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Foursquare, Quora, Path: What Becomes Of The Underachievers?

Foursquare, Quora, Path. Each is (or was) a Valley darling; each has millions of loyal users; each has raised more than $50 million, albeit nontraditionally, and been valued at $400 million or more — and each has recently done something remarkable. Foursquare and Path pivoted, hard. Quora, bizarrely, joined Y Combinator.

Are they just flailing, or is there method to this madness?

Foursquare, which started life as “the check-in app,” is ripping check-ins out of its eponymous app and moving them to its new ambient-social app called Swarm. What’s more, it’s planning to start charging for heavy use of its API, which is much beloved by third-party developers (including me.)

Which leaves it seeming more than a little unfocused. The main Foursquare app has essentially become a Yelp competitor. Swarm is now a side business, presumably because check-ins are no longer a growth industry, and haven’t been for some years now. Foursquare is allegedly on course to bring in $30-$40 million in revenue this year, which sounds good — but is not a lot for a company which has raised more than $160 million at valuations north of $600 million … if its growth has slowed.

Path, the mobile social network whose superb design wowed the Valley some years ago, before it began to look like a beautiful solution in search of a problem, has pivoted almost as dramatically. First they ripped a page out of Snapchat’s book and suddenly retroactively made all Path messages ephemeral. A week later they launched a new messaging app and acquired consumer-to-business messaging service TalkTo.

Again, an odd sudden change of direction for a four-year-old company which has raised $65 million. Everyone loves messaging apps today, in principle, thanks to WhatsApp — but the world already has Line, Viber, Kik, Snapchat, WeChat, Tango, etc, to say nothing of Facebook, Twitter, and Skype. It’s hard to see how (maybe) the sixth-place social network, which has struggled with layoffs and executive exits, benefits from branching out to become (maybe) the thirteenth-place messaging app. But Path has to do something … if its growth has slowed.

Quora is the strangest case of all. Why join Y Combinator? I mean, it didn’t cost them much, and it’s nice that it’ll be “fun personally to participate” for Adam D’Angelo, but how is it anything other than a distraction? “We’ll have Sam and all the other partners to help us,” D’Angelo says, without specifying what kind of help they want.

I think we can all make a pretty good guess, though. Quora was recently valued at some $900 million, but as Josh Constine puts it:

Quora has been cagey about its stats since forever, only talking in relative growth and vanity metrics rather than absolute user counts … This makes it tough to know exactly how popular it is, but the general consensus hovers around “known amongst Silicon Valley intellectuals” and “just not big enough”.

Joining YC might seem weird or even desperate, but weird or even desperate is actually the right move for Quora … if its growth has slowed.

You might be noticing a theme here.

As Paul Graham once put it: “A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup.” But, similarly, just because you’re “late-stage” — big, massively well-funded and relatively mature — doesn’t mean you’re not a startup. A corollary of Graham’s definition is: if you need to grow fast, then no matter how big you are, you’re still a startup … meaning you’re still extremely vulnerable.

Foursquare, Path, and Quora don’t yet have mature business models lucrative enough to justify their funding and valuation. Meaning all three are still startups, and have no choice but to keep growing, fast. That’s a huge challenge. It’s relatively easy to double a userbase when it numbers in the thousands; much harder when it’s already in the millions, unless you benefit from network effects. Doubly so when you’ve lost your cool and become yesterday’s news, no longer the talk of the Valley’s chattering classes:

Does it sound like I’m being hard on them? That is not my intent. All three companies have done genuinely extraordinary things. They have scaled from scrappy outsiders into significant players. They have millions of faithful users. While it’s true they have succeeded well within their founders’ wildest dreams, they are still among the best of the best, or they wouldn’t have gotten to where they are today.

But the lesson here is that even that’s not good enough. Not if you stop growing before you start making money. Today’s tech industry will eagerly accept hypergrowth in lieu of revenue, but it will not accept neither. If you’re not yet raking in money, then you must grow, and keep growing, fast … or suffer and eventually die. And the bigger you are, the harder it is to keep riding the hockey stick — and the harder you fall if you fail.

Goodbye, With. Hello, Path 2.

Dave Morin and Path’s secondary standalone app With “is winding down”, according to a tweet, email, and blog post from Path. “Now tweet who you’re with directly from Path”, the email explains. The encouraged migration signals the end of Path’s experiment with a stripped down, single feature experience.

Path’s blog posts says “After a long and friendly coexistence, two apps have become one. And the pair has settled on a name: Path 2.” With’s end just 6 months after its launch resurfaces the standalone vs comprehensive app debate. Companies have to decide whether their apps should provide many functions but bury them in menus, or offer rapid access to one function.

Path recently released its more comprehensive 2.0 update, which has led to 30x growth of the app’s user base. Rather than force users to waste home screen space and choose what they want to do first, Path 2.0 simply integrates With’s functionality. In addition to tagging who you’re “with”, you can share your sleeping habits, music, and now standard content like photos and location.

Morin’s former employer Facebook is moving in the opposite direction. This summer it released its standalone Messenger app based off of its acquisition Beluga, and we hear it’s still working on its standalone mobile photos app that leaked in June. I see this as a slippery slope where instead of bloat you get a fractured experience.

I like comprehensive apps that let me bounce from once use case to another without having to exit to the homescreen, so I’m happy to see With go. Often times the functions split between apps are highly related, and saving one extra click through a menu doesn’t seem to warrant downloading and updating an extra app. The With sunset will also keep Path’s team focused on building a distinct experience from Facebook and Twitter where you share a lot but to only your closest friends.

With: Path Inc’s Own Take On Mobile Photography

Path, the developers of the eponymous app for the iPhone, has come up with a mobile check in app with a focus on who you’re with. In their original app, Path, the developers focused more on sharing a picture or moment privately with a select group of friends. At a recent hackathon, the company saw that their users also wanted to selectively share their moments on public social networks, such as Twitter. They also saw a great demand for users tagging who they were with when sharing these moments. This is where the idea for With was born.

The core concept of With is as if you took the main features of Foursquare, Twitter and Instagram and combined them in a streamlined app. When you first install the app on your iOS device, it automatically asks for your Twitter login so you can post to your account and tag friends you are with. It also suggests friends who are also using the service.

When you’d like to share who you’re currently “With”, you are presented with a simple screen to tag who you’re with and what you are doing. You are then presented with the option to take a picture to document the moment. The picture is optional. It seems the developers are emphasizing who you are with. This then gets posted to your Twitter feed with a link to your picture.

This clearly takes features from other social networks, so why use With? The company says the service rewards friends who you are with the most often. They rise to the top of your profile when viewed from within the app. The company also has a couple of features coming out soon that will reward these close friends.

With their original app, I had a hard time grasping the appeal of Path, but with their latest project, I feel they have the right features, interaction and simplicity to keep users interested and using their service. It combines the check in features of Foursquare with the photo sharing features of Instagram in a simple app. You can read their announcement of With on their website and download the app on the iTunes App Store.  Let us know if you like it in the comments below and tell us if this is something you could stick With.