HQ: Rolling Meadows, Illinois
Management: Kang Lee is the founder, president, and CEO. He previously served as vice president of engineering at now-defunct Auvo Technologies, a startup where he developed wireless services and applications. Lee also did stints at Motorola and AT&T Bell Labs. Co-founder and executive vice president Harry Eschel followed a similar path, working at both Auvo Technologies and Motorola.
Investors: On May 16, fastmobile announced it raised $12 million in Series B financing, co-led by Doll Capital Management and Walden International, with participation by existing investors Leo Capital Holdings and BlueStar Ventures. This round brings the company’s total funding to more than $21 million.
Business Model: The company’s core offering is called fastchat, a software application that turns a mobile phone into a walkie-talkie, allowing users to send and receive voice messages to other fastchat users, using voice-over-IP technology to deliver voice data over a cell phone’s data channels. Fastmobile offers its software to cellular services operators that are seeking to offer premium “bells and whistles” on top of regular voice service in order to compete with Nextel’s closed system. The software also supports instant messaging, picture and video messaging, and e-mail.
Competitors: Kodiak Networks, Sonim Technologies
Dirt: The company’s overall vision – to create a multimedia platform for mobile devices – is pretty compelling. Nextel popularized the walkie-talkie style interface – called push-to-talk (PTT) – on cell phones in the United States, paving the way for the acceptance of fastmobile’s technology. The advantage for fastmobile is that its technology is neutral and works with multiple vendors, allowing a Verizon phone, for example, to communicate with a T-mobile phone. With its growing list of customers, including Hutch in India and TIM in Europe, fastmobile is plugging away at expanding the adoption of PTT. However, when PTT technologies first came on the scene in 2003, to compete with Nextel, whose customer base grew from 13.3 million in 2003 to 16.2 million at the end of 2004, a faster rate of adoption was certainly anticipated. (The Yankee Group estimates that there were roughly 1 million combined PTT subscribers from Sprint, Verizon Wireless, and Alltel by the end of 2004 – a small percentage of their overall subscriber bases.) Figuring out the right consumer pricing, which has ranged from $5 to $20, has been one hurdle. Another has been the wait for handset manufacturers to create phones that can support PTT. Right now, Nextel still has a pretty firm grip on the market.