The 1M1M Deal Radar: MobileIron, Mountain View, California

Regular readers will know that I am deeply interested in the mobile device convergence movement and frequently cover companies such as chipmakers that have benefited from the steady growth of smartphones in business. Today, Deal Radar looks at another category of beneficiary, mobile device managers. Mobile device management (MDM) platform provider MobileIron, one of the newer entrants to this market, has a comprehensive offering in a market that is “poised for growth.”

The Mountain View, California-based company was founded in 2007 by Ajay Mishra, Suresh Batchu, and Bob Tinker. After his first company, Airespace, was acquired by Cisco in 2005, Mishra recruited Batchu and Tinker to start MobileIron with him. The real moment of insight and inspiration for the company happened in a conversation with a customer when the CIO of a large public company held up his phones and said, “I don’t care about the metal and plastic, I care about the data.”

MobileIron’s response to these concerns is its virtual smartphone platform. The product aims to address four major concerns: managing high and increasing carrier costs; poor visibility on the part of companies into where, between mobile phones and laptops, their data is and how it is exposed; the use of multiple plaforms (i.e., Android, Apple, Symbian, Windows Mobile, and BlackBerry) by employees; and the need to balance security and privacy requirements with user needs as employees use their own phones to access company data.

The cloud-based platform comprises three main elements for administrators and end users. The first is advanced management, with features such as multi-OS data management; security; AcitveSync Sentry, lost phone services; remote control capability; application management; and SMS archiving. The second is mobile activity intelligence, which gives daily reports on data, voice, and SMS use and has real-time international roaming control, billing plan integration, and activity analysis, among other features. Finally, MyPhone@Work is designed for enterprise end users with features such as searchable contacts and text messages, usage analysis, an enterprise app store, and lost phone lock and wipe. The platform supports BlackBerry, Symbian, Palm Web OS, iPhone/iPad, Windows Mobile, and will soon support Android. Pricing is $4 per device per month or $75 per device license.

According to IDC, “the market for enterprise mobile device management accounted for around $265
million in sales for 2009 and will grow to $405 million in shipments, a five-year CAGR of 9.2%.” IDC predicts that the market will return to double-digit growth in 2013 as an increasing number of businesses use smartphones. MobileIron sees MDM as a truly horizontal market. Any vertical that has e-mail now has smartphones and, says the company, therefore now needs MobileIron. The early adopter markets that are the company’s target segments are healthcare, high tech, pharma, and financial services.

The company had ten betas in progress and four paying customers when it launched the platform in August 2009. A year later, MobileIron has more than sixty customers, including eight of the Global Fortune 500 companies and three of the Fortune 100. It also has partnerships with major carriers including Vodafone, AT&T, and Korea Telecom.

When MobileIron was founded in 2007, Visiongain data forecasted that IT mobility costs were $50 billion and would grow to $130 billion in 2008. The first iPhone had just been released, and Android wouldn’t launch for another year. Companies looking to purchase mobile middleware could choose from complex, expensive solutions, large SI efforts, or many point solutions. MobileIron says there were no incumbent competitors spanning both device management and security solution for smartphones, but the situation is actually more complicated. The MDM market leader is Sybase, and it is followed by Microsoft, IBM and now RIM. IDC divides the MDM market into three segments: large systems management vendors (IBM, HP, BMC, CA, Symantec, Novell, Avocent, etc.), mobility companies (RIM, Sybase, Excitor, etc.), and mobile device management pure-plays, of which MobileIron is one. Others are Odyssey Software, SOTI, B2M Solutions, Perlego, and Wavelink. Further, companies such as BoxTone and Zenprise have moved beyond just BlackBerry to develop some MDM capabilities. Tangoe and MInformation are two other companies that don’t compete directly with MobileIron but are present in MDM.

MobileIron has raised $36.3 million in four rounds of funding: a $500,000 seed round from STORM Ventures in September 2007; an $8.8 million Series A co-led by Norwest Venture Partners, Sequoia Capital, and STORM Ventures in August 2008; an $11 million series B  also co-led by Norwest Venture Partners, Sequoia Capital, and STORM Ventures in August 2009; and a $16 million series C led by Paul Holland of Foundation Capital with existing investors in August 2010.

Revenues are growing and are currently about $10 million. Mobile Iron plans to continue to grow by winning more Fortune 1000 customers, further developing its smartphone and iPad strategies, working with the reseller and operator channel partners, and developing an ecosystem of providers to collectively address problems faced by CIOs both today and in the future.

Given the size of the market opportunity, the projected growth of the category, and the company’s success thus far, MobileIron believes that it has everything necessary to build a sustainable, profitable, standalone business. Management sees an IPO as more likely than an acquisition.

Recommended Readings
MobileIron Private Vendor Watchlist Profile: A New Paradigm for Mobile Device Management (an IDC report)