Heavily Hyped Hipster Game Foursquare Shows It's Legit at SXSW
"We did over 275,000 check-ins last night [across the entire network]," Foursquare CEO Dennis Crowley told DailyFinance from Austin early Friday. "Every venue within three blocks is trending with 30-plus people."
A Nifty Business Model
Last year, Foursquare, the location-based game that allows users to "check in" at various venues and keep track of their friends' whereabouts, debuted at the hipster confab. Users who check-in the most times at bars and restaurants are awarded the title of "mayor," which can earn them free drinks and other prizes. Hard-core players amass colorful "badges" for such feats as, "Checking-in after 3 a.m. on a school night."
Foursquare's got a nifty business model: Obviously, stores, restaurants and other retailers would be interested in learning who their most frequent customers are, and providing incentives for repeat business. The company has been furiously striking deals with local businesses in cities across the country, and with outfits like Zagat's, the restaurant guide.
The service was quickly adopted by the self-styled "digerati" who populate early-adopter precincts such as San Fransisco and Brooklyn. But amid the effluvia of flavor-of-the-month web start-ups, Foursquare has shown remarkable staying power, and Crowley, the company's amiable founder, deserves a lot of credit. When I profiled the company on DailyFinance last year, Crowley came across as enthusiastic and unaffected. (One way to think of Crowley is as a sort of Pied Piper of hipsters.)
As he told me at the time, Foursquare's mission is simple: "We're trying to make cities easier and more interesting for people to explore," he said. "It's about helping you find where your friends are, exposing you to new places you may like, and rewarding you for being adventurous either in your neighborhood or in your city."
Breaking Down Barriers of Hype
Since its founding, the company has thrived, driven by adoring coverage by major media outlets. Why, just yesterday, The New York Times breathlessly announced that frequent Starbucks customers can earn "Barista" badges for habitual trips to the coffee chain. Indeed, some in the media have become so enamored with Foursquare that the coverage is occasionally peppered with grandiose hyperbole.
"Location-based mobile services like Foursquare are at the cutting edge of a transformation in the way offline businesses and their customers interact, by breaking down the barriers between the physical and the virtual," The New York Times gushed. Excuse me? I break down the barriers between the physical and the virtual by Googling a restaurant and then walking in the front door.
For all the bluster about breaking down barriers, the fact is that Foursquare is a genuine service that has earned its popularity for simple reason. It's fun. People enjoy using it. And best of all for its investors, the company has good business prospects.
As it celebrates its birthday at the Austin confab, Foursquare can boast of impressive numbers during its first year: Over 500,000 users have checked-in more than 15.5 million times at more than 1.4 million venues, with some 1200 of those venues offering free stuff, specials, or prizes for frequent players. And the company has raised $1.35 million in venture capital funding in a seed round led by Union Square Ventures, the New York firm led by VC guru Fred Wilson.
As for Crowley, he's not focusing too much on the hype, even if the service's success has fostered dreams of major digital disruption. "We really haven't been paying attention to it," Crowley says. "Too much to do. We have such an amazing opportunity to change everything about the mobile-social-local space, we've been heads-down trying to nail it."