Reading between the lines: Amp’d lacked focus

As we give you mobile industry updates throughout the day, we’re usually focused on the news. Sure, we throw our two cents around, but it’s normally not the focus of the post. We’re going to try something different this time around, as we recently stumbled across an interview with Peter Adderton, former CEO of Amp’d Mobile. This comes from the folks at mocoNews who, as they say, are unhealthily obsessed with mobile content. You’d expect we’d be best friends by now.

The basic gist of the interview is that Amp’d had no clear direction. Yes, they wanted to become a pioneer mobile media company, but it appears that management wasn’t on the same page regarding the means to that end. Given the turn of events that began just two months ago, that doesn’t surprise us at all.

We’ll share a few choice quotes, just to illustrate what we’re saying.

“You don’t raise $400 million in 18 months by spending time inside the office. Trying to ambiguously raise that amount of money, while at the same time trying to create something new and different was a challenge that caught up with us in time.”

Well, not if you had a solid plan in place. It appears that most of Amp’d’s board was focused on raising the $400 million. There’s nothing wrong with that, but they also need people focusing on how to create the service. Of course, that takes more man power. So maybe now you’re trying to raise $500 million, but you have more people on task. We’re not trying to say it’s easy to raise $500 million, but if that’s what your business requires and you are passionate about your business, you’ll get it done.

“The thing that took us longer than expected was the technical side of it: there was no one outside of ourselves to go look at. A lot of things we had to go out and create…that took extra time and extra capital for the company.”

So it seems that maybe $400 million was undershooting it. So if Amp’d was running on insufficient funds, we can totally see where they’d lose focus and start to worry about things like “how are we going to pay for this?”.

“The biggest struggle I had [with the board] was agreement on where the company should go. We had way too many board members and then we had observers at top, and the any partner could dial in, to a point where it became very difficult for the management to manage.”

What’s that cliche about too many cooks in the kitchen? Yes, this service could use many innovative minds, since it was a very fresh idea. However, when you put that many egos in a room, it tends to get a bit stuffy.

In the end, though, billing really killed the company:

Billing and collection: What we initially built the system it worked fine, but when Bill [Stone] and Sue [Swenson] came in and saw that we needed to change it to scale. It takes months to change a billing vendor and we had a team working on that, while at the same time we were loading on the customers at a great rate. In 17 weeks, we got 100K subscribers, and little problems in billing and collections suddenly became bigger problems. It wasn’t just customers with bad customers, but it was customers with high credit who just weren’t being billed at all.

At least in this regard, Amp’d was the victim of bad timing. They were just overhauling their billing system to handle a higher volume of customers when the swarm came. If you’re adding 100,000 subscribers while trying to upgrade your system, there are bound to be oversights. That’s how you have such an extraordinary number of subscribers not paying their bills — not because they don’t want to pay them, but because they’re not receiving a bill at all.

How we interpret all this: Amp’d had too many people with their hands in the business, and too few with their hands on the business. They made a goal of raising $400 million when they might have needed $800 million. But because funding is so difficult to obtain, they had to settle for the absolute minimum. That, combined with some bad timing, doomed the company.
[mocoNews]