Jasper Raises $50M at $1 Billion-Plus Valuation For Internet Of Things: Venture Capital Dispatch: WSJ
Via Wall Street Journal:
Chief Executive Jahangir Mohammed founded Jasper in 2004 after starting a previous company, Kineto Wireless, and working at AT&T Bell Labs. He said he got the idea for Jasper when his Mercedes developed trouble during a trip to Lake Tahoe and the car’s “check engine” light went on.
After spending three hours locating and then waiting for a mechanic, he discovered that the car’s computer simply needed to be reset. The problem was too much moisture in the fuel.
He wondered why the car’s computer couldn’t have been fixed automatically, and he began to see the potential connections everywhere, he said—in traffic lights, cash registers, even in children and pets.
It was the Internet of Things, he said, but it wasn’t really about things–it was about service.
“We were clearly ahead of our time, but it was so strong for me that the world of physical things was going to get connected into a single fabric,” Mr. Mohammed said.
Jasper went through some lean times at first—the company started out as a mobile virtual network operator, packaging and reselling wireless capacity for carriers because the carriers “didn’t know how to service the market themselves,” said board member Gaurav Garg, who said he helped Mr. Mohammed develop the idea for Jasper and invested when he was with Sequoia Capital.
But eventually Jasper found itself competing with the carriers, although the company also discovered that businesses were using Jasper.
Mr. Mohammed said that in building the company, he “sweated blood” for 10 years. “We didn’t take a detour with respect to building the company,” he said. “It just took longer than I thought.”
In 2009, a Jasper product marketing manager told VentureWire that Jasper was through fundraising. Mr. Mohammed said he thought at the time that Jasper should become self-sustaining, but as he watched the impact of Apple Inc.’s iPhone on the carriers, he changed his mind and began pushing the company toward a software platform that would connect things.
Jasper’s software is now used by more than 1,000 companies from more than 20 industries and is integrated with global mobile operating groups around the world. It delivers, manages and secures connections among things, bringing in applications and services from the Internet. It routes services to customers, meters them, charges for them and shows service providers analytics on how their business is doing.
Garmin, a manufacturer of navigation devices, uses Jasper to manage the devices for businesses that have small fleets of trucks; Alarm.com uses Jasper to control the security systems it sells to residences. Both companies said they see the opportunity to use Jasper to continue to expand internationally.
Deep connections with mobile networks “are a key piece of the puzzle” because they make the software simpler for users, Mr. Mohammed said. The new money will be used to create new services and grow as fast as possible. The company, formerly known as Jasper Wireless, is also dropping the word “Wireless” from its name.
The Internet of Things is becoming a popular concept, and the next two years are critical for Jasper to get out in the market and win deals, according to Godfrey Chua, an analyst at Infonetics Research who has been following the company.
If it can execute, Jasper could be like Amazon, Mr. Chua said. “Amazon has the scale that makes the barrier to entry for newcomers so hard.”
Other investors in Jasper include Benchmark.
CORRECTION 4/16/14: This article was changed to correct the year in which Jasper Wireless was founded. It was founded in 2004. An earlier version of this article also stated that as part of the funding, Temasek gets a board seat. Temasek already had a board seat.