As Foursquare board member Bryce Roberts puts it, the “wire transfer heard ‘round the world” was authorized yesterday. The amount was a cool $20 million and it concludes a long and drawn out battle regarding Foursquare’s future. Early on, CEO Dennis Crowley toyed with the idea of actually selling the company. Yahoo and Facebook were both trying to court the young location-based startup.
During the battle for Foursquare, Andreessen Horowitz originally withdrew in the confusion, but this was part of the plan. They now lead this round of funding, cooperating with existing investors Union Square Ventures and O’Reilly AlphaTech Ventures. It’s hard to deny that Foursquare is a great opportunity. They have been able to forge partnerships with major brands before even receiving Series B funding. According to Horowitz, they have a “great Founder/CEO” and are going after a “gigantic market.” Specifically talking about Crowley, Horowitz says he sees the leadership traits they look for when investing and Crowley is a “keeper of the product vision.”
Crowley has put in a lot of work during the fundraising process. The money will be put to good use in expanding the company’s vision and work force. They need more engineers to expand the product. The current staff of 27 has outgrown their current location and will be moving into a bigger spot within the same building. “It’s awesome,” says Crowley, “we can hear them building it upstairs right now!”
A major point to keep in mind is the hard decisions Dennis Crowley and Foursquare had to make in the interest of turning a hot product into a successful company. “It is a really cathartic and emotional decision to make,” says Horowitz. “If you look at what those guys had to walk away from—generations of your people being set financially in order to try to build a great company—that takes a lot of courage.”
Remaining independent is an intelligent move for Foursquare. Any service can become location-aware. As a matter of fact, Twitter, Google Buzz, and Facebook are all now location-aware or in the process of adding the feature. Horowitz makes an extremely important point in that the value of Foursquare is not that it lets you share your location. As with many other successful web services, the value comes in the information that Foursquare holds and collects. Foursquare is only in the early stages of development and it has the potential for a very successful future.