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Summary:

Some analysts are assuming that Facebook’s new location feature will crush Foursquare, the startup that has popularized the location-based service business, because of the sheer size of the giant social network. But Foursquare founder Dennis Crowley says he is confident that his company will ultimately win.

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Foursquare founder Dennis Crowley

Even before Facebook launched its Places location feature on Thursday, many assumed that the giant social network would eventually wind up killing off Foursquare, the startup that’s gotten the lion’s share of attention — and $20 million in funding — for its location-based service. After the launch, several analysts said that Facebook would “crush” the smaller company (including two that used the exact same headline). Most made the same argument: namely, that Facebook’s sheer size would give it the lion’s share of the location market by default. But Foursquare founder Dennis Crowley isn’t having any of this, to judge from his Twitter stream following the Facebook launch.

Crowley (@dens on Twitter) says that he expects Facebook’s launch of Places to be beneficial for Foursquare in the long run by popularizing the idea of location sharing, saying: “4SQ took off because Twitter & FB taught people how to share online. 4SQ will live on cause FB will teach masses about checkin.” Then he adds that: “Facebook teaching the world about checkins is a great thing for everyone in this space.” Crowley also later notes that Thursday was Foursquare’s “biggest day ever in terms of new user signups,” although that could be because of a positive story about the company in the New York Times.

In response to a question from another Twitter user, Crowley says that it’s: “still very early in the space. Who ever thought someone would beat Yahoo at search?” Later, the Foursquare founder — who sold his previous location-based service, called Dodgeball, to Google — says that he was “stressed when Goog launched Latitude & thinking it would destroy dodgeball [sic] legacy,” adding that “strong products live on.”

Is Foursquare the Google to Facebook’s Yahoo? Perhaps. Crowley told Om recently that the company is close to launching a number of new features for the service that will make it even more engaging, and presumably widen the gap with Facebook’s new offering. Crowley also offered a humorous testimonial from his 86-year-old grandmother, who he says called him and said: “Hello. I want to know if this Face-Book is like yours. It sounds like Four-Squared, but without the fun.”

At least one investor is still publicly in Foursquare’s corner: Chris Dixon, angel investor and co-founder of Hunch.com, said in a Twitter message: “will be interesting to see how LBS plays out. my bet (and investment) is strongly with 4sq. focus and brilliant design wins.”

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  1. This is such BS. Crowley’s answers sound like some junior member at one of the VC firms that invested in Foursquare sat down and did twenty minutes of crisis management. Notice he didn’t really say anything really. They had their biggest day of new users? Who thought Yahoo would be bested in search?

    Don’t get me wrong, I think Foursquare will hold off the competition, but this is direct competition and they didn’t even acknowledge it. Also, where are these magical new features that Foursquare has been talking about for months now? Role playing, leveling up, i still can’t share pictures or video via foursquare, or how about simply leaving audio tips?

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    1. Thanks for the comment, Zachary — I agree that Foursquare is going to have to come up with some compelling new features in order to keep their momentum going and justify the investments that have been made in the company. Tough talk is not enough :-)

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  2. Terry Van Horne Friday, August 20, 2010

    Facebook did not add a single unique idea to this space. in fact the Name is exactly the same as Google’s, the ‘checkins’ were around before. The only thing they did differently? They set this up with little regard for user privacy. IMO, this is Facebook’s Buzz! It will be a miserable failure.

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  3. 120 million looks real good right about now. Nothing FQ has is proprietary. You would have thought with all the experience they would have known when to let it go.

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  4. It’s a ridiculous thing to write. It was ALWAYS clear that Google would blow past Yahoo in search. A comment like that proves that Dens isn’t quite ready for prime time.

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