Meet The Entrepreneur Whose Company Is Inventing The Future

I invited Dennis Crowley to Mixergy because I think he sees the future and then invents it.

After he and his friends lost their jobs, he co-founded Dodgeball as way for them to tell each other where they were so they could meet in person. Back in the days before everyone had a smartphone he found a way to make it work. It was ahead of its time, which is why Google bought it. But Google let the project die.

That’s when Dennis struck back and created foursquare. Not only are early adopters crazy for this mobile app that helps them find their friends, but as you’ll hear in this interview, it’s getting enough interest from local businesses that foursquare might end up building the holy grail of local advertising: an ad network that will show you coupons for local business as you’re walking past them.

This technology is still in its early days, but I asked Dennis to talk about how the idea evolved and why it’s finally starting to catch on.

Dennis Crowley

Dennis Crowley


Dennis Crowley is the co-founder of foursquare (with Naveen Selvadurai), a service that mixes social, local and gaming elements to encourage people explore the cities in which they live. Previously, Dennis founded (with Alex Rainert), one of the first mobile social services in the US, which was acquired by Google in 2005. You should say “hi” to him on Twitter.



Full Interview Transcript

Andrew: All right, before we start the actual program I want to spend less than 60 seconds telling you about Haystack. Haystack is the place where you’re going to find the right web designer for your next project. I’ve been telling you about all the different things that I love about Haystack including the fact that you can see big pictures of past work from each design firm that you’re looking at. I want to show you what happens after you find one that you like. Let’s suppose that you like this company Fresh Tilled Soil. You can see what they charge, their typical budget. You can read a little bit about them. You can see big pictures of their past work. Really clear what they do and what they’re like. Let me show you on the bottom, here’s what I want you to see. Not just a link to their website but their actual email address. Haystack is not standing between you and the design firm that you hire. They are just letting you connect directly. You can email them, you can have a conversation with the firm. You can decide whether you want to work with them or not. And if you don’t want to work with them, well, tons of other companies on Haystack that will help you that will design your next project for you. Here’s the program.

Hey everybody it’s Andrew Warner founder of home of the ambitious sub star and I’ve got with me one of the revolutionaries. He’s smiling because he doesn’t believe it the way that I do. I was going on a rant here earlier about how you’re a revolutionary in mobile location based technologies. Let me introduce him first of all since I keep talking about him. Dennis Crowley is the founder of Foursquare. This is his second company that’s in this space. Dennis can you tell people what Foursquare is?

Dennis: Yeah, sure. So we’re building things for mobile phones that make cities and really dense areas more interesting and easier to explore. So part of it’s a friend finder so it’ll let you know who your friends are. Part of it’s we’re trying to build a smarter city guide. So we can recommend places that are nearby and filter out the places that you’ve been to and the places that you haven’t been to. Then we mix a whole bunch of Game Mechanics in there too to serve as some kind of, like incentive or motivation to do things that you normally wouldn’t do. Now we’re based out of New York. There’s five of us on the team right now and you know, we’re available, I think, in just about 50 cities now.

Andrew: By the way before we continue, do you have any programs running in the background that might suck the processing power out of your computer? itunes? Word?

Dennis: I have some. I’ll close some of them down, hold up a second.

Andrew: All right let’s do it.

Dennis: A lot of it is I’m on this shared internet here and it can be a little bit rough.

Andrew: Okay, so far we’ve been doing okay. I just want to make sure we continue to look this good. So you’ve wanted to do this for a long time. Did the original idea come to you when you were back at NYU?

Dennis: The Dodgeball stuff?

Andrew: Yeah. I mean where did the idea come from to do mobile or where’d the passion come from to do this?

