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Wireless - Tuesday, February 5, 2008

Blue Frog Media Croaks

Having raised $16M from Canaan Partners and MK Capital, Seattle's Blue Frog Mobile has filed for bankruptcy protection and counts liabilities up to $1M. The Seattle PI tries to document the ugliness of the situation and finds that those who should be working 24/7 to unwind the company have jumped ship. Board member Maha Ibrahim of Canaan Partners resigned as did its last CEO Victor Siegel who moved on. The paper gets this ugly quote: "No one really knows who is running the company," said the shareholder, who asked that his name not be used. "The venture capitalists deserted the company and kind of left it adrift." If true, we find it stunning that the bankruptcy filing was made by an IT admin at the firm, who we assume was compelled to do so as he was facing pressure from creditors and couldn't find anyone else to man up.

What is odd about Blue Frog is that it competed in the ringtone business, which we believe most competent companies could make a living at. How on Earth could they have blown through so much funding so fast? It seems they really wanted to be in interactive TV and that's where much of their capital was blown.

In December, Blue Frog Media said it had cut about 55 employees and shut down its Hispanic music channel called BullaTV. About 75% of the headcount cut came in Mexico and the Philippines. At the time, it still employed 235 worldwide.