on 03 November 2008, 12:25
by Ken Schachter

Dash Navigation, backed by Sequoia Capital and Kleiner Perkins Caufield & Byers, is laying off 55 of its 85 workers and exiting the hardware business in favor of a licensing strategy, the GPS device maker said Monday.

Dash devices provide not only mapping information but also live traffic data via Microsoft spinoff Inrix and the network of Dash users whose units contribute via Wi-Fi or cellular connections to a network of live traffic feeds.

Company spokeswoman Gina Bender said Dash, which received $30 million in February in the latest round of its total $71 million venture funding, has adequate capital to pursue its new direction. In recent months, the Sunnyvale, California, company has initiated talks to license its system, she said, and has heard from consumers seeking Dash capabilities on their mobile phones.

Facing much bigger rivals in Garmin, TomTom, and others, Dash devices never found strong retail channels beyond Amazon.com and a couple other outlets.

In 2007, ABI Research forecast that by 2012, more than 60 percent of all navigation devices would include real-time, two-way connectivity. Though Dash pioneered the idea of two-way connectivity, competitors have added traffic feeds to their devices without requiring users to pay subscription fees. Garmin’s Nuvi 755T model includes third-party traffic data that is subsidized by advertising.

Ms. Bender said Dash cut jobs related to retail sales, advertising, and hardware.

The company’s backers also include Skymoon Ventures, Crescendo Ventures, Artis Capital, and ZenShin Capital Partners.