Mogreet proved there’s still venture capital to be found even in today’s tough climate. The company announced it raised a $5 million round of Series B financing, and it’s actually in a hiring, not freeze, mode.
New investors include Ascend Ventures, Black Diamond Ventures and Spyglass Ventures. Previous investor DFJ Frontier also participated in the round.&#
The company specializes in mobile video greetings, which can be used in lieu of a paper greeting card or a text message. “I think we’re fortunate,” said James Citron, Mogreet’s CEO. “There are a lot of trends that are impacting our business favorably.” Carriers are thirsty for data revenues, and mobile messaging is the killer application on cell phones. Advertisers are looking for new ways to reach young people who aren’t watching as much TV but are sending hundreds of text messages each month.
Consumers can buy mogreets for 49 or 99 cents through the Mogreet Website, its WAP site or through AT&T, Sprint and Alltel decks. Customers are billed via their wireless service provider bill. The company also expects to roll out subscription-based plans. Consumers also can get messages sponsored by advertisers.
Mogreet isn’t releasing customer tallies, but Citron said 25% of its customers are repeat users, and traffic spikes around certain occasions. Last Father’s Day, the company witnessed a 400% spike in traffic.
Interestingly, Mogreet saw a spike in President-Elect Barack Obama mogreets on Tuesday night. The company created a “Yes We Can” mogreet, the No. 1 mogreet on Election Day, and saw traffic pick up and accelerate throughout the evening.
Mogreet spent most of its Series A finances on building the product and getting distribution in place. It expects to use the Series B round to expand in the United States and internationally. Earlier this year, the company hired Mitch Feinman, former senior vice president of News Corp.’s Fox Mobile Entertainment, as general manager to help expand its carrier relationships around the world.