MVNO FreedomPop scores $50M in new funding, unveils global hot spot with free data
Mobile virtual network operator FreedomPop continues to rake in the investment dough, announcing this week $50 million in new financing and pushing its total funding haul to more than $109 million.
FreedomPop, which launched its MVNO service in late 2012, said the new funding would be used to “fuel continued growth of its disruptive free mobile service and accelerate its international expansion in markets in Europe, Asia and South America, including the launch of its new Global hot spot and SIM covering initially covering the European region.”
The Global hot spot service, which also launched today, is said to tap cellular networks from various operators to provide a “seamless data connection for free.” The free data allotment amounts to 200 megabytes, with additional cellular data access priced at $10 per 500 MBs.
The product, which is priced at $60 with the SIM card, is initially available to customers in the U.S. and U.K., providing free global data in 25 countries, including the U.S. and most of Europe. FreedomPop said it plans to expand the reach of the offering to more than 40 countries by the end of the year.
In addition to expanding its service reach, the firm is looking to tap the new funding in its quest to become a top global service provider.
“FreedomPop has proven that new Internet business models work in the telecom space and has developed the technology to scale it globally,” said COO and co-founder Steven Sesar. “This new financing not only validates our capabilities, but it also ensures that FreedomPop has the capital required to become a top 10 global service provider.”
FreedomPop claims to have singed up more than 1 million customers since its initial launch. The company last November scored an undisclosed amount of funding from Intel Capital that it plans to use to expand its smartphone portfolio, including the launch next year of a Wi-Fi first model using Intel’s Sofia platform.
That funding came on the heels of a $10 million investment in the summer from telecom operator Axiata Group, which serves more than 230 million customers across Malaysia, Indonesia, India, Bangladesh, Singapore, Cambodia and Sri Lanka. FreedomPop said it plans to use its technology, business model and recent funding along with Axiata’s network, operational capabilities and local knowledge to offer a “free mobile service and simple plans to millions of mobile users.”
At that time, FreedomPop also noted that the move expands its operational model from a simple wholesale relationship like it currently has in the U.S. with Sprint, to a “more strategic commercial partnership.” The company added it was in discussions with “multiple major global carriers for strategic partnerships” across other markets.
FreedomPop announced in June it scored $30 million in series B funding from new investor Partech Ventures and existing investors DCM Capital and Mangrove Capital. FreedomPop CEO Stephen Stokols said the decision to move forward with new investments instead of a possible sale were due to its expected growth opportunities, though it has not ruled out a potential sale in the future.
“We received several M&A offers, but we ultimately decided it was premature to sell on the cusp of exponential traction,” said Stokols. “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.”
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