M&A Alert - September 28, 2009
Nokia Agrees to Acquire Dopplr
Transaction Overview
On September 28, 2009, Nokia agreed to acquire Dopplr for a reported $15 to $22mm.
Target Description
Dopplr provides an online service for frequent travelers, enabling users to publish and share future travel plans with a group of fellow travelers via either a PC or a mobile phone. It also lets users connect with friends that live in the places of their visit and learn information about destinations. Dopplr is integrated with Flickr and Twitter. Competitive companies include TripIt, Travelmuse and Tripmate. Dopplr’s CEO / co founder, Marko Arthisari, was previously Nokia’s Director of Design Strategy. Dopplr had raised a total of €1.25mm in seed funding in September 2007 and was to close a new round of financing at the time of acquisition. Dopplr’s seed investors include Martin Varsavsky, Esther Dyson, Joichi Ito, Reid Hoffman, and the Accelerator Group (led by Saul Klein). Dopplr’s Board members include Martin Varsavsky (FON), Joichi Ito, Reid Hoffman (LinkedIn), Saul Klein (TAG), Esther Dyson (Angel), Tyler Brûlé (Meeja), Thomas Glocer (Thomson Reuters) and Lars Hinrichs (Xing). Dopplr, headquartered in the U.K, is owned and operated by Dopplr, Ltd. based in Finland.
Buyer Description
Nokia manufactures mobile devices, and provides Internet services and digital map information worldwide. Nokia’s Services Group, led by Niklas Savander, appears to have sponsored the acquisition within Nokia. Founded in 1865, Nokia is based in Finland.
The reported acquisition price of between $15mm-$22mm appears to represent a very attractive outcome in the context of what was apparently total invested funds of $1.7mm in mid 2007. It is worth noting, however, that given the two years that have elapsed since this funding, additional capital was likely deployed but not announced. Perhaps it goes without saying, but Dopplr has almost certainly generated no material revenue to date.
Strategic Rationale
Dopplr is part of a long string of acquisitions that Nokia executed as part of its services strategy. Nokia has been aggressively been pursuing a major transition to its business by seeking to complement its device hardware legacy with software and services. Nokia has branded this effort Ovi, which was launched in 2007. Niklas Savander leads this effort with Tero Ojanpera also playing a critical role. Dopplr fits nicely into Nokia’s location-based services offered via its Ovi’s maps (which offers GPS-enabled map services) and Navteq (which offers global map data). Nokia’s recent acquisitions include companies that have Dopplr’s early stage profile including Plum (a microsocial network site).
Architect Partners’ Observations
A review of Alexa data suggests that while traffic was growing, Dopplr had not been able to achieve the algorithmic user growth that suggests strong user momentum. Having said that, its top competitor, TripIt, has failed to achieve such momentum to date as well. Our speculation is that Dopplr found its financing prospects challenging and the exit to Nokia was a highly attractive alternative.