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Foursquare Turns Down $100M

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  • WTF? (Score:5, Insightful)

    by Jaysyn (203771) <jaysyn+slashdot AT gmail DOT com> on Thursday April 08, 2010 @11:01AM (#31776386) Homepage Journal

    Christ, I don't think I've ever even heard of these guys. They should have took the money & ran.

    • Re:WTF? (Score:5, Funny)

      by eldavojohn (898314) * <eldavojohnNO@SPAMgmail.com> on Thursday April 08, 2010 @11:05AM (#31776470) Journal

      Christ, I don't think I've ever even heard of these guys. They should have took the money & ran.

      Agreed. With that kind of money you could almost afford your own US Senator ... or US Representative at the least. With one of those they could start pushing their pro-Square agenda. For far too long the Mods and the Rockers have enjoyed an unquestioned two party system ...

      • Flatland (Score:2, Funny)

        by javalizard (781952)

        I, for one, welcome our new square overlords. It'll give the "religious circles" a run for their money. I can see how the religious circles would be irked by the homo-erotic behavior of four squares vs a normal single square married to a traditional acute triangle. Then again, it's also much less dangerous as the known dangers of being stabbed to death on a daily basis don't exist. /flatland-humor

      • For far too long the Mods and the Rockers

        I'm a Mocker you insensitive clod!

    • Re:WTF? (Score:5, Insightful)

      by ircmaxell (1117387) on Thursday April 08, 2010 @11:06AM (#31776486) Homepage
      Unless this is a marketing ploy (Have a friend "offer" $100 Million, just so you can turn it down publicly)... After all, news that a social site turns down huge money would likely generate publicity...
      • Re:WTF? (Score:5, Funny)

        by bFusion (1433853) on Thursday April 08, 2010 @11:09AM (#31776530) Homepage

        I don't think Yahoo has any friends.

      • posting to undo misclick on redundant.
      • Honestly, I'm going to have to go with FourSquare on this one. Why should the most innovative companies get swallowed by bigger fish? It only takes away control over their product, causing untold suffering to millions (\s). Do you applaud every time banks buy each other out? Let the mom and pop tech start-ups find their own way.
        • Re:WTF? (Score:4, Insightful)

          by iamhassi (659463) on Thursday April 08, 2010 @12:38PM (#31778030) Journal
          "Why should the most innovative companies get swallowed by bigger fish? "

          because we can only have so many "innovative" companies. A dozen facebooks wouldn't work, a dozen twitters won't work. No one wants to log into a dozen different twitter clones and update their status. You have big sharks, and you have the guppies nipping at their heels. The tiny bit of innovation that Foursquare adds could be added to Facebook tomorrow and Foursquare would vanish into oblivion.
          • Yeah, nothing new can come along. Only the established survive in the business world. That's why DEC, US Steel, Cunard, Circuit City, Frigidaire, etc... are all still the giants they used to be and no one has supplanted them.

    • Re:WTF? (Score:5, Informative)

      by reverseengineer (580922) on Thursday April 08, 2010 @11:13AM (#31776624)
      Apparently, this same guy had a similar project called "Dodgeball" which Google bought out in 2005- and then killed in 2009 to replace with Google Latitude. I don't know how much he got for Dodgeball, but it may be that he really can afford to walk away from offers now. Both Dodgeball and "Foursquare" are/were location-based social networking services for mobile devices- Foursquare appears to tweak the concept by turning it into a sort of Zynga-style game where you earn awards for using the service. 100 million bucks for that.
      • by Jaysyn (203771)

        Zynga? The spyware makers?

      • Re:WTF? (Score:4, Informative)

        by Orange Crush (934731) on Thursday April 08, 2010 @11:45AM (#31777168)

        I wouldn't compare Foursquare to Zynga . . . there's a game aspect, but it isn't ad-scam laden like Zynga's properties. Foursquare is broadly very similar to services like Loopt and Google Latitude, but with a few enhancements. Each time you "check in" to a location, you earn points. Whoever has the highest score is declared "Mayor" of that particular venue. Venues are also tagged to classify what sort of place they are, and you earn badges based on your check-in habits. For instance, three times in one week at venues tagged as being gyms will earn you the "Gym Rat" badge; go to a certain number of places tagged as having karaoke nights in a certain amount of time and you get the "Don't stop believin" badge, etc.

