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Meebo, a web based instant messaging service has raised $9 million in series B funding from Draper Fisher Jurvetson and existing investors Sequoia Capital. The company had previously raised $3.5 million in Series A funding, mostly from Sequoia Capital. The company released its final product in November 2006, perhaps with an eye on raising new capital.
Tim Draper is the DFJ partner who is leading the investment in the year-and-half old company started by three Standord students Elaine Wherry, Sandy Jen and Seth Sternberg. Sternberg declined to give out the terms of the financing. It is interesting to note that Sequoia Capital, typically very territorial about its investments is not leading this round of investment.
Meebo is one of the players in a hotly contested web-based IM aggregation business, competing with the likes of eBuddy. While the growth of the company has been impressive, the questions around profitability and revenues of their business are still unanswered. Those are issues, which are of little concern to DFJ or for that matter any other VC these days.
DFJ was attracted to the investment, according to sources close to the company because it mirrors the growth curve of two of their previous successful deals — Hotmail and Skype. Meebo is said to have more than a million “Meebo” users and is a favorite amongst the high school kids, who often have their IM access blocked during the school hours.
(Disclosure note: Blacksmith Capital, a precursor to True Ventures, a VC firm that has backed GigaOmniMedia is an investor in Meebo.)