Meraki, the cheap Wi-Fi guys, get $20 million

The MIT thesis-turned-company wants to build Wi-Fi networks in India. It's starting in San Francisco.

Michael Kanellos Staff Writer, CNET News.com
Michael Kanellos is editor at large at CNET News.com, where he covers hardware, research and development, start-ups and the tech industry overseas.
Michael Kanellos
2 min read

Meraki, a start-up that hopes to bring cheap Wi-Fi to the emerging world, has raised $20 million in a second round of funding.

The company, which grew out of a Ph.D. thesis at MIT, has created inexpensive routers and a back-end networking service that balances available bandwidth between the routers and users. The end result is that the available bandwidth is used more efficiently, according to Sanjit Biswas, Meraki's CEO and co-founder.

"There are a small number of Internet connections, but they are repeated by a large number of radios" in networks based on the company's equipment, Biswas explained.

More than 1,000 networks using Meraki's routers have been set up and one of the company's big power users is Google. The company, however, will primarily aim its products and services at customers in India, Latin America, and Africa. The existing infrastructure in these places is fairly minimal, price is a key consideration, and demand is booming.

All these factors work in the company's favor, he said. The company makes routers for indoor and outdoor environments and has also come up with one that gets power from solar panels.

The goal is to provide users with 1-megabit-per-second service in places like Brazil.

To showcase its technology, Meraki will give away approximately 10,000 to 15,000 of its wireless repeaters that, in concert, will create a free wireless network covering San Francisco. San Francisco sports a lot of geographic challenges, and remains home to a lot of Internet power users. Like a lot of emerging nations, San Francisco also suffers from a mind-boggling array of political and bureaucratic problems. (I live here. I know). Earthlink and Google gave up plans to build a municipal Wi-Fi network for the city.

Meraki has an advantage in this department in that it doesn't rely on political approval. It gives or sells repeaters to people, and they erect and manage the network.

Meraki has already issued free repeaters to residents in the Mission, Lower Haight, and Upper Market neighborhoods. Overall, this covers about 2 square miles of the city, and 40,000 people have logged onto the network, said Biswas.

This being San Francisco, there is an inordinate number of iPhones tapping into it. Over 1,000 iPhones have logged on, he said. Users tell Meraki that the speeds are better than the cellular Internet service provided by AT&T.

The existing San Francisco network is served by only "tens of megabits" worth of bandwidth from the Internet, not much in the aggregate. "Not everyone uses it at the same time," said Biswas.

Investors in the second round included existing investors like Sequoia Capital, DAG Ventures, and Northgate Capital.