Skype Founder’s New Startup, FreedomPop, Picks CEO

FreedomPop Inc., the wireless Internet startup backed by Skype co-founder Niklas Zennstrom, named Stephen Stokols its chief executive officer as it prepares to offer limited access for free to iPhones and other devices.

Stokols, 37, was CEO of Woo Media Inc., a video-chat and entertainment startup backed by Zennstrom that was sold in November. Before then, Stokols worked as a vice president of strategy and product development at BT Group Plc (BT/A) and as e- commerce director for Qwest Communications International Inc.

FreedomPop, based in Los Angeles, will have wireless service for laptops and smartphones ready in the next four to eight weeks, Stokols said. The company will initially offer as much as 1 gigabyte of free wireless Internet access per month to 30,000 to 50,000 users in the U.S., and could expand to 100,000 users within 90 days, he said.

“We are doing something that’s extremely disruptive and potentially massive,” Stokols said in an Aug. 14 phone interview. “We’ve got a lot of pent-up demand.”

FreedomPop will make money by charging for additional use and for extra services the company could sell to clients over their Internet connections, he said.

The wireless provider will first offer its service through its website, where customers will be able to order a USB dongle or a Wi-Fi hotspot device called Freedom Spot Photon to get online, first via Clearwire Corp. (CLWR) and later through Sprint Nextel Corp. (S)’s fourth-generation, or 4G, wireless network. Later, FreedomPop will sell cases for Apple Inc. (AAPL)’s iPhone and iPod that provide Web access.

Case Orders

Early next year, the company will start selling its devices through a major online retailer and a large physical retailer, Stokols said. FreedomPop has already received pre-orders for “tens of thousands” of the cases, he said.

FreedomPop, which has about 40 employees, has raised $7.5 million from venture capitalists including Zennstrom, Stokols said. It’s in the process of raising a “few million” dollars in debt, he said. The company is also in talks to raise $15 million to $20 million more in venture funding, expected to close later this year or in early 2013, he said.

Zennstrom co-founded Web-calling provider Skype with Janus Friis and sold the company in 2005 to online auctions provider EBay Inc. (EBAY) for an eventual $3.1 billion. Later, a consortium that included Zennstrom bought Skype back, and sold to Microsoft Corp. (MSFT) in 2011 for $8.5 billion cash. Zennstrom also co-founded other startups, including Kazaa, Joltid and Joost. He serves on the boards of companies including mobile games maker Rovio Entertainment Oy.

Woo Media, Stokols’s previous company, had 10 million users, Stokols said. It raised $19 million in venture capital before Zoosk Inc. bought the company for an undisclosed price.

Stokols holds a master’s degree in business administration from the University of California, Berkeley, and a master’s degree in finance from the London Business School.

To contact the reporter on this story: Olga Kharif in Portland at okharif@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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