Jajah has become the latest internet phone company to be snapped up by a bigger player, with the Silicon Valley company announcing it is being acquired by Europe’s Telefónica for $207m €145m) in an all-cash transaction.
The deal is much smaller than the $3.9bn eBay paid for Skype in 2005 but larger than the rumoured $50m Google deal to acquire GrandCentral in 2007, which it renamed Google Voice.
Sequoia Capital was the lead investor in Jajah , which raised around $30m in VC funding.
Jajah had an impressive infrastructure for itsVOIP service and had been concentrating its efforts more on offering a white-label service for operators and other providersthan competing directly with Skype or Google Voice. It took over the running of Yahoo’s VOIP service last year and has also been offering its service to the enterprise market.
Trevor Healy , Jajah chief executive, told us that being bought by Telefónica did not mean the service would confine itself to the operator in future.
“There might be a situation where we will bring our own products to market for Telefónica first, but we have other operator customers around the world and we will continue to provide our service,” he said.
The CEO said rumours that Jajah may have been a Microsoft target were wrong and it had only been talking to Telefónica, where the appeal was the more than 250m subscribers it could now target.
“The driver is Telefónica’s fabulous brand and the O2 brand is also superb. From our perspective, it was how can we get to being a much larger company quicker?”
“Obviously, for Telefónica, their customers are coming and saying to them: I want to make calls on Facebook and Twitter and all these other platforms.”
Jajah will remain in Silicon Valley with Mr Healy at the helm, as a wholly owned subsidiary of Telefonica.
The company was founded in Europe in 2005 by two young Austrians, Daniel Mattes and Roman Scharf, before rebasing itself in the Valley. It has a research and development centre in Israel.
The original service was aimed at consumers who did not want to be tied to a PC to make VOIP calls. It allowed them to type in a number on it website, initiating a call to their own landline phone, which was then connected to the number they wanted.
