Social media sites are at the forefront of ‘Web 2.0’. Janie Lewis looks at five of the most widely used social media websites and their founders – how they started out, what their businesses actually do, and how much they’re worth.
1. Mark Zuckerberg
Number of users: 550 million
Still a matter of legal contention. Mark Zuckerberg, a dentist’s son, created the prototype, Facemash, in his Harvard dorm, purloining pictures of female students by hacking into the university’s computerised year books, and inviting votes on who was the “hottest”. Soon after, brothers Tyler and Cameron Winklevoss (6ft 5in identical twins, both rowing stars) invited him to write the code for a new dating website. They now claim he “stole” their concept and turned it into Facebook. Zuckerberg denies this, but nonetheless paid the twins a reported £43m in a 2008 out-of-court settlement. They are now appealing for more. Facebook went live in 2004 and spread with viral speed across US campuses and into the wider world.
Originally devised as a social club, noticeboard, and computerised confessional, the aim is to make Facebook the central hub of all its users’ online activities. In September 2009, the site turned cash positive for the first time. This year, it expects to make revenues of $1.2bn-$2bn, mostly from advertising. The company continues to develop new applications – it is reportedly working on a physical location-sharing tool. There are also reports (denied) that it is to build its own phone.
Wall: The centre of a Facebook user’s profile, where users can add new photos, videos, comments, etc. You message friends publicly by “writing on their wall”. Status: A message updating your friends about what you’re doing or thinking, transmitted via a newsfeed feature. Tag: A way of labelling friends in photos and notes. Tags are then linked. Poke: A virtual nudge, typically used to say “hello”. Unfriend: To remove an undesirable from your list of friends.
The lowdown on Zuckerberg
He is reportedly incensed by the Hollywood version of the Facebook story, The Social Network, which portrays him as a scheming back-stabber, motivated by romantic rejection and social exclusion. As a PR riposte, he invited Oprah Winfrey’s cameras into the modest rented home he shares with his girlfriend in San Francisco. Zuckerberg, who works 16-hour days, is more ‘dorkish’ than his screen alter ego. But he finds it hard to downplay a cavalier reputation. Once asked why users were willing to upload so much personal information onto Facebook, he said: “They trust me… dumbf***s.” He says he’s “grown up” since then.
Moments of glory
At 26, Zuckerberg is the youngest self-made billionaire in history with an estimated worth of $6.9bn. Given the power over data he wields, some have dubbed him the most influential figure on the planet.
Facebook’s culture of sharing personal data on the web has raised privacy worries, not helped by its policy of forcing users to opt-out of data sharing, rather than opt in. A backlash this year forced a policy reversal and the issue of simpler security controls. Facebook Beacon (a tool broadcasting online purchases to woo advertisers) was pulled after protests.
Microsoft’s 2007 purchase of a 1.6% share of the firm for $240m gave it an implied value of $15bn. In June 2010, an online marketplace for trading private firm stock reflected a value of $11.5bn.
2. Dennis Crowley
No. of users: 1m (April 2010)
Foursquare – started in March 2009 by Dennis Crowley and Naveen Selvadurai – is part social city guide, part friend finder. It uses your phone’s GPS to alert Twitter and Facebook contacts when you arrive at a location.
Checking in: Registering your arrival at a venue. Badges: Awards earned when you check in to new venues. Mayor: The title for being the most frequent visitor to a given location.
The lowdown on Crowley
Friends say he’s “highly competitive”, loves games and doesn’t like to lose. He hosts an annual Christmas party: BYOTTHOTMFT (Bring Your Own Thing to Hang on This M-F**king Tree).
Retail and leisure firms, such as Starbucks, are embracing FourSquare as a marketing tool, so it should move into profit fast.
Moments of glory
Crowley was dubbed the “new king of social media” by Wired in July.
Regular check-ins make it easy for cyber-stalkers to threaten targets in real life.
Valued at $80m in April.
3 Jack Dorsey
No. of users: 105m as of April 2010, adding 300,000 accounts per day
Born in August 2006, Twitter was the idea of Jack Dorsey, now 29, a software geek since childhood who’d already invented a messaging app for broadcasting the status of taxi and despatch journeys. Why not, he thought, make it personal? The concept of micro-blogging was born.
