Foursquare has raised $20 million in a second round of funding, ending speculation that the location-based firm would accept a bid approach from Yahoo. The company has chosen to take the additional venture capital money rather than pursue takeover talks with internet giant Yahoo, which is believed to have made an informal approach.
Carol Bartz, chief executive of Yahoo!, in an interview with The Telegraph, strongly hinted she wished to buy the popular start-up, which lets you ‘check-in’ to bars and restaurants’, with a supposed price tag of $80m (£53m). The funding was led by Silicon Valley venture-capital firm Andreessen Horowitz and Foursquare’s original investors, Union Square Ventures and O’Reilly AlphaTech Ventures. The new cash boost puts the value of the firm at an estimated $95m.
01/07/2010
Foursquare said it would use the funding to expand the company, which has more than doubled its user base in the past three months, to 1.7 million users.
The firm’s co-founder Dennis Crowley said in a company blog post on Tuesday that the funding would also allow it to move into a new office and invest in other infrastructure.
The company has about 1.8 million users, Crowley said. Internally, it has expanded from just five to 27 employees as the service has grown around the world.
Foursquare was founded only 15 months ago by entrepreneurs Crowley and Naveen Selvadurai, and is now leading a wave of geo-location applications for iPhones, Blackberries and other smartphones.
Users “check in” to their current location, while Foursquare hopes that businesses will pay it to advertise to these users and to offer them special deals.
“We are picking up 100,000 users every 10 days,” Crowley told The Wall Street Journal. Almost half use the service by checking in at least once a month after signing up, he said.