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Unstrung's Top 25 Startups

We name the Top 25 privately held companies in the wireless sector

July 19, 2002

30 Min Read
Unstrung's Top 25 Startups

Welcome, pop pickers, to the Unstrung ranking of the Top 25 privately funded firms in the wireless sector. As with any such list, whether it be Five Favorite Films, Top Ten Terrible TV Shows, or even Most Corrupt CEOs of the Millennium So Far (now there's one to toy with!), the selection will no doubt elicit excited praise, genuine curiosity, and messages questioning the legal parentage of the Unstrung team. No doubt these will not be presented to us in equal measure, but we look forward to (almost) any feedback.

So what have we come up with? Well, we have scoured the wireless world for those companies currently funded by private money -- and boy, is there a lot of 'em! But many will drop by the wayside without ever making a mark on the industry, while others will manage to open a few doors before hitting the wall. That's because to make it to the big time, or even just survive, these companies need more than just a good idea and some neat technology. They need solid financial backing; a pragmatic, dedicated, and gifted management team; a cracking marketing strategy; and -- don't forget this one -- a whack on the head with the lucky stick.

So that's what we've been looking for, in varying degrees. And following many a sleepless night and the odd emptied bottle of absinthe, we finally identified those we think will last the pace and make it to an IPO or be snapped up by a bigger fish for truckloads of crisp new greenbacks.

But that's not all!! No sir. Rather than just have one long list of 25, we decided to divvie up the market into five key sections, each with a Top 5, so we could keep an eye on the movers and shakers in services, hardware, components, applications, and back-office systems. By doing this we will be able to keep track of all the most important areas that shape the future of the wireless industry, and give us more "Top" lists to play with.

In the following pages you will be able to read about the companies that have made the inaugural Top 25 and what they are bringing to the wireless party in their own particular segment of the market.

To kick off, though, here is the complete list of the Top 25 privately held wireless companies -- and we have even dared to put them in an overall industry pecking order, just to spice things up a bit. So hold on to your ticker tape and rotten tomatoes for a few minutes more and feast your eyes on this list…:

The major decision here was about the number one position. After much deliberation, we decided that Flarion's alternative infrastructure for next-generation packet mobile networks, currently being picked over by the bods at Nextel Communications Inc. (Nasdaq: NXTL) (see Nextel Trials Flarion's Flash), is enough to take it to the top of the pile -- for now, at least.

There are also some notable omissions, particularly in the hardware section. Those who have followed the message board linked to our Top 25 announcement article will be particularly aware of this (see Privates on Parade: The Unstrung Top 25 ).

But the thing about this Top 25 is that you just don't know how long a company will manage to hold its place. We will be on the lookout for evidence that will move the incumbents up or down the rankings in their particular industry sections, so expect to see some movement in the coming months.

In the meantime, click below to check out the companies that made the cut in each of our five categories – and find out why they deserve to be in the spotlight.

Our categories are:

Remember, if you have something to say about the selection and the order, or if you know of a company that should be considered, get on the message boards and tell us what you think. And, please, no rude language!

— The Staff, Unstrung
http://www.unstrung.comThe pecking order for companies providing services, whether to end users or the wireless sector, is:

iPassIPass Inc. is an access lifeline to business people on the move, offering VPN access to their intranets, while on their travels, through fixed as well as wireless connections. It does this by aggregating service offerings from multiple operators, while handling the roaming and settlement issues for its subscribers.

With the growth in WLAN access and the advent of multiple data access offerings from mobile operators, iPass is set to play an even more important role in enabling anywhere/anytime access for corporates. The company currently offers WiFi access in more than 400 locations, and that number is growing as the number of hotspot service providers grows. It has also recently launched its own WLAN roaming protocol (see IPass Blocks 'Rogue' WLANs).

IPass has more than 700 carrier and ISP partners and 70 reseller partners worldwide. It claims to have among its customer base "many of the most recognizable corporate brands and 'Global 1000' companies."

The latest wireless advance for iPass is its partnership with Lucent Technologies Inc. (NYSE: LU), Agere Systems (NYSE: AGR), Hewlett-Packard Co. (NYSE: HPQ), ipUnplugged, and Sierra Wireless Inc. (Toronto: SW.TO) that will develop systems to allow it to offer access to its clearinghouse system for the customers of various CDMA2000 and 3G networks.

