This question originally appeared on Quora: What has changed between now and 2010 that makes Yahoo consider buying Foursquare again?
Answer by Jonathan Brill, Start-up specialist, Seller, Marketer, on Quora
I don't believe Yahoo! is buying Foursquare. But if they were, it wouldn't be the most shocking they've done, and it would make more sense than buying Tumblr or Flurry.
In 2010 Yahoo was worth a fraction of what it's worth now and had some hope, albeit slight, at leveraging its still massive audience into a neat social play to compete with Facebook (after failing to acquire it for $1b). But that never happened and 5 years later, it has much less hope, a much smaller audience, another CEO on the hotseat, and no real social or mobile presence. Yahoo looks like a company still looking for a direction. But really valuable tech companies aren't designed to play catch up; the multiples these companies get is for the future and without the multiples, its much harder to compete for good talent.
So why Foursquare?
Foursquare isn't growing, seems to have been terminally stunted by Facebook and Yelp, and it has limited opportunities to pivot into a new social play given it's brand history. But it does have data! And there's still something like 55m people using it, mostly from mobile, to check in and, I'm assuming get rewards.
It's difficult to think of where Yahoo! could find a single company that checks so many of the boxes they care about: mobile, social, eCommerce, targeted ad data. And although Foursquare has been unable to effectively grow it's userbase for either of its two apps, Swarm and Foursquare, it's not crazy to think that integrating these into the existing userbase of Yahoo! apps, such as their sports, messaging, and news apps, would give Foursquare new life and if nothing else, could give Yelp a run.
Why not Yelp?
On paper, Yelp seems to make a lot more sense than Foursquare. For one thing, it doesn't seem to be almost out of money. It's already public, it has much steadier revenue, and it's significantly better in all those areas I mentioned: mobile, social, eCommerce, and targeted ad data.
But the one thing Yelp has that Foursquare doesn't have is a complete dependence on people wanting to write timely new reviews for strangers, and people wanting to read reviews from strangers. It turns out that writing reviews for strangers isn't as social or as fun as doing it for friends, and that maybe people are starting to discount reviews from anybody they don't know personally. Writing a review is way more work than checking in, and Yelp's relationship with businesses isn't always great, it's sometimes contentious. You'd have to think Yahoo! would be ambivalent about investing almost $4b in Yelp so it could advertise to businesses that feel exploited and harassed.
Compared with Yelp, Foursquare might not look so bad.
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Answer by Martijn Sjoorda, Change catalyst, husband, father, writer, on Quora
In 1998, I was a young product manager for AND International Publishers. The first generation of "mobile" devices was just coming to the market. I was assigned a small team and we built two products (a routeplanner and a flights guide) for the first generation of Windows CE, and Palm O.S.
As part of the process, I wrote a one pager with a scenario for what would be possible if we went truly mobile.
At the core were location based services. I can't find the one pager anymore, but most of it took longer than I expected but has become true.
Chiming in with Jonathan Brill's excellent answer, the value prop that Foursquare holds is a sizable installed base and a boatload of potentially relevant data in the context of location based services.
I think it is unlikely that Yahoo! will buy Foursquare, because they have a pretty full agenda with other priorities.
However, seeing that mobile is continuing to grow and, certainly in emerging markets, is simply bypassing desktop based use of Internet services, if I was Marissa Mayer, I would figure out what my go-to mobile strategy was.
As part of those discussions, I could also envision a team of biz dev, product managers and engineers spending a day or two offsite tinkering with Foursquare's data set and seeing if there is a flip on the business model they could see work. That might (note the trepidation in "might") lead to a suggestion to acquire them.
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