Open Source Mobile: Funambol keeps growing and raises 12.5 Millions in Venture Capital

Congratulations to the Funambol team for raising 12.5 millions of funding in a series B financing led by mobile-focused venture capital firm Nexit Ventures, along with Castile Ventures (new investor) and was joined by existing investors, Walden International and HIG Ventures.

Investors are banking in a long term perspective, while Funambol is cash flow positive from the beginning of this year, so I asked my friend Fabrizio Capobianco, CEO of Funambol, the following question:

How is this money going to be spent?

Tight-ropeA tight-rope walker (funambol) by hdc.

Our plan is to use the cash to scale up the organization. In particular, around sales and operations. Commercial open source companies tend to have leads in every part of the world, which is a great thing. However, in order to follow the leads through, you need people on site (in particular if you are selling a product to service providers). Therefore, we are opening a few more offices world-wide, where we already have customers, to properly serve them and expand our presence.

Sometimes easy questions are a valuable tool to get interesting insights. Open source ISVs facing the “turning OSS users into customers” are likely to meet Lead Users – a term coined by Eric Von Hippel referring to users of a product experiencing needs actually unfulfilled and who could significantly benefit from the solution to those needs – from all over the world. If thinking global is the natural choice for open source firms, acting locally requires individualization and customizations to your customers’ needs, yet a local structure to effectively implement such needs.

As mentioned in my first interview to Fabrizio, Funambol addresses only the “top of the pyramid” (carriers, large ISP, etc), enabling also the base of the pyramid – the “free” Customers – to generate value for Funambol, as it is happening with AOL who just selected Funambol to help with synchronization of its own online and mobile mail.

In the meantime Funambol ignited also a partnership with SpikeSource, in order to address through SpikeSource and their partners other layers of the “pyramid”. Fabrizio himself commenting the partnership said:

This partnership with SpikeSource enables every company, regardless of size, to benefit from the simple implementation of Funambol’s mobile open source application.

Funambol besides fostering its community and delivering its wireless sync application for the iPhone, is creating an open source (mobile) ecosystem around its platform, as every open source firm should do.

Kudos to Fabrizio and his team!

Technorati Tags: Funambol, SpikeSource, Spikeignited, Venture Capital, Nexit Ventures, Castile Ventures, Walden International, HIG Ventures, FabrizioCapobianco, lead users, free customers, pyramid market