TEN MILLION DOLLARS.

TEN MILLION DOLLARS.

TEN MILLION DOLLARS.

Just think about it. It’s there, sitting for you to spend however you want.  Your charter: try to earn about 10-20x on your investment.  Here’s the plan: give it to a company enabling e-coupons on cell phones.  Doesn’t sound bad, right?  Not at all.  But why that much?  Well, they are popular in their beta testing.  Oh, sounds even better.  Did they test with the masses, you know, get some predictable results?  Well, they tried it in California, and that’s pretty representative of the rest of the country, right?

I have fond memories of Kozmo doing really really well in San Francisco, and then expanding, logically, to Houston and Baltimore and other tech meccas.  Their press release and stats are all full of holes and convenient under-reporting on usage trends.  I file the whole “it’s only sub-1% without us, and we bring 20% conversion to the table” type of argument as extremely weak.  Didn’t anyone’s parent’s teach them about things that sound too good to be true??

Maybe they should add on a few more features into the system, or team up with ZiXXo (but then again, I think ZiXXo could probably just enable this feature on their own).  I just don’t understand how CellFire is an entire company (or even two for that matter!)?  Sure, more coupons in more places that are easier to redeem is fairly straightforward.  But who did the math that says this is a multi-hundred-million-dollar play worthy of the $10 million round??

At least it’s less than $87 billion dollars…

ps - if you are wondering why there is no CellFire logo visible it’s because their Web site has it hidden inside their style sheet, and I refuse to take the time to make my own version of it or scrounge through their CSS files to find the source.