Kajeet: Raking It In for the Kids
Bethesda, Md.-based kajeet announced the series B round today, bringing its total funding to $63.8 million. Draper Fisher Jurvetson led this round, which included prior investors Bessemer Venture Partners , Fidelity Ventures , Gabriel Venture Partners , and InterWest Partners .
Kajeet, which was founded in 2003, started its pay-as-you-go cellular service earlier this year. Like Virgin Mobile USA Inc. (NYSE: VM), this youth-oriented MVNO runs over the Sprint Corp. (NYSE: S) CDMA network. Virgin Mobile is one of the few MVNO ventures in the U.S. that could be described as a success. Other high-profile efforts, such as Amp'd, have flamed out fast over the last few months. (See Amp'd Switches Off.)
In this case, however, the lure of tapping into the growing market for wireless services for young people appears to have overcome any possible stigma around MVNOs for kajeet's investors. Kajeet offers pay-as-you-go services like five-cent messaging that are intended to appeal to their demographic.
In case you were wondering, the so-called word "tween" refers to a youngster between 8 and 12. [Ed note: The term is so annoying that it is likely one of the reasons our copy editors wake up screaming in the still of the night.] It appears to have its origins in Tolkien's fiction, as he used the term to describe young hobbits.
— Dan Jones, Site Orc, Unstrung