10 hot social media startups to watch
- 18 April, 2013 11:02
This roundup of hot social media startups was culled from a list of more than 40 nominees that were originally compiled on Startup50. Because narrowing a list of so many compelling startups down to 10 is both tricky and subjective, we turned to crowdsourcing for part of the decision-making process.
Nearly 2,000 people voted, and the top 10 vote-getters were then scrutinised for any weaknesses. Eight out of the top 10 made the final list, proving not only the wisdom of crowds, but the wisdom of getting your businesses message out there effectively. The top vote getters clearly have made real investments in PR and marketing, and as a result, they understand their customers better, have tighter messages and have refined their positioning.
For more on selection criteria and weighting, click here. One thing to note, one factor normally weighted heavily--the amount of VC funding raised--is deemphasised in this roundup.
Social media startups just aren't as well-funded as, say, cloud or mobile startups. One factor is that no one has really figured out which business models will actually generate revenues consistently in this market.
Second, social media startups tend to be cloud-born companies that don't require nearly as much up-front capital or development efforts as startups in the past did. Most of these startups provide focused services, not huge, complicated on-premise software suites.
Finally, VCs are still a bit wary of this market. After Facebook's IPO underperformed, can you really trust even the leaders in this space? That perception will likely change over time, but a lack of funding certainly isn't slowing down the formation of these startups.
What they do: Provide cloud-based ‘Social Enterprise Performance Software’, which unlocks employees' critiques of their companies, as well as their ideas for improving the companies they work for.
Headquarters: Leesburg, Virginia
CEO: Edwin Miller, who is also a managing partner at (i)SAGE and who previously served as president and CEO of Everest Software.
Funding: The company is backed by US$1 million in angel funding.
Why they're on this list: 9Lenses intends to change how C-level execs communicate with their workforce. Every CEO knows his or her company isn't perfect, but it's tough to get constructive criticism from those in the know--employees. 9Lenses' ‘interview apps’ are designed to open up employee thoughts and ideas in a way that is positive and engaging, giving CEOs the chance to respond and act in a way that isn't defensive or conflict-driven.
The platform comes with more than 100 pre-packaged surveys. Companies can also gain insights into specific events, such as possible mergers, and they can use the surveys to identify workflow bottlenecks, encourage data-driven decision making and facilitate strategic planning.
Market Potential and Competitive Landscape:We're not aware of any direct competitors to 9Lenses. However, it indirectly competes with the consulting industry and with more traditional Enterprise Performance Management tools.
For many social media startups, their business models are a bit nebulous. There are tons of great social media concepts out there, but few proven ways to monetise those concepts. 9Lenses looks like a possible exception. Customers include HP, Raytheon, CoreSite, Oracle and Parata Systems.
What they do: Provide a photo-editing platform.
Headquarters: San Francisco, California.
CEO: Tekin Tatar, who was formerly business development manager of McCann Relationship Marketing.
Funding: US$2 million in seed and Series A funding from Golden Horn Ventures.
Why they're on this list: As blogging, self-publishing and photo-sharing through social media all continue to grow, more and more people are seeking photo-editing tools. These people don't want to spend a ton of money on something like Photoshop, and they want something that is easy to use. BeFunky intends to meet those demands.
Market Potential and Competitive Landscape:BeFunky isn't the only game in town. Aside from incumbents like Adobe, alternatives such as PicMonkey will give BeFunky a run for its money. BeFunky claims more than 5.8 million active users.
What they do: They provide an ‘intranet solution that is reminiscent of Pinterest, to address the knowledge sharing, collaboration and content management issues that are plaguing modern businesses’.
Headquarters: Austin, Texas
CEO: Craig Malloy, who sold his previous companies, ViaVideo and LifeSize Communications, to Polycom and Logitech, respectively.
Funding: In March 2013, the company secured an US$8 million second tranche of its Series A round, bringing the company's total funding raised to $18m. Austin Ventures, Redpoint Ventures and CEO Malloy are the investors.
Why they're on this list: Bloomfire's software unites information silos across cloud, social and mobile platforms with a centralised user interface that enables workers to instantly connect with subject matter experts and relevant content across their organisation, promoting anytime, anywhere collaboration.
