Vonage files IPO: and I have their description of strategy going forward

 As widely anticipated, Vonage filed an Initial Public Offering today. The company appointed Mike Snyder as CEO.



As widely anticipated, Vonage filed an Initial Public Offering today.

The company appointed Mike Snyder as CEO. Founder Jeff Citron remains as chairman.

Vonage says it hopes to raise some $250 million from the sale of its shares.

Since we do VoIP here rather than concentrate on financial matters, I thought you readers would be most interested in what Vonage says it will do with the money raised from the sale of its stock.

For this insight, let me turn to Vonage itself.

Most times when a company announces it is going public, it has to file a detailed report with the Securities and Exchange Commission. This report usually contains an "Our Strategy," or similarly named, section.

Here's the Vonage filing's "Our Strategy" section, with details on what they see as their next steps: 

Our Strategy

We believe that our strong brand identity and reputation for quality communications services are instrumental to building our customer base. Our corebusiness strategy is to enhance our brand image and the quality of our services in order to attract new customers. As we build on our leading brand andabove−mentioned strengths, we are pursuing the following additional business strategies:

Develop Additional Innovative Features and Products. We believe our technology, product innovation and strategic relationships have helped us achieve our leadership position in broadband telephone services. Our product development team works to improve our technology platform and develop additional features that we believe will be valued by our customers.

Our relationship with Texas Instruments, for example, has resulted in the development of a Vonage−certified reference design and related chipsets that can be incorporated into telephone and networking devices, such as VTech cordless telephones and Linksys wireless routers, allowing purchasers of these devices to subscribe to Vonage services without obtaining additional hardware.

To help maintain our leadership position, we intend to further develop our relationships with leading semiconductor chip and consumer device manufacturers to ensure that our customers can access our services using a wide variety of attractive equipment alternatives in the future.

Vonage says it will use part of the money by expanding its distribution in retail.


Expand Distribution Capabilities. We seek to further expand our distribution capabilities to achieve greater adoption among mainstream consumers. We plan to advertise and offer a wider variety of attractive equipment alternatives to further drive mainstream adoption of our service through both our direct and retail channels. Additionally, we intend to grow our existing relationships and develop new relationships with major retailers in order to enhance and reinforce the Vonage brand in mainstream consumers' minds and reach them in a familiar sales  environment. For example, we have expanded the number of third−party field personnel who visit thousands of stores every month on our behalf to promote Vonage product knowledge, check on product placement and availability, and drive in−store sales efforts.


Vonage says it also envisions the need and capability to improve its customer service: 

Continue to Improve the Customer Experience. As we expand our business, we will continue to focus on maintaining a positive customer experience. We will further enhance our automated online account management system, which already allows our customers to monitortheir call activity, listen to voicemails, add lines, change features and plans, check their bills and make customer referrals online. To provide customers with additional assistance, we also are focused on improving our live customer care. For example, we upgraded the technologyused by our  24−hour−a−day, seven−day−a−week customer care center in New Jersey in March 2005, resulting in reduced wait times and the capacity to handle more customer care calls. We will also continue to enhance our live customer care through the strategic use of outsourcing, such as for device installation support.

Not surprisingly, Vonage's filing also envisions geographical expansion. I have heard that Australia is next, but the filing does not provide specifics as much as it cited general expansion goals:

Expand into New Geographic Markets. Our potential market is the worldwide broadband customer base. We evaluate new markets based on the number of broadband customers, competitive landscape and regulatory environment. We already have launched services in theUnited States, Canada and the United Kingdom and intend to take advantage of our scaleable technology platform to selectively expand into additional international markets, subject to regulatory and other considerations.

Well, there you have a view of the future from a company who is about to go public, and intends to raise some $250 million in the process.