It has an impressive list of investors, ranging from Intel Corp. (Nasdaq: INTC) and Cisco Systems Inc. (Nasdaq: CSCO) to global telecom service provider Equant (NYSE: ENT; Paris: EQU) and VCs such as Crosspoint Venture Partners, Accel Partners, and APV Technology Partners. Its latest funding was in September 2000 when it raised $30 million.
Boingo WirelessDeserving of a place for its name alone (almost), Boingo is rapidly becoming known as the U.S. public WLAN access provider that has got its strategy right. It has software that works and is easy to use whenever the subscriber is in range of the hotspots (about 600 and rising). It aims to offer its service via 5,000 802.11b hotspots by the end of 2002.

These are not Boingo's own hotspots, however. In exchange for a flat fee, subscribers can "sniff out" WLAN access points operated by Boingo's local partners, with which it has wholesale access deals. Boingo's part of the equation is to integrate the access to multiple local WiFi setups into one service.

The scale gained from these wholesale deals allows Boingo to sell not only to individuals and enterprises, but to resellers, too. Deals announced in the past few months include those with EarthLink Inc. (a company started by Boingo founder Sky Drayton), GoAmerica Inc., and Fiberlink Communications Corp.

Given the model, extending its offer to the faster 802.11a and ultra-wideband technologies once they become available in public places in any scale should be relatively simple. Praise has come from many quarters, including Robert Metcalfe, inventor of Ethernet and founder of 3Com Corp. (Nasdaq: COMS), who is quoted as saying: "By tying all of these spots together and lowering the complexity of wandering among them, critical mass will be achieved, and Boingo is likely to prosper."

In December 2001 the company raised $15 million from New Enterprise Associates (NEA), Sprint PCS (NYSE: PCS), and Evercore Ventures.

Boingo has all the attributes of an Unstrung Hero.

MobilewayThis company provides a glue between mobile operators, managing mobile commerce transactions and ensuring data delivery for carriers, content providers, and enterprises. It can also handle the billing and settlement aspects of transactions on behalf of content providers. Siemens AG (NYSE: SI; Frankfurt: SIE) and MasterCard are two companies currently using Mobileway services.

To do this, it has struck agreements for direct connections between its platform and the networks of 88 mobile operators. This assures the delivery of messages and cuts costs and time for the originating party. About half of its carrier relationships include revenue-sharing arrangements.

A recent spate of deals involved agreements with three major Asian mobile carriers, SingTel Mobile, Chunghwa Telecom Co. Ltd., and Hong Kong CSL Ltd. for the provision of MSN Hotmail two-way SMS services to mobile phones.

In October, Mobileway secured $27 million in a second round of venture funding from companies including Mayfield, 3i Group PLC, and Citigroup. The company raised $9 million in its first round in Summer 2000.

The growth, and increasing diversity, of mobile messaging puts Mobileway in a great position to capture a willing market and generate recurring revenues.

EchovoxFinanced by its founders and private backers, without venture capitalists, this mobile messaging platform manager operates its inter-carrier open network (ICON) to provide companies, whether service providers or enterprises, with enhanced messaging services on an ASP basis. The ICON covers 36 mobile operators in 10 countries for premium SMS delivery and micro-billing, and an impressive 300 operators in 130 countries for the more traditional push SMS services.

With a low cost base -- its software development work is carried out in India -- and economies of scale in its service, the Echovox management says it has been in profit since February and is self-financing from its recurring revenues.

This company appears to have developed the right technology and be offering the right kind of service at the right time, as carriers and corporates alike latch on to the opportunities that existing mobile messaging has to offer. Echovox is on the verge of announcing three new "major" customers, to add to a number of smaller deals and the recent major coup of winning a pan-European content delivery contract from Reuters.

It is developing more services to offer in the second half of this year, including a gateway for GPRS and 3G networks, and is looking to the U.S. market for expansion.It names Nokia Corp. (NYSE: NOK), Ericsson AB (Nasdaq: ERICY), Microsoft Corp. (Nasdaq: MSFT), IBM Corp. (NYSE: IBM), and Intel among its partners.

This is a growing company with a focused and simple proposition that is generating cashflow and signing ever more customers.

MegabeamA pan-European public WLAN upstart, Megabeam has the opportunity to ride on the crest of a growing wave that, if some proponents are to be believed, could become a tsunami.

