Reports

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Mobile

Mobile-focused companies received the largest amount of venture capital funding as well as the number of companies funded, raising $317 million among 29 different companies. The large amount raised was skewed higher by the dominant funding event of the quarter, $185 million for Motricity, a mobile content and media provider. Motricity used $135 million of the financing to acquire the mobile services business unit from InfoSpace.

Other fundings covered a wide range of mobile applications, from direct-to-consumer services, enterprise and telecom platforms, advertising networks and mobile virtual network operators (MVNO). Notably, Amp’d Mobile, a prominent and highly funded MVNO, recently filed for bankruptcy protection, citing high bad debts from its customer base. This development cast a pall over other MVNOs, as questions were raised about the viability of the MVNO business model, which piggybacks its services on existing facilities-based networks.

A number of companies in the located-based technology sub-sector of the Mobile market received funding during the quarter:

WaveMarket- $3 million
SquareLoop- $1 million
GP Shopper- $ Undisclosed

Communications

The Communications industry saw the lowest funding amount of the four related sectors, with 5 companies receiving a total of $42 million in new venture capital, representing a 50% decrease in funding amount versus the previous quarter.

Of the funded 5 companies, Tervela, Inc. received a follow-on series C funding of $20.2 million from its syndicate of investors, notably including Robert Davoli of Sigma Partners who is a board member. The company had its first close of the round in July, raising another $15.6 million, for a total 2007 haul of $35.8 million. Tervela was founded in 2004 and is shipping its messaging solutions to the general enterprise and capital markets sectors.

Table 1

Venture Funding Activity – 4th Quarter 2007


Industry
Click Industry For Detail
($25 Subscription Req’d)
Total
Amount
Funded
% Change
Vs. Prior
Quarter
Number of
Companies
Funded
% Change
vs. Prior
Quarter
Telecom $136 Million - 5 % 13 - 8 %
Wireless $237 Million - 9 % 23 - 12 %
Mobile $317 Million + 17 % 29 - 3 %
Communications $42 Million - 50 % 5 - 17 %
Total $732 Million - 4 % 70 - 8 %

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