        There are more aspects too--you can set up "to dos" to suggest certain activities at certain venues, and people can add them to their to-do list, etc. It's basically just another "I am here / what are my friends doing / what's a popular place to go tonight" app with some game aspects.

    • Re: (Score:2, Insightful)

      by AvitarX (172628)

      Seriously,

      I went to the site to see what it is. They have no explanation of why i would want it on the front page, except for a link about us.

      A 2 minute long video, that's a howto.

      30 seconds in I got bored.

      even with this publicity, I think it is unlikely to take off. There does appear to be links for developers trying to leveragge the site into money though.

      • Re:WTF? (Score:5, Interesting)

        by FreeUser (11483) on Thursday April 08, 2010 @11:23AM (#31776796)

        A 2 minute long video, that's a howto.
        30 seconds in I got bored.
        even with this publicity, I think it is unlikely to take off.

        Besides, losers who use foursquare are just begging to be stalked. It makes Facebook's abysmal privacy look positively friendly by comparison.

        In fact, stalking foursquare losers ("fourstalking") has become quite the pastime, so much so that this attention junkie [lalawag.com] quit the service, despite craving the attention. A part of me feels sympathy...while another part can't help but feel these narcissists are getting exactly what they deserve.

        • And the people who legitimately use it to connect with or compare notes with friends are also losers?

          Not to mention Foursquare has options to not share your updates publicly (like mine) so that only your pre-added friends see where you've been or are.

    • Re: (Score:3, Insightful)

      by Opportunist (166417)

      Yup, you never heard of them. Now, though, you did. They were the loonies that turned down 100m for a name nobody knew about.

      I think the price just hit the 200m range.

    • Re: (Score:3, Insightful)

      Christ, anyone who hasn't heard of Foursquare isn't really keen on the social networking scene. It's the latest buzz. HA, get it? Google Buzz? Alright I'll stop with stupid puns.

      The general Idea is either
      A) They make enough money already (I believe another project of theirs was bought out by Google some time ago)
      B) They don't want their project to die, they want it to become worldchanging
      C) They are holding out for more, because its worth more.

      Or any combination of those.Yes, well, you can say A and C don't

      • Two points:

        D) They are idiots, and are far overvaluing their business.

        $100 mil? Seriously? That's a fucking huge amount of money! There aren't a ton of web-based businesses, not selling a physical product, which are worth this much. Dreaming that you're going to be the next Facebook or Ebay is not often a financially viable dream to have.

        Secondly, I would argue that Foursquare is not well known. It's only got around a million users, which, as a percentage of those "really keen on the social networking
        • Re: (Score:3, Insightful)

          by Plaid Phantom (818438)
          In an economy where people get rich by betting that other people can get rich placing the right bets on what companies will be profitable, "worth" and "value" have somewhat arbitrary meanings.
        • How many people Know about Facebook but don't use it? How many people know about MySpace and don't use it? How many people know about Twitter but don't use it?

          I think its more popular than you realize. Simply because I don't own a phone capable of running it, or because I choose not to use it for the very reasons listed above, doesn't mean that it isn't a well known trade name.

          They don't have to "Dream" to be the next facebook. Facebook was offered like 8 or 9 hundred million right? Twitter, which was just

        • by Trepidity (597)

          Their investors already think it's worth that much currently, though: Foursquare just raised a round of venture capital at a valuation of around $90 million. Why would an investor who just bought in at a price that implies a $90 million valuation be keen to sell out at $100 million? Venture capitalists usually aren't too excited about 10% returns.

          Now of course, you could argue that they were stupid for buying in at a $90m valuation to begin with. But a few weeks ago they thought that was a good deal, and I

    • by JWSmythe (446288)

      I think you got the important part. Most of us have never heard of them. They aren't a big outfit. Bragging up that you turned down big money is sometimes just a bragging point.

