Why Foursquare failed to reach escape velocity


foursquare-badges 3@simonowens posted a thoughtful piece on LinkedIn entitled Why Foursquare failed to reach escape velocity. I of course, have my perspective on why Foursquare has split/pivoted. (I tried to add my comment but LinkedIn wouldn’t allow me to comment. Probably too long.) Below is my comment.

Simon – This is a pretty good post and have a different perspective having used the service since late 2009 (Superuser Level 1!) and being a real fan of geo-services.

1. The geoGeek market is a very small niche as evidenced by what happened to Brightkite/Limbo. In other words the check-in behavior historically hasn’t been large enough to build a business off of. Your early adopters will most likely not make the transition to a tool used by most and founders have to be willing to abandon the niche if they’re going to get to the masses.

2. In the case of 4sq, the easiest way to get the masses to adopt that app would have been to make the points redeemable. At one point I had thousands of points but he fact that I couldn’t use 1000 points to get a free pizza at Beau Jo’s boggles my mind to this day. Gamifaction is one of the easiest ways to get to a larger audience and 4sq had relationships with over 650 thousand businesses which would have made point redemption relatively easy.

3. In the end, they divided the company in half because they did want every company should do; they listened to their data. They saw two separate behavior types. Customer 1 used it to check-in and compete (now Swarm) and Customer 2 used used it to search for places to eat (4sq today). Their web traffic is amazing and they recently added the ability for people to use the app without joining.

4. They have been able to monetize their location data with Microsoft and a host of others including a potential partnership with Twitter this year.

I’m curious to see what happens to Swarm/4sq and I definitely miss the old days. I love zee badges!

By Michael Myers