Phone
“All we see is more innovation going on in mobile, more people doing more on mobile,” Matt Murphy, who manages the iFund in Menlo Park, California, said in an interview. “Its pretty clear that well go beyond” $100 million, he said.
Kleiner Perkins, one of Silicon Valleys best-known venture firms and a backer of Google Inc., has so far invested about $50 million in six companies developing programs for Apples iPhone and iPod Touch media player, Murphy said. They include Ngmoco, a games publisher, and GOGII Inc., a social-networking program. A seventh investment will be announced in a few weeks, Murphy said.
Apple said yesterday that more than 85,000 applications are available through its App Store, up from about 500 on opening day in July 2008. Customers have downloaded 2 billion programs, including more than half a billion this quarter alone, Apple Chief Executive Officer Steve Jobs said yesterday.
Aspiring entrepreneurs hoping to profit from the buzz around the App Store and tap Kleiner Perkins for capital may be better off looking elsewhere for funding, Murphy said. Kleiner Perkins has been inundated with business plans, with many similar ideas lacking “a story that was differentiated,” he said.
Diamond in the Rough
Instead, most of the “big ideas” are coming to the firm through Silicon Valleys established network of advisers and executives, he said.
“Every once in a while youll find a diamond in the rough,” Murphy said. “But if Im looking to find companies that are going to go public and be the next EBay, Facebook, Amazon, Google of this new mobile world, thats not the way its going to happen.”
Even so, Murphy said he appreciates the passion of smaller developers, who have created the majority of the applications available. He said they have helped spur interest in the iPhone and iPod Touch, a device that doesnt have a phone but that connects to the Internet over Wi-Fi networks.
“Its absolutely what this mobile market needed,” he said. “People needed choice. People needed to see all the different things that you could do with your phone.”
Googles Android, an operating system that runs a variety of mobile devices, is emerging as an “interesting second platform” for developers as carriers including T-Mobile USA Inc. start to release smart phones running the software, he said.
Still, attention is likely to remain on the iPhone and iPod Touch because of the size of the customer base, which is “stunningly larger that most of us expected,” he said. “Is it going to be 100 million a year from now, 200 million two years from now? I think so. Everybody still wants an iPhone.”