January 25, 2007
Inside JaJah - Margins, Manpower, And More
In this month's edition of Brand Eins there's a feature on JaJah, the Austrian Internet telephony startup that tapped Sequoia as an early investo. (Brand Eins is the first print publication your a:c euro reporter has initiated a subscription to in many years -- it's Kapitalismus issue last March is what clinched the decision).
Image Source: JaJah Blog
There were a few pieces of info that caught our eye.
-Even with its low rates, it still made a margin on mobile calls. Conference calls and SMS delivered a 60 percent margin. (At least this was the case when they started up. Later comments suggest that case may have changed somewhat.)
- JaJah has 60 employees, half in Israel. Its founders are hoping to file for an IPO at the end of 2007.
- The startup is currently negotiating with a consumer electronics manufacturer to create a JaJah enabled handset for users that don't want to be tied to their PC to initiate calls.
- In 2006 the average turnover per JaJah registered was about €7 per month, an amount the founder expected to decline as the user base expands for its free call services. Volume and a new advertising platform will make up the difference, he told the Brand Eins reporter. The startup has already started to invest in customized ads technology.
- Incumbent operators are not as anti-JaJah as you might expect -- in contrast to pure play VoIP companies, JaJah needs the so-called last mile infrastructure to complete calls.
There's also some insight into how Sequoia operates. It brought in one of the co-founders of a previous success to help the team, the founder of ICQ, one of the earliest Internet chat startups and later acquired by AOL. It also would not sign an NDA. JaJah presented anyway and when the founder wanted to power up for slide presentation, the VCs told them they "don't like powerpoint - beamer off please".
Posted at 02:10 PM | TrackBack | Permalink
January 24, 2007
Poland's Gadu Gadu Set For IPO
Poland's largest Internet chat provider Gadu-Gadu has set its IPO share price and plans to issue up to 3.71M new shares aiming to raise PLN 75.1M (about €20M) to finance foreign acquisitions and a possible entry into the mobile virtual network operator (MVNO) phone business, reports Interfax, referencing the company's prospectus published Monday. It also said the startup is looking to expand Eastwards, Ukraine and then Russia.
Since we only have limited access to Interfax (the free bits), we couldn't find out what the implied valuation is for Gadu Gadu, or what date in February the IPO is slated for.
There's some good background on the company on the eurotelco blog in a post that said way back in September that Gadu Gadu was going for an IPO. Among other interesting items, it says that Internet users in Poland opted for a homegrown Internet communications platform rather than others, such as MSN Messenger or AIM.
Read - Polish Power (eurotelco blog)
Read - Polish online communicator Gadu-Gadu eyes PLN 75.1 mln in IPO proceeds, foreign expansion(Interfax Central Europe)
Posted at 04:36 PM | TrackBack | Permalink
November 27, 2006
VOIP Startup Vertico Raises €2M From firstVentury
Vertico Software, a one year old Karlruhe-based company specialized in developing VOIP products and services for small&medium sized businesses, said today it raised €2M from firstVentury, a Heidelberg-based VC.
The startup already employs a team of 22 and has developed a softswitch PBX, which it sells as a package, or pre-installed in a server appliance under the brandname Starface (image right). It supports the kind of features businesses requires, like caller ID, call deflecting, conference calls, call routing, and connectivity for external employees. The middleware framework is Asterisk, according to the firm's website - if we read it correctly. Support for things like hotlines, virtual call centers, and integration into apps like CRM is also built in. We didn't see anything about Outlook Express integration, though.
What probably attracted the VCs the most was its managed services offering, where it hosts the soft PBX for customers, which nicely positions Vertico for growth, internationally.
Starface's user interface is browser-based and looks pretty easy to use.
Read - firstVentury equity GmbH Invests
Posted at 06:17 PM | TrackBack | Permalink
September 25, 2006
VCs Load Up On Swedish Networking Software
VCs can't seem to get enough of Swedish software companies churning out broadband network management code. Three deals have been announced in the last week, the latest being bandwidth management specialist Operax, which raised $15 million in its third round of funding, according to LightReading.
The other two are Telepo, developer of a mobility-enabling software platform targeted at businesses, and NetAdmin, which offers Internet Service Providers and network operators software to manage the devices and components in their networks regardless of the hardware manufacturer.
Operax software is hot because it offers a standards-based way to prioritze gaming and video traffic within an IP network, say the trade pub's editors.
