Despite the news of co-founder and Chairman of Blyk Media India Antti Öhrling's departure last December, Blyk is seeing steep growth in its global opt-in audience base from one million at the end of 2010, to four million during 2011. Blyk runs permission-based marketing by partnering with mobile phone operators and allowing subscribers to interact with third-party brands and the operators. The company is partnered with T-Mobile and Orange in the UK, Vodaphone in the Netherlands, and Aircel in India.
Antti Öhrling, the co-founder and inventor behind the idea of Blyk, announced he will be leaving the company to explore new opportunities. Blyk, the youth engagement media company, was founded in 2006 and has grown rapidly in Europe, India, and Southeast Asia
On his blog, Öhrling hints at the social media and mobile sector:
At the end of October we wrote about Blyk opening office in Singapore. Today they've announced that they will begin to offer the Blyk platform through Aircel in India. India has one of the largest mobile markets globally. With Blyk's focus on the youth segment, India is a dream market - 51% of the total population is young and potentially interesting for Blyk. Aircel is a Pan-Indian operator with a subscriber base of 48 million customers.
Blyk is looking to expand its business to Asia with the opening of its office in Singapore. Blyk, which pivoted some years back from a virtual mobile network operator to a service platform offering companies a way to talk with young adults through different campaigns, has previously built its business in Europe with Vodafone in the Netherlands and Orange in the UK. Susanna Hasenoehrl has been appointed to lead the operations in the Asia Pacific region. She has mobile industry experience from Nokia Siemens Networks, having worked in Thailand, Singapore and Germany.
The Finnish mobile media startup, Blyk, has closed a very impressive 17 million euro investment lead by Nexit Ventures and other individual investors. Blyk started off its path in 2006 as an ad supported virtual mobile operator, which was later pivoted to focusing on the mobile advertising platform as a business of its own. Blyk's revenues in the recent years have averaged around 12 to 22 million euros with over a six hundred thousand euro profit in 2009.
I heard of a new startup yesterday called Jongla. It's a Finnish startup, that promises to take advantage of the mobile platform and its capabilities of marketing personally. The business model is simple, sell the platform to marketers as a media. What is the platform then? It's an application that all mobile phone users can load for free and the catch here for consumers is that with the platform, they are able to send free multimedia messages to each other. The startup itself isn't very new. The company was founded already back in 2004.
Timo Ahopelto, Blyk's Head of Strategy and Business Development and a co-founder and the founding CEO at CRF Health is leaving Blyk to join co-founders of a new Finnish startup accelerator, Lifeline Ventures. Lifeline Ventures is also part of the Vigo initiative (see our previous story on Lifeline Ventures here).
Ahopelto said that he has enjoyed his time at Blyk, being part of the very first team, but that he had been thinking about setting up a startup accelerator already for a while, and when the team heard about Vigo they didn't wait. Blyk moving to its mobile operator partnering model, Ahopelto assures that Blyk is growing fast and the future for the company as youth media looks promising, even though some have their doubts. As an example of the new evolved strategy is Blyk's first deal with Vodafone in the Netherlands, where Vodafone will provide Blyk-branded consumer services to young people under Blyk user experience and ad formats.
ZilliongTV, a Sunnyvale, California based startup, is trying what everybody is talking about. They are trying to build a working model for viewing movies and TV programs over the Internet on demand. Instead of the traditional push, a functioning model for pull. There is already one, Hulu, but Hulu is very(!) much an extension of the big content owners who own the movies and does not work outside the US for this very reason. ZillionTV would be a step towards away from them, even if a small one. In effect, ZillionTV mixes Spotify, Videoplaza and Blyk models.
Just as with Spotify, ZillionTV has partnered with big content owners who are trying figure out how to monetize their content with poor results. What Spotify does for music, ZillionTV tries to do for moviews and TV programs. The vision is nothing short of Spotify's neither: To secure all the content that's ever been made in the world. Unlike many others in the IPTV industry, ZillionTV has also something to show as they have some really big companies already onboard (Warner, Universal, Fox and Disney).
I acknowledge that our postings have a been a bit video heavy lately and continue to be so this week, but still wanted to give you a few, what I think is very useful, soundbites from Michael Arrington, editor and founder of TechCrunch. Despite the on-going general post-LeWeb brouhaha in the web, this is worth a watch. Andrea Vascellari, CEO of iTive.net consultancy did a good job asking Arrington where he sees the startups given the current economic climate.
