Khosla Ventures invests $5M in Jawbone

jawbone_silver.jpgBluetooth saved your butt, I joked with Hosain Rahman, CEO and founder of Aliph, a San Francisco-based company which makes the Jawbone line of headsets for mobile phones and computers with amazing noise cancellation abilities, and has just raised over $5 million in funding from Khosla Ventures, a Menlo Park-based VC firm started by Sun Microsystems co-founder, Vinod Khosla.

Jawbone has been an impressive product, but its early critical acclaim never translated into commercial success. Till recently, when the company released its first bluetooth headset, which even at a steep sticker price of $120, is flying off the shelves. The device uses bluetooth chipset from Cambridge Silicon Radio and marries it to its own proprietary noise cancellation technology, which allows almost clear conversations while walking down the busiest of streets.
Technology aside, the bluetooth version of Jawbone got a big push when AT&T decided to sell the device in its wireless stores. Since then Apple and Best Buy have started to stock the headset in their stores. It has been such a hit that Rahman had to go looking for fresh funding. With this round of founding, the company has raised a total of $14 million in its eight-year existence. “This is one of the most exciting companies we have invested in,” says David Weiden, partner with Khosla Ventures. Rahman started the company in 1999, with an idea to license the technology to others, but later changed strategy to making consumer devices.
In a chat this morning, Rahman told us that Aliph is now on track to being profitable, have sold well over 100,000 units. Given how many people I have seen walking around, yakking on the street wearing Jawbone, it seems the number has to be much higher. The Blackberry crowd particularly loves this headset.
This has to be particularly gratifying for Rahman, who is persistent if nothing else. He has been pitching me to write about his company forever, and I kept pushing him away, always telling him, your products (wired ones) are good, just not great. And he kept coming back, with yet another product. The newest Jawbone, however is worth writing about. From packaging to bluetooth pairing, the whole process is something you would expect from Apple, not a little start-up.
Now the trick for Rahman is to take this one-hit wonder and turn it into a stable of successful products. If he doesn’t, then rivals that include everyone from Plantronics, Nokia, and Motorola are lurking, ready to swoop in and steal his lunch.
Question: Do you Jawbone? If not, then what is your favorite headset and why?
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* Open Thread: What Bluetooth Headsets Do You Use?