The six year old company is headed up by Anders Lindén (CEO) and Olov Schelén (CFO and co-founder)
Read - Operax Scores $15M (LightReading)
Read - Telepo Funding By Accel (alarm:clock euro)
Read - NetAdmin Net Management Neutraliy Backed By Eqvitec (alarm:clock euro)
Posted at 08:29 AM | TrackBack | Permalink
September 14, 2006
Truphone's Cheese-y HQ And Its Wifi-VOIP Service Launch
Truphone, the British startup that offers VOIP software for WiFi enabled smartphones, launched in beta mode this week. We can't review it because we don't have a Nokia smartphone - we're either too cheap or too poor to buy one.
But we can write that it's hiring and that it might be an interesting place to work. For one thing it seems to have a dedicated early stage backer in the form of Alexander Straub of Straub Ventures, which definitely adds a bit of adrenaline to starting up the business. (More on that below.)
For another it offers good salaries (not sure if it also has stock options) and if you like cheese, its headquarters will appeal.
Truphone is (surely) the world's only tech start-up based on a working organic farm. Crockhamdale is a hand-made sheep's milk cheese, Wensleydale style. Delicious to eat, but quite tricky to find.
Truphone's HQ its located in Edenbridge, Kent in the South of England.
Image source: ecard hever hotel, edenbridge, kent
It has a brand manager job on offer. The requirements offer a clue about corporate culture. The manager should be "very new media savvy – you know your RSS from your elbow and can hold your own talking about blogs, Flickr, Digg et al; Smart and keen to learn/contribute; Marketing aware with two years experience" and there's a Product Test Manager job on offer that's paying about double what you'd get paid in Germany or south of France for the same title.
We wrote a post on Truphone a while ago and since then Straub informs us that of all the alpha-trial users, he's the one that has racked up the most minutes on his two Nokia smartphones.
The service, like others offering IP services on the phone, requires the user to download a free client and subsequently enables free phone calls to other Truphone users and to some fixed line numbers in the UK, US, Canada and a few other countries during the beta trial.
He also talks up Truphone at industry conferences and took the time to add to our first impression of Truphone.
This suggests to us that Straub is the kind of investor you'd want to have on board. There are not too many VCs in Europe that call themselves early stage investors who work like that. He's one of them.
Another is Mangrove Capital. Its partners, such as Mark Tluszcz who works closely with portfolio firm Allpeers, the company that recently lauched a P2P filesharing plugin for the Firefox browser, do it too. Just Google his name plus Allpeers and you'll see why we say that.
One other, who we see doing it is Barry Maloney of Benchmark who is racking up the air miles and talking up Bebo, the social networking site for teenies.
Read -Truphone Backer Touts Free Mobilephone Calls Over WiFi (alarm:clock euro)
Read - Barry Maloney On Bebo Business Models (e-consultancy newsletter)
Posted at 06:57 AM | TrackBack | Permalink
September 07, 2006
Triple A First Round For Ubiquisys
UbiquiSys, cellular communications hardware company, has raised a $12m Series A round from Accel Partners, Advent Ventures and Atlas Venture.
This deal comes almost a year after the Swindon-based company raised seed financing from Atlas and Advent.
We think it’s only coincidence and not a requirement for investment that the VC firm’s name begin with an “A”.
The Ubiquisys ZoneGate Box Is Targeted At Consumers With Cellphones And A Broadband Connection
UbiquiSys expects to have its boxes in market trials in 2007 and the new capital is meant to finance that effort.
For cellcos, and ultimately their subscribers, the company's products solve a problem with using 3G phones at home where costs of providing indoor cellular coverage have been prohibitive on the side of cellco, and the battery power consumption has turned off consumers (apparently it takes a lot of power to get signalling from 3G basestations).
What is more, it will enable VOIP services from cellcos.The idea is that cellcos will better be able to compete with the emerging WiFi and wireless VOIP innovations emerging on the market if they have such systems to sell.
It sounds like a good idea since 3G is being deployed in many large sized markets and cellcos need something to fight off the growing number of startups in the Wifi/VOIP area.
There is another startup we've covered that has similar gear, 4G Systems over in Germany, which was founded back in 2002 and has some early stage financing behind it too, although its core features concentrate more on cellular data services, as we understand it.
