Wikipedia founder Jimmy Wales' mobile network The People’s Operator sees revenues rise but US expansion eats into profit

Madeline Ratcliffe
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Wales launched the company to "inspire discussion at a local level" (Source: Getty)

Wikipedia founder Jimmy Wales' latest venture, mobile phone provider The People's Operator (TPO), announced its maiden results yesterday and revenues of £603,000.

The figures

Revenue grew 358 per cent in the six moths to 30 June, from £132,000 in the first half of 2014.

The company's losses actually increased from £600,000 last year to £4.4m in the first half of 2015, with a cash balance of £12.9m.

UK subscribers increased to 50,360- a 43 per cent in crease since the half-year period ended.

It cost the company an average of £8 to acquire a customer, below the industry average, but the average revenue, per pay-monthly customer is £13.63, dropping to £10.89 for pay-as-you-go users.

Why it's interesting

The phone operator, which is in partnership with Sprint in the US and EE in the UK, spends nothing on advertising, with no physical shops, just relying on word-of-mouth and social media, which means 10 per cent of customers' bills are directed to the charities of their choice, including UNHCR and Save the Children.

Wales has also launched a social media platform, TPO Community, which offers users the chance to promote and donate to charities close to their heart; so far 84 organisations have signed up, among them Water Aid UK and the WWF.

The network has a "followers" model similar to Twitter, and is “a discussion based donation platform.”

Wales said there was a growing trend for altruistic businesses “and we're jumping on this trend”. He cited Toms, the shoe maker which donates a pair of shoes in Africa for every pair sold, as an example of the business model that does good.

The fundamental premise is that “instead of spending money on advertising costs, from the Superbowl, to leaflets and flyers and store-fronts, we spend money on a charity of your choice, redirecting marketing funds to do good”.

What the company said

Mark Epstein, chief executive, said:

A loss is to be expected given the major investment costs: we launched three major products on the same day in the US market (on 21 July). But we're on track, and passed a major milestone of over 50,000 subscribers. We're very pleased with how we've been received in the UK, and are on track to reach our target of 69,000 by the end of the year.

Chairman Jimmy Wales told City A.M. the company was looking to “inspire discussion at a local level” and hoping to broaden its 30 current charity partners, to “reach smaller causes.”

“We had a vision of people with the ability to communicate about things they love online. It's taking advantage of the power of story-telling.”

In short

Can you make a profit and "do good"? It might be too early to say whether the pull of the Wikipedia founder is enough for TPO.

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