Dennis: Yeah the Dodgeball stuff has been around. Those ideas have been around since, like, 2000 or so. And a lot of them stem from, like, my very first job in New York was at this direct company which, you know, we all got laid off around the same time. These were my only friends, you know my poor group of friends in New York. We weren’t working together. We weren’t at work together. We weren’t hanging out after work together. So when we wouldn’t have jobs anymore there’s no more socializing. So, you know, what we built is just like a very basic way to be like well, I’m laid off, you’re laid off, let’s meet in Central Park. I’m at the park, or I’m at the bar, or I’m over here. And it was just, you know, it’s like putting on a bat signal so people could come and find you. And, you know, this is way before things like Friendster were around, even very early social networks and it was very difficult to explain to people. It’s mobile, it was social, you could have friends lists which no one was doing at the time. So it didn’t really gain any traction. It didn’t pick up traction until around 2003, 2004 when I was at ATP this grad program at NYU with my buddy Alex. And, you know, were able to reinvent some of the Dodgeball stuff in the context of, hey it’s like Friendster but for cell phones. Once we started doing that [??] we were able to reach a wider audience.

Andrew: I see, so the first site, or the product that you built, was it a public product? Or was it just for you guys?

Dennis: No, well, it was a public product it was just there was nobody using it you know? The very, very first version of Dodgeball it was a city guide. Kind of like and the only thing it allowed you to do that was different, you could add your own places, you could write your own reviews, which at that time was like a big idea. It’s like before a lot of the user generated content. And then, you know, later we just tweaked it a little bit so that you could, you know, we had this list of places in New York and you could check into those places and say oh I’m here, or I’ve been here. And when people started doing that in real time, that’s what a lot of our work at NYU was about was seeing, hey if we can convince 1000 people to tell us where they are on a Friday night does that make Friday more interesting? Or does that make it more awkward? Or, like, how does that whole thing work out? And that was a lot of what Alex and I were trying to do with our thesis. And that’s all, you know, the features that were built into Dodgeball were initially from what we were finding as we were letting our 50 or 100 friends in New York play around. Well, sometimes people check in early, sometimes people check in late, sometimes people check in a lot, sometimes people get in a cab and meet you where ever you are. There are all these weird things about privacy and the dynamics of different social connections like who you want to connect with, who you don’t want, and whose feelings [??]. All of these things, we just worked through with Dodgeball.

Andrew: I see. Was that first product called Dodgeball too?

Dennis: It was a domain name that me and some buddies from college bought back in 1998, and we used to use it just as our personal blog to post stories of ourselves. I started working on this city guide stuff in 2000. I let those guys know that I was going to use the name for this other product, and we’ll all get our own domain names by then.

Andrew: I see.

Dennis: Dodgeball has been four or five different projects all under the same name, because it was the only domain name I had.

Andrew: Did you have to buy them out of that ownership of the domain name?

Dennis: No, I’m still friends with those guys. They are my buddy Josh and my buddy Brian. I think I was paying the hosting the whole time. So I said, ‘Listen, I payed the hosting. You can either give me $500 for 3 years of back hosting, or we can just call it even.’

Andrew: I see. Wow. Great deal. One of the deals of a lifetime.

Dennis: Well, I mean it’s the domain name like [??] that.

Andrew: So, your original goal was to create a city guide like Citysearch, Yelp, Yellowbot, that kind of thing.

Dennis: Yes.

Andrew: It was only when you said, ‘How do we get people to add locations.’ You realized by having them check in. That’s the way to do it.

Dennis: Yes. The purpose of creating the city guide was because Citysearch couldn’t keep up with how quickly New York was growing at the time. We were hanging out in these neighborhood [??] every month or so, and Citysearch couldn’t keep up with the names and addresses and such. Well, we’ll build something that can keep up with these neighborhoods, and then people will be able to write their own reviews. It’s so amazing, because every site offers this. To us it was a big thing at the time.

Andrew: You mentioned something earlier…

Dennis: [inaudible]

Andrew: I’m sorry?

Dennis: Oh, no. Go ahead.

Andrew: You said earlier about ITP graduate program at NYU, right? What was that program like before we get into what you were doing with it?

