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FreedomPop Opts Not to Sell, Raises $30 Million Instead

The company is also working to shore up its admittedly poor customer service.


After considering selling itself, upstart freemium mobile carrier FreedomPop has decided instead to go it alone. This week, it picked up $30 million in fresh funding.

The new funding round was led by European venture capital Partech Ventures, with existing investors DCM Capital and Mangrove Capital also taking part. An unannounced strategic investor will be revealed later, FreedomPop said.

Last month, the company said it was expanding into Europe, confirming at the same time it was weighing either an investment or a sale.

“We actually had multiple offers on the M&A side,” CEO Stephen Stokols said in an interview. “It just felt premature to sell.”

FreedomPop is one of a number of new-wave carriers that sells a service using a different business model combined with service provided by one of the major carriers. FreedomPop’s approach is to offer a certain amount of voice, texting and data for free and make money off additional use and other services.

Stokols said among the factors that led it not to sell was the belief the company would be worth three to four times more in the coming year after it grows its business internationally. Oh yeah, and Stokols said he was catching up on Season 1 of Silicon Valley and was inspired by the fictional Pied Piper’s decision to stay independent.

“That actually influenced us indirectly,” he said.

FreedomPop also plans to look into retail partnerships, with Stokols saying to expect FreedomPop on one “big box” retailer’s shelves around October. Until now, FreedomPop’s devices and service have been available exclusively online.

But Stokols said he isn’t yet sold that a presence in stores is what’s needed.

“I don’t know about the importance of it,” he said, adding that there has been a lot of interest from retailers wanting to sell FreedomPop gear. “We are going to test the waters. … If it plays well, we will expand.”

Another big priority, Stokols said, is improving an admitted weak spot: Customer service. The company is increasing both its human ranks as well as improving the software it uses to manage customer care.

“We’ve been behind,” he said. “We had a poor experience for customers.”

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