The goal is to make collaboration and information sharing easy, while also promoting collaboration among workers and departments that wouldn't communicate otherwise. Bloomfire argues that it creates a ‘Pinterest-like experience’, which is highly visual and intuitive. Too many enterprise collaboration/content management tools are cumbersome . If Bloomfire can truly deliver a simple Pinterest-like experience, it's a step in the right direction. Moreover, Bloomfire has attracted some serious VC money for a social media startup.
Market Potential and Competitive Landscape:Gartner predicts that by 2016, 50 per cent of large enterprise organisations will have internal social networks. Bloomfire believes that the content management, messaging and social enterprise markets will soon exceed more than $40 billion in combined annual revenues.
Bloomfire competes with both startups and incumbent collaboration and content management providers. These include Microsoft (Yammer and Sharepoint), Jive, Huddle, Basecamp and others. Bloomfire has more than 220 paying customers, including Etsy, Kellogg's, Comcast, Bechtel and the Make-a-Wish Foundation, and claims more than 65,000 corporate users worldwide.
What they do: CrowdTwist helps brands recognise and incentivise their most influential fans or customers, helping to build brand loyalty.
Headquarters: New York, N.Y.
CEO: Irving Fain. Before CrowdTwist, Fain ran the digital marketing and social platforms for Clear Channel Radio Digital.
Funding: CrowdTwist raised US$6 million in Series A funding at the end of 2011 in a round led by SoftBank Capital and Fairhaven Capital. kbs+p Ventures and Bertelsmann Digital Media Investments also participated.
Why they're on this list: CrowdTwist looks at customer behaviour holistically, rather than, say, just by measuring social media sentiment and Web traffic. It attempts to measure every way a customer interacts with a brand whether online, via social media or when a customer purchases merchandise in a physical store, giving businesses a much more granular knowledge of their customers than was previously possible.
A major part of what CrowdTwist helps brands discover is customer loyalty. Once the most loyal and valuable customers are discovered, CrowdTwist then helps brands reward them with unique experiences and VIP access. For example, top Miami Dolphins fans can earn the chance to run the team flag onto the field before a game.
Not only do these rewards help a brand by building loyalty, but they also trigger word-of-mouth support.
Market Potential and Competitive Landscape: There are a million and one loyalty programs out there, everything from airline mileage programs to credit card cashback programs. Additionally, companies like Belly, BadgeVille and BigDoor all compete with CrowdTwist.
CrowdTwist says what sets it apart from competitors is the emphasis not on rewards, but on rewarding the right people. Customers include the Miami Dolphins and FOX.
What they do: Evzdrop tries to cut through social media clutter by leaning on ‘place’ as a key filter. Users can get a collective snapshot of what's happening at a place of interest in real time through the people who are at the location.
Headquarters: Chicago, Illinois
CEO: David Rush, who was previously a partner at private equity firm Sopris Partners. Before that, he was a vice-president at Iconoculture (acquired by Corporate Executive Board) and a VP at PostX (acquired by IronPort).
Funding: US$500,000 from angel investors
Why they're on this list: We like the idea of a social network built on place. If you've ever wanted to eavesdrop in on one of your local watering holes (the ones with pool tables) to decide whether or not it was worth stopping in, you'll appreciate Evzdrop. Something like this could help you measure the vibe of a place at any moment in time.
Or as the PR rep wrote: "On Twitter, you follow people; on Evzdrop, you follow places. The app connects people based on a shared interest in a particular location, whether that's a retail store, gym, stadium, hotel, airport or restaurant." As opposed to chief competitor, Foursquare, you don't have to be socially connected with the people there to see what's going on.
Market Potential and Competitive Landscape:According to Gartner, the Location Based Services (LBS) market will annually generate revenues of US$13.5 billion by 2015. Main competitors include Foursquare and review sites like Yelp.
Unlike Foursquare, users follow places rather than people who happen to be in those places. Versus traditional review sites, such as Yelp, Evzdrop has taken steps to block fraudulent reviews and to factor in time. Users of Evzdrop can't post reviews once they've left, so you avoid stale reviews that don't match up with a specific slice of time.
We've all been to a place that's dead on a Wednesday evening, but absolutely hopping on Friday night. Traditional reviews don't typically capture that. Evzdrop tries to capture the feel of the place at any given moment in time. To accomplish this, Evzdrop uses geofencing technology to ensure that only people currently at a specific location can post reviews or comments. Customers include the Blue Man Group, Ruth's Chris and the Chicago Architecture Foundation.
