Bong - Boku & Zong

I have been looking at these guys since they began raising obscene amounts of money for what to me seemed like a repackaging of an old story - good for them.

Boku hit the streets with a $13m to primarily go on an acquisition spree (buying Paymo, Mobillcash etc.)
Zong raised $15m post a spin out - primarily to expand (into as many as 2 countries per month)

Obviously these guys have since then raised more money.

Quite frankly I was a little suprised, these guys are nothing but mblox, openmarket, singlepoint, Sybase365 etc. repacked in a different color palette primarily in striking or earth tones. The busness is Premium Rated SMS - PSMS. Which is a way to use a cell phone number as the primary account for purchases and then have the customers pay on their postpaid mobile bill at the end of the month. Same way  we where buying ringtones for $3.99 by sending a text to a 5 digit phone number.

Saying that in PSMS I need $15m to expand into 2 markets monthly seems like a stretch to me - the wireless operators have these services already exposed and ready to roll out. Granted the Bong's of the world need to position their services with the operators, but thats called salesman ship, somewhat similar to when they convinced the VC's to drop 10's of millions. No doubt they are good at that. Lets see if they can convince Google or Apple to spend 100's of millions buying them out, I will keep my fingers crossed for them.

I know that the Bong's are looking to pivot into other payments verticals and via other integrations, and so they should, digital sales wasn't sustainable 10 years ago and it wont be today.

Thats said I am totally impressed with their ability to raise funds - good on you.

The Carrier Imperative - JVL/ISIS and the road to eternal shame - a trilogy

I have been trying to formalize an opinion of the recently launched ISIS (formerly known as "JVL"), but I have failed in coming up with something on my own, so instead I thought "why don't I just start writing and lets see what happens" - so here goes - whatever comes to mind (I reserve the right to change my mind frequently on this topic :o) ).

Coalition of the willing could probably be applied to mean the "coalition of the folks with little choice"
The constellation may give it all away, 3 MNO's a struggling card network which primarily relies on others acceptance rails and a card issuer from the UK.

If I am to deduct strategy from the investor pool I would say that this is the objective of ISIS.
1. Mobilize the cards - MNO's
2. Drive brand awareness - Discover (Perhaps followed by a US acceptance network effort?)
3. Obtain a footprint in the largest card market in the world - BarclayCard

I guess the reason I am confused is that the JV is set up almost like a one off - unless they believe they can capture most of the market within the JV? In which case they need their heads checked. Why would CapitalOne be excited about joining as an issuer in ISIS knowing that their competitor Barclay would get dividends from their success? I wouldn't.

Isis is set up structurally almost as if the owners expect it to be a "one-of" and not a sustainable business long term in this ecosystem.

So some people around here knows that I used to be in a carrier JV heading up product development in Mobile Financial Services - The reality is that there is no need for interoperability for NFC on the carrier level. but rather on the consumer, service provider and issuer level - the MNO in most cases serve as storage and transport, which holds individual attributes for each operator.

I do however think its great that ISIS have appointed Michael Abbott, a guy who comes from the great company GE where he is used to managing hard partners, but I would guess that in 2 years from now ISIS will not be a driving force in NFC and each carrier will be doing their own things on the side. Fast forward 2 years I hope I am not chewing on my tongue.

ISIS would not make me concerned as an investor in Visa/MC, but what would make me concerned about being an investor in particularly Visa, would be their reactionary way of dealing with the JV.
The "day" after the ISIS announcement Visa ran out and did deals with BoA and WF a move that is diametrically opposite their GSMA announcement 2 years ago in Barcelona, where Pam Z told the world that Visa and the GSM operators where going to take over the world of mcommerce - really Visa? One pre-doomed JV makes you panic? in the meantime you guys are neglecting all the real growth opportunities in Latam and MEA because you all just sit around Foster City Starbucks completely unaware of how the world looks - see that makes me nervous as an investor.

In any case - I guess I went on a Visa rant, it happens to me sometime Visa is such an easy target :o)