Dennis: So, ITP is a tough program to explain, but it’s a graduate program. It’s two years. It’s based out of NYU’s Art School, School of the Arts. They take about 100 kids per year. It’s a two year program. So, there’s about 200 people there. It’s a mix of an art school with a big basis of technology. You’ve got people there creating hardware, and some people are creating digital installations. There are people that make musical instruments. There are people that make little robots. There are people that design social software. There is a little bit of everything. It’s a really crazy place, and it’s in this loft in the middle of Manhattan. The program was started in the late 70’s. It first started for TV. It was exploring interactive film and interactive television then a lot of telephone. They started putting in CD Rom and the Internet. It just keeps morphing over time. Even in the couple years since I’ve been involved, it was big on websites, then mobile, then voice over IP. Now there is gaming stuff going on and a lot of social media. It changes every year. It’s a fantastic program.

Andrew: I remember that whole part of NYU being for the artists. The people who would walk in with green hair and piercings everywhere. It was the eclectic group. I went to Stern, which was the kids who wanted to be business people so badly, they would walk into school with a briefcase.

Dennis: Sure, yes. It’s still like that in a lot of ways. What is interesting now, is there is a lot of overlap between Stern, the business school, and what goes on at ITP. We’ve got people with amazing ideas at ITP that are not thinking about turning it into a business. At least they are starting to get connected with those folks. It’s like, ‘Oh, you could manufacture this product, or you could create this clothing line, or you could raise money for this start up.’ So, those types of things are happening more and more often now.

Andrew: By the way, this is the first live interview that I’ve done from Buenos Aires. If you’re watching this live, I would love any feedback on how it’s coming through for you. How’s the audio? How’s the video coming in? Any input that you can while you’re watching this live would be helpful. OK. So you’re in this program, what did you want to study there? How does this business, Dodgeball, integrate into a program at school? You’re the first person to even tell me that school has helped entrepreneurship for you. Did I lose you just as I was asking how bad the technology was?

Dennis: Yeah, it sounded really strange. Why don’t we try that one more time?

Andrew: OK, sure. I was saying, so how did ITP, what did you do with Dodgeball at ITP? How did it help you think it through?

Dennis: [inaudible])was in the two year program. And I think the first couple weeks I was there, I met up with Alex Rainert, the Dodgeball co- founder, and it’s an arts school, and I think we felt that we weren’t really artists, and we were trying to figure out how we fit into ITP. He was coming from Razorfish, and I was coming from a startup, and you know, we started just doing our little brand of product development stuff at ITP. And so, we started making things like, we did some experiments with creating social jukeboxes that knew about the people that were in a room. We did stuff about presence detection, so you could tell which of your friends were at, they call it “the floor,” but were at the program at the time. And you could leave notes for them, and we built them a little gossip tool. Just little fun experiments. In our second year, around the same time that Google started coming out with a lot of their mapping products, GoogleMaps (inaudible [1:35]). You know in the very early days of Flickr, right when Facebook was starting and Friendster was starting to really pick up some momentum, the same thing with MySpace, it’s like, no we could probably reinvent the Dodgeball stuff and have a little bit more success, because everyone knows what this stuff is now. And so we just started working together, and eventually we turned it into our thesis project. We worked on it for… I think we graduated in 2004? May 2004 and we said, “let’s give ourselves six months to work on this, because maybe it might turn into something.” And then in that time, we ended up meeting with the people at Google and decided to bring the project over there.

Andrew: OK. Did the ITP program give you any help in thinking it through? What kind, it sounds like you guys were developing it yourselves.

Dennis: I’ll show you.

Andrew: What kind of input did they give you? What kind of support?