      I worked at a place once, that was totally full of themselves. And no, I'd be pretty sure none of you ever heard of it. The CEO told us in a company meeting (attendance required) that he had turned down a 10 million dollar from Microsoft to buy us out. I thought about it while he continued, why wou

      • by jo42 (227475)

        Most of us have never heard of them.

        Except the fuckwads over at ReadWriteWeb, Mashable and TechCrunch is all they blog about: Foursquare this, Foursquare that, Foursquare farted, Foursquare puked. Fuck. Makes you wonder if they have a financial interest in them...

    • by iamhassi (659463)
      "Christ, I don't think I've ever even heard of these guys. They should have took the money & ran."

      I've heard of them, but very little. I asked some net savvy teens and early 20-somethings and they said "Foursquare? .....like, the game?"

      I can only imagine the owners of Foursquare are too young or stupid to remember the late 90s .com burst. [wikipedia.org]
    • by Gudeldar (705128)
      Obviously you don't read Techcrunch. Arrington has been relentlessly promoting Foursquare, I wonder if he has stock in them or something.
    • by Darinbob (1142669)
      It's a CEO effect. I've seen it several times. Basically they're sales people, who daily keep telling customers and investors how great and awesome their company is. Over time they start to believe it. They honestly believe their company is on the verge of greatness, or that their current problems are just minor blips, or that next quarters reports will prove them right, or that their minor distinguishing feature is revolutionary, or that the one big customer they need to keep afloat is just around the
  • Well.. (Score:5, Informative)

    by ZeroExistenZ (721849) on Thursday April 08, 2010 @11:07AM (#31776490)
    Why would one offer them 100 mio for it if it's so worthless, for one.

    For two, why is money such a big deal? If you love what you do and can provide for yourself with it, why whore yourselves out? It's not about being filthy rich, but doing what you love, right?
    • Re:Well.. (Score:5, Insightful)

      by Anonymous Coward on Thursday April 08, 2010 @11:09AM (#31776538)

      It is easier to do what you love when you are filthy rich.

      • Re: (Score:3, Funny)

        by Anonymous Coward

        It is easier to do who you love when you are filthy rich.

      • by PPH (736903)

        It is easier to do what you love when you are filthy rich.

        But if what you want to do is to develop this kind of web app, then perhaps Foursquare's owners figure that they're ahead of the game by holding onto the asset rather then taking their money and starting over. If $100 million is a fair price* for the asset, then they would have just broken even.

        *Breaking even is a difficult number to come up with accurately. A smaller, more focused team may have a better chance of growing a business, thus producing greater future value. On the other hand, the MBAs who make

      • by Trepidity (597)

        I think the founders of Foursquare already are filthy rich from selling previous companies, though. So they don't have to sell this one unless for some reason they needed to be even more filthy rich.

    • Re:Well.. (Score:4, Insightful)

      by mcgrew (92797) * on Thursday April 08, 2010 @11:21AM (#31776774) Homepage Journal

      For two, why is money such a big deal? If you love what you do and can provide for yourself with it, why whore yourselves out? It's not about being filthy rich, but doing what you love, right?

      Some people collect stamps, some people collect coins, some people collect butterflies, and some people collect obscenely huge amounts of money.

      Some people worship God, some people worship life, some people worship nature, some people worship money.

      Some people love their god above all else, some people love their spouse above all else, some people love their children above all else, and some people love money above all else.

      It's all about what you love and what your personal value system is. Personally, I pity anyone who thinks a thing that lacks a price is worthless.

      • Personally, I pity anyone who thinks a thing that lacks a price is worthless.

        There's a girl I want but she's engaged... she won't leave her guy for me, although she keeps deflecting every offer I make to back off and let her be.

        Most people tell me this is stupid and I should leave. They've also said it makes no sense that I'd rather let her go if the guy she has is actually going to make her happy. You're quite right, I think... even if I could have her, if it came at the expense of her happiness there would be no worth in it. You can't put a price on that. People around me d

        • Since we're discussing about prices, here's my theory:

          You made her various offers. The fact that you did that means that her price is high while your price is low. Girls don't want to go near low-valued individuals, especially if the disparity between your prices is high. If you had high price, she would have made the offer first (i.e., by flirting).

