January 30, 2023

A new startup wants to make it easier for any company to sell phone and data plans as part of their own branded mobile network subscription — and to help, it’s got the backing of big-name investors, including Google’s early-stage venture capital arm Gradient. Ventures and Uber CEO Dara Khosrowshahi.

gigs, which was founded in 2020 out of Germany and has largely flown under the radar until now, pitching itself as “Stripe for phone plans.” However, Berlin-based startup Y has graduated Combinator’s accelerator program last year and secured nearly $4 million in funding (via a convertible loan) ahead of the $20 million Series A round it is announcing today.

In short, Gigs allows any company – be it a bank, ride-hailing company, or video-streaming service – to sell their mobile phone subscription plans (including data, SMS and voice) to their customers. These plans are fully customizable to a specific use case, for example a retail chain may want to launch a fully featured mobile network with their own branding, or a 4G-enabled wearable manufacturer may want to monetize a data subscription on top of each physical unit they sell. Or, perhaps, a company’s HR department has decided it wants to send its employees their own phone plan along with the device.

What we are talking about is Mobile Virtual Network Operator (MVNO), of which there are already plenty around the world.

In the US, for example, there’s Google Fi built on top of T-Mobile and US Cellular, and the Ryan Reynolds-backed Mint Mobile, which runs off T-Mobile’s infrastructure. Elsewhere in the world, there is Aldi sour — an MVNO operated by German supermarket giant Aldi — which relies on Telefónica’s network in a handful of markets, while The UK counts dozens of MVNOs Lease spectrum from four major carriers in that country.

MVNO in a box

But while it’s already possible for any company to become an MVNO, it’s typically a difficult and time-consuming process — one that ultimately offers little flexibility. And this is where gigs enter the fray.

Today, any entity that wants to offer a phone plan (ie become an MVNO) must negotiate terms with major telecom providers — in the US these include AT&T, T-Mobile, and Verizon — which is not only an expensive process to endure. , but network integration and user subscription management require significant technical spadework involved in developing software.

Gigs, on the other hand, consolidates all telecom operators’ APIs (Application Programming Interfaces) into a single easy-to-access layer, lowering barriers to entry.

“With Giggs, companies will be able to offer phone plans in any market they operate at significantly lower costs, with the same integration in two to 14 days,” Giggs CEO Herman Frank explained to TechCrunch. “Ultimately, businesses can build their own mobile services that seamlessly fit their brand identity by building gigs of infrastructure at least 20 times faster, easier and cheaper.”

Giggs co-founder Dennis J. Bauer and Hermann Frank Image credit: Gigs

Giggs is able to offer this by purchasing large amounts of data, voice and SMS capacity, and then distributing this capacity to customers in the markets they operate in – making it cheaper for a company to negotiate prices for their own needs.

“We can structure our own plans with our own pricing and create bespoke packages depending on our customers’ needs,” says Frank. “We also have market-standard plans that you would find on other carriers, which can be resold by our customers with an attractive margin.”

sim city

While Gigs offers traditional “physical” SIM cards as a white label product, the rise of modern embedded SIM (eSIM) cards makes things easier by allowing companies to deliver virtual SIM cards in real time to any number of devices. The latest iPhones don’t even have a physical SIM card slot in the US market, which is why Giggs at least has one eye on a future where it powers digital MVNOs without a physical footprint.

In fact, the company currently enables eSIM activation by allowing the user to scan a simple QR code. And by supporting both SIM and eSIM, Gigs can effectively penetrate 100% of the market.

“The process and hurdles of integrating with carriers and being able to sell phone plans, as well as the way we deliver phone plans, are the same for both physical SIMs and eSIMs,” Frank explained. “[But] eSIM makes the last step of inserting a physical card into a device obsolete, and therefore smooths the activation process.”

Gigs SIM and eSIM

On top of the main API, the company also offers a software suite called Gigs Connect, which is essentially a hosted checkout that Frank says is “optimized for high end-user conversions.” This checkout can be embedded using a simple link pasted into the customer’s product (such as an online store selling smartwatches).

This is clearly in everyone’s interest – the easier it makes it to sell plans for smartphones, wearables or IoT devices to its own customers, the more revenue both Gigs and its customers can make.

Gigs: Plan illustrated on phones and smartwatches Image credit: Gigs

Separately, Gigs offers a phone plan and device subscription management platform called Gigs Teams for SMBs, and a dashboard that gives customers a complete view of all subscriptions, payments and analytics in a single interface.

Gigs Dashboard Image credit: Gigs

The principles behind all of this are similar to how fintech giant Stripe helps merchants sell online through a simple suite of APIs, a payment infrastructure service, or even Amazon Web Services (AWS), which is now the default cloud computing infrastructure for millions of people.

It’s all about undifferentiated heavy-lifting – allowing companies to add value to their core product or service without losing focus on their core competencies. For Gig, that means embeddable phones and data plans abstract away all the complexity typically associated with being a global network operator, reducing to just five API calls, according to Frank.

“Gigs is building the telecom-as-a-service category,” he said. We were the first to do what Stripe did for payments or what AWS did for hosting.”

Market opportunity

The MVNO market has been pegged as a $62 billion industry last year, a figure that is predicted to reach more than $91 billion within five years. But that’s without factoring in a new breed of MVNOs that can set up shop overnight, so it’s hard to assess just how big the addressable market is. really is

“Many companies we’ve spoken to in various industries have considered launching their own MVNO, or acquiring an MVNO, often after trying to set something up with a carrier for more than a year,” Frank said. “In theory, you can easily unlock new revenue streams with an MVNO, but the barriers to entry – lengthy negotiations with carriers, very high set-up costs and commitments – have proven insurmountable for most businesses.”

This is further complicated when a company wants to launch its MVNO in multiple markets globally.

“You have to overcome the same barriers to entry in every single market, which would be a long and very expensive process,” Frank continued. “With gigs, you can manage all your connectivity needs in all markets with one integration and start your own MVNO in days.”

It’s also hard for investors to ignore Giggs’ stellar cast. In addition to lead backer Gradient Ventures and Uber head honcho Dara Khosrowshahi, YC reinvested through its follow-on YC continuity The fund, alongside DoorDash CEO Tony Xu, Instacart CEO Fiji Simo and numerous angel investors across the technology landscape.

It also helps to highlight Giggs’ main target market, which will revolve significantly around US companies, although it is very much open to business elsewhere. The company’s core API officially exits beta today, and so far has been limited to “select partners,” including 70% in the US, 20% in Europe, and 10% in Asia.

It’s also worth noting that like almost every startup these days, Giggs is a remote-first company, with 30% of its headcount in Germany, 30% in the US, 20% in the UK, and 20% located in Italy, Georgia, Greece, Switzerland and South Africa, a jumble of countries around the world.

“Most of our team is American — Americans based either in the United States or in Europe,” Frank explained. “The US remains the most important single market for most technology businesses with a diverse technology scene, and it’s no different for Giggs.”

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

Related News