Konekt gets $1.3M to create a Twilio for cellular connectivity

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The cellular industry has been plugging the internet of things for years under the “machine to machine” moniker, but it never caught on until smartphones, ubiquitous Wi-Fi, and cheaper sensors finally made the technology more accessible for makers and mainstream consumers. Yes, you can find M2M applications in industrial settings where high-dollar goods are monitored but, for the most part, the bulky expensive cellular modules and pricey data plans made the telco’s vision of the internet of things a non-starter.

That’s a shame, because there are some applications where a cellular connection is the best option. Maybe it’s for a backup connection in the home gateway if your wireline internet goes out, or for a tracking device that needs a range far beyond your Wi-Fi or Bluetooth radios. Which is why I’m interested in the news Thursday that Konekt, a Chicago-based startup founded in 2013, has raised $1.3 million. The company offers what could be an essential service for startups trying to add cellular connectivity to their devices — a universal SIM card and cloud that lets you manage those connections.

I think of it like a Twilio for the cellular world that lets anyone buy access to 2G or 3G networks for a rate that Konekt CEO Ben Forgan called “competitive.” Forgan said the company has a deal with Vodafone and a few smaller carriers that provides the SIM cards and the connectivity, which Konekt resells. But Konekt isn’t just a reseller, it has built a cloud service with a web portal and APIs that let a customer build the SIM into his or her product, and then manage the connection via the APIs and cloud.

That’s a level of service that the telcos or other M2M services providers such as Kore or Raco Wireless often would provider to smaller companies without a lot of complicated negotiations and minimum orders. Konekt will serve customers that want to build 20 devices or provision 2,000. Already Forgan said he has over 200 customers, but he can’t disclose them. Based on the contract with Voadafone, customers of Konekt would find their devices surfing the AT&T and T-Mobile networks in the United States.

I’ve seen a few startups attempt to do this in the past, and it was often the carriers and their onerous terms that held them back, so I’m hopeful that now is finally the right time for smaller companies to have agile access to cellular connectivity in a way that lets them build and prototype devices —  even if they may never grow to be huge businesses. If not, I expect that as the internet of things grows, the amount of cellular connectivity used to connect devices may not grow as quickly as it could have.

Konekt’s investors include NextView Ventures; Mucker Capital; Tyler Willis Syndicate including Maiden Lane; and several former Groupon executives.

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