Euro VOIP World Braces for Romans
VOIP's a hot technology, and hot technologies attract money. That's why Andrew Romans has launched Georgetown Venture Partners with a view to brokering deals between Europe's VOIP hopefuls and the investment community (see GVP Targets VOIP Funds).
Romans is looking to give companies a leg-up onto the VOIP bandwagon and make some money in the process. And, like so many, he's noticed there's no shortage of investors willing to plow their money into this sector (see Netrake Rakes In $20M Funding , NEA Invests in Vonage, Net2Phone Raises $58.5M, Acme Closes $15M Round, and Core Capital Invests $3M in VocalData).
But that sort of deal-making requires experience, right? Oh, yes. And Romans doesn't lack experience. In fact, he founded The Global TeleExchange (The GTX), one of several bandwidth exchange players that launched and then folded as the Internet bubble expanded and deflated.
Among the firms that lost their money with an investment in The GTX were Washington Investment Partners, which invested an unknown sum of money, and Lucent Technologies Inc. (NYSE: LU), which contributed $25 million worth of equipment to help The GTX build its ATM backbone.
But wait! There's more! Romans has some industry experience to go with his deal-making resumé. He's been working at softswitch vendor Sentito Networks as head of its European operations since last summer. He also did a stint with OSS firm Motive Communications Inc.
Romans is still working for Sentito on a consultancy basis, and he's still listed as the European sales contact on the vendor's Website. He says he'll be completely independent of Sentito by the end of February. Sentito says Romans has been integral in setting up partnerships and deals during its recent push into Europe (see Sentito Opens London Office), and that there are no formal links between it and Romans's new venture.
So what will Romans actually do? His pitch is that he can help companies determine the funds and technologies they need to get into the VOIP services market. He'll help raise those funds and then source the right systems and help broker key service elements such as interconnect deals.
Romans contends that traditional money men lack the expertise to know the detailed technical requirements that match particular service strategies. Offering VOIP services to domestic broadband users requires one set of technologies, while providing VOIP to SMEs requires something completely different. Romans says he knows what's needed for the different scenarios and can advise investors and operators alike.
"Companies looking to do the equivalent of Vonage in Europe probably won't know what technology they'll need or the best place to get it," he says.
Romans says he'll make money by taking a cut of the funds he raises and a small equity stake in his customers as reward for his endeavors. His plan is to ultimately raise funds and invest directly in companies rather than act as a broker and adviser.
To do that he'll need some measure of success first, but he says he's already talking to service providers in Europe and investors in the U.S., including some that have already put money into VOIP operators in North America, and that his connections in the equity sector are good. "It was Core Capital Partners that brought me into Sentito last year," he says.
Romans says he's already in talks with service providers and equipment companies that are looking for funds to break into the VOIP market or expand their presence. Key targets are companies "already generating revenues from other services or telecom equipment" that need additional funding to ride the VOIP wave. Working with startups is "hard work and full of risk."
— Ray Le Maistre, International Editor, Boardwatch