Mobile entertainment guide provider Vindigo has closed a second round of funding and trimmed 14 percent of its staff as it looks to stretch the new funds until the company reaches profitability.
The New York-based company, whose software provides movie listings and restaurant reviews to Palm-based handhelds and cell phones, landed $6.2 million in a third round of funding to be announced Tuesday, CNET News.com has learned. The company has also cut 5 of its 35 workers, but CEO Jason Devitt said in an interview Monday that the layoffs were not a financing condition.
"It was simply us being prudent," Devitt said.
Devitt said the company has received additional backing from several previous investors, led by General Atlantic Partners and including J.P. Morgan Chase, Flatiron Partners, and several small institutions and individual investors.
"We certainly don't expect to go back to the capital markets anytime soon and believe this will take us to profitability," Devitt said. He would not disclose the company's target date for profitability.
Vindigo recently added mapping to its program for Palm handhelds and is testing a wireless service that would allow owners of a Palm VII or other Palm devices with wireless modems to access Vindigo's entertainment guides without syncing to a PC. Vindigo offers guides to 20 cities, including San Francisco, New York and London.
The company is one of a host of companies, including AvantGo, looking to become an essential feature on handheld computers. Vindigo has a distribution deal that bundles its software with all new Palm m100 and m500 series handhelds.
Vindigo's consumer software, like those of its rivals, is free, with profits expected to come from advertisers looking to reach consumers right when they are looking for services. While the wireless advertising market has been highly touted, many hurdles remain such as privacy and technical concerns.
AvantGo trimmed 15 percent of its staff in April, even as it reported a narrower-than-anticipated quarterly loss and reaffirmed its outlook for the year.
Devitt said Vindigo plans in the coming months to announce support for two additional types of devices. While Devitt would not say which two devices, he offered strong praise for Microsoft's Pocket PC software, which is used on handheld computers from Compaq Computer, Hewlett-Packard and Casio, among others.
"I think Microsoft has made a great deal of progress, and we're very excited by the platform," he said.
Vindigo was among the Palm OS developers wooed by Microsoft during the PalmSource developer conference in January.
Devitt also offered praise for J2ME, the mobile version of Java supported by devices including Research In Motion's BlackBerry pagers, and for Brew, a runtime environment developed by Qualcomm.
In October 1999, Vindigo raised $750,000 in seed funding, with an additional $9 million coming from institutional backers in April 2000.