks puts you in a world of spiraling CPM’s.”

New York is tech and San Francisco is media (and vice versa)

“The old idea that New York created media and San Francisco created great product is out the window,” says Steele, citing Foursquare, the popular location-based social network, which long shared a roof with Curbed. He believes both cities are pushing each other to improve media platforms and publications. But that doesn’t mean he likes them equally.

“I’m a tried and true New Yorker. If lived in San Francisco, I’d have to kill myself. Other than that it’s a great city.”

(Images by Etienne Volschenk, Kiselev Andrey Valerevich and upthebanner via Shutterstock; L. Steele image via Flickr)

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Times are particularly hard for smaller companies — ones that have not raised mega-rounds of fundings. Things are going to get even harder for many of them. And they would have guys like Pinterest and Palantir to thank for the real estate inflation.

Even though Facebook has moved out of Palo Alto, founder friends tell me that things have not changed much. Palantir, the shadowy and fast growing company, has been gobbling up real estate space. It is rumored to have taken hold of the vast building that was previously occupied by Borders. The real-estate market in Palo Alto is so tight that even a liberally funded company like Pinterest is having to look elsewhere.

If you look at the infographic below, you’ll see office space is to be had in San Francisco for about $3.55 per square foot per month versus $5.78 per square foot per month in downtown Palo Alto or $4.81 per square foot per month in the Palo Alto-Stanford Park area. Menlo Park rents are running at $5.21 per square foot per month.

No surprise that Pinterest is now looking to move to San Francisco. Friends in the real estate market say that it has been toying with the idea of taking over the spot previously occupied by Digg. The rising office rents are only part of the story for startups. The tech boom is boosting demand for housing for tech workers and that is causing civic discord.

Earlier this month, The New York Times in an article noted:

Apartment rents have soared to record highs as affordable housing advocates warn that a new wave of gentrification will price middle-class residents out of the city. At risk, many say, are the very qualities that have drawn generations of outsiders here, like the city’s diversity and creativity. Families, black residents, artists and others will increasingly be forced across the bridge to Oakland, they warn.

“A combination of being a bedroom for Silicon Valley and companies like Twitter establishing headquarters in the city has driven up rents extremely in the past year or so,” said Ted Gullicksen, director of the San Francisco Tenants Union.

RealFacts, a company that compiles rent data in many cities, said the average rent at 50 large apartment buildings it tracks here was now $2,663 — a record.

So if you are are a founder and wondering what to do – you might want to check out this infographic created by Justin Bedecarre of Cushman & Wakefield, a real estate company.

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DotLoop, a startup that wants to simplify all of the complicated paperwork associated with large transactions like buying a house, was founded in Cincinnati, Ohio and recently opened up an office in San Francisco. For startups outside of the Valley, Allison offers insight as to why he is making the move. According to him:

• Conservative midwestern towns don’t foster the risk-taking nature of entrepreneurs
• Cincinnati has great marketing talent, but there is more technical talent out west
• Employees in Cincinnati don’t quite understand the mindset of working at an early stage startup environment

Allison isn’t entirely down on his (former) hometown. Cincinnati does have much cheaper real estate (less than $10 per square foot), and because DotLoop is a hot company in Cincinnati, there is a loyalty there that can’t be matched in the Valley, where hot, new companies sprout up every day. But we’d love to hear from other entrepreneurs in the midwest. What do you think of Allison’s assessment and reasons for his move? Leave a comment and let us know.

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Founder Jason Freedman told me that he founded the startup in part out of his own frustrations with finding office space in the past. “As a serial entrepreneur, I’ve looked for office space in the past and it’s really frustrating,” he said. Looking for an office, he posits, shouldn’t be that different from looking for your dream home. But whereas the residential real estate market has generally worked hard to make its listings Internet friendly, there wasn’t a comparable way to find office space online.

The biggest issue is that there’s little transparency: In doing research for 42Floors, Freedman asked multiple brokers to share their top listings and was told that each had proprietary data. However, once he got those listings sent, each had all the same spaces listed, which all came from the same third party and had the listing house’s logo stamped on it.

To combat this issue, Freedman spent a lot of time trying to build trust in the commercial real estate community. That meant working with multiple brokerage agencies and even taking a course to become a broker himself. Once he had that trust, he was able to get listings sent to him, but then there was another issue: Each agency had its own format for those listings. Some sent Word docs, some sent PDFs, some even sent Excel spreadsheets of all the properties they had listed.

But once it had that data, 42Floors was able to add those listings into its database. Instead of just providing a list of specs and prices, the startup wanted to give potential tenants a feel for what the space looked like before they decided to check it out. So it hired a professional photographer to go around to various offices and take pictures of the space. Together with an interface that lets those searching see where different locations fall on a map, the startup has simplified the process of scanning through multiple office locations.

42Floors has launched in beta in San Francisco with plans to expand into other cities soon. The startup is offering its services for free now, but plans to take a referral fee once it’s out of beta. The 42floors team is five strong now, with 10 advisors, most of whom are from the commercial real estate world. And it’s gotten financial backing from YCombinator, SV Angel, Start Fund and Andreessen Horowitz.

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