Onomondo, a startup offering a dedicated wireless network for Internet of Things (IoT) devices, announced today that it has raised $21 million in a funding round led by Verdane with participation from Maersk Growth, People Ventures and The Danish Growth Fund. In an email, CEO Michael Karlsen told londonbusinessblog.com that the new money will be spent on productization, go-to-market efforts and marketing as Onomondo will scale his team from 50 to about 100 people by the end of the year.
Karlsen co-founded Onomondo with Henrik Aagaard in 2012, with the goal, in Karlsen’s words, “to expand the possibilities of what a network can solve for IoT.” Onomondo built a wireless network for IoT devices on the backs of hundreds of mobile carriers operating in more than 180 countries.
Prior to Onomondo’s co-launch, Karlsen was the CFO at indie game studio Playdead and co-founder of Tel42, a Danish network wholesaler on the Danish Telenor network. Aagaard was the CTO at Tel42 until it was acquired by IoT service provider Greenwave Systems.
“Our solution is unique in the market because… we built and managed our own network core from the ground up, providing end-to-end control and visibility from any mobile antenna around the world to any cloud,” Karlsen told me. londonbusinessblog.com in an email conversation. “We built an IoT tech stack with a set of unique electrical tools on top of it, making the service fundamentally different from anything else available on the market today.”
Image Credits: Onomondo
A network reserved for IoT devices is not a new concept. London-based FloLive has built a cloud-based solution to join private, local mobile networks for IoT connectivity. Helium and Kepler Communications eschewed cellphones from other technologies, such as miniature satellites and “LongFi,” to allow IoT devices to talk to each other. Big players like Comcast† SoftBank† Orange† SKT† KPN† Swisscom† Verizon† Vodafone were also at one point creating or maintaining nationwide IoT networks, not to mention Amazon and Samsung.
Dedicated IoT networks offer several advantages over traditional mobile networks, Karlsen says. For example, cell phone networks are typically not battery efficient because devices on the network often need to communicate with cell towers. In contrast, networks like Onomondo are optimized for long-distance data transfers and very low power consumption, and – at least in the case of Onomondo – only charge for data when devices are active.
“The IoT market has almost been conditioned to see connectivity as something to be designed and ‘tailor-made’, which has become the status quo and normalized,” Karlsen said. “So if we tell our customers that they can also use the network to double the life of their devices, halve battery consumption, reduce data consumption by 90%, reduce debugging time, save costs and increase stability with nothing but a network change, that’s when people really start to listen and realize the power of mastering the entire network architecture and aligning it with IoT.”
When a customer installs one of Onomondo’s SIM cards in their IoT devices, information about each device is sent to the cloud. As the devices move from one country to another, the platform automatically routes the connection through the local network infrastructure. The device does not need to update itself or share sensitive data with local networks, and the owner of the device remains in control, Karlsen claims.
Pål Malmros, a partner at Verdane, said companies in “wealth-rich” sectors such as transportation, manufacturing and logistics are being targeted by Onomondo’s technology. †[These industries] have long sought to leverage IoT to manage supply chains, improve automation and increase efficiency,” he told londonbusinessblog.com in an email Q&A. “By redesigning the existing connectivity architecture to create a single virtualized IoT network, without relying on the traditional network stack of operators, the Onomondo team brings a fresh, next-generation approach to the challenges facing the IoT. market is facing.”
It is indeed a difficult market. In January, Sigfox, a French IoT startup that had raised more than $300 million, filed for bankruptcy protection as the pandemic severely depressed sales. The company blamed the global chip shortage in part on squeezing the larger electronic components market and—by extension—demand for IoT device networks.
Image Credits: Onomondo
But Karlsen insists Onomondo remains resilient, recruiting about 50 new customers per quarter. Current customers are Bosch, Carlsberg and Maersk.
“Business in the first quarter of 2022 was solid and we saw a x4 increase in new customer inflows and continued triple-digit year-over-year growth within our existing customer base compared to 2021,” said Karlsen. “With this new funding, we aim to meet our planned forecast to triple our ARR twice over the next two years… [It’ll] enable us to accelerate our strategy and gain more market share, especially in Europe.”
To date, Onomondo has raised more than $26 million in capital.