Ja-ching: Telefonica buys Jajah for $207M

Matt Bowman · December 23, 2009 · Short URL: https://vator.tv/n/ca6

Deal yields solid return for investors, demonstrates the power of white-labeling

 Spanish telecom Telefónica today announced the acquisition of internet phone company Jajah for $145 million euros ($207 million) in an all-cash transaction.

Jajah lets users of social services call each other without revealing their actual phone numbers, and without being tied to a PC.

The service is similar to Skype and Google Voice, but rather than go direct to consumer and battle it out with those big boys, Jajah’s founders went the white-label route. Last year, it took over Yahoo’s Voip service, then got integrated into Microsoft’s business products. This summer, worked its way into eHarmony and Match.com, enabling would-be love interests to talk without giving up their digits, and in October, the company made a simple and smart marketing move by letting Twitter users call their followers from within the Twitter environment. Tweet a follower’s name to @call, and you’re connected in seconds (provided you both sign up for the service).

That's quite a handshaking marathon.

As Larry Lisser points out, Jajah’s partnerships boosted its perceived value in very little time. Those deals provided instant credibility and turned Jajah into the go-to solution for calling any of your online “connections” without revealing your number.

Jajah was founded in 2005 by two Austrians, Daniel Mattes and Roman Scharf, who set up development in Israel and moved their headquarters to Silicon Valley. It raised $33 million from Sequoia Capital, Deutsche Telekom, Intel Capital, and others, which means investors reeled in a 6.2x return overall a good chunk of change (see Shai's clarification below). That should help Sequoia’s fundraising efforts.

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Free phone calls to anywhere on the planet, or for only as much as three cents a minute. Backed by the people who have brought you Google, Yahoo, Apple, Sun, etc...


Jajah is dedicated to bringing the world vastly improved telephony solutions at a fraction of the traditional price. We want to provide basic phone calls for free - and we truly believe it’s possible. We believe that by bringing together the best of the internet with the best of the traditional telephone industry we will be able to provide our customers with unique new solutions, solutions never before possible, at a price they’ll find irresistible.

Unlike other companies that are trying to replace the phone with the computer, JAJAH believes that phones are great the way they are. Phones work. People are not interested in headsets, downloads or hotspots. They simply want to make a call. And we completely agree.


Larry Lisser

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