Three factors are converging to make this an extraordinary time to be investing in mobile. First, network operators are aggressively upgrading their infrastructures to allow for faster data speeds and more reliable connections, while at the same time the old guard of telecom equipment vendors continues to weaken. Second, smartphone penetration is continuing to increase to the point where in the near future, smartphone sales will outpace global PC sales for the first time. These devices are also becoming more sophisticated to allow for richer media experiences through features like touchscreens, GPS, gyroscopes, and microphones. Finally, the shift to an open app ecosystem has resulted in an explosion of high quality content available on these devices.
Bessemer is currently focused on several themes in mobile:
- Mobile Data Crunch – With the increasing penetration of smartphones and ever-broadening array of apps accessing audio and video content, carriers are finding themselves unable to keep up with consumer’s insatiable demand for mobile data. Bessemer is focused on capital-efficient, primarily software-based models that help carriers expand or manage their network capacity like Intucell and Vasona.
- Mobile Advertising – Mobile advertising is exploding as advertising dollars are being driven towards parity with the time consumers spend in mobile. Following this trend, we led the seed investment in Millennial Media (IPO), which is now the largest independent mobile advertising network.
- Enterprise Mobility – Smartphones and tablets are transforming the enterprise. As IT purchasing decisions are increasingly influenced by employee-preferred apps and employee-owned devices, the need to manage and secure their use within the enterprise continues to grow. Bessemer portfolio company Apperian capitalizes on this trend by providing a secure enterprise app store for employees’ devices. Likewise, we believe there is a big opportunity to build killer custom business apps for enterprise users.
- Apps – Today’s mobile operating systems provide a fantastic foundation for new mobile applications and services. There is a tremendous opportunity for developers to build apps that leverage the unique capabilities of mobile devices to create experiences that are not possible on the PC-based web. Bessemer’s investments in Smule, Yelp (IPO), OMGpop (acq. by Zynga), and Life360 all make use of these trends.
- Consumer Security and Privacy – As mobile devices proliferate, so will mobile-facing security threats. Enterprises aren’t the only ones who need to secure their mobile devices – as consumers store more and more sensitive data on their phones, they will need to be conscious of this trend as well.
- Mobile Data Analytics – Consumers are generating huge amounts of data with their mobile phones. Location awareness, shopping behavior, and browsing patterns are just a few of the granular data points that can be tied back to a specific user, creating big opportunities in areas like ad targeting, consumer research, and bridging online/offline commerce.