InternetNews.com has an interesting interview with John Malloy, managing general partner with BlueRun Ventures (formerly known as Nokai Venture Partners). In particular, he talks about the firm's decision to invest in SunRocket's latest round at a time when Vonage continues to grow and new competition is entering the VOIP market. In explaining BlueRun's decision, he talks about how SunRocket's executive team comes from MCI, which means they are consumer marketers. "Now that the technology is ready, it's all about value to the end-user. It's alternative phone service. Are they competing with Vonage directly? The answer is they are not competing directly with Vonage. They are competing with Verizon and others [regional and long-distance carriers]," he said. While SunRocket is yet another service provider looking for a market foothold, Malloy makes an important point that appears lost on many people. VOIP needs to escape its roots as a cool technology. It needs to mature and take on the identity of a leading-edge service with compelling features at an attractive price.
Picking up another theme I've been running hard on, Malloy said he believes there will be VOIP IPOs this year because "Wall Street will reward them and the financial metrics will be there. If Vonage was a public company, it would have a significant market cap, and [potential buyers] are dealing with diminishing revenues". To date, I have been puzzled by the lack of IPOs. This inertia can't lie with investment bankers on Wall St., who are always looking to sell the next deal. Perhaps VOIP executives learned their lessons from the dot-com days, or maybe everyone is waiting for Vonage to open the gates.