Posted at 02:04 PM | TrackBack | Permalink
July 24, 2006
Backers Of Global IP Sound Invest In Paradial
Paradial, an Oslo based Internet protocol (IP) communications software developer (VOIP, Videoconferencing and Instant Messaging software) has signed up with Kistefos Venture Capital for a $3.5M round of investment to expand.
The startup's founders wanted Kistefos on board because its parent company is backing Global IP Sound, the hot audio processing software company that supplies the likes of Skype, Nortel Networks, WebEx, Yahoo!, AOL, and EarthLink.
Paradial was founded in 2001 by key members of Ericsson's IP telephony development team. It supplies components to video conferencing vendors and messaging service providers. Its patented RealTunnel technology crosses firewalls, which, the company claims, is "probably the most comprehensive solution in the marketplace". The startup also develops multi-party conferencing and click-to-call solutions.
Read - Kistefos Venture Capital invests in Paradial (paradial)
Posted at 03:33 PM | TrackBack | Permalink
July 21, 2006
Skype'a Sales Up - But Net Figures Undisclosed
Pierre Chappaz, co-CEO of Netvibes and famous founder of Kelkoo, posted in his Kelblog the other day on the ups and downs of the eBay stock price. In passing he mentioned that Skype was going to have net sales of $50M this year - after paying telecoms suppliers but before paying operational expenses - on a total of $200M in revenues this year
We Know Skype's Investors Want To See Some Of That $1.6B Earnout But This Is An Extreme Way To Keep Operational Expenses Down (image source: Life At Skype blog)
We had to follow that one up, and looked into eBay’s latest financials release.
eBay's Communications business (which is only Skype, we believe) brought in revenues of $44 million in the second quarter, up 26 percent from the $35 million reported in first quarter of this year. If that growth continues then it will do almost $200M in sales this year.
But we could not find any reference to sales margins or net sales or net income - and neither did Om Malik who criticized eBay and its analysts for lack of such disclosures.
We asked Chappaz about his source but he declined to say - so we will just have to wait like everyone else to find out if and when eBay's initial payment of $2.6B for Skype will generate returns.
Remember that there's an additional $1.6B earnout agreement based on Skype retaining certain key managers and reaching revenue, as well as profitability milestones over the next three or four years.
Read - La Regle De 30 percent (kelblog)
Read - Skype All Talk Just Not Facts (gigaom)
Read - eBay Announces Q2-06 Financial Results (ebay investor relations)
Posted at 09:11 AM | TrackBack | Permalink
July 06, 2006
VOIP Startup Wengo Expects Breakeven Next Year
One of the speaker's names we see popping up at tech conferences this year is David Bitton. He is the entrepreneur behind Wengo, an IP telephony and chat service provider in France, and OpenWengo, the open source SIP-phone project which powers Wengo, among others.
One of the things that his presentation will contain is the message that Britton expects Wengo to hit breakeven next year. He recently disclosed that nugget in an interview he did with ZDNET in France, adding that on that day Wengo had 900,000 subscribers, about 2.3 percent of which have taken up the premium telephony and messaging service options.
It is a lot like Skype, although it doesn't utilize P2P communication. Om Malik says it more like Zoep that comes out The Netherlands. It's now on our radar, too.
Wengo is partly owned by Neuf Cegetel, an alternative telco in France. It has taken a 67 percent stake in the venture.
Read - VoIP: Wengo devient multiplate-forme et interopérable avec les outils de messagerie (zdnet)
Read - David Bitton Speaker Profile (oscon)
Read - Firefox Goes VoIP, With Extensions (gigaom)
Posted at 07:46 AM | TrackBack | Permalink
June 21, 2006
Uniqall Looks To Finance Its Challenge To Brooktrout, Intel Netstructure HMP and Co.
Makers of IP media servers, which are used for interactive voice response (IVR), voice mail, messaging, and conferencing applications, might be in for some competition from an unexpected place, in the form of a startup
coming out of Zagreb called Uniqall.
If, that is, Uniqall's founder successfully raises the capital required to ramp up sales and marketing.
Back in 2001, Uniqall founder, Boris Pavacic, decided to develop a software-only IP media server, counting on the fact that PC processors would be powerful enough to handle a software-only solution, and that VOIP was the
way the telecoms market was going.
He raised a relatively tiny amount of seed financing from local business angels and has since demonstrated that his vision was the right on the money. Pavacic says that Uniqall is generating revenues without having invested in sales and marketing, and continues R&D, having recently completed the third release of its software.
