Alibaba Invests $50 Million in Peel to Take Remote-Control App Beyond TV

Peel co-founder and Chief Executive Thiru Arunachalam

Peel

Alibaba Group Holding Ltd. continues to expand beyond e-commerce, announcing it has plowed $50 million into a startup that turns smartphones and tablets into remote controls with an app.

Based in Mountain View, Calif., Peel Technologies Inc. is one of a growing cluster of consumer startups that are expanding thanks to strategic backing from the Chinese Internet giant that executed the largest IPO in history last month.

Co-founded in 2010 by Thiru Arunachalam and Bala Krishnan, Peel was initially created to eliminate the clutter and confusion of juggling multiple remotes. The free app allows users to control TVs and DVRs as well as discover content, get recommendations and connect with friends. The app, which works on newer Android devices that have infrared, can control 3,500 brands of TVs and 600 set-top boxes.

Although generating revenue is not the startup’s main focus–Mr. Arunachalam has said Alibaba counseled him to look long term–it is making money. Peel is tracking to hit $10 million in revenue this year thanks to deals with Showtime, Sundance, National Geographic, HBO and other networks.

The infusion from Alibaba closed in June, though the companies didn’t announce the amount until today. It brings total outside funding to $95 million and will be used to expand Peel’s line of products and services.

“Some day I could see controlling lights, drapes, fans, locks, cameras, garage door openers,” Mr. Arunachalam told Venture Capital Dispatch last month. “The home is a place of passion for me and for my co-founder.”

Mr. Arunachalam said on Wednesday the funds from Alibaba will first be used to build out functions that enhance watching TV, like controlling air conditioning and lighting. He said Peel will share information about viewers and their habits with Alibaba, so the conglomerate can better market to them when they shop at its Taobao marketplace.

Employing close to 100, Peel competes against Viggle Inc., which makes a similar smartphone remote, and to some extent programmable custom universal remotes that allow people to control streaming services and hardware components from one device.

Since launching in 2012, Peel has grown to 90 million users worldwide who generate five billion smart remote commands a month, according to the company. Mr. Arunachalam said Peel was adding 10 million new users every month and right now more than 3 million of Peel’s total users use the app to operate their air conditioning.

Previous Peel investors include Redpoint Ventures, Lightspeed Venture Partners, Harrison Metal and TransLink Capital.

UPDATE: This story was changed to clarify the timing of Alibaba’s $50 million investment. It closed in June, prior to the company’s IPO.

Write to Lizette Chapman at lizette.chapman@wsj.com. Follow her on Twitter at @zettewil