Just Mobile to be wound down with €2m in losses
JUST MOBILE has decided to wind down its operation just 10 months after the company was launched. The decision was taken after it failed to secure follow-on funding that would have sustained the business until it reached breakeven next year.
It is believed to have been seeking to raise about €2 million from investors.
Just Mobile has stopped accepting top-ups from customers and barred them from making international calls and using premium rate numbers. Customers will be able to run down their credit.
From next Monday, August 8th, Just Mobile subscribers will no longer be able to make calls or send texts but will be able to receive them.
The service will be discontinued altogether on August 19th.
Just Mobile was launched in October 2011 as a pre-pay virtual operator, piggybacking on Vodafone’s network. It signed distribution deals with Spar and Mace convenience operator BWG and fuel group Topaz.
At launch, it charged 20 cent a minute for calls and nine cent per text message. It offered unlimited calls and texts to any network for €18 a month.
The company was founded by Donal Lawless and Stuart Kelly and backed by Powerscourt Capital Partners, an investment vehicle led by Irish entrepreneur Seán Melly, who was the company chairman.
Stephen Brewer, a former head of Vodafone in Ireland, was a consultant and had a small stake in the business.
“We were unable to secure follow-on funding in the current environment and our main partner Vodafone and other suppliers, who have been very supportive, could not continue to support us any longer,” the company said in a statement on its website.
Five full-time staff will be made redundant while the decision also affects up to 15 people at outsourcing groups who provided support services to company.
“It’s an expensive business to be in and our customer uptake was behind where we wanted it to be,” Mr Lawless told The Irish Times yesterday.
“We ran out of runway with our partners, who were very supportive. The business climate at the moment is really, really bad.”
Mr Lawless said about €2 million had been lost on the business.
He said Just Mobile had secured “a few thousand” subscribers since its launch last October.
After a bumpy start, the company had implemented a number of changes and had “turned a corner” in recent times, he added.
“We would have hit breakeven in Q1 next year, which is a very short time for a company in this industry.”
It had targeted 30,000 subscribers by the close of the first quarter of 2012, he added. “We would have achieved that. But there’s just no investment in Ireland at present for young businesses.”
He accepted that it wasn’t an “ideal time” to launch, given the recession, but said the concept had been at the planning stage for about 18 months.
“I think we can be proud of what we did. We had a bit of hard luck. We gave it a go and were serious about it.”