Sunday, November 14, 2010

Should FourSquare Be Scared Of Facebook?

Facebook's recent poaching of a major FourSquare engineer gave me a moment for pause, the backdrop being Facebook's aggressively going after Google. Microsoft never went after IBM like that. FourSquare is no Google. It is still a very small company. And Facebook Places has been decently successful.

When FourSquare last raised money I said FourSquare has to ride the imagination wave if it can hope to see an IPO in a few years. And if it can not ride that imagination wave, it should then sell. It is too early to tell which route FourSquare will go, but this onslaught from Facebook is a whole different topic. This is not an innovation issue. This is a survival issue.

Microsoft ate up a whole bunch of cutting edge, solid, independent companies in the 1980s, companies that were the equivalent of household names among the technorati but less than a decade later you never even read about them, not even in the tech history books. And even those you read about sounded like exotic entities. Did they really exist? Were they really big? Those were the questions that popped up in your mind.

There is a fundamental difference between then and today. There is the web. Supposedly the competition is only a click away. But that does not seem to take into account the inherent laziness in human nature. Users have let Facebook be the hub of so many of their online activities.

I am not with those who say but with Facebook everyone's homepage looks like everyone else's homepage. Facebook's innovation is not in the space dimension, although I think they have the best fonts of anyone, their innovation is in the time dimension. Facebook is the stream. And there is so much innovation they could do there.

The stream is to Facebook what search is to Google. That stream is the core product for Facebook and will stay core, I think.

So should FourSquare be scared of Facebook? Being paranoid helps, to paraphrase Andy Grove. And Mark Zuckerberg is a coder supreme. He stopped coding for the company years ago, true, but he was a coder as a kid, and a whiz kid at that.

A big company like Google should get paranoid about Facebook. A small company like FourSquare should get scared. That is fair to say. No matter where these three companies stand in a few years, the drama will be gripping.

When Zuck was sweating in the privacy brouhaha heat, I compared him to Steve Jobs. With his assault on FourSquare I find myself reminded more of Bill Gates in the late 1980s. The guy is in great shape. What is most amazing is the pace at which he has been innovating. Early on he called his users "dumbfucks." That did not bother me. The profanity was not going to bother me. And the intensity, boldness and recklessness of that moniker I kind of liked. I thought, this guy is in for the ride. He means action.

My message to FourSquare: be afraid, be very afraid.

But like often is the case, the challenge for FourSquare continues to be out there, what they see through their windscreen. The challenge continues to be, can you ride the imagination wave in your space?

As for poaching, Facebook is in the best shape of any company. It will go IPO in a year or two max. To join the Facebook mothership before that IPO has got to be alluring. It's about money. And maybe it is also about changing the world. But it is primarily about the money. It is dog eat dog.
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