Despite a handful of high-profile flops, money keeps flowing in to “virtual” mobile carriers: GreatCall, which runs the Jitterbug mobile phones-for-seniors service, has raised a $38 million Series C round led by Court Square Ventures. Existing investors Steelpoint Capital, Charles River Ventures, Nauta Capital, and company founders Marty Cooper and Arlene Harris also participated in the round. GreatCall previously raised $36.6 million last year, plus an unspecified first round, according to MocoNews.
GreatCall will use the money to build out its sales channel and to “develop innovative services, applications and devices to answer the needs of its rapidly expanding customer base.”
So how many “rapidly expanding” customers does Jitterbug have? They won’t say. Why does it matter? The economics of virtual carriers — buying wholesale minutes in bulk, subsidizing phones, competing with your wholesale provider, marketing, etc. — have only favoured those that can get to scale. Many have fallen off, and even Virgin Mobile (VM), with 5 million subscribers, is in a flimsy financial state.
We think GreatCall’s idea — custom, large-print-edition mobile phones for old people, and a helpful operator — is a decent one. And many of their subscribers are probably getting their first mobile phone — so they don’t have to pry them away from a different service. But like most of the stuff we’ve seen from virtual carriers, we think the Jitterbug could be a better add-on to an existing carrier — like AT&T (T), Verizon, etc. — than a standalone company.