Here's the key take aways from the video:
- In a tough economic climate winners find an aggressive way to expand without spending a lof of money by
- Reducing head count
- Paying lower salaries now that they are collectively down
- Paying less for everything = lower expenses overall
- Acquiring competitors pennies for dollar when they are about to belly up
- A lot of startups make headcount adjustments already, which is probably a smart move (Think Fruugo and Blyk)
- Those startups that have better execution end up being winners (this is something that I believe always bares repeating even though it's a no-brainer)
- Remember that this downturn is different! Those who act as they acted in the previous one probably end up being one of the losers.
- You have to be quick on your feet and agile
- Those who focus on technical market analysis on what used to work tend to too poorly in the new climate: You should look at the playing field as a new one and compete given that
Dopplr, a part Finnish intention sharing online service that let's you see who of your friends are also in town you visit, announced that Marko Ahtisaari, formerly the head of Blyk's Brand & Design, has been appointed Dopplr's new CEO. The appointment will be effective 1st January, 2009. Ahtisaari is also a founding investors in Dopplr.
Dopplr's current CEO, Lisa Sounio, who is also in a relationship with Mr. Ahtisaari, will step down from the CEO position to act as Dopplr's Chairman of the board. Sounio has run her other company, a design strategy and PR agency Sonay, alongside Dopplr. Thus, effectively dividing her time between the two. This is probably partly the reason for her stepping down when Dopplr is gathering speed and thus needs a full time commitment. Another reason is very likely the second round of financing that Dopplr just received. To stir the pot, Blyk also just landed a major investment, which surely plays a part in the new arrangement along with the others.
As one of the Dopplr's investor's Martin Varsavsky said (video interview here) that the company does not currently have a clear business model. It remains to be seen whether Ahtisaari will drive the company in a new direction that will bring a clear business model with it. The new round of investors might be anxious to see even a theoretical return for their invesment in the current economic climate and be less willing to see one of their portfolio companies just building user base without any hope of a real cash flow.
Just as Blyk, an ad-funded, youth-oriented mobile virtual network operator, announced their partnership with Aito, they come and announce that they have closed a significant funding round of 40 million euros ($50.4 million) from their existing investors, which include Goldman Sachs, IFIC and Sofinnova Partners. Considerign the current economic climate this achievement is that much more significant.
But by following the news one can't but wonder whether Blyk is a startup anymore at all. MocoNews.net, a news site covering the business of mobile content, reports that just as Blyk took in the investment it also announced lay offs.
Here's a quote from Pekka Ala-Pietilä, Blyk CEO, on MocoNews.net:
[...]we are experiencing tougher times and unpredictable times ahead of us, and we like everyone else are feeling the impact, so we have to be well prepared and to do things differently internally. We are working more smartly, and we have to cut the number of people. But I can’t disclose that number.
So on one hand you have the 40 million euro that just came in and on the other you have a group of people whose services are not needed anymore at Blyk.
As said times are tough for those who try to raise financing. VC funds don't just give out money, but the firms need to work hard to get it in and commit to certain conditions. Add to that the fact that one of the investors that is part of the 40m euro round is the infamous Goldman Sachs who is known to be cut throat in everything they do, and you start to see why Blyk partly adjusted their strategy (new partnerships with operators), and especially why the people who were there for the startup stage need to go. The firm is not a startup anymore, but a full blown company that needs professional management, not some quirky founder DNA. At least this is how the investors see it and after all they are calling the shots when one decides to take that route.
We all grow up, even startups. Regardless, ArticStartup congratulates Blyk by pulling this off when most companies are busy telling each other how they should stop thinking about growing and start thinking about surviving.
Here's what a Finnish serial entrepreneur and dealmake Taneli Tikka makes of the news.
Library House, a research house on startups and other fast growing ventures, has listed 100 of the hottest mediatech companies in Europe. The 100 companies were selected by analysing companies using Library House proprietary data and an expert advisory panel. Library House also states that these 100 companies are the ones that will most likely change the mediatech world (mediatech meaning media and technology).
To our joy, we can find 3 Nordic companies in the top 10 list; Blyk (Finland), Sulake (Finland) and Stardoll (Sweden). Other companies in the top 10 were Flirtomatic (UK), MOO (UK), Where Are You Now? (UK), Dailymotion (France), King.com (UK), Playfish (UK) and Plastic Logic (UK). It's interesting to see that there is a healthy spread of gaming and entertainment companies in the top 10 as well as to note the absence of any media companies per se.
Other Nordic companies in the list were CCP (Iceland), Spotify (Sweden, Luxembourg), Betware (Iceland) and Xtract (Finland). The fact that most of the companies are from the UK or Central European countries pretty much states the overlooking of the Baltic market in total (I believe they are part of Europe, at least the last time I looked). Then again, this is exactly one of the reasons why I set about with ArcticStartup a little over a year ago - to give more insight to the Baltic and Nordic startup industries. Seems like we still have plenty of work to do.
