Mobile Money Summit: Meeting with Fraaz Ahmed from Lebara

If I died yesterday I wouldn’t know about Lebara. They don’t have to do much with mobile payments — at least not at the moment — but they have an interesting business model. Those not familiar should know that Lebara is one of the most successful MVNOs in the world. This privately owned company prides itself with constant growth, and their trick is in targeting the specific market – immigrant workers in Western Europe and Australia (and that’s also the reason why I haven’t heard of them).

They provide their customers with low-cost international phone calls, and are relying on existing infrastructure which they lease from the likes of Vodafone (NYSE: VOD), KPN, Orange, and others. Then, when an international call is initiated, Lebara routes it through Internet, ensuring ridiculously cheap calls for their customers.

And since Lebara’s users are immigrant workers, they don’t utilize national media for advertising. Rather it’s local media outlets, sponsorship of concerts and other, I could say, guerrilla techniques to reach the desired audience. This sounds like a super cost effective way, and in that sense I applaud them for wisely spending their marketing budget.

Fraaz seems like a nice guy, and I can see why he’s at the Mobile Money Summit. Immigrant workers send a portion of their earnings back to their homeland. Lebara sees this as an opportunity and hopes to bundle/mix a payment service with their mobile service offering to expand beyond selling minutes and SMS, and effectively increase its ARPU. Very interesting approach, gotta admit!