United Mobile Apps (UMA) developed and published mobile applications software. The company issued software products for mobile devices with a focus on connection management, device management, and data synchronization. UMA marketed its products and services to original device manufacturers throughout India.UMA had a vision of enabling access to all the User’s data ‘Everything - Everywhere.’ To implement this vision, UMA worked on a cross-platform software called Unify (U5) which had the following modules:
- USync: Synchronize data from mobile device / laptop / PC
- UManage: Manage the device remotely
- UShare: Share the backed-up data
Year of Investment: 2012
Total funding raised: USD 1.2 Million
2020 status: Shutdown
Number of rounds: 2
Co-investors: Blume Ventures, India Venture Partners & Mumbai Angels
Anirudh A Damani (aD) gives his insight behind this investment.
- Why did we invest in UMA?
aD: UMA was trying to optimize the mobile telephony infrastructure by utilizing the correct cellular network bands based on the type of data getting transmitted. So, their solution allows the network operator to use 4G for rich data applications, 3G for emails, 2G for voice calls, and GSM for SMS. The solution also allowed a seamless offloading to wi-fi for data sapping applications.
It was the perfect solution for an infrastructure challenged market like India with its notoriously poor network quality. I also liked the founding team, the right mix of engineers, and businesspeople for a complex infrastructure play.
- What were the risks involved with an investment in UMA?
aD: There were a couple of significant risks. First, the company must invest a considerable amount of money on R&D, an expense that it could not stop even if sales were slow - which was the second risk. The company had a long sales cycle and relied on the correct alignment of several external factors for its success.
- How long did you plan to invest in UMA?
aD: For a long time, I had a conviction that UMA would be my first unicorn. I had planned to hold onto it forever as UMA’s business model would make it a cash cow. Unfortunately, unfavorable market conditions dashed my expectations.
- What was the primary reason behind dead pooling UMA’s investment?
aD: As I had said earlier, the company relied on external factors for its success, e.g., the quick rollout of 4G networks to be a viable solution for network operators. The network operators would then ask handset makers to install UMA’s chip in the handset and pay a royalty to UMA per device per month.
However, the 2G spectrum allocation scam in India led to a slow 4G rollout in India. Though unconnected to India, different regions around the world also witnessed a slowdown in rolling out 4G. This stalled the company in its tracks. The company tried pivoting to a new business line, which met with moderate success, and it needed additional rounds of capital to survive the delays but failed at raising a new round.
- Are you satisfied with the efforts of the founders?
aD: Absolutely! I believe that the founders gave it their all, and factors beyond their control led to their eventual demise. I continue to have a ton of respect for the founders, and I look forward to investing in them once again!
- What mistakes did UMA make, and what was your learning as an investor?
aD: It would be incorrect to blame the founders for making mistakes for situations beyond their control. The most significant learning for me was to ensure that the founders held (at least) 60% equity before raising a Series A round.
- Would you invest in a similar startup today?