The company, with operations in the U.K., Italy, Germany, and the Netherlands (and with offices in Paris), offers individual and corporate access to the Internet through its growing number of WLAN hotspots. It also offers wholesale access to communications service providers and enterprises for resale to their customers.

Megabeam, which has "support" from telecom and IT companies, including Intel and Toshiba Corp., claims to have agreements to set up WLAN access points at 3,300 locations around Europe. Its service is commercially available in two main Italian airports, a number of hotels in its key territories, and a mainline train station in the U.K., and it is already being used by "20 blue-chip organizations." It has also just announced a deal to build hotspots in 15 more U.K. railway stations.

In addition, the company's Italian division has struck a "roaming" arrangement with Telia AB's HomeRun WLAN operation, whereby each others' customers can access each others' hotspots.With a headstart in a market seemingly set to explode, Megabeam could become a pioneer and a prize catch.

The radio stars taking the five top spots in the hardware category are:

Flarion Technologies Flarion has developed one of the alternatives to established third-generation network technology that looks likeliest to become a real contender, as carriers start to offer high-speed data services.

The company's Flash-OFDM (orthogonal frequency division multiplexing) technology uses a digital modulation technique that splits the signal into several different strands at different frequencies. Flarion has implemented its own version of OFDM in its RadioRouter base station, which overlays existing cell sites and spectrum and provides a routing interface to existing IP networks. The technology was spun off from Bell Labs in 1999 to create Flarion.

Flarion and its supporters say its technology offers constant data transfer rates of 1.5 Mbit/s -- even to moving vehicles -- and uses bandwidth four or five times more efficiently than 3G cellular alternatives.Headquartered in Bedminster, N.J., the company is currently running a trial with Nextel Communications Inc. (Nasdaq: NXTL), and some supporters suggest it could wrap up a deal before the end of the year (see Nextel Trials Flarion's Flash and Flarion VC Touts Carrier Trial). The firm claims to be talking to other service providers in other parts of the world, including South Korea.

Flarion has around $58 million in funding. It is backed by Pequot Capital Management Inc., Bessemer Venture Partners, Charles River Ventures, and Cisco Systems Inc. (Nasdaq: CSCO).

MeshNetworksMesh Networks has developed a "radio agnostic," wireless, peer-to-peer networking technology that can support wireless technologies such as Bluetooth and 802.11, along with the company's own quad division multiple access (QDMA) radio protocol. QDMA supports VOIP, data, and multimedia wireless transfers.

Mesh technology allows users to network with others directly over the airwaves without using access points or other kit. The more users in the ad hoc mesh the farther the data can be passed.

The technology has many applications. For instance, ViewSonic Corp. is using MeshNetwork technology for home networking-type applications for its Web pads. In-car computing vendor Delphi is testing MeshNetworks' system as a way to deliver multimedia data to moving vehicles.

This Maitland, Fla., company could actually fit in a number of categories on this list. The company provides multimode mesh networking chips, wireless routers/repeaters, and associated networking software.

Its products are derived from military technology. Formed in January 2000, the firm has "over $27 million" in funding provided by VCs such as Apax Partners and Redwood Venture Partners LLC.

AirvanaChelmsford, Mass.-based Airvana is building all-IP CDMA radio access networks using CDMA 2000 1xEV-DO (data only) technology. Airvana claims that taking an all-IP approach has two major benefits. With a pure IP backhaul network, a customer can take advantage of a traditional ATM setup, reducing the cost of implementing the network. Also, because Airvana's technology does not touch the voice network, the company envisages that it could be used in conjunction with an existing network, even one with a different air interface.

Nortel Networks Corp. (NYSE/Toronto: NT) has partnered with Airvana and plans to offer its technology as part of its portfolio. Verizon Wireless is currently running field trails with Airvana and Nortel in San Diego. Meanwhile, the company says South Korean operator KTF is actually using its equipment.

Airvana was formed in March 2000 by executives from Cisco, Nortel, and Motorola Inc. The company has raised around $81 million in funding from Matrix Partners, Qualcomm Inc. (Nasdaq: QCOM), and private investor Dr. Gururaj "Desh" Deshpande, the chairman of Sycamore Networks Inc. (Nasdaq: SCMR).