Dennis: It was the real early days of social software back then, and we were taking, I think that was the first time, you know Clay Shirky? Clay Shirky was teaching a class just called “Social Software,” I think. And he knows this stuff better than anyone else. He was basically teaching a room of 20 kids that were just building stuff over and over and over again with everything that he knows about social media. And the way that NYU was structured at the time, that particular class was designed where you were building things specifically for your classmates. And so people were building, in our class, someone had built a tool for making group orders of Thai food or Chinese food or something. So if one person was eating, everyone could eat. Our project was one where you could leave notes for people and kind of gossip about people on the floor based on little avatars, kind of a cyworld type of thing, but before that stuff was out. What else was there? There was a shopping tool that someone put together. Like, “Hey, if someone’s buying a couple microprocessors that they need for their project, we should get a whole bunch of other people on top of that to get a group discount.” But just little experiments in social, not even social media, but harnessing the power of groups to do things online. Alex and I would sit around on the white board and draw things all day, and we’d run them by Clay and Anthony Townsend and there was a bunch of other professors that were really helpful in solidifying a lot of the ways we were thinking about things. All the Dodgeball software was built at ITP. I spent two years sitting in this building. All my free time was there in the lab, plugging away, and drawing stuff on the wall. It’s a really amazing place. I was just here the other day. One of our investors, Ron Conway, was in town and MC Hammer was with us, and so I brought them over to NYU, and like listen, “I know you guys are tight for time, but you have to come over and check out what NYU looks like, what the ITP program looks like, because it will blow your mind.” And they’re like, “All right, we’ll take a look.” Once you bring people up on the floor and have them look at, there’s all these student projects, there’s a whole bunch of students all over the place, there’s a broken computer on one side and a half-built robot and some weird art installation. It’s incredibly inspiring. And those two guys were really really wowed by it too.

Andrew: So you’re hanging out with MC Hammer, Ron Conway, one of the, maybe the most famous angel investors ever, right?

Dennis Crowley: Yeah probably. Yeah.

Andrew: Incredible. You must be…actually how do you feel about that? Do you get excited all the time? Do you feel like, “I’m in some dream of mine from years ago?”

Dennis: I think we’re really psyched to be working on something that people are really passionate about. The lesson learned from a lot of the Dodgeball stuff was that it’s very fun building things that your friends like to use. You go out on a Thursday or Friday for drinks with people and they tell you everything that’s great about what you’re doing and everything that sucks about what you’re doing.

Then you spend the weekend fixing it all. Next week it’s like what do you think? Is it better or worse? We had that with Dodgeball and we lost it at some point. It’s tough it’s been two years without having a project to tinker with. Now we have that back with Foursquare.

We’ve got a lot more users that are a lot more passionate. The phones are much smarter. We have all these ideas for things we want to do and it’s really nice to be able to do them again. I think we’re really going to be blowing people’s minds with the new stuff that we’re rolling out.

Andrew: I want to get to that. I want to blow people’s minds a little bit with whatever you’re willing to tell me but I want to go back and play psychologist for just one question here and ask you…

Dennis: Yeah go for it.

Andrew: Go ahead. Oh sorry I thought I lost you. What’s the motivation here? Is it money? Is it to leave a legacy? Is it that you’re just such a tinkerer that you can’t stop? Is it that you have this vision for what mobile could be and you can’t stop until you get to that? What is it?

Dennis: We’ve been building this stuff in New York for a while. It’s 2009 I figure I’ve been doing this eight or nine years. You see when you build little things it brings people together. Our group of friends used to be five people sitting around a bar on a Friday night.

A lot of people use Dodgeball and other social media tools so it’s now 100 people that are all loose friends with one another and it’s a huge supportive network. Overtime you just see how this stuff changes your relationships with people and your relationships with the city.

That’s a powerful thing if you build something you and your friends use every single day. You have the ability to change their experiences you’re introducing them to…

Andrew: Why is that something that you want?

Dennis: It just makes everything more interesting. You’re building software that changes the way people experience their Friday nights. That’s a fun space to be building stuff in.

Andrew: I’m going to continue then with the story and then we’re going to come back to blowing people’s minds. We’re going to leave that out as a hook. I want to continue with the story to get the biography of Dodgeball. You build this within ITP. You now graduate. What happens to Dodgeball after graduation?

