OnMobile Secures $27.8M
An early entrant into the VAS sector, the Bangalore-based company was incubated in 2000 by software and services giant Infosys Technologies Ltd. (Nasdaq: INFY) and spun out with $12 million in funding from Argo Global Capital LLC and H&Q Asia Pacific . Infosys still holds a 12 percent stake in the company.
OnMobile develops applications and services for mobile content distribution, interactive media portals, direct marketing, and mobile commerce including ticket reservations and payments.
Deployments range from domestic carriers like Bharat Sanchar Nigam Ltd. (BSNL) and Hutchison Essar , to Optus Administration Pty. Ltd. in Australia, to corporate customers such as ESPN Star Sports, FAME Cinemas, and the Indian Railway Catering and Tourism Corporation (IRCTC).
The company employs 300 staff and has offices in Mumbai, New Delhi, Singapore, and Sydney.
“We have a rich pipeline of innovative products under development, and numerous ideas on how to continue contributing value to our customer,” said founder and CEO Arvind Rao in a statement. “This funding will enable us to achieve all this and more, working closely with our new investors.”
Investors are betting big on value-added services, which account for around 10 percent of mobile revenues in India and are predicted to comprise 25 percent by 2010 -- creating a $5 billion market. The sector expects a boost once impending 3G services are rolled out across the country. (See India Prepares for 3G Rollout.)
In a country with just 3.6 million computer users compared with more than 115 mobile subscribers, the mobile phone has emerged as the equivalent of the Western PC -- providing a common platform for a range of applications and services, from shopping to gaming. (See VC Funds Flock to India.)
According to Venture Intelligence, VCs have invested $47 million in eight VAS startups over the last year.
Among the investments JiGrahak, a mobile commerce software provider, received $2.2 million in August from Helion Venture Partners -- in the first investment of its $140 million India-focused fund. (See Helion Invests in JiGrahak.) Paymate, which enables payments via text messaging, has received $5 million from Kleiner Perkins Caufield & Byers and Sherpalo Ventures, while gaming, ringtones, and multimedia provider Mauj Telecom raised $10 million from WestBridge Capital, Intel Capital , and Sequoia Capital in February.
— Nicole Willing, Reporter, Light Reading