ArrayComm ArrayComm's i-Burst high-speed wireless data system uses "adaptive array antenna" technology to create a "cell within a cell" for individual users in range of its base stations, which broadcast over unpaired -- or time-division duplex (TDD) -- spectrum. Conventional cellular systems transmit signals in all directions to all the users in the range of a particular cell. In other words, along with the right signals hitting the user, the system is also pumping lots of noise or "electro-smog" into the radio frequency environment. The ArrayComm system uses software and an array of antennas to continually map the RF environment, allowing it to create a "personal cell" link with each user. ArrayComm already sells this technology, which it calls "IntelliCell," for use in conventional cellular networks.

ArrayComm, based in San Jose, Calif., has recently formed a consortium with Vodafone Australia and OzEmail to launch its system in Australia (see ArrayComm: Oz First, US Next?).

ArrayComm has also been instrumental in getting the Federal Communications Commission (FCC) to agree to auction TDD spectrum, something for which it has been lobbying for the past four years. Unpaired spectrum allows one communications channel to be used for both upstream and downstream traffic and is well suited for data packet delivery and Internet connectivity. Frequency-division duplex (FDD) transmission, the kind used by the major 3G systems, uses two separate channels for sending traffic back and forth. This makes it somewhat of a bandwidth hog compared with TDD.

ArrayComm was founded in 1992. It is headed up by Martin Cooper, the inventor of the portable cellular phone. Investors include Banc of America Securities LLC and Sony Corp. of America.

Cambridge Positioning Systems (CPS)Based in Cambridge, U.K., CPS makes network-based location technology that is cheaper to implement than GPS. The company is targeting U.S. GSM operators that need to roll out location-based technology under the FCC's E-911 Phase II mandate requirements.

The company's Enhanced Observed Time Difference (E-OTD) technology measures the time difference between when a mobile user is picked up at one cell site and when it is received at the next and calculates the user’s position from that data. AT&T Wireless Services Inc. (NYSE: AWE), Cingular Wireless, and VoiceStream Wireless Corp. have all said they implemented or will implement CPS technology in their networks. The company scooped $32 million in its last round of funding. Investors included Intel Capital and Ericsson Venture Partners.

Wot? No Tahoe?Probably the most surprising omission from this for those of you that followed the debate about the Top 25 list on our message boards is the absence of Tahoe, Megisto, or Watercove.Here's the skinny. We think all these companies are interesting. What we want to see before they make the list is proof of customer trials, which all the companies we've picked here have (at the very least).

So, for now, they are potential Unstrung Heroes that may supplant an incumbent at any time. They are...

Down the Dial: Bubbling Under the Top 5

Taking the top five positions in the component category are:

AtherosAtheros, based in Sunnyvale, Calif., beat off major rivals to release (not sample) the first 5GHz 802.11a wireless LAN chipset in 2001. The company may well be first with a dual-mode 802.11a/g chipset before the end of the year as well.

Atheros uses standard CMOS techniques to produce its chipsets, radio and all, rather than the normal, expensive radio chips. The company's chipsets also have a proprietary "boost" mode, which ramps up the maximum data transfer speeds from 54 Mbit/s to 72 Mbit/s.

Customers using Atheros chipsets include Intel Corp. (Nasdaq: INTC) and Sony Corp.

Atheros was started in 1998. It has so far raised $98 million in funding. Backers include August Capital and Fidelity Ventures.

Cambridge Silicon RadioCSR is a startup that has blazed a trail in single-chip Bluetooth design since 1999.

Users of CSR's Bluecore architecture include Microsoft Corp. and 3Com Corp. The company also offers Bluetooth modules and design kits.

CSR is one of the largest semiconductor startups in Europe, having secured more than $70 million in funding. Investors include ARM Ltd. (Nasdaq: ARMHY; London: ARM) and Sony.

SkycrossSkycross has an innovative take on that most unsung of components, the humble antenna. The company has developed a selection of different ultra-compact (often printable) antennas for Bluetooth, wireless LAN, cellular, and ultra-wideband applications.

For instance, Skycross has a 2.4GHz to 5.9GHz compact antenna for a variety of WLAN applications. Without such a component, multimode chipsets would be little more than hunks of silicon. SkyCross Meanderline antenna technology was initially created for high performance military applications by Lockheed-Sanders Corp.

