Foursquare Labs Inc. knows what it’s like to go from hot to not. When the company introduced its namesake social media app at South by Southwest in 2009, it was an instant hit. The app broadcasts a smartphone user’s location to friends to facilitate spontaneous meetups and offers other gamelike features, such as dubbing a user “mayor” of a favored spot through repeat visits. People loved it. Within months, the New York Times was calling Foursquare “the tool of choice” for young city dwellers, while Mashable declared that it “may be the next Twitter.”
It wasn’t. As Foursquare’s novelty faded, user growth and investment stalled. But before the repo men had to cart off the furniture, co-founder and then-Chief Executive Officer Dennis Crowley realized the company had another card to play. While the tech world had cooled on Foursquare’s breed of apps, it had become obsessed with data about the consumers who used them. What people like on Facebook, search on Google, and write about in Gmail are all valuable leads for marketers. So is a consumer’s physical location—and Foursquare could figure that out with greater precision than anyone else.
