WINNER - USA DEAL: Fuhu Gets $10 Mln Financing
from ORIX Ventures NAME: Jim Mitchell COMPANY: Fuhu, Inc. POSITION: CEO TEL: 310-227-8230 EMAIL:
Jim.Mitchell@fuhu.com
DEAL OVERVIEW:
In August 2012, kids’ tablet and content creator Fuhu, Inc. closed a $10 million venture debt financing deal with ORIX Ventures to continue its dominance in the children’s technology industry. ORIX Ventures, a division of Dallas-based ORIX USA Corp that provides both debt and equity financing for growing companies, has a successful track record of investing in more than 100 growth companies throughout the U.S. and Canada since 2001. The California-based Fuhu, Inc. is also backed by some of the world’s leading technology companies including Acer, Foxconn, Kingston Technology and VIA Technologies. It recently secured a $5 million investment from the leading Japanese telecom company KDDI in November.
Fuhu, Inc. CEO Jim Mitchell, who played a pivotal role in securing the deal, sits down with Financial Monthly to provide additional insight.
Q
Why did this deal make sense for Fuhu, Inc. and ORIX Ventures?
Fuhu made a significant leap in 2011 from a company with an emphasis on applications and cloud-served solutions to hardware with the introduction of our first nabi tablet. As tablet computers gained popularity, we recognized kids were a part of the movement, and they have very different needs from adults. Given our experience with kids’ content such as Fooz Kids, an application that “kiddifies” the PC, it was natural for us to offer consumers a tablet created just for kids.
ORIX Ventures recognized the incredible growth in the children’s technology vertical, and had faith Fuhu would continue dominating the kids’ tablet category beginning with the new nabi 2. They believed nabi 2 redefined how children interact with technology in ways that
were educational and entertaining. Through this deal, ORIX Ventures became a part of this exciting growing industry; and with their investment, we were able to continue creating new products and services for today’s tech-hungry, value-driven families.
Q
What are your plans following this transition?
The ORIX Ventures funding is helping us expand the nabi brand to redefine the kids’ tablet landscape that is currently filled with cheap products. On the staffing front, Fuhu has also hired new talent across all business areas to support the growth of our company.
Q
What are your thoughts and predictions within your sector in 2013 and beyond?
I believe the market for tablet computers will continue to grow, for adults and children alike, especially when we see increasing support for tablets from content providers including major Hollywood studios and cable providers.
As the children’s technology sector grows, I expect full-featured tablets will replace cartridges and disposable batteries. This will be driven by consumer demand for technology for children that is up-to-par with the products made for adults, but still expect low prices.
Tech savvy and budget conscious parents will also embrace what we call Toyccessories - products that can transform into other devices with an accessory or application. These types of products will essentially collapse the toy aisle, saving consumers money and space from multiple items in their homes. Toyccessories be a key factor in this trend, as we’ve seen now that clever applications paired with hardware can transform tablets and smartphones into almost any imaginable device.
BIO:
Jim Mitchell brings with him 18 years of experience working with global market makers in the Media, High Tech, and Electronics industries. He has worked with leading brands such as Google, HP, Sun, DirecTV, Ingram Micro, Qualcomm, Toshiba, Intel and Nokia with a focus on increasing shareholder value by opening new channels, launching new products and businesses, improving supply chain and global operations and enhancing customer care. Mr. Mitchell has held a variety of operational leadership roles accountable for global accounts, P&L and office management.
During his tenure with Accenture (formerly Andersen Consulting) Mr. Mitchell was a co-founder of the Firm’s ecommerce practice and established Internet centers throughout the country to deliver Internet based solutions to leading edge companies and the Fortune 500. In 2000 he was admitted to Partnership at Accenture and was a Managing Partner for a portfolio of electronic and high tech companies in the Western and Southwest Regions, totaling over $100M in sales and revenue per year. As the Managing Partner at the Los Angeles office location he was responsible for overseeing 700 employees as well as the business operations, including staffing plans, mentoring, motivating and retention.
Mr. Mitchell earned his B.A in Business & Computer Science from Purdue University. He holds 6 patents on ecommerce frameworks for doing business via the Internet.
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