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FreedomPop Grabs $30M More in Funding

Free phone service provider FreedomPop has secured $30 million in series B venture funding and is hinting at an IPO as a potential option within the next couple of years.

The Los Angeles-based startup has now raised a total of $49.3 million in funding since it started in 2011. CEO Stephen Stokols says that the mobile virtual network operator (MVNO) isn't taking up any of the buyout offers it has received but instead considering its options, which appear to include an acquisition or an initial public offering (IPO). (See FreedomPop Grabs $5M to Support Android Push.)

"We received several M&A offers, but we ultimately decided it was premature to sell on the cusp of exponential traction," the company notes in a blog post. "Following on accelerated growth and our pending global expansion, we are confident we will create massive value within the next 12 to 24 months at which point we could revisit exit options."

FreedomPop is an independent MVNO that handles its own customer service but uses the Sprint Corp. (NYSE: S) network to offer voice over IP (VoIP) and data services, as well as running on WiFi. The operator offers a service that gives users a guaranteed 500MB of data, 500 text messages and 200 voice minutes every month free for life. (See FreedomPop Phones It In (for Free).)

Stokols told Light Reading recently that the business is largely unaffected by a change in Sprint's policy towards activating aftermarket devices for its MVNOs. This is because FreedomPop mostly sells devices direct to users. (See Sprint Policy Change Spells Trouble for MVNOs and Gambling on Used Sprint Phones: Are Users Buying a Brick?)


For all the latest news from the wireless networking and services sector, check out our mobile channel here on Light Reading.


The new money will help FreedomPop's ambitions to expand in Europe. The company plans to launch a free service in the UK this summer. The company also launched Jetsetter, a global SIM-based free service that will be initially available in the UK, Spain and France. (See Eurobites: FreedomPop Heads to Europe.)

The $30 million round is being led by Partech Ventures. Existing investors DCM Capital and Mangrove Capital also contributed to the latest round. FreedomPop says that a strategic investor, which typically means a carrier or vendor investment, is being added to the round but isn't being named yet.

— Dan Jones, Mobile Editor, Light Reading

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MikeP688 7/5/2015 | 2:52:03 PM
Re: Disrupt ..and the latest interesting "move" they made was to issue an App so that folks are able to make free phone calls over the Wi-Fi network.    I installed the APP on my old iPhone4 which gives me a "back up" phone to use.   Although it is not as vibrant (and @Mitch noted this with his comments on Wi-Fi) it is still an interesting and welcome move.  I'll be testing it over the course of the ensuing weeks further and assess it.

   
MikeP688 6/30/2015 | 10:38:52 AM
Re: Disrupt @mhhf1ve:  Can you share some of the ones you think are at the forefront of this transformation that you think are making a different?   I note this because the giants have to somehow take notice--won't they? 
MikeP688 6/30/2015 | 10:36:48 AM
Re: Disrupt Although it is ever so true, it is becoming ever so mainstream and the fact that inroads are being made.   I used to work virtually on a dial-up with Lotus Notes not so long ago--i know it means I'm dating myself--but we will get there which will force all to continue to think about the "next level".   
mhhf1ve 6/29/2015 | 6:23:34 PM
Re: Disrupt Ok. Disruption might be too strong, but Freedompop has done some innovative things like giveaway data for free to encourage more mobile usage and then make it possible to get more "free" data by participating in various chores (marketing surveys, etc).

There are now a couple more me-too MVNOs doing similar things... which might collectively "disrupt" more of the market? 
Mitch Wagner 6/29/2015 | 5:40:38 PM
Re: Disrupt Because WiFi isn't quite ubiquitous yet, and it's often a pain in the neck to set up and slow as well. 
MikeP688 6/29/2015 | 10:37:49 AM
Re: Disrupt It has--and it underscores how "Smart" we seem to be becoming as many camp grounds also have free Wi Fi available as well--which begs the question: Why use up Data Plans where we can get it for free everywhere (or almost)?

 

 
Mitch Wagner 6/29/2015 | 10:20:35 AM
Re: Disrupt Hot spot while camping, eh? I haven't been camping since about 1974. I suppose it has changed since. 
MikeP688 6/28/2015 | 11:52:18 AM
Re: Disrupt I have their "hot spot" which I use while on Camping retreats.  Their customer service leaves a lot to be desired--as I dealt with them recently on a matter.    The idea of somehow changing the space to have it be more than just a "privilege" is quite an audacious move.   Who wouldn't want to have a free "hot spot" and a "free phone"?      The challenge for them is to monetize it though--and being "married"To Sprint will be a challenge.
Mitch Wagner 6/17/2015 | 3:06:58 PM
Disrupt After two years, has FreedomPop disrupted the market? They seem to be a novelty act rather than a market leader.
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