Blyk, the free Finnish born (but operates only in UK) mobile network for 16 to 24 year-olds funded by advertising, has signed a frame agreement with Aito Technologies, a Customer Experience Management (CEM) solution provider, for the delivery and implementation of its Business-Driven CEM software product, Aito, to UK market. This follows a successful 3-month pilot installation, which began in May.
Aito takes business intelligence from network traffic data and offers Blyk an easy-to-understand, in-depth analysis of service usage, member behavior patterns and trends.
The information that the software generates is given to key staff directly involved in business management – sales and marketing managers, member service teams, product managers – in a form which is easy to use and act on.
In essence, Aito is an easy-to-implement tool that’s a user-friendly method of making sure mobile subscribers are having a great network experience, at all times, whether making a voice call, sending a text or MMS, or, in the case of Blyk, receiving relevant mobile adverts with their services. The carrier-grade Aito will provide Blyk with a 360° view of the activities and overall experience of its entire subscriber base. .
CEO of Aito Technologies, Anssi Tauriainen, said, “Like Blyk, we know that mobile advertising is set to be one of the most important business models and revenue-generating network activities offered by operators in the future [...]"
Mobile advertising has been already coming from years and is still as annoying as ever. Yet, this is hardly Aito's fault and I admit not having tried Blyk services. That said, even if Blyk works like charm, I already pay fixed monthly sum for practically unlimited calls, SMS and data and can't really imagine the future any other way. For cash-strapped 16 to 24 year-olds teens who adore brands there seems to be something there though. Blyk users receive 6 sms/mms from the chosen brands per day in exchange for 217 txts and 43 minutes of voice calls each month.
For the segment the service seems to be working: Blyk has currently 200,000 member in the UK, which is the only market they are currently serving. Now Blyk is ready to slice and dice the market data into an easy-to-use format with Aito Technologies' help and are well equipped to follow their plans to go pan-European in 2009 potentially reaching 40 million young consumers.
The advertisers seems to be happy as well: Big brands like L'Oreal have seen tremendous results with average click through rates of 29% (ranges between 12 and 43%). Quite a lead from the average mobile advertising average CTR that hovers around 3-6%.
Finnish media Digitoday knows that in addition to Blyk, Aito Technologies has currently six commercial pilots running in Europe, including Finland. Digitoday also reports that Aito has around 700 potential customers, traditional and virtual mobile operators. Along with these, Aito is going after ring tone, community and added value service providers in the mobile space, which there are around 2000 to 3000.
Despite the difficult times, Blyk and Xtract are promoting advertising (at least in a sense) as a revenue model. Blyk's business model is built around advertising as a source of revenue. Blyk confirmed they are going full steam ahead with internationalisation in a recent blog post about entering the Dutch markets in the first quarter of 2009.
In the blog post Blyk refers to an IAB research which states that consumers are sceptical about receiving ads on their mobile but become strongly willing to accept ads on their mobiles when they are incentified. Furthermore the willingness is increased by relevant ads. Something that shouldn't really be all too shocking when you use common sense.
This thinking is confirmed by Xtract in their most recent white paper titled Brands Need People and People Need Brands. Xtract argues that when ads are positioned correctly at the right touch points - they work, and people actually want to see them.
The problem with business models based on advertising usually is that the companies don't understand the difficulties the advertisers face. In SIME Helsinki, organised in September, I had multiple talks with advertisers that all these new innovative startups don't really understand the needs of the advertiser and thus only bringing about banner advertising - is not very appealing. What do you think, are the advertisers up tight or is their discontent acceptable?
Photo by trialsanderrors (CC:BY).
Normally there isn't nothing big in companies appointing CEOs or recruiting people. However, this time I believe there is something ineherently different happening in terms of Blyk that will tell the whole industry how different it is compared to a few years ago. Blyk is a Finnish based startup that offers a free mobile contract to 16-to-24 -year-olds in exchange for advertisements.
Eric Samson is the former Managing Director of Carat Belgium. Now as far as I know, Carat doesn't engage itself in mobile operator business at all. When Blyk is bringing a heavy weight advertising and marketing specialist onboard it tells about the business the company is in as well as how dedicated they are to promoting the way the company is seen.
This brings about an interesting point to many startups - how many are still focusing on technology through company recruicts, when (possibly) the focus should be on answering the market needs such as in the case of Blyk? No doubt the technological understanding is important, but isn't the customer insight even more important?
I remember talking to Marko in Paris at LeWeb3 last year and he said their target for this year is to reach 100k customers by the end of the year. Seems like they did a lot faster, some proof of the concept working even better than believed.