          Imagine that you're Brad Pitt. Would you bother making offers to girls just to get laid? The solution to your problem is to increase your value. Go ou
          • She started it. She did flirt for a while.

            The problem seems to be she has someone she doesn't want to leave. I mean imagine if you had a Mazda RX-8. You LIKE the RX-8. Now, you could trade the RX-8 for a Porsche 911 Carrera. Nice car... but you really like the RX-8. You'll take a look at the 911 ... you're not taking it for a test drive though, for whatever reason; besides, the dealer already told you, no test drives. You could buy it, it's a couple years old, only $25k, trade the RX-8 in and throw $

            • It's good to analyze things from a detached and impartial point of view, while recognizing that emotions are part of being human. All too often, we Slashdotter types think that logic is all that's important. Anyway, that was a good car analogy to keep this thread on topic. :)
    • Re:Well.. (Score:5, Insightful)

      by A Name Similar to Di (875837) on Thursday April 08, 2010 @11:34AM (#31776992)
      I logged in for the first time in a year just to agree with you. There was a survey a few years back (sorry I couldn't find the link) suggesting that many business owners regret going public and losing control of their company, despite the cash they made.

      I realize Four Square's case isn't the same as going public, but it's similar. If you love what you do and already make good money, why ruin it? And for the record, you can pay everyone's salary and still make zero profit, so "unprofitable" doesn't mean that the people working there aren't making good money.
      • Re: (Score:3, Insightful)

        by plover (150551) *

        Turning down the money is irresponsible (unless it's truly vastly undervalued, which is possible.)

        The only reason not to sell it for a price like that is if he already has enough money and is running it as a hobby. If that's the case, it can make or lose some amount of money without it really affecting him. But just because Top Honcho has $XM in the bank already doesn't mean his employees have equal resources. If it starts losing money and he gets bored, who is going to keep all those employees in payche

        • Re:Well.. (Score:4, Insightful)

          by kidgenius (704962) on Thursday April 08, 2010 @12:50PM (#31778228)
          Ah, it may be irresponsible to you but the owner of that company owes no one anything. That's right, not even his workers. If the workers wouldn't have been made millionaires, that's not his problem. They should then go out, start a company, and get bought out and do it themselves. Yeah, if he wants to be a nice guy, he can throw stuff their way, but that's his prerogative.
          • by rainmayun (842754)
            Not terribly insightful. Deciding to pursue a buyout (or go public) has nothing to do with altruism for employees compensated by stock options - assuming he's in business to make a return on his investment (and that's safe until you clearly demonstrate otherwise), it's in his selfish interest to keep his employees reasonably happy. Part of that is making good on the implicit promise that as an owner, you will try your best to make those options worthwhile. Departing employees, especially in a startup, lea
            • by kidgenius (704962)
              I never said it made good business sense to turn down something like that. All I'm saying is that it's his choice. You may not agree with it. I may not agree with it. And a lot of people may think he's an idiot and there is no way for the company to go but down. But in no way does he "owe" anybody anything.
          • Re:Well.. (Score:4, Insightful)

            by ultranova (717540) on Thursday April 08, 2010 @06:38PM (#31782962)

            Ah, it may be irresponsible to you but the owner of that company owes no one anything.

            I'm pretty sure that stock options come with the expectation that the company will be managed in such a way that their value will be greatest possible. It's certainly implied in the option system, howeve I'm unfamiliar with the laws surrounding this issue. Could someone confirm this either way?

            That's right, not even his workers.

            I have noticed a disturbing tendency of corporations demanding loyalty from their workers yet giving none in return. This, in turn, breeds cynicism in said workers and makes things like stealing company assets seem more acceptable to them, perhaps even desirable.

            There's a reason why humans developed empathy: it makes groups far more efficient, since their members don't have to waste their energy worrying about getting a dagger in their back. But I guess the psychopaths who lead most corporations aren't capable of understanding that.

            If the workers wouldn't have been made millionaires, that's not his problem.

            Actually, I'm pretty sure that it is; if not legally, then simply because options are going to be completely useless as motivators from now on (and also because he runs a serious risk of bodily harm - there are limits to what you can do to someone you see daily and not suffer consequences).

