The shift to the consumer-driven economy is a key theme for ScaleVP and has created a fertile environment to build great companies. ScaleVP believes changes in media consumption, mobility, and supply chain economics have created strong opportunities for startup companies to generate significant growth and sustainable profits.

Structural changes in consumer electronics have also created attractive opportunities for startup component companies. A combination of low cost Asian manufacturing and fabless device manufacturing have created a dynamic, and horizontal business environment where the best solutions can realize fast traction. At the most basic hardware level, the challenges of power management have driven fast growing differentiated companies.

The tremendous growth of the cell phone handset market has enabled the distribution of new products and services directly to consumers. Products such as downloadable games, ring tones, email services, and SMS have been driven directly by consumers as they utilize the cell phone for new applications.

In broadband consumer Internet access, ScaleVP's insights into content and advertising are driving a number of new investments. ScaleVP has identified website traffic management and marketing services as particularly attractive opportunities for fast growth and sustainable profitability.

The shift to a consumer-driven economy has driven ScaleVP investments over the years in Glu Mobile, mBlox, Monolithic Power Systems and Waterfront Media.

Glu Mobile
As full-featured handsets became mainstream in 2005, ScaleVP recognized the opportunity for this new gaming platform and invested in Glu Mobile. As part of this initial investment, the firm urged the Company to focus on market share leadership as the industry dynamics would eventually favor only significant suppliers. Although Glu Mobile was behind in market share at the time of the investment, the management team grew the Company to be the largest independent mobile game publisher and second in overall worldwide market share. ScaleVP aided in the due diligence for acquisitions, recruited senior executives and board members, including the CFO, and helped guide the company in strategy, particularly casual games, web-mobile convergence and advertising business models. Glu Mobile went public in 2007, and continues to prosper.

mBlox
ScaleVP saw the phenomenal growth of short messaging service (SMS) usage overseas and knew that service would soon sweep the U.S. Carriers can only allow a few direct billing connections, creating an opportunity for mBlox to dominate the backend inter-carrier aggregation market. With its investment from ScaleVP and our direct hands-on involvement in the customer acquisition strategy, product offerings and acquisitions, and operations, mBlox has grown into the market leader in inter-carrier billing for consumer driven content purchases and SMS messaging for marketing and information services. As the overall use of mobile phones for entertainment and payment expands, mBlox continues to see tremendous growth. In 2007, ScaleVP combined its expertise in mobile games and payments, and invested in PlayPhone, a leader in downloadable mobile content.

Monolithic Power Systems
ScaleVP identified a fundamental need in consumer electronics was more efficient power management, to enable longer battery life, lower cost, and differentiated product design. ScaleVP uncovered Monolithic Power Systems as a company prepared to ramp its sales into the broader consumer electronics market and was the first and only US venture investor in the company. With ScaleVP's help in channel development, company infrastructure, and product strategy, MPS was able to grow very rapidly to a successful IPO in 2004 (NASDAQ: MPWR). Since that time, MPS has continued to grow into one of the largest and fastest growing analog power management companies in the world. New opportunities in power management continue to emerge and ScaleVP's investment and expertise now empowers growth at Enpirion.

Waterfront Media
In consumer web media, ScaleVP identified the high growth and high value of online health information. Consumers are becoming more involved in their healthcare decisions as pharmaceutical companies push information to them, and doctors have less time to spend with individual patients, resulting in an enormous amount of consumer traffic seeking authoritative health information on the web. ScaleVP uncovered and invested in Waterfront Media, the largest privately held web health media company, to take advantage of this growth. Waterfront's ability to attract highly motivated consumers to its websites has driven advertisers to pay high advertising rates to reach them. ScaleVP is helping Waterfront continue to gain market share by identifying and negotiating with acquisition candidates, and preparing Waterfront for an IPO that will accelerate its growth.