Dorsey honed the service with fellow techie Biz Stone – bankrolled by a third co-founder, former Google executive Evan Williams. Twitter was an instant hit, spread by word of mouth.
Tweet: a message, a maximum of 140 characters in length. Follower: someone who signs up to read your tweets. Timeline: Your homepage on Twitter which shows the messages you send, and those from the people you’re following. Hashtag (#theylooklikethis): notes attached to tweets so they can be grouped and searched for by topic. @: a reply to someone else’s Twitter message eg. “@: merrynsw, has the last bear turned bullish?” RT: short for “re-tweet”: a message that is repeated because someone thinks it’s particularly good.
A long time coming. Evan Williams once joked it had fallen down the back of the couch. The new CEO Dick Costollo’s main strategy for “monetising” the free service is ‘promoted tweets’ in which advertisers pay for the number of times a sponsored tweet is viewed. It’s not yet clear if it will deliver.
Moments of glory
The 2009 Iranian election, when Twitter emerged as a vital opposition weapon, shrugging off its reputation as a mere toy for online flirtation.
When the succinct beauty of tweets was hailed as a new art-form, comparable to Japanese Haiku poetry.
The usual anxiety about privacy/commercial exploitation – though no big scandal yet. Twitter evangelist Stephen Fry being so stung by the slur that his tweets were “boring” that he stopped twittering. He was soon at it again.
The lowdown on Dorsey
A serious-minded chap. He peppered a recent speech with references to his childhood growing up in St Louis, his fascination with maps, and the shopping trips he’d made with his mother to buy handbags. He still cites her as his favourite Twitter user. Now working on a new start-up: Square – a mobile phone payment service.
Unknown. Twitter remains loss-making, but the rumoured IPO might be valued at $5bn plus.
4. Reid Hoffman
No. of users: 80 million in September.
Hoffman, 43, was an early mover in social networking, starting his first firm, SocialNet, in 1997. A founding member of Paypal, he started LinkedIn in 2003 as a networking forum for business professionals. It’s evolved into a powerful recruitment site.
The lowdown on Hoffman
The “most connected man in Silicon Valley” is a serial seed investor and director, boasting strong relationships with many of the central players in Web 2.0 – a term that some say he invented. A Stanford graduate, he took a masters in philosophy at Oxford and thought he’d become “a public intellectual”. But ultimately, Kant took a back seat to business building.
Already profitable, thanks to fees, payments from recruiters and advertising sales. Predicted revenues of $205m this year. While it still grabs half its members from the US, it is recruiting fast in new territories such as Asia.
Moment of glory
Becoming the de-facto global business networking site, far outpacing early rivals, Viadeo and Xing.
Allegations of snooping. LinkedIn insists its algorithms can only make connections from the contact lists users choose to import. But some report the mysterious appearance of names – from different industries and countries – with whom they have had no contact for years, among their ‘people you may know’ suggestions.
Estimated at $l.25bn a year ago.
5. David Karp
No. of users: 7.2 million as of August 2010.
Founded by New Yorker David Karp in 2007, Tumblr falls between full-throttled blog software, such as WordPress, and micro-blogging tools such as Twitter. Users post quick multimedia posts, creating online journals of photos, video, music and text – and “follow” others in the same way as Twitter. Easy to use. Total cash injections to date: $10m.
Tumblelog: A multi-media blog, ideal for quick posts. Tumblrspeak: Social argot used by Tumblr bloggers.
The lowdown on Karp
At 24, Karp is the “Barely-legal blogfather” of one of the web’s hottest sites. The son of a musician, he was coding Apple programs from childhood. “Most of the good decisions I’ve made I can credit to the smart people around me.”
Small, but growing. The main focus is on attracting new users (Karp aims to woo musicians from MySpace and artists and producers from YouTube). Vehemently anti-advertising; expects to make money by customising its platform for big media firms and charging users for add-on services.
Moment of glory
When President Obama picked Tumblr as one of his top tech tools.
The number of users who blog they’re “over” Twitter doesn’t go down well with the latter.
Last valued at $14m.