        • Re: (Score:3, Insightful)

          by MikeBabcock (65886)

          I've heard this comment before and its moronic.

          You're not just turning down money, you're also maintaining control.

          Many many more businesses have done better or worse for their employees and customers based on management and control at the top than by getting huge influxes of cash.

          Think Netscape, AOL, or all the little companies Microsoft and Intel have bought up and quashed over the years.

          Taking the money typically means losing control of the business. That's one of the things Google's founders refused to

        • If it starts losing money and he gets bored, who is going to keep all those employees in paychecks?

          And this differs from every other business in what way? The only thing keeping me employed today is that my company's owner still likes running his business. Should that ever change, he owes me no responsibility to keep running it to meet my needs. Yes, it'd suck if he decided to close the doors one day, but that's why I'm careful about whom I choose to work for.

        • Re:Well.. (Score:4, Informative)

          by Trepidity (597) <delirium-slashdot AT hackish DOT org> on Thursday April 08, 2010 @03:36PM (#31780834)

          Generally even early employees won't become millionaires in these sorts of deals.

          Typically, VCs get paid back all their initial investment right off the top (usually part of a "liquidation preference"). In Foursquare's case, that's about $12 million, leaving an $88 million pot. Of the rest, typically VCs plus founders own almost all of it. A very early employee, if lucky, might own up to 0.5% or so of the company. That would give them $440,000 in this scenario. But that's something of a best case, too, because employees often own common stock, while investors and founders own preferred shares, and there are sometimes liquidation preferences for those payouts too.

          It's on the outside realm of possibility that there exists an early Foursquare employees with the requisite ~1.2% or so of equity to actually make one million dollars from an exit like this. But there wouldn't be many, and it's quite possible there are none.

          Oh, and unlike the VCs and founders, employees typically have a 2-to-4-year vesting period, so they don't get any of their money unless they stay with the post-acquisition company for multiple years, even if they hate their new boss.

      • Perhaps someone has already mentioned this, but this is pretty much what 37signals says in their new book "ReWork". A brilliant read.

    • Re: (Score:3, Interesting)

      Because 4square's not making any money *now*.

      I've seen it posted here somewhere, but it's been said that money can't buy happiness but the lack of money can buy a whole lot of misery.

    • Hey he's fixed the typo in the article!

      "I sold my location-based service I started in my basement for 100 GPS units!"

    • Considering this guy already had one "company" that sold to google (and since at that point there can't have been more than a handful of people since it was really more of an idea+implementation than a company at the time), he probably has enough money to do what he loves quite comfortably.

      At this point maybe he likes working on the software on his own terms. If he sold, he would have to come up with a whole new extension of his original idea if he wanted something to dabble with--maybe this feels like a

    • Re: (Score:3, Insightful)

      by Angst Badger (8636)

      For two, why is money such a big deal? If you love what you do and can provide for yourself with it, why whore yourselves out? It's not about being filthy rich, but doing what you love, right?

      We live in a culture where profit is the ultimate good, transcending all other considerations, including individual and even species survival. For someone to refuse profit -- or, as is more likely in this case, to defer profit now in hopes of greater profits later -- is literally beyond comprehension for most people. And then they get angry because they're envious of all that money. To be fair, people spend their entire lives bombarded daily with the message that wealth and possessions are the only things t

    • by Rockoon (1252108)

      Why would one offer them 100 mio for it if it's so worthless, for one.

      Lets suppose it has 5 million users worldwide. Thats $20 per person. Thats not fucking bad, considering (A) you just purchased their eyeballs (the actual product of all social network businesses), and (B) you have their location.

      What is a local television station worth? This service has all the advantages of local advertising markets, but with a global advertising infrastructure.

      Did you think the offer was for their IP?

      The IP isnt their product. Their product is users, and they rent them to advertise

    • by Bakkster (1529253)

      Why would one offer them 100 mio for it if it's so worthless, for one.

      To those thinking it's worthless (not you, I assume), they forget that FourSquare has location and behavior data on all of its users. It's a goldmine for targeted advertising.

