Will Jaxtr upstage Skype?

Jaxtr has raised a $10 million Series A round led by August Capital with Mayfield Fund, Draper Richards, Draper Fisher Jurvetson and Luxemburg-based Mangrove Capital participating. Jaxtr’s registered user base has been doubling every month since its March launch. Most recently, it jumped from 500,000 to 1 million in just 27 days. So, it’s no surprise that Jaxtr needs more money to continue its expansion.

The interesting thing is that three of the investors, Draper Richards, Draper Fisher Jurvetson and Luxemburg-based Mangrove Capital, were early investors in Skype. Overall, there’s a lot of venture capital flowing into voice startups. Rebtel grabbed $20 million, Truphone collected $23.4 million, Jajah hauled $20 million, and last month newcomer Ooma topped the list with $27 million.

Why would the same folks invest in Jaxtr? Does Jaxtr have a better future than Skype? The investments indicate that Venture Capitalists, who have insight into these companies and know the market, feel that the voice market is still up for grabs. Perhaps they feel that Skype can be beaten at its game, especially since Skype is not a great solution for mobile phones and seems to be losing its way at EBay.

Here’s the thing. In the voice world, the mobile phone is king, primarily because of the anywhere, anytime convenience of mobile service. Whoever makes voice easy to use (and cheap-er) on mobile phones will be king.

It’s clear that Skype is not this king. Skype has made little progress with being on mobile devices because Skype requires a special client and it is very difficult to facilitate mobile clients. For one, users don’t know how to and cannot be bothered to download and install a client on their mobile device. Second, a lot of wireless phones are pretty much closed to unsanctioned 3rd party applications. More reasons can be found at 4 Reasons You Won’t Have Skype On Cell Phones Anytime Soon.

On the other hand, Jaxtr gives users a unique phone number and web address, so a mobile user can make and receive calls without any special software on a cellular phone, like Skype, or without having to access a web browser, like Jajah. The numbers show this too – Apparently, between 70 and 80 % Jaxtr calls involve a mobile phone.

Jaxtr will incorporate advertising into its services and may also pursue new services on social networks. Longer term, Jaxtr plans tiered monthly minute plans like that kind available today with cell phones. Jaxtr also plans advertising within user accounts. Jaxtr hopes to get 20 million users in the next twelve months and expects around one percent to purchase for additional minutes.

This indicates that Jaxtr has an uptapped market that Skype cannot easily reach. Especially with EBay fumbling with the Skype acquisition (EBay’s acquisition of Skype never made much sense to me). My bet is that Jaxtr will give Skype a run for its money!

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