ChaCha raises $3 million more to own mobile

Ronny Kerr · January 20, 2011 · Short URL:

One of many Q&A sites, but one with a heavy focus on mobile, gets funded by Qualcomm Ventures

Q&A site ChaCha announced Thursday that it has closed $3 million of additional funding including $900,000 of outstanding warrants from new investor Qualcomm Ventures. The relatively small round extends a $20 million Series F raised by the company in October 2010.

When one considers that ChaCha has raised approximately $75 million to date, $3 million just doesn’t seem like very much. The last time the company raised anything smaller than $5 million was a year and a half ago.

What makes the new round interesting, however, is not its size but its contributor. Previous ChaCha rounds were raised by traditional VC firms like Rho Ventures and VantagePoint as well as angels like Amazon founder and CEO Jeff Bezos. This round came from Qualcomm Ventures, the VC arm of one of the world’s leading designers and suppliers of mobile technologies. (Most notably, Qualcomm invented several CDMA wireless standards, including one for 3G networks.)

Qualcomm Ventures does not add a company to its portfolio unless that company “can add value to or complement existing Qualcomm business divisions, products and technologies.”

So, to perhaps state the obvious, I’m expecting a even bigger mobile push from ChaCha in 2011.

Though the service has been getting a lot of traffic lately, that wasn’t always the case. Back in March 2009, when the company closed a $12 million round, ChaCha also announced that it would be restructuring and streamlining its business to save costs, resulting in layoffs of over 50 employees. Manually searching for answers just wasn’t very cost-effective. And the company wanted to start focusing on mobile.

The changes must have worked, however, because the company reported in December that hit a record high of 32 million unique visitors for the month, nearly doubling the site’s traffic from January 2010.

Increasingly, however, ChaCha is being supported by its mobile users. Interviewed by VatorNews’ Bambi Francisco a couple weeks ago, ChaCha co-founder and CEO Scott Jones said that about three million, or 13 percent of the site’s users, come from mobile usage. Not only that, but mobile users are “extremely engaged,” asking around 20 questions per month. 

With a new injection of capital from Qualcomm Ventures, ChaCha is sure to keep making an even stronger push into mobile. Already, every page on the main site gives special banner space to the message, “Text Your Question to 242-242*,” and apps are available for Android, BlackBerry and iPhone. 

In the end, the real question is whether or not ChaCha can beat out the flurry of other Q&A sites, especially one which has grown significantly in the past couple months: Quora.

What do you think? What’s your favorite Q&A service?

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ChaCha answers who, what, when, where and why, and has emerged as the No. 1 way for advertisers and marketers to engage their audience. Through its unique “ask-a-smart-friend” platform, ChaCha has answered nearly one billion questions since launch from more than 15 million unique users per month via SMS text (242-242™), online (, Twitter (@chacha), Facebook app, iPhone app, Android app, and voice (1-800-2-ChaCha™). Working with major brands such as Paramount, AT&T, Palm, Johnson&Johnson, P&G, Coca-Cola, McDonald’s, Sonic, and presidential political campaigns, is one of the fastest growing mobile and online publishers according to Nielsen and Quantcast.

ChaCha was co-founded by proven innovator and entrepreneur Scott Jones and is funded by VantagePoint Venture Partners, Rho Ventures, Bezos Expeditions; Morton Meyerson, former President and Vice Chairman of EDS as well as Chairman and CEO of Perot Systems; Rod Canion, founding CEO of Compaq Computer; the Simon family; and Jack Gill, Silicon Valley venture capitalist.


Scott Jones

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