Dennis: Alex and I were going to get other jobs. I was going to go back and work at MTB and he was going to go back and work at RGA. RGA is a design shop in the city and you know MTB. The day we graduated there was a story in The New York Times about Dodgeball and it was gaining momentum.

We had this moment like, “If we play our cards right we can probably turn this into our jobs and this will be what we end up doing. ” We gave ourselves six months. This is borrowing money from my parents to help pay rent and a little bit of freelance work on the side. Alex was doing the same.

We went out and pitched a whole bunch of different investors. We’d had a really hard time raising money. Venture capital firms wanted to write $5 million checks, and we were looking for $100,000. We didn’t really know anyone. We were just two kids coming out of graduate school. It was very difficult to get connected with Angels in New York. This is back in 2004.

Andrew: We lost the connection…

Dennis: This was back in 2004. It was hard to get Angels. It was a different climate. I was giving talks at academic conferences and O’ Reilly Conferences. We were like “Hey. We’re working on this thing called Dodgeball we think it’s really important.”

We caught the eye of the Google guys. While we were looking for money they were like “We don’t really invest in companies but we’ll just acquire you guys and you can come work for us and continue to build the things that you want to build.” That was a fantastic deal for us and we get to do what we want to do. We get a job out of it and we get a little bit of a payday too.

Andrew: Why didn’t you go for the $5 million investment if that’s what was available, if that’s what VCs were looking to make?

Dennis: They weren’t going to give it to us. They wanted to write checks for that much. But, like, we were rolling in in T-shirts and jeans. Like, they’re not going to . . .

Andrew: I’ve seen people who are rolling in, in T-shirts and jeans too. Is it that you just didn’t have the connections? That you weren’t plugged into the community of angels and advisors and investors?

Dennis: We weren’t plugged in as much. We didn’t have any reputation for doing anything. We’d never run companies. We had both been laid off from other companies. We came from this really weird program at NYU that no one knew about. Who’s going to trust us with that check? I don’t blame them. It wasn’t like they were handing it to us and we’re like, ‘No, no, no’. We would go in there and they’re, like, ‘We write big checks and you guys aren’t ready for big checks.’ The Google thing was a good opportunity to continue to work on Dodgeball. But kind of do it on someone else’s dime.

Andrew: You know Ron Conway now.

Dennis: Mm-hmm.

Andrew: Had you known him back then, do you believe that he would’ve invested?

Dennis: I don’t know. I think there’s a lot to say for being a different, it was a completely different environment. This is before Delicious was sold and before Flickr was sold. Everyone, I think, was still feeling a little burnt from what happened in 2000 and 2001. Tech was not the place to be, squirreling away your money at the time. I think we were still telling a good story. But there was nothing that was successful in mobile. There was really nothing that was successful with social. We were all just getting started. Everything is so much different now.

Andrew: Yeah, it is. We’re all walking around with smartphones, and they’re just getting smarter and smarter. It’s not just tech space [??].

Dennis: People see the value of the service now. There are millions of people whose lives are better or more interesting because of things like Twitter. There’s an ecosystem for all of these apps. Facebook’s doing amazing things. Twitter’s doing amazing things. There’s a big opportunity for other amazing things to exist in that space. I hope we get to be one of those things.

Andrew: The rumor was that the company sold for about $40 million. Is that true?

Dennis: No, it’s not true. It’s not even [??].

Andrew: What did you guys sell for?

Dennis: The number is not disclosed. That’s an incredibly high estimate. It was not close to that.

Andrew: That’s what I figured based on this story and what I’ve been hearing. Can you give us a sense of what it was sold for? Did they get it for a steal, for a few hundred thousand? What did they get it for?

Dennis: We don’t disclose the numbers. It’s just part of the arrangement that we have with those guys. But it was enough that we didn’t have to work for a couple of years. We got to continue working on the stuff that we were passionate about.

Andrew: Just enough to not work for a couple of years, not forever.

Dennis: Yeah. We’re not rolling around in yachts and helicopters.

