Free public WiFi has become one of the more popular ways that cafes, shops and other public places attract users and then use the connections to serve ads and collect other kinds of anonymised analytics. Now, a startup out of the UK called Purple WiFi has raised some funding for its own twist on the idea: letting people log in using social IDs from Facebook, Twitter, Google or Instagram (Chinese Weibo and Russian VKontakte coming soon), and then continuing the connection by pushing other messages to those users relevant to the venue.
The $5 million that forms this venture round was led by Sir Terry Leahy, the former CEO of retail giant Tesco who led it through its biggest growth phase (from a third-rate player in the UK to the third-biggest in the world) and its biggest tech developments (such as its Clubcard loyalty business and its online shopping service). Other investors include Bill Currie, Iain MacDonald and Bob Willett from the William Currie Group and Juno Capital, a leading Angel Syndicate.
This is the first outside funding for Purple WiFi, which up to now was funded by its CEO Gavin Wheeldon. Prior to Purple WiFi, Wheeldon founded and then sold in 2011 a translation startup called Applied Language Solutions to Capita, for a price of up to $92 million based on performance over four years.
Wheeldon tells me that the funding will be used for two areas: to build up the startup’s technology, and to push Purple WiFi’s business further into international markets.
Currently the product is live in some 7,500 venues across 60 countries — these range from restaurants and museums through to entire towns like York, which have built public WiFi networks — but up to now that growth has come without a huge amount of support; now there will be more dedicated teams set up to build that up, namely in markets like the U.S. as well as across the rest of the Americas, Asia and other parts of Europe.
The addition of VK.com and Weibo in China are signals of where some of that investment may go first.
Wheeldon is not under any misconceptions about how Purple WiFi is essentially playing in a very crowded market for a service that is already pretty widespread. He says that his company’s unique angles come in the form of easy logins and more ways to monetise those connections rather than simply offering users a convenient service.
“WiFi is something that is expected, for free, just as we expect access to heat, light and water,” he said in a statement. “But the big question in recent years has been how to monetise WiFi.”
That monetizing comes by way of analytics and promotions/communications with the customers.
As one example, Wheeldon described a large amusement park in Germany, which taps into the location information collected by Purple WiFi to create a promotion. “If you go there and end up waiting too long in a line for a ride, the park uses our network to send you a 50% discount for a drink after the ride. It’s our system driving that interaction.” That same location data helps venues like stores figure out where females and males congregate and for how long. That could in turn generate vouchers sent to you for products specifically in those areas.
It’s that extra layer of service that attracted the investment in this round. “Having been in the retail space for many years, I have seen how technology has and will continue to revolutionise the industry,” Sir Leahy said in a statement. He describes the startup as an “example of how additional value can be driven from an existing infrastructure.”