What they do: Nestivity helps brands and individuals build communities with their Twitter followings.
Headquarters: Los Angeles, California.
CEO: Henry Min, who was previously employee number 18 at Razorfish and who later worked for Digitas, where he served in a leadership role on the American Express interactive account.
Funding: The company currently has angel funding and is in the process of seeking Series A funding.
Why they're on this list: Despite its clout in the social media world, Twitter is a big, disorganised mess in many ways. That's both a strength and a weakness. Nestivity seeks to bring some of the advantages of other social media platforms, such as the ability to create closed, tight-knit communities, to Twitter.
Nestivity allows you to curate topics and host discussions in easy to follow threads, rather than searching the Twittersphere one hashtag at a time.
Market Potential and Competitive Landscape:We're not aware of direct competitors for Nestivity yet; however, what's to stop Twitter or any number of Twitter tie-ins, such as Hootsuite, from adding a feature like this?
First-mover advantage could be a big deal here, but Nestivity will need to quickly secure the resources necessary to make that advantage pay off.
What they do: Provide a suite of cloud-based services that help companies discover and audit social media accounts. Then, once visibility is established, Nexgate helps companies protect their brand-run accounts and applications on the social Web.
Headquarters: Burlingame, California.
CEO: Devin Redmond. Before Social IQ/Nexgate, he served as the global vice -president for Product Management, Corporate Development, Business Development and Marketing at Websense.
Founded: April 2012
Funding: Just recently (on April 9), Nexgate closed a US$3.5 million Series A round from Sierra Ventures. This builds on the $1m in seed funding previously secured from Windforce Ventures, Deepak Kamra of Canaan Partners and other angel investors.
Why they're on this list: The biggest problem with social media in the enterprise is that it's become a central communication channel for businesses, yet there is a complete lack of governance surrounding it. Many brands own and run hundreds of accounts on social networks. Unlike other communication channels and infrastructure, enterprises don't have visibility into most of these accounts, nor can they enforce unified security, compliance, and acceptable use policies on them.
We've seen plenty of instances of social media missteps blowing up in a brand's face, such as the Gap's Hurricane Sandy fiasco. Fixing that problem is a big deal.
Once Nexgate's suite of cloud-based services discovers social media accounts, it helps companies audit them and wrap policies around them. This helps companies protect their brand-run accounts and applications on the social Web. The suite integrates directly into social networks to help enterprises deal with social account sprawl, account auditing, account access protection, application control and content control across security, compliance and acceptable use.
Nexgate comes with preconfigured policies that regulate data and applications and enforce archiving. Two newly added policies automatically detect anything that may run afoul of new FDA regulations for pharmaceutical companies and FINRA regulations for financial firms.
Market Potential and Competitive Landscape: The social media security market is starting to heat up. Nexgate will compete with other startups, such as Actiance and SocialWare, and don't be surprised when incumbent security vendors move into this space. Customers include Backroads Travel, Imperva, City of Memphis, Conrad Caine, Dome9, Porticor, Rosetta Stone, and WatchDox.
What they do: Provide a tool that measures social media influence, one that tries to measure the quality of a person's contributions to social media networks rather than just how frequently that person posts and how many followers he or she has attracted.
Headquarters: New York, N.Y.
CEO: Mike Fabbri, who formerly worked as a social media strategist for several luxury brands at advertising agencies Carat and Vizeum.
Founded: March 2011
Funding: US$500,000 in seed and angel funding. Investors include Frank V. Sica and Allen Cutler.
Why they're on this list: We've found that often, a high Klout score (Klout being a competitor) is almost invariably associated with the most annoying people in a particular network, those who compulsively overshare. An alternative tool, one that focuses instead on quality, is therefore a good idea.
According to Fabbri, "Influence scoring is an inept way of measuring how qualified a person is on social media. It's easy to game and usually gives undue attention to celebrities, rather than people with true talent".
Prollie's goal is to uncover qualified people to friend or follow on social networks based on your specific interests. Prollie's algorithm evaluates users based on skill, efficiency, and usage of each social network and assigns a letter grade to represent quality and talent on social media, not influence or reach. Prollie also provides a user-focused search platform that lets people search by interest, network, grade level, and location.