Skycross was formed in May 2000 and is based in Melbourne, Fla. It has raised around $9 million in funding. Investors include Milcom Technologies.

XtremeSpectrumXtremeSpectrum has started sampling the industry's first ultra-wideband (UWB) chipset that complies with Federal Communications Commission (FCC) guidelines. Surrounded by controversy, UWB is seen by some as a technology that will replace both Bluetooth and 802.11 wireless LAN connectivity.

The technology, which is also used in radar systems, transmits data across a wide range of frequencies at the same time (hence the name), unlike narrowband systems such as Bluetooth and 802.11b. XtremeSpectrum says its chipsets can deliver data transfer speeds of up to 100 Mbit/s at 200 mW of power. It expects to ship its first commercial silicon in 2003.

The company, formed in 1998 in Vienna, Va., scored $12 million in a third round of funding in June this year. Backers include Granite Ventures LLC and Motorola Inc.Ashvattha SemiconductorSan Diego-based Ashvattha has combined GSM/GPRS, Bluetooth, and GPS positioning radios on a single chip. The firm's aim is to deliver silicon that will enable cellphone manufacturers to deliver smaller, cheaper, and less power-hungry multifunction devices.

Ashvattha expects to start sampling chips by the end of the year, moving into volume production in 2003. The firm claims its architecture can easily be modified for CDMA and 802.11 applications.

Ashvattha has gotten $4.5 million in funding. It is backed by Comstellar Technologies Inc. and Redwood Venture Partners LLC.

Down the Dial: Bubbling Under the Top 5

Making up the Top 5 in the software apps section are:

Webraska Mobile TechnologiesWebraska Mobile Technologies SA is one of the most well known providers of technology platforms that enable location-based services (LBS). This, combined with its established customer base, takes it to top place in the Software I category.

The French firm's merger, last year, with California-based AirFlash was billed as a combination of Airflash’s experience in application development with Webraska’s strength in geo-spatial technology and telematic applications. It also puts the firm in a strong position to influence crucial work on standards and interoperability and gives it a more visible international presence, particularly in the U.S.

In January 2001 Webraska raised €50 million in second-round financing, but had only €23 million left by the end of the year and expenses of nearly €1 million per month. Unusually for a privately-held firm, Webraska also reported revenues for the year (€17 million) and says it anticipates reaching profitability in early 2003.

Obviously, €17 million in revenue for a firm with big-name customers such as Telecom Italia Mobile S.p.A, Vodafone Group PLC (NYSE: VOD), Orange SA, and E-Plus Mobilfunk GmbH isn’t outstanding, but it’s more indicative of the immaturity of the LBS market than of problems at Webraska itself. Fortunately most operators still expect services that use location information will become a core source of revenue.

And when there is an increase in spending on LBS technology Webraska will also benefit from an a series of resale and distribution deals it has with partners such as Signalsoft Corp., CMG PLC, IBM Corp. (NYSE: IBM), LM Ericsson (Nasdaq: ERICY), and Nortel Networks Corp. (NYSE/Toronto: NT). A key challenge for Webraska will be to make this resale channel work.

Air2WebAir2Web offers a development platform that that uses XML- and Java-based APIs (application programming interfaces) to modify corporate applications to run on a wide variety of SMS, WAP, PocketPC, i-mode, RIM, Palm, and J2ME devices.

The focus on text-based services, email, and calendar type applications is well aligned with today’s market; and Air2Web’s experience working with a host of different devices will be an advantage in the future when many new multimedia services will also need to be backward-compatible.

The platform has a wide market reach, in that it is offered as a hosted or standalone product and is also used by operators offering managed services to their own customers. Air2Web India provides international coverage and works with channel partners throughout the Far East.

Air2Web’s acquisition of fellow startup 2Roam earlier this year added eBay Inc., among others, to its customer base and underlined its solid position in the market. Other flagship users include United Parcel Service of America Inc., ABN AMRO Bank N.V., and ADC Telecommunications Inc. (Nasdaq: ADCT). Two service provider customers are Nextel Communications Inc. (Nasdaq: NXTL) and BellSouth Corp. (NYSE: BLS), both of which were also investors in Air2Web’s $20 million Series C round of funding that closed in October 2001.

Air2Web is not spectacular or flashy but is a proven performer that is making wireless data services actually happen and therefore looks well worth its place in the Unstrung 25.

