Dennis Crowley Takes Another Stab at Explaining Foursquare

It’s now two apps. It’s the location layer to the Web. It’s not a game. Well, one app is a game. It’s personal search, goddamnit! And it’s winning!

There are reasons that unicorns are rare. It’s incredibly hard to build a billion dollar company. Even if you have a great idea, execute well and draw millions of users.

Dennis Crowley knows this. He is cofounder and CEO of Foursquare, a company that — he’d like us to say — is a personal search engine for mobile users. But many people still associate the company with the distinctive and addictive game mechanics that obsessed people earlier in the firm’s six-year history. (Crowley co-founded the company in 2009 after Google shut down a similar service he helped create called Dodgeball.) To help focus users on its core mission — leveraging its knowledge of locations, including which ones its users have visited — the company last year split into two apps, an eponymous one devoted to personal local search and “Swarm,” a social app that still supports some of the traditional game functions and lets you keep track of where your friends are. Some long-time users got confused, and instead of checking in, they checked out.

But don’t count out Foursquare. While you were trying to be the mayor of your neighborhood dry cleaner, Crowley and company were quietly building a knowledge base of businesses and who visited them. They were also honing a sophisticated method of triangulating location in urban environments to uncannily understand whether you were visiting the ramen house or the bodega next store. Nobody — not Facebook, not Google— is as good as figuring out where you are at a given moment.

While Foursquare’s revenue is modest, it’s growing at a triple digit pace, and the company recently announced a new location-based ad product, Pinpoint, designed to maintain that momentum. But because of the company’s unique assets in location data and its exploitation, it occupies a critical space in the mobile mosaic — and is a constant source of takeover rumors. On the mid-April morning when we met, a tech news story was reporting, sort of, that a Yahoo purchase of Foursquare was imminent. The alleged price was $900 million, $100 million short of unicornity. One source called it a “done deal.”

Some days later, just as with the umpteen previous anonymously sourced stories reporting Foursquare takeovers, the “done deal” with Yahoo doesn’t seem done or even a deal. After six years at the helm, Crowley is still leading an independent company, determined to make the kind of big impact on the world that only unicorns can pull off. In this interview, edited for space and clarity, Crowley explains his company and his goals. We met in Foursquare’s New York City office, where conference rooms are named after badges that users win with check-ins. The room in which we spoke was named after the award for attending mutiple karaoke joints: “Don’t Stop Believing.”

[Steven Levy] Where’s Marissa?

[Dennis Crowley] I thought we were going to be able to skirt that. As you know, we don’t comment on rumors.

Since Foursquare provides a layer of context to maps, it does make you a valuable potential asset for Yahoo or some other big company.

We never thought of ourselves as a mapping company because we don’t have the street segments, we don’t have the routing. But we do have all the stuff that goes on top of the maps. We have the dots. We have this idea that my map of the world should be different than your map of the world, because I’m interested in different things than you are. All the Google Maps tiles are the same. All the Apple Maps tiles are the same. If the two of us zoom into Soho, they’ve decided that we’ll both see the Banana Republic and the Prada store and the Chipotle. But maybe your dots should be different from my dots, even if you’re not searching for something. Our big differentiator is that we have a contract with users that basically says, “Tell us where you’ve been, and we’ll tell you about great places.”

That’s a different model than you had originally with Foursquare.

In 2009, we knew what we wanted to build. I’d be sitting at my desk at Google and going through the MySQL database that was Dodgeball at the time and running queries that would say, “Show me all the places in the East Village where people check in on weekends between 11:00 and 2:00, and then rank them by popularity and remove the ones that I’ve been to.” It was very slow — it took like 45 seconds to run because I’m a lousy engineer. But it would come back with a list of all the places that I should go to for brunch. And we had this epiphany at our desk at Google — someone needs to make this service. We knew that the only way to get that was through this check-in data. So when Google said they weren’t interested in Dodgeball, which we couldn’t believe — to me, it was very clearly the future — we left and we said we’ll build another check-in engine, and then we’ll accumulate all this data and make this awesome personalized local search engine. And we’ve done that.

Lots of people were surprised when you purged games from your flagship Foursquare app—was that something you wanted to spring on people, or a case of ineffective communication?

A mixture. One of my proudest moments at Foursquare was March 2011 at South By Southwest. In my keynote there, I described it as if we just pulled a Mr. Miyagi on you guys. You think that you’re checking in to get points and badges — and meanwhile we just made an awesome personalized local search engine for you! You think that you’re washing a car but you’re really learning karate! This is what we wanted to do all along. From that moment, Foursquare was about search and recommendations — a smarter search engine that learns about where you go. But by that point, people were so into the game stuff that they either couldn’t see or didn’t see it.

So how would you describe the main app Foursquare?

