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Spotwave Repeats on Funding

Light Reading
LR Mobile News Analysis
Light Reading
8/23/2004

In-building wireless system startup Spotwave Wireless Inc. is talking up its latest CDN$12 million (US$9.1 million) funding investment, but is keeping a lid on specific financial goals and possible plans for a European market entry (see Spotwave Scores $12M).

Spotwave offers a miniature, laptop-size, repeater system that it claims is cheaper to buy and install than standard offerings from the likes of Andrew Corp. (Nasdaq: ANDW), CellAntenna Corp., and EMS Wireless.

Spotwave’s units wirelessly connect to carrier cell sites and are targeted at buildings in the U.S. smaller than 100,000 square feet (see Spotwave in the House and In-Building Shapes Up?).

“We don’t target million-square-feet buildings or light up the whole building,” says Connie Costigan, marketing communications manager. “We focus on problem areas within buildings rather than the whole facility.”

Founded in May 2000, the Canadian company has a headcount of 60 and has raised a total of CDN$35 million (US$27 million). It counts carriers such as Cingular Wireless, Rogers Wireless Communications Inc. (NYSE: RCN; Toronto: RCM), Sprint Wireless (NYSE: PCS), Telus Mobility, and Verizon Wireless as customers.

Spotwave’s Costigan won’t comment on any plans to repeat its success across the Atlantic and is reluctant to divulge financial goals following today's announcement. “We are not specifically stating how long it will take us to break even, but it is a possibility in the next few quarters.”

An Unstrung Insider report earlier this year praised the vendor for its “good value (units cost between $3,500 and $6,400), easy-to-deploy system.”

Costigan is naturally eager to talk up such virtues. “Because our solution is a complete product in the box there are no maintenance costs, as opposed to a traditional distributed antenna system or repeater system. The time taken to engineer that system can be substantial.”

Today’s investment includes a CDN$7 million (US$5.4 million) VC injection led by Newbury Ventures and VenGrowth Capital Partners, along with existing investors GrowthWorks WV Funds, Primaxis Technology Ventures Inc., Venture Coaches, The VentureLink Fund, and new investor RBQ Ltd. A further CDN$5 million (US$3.8 million) credit facility has been secured from the Royal Bank of Canada.

— Justin Springham, Senior Editor, Europe, Unstrung

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