Market Potential and Competitive Landscape: The most direct competitors are Klout and Kred. The main reservation about this space is the fact that no one has figured out a surefire way to monetise businesses like this.
What they do: Shiftgig enables better connections between employers and job candidates in the restaurant, hotel, nightlife, and retail verticals.
Headquarters: Chicago, Illinois.
CEO: Eddie Lou, who was previously a general partner with OCA Ventures.
Founded: August 2011
Funding: Shiftgig raised US$3 million in its Series A funding in October 2012 from I2A Fund, FireStarter Fund, and Red Barn Investments, as well as prominent angels such as Sam Yagan, CEO of Match.com; Brian Spaly, CEO of Trunk Club; and Ken Pelletier, CTO of Groupon.
Why they're on this list: The verticals Shiftgig targets tend to have very high turnover. A social media tool like this could certainly reduce turnover and, perhaps, also reduce the costs associated with a high-turnover labour force.
We like Shiftgig's model and its target market. After all, most bartenders don't tend to find work on Monster.com. What seems to be missing, though--at least on first glance--is the kind of review/recommendation engine that benefits consumers of services like Yelp and even Amazon. Part of why there is high turnover in these sectors is that employees are often poorly paid and even exploited (and employers have plenty of legitimate gripes about unreliable employees too). If Shiftgig can shine a light on those problems, and then deliver that info back to employers and employees alike so they can improve, it could really have an impact.
We were initially skeptical about including Shiftgig in a roundup intended for an IT and business audience. However, it does serve as an example of just how disruptive social media promises to be in coming years.
Market Potential and Competitive Landscape: We don't know of any direct competitors. Heck, many restaurants still mainly advertise openings with a sign in the window.
Since its launch in January 2012, Shiftgig claims it has attracted more than 6,000 businesses and 200,000 job candidates. Businesses include high-end restaurants such as Graham Elliott in Chicago and Morimoto in New York, as well as casual restaurants like Chipotle. Other named users include Holiday Inn, Hyatt and the Hard Rock Hotel.
What they do: SocialFlow's products give businesses and brands ways to increase audience engagement. It also ties performance goals to the company's social media strategy.
Headquarters: New York, N.Y.
CEO: Missy Godfrey, who was previously a managing director of North Sea Partners.
Funding: US$19.4 million from Fairhaven Capital, SoftBank, RRE, AOL Ventures, Betaworks, Highline Capital and a number of prominent angel investors, including Ron Conway and Mike Lazerow.
Why they're on this list: As companies develop social media engagement strategies, two distinct challenges emerge. During the initial phase of use, businesses must figure out how to publish effective content. Later, after companies have invested real resources into their social media efforts, they need tools to optimise and manage content, and to encourage real engagement with followers.
SocialFlow relies on Wall Street-like analytics to rigorously optimise social publishing and advertising. Cadence, SocialFlow's social media publishing platform provides the data-based intelligence companies need in order to publish the most relevant information at the right time. As engagement varies throughout the day, Cadence listens to real-time conversations and helps determine which of a company's messages is most relevant to the audience in the moment. The predictive analytics used by the platform also help customers control the frequency and reach of the messages.
Crescendo, SocialFlow's "attention buying platform," attempts to find out exactly where audience attention is going to be most convertible and most cost-effective in order to execute ad buys in real time. Crescendo uses the real-time conversations of a target audience to identify key words to target outside audiences. With this approach, Crescendo can target underutilised keywords and win impressions at lower costs. To provide the highest quality targeting, Crescendo partitions the ads based on a variety of interest-based segments, rather than one-dimensional demographic filters. SocialFlow claims that by taking advantage of emerging opportunities to capture attention as interests and behaviours shift, their platform delivers high conversions at low cost with heightened brand awareness and retention.
Market Potential and Competitive Landscape:Competitors include TayKey, GraphEffect and Bottlenose. SocialFlow has an impressive customer list (Wal-Mart, Pepsi, Wall Street Journal, New York Times, Gawker, Volkswagen, and Al Jazeera), a good amount of VC funding and are in a high-growth sector.
What do you think of the list? Heard of any other social media startups that you think should be included on a future list? Email CMO's editor.