Investors no longer view carrier billing as a niche product, and are providing the means to push the concept into new geographic markets.

Among the beneficiaries of this trend is Boku, a company that provides carrier billing services to customers of Google, Microsoft, Sony, Spotify and Facebook, among others. Customer of those companies use Boku's service to have their digital content purchases appear on their monthly mobile phone bills.

"Early on we saw an opportunity with Boku to provide a digital payment solution for the hundreds of millions of people who don't have access to bank cards or credit cards," said David Weiden, a partner at Khosla Ventures, a Menlo Park, Calif.-based venture capital company that's participating in a new $13.7 million investment in the San Francisco-based Boku.

The seven-year-old company has raised a total of $91 million, with other investors including Benchmark Capital, NEA, Index Ventures and DAG Ventures. Khosla's other financial investments include Affirm, Stripe and PayNearMe.  

"Early on…the mobile coverage could be inconsistent, so this type of payments was limited in terms of addressable market. Only certain markets could adopt carrier billing," said Adam Lee, chief product officer Boku, adding the broader availability has improved. "The investment is a vote of confidence for us, and it's also a vote of confidence for the carrier billing industry. It can be hard to introduce a new payment method."

Merchants in developed countries are warming to the idea of carrier billing, which initially was considered a way to offer financial services in developing countries without established bank card networks, Lee said. The growth of mobile sharing businesses such as Uber and Airbnb create an added use case for carrier billing.

"Carrier billing has now moved beyond [emerging markets] to become the preferred alternative payment method for many of the world's largest merchants," Weiden said.

The latest infusion is a relatively small investment, but is targeted—the cash is designed to help Boku compete for merchants in developed markets. Boku's total investment is about $91 million since its founding in 2009. Japan-based GMO Payment Gateway is also participating in the new investment round, providing capital for further geographic expansion.

Boku has also recently added new European markets, and is seeking to diversify its international reach. The company is currently active in about 60 countries.

"Boku continues to grow in emerging economies, while simultaneously executing a strategy to penetrate and grow in developed markets," Weiden said.

Other carrier billing companies include Danal, which has partnered with SCVNGR's LevelUp to offer carrier billing in physical stores. Samsung has also offered carrier billing for app store purchases.

Carrier billing companies face the same challenges in developed markets as any provider of new payment technology, according to Sarah Grotta, director of the debit advisory service at Mercator Advisory Group.

"Customers need more than just another new payment form factor," Grotta said. "Without ubiquitous or even just 'really good' acceptance, I think they will be hard pressed to get many users excited. Other than processing savings for merchants, I am not sure what the appeal in the developed market will be, where debit and credit saturate the market."

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