Queppelin Bets On Mobile Apps For Growth; Will It Shine Among Thousands Of App Developers?

Where there are smartphones, there are apps to go with them. So it is but natural to expect an explosion in the number of app developers, all too keen to catch the fancy of millions (which may become billions soon) of smartphone users globally. Jaipur-based start-up Queppelin is one such firm trying to crack the fast-emerging market opportunities across mobile platforms like android, iOS, J2me and Windows.

The company started with its flagship product Zephyr, a mobile multimedia streaming and compression platform having content tie-ups with some of the leading rock bands in India. The app had over 26,000 downloads in the first week of launch in February 2011 and it was also showcased by Oracle Corp at the Mobile World Congress, held in Barcelona. And Queppelin's Save the Tiger mobile game, developed for Aircel, had seen more than 58,000 downloads in the first month itself. But now you can't download the Zephyr app for free as Queppelin and its business partners are all set to monetise the product. The company is tying up with different telcos so that the app will be pre-embedded in mobile handsets.

Judging by its initial popularity, it's not surprising that Queppelin has already raised two rounds of angel funding and also won the Red Herring Asia Award in October last year.

The Beginning

According to Prafulla Mathur, founder and CEO of Queppelin, the company was founded in mid-2010 with the belief that it was an inflection point in the Indian context as latest tech happenings like 3G connectivity, cheaper handsets, location-based services and even mobile payment impacted Indian consumers as never before.

Mathur also comes from a technology background that did help the start-up. He obtained an engineering degree from M.B.M. Engineering College, Jodhpur, before joining the technology department of the financial services firm Lehman Brothers. Later he worked with Halifax Bank of Scotland and finally decided to start his own venture.

Products & Biz Model

Queppelin offers various mobile products and services such as mobile audio/video streaming, m-commerce platform, social games and mobile advertising, among others. The company also develops mobile apps for its clients.

Besides Zephyr, its product portfolio includes Ek SMS (developed for India Internet Fund) which ensures instant, location-based search and deals for restaurants/bars/cafes over SMS and across Web platforms; mShoppe (a customisable m-commerce platform) and MMP, which is a QR code reader and location-checking android app developed for MakeMyPoints.

Queppelin also focuses heavily on Indian content providers like Bollywood content aggregators, media companies, regional content providers and TV reality shows. It works with content providers to build products and then help them distribute those products through pre-installation deals with handset manufacturers and distribution deals with telecom operators.

The company generates revenues primarily from licensing its technology platforms and also from developing apps for clients. When a licensing deal is done, the company receives an upfront fee and an annual licensing fee for that platform usage. It also receives a part of the revenues earned by the companies based on app usage/downloads, as is the practice in the apps industry.

Fundraising & Scaling Up

Queppelin has raised two rounds of angel funding, the first round in December 2010 and the second one in September last year. Although the names of the investors are not disclosed, Mathur has mentioned that both are from Delhi-NCR and they have invested in Queppelin in their personal capacity.

The start-up has spent nearly 50 per cent of the funding in team-building and infrastructure build-up. Although he has not shared the numbers, Mathur says that Queppelin is now cashflow positive with high revenue growth and it is not actively looking to raise more capital at this point.

The company has also grown – from a three-member team to 20 people – with an office in Gurgaon besides its headquarters in Jaipur. Queppelin is planning to open a larger facility in Gurgaon soon. This will be critical as the firm is targeting a team size of 80-100 by end of this year. And that means, it may need to go for a larger, strategic funding.

Strategy, Challenges & Future Plans

"We essentially focus on our strength in mobile app development for media, Internet, telecom, OEMs, e-commerce and mobile advertising verticals. The idea is to provide our clients with one-stop solutions involving product platforms, handset and mobile operator relationships, which will help solve the distribution issues for our clients," explains Mathur.

The company plans to enter the South-East Asian and African markets which have similar handset mix as India and similar consumer tastes. In fact, Queppelin is already in talks for prospective partnerships in these regions. It also aims to launch more products in 2012, as well as a mobile advertising platform. But that may be a tough call given the presence of existing players.

However, Mathur sees a bigger challenge in terms of acquiring talent. And that will be critical as the firm moves to the next level. Queppelin plans to hire professionals for coding & technology, graphic designing and sales & marketing.

As Queppelin develops android and iPhone apps, as well as apps for Java platform, the company can cater to all consumer segments and that will further drive its growth.

"With nearly 50 million connected handsets in India (and it's growing fast), mobile will be critical in leading the future growth in retail, content delivery, ERP and other consumer interfaces. India is expected to have more than 300 million connected mobile handsets in the next four years, primarily due to cheap data plans," says Mathur.

What is going for the company is the huge market for apps and a market that is just waiting to explode with cheap smartphones. According to some estimates, over 100 million apps are being downloaded each month in India even though just a fraction of India's mobile phone subscribers are connected to the Web. Globally, apps are already a multi-billion-dollar industry.

But it's not going to be an easy task for Queppelin. After all, there are hundreds, if not thousands, of app developers including some who specialise on churning out apps within hours! Ultimately, it might be just a fight for talent and the ability to sustain and generate innovative apps.