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Powerbrokers Combine To Support Open App Store PocketGear

08/24/2010

Durham, NC (VentureWire) -- Google Inc.'s chief executive, Research in Motion Ltd. and a venture firm have joined forces to mount a challenge to Apple Inc. and its "walled garden" business model of selling applications to iPhone users.

Jud Bowman, chief executive of venture-backed app-store operator PocketGear Inc., said Google CEO Eric Schmidt, the BlackBerry Partners Fund and Trident Capital have provided PocketGear with a $15 million Series B round to continue its bid to power application storefronts for most of the world's wireless carriers.

"Our previous investors wanted to invest again, but this whole round was taken up by these new investors," Bowman said. Schmidt made the investment through TomorrowVentures, the early-stage firm with which he is involved, Bowman added.

An attempt to reach TomorrowVentures was not immediately successful.

The investment is not just a vote of confidence for the 40-employee company, which operates out of a former Lucky Strike cigarette factory in Durham, N.C., Bowman said. It is a strong indication that powerful players favor a more open business model than what Apple has created.

"With Apple, it's a closed system," Bowman said. "It's all for one device. But open is powerful...and Android is important to us."

PocketGear, which sells applications for 2,000 different handheld phones, aims to harness that power.

The company operates an app storefront that auto-detects a user's phone model, and presents them with the free and paid apps available for that phone, the CEO said. PocketGear has some 140,000 apps on offer from 32,000 developers, he said.

But PocketGear has another line of business that has made it a partner with some of the most powerful players in mobile: The company builds and operates app stores for top phone makers and wireless carriers, including Verizon Wireless, Samsung Electronics Co., AT&T Inc., Microsoft Corp., Research in Motion and T-Mobile International AG, company materials said.

"There are 700 wireless carriers worldwide," Bowman said, "and our goal is to run app stores for all of them."

The new funding will help PocketGear hire as many as 20 new staffers, and open new offices in Latin America, Europe and Asia, he said. The round brings Trident Capital Senior Managing Director John Moragne and BlackBerry Partners Co-Managing Partner Kevin Talbot to the company's board.

PocketGear previously raised $3.5 million from Noro-Moseley Partners and Wakefield Group, Bowman said. He declined to give a valuation for the company.