Kyte Reloads with $21M for Mobile Social Networks

by Cassimir Medford on 10 March 2008, 13:49

Categories: Media - Communications - Internet - Finance
Topics: finland , PricewaterhouseCoopers , sweden , Swisscom , DoCoMo Capital , nokia growth partners , Telefónica , teliasonera , Steamboat Ventures , Kyte , Intellect Capital Ventures , Walt Disney Company , National V

 

Less than three months after announcing its initial funding, mobile social networking startup Kyte on Monday said it raised $21.1 million in a second investment round led by Steamboat Ventures and Intellect Capital Ventures.

The new investment pushes Kyte's funding total past $36 million in the slowly-emerging market in which VCs poured $431.2 million in the first three quarters of 2007, according to a report from PricewaterhouseCoopers, National Venture Capital Association, Moneytree.

Mobile social networks are a lot like online social networks such as MySpace except that some part of the communications transaction occurs via a mobile device. Because of limited bandwidth and other reasons, mobile social networks have lagged their online counterparts in popularity.

But VCs continue to show faith in the potentially profitable combination of social networks and mobile devices.

San Francisco-based Kyte works with popular artists or bands who can create "channels" online where they broadcast photos, video, webcam, or blog content for their fans. Consumers can also create their own broadcast "channels."

Unlike popular online social networks, Kyte's channels are optimized for content generated and viewed using mobile phones.

"It's a quid pro quo. The fans get inside information about their favorite bands and in exchange the fans provide marketing access and critical data about themselves," said Michael Goodman, an analyst with Yankee Group. "It's a variation on the old fan club."

To date Kyte's funding has been dominated by carriers and telecommunications firms. In its first round Telefónica, Nokia Growth Partners, Swisscom, and DoCoMo Capital all participated. Intellect Capital Ventures, which co-led the second round, is the VC arm of TeliaSonera, the largest carrier in Sweden and Finland.

Steamboat Ventures is affiliated with The Walt Disney Company.