ByteMobileByteMobile Inc. is one of a number of private firms developing solutions for data compression and content acceleration across wireless networks, but makes the list ahead of its competitors primarily because of an encouraging assessment of its product by flagship customer Vodafone UK.

ByteMobile offers a Wireless Optimization Service Node (WOSN) that compresses application data and smoothes the flow of TCP/IP traffic across wireless networks, resulting in a better quality of service for end users and more efficient use of network bandwidth for the operator.

The firm’s other major customer is Nextel in the U.S. As yet, ByteMobile has not made any headway in the strategically important Asia/Pacific market, even though it claims its WOSN technology can be deployed behind any air interface.

The firm initially raised $15 million and then backed this up with a $29 million second round led by Ericsson Venture Partners in December 2001. Other investors include Benchmark Capital and CrossBridge Ventures.

Optimization software is a key piece of the jigsaw for 2.5G and 3G service providers, and, despite having already seen its first casualties (BlueKite Inc.), the sector remains hot. But because the market for these products is still immature, any competitor that shows it can develop and sell a better solution will be promoted onto the list.

In the meantime ByteMobile is an Unstrung Hero (and they've got a hilarious name).

Seven NetworksThe Seven Networks platform is used by wireless operators to offer enterprise customers mobile access to Microsoft Exchange, Lotus Notes, and other corporate applications. There are a bunch of firms offering this kind of technology, but Seven makes it to the Unstrung 25 for two main reasons: its customers and the track record of company founder Bill Nguyen.

The firm’s first customer was mmO2 PLC when it launched its ConnectedMail service back in February 2001. Since then, Cingular Wireless and Sprint PCS (NYSE: PCS) have also rolled out services using Seven’s technology. For the future, Seven’s deal with Microsoft Corp. (Nasdaq: MSFT) to “integrate” its platform with the Microsoft Mobile Information Server looks like a smart move, given that most potential end users are already using Microsoft desktop applications.

For such a young company Seven looks well funded, having raised $34 million in February 2001 and a further $30 million in October 2001. Clearly, investors are hoping Bill Nguyen repeats the success he had with unified messaging venture Onebox.com, which he sold to Phone.com (now Openwave Systems Inc. [Nasdaq: OPWV]) for $850 million in April 2000.

PacketVideoIncluding PacketVideo in the Unstrung 25 is partly a bet that MPEG-4 will become the international standard for media streaming across wireless networks. MPEG-4 is included in the 3rd Generation Partnership Project’s UMTS group of standards and, at the moment, probably has more supporters than detractors -- although licensing issues need to be worked out if MPEG-4 is ever to take off in a big way.

PacketVideo is developing a streaming system that offers encoding (pvauthor), delivery (pvserver), and playback (pvplayer) of media content to and from mobile devices. Some of its technology is already used by NTT DoCoMo Inc.’s (NYSE: DCM) FOMA video streaming service, and PacketVideo is also involved in numerous trials with other carriers and development partners around the world. But it must be remembered that its products are not yet commercially proven.

Fortunately, the firm raised $100 million in its fifth round of funding in February 2001 and now has a broad and influential group of shareholders. Several of these investors, such as Motorola Inc. (NYSE: MOT) and Siemens AG (NYSE: SI; Frankfurt: SIE), are also customers as well as distribution and development partners, which raises the question of where exactly revenues will come from.

In the long term, streaming audio and video to and from mobile handsets will surely be a winner, and there’s a fair chance that MPEG-4 will be the format of choice. PacketVideo's early lead on technology therefore looks promising, even considering the risk that it won’t generate enough revenues to keep going until the market takes off.

PacketVideo is included in the Unstrung 25 because it is one of the few privately held firms with the potential to become a serious contender in a market that will see fierce competition from industry giants such as Apple Computer Inc. (Nasdaq: AAPL), Microsoft Corp., and a host of others.

The firm’s foot in the door at major carriers, such as T-Mobile and China Mobile Communications Corp., and its distribution partnerships with NEC Corp. (Nasdaq: NIPNY), Hewlett-Packard Co. (NYSE: HPQ), and Science Applications International Corp. (SAIC) will certainly help.

