VentureBeat

Funambol has raised $12.5 million in venture funding to fuel its open-source mobile messaging software business. On top of that, the company is announcing today that it’s landed AOL as a customer for its mobile synchronization software.

Funambol raised its second round from Nexit Ventures (which led), Castile Ventures, Walden International, and HIG Ventures. The new financing brings the total raised by the company to $25 million. The new funds will help the company expand in Europe and Asia.

Fabrizio Capobianco, CEO of the Redwood City, Calif.-based company, said Funambol’s software has been downloaded more than two million times, making it the top open-source mobile software. Mobile phone carriers put the “push email” software on their phones to create a free Blackberry-style functionality. With the software on a phone, users can have their corporate email forwarded to them on the go. That function has previously been the domain of high-end smart phones.

“We make email accessible on the 98 percent of phones that don’t have email capabilities,” Capobianco said.

However, there are plenty of other companies offering similar email capabilities, including Flurry.

He said that the company makes its money through its carrier edition, which can scale to millions of users.

Capobianco said the AOL deal would help AOL synchronize AOL’s online PC and mobile mail services. In addition, AOL recently selected Funambol to help synchronize its online and mobile mail services using Funambol’s open source software and its scalable synchronization platform.

The company’s name comes from the Italian word for tight rope walker. The company has 75 employees and most of its development team is in Italy. With the new funding, Nexit partner Michel Wendell joins Funambol’s board of directors, and Castile general partner Carl Stjernfeldt joins the board as an observer.

The web and mobile phones are getting hitched. That’s evident in a deal being announced today between start-ups Funambol and Laszlo Systems.

Funambol, based in Redwood City, Calif., makes mobile messaging software based on open source software. The messaging software has contact synchronization software and push email features. Laszlo Systems, meanwhile, makes a web-based communications suite that includes email, contacts, and calendar. Laszlo is based in San Mateo, Calif.

Now the two companies are integrating their products so that users can access the same email and other data from the web or mobile phones.  Cell phone carriers can thus have a new option for integrating communications software into their phones, beyond mobile offerings from Google, Yahoo, AOL and Hotmail. Both Funambol and Laszlo say their offering is competitive with suites of those vendors.

The companies say that carriers can offer the integrated products to users for free and generate ad revenue as a result. Funambol says its software is available to 1.5 billion mobile phone users, though it doesn’t say how many users it has. The integrated software is available at either company’s web site.

In March, Laszlo raised $6. 6 million in a third round of funding from existing investors including: WI Harper Group, General Catalyst Partners, Sofinnova Ventures, Mitsui & Co. Venture Partners, and other private investors. Funambol raised money in 2007 and its investors include Walden International, HIG Ventures, and The Golden Mouse.