      Here on Slashdot, many people may not realize that other people go to places called 'bars' to drink alcohol. FourSquare knows when you are visiting bars (known to the social butterfly as 'bar-hopping'), and where you are currently, and start serving ads for other local bars or pizza places with a high expectation that you are likely

      • My bar is sacred to me. Telling me to go to another bar is akin to proselytizing.

        In short, heresy.

        Thank god FourSquare didn't sell out.

        • by Bakkster (1529253)

          Thank god FourSquare didn't sell out.

          You expect this isn't their intention for monetization, one way or the other? Either they will serve targeted ads, sell to someone else who will, charge the users to play, or go out of business.

    • Speaking as an entrepreneur, and the founder or co-founder of multiple online businesses, there is nothing I would love more than tempting one of the big fish into offering me my desired lifetime's earnings for one of my startups. I'd sell in an instant, no matter how much love and devotion had gone into the business. That's kind of the jackpot for most of us serial startup folks. (Being the owner of a moderately successful enterprise is a very distant second, though acceptable, option.)

      Funny thing is, t
  • idiots (Score:4, Funny)

    by electrosoccertux (874415) on Thursday April 08, 2010 @11:07AM (#31776504)

    These guys turning down the money are idiots, all idiots. Twitter cannot create the revenue to generate the profit to pay back $500m. Or $900m in the case of Facebook. They [owners] all should have sold it, they're never going to get that kind of money anywhere else. Have you seek Zuckerberg give presentations? The goofball can't even give a proper PR announcement, let alone get people excited about anything Facebook is doing.
    This goes doubly so when the buyer will let the owner retain control.

    • I cant help but think there is another .com type bust to happen with social media. It seems too much money is being thrown around by companies and organisations with no understanding of the subject matter and little new revenue being created. I know companies like Newscorp and Yahoo want to get a hold of popular social media sites to get access to the install base but they dont realise that doing so will kill the install base.

      I wonder if these rejections will hasten or delay the bust of social media.
  • by wombatmobile (623057) on Thursday April 08, 2010 @11:08AM (#31776510)
    Dennis Crowley learned two things from his earlier experience of selling Dodgeball to Google. 1. A big company like Google can destroy a little company. 2. When your bank account is 8 digits big, 9 digits is not as important as following your passion.
    • by garcia (6573)

      1. A big company like Google can destroy a little company.

      It didn't destroy it, it just wasn't doing things on Dens' schedule. Dodgeball became Google's thing, not Dens' personal side project and thus their desire to add developers to his team was low and their desire to tie him and his staff up in endless meetings was more important.

      But as far as the money is concerned, yeah, that's probably true.

  • by jayhawk88 (160512) <jayhawk88@gmail.com> on Thursday April 08, 2010 @11:27AM (#31776874)

    We're going Fivesquare

    • by eulernet (1132389)

      Too bad: Foursome is already taken.

    • by mooingyak (720677)

      That doesn't make any sense.

      The speech goes "Four square and seven years ago." Not five.

      • by BobMcD (601576)

        Four score, not square.

        Or, if that was meant as funny, I guess I don't get it.

        • by mooingyak (720677)

          Or, if that was meant as funny, I guess I don't get it.

          Insufficient sleep is sometimes the line between submit and cancel.

          Couldn't help it though. 'Four square and seven years ago' just got stuck in my head once I saw the headline and posting something using that line was the only way to get rid of it.

    • by CmdrPorno (115048)

      I'm going to 4chan. They're much more friendly.

  • Upstarts. (Score:5, Insightful)

    by MaWeiTao (908546) on Thursday April 08, 2010 @11:45AM (#31777160)

    These start-ups love to pass themselves off as scrappy little guys nipping at the heels of giants. In my experience these companies, the vast majority of the time, are backed by investors with very deep pockets. These guys are undoubtedly banking on the hope that this investment will pay off in a big way. There's this infatuation investors have with these social sites and it's easy to see why. Minimal investment, little substance, but the pay offs can be huge if people get hooked. Why spend a fortune building a company that actually makes product, with the expense and work that comes with it, when you can just do this? And given that development can easily be outsourced to India these ventures even more attractive.

