Yuilop, a European free messaging startup which launched back in 2011 and has amassed “millions” of users of its apps, will be launching in the U.S. in the next couple of weeks. Speaking to TechCrunch at the Mobile World Congress tradeshow in Barcelona today co-founder and CEO, Jochen Doppelhammer, said that although Yuilop does have some users in the U.S. already, who have managed to acquire its app on the sly by downloading it when they’re traveling or via other workarounds, it will be officially opening up to the U.S. in “one to two weeks” (with both an Android and iOS app).
So what’s so special about (yet) another free messaging service? Yuilop has taken a different approach to what Doppelhammer describes as “silos” like Whatsapp, Line and Viber — which require the person with whom you want to speak to also have the app. “We have built the whole architecture on open standards,” he says. “We’re combining the open standard xmpp, which allows us to connect to federated OTT services like Google Talk, and the mobile number (MSISDN), which allows us to interconnect with the mobile telecom world via SMS and phone calls.”
What this means in practice is that Yuilop users can call and message non-Yuilop users and — unlike Skype which charges users when they ‘Skype out’ — it’s still free. Yuilop does use a virtual currency model for when users are talking to non-Yuilop users (it calls this currency ‘energy‘), so there is a ‘virtual cost’ to these calls/messages. But energy can be earned without paying any hard cash — through a variety of actions such as referring a friend to Yuilop, talking with another Yuilop user, using the app, or engaging with promotions such as sponsored content/adverts.
While making Yuilop-to-non-Yuilop calls costs energy, receiving calls earns energy so if you take it in turns to call your friend your energy level will remain the same. “As long as you keep communicating it stays balanced,” says Doppelhammer.
In addition to free calls, SMS, real-time multimedia chatting, Yuilop plans to add video chatting in future, and will probably also branch out into adding some more quirky stuff that its rivals offer like stickers. That stuff is not a huge priority for Doppelhammer though. “Our main differentiator is free phone calls to anybody and all the rest: texting, real-time multimedia chatting,” he says. He would also like to add a free data component to the offering at some point — albeit data is likely to come with more strings attached than the free calls and texts.
Yuilop is currently active in more than 40 countries, and has consciously been taking things slowly as it scales up, rather than diving straight into big markets like the U.S., China and India (where it doesn’t yet operate). Its three biggest markets are currently Germany, Italy and Spain, according to Doppelhammer, but he says the service is also popular in Latin American — especially Mexico — and has also launched in other markets such as Russia and Turkey.
Its business model is focused around advertising and other promotional components like voucher redemption, but Yuilop was also at MWC to launch a white label, out-of-the-box OTT SaaS product which carriers and developers can pay to license to add free calling into their service. Doppelhammer said it had lots of interest in the offering, including from MVNOs — a group he argues is in keen need of some new tricks, caught between carriers at the top and OTT players squeezing from below. Smaller carriers and MVNOs could take Yuilop’s white label product and add their own branding to offer their own free calling and messaging service as a differentiator, he says.
Another revenue stream for Yuilop is likely to be freemium offerings, such as letting users pay money to buy energy, and also premium services, such as letting users pay money to have more than one number. “In general we give people a number from their country but as a premium service… you can also get a number from another country [so friends from that country could call you at the local rate]. So we’re going to offer premium services like this one,” says Doppelhammer.
As well as Android and iOS apps, Yuilop has already created a Firefox OS version. Other platforms currently supported include BlackBerry 7 OS (but not BlackBerry 10) and Windows Phone (in beta). It will also be launching a browser-based version “within a few weeks”, says Doppelhammer. Of course, there is no shortage of over the top messaging startups but despite sitting in such a crowded space, Doppelhammer’s ambition is “to be Skype” — or rather, to be as big as Skype but more open.
The company has raised close to $10 million dollars in funding today. It has raised $7.12 million, according to CrunchBase, but Doppelhammer said it also recently received a loan from the Spanish government of €1.5 million ($1.96 million) so it’s not currently looking to raise a new round. Yuilop’s other investors include Nauta Capital, Shortcut Ventures GmbH and Bright Capital.