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MobiHand Under “Financial Strain” & Looking to be Acquired While Devs Not Being Paid

Posted: 14 Nov 2011 02:24 AM PST

Mobihand2

Many of you may be familiar with MobiHand or some of their affiliates including our own BerryReview store. They have been facing some stiff competition from App World but it seems like they are really feeling the pain. We noticed that something has been off for the last few months especially with them moving their pay schedule to developers. Then Kyle over @BlackBerryCool heard from a large MobiHand dev, Mobile Stream, that they are owed over $150,000 by MobiHand. The dev was told by MobiHand to keep quiet because publicizing that info would mean that MobiHand would have less of a chance of paying them back. Here is exactly what Mobile Stream posted on their website:

MobiHand Inc., a Californian company, does not pay royalties for EasyTether. They owe me a huge sum of money – $163,976

Here is a detailed debt breakdown:
July royalties: $50,645.70
August royalties: $69,759.51
September royalties: $43,570.81

The guys at MobiHand admitted the debt and said they were in financial difficulties. But they refused to work out a payment schedule. They still run their business, so they obviously have some money. But that money is stolen from my EasyTether royalties.

Now MobiHand has posted on their own blog about their "Financial Strain" that they claim is caused by having to compete with large companies like RIM and App World. You can tell from their post that they are looking to be acquired so that they can get a large cash infusion. Here is what they had to say:

MobiHand was founded seven years ago by software industry veterans committed to providing responsive and cost-efficient services to developers of mobile applications.

Through that entire period of time MobiHand has maintained a nearly perfect record of supporting and paying developers on a timely basis.   With increased competition from very large, well-capitalized companies such as RIM and Google, in 2011 MobiHand has seen the need to invest heavily in developing new, differentiated services.

These new services combined with several new partnerships with large companies will result in revenue growth in the coming year.   But developing and launching these new initiatives has created significant financial strain.

As a result, MobiHand is in the process of evaluating strategic alternatives which may result in the sale of the company to a larger, more well-capitalized partner.   We expect this process to be completed before the end of this year allowing us to fulfill our obligations to all of our partners.

I am hoping that MobiHand manages to turn things around since they were pretty solid until the beginning of this year. Now they are falling behind even though they definitely have money coming in the door. I know that many of you have purchased apps through MobiHand and the BerryReview store along with many other branded stores. You might want to download and backup that information in case MobiHand is not acquired and goes under. We will keep you up to date as this develops.