Unlockd goes into voluntary administration amid Google battle

Local mobile advertising start-up Unlockd is the latest local tech outfit to hit trouble, announcing it has entered administration.

Unlockd CEO Matt Berriman. Source: Supplied.

Australian mobile advertising start-up Unlockd has gone into voluntary administration, making it the latest high-profile local technology outfit to run into turbulence

Unlockd, which delivers targeted advertising to users when they unlock their smartphones, has been locked in a do or die legal struggle with Google since April, which forced the company to shelve its planned IPO.

Google threatened to pull the plug on Unlockd’s app on its Google Play store and disable advertising content from its AdMob marketplace on the start-up’s apps. The threat forced the company to put its IPO on ice and a cash-starved Unlockd has now had to call in McGrath Nicol as administrators, despite winning court injunctions against Google last month.

“We have since received significant judgments from both the English High Court and the Federal Court of Australia granting Unlockd interim injunctions to prevent Google from disabling AdMob-generated advertising content and removing Unlockd apps from the Google Play Store in the UK, Europe and Australia,” the company said on Tuesday.

“This was recognition by the Courts that there is a serious issue to be tried.”

“Despite this, the ramifications of Google’s actions have had and continue to have a deep impact on the business when considering the valuation of Unlockd prior to these threats and the postponement of the planned IPO, which would have fuelled the continued growth and expansion of the business.”

“As such, we have not been able to secure the capital we had expected to replace the IPO and therefore have been left no choice but to move into voluntary administration,” it added.

The start-up — founded in 2014 by Matt Berriman, former chief financial officer Craig Watt and senior Herald & Weekly Times executive Chris Kerrisk — currently has over 330,000 monthly active users worldwide and has deals in place with Sprint Telecom subsidiary Boost Mobile in the US, Britain’s Tesco Mobile and Irish billionaire Denis O’Brien’s Jamaica-based operator Digicel.

Unlockd’s senior management and board, which includes former Telstra boss Sol Trujillo, is now working with the administrators to find a buyer for the company or alternative investment options.

The Australian understands that Unlockd will continue with its legal proceedings against Google, even as its administrators look to find a new path forward for the business. It may also pursue the tech giant for damages as the legal tussle continues.

The start-up maintains that Google’s decision to escalate their objections on the cusp of the IPO, expected to net as much as $80 million, was the primary reason for the company’s predicament.

Meanwhile, Google insists that Unlockd’s app remans in clear violation of its policies.

“Our publicly available AdMob and Google Play policies clearly set out how our products may be used, and are designed to protect the interests of advertisers, publishers and phone users,” a Google spokesman told The Australian in May.

“We explained our concerns to Unlockd, outlined how they could fix the problems or use alternatives, and gave them time to make changes and despite having agreed at the outset to comply with our product policies, their app remains in infringement today.”

Unlockd is backed by some of the biggest names in Australian business, including Lachlan Murdoch, former Seven Group chief executive Peter Gammell and Catch of The Day co-founders Hezi and Gabby Leibovich.

News Corp is publisher of The Australian.