Croatia May Be Struggling To Get Ahead In This Year's World Cup, But This Team Is Doing Well In The IP Media Server Game
The Croatian startup's product is a good 20 times lower in price than the equivalent Intel hardware-based solution, according to Pavacic. Other competitors include Brooktrout, Audiocodecs, and Eicon.
To be sure, Intel is also developing a software-based IP media server product, called Netstructure HMP, which will compete with Uniqall's, but the startup's founder believes his agile and "legacy free" startup has a better
product and more incentive to drive market development.
The a:c euro is not an expert on IP media server market, but one thing we noted when comparing the two products feature sets that Uniqall's solution supports more operating systems than Intel's, including several Linux distributions and Solaris, for example, while Intel supports only Windows OS and an Intel modified version of a few Linux distributions.
Now Pavacic's next task is to find the right partner for the next stage of the firm's growth.
Posted at 10:42 AM | TrackBack | Permalink
June 08, 2006
Sweden's Tilgin= Hockey Stick Growth + IP Boxes
Tilgin, a Swedish developer of boxes that enable so-called triple play services in the home (voice, video, and broadband Internet) is reporting quick growth. It had sales of SEK 208M (about €22.6M) in 2005, up 300 percent over the previous year.
Formerly known as i3 Micro, the firm's first quarter sales are keeping up that pace, up 402 percent over the same period last year.
Tilgin sells IP set-top boxes and gateway routers to OEMs, systems integrators, and resellers that in turn sell to the residential market. It is now ranked as Sweden’s fastest growing IT-company, it says.
Read - Tilgin ranked as Sweden’s fastest growing IT-company (tilgin PR)
Posted at 11:03 AM | TrackBack | Permalink
April 11, 2006
Abbeynet Looks For Investors To Expand VOIP Biz
Five year old Abbeynet, which hails from the same part of Italy as Internet Service Provider, Tiscali, develops software and hosts a VOIP portal service (white label).
Near the end of a press release it put out this week, the firm notes that it's seeking finance to support the international marketing of its VOIP products.
The startup seems to be well established in Italy. Abbynet's solution is SIP-based, and includes a softphone, a consumer-oriented web telephony site (Chocophone), a buddy list/instant messaging service, and things like click-to-call, web-based call-centers, and email embedded with click-to-call buttons. The latter three products are targeted at businesses.
So far it has funded R&D with €8M in grants from Italian state. And according to an announcement this week, it just got another grant for €7M to integrate instant messaging, voice and video communication into a package for use by TV set-top box manufacturers.
This is yet another VOIP startup, but it has some intellectual property and some products targeting businesses. Its chances for growth could be good in the portal provider and e-commerce markets as they are less crowded wiht rivals than consumer markets. As for interactive TV market, it is a bit too early for us to call that one.
Read – Abbynet raises (press release)
Posted at 02:35 PM | TrackBack | Permalink
April 10, 2006
Comverse Buy VC-Backed Netcentrex For $164M
Comverse announced today that it will buy venture-backed Netcentrex for about $164M in cash. An additional $16M earnout is part of the deal. With trailing year revenues for Netcentrex reportedly being $46M, the firm was valued at about 3.7 times sales (half of earnout added to calculation). It has been profitable since 2004.
The French firm had been issuing a series of press releases about its rapid growth, as well as publicizing its plans for an IPO soon.
Founded in 1998, the startup raised about $34M from VCs including CDC Innovation Partners, Crescendo Ventures, Innovacom, and Newbury Ventures, among others.
Read - France's Netcentrex Mulls IPO
Posted at 01:03 PM | TrackBack | Permalink
February 14, 2006
Sweden's Enterprise SIP Co. Hotsip Bought By Oracle
Is Oracle sending a message to rival SAP that Europe is its territory as well? Oracle has been making a growing number of small but sweet M&A deals in Europe over the past few months. Hotsip is highly regarded in its field. Now will see if these nice guys from Sweden get along with the thugs from Redwood shores.
Terms are not disclosed. Hotsip had raised around $18M in VC funding since its 1999 inception, from firms like 3i, Arganor Wireless Ventures, GO Capital and Ledstiernan AB.
If you are not familiar with it, Hotsip sells SIP application servers for large scale, carrier grade SIP enabled broadband and 3G/IMS networks.
View - Hotsip Has been acquired by Oracle (Company Site)
