Vonage Gets Money, lots of it

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Vonage, the VoIP mavericks have raised $35 million in its Series B round led by New Enterprise Associates (NEA) with participation from Vonage’s senior management. The company plans to add additional area codes to its areas of service and anticipates expanding globally; first to Canada, and later next year into Europe.

BoardWatch has an interesting analysis on the company.

bq. And the company is so confident of its growth potential that CFO John Rego believes it will reach profitability in 2004 and end that year with 250,000 customers. A back-of-the-envelope calculation shows that Rego may well be on the right track. Even if all 71,000 current customers were on the company’s lowest monthly tariff of $24.99, that would still bring in $21.3 million in annual revenues, though some of this would be retained by its channel partners. And with a relatively low headcount, employee costs — if you use an average of $100,000 per head — would stand at about $20 million a year. If Vonage can expand its user base as fast as it believes it can, the CFO’s target of profitability next year looks to be achievable.

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