Nikhil adds: Well, it looks like survival capital, and $12 million is significantly higher than their previous rounds of funding. The way this business works is that it has a problem of plenty. As we've explained before, the greater the increase in user base, the higher the cost for the company. We wonder how much their "advertising fill rate" (number of SMS' with ads), and what kind of an advertising fill rate they'll require to cover their costs. Both SMS GupShup and MyToday are important businesses to watch in India - they're both very large scale attempts at running direct to consumer businesses without telecom operator billing. What do you think - will direct to consumer businesses work in India? Earlier: Push-SMS based mobile networking community SMS GupShup has closed a $12 million funding round led by Boston, USA based Globespan Capital Partners, which has backed the likes of Virtusa, Quattro Wireless and Linden Labs, the makers of the online virtual world for social networking Second Life. Existing investors Charles River Ventures and Helion Venture Partners who invested $11 million in SMSGupshup in July 2008 have also participated in this round. The company has raised $37 million in funding so far - in the second round, the company had raised $7.5 million from Cambrian Fund, Lloyd George Asian Plus Fund and HTSG. The company is not yet profitable. Funds To Go Into Expansion & Growing Enterprise Biz SMSGupshup began in April 2007 and claims it now serves 26 million users.…