The Five Unstrung Heroes in the "back office" category are:

WatchMarkA relative veteran in this field -- founded in 1994 -- WatchMark has licensed its service assurance software to more than 100 wireless service providers, including some of the biggest names in the industry.

Its customers include Cingular Wireless, Verizon Wireless, and AT&T Wireless Services Inc. (NYSE: AWE) in the U.S.; T-Mobile in Europe; and Maxis Communications Bhd in Asia.

WatchMark closed its third round of VC-backed financing in December 2001 when it raised $26.6 million. Among its investors are Pequot Capital and Ericsson Venture Partners.

WatchMark has established itself as a reliable and steady supplier to wireless operators, and looks set to continue its growth, having already won customers and proven itself in North America, Europe, and Asia.

Xacct Technologies Well funded and with some high-profile carrier customers, Xacct Technologies takes the number two spot in this category.

Now five years old, this privately-held software firm has raised $82 million to date and counts Sun Microsystems Inc. (Nasdaq: SUNW), Dell Computer Corp. (Nasdaq: DELL), and Deutsche Bank AG among its backers.Current customers for its network data management and account provisioning products include Italian mobile operators Omnitel Vodafone SpA and Wind Telecomunicazioni SpA and, importantly, Manx Telecom, the mmO2 PLC company that has a commercial 3G network up and running on the Isle of Man. This gives it valuable experience in next-gen mobile data network issues and exposure as a technology partner in Europe's first 3G rollout (albeit on a small scale). Announcements such as the migration of Manx's wireline and wireless mediation onto Xacct's N2B platform, so that customers can have their fixed and mobile charges combined on one bill, can only boost its chances of winning further customers as operators seek new ways to differentiate their services.

The company says it has another 10 mobile operators currently evaluating its products and that at least two more will be publicly announced before the end of 2002.

Xacct also has its XACCTmobile product integrated with Motorola Inc.'s (NYSE: MOT) Aspira 3G solution -- though whether that is a beneficial partnership or not is perhaps moot.

Cramer SystemsTargeting mobile operators that are moving into data and need to manage their networks better and control costs is a key focus for Cramer Systems.

Its systems are engineered to help operators add new technologies and offer new services as quickly and easily as possible, a proposition that has so far attracted O2, Cegetel, KPN Mobile, Monet Mobile Networks Inc., Vodafone Ireland, and Wind as mobile customers.

Cramer has attracted investment from Broadview Capital Partners and < a href="http://www.kennetcapital.com"target="new">Kennet Capital (Broadview's early stage VC vehicle). The most recent investment was $25 million in October 2000 ($22 million from Broadview and $3 million from Kennet).

Cramer also boasts an impressive list of high-profile partners, including Nokia Corp. (NYSE: NOK), Cisco Systems Inc. (Nasdaq: CSCO), Agilent Technologies Inc. (NYSE: A), and Accenture.

Stability, focus, and a foothold in the mobile sector with systems designed for network engineers makes Cramer an Unstrung Top 25 company.

Zandan Zandan develops and markets products that test and monitor mobile data content and report on problems regarding access and incompatible protocols.

The company has 22 mobile operator customers in 14 countries, including Orange SA in France and the U.K., O2 Ltd. (NYSE: OOM) in the Netherlands and Germany, D2 Vodafone, SFR, Bouygues Telecom, Telefónica Móviles SA, and Mobistar SA.

It has about 30 staff and recently received €2.5 million in funding from BNP Paribas subsidiary BNP-Europe Telecom and Media Fund 2, which is advised by part of BNP Paribas.

As mobile customers use more data services and the number of vertical mobile data portals grows, so there will be a greater demand for such tools. With an impressive list of existing customers and a niche product suited to grow with the market, Zandan makes it into our Software II Top 5.

CellglideCellglide is another company set to make inroads as mobile data use grows first on GPRS and then EDGE and UMTS networks. Its software helps to optimize cell usage and so improve the efficient delivery of data.

The company announced $10 million of VC funding in May from Magnum Communications Fund and TLCom Capital Partners. Magnum's investors include T-Telekom, a venture holding company wholly owned by Deutsche Telekom AG (NYSE: DT), Finnish telco Sonera Corp. (Nasdaq: SNRA), and Dutch carrier KPN Telecom.

Cellglide has the backing of major carriers and the potential to make inroads with the mobile carrier community as they look to make the most of their current data infrastructure investments.

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