Personalized local search. Foursquare learns about the places that you go to, and based on that leads you to other places. The only thing you need to do is take your phone to places, and we can learn that the phone stopped at this place and then it moved and then it stopped at this place and then it moved and then it stopped at this place. So you can have this check-in thing going on in the background. We’ve made this awesome map where, no matter where someone is, we can snap them to a place name with a high degree of certainty.

I’m always impressed by how Foursquare does this, but I’m feeling there’s value in it that I’m not tapping here. What am I doing wrong?

We’re trying to beat people over the head with the message that everything you do on Foursquare teaches us something so that we can help you plan the next move better. And I don’t think people get that. We have something in every search result we call the justification — why should this user go to this place at this moment? If you search for breakfast, we’re going to show you a list of breakfast places. Yelp will also show you a list of breakfast places, but we tell you to go to this place because your friend Laura has been there three times, or because its popular with locals, or because it’s similar to Balthazar, the breakfast places you go to in New York.

I have to say that this wasn’t all that clear to me. I had to talk to you to figure this out.

I know, I know. We’ve never done a good job telling the story. We’ve never really embraced any forms of marketing and I think that’s a weird thing for a company that’s six years old. We just hired a VP of Marketing, and she’s had us run some outdoor ads, we are doing some digital ads, we’re sending emails now, we have much more targeted campaigns, we have a real strategy for how we’re gonna tell our story.

What’s the future of Swarm? I know a lot of people who used to check in with Foursquare now don’t use that app.

We wanted to ditch the image of Foursquare being a toy, something that lets you play games. Now that we have the two apps, like, each app can tell its own story. Foursquare can tell the story of this awesome personalize-able search and Swarm can tell the story of this fast, easy, fun way to check in. If anything, I think we did not make Swarm as fun as the old Foursquare was— we screwed up a couple things. Now we have a team of people working to dial the fun in Swarm back up to eleven.

Will you be on the Apple Watch?

We will be, yeah. We built something we feel really, really happy with. I’ve always thought that Foursquare’s very best magic trick is our ability to sniff out when you walk into a new neighborhood, when you walk into a new place and to figure out if we have something to tell you about that specific place. We do that really well. Now we’re going to tell a pretty aggressive story about [how that will work for the Apple Watch]. We put together this microsite and we’re gonna start emailing our users, telling them that if you’re getting a watch, you have to make sure you have Foursquare and adjust your settings just right so you get these notifications.

Foursquare on the Apple Watch

Right now Facebook doesn’t do location as well as Foursquare, but it’s improving. Meanwhile, you have a deal with Twitter that extends your technology to a company that has more users. Are you trying to consolidate your lead now?

The Twitter deal is mostly a data licensing opportunity for us. Twitter wants to be able to geo-tag tweets. They looked at a wide variety of companies that can provide it, and I’m really excited that they chose us, so now we have a relationship that is generating opportunity for us.

Will Facebook catch up?

I don’t know how many hundreds of people Facebook has on this, but it obviously wants to succeed at geo stuff. Facebook can build this stuff all day long but every time they put it in their app it gets lost, because there’s just so much stuff going on there. And then every time they launch a spin-off app, they haven’t been successful. When you think about the landscape of who has interesting assets in geo, we’re one of the last independent companies out there that continues to build this stuff. That’s pretty amazing.

Your independence makes you quite a chip for a potential acquisition, right?

Yes, but that’s nothing new. People have always been speculating about what’s going to happen to us. Do we live on as an independent company that IPO’s some day, or do we end up as part of another company and help make their offering stronger?

So what’s in your head? Are you now more determined than ever to be independent, or do you feel as part of a bigger company you can fulfill your vision without pressure from investors?

The thing that’s always been driving us is the idea that some day hundreds of millions of people are going to use [geo-location], and they should use stuff that’s powered by Foursquare. We could continue doing it independently or we could do it in partnership with another company. The thing I think about most often is how do we make stuff that hundreds of millions of people use?

Siri will have a version of this and I don’t think it’s going to feel right. It’s not going to be the thing that we would build. Google Now is trying to do some of this but it is not the thing that we would build. We will build something that’s fun and playful and flirty and kind of snarky. If we don’t build that thing, no one else is going build it. So we should continue building it, right? That’s what I tell the guys here. If we don’t build this thing, someone else will try to do it and they’ll screw it up. And then our vision of what that thing is supposed to look like will never exist.

Who else besides Twitter do you have similar deals with to share your geo technology?

We have a deal with Microsoft to build contextual and location awareness into Windows products — and Cortana. Their vision for Cortana is very similar to my vision for how Foursquare will act some day.

So Microsoft could be a potential place you could reach your hundreds of millions?

It could, yeah. At some point we’ll have to make those decisions. Right now that’s not something we’re focused on.

You don’t feel there’s any clock ticking?

I don’t think so. We’re doing some of the best work we’ve ever done right now.