The additional equity investment, representing Comnitel's third funding round, came mostly from existing investors HgCapital of the UK and Hamburgische Landesbank (State Bank of Hamburg) in Germany. US-based SAIC Venture Capital Corporation and Enterprise Ireland also contributed to the round. The firm's total funding now sits at EUR30 million.
Comnitel makes two main products, NetworkAssure and ServiceAssure, both of which let mobile operators monitor the quality of their networks. The company's NetworkAssure product has been on the market for some time and is currently in use by a few notable operators, including O2 Ireland. It allows operators to detect faults in their mobile networks that could affect the quality of service.
ServiceAssure, which has been in the research and development phase until recently, is where Comnitel is pinning its hopes for the future. This product is much more advanced than NetworkAssure because it is able to give more detailed information about network service levels and quality. With GPRS and 3G slowing emerging throughout Europe and the US, Comnitel thinks that demand for this type of product will be high.
"With a current (GSM) voice call, if the services gets a bit dodgy you can just ignore it and continue with the call," said Comnitel chief executive officer Kieran Moynihan. "But let's say you are placing an order to buy shares with Barclay's Bank, if there is a problem with the network, you can't place the order. And increasingly companies are demanding service level agreements with operators to guarantee quality before they'll sign on for new contracts," he said.
Comnitel has as many as 10 bids in place for the installation of ServiceAssure in Europe, and it expects to receive word on their acceptance by the end of the year. Moynihan explained that he has his "fingers crossed" with regard to those tenders, and if all goes according to plan, the business should hit profitability by the end of 2003. Currently Comnitel employs 85, a number that could grow as the business signs new deals.
Moynihan also said that although the current funding environment was "frightening", he was encouraged by the willingness of existing investors to buy into the company. "It's still a challenging market out there, and it's hard to say what will happen over the next few months, but we're optimistic," he concluded.