Where is it: www.Remind.com www.Remind101.com
Update - Name changed to Remind as of June 2014
What it is: A site that allows mass texting to groups, specifically designed for schools.
How does it work: First, a teacher creates an account, and then their classes. Texts can be created and sent immediately, or scheduled for a future date and time. Students and parents can sign up via text, or the website. Website sign up allows for either an emailed reminder (which also sends a verification email), or text message. This is a one-way system: You cannot see their email addresses or phone numbers, and they can't see yours. Then cannot email or text you through this service.
What data do they collect: What you supply them with, for example: telephone number, name, email, etc. Additionally, they may also collect data such as you IP address, place cookies on your system, etc. They do not disclose information to third parties, but may have links to other sites that they do not control, and their policies may differ.
How well does it work: I'm experimenting with it in my classes now for homework reminders, for the last two weeks. With a single announcement about the service, around 20% of my students immediately signed up for the service. (I allowed them to use their phones to sign up in class.) These were mostly students who have been late, or have missed homework assignments. Comments have been positive enough that I'll be using the service in Fall 2014 and see how it does during a full semester.
How do they support the site: At this point I don't know, outside of investor infusions. Their Terms Of Service state that in the future, they may provide new premium features for a cost, but the system as it now runs is free. TechCrunch has an article Red Hot Remind101 Gets $15M (http://techcrunch.com/2014/02/04/remind101-gets-15m-from-john-doerr-to-bring-free-secure-text-messaging-to-teachers/) that covers this and other aspects of the service.