Ifbyphone Funding News Roundup

Ifbyphone has received a good deal of press surrounding our funding announcement.

GoMoNews.com

One if by land, 4.6 million Ifbyphone. Internet start-up gets multi-million dollar VC investment

Ifbyphone, which provides Web-enabled phone services for small and midsize businesses, on Tuesday will announce $4.6 million in new funding from five venture firms.

Crain's Business Chicago

The money is coming from Chicago-based Apex Venture Partners and Blue Crest Capital Finance L.P., as well as Origin Ventures LLC in Northbrook, Spring Mill Venture Partners of Carmel, Ind., and i2A Illinois Innovation Accelerator Fund. Apex Venture and Origin Ventures provided money for Ifbyphone's first round of funding last year.

The 21-employee company, which sells Web and telephony applications to small businesses, plans to invest in expanded capacity for its 7,000 and growing subscribers.

"We view this new round of funding as a strong endorsement of our growth and expansion strategy," said Ifbyphone founder and CEO Irv Shapiro. "It positions us extremely well to continue our expansion during these complex economic times."

"We want to improve our ability to handle the needs of the middle market," Shapiro said. "Ifbyphone technology can automate the answering of routine call center calls, like delivery dates and hours of operation, which can be up to 25 percent of total call volume."

Shapiro said the expanded marketing operations would help to reach potential customers who might find Ifbyphone's services very attractive in a recessionary environment. He said customer support remained a top priority for the company, and he claimed that the company doesn't have customers, it just has raving fans.

One such fan is Wayne Boulais, general partner of Apex Ventures, which led both fundraising rounds.

"Ifbyphone was an attractive investment because it's successfully capitalizing on two trends," Boulais said. "It's providing low-cost VoIP services very reliably, and its compatibility with Asterisk is changing the possibilities in exciting and flexible ways. Shapiro is an experienced entrepreneur, and we've been pleasantly surprised with the company's performance."

Boulais said Ifbyphone's customer retention and conversion rates were high, and the company was well suited in challenging economic times, because of good testing methods and low barriers of adoption by customers due to an aggressive pricing scheme.

Another interesting thing to note is that IfByPhone is based in Chicago so this amount of $4.6 million of funding will do more for this company than in could do for a Silicon Valley based startup - in fact, experts evaluate this amount as equal to $6.5-$7 million raised in the Valley due to a considerable difference between rent, salaries and other costs that are often higher in California