    Right now they're at the hype generating phase. By turning down this offer they have garnered media attention. And amongst the ignorant masses people will believe that these guys are principled. I think they're waiting to hit critical mass with users. Their hope is that they become the next Twitter. Then they'll sell especially if they haven't figured out a way to make money on something that seems completely pointless.

    • by mea37 (1201159)

      The truth (or misleading-ness) of your statement may depend on how you define the terms "backed by" and "investor with deep pockets".

      I worked for a tiny software startup in the reporting field, back before enterprise reporting was a mature market. You could claim the company was "backed by investors with deep pockets". It's called venture capital, and it is in no way inconsistent with the view that the company is a dwarf trying to take on giants.

      See, those deep pockets aren't fully committed to making tha

    • Re:Upstarts. (Score:4, Interesting)

      by Trepidity (597) <delirium-slashdot AT hackish DOT org> on Thursday April 08, 2010 @05:24PM (#31782064)

      Yeah, I'd be willing to bet the investors had a big part in turning this down, too. (Actually, they probably had to; VC firms usually demand a say in these sorts of decisions.)

      A bunch of major VCs bought in to Foursquare about a week or two ago at prices that value the company at $80 million on paper [techcrunch.com]. Given those valuations at the buy-in, an $100m exit is simply not enough for the VCs to get the sort of return on their investment they have in mind.

  • Only the deal makers know what the details of the $100 million deal. Chances are excellent it's a bad deal. Some ways the deal can be bad follow....

    Often times, there is a top line PR number, that if *every* option played to the start up's benefit, then they'd have earned the number. But most of the deals are completed leave the start-up members meaningfully smaller pay outs.

    Let's say the deal flies and the people selling meet the conditions of the purchase, there's the matter of actually getting paid.

  • by sammy baby (14909) on Thursday April 08, 2010 @11:50AM (#31777274) Journal

    Maybe they turned down the bid because they wanted to stay independent and liked what they did?

    Jesus, it drives me crazy listening to people go "what morons, they should have taken the money and ran." Why? What if they really like what they do?

    Disclaimer: I'm not familiar with Foursquare's product or management, and I have this crazy notion that there are things that are worth more than money.

    • Maybe they turned down the bid because they wanted to stay independent and liked what they did?

      Jesus, it drives me crazy listening to people go "what morons, they should have taken the money and ran." Why? What if they really like what they do?

      Disclaimer: I'm not familiar with Foursquare's product or management, and I have this crazy notion that there are things that are worth more than money.

      Social networking sites rise and fall relatively rapidly. The insinuation is that they should have taken the money because even if they love what they do, they probably won't be doing it for much longer. Having the money would enable them to easily go do something else they love.

    • by bconway (63464)
      Foursquare is venture-backed. There's nothing independent about it.
  • Foursquare looks at first glance to be a site where the entire point is to do things that earn 'rewards'. Looks like they call them 'badges'. Hmm... Life as a massive DnD game, minus monsters and death. Ok...

    Like 'unlocking' my city (or cities, where I am). Oh yeah, sounds like endless billboards on my phone. Essentially advertising I participate in. Not a new concept, I participate in advertising now by losing pieces of my life to it.

    Kinda like Farmville without the Facebook stuff. And more ads, I b

  • Social networking sites can either become incredibly successful or fail horribly, and it's generally down to luck as to which happens. He could make more money at a later date, or go bust.

  • Has the US dollar really become so weak?

  • by noahm (4459) on Thursday April 08, 2010 @12:30PM (#31777872) Homepage Journal
    Foursquare hasn't turned down anything, as far as anybody knows. In fact, the Yahoo! buyout is still only rumor. The article is basically representing the opinion of some analyst entrepreneur. Quoting from the article:

    Sometimes making a fortune is dumb, writes entrepreneur Charlie O'Donnell—which is why, O'Donnell adds, Foursquare will wisely walk away from a rumored $100 million offer from Yahoo.

    Who's Charlie O'Donnell? What's his role in Foursquare? Is he really making statements on their behalf? I doubt it. Quoting from the photo caption later on,

    [Photo: Laughing Squid's pic of Foursquare CEO Dennis Crowley who, to be fair, may not have turned down anything yet.]

    So, wtf? There's no story here, it's just some random dude repeating what some other random dude said would be a wise move.

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