Andrew: OK. Before we get into what happened afterwards, can you give me a sense of the evolution of the product? What did it become just before the sale? What did it look like?

Dennis: Dodgeball? What did it look like?

Andrew: Yes, Dodgeball, just before the sale.

Dennis: Technically, it was just some crappy PHP code. But I think what we liked about it was that we understood the space really well. We were really excited about social media. We had done a bunch of experiments with people in New York. We knew what we were doing. All we needed was more resources to make things happen. Our hope was that we would go and get a couple of engineers. Maybe they would promote us a little bit. We’d have a couple hundred thousand people using it. You could really see some interesting things happening.

Andrew: People would check in, right? To let Dodgeball know where they were.

Dennis: Yeah, yeah, yeah.

Andrew: They would check in by texting into you guys, right?

Dennis: Yep.

Andrew: And you had a clever solution for not having to pay AT&T and Verizon for those text messages. Can you tell people what that was?

Dennis: Yeah. It wasn’t even clever. It was just out of necessity we found this thing where you could basically send an e-mail to someone’s phone number and it would arrive on the phone and look like a text message. You could do the same thing on the way up. Instead of typing a number, you can type an e-mail address in your text message field and it would come to us. It didn’t work on all phones. It never worked for 85% [??] users. But it was enough to get the point across. That, hey, we’re doing this thing where if you tell us where you are, we’ll do interesting things for you. We’ll you about things going on nearby, [??] to people. We tried to push that text messaging interface as aggressively as we could to do these interesting things.

Andrew: Were you identifying peoples’ locations based on cell towers?

Dennis: You couldn’t do any of that stuff back then.

Andrew: It was just based on self reported information.

Dennis: Yeah. You would say, ‘Hi. I’m at Ace Bar.’ And we would go into the database and be like, “Okay do we have an Ace Bar? Yes an Ace Bar is this lat long,” and if you spelled it wrong we didn’t know who you were and if you made up a place we didn’t know who you were. It was really primitive but it worked. It worked surprisingly well for how simple it was.

Andrew: Okay and so the company that loves innovation, developers, and that’s going to invent the future buys you guys out and says, “We have the money and resources to help you guys see this through.” What did you imagine the product would look like with their help?

Dennis: We wanted to get it on more phones. I didn’t have a smartphone at the time but we knew that there were phones coming out with GPS built in. Some of the BlackBerrys were starting to be location aware. We just wanted to build more advanced versions of some of the stuff we were thinking about.

We worked with a variety of teams there. We consulted with their mobile team. We worked with the Orchid guys for a little bit. It was difficult to get certain things done.

Andrew: How do you mean? I’ve heard you say this before and I’m trying to imagine what it must be like. You’re in an office. You’ve got computers…

Dennis: We were in the New York office. They were based out of San Francisco and we were just two kids from NYU. I think it was weird that some of the infrastructure that we needed to get up and running was someone watching over us, making sure we have some engineers, and we were talking to the right people.

Some of that stuff existed. Maybe we should have moved out to San Francisco for a year but we didn’t do that. I think it was a perfect storm of things that just went wrong with the deal. We had a hard time getting integrated with other things

Andrew: Why did you and Dennis not go to San Francisco?

Dennis: Why did Alex and I not go to San Francisco?

Andrew: Right. Sorry.

Dennis: I’d been living up here for years. My family is on the East Coast. Alex was engaged at the time. My kid’s family is out here too. His wife’s family is out here too. We were born and raised on the East Coast. No one was that excited to move out to the West Coast.

Andrew: Then at some point you decided to quit but you didn’t do it quietly. I saw that Flicker photo where you didn’t give them the finger at Google but you gave them the thumbs down in a picture.

Dennis: It was a thumbs down yeah.

Andrew: Right. That’s a pretty gutsy move. Aren’t you worried about your future? Aren’t you worried about them buying your next company or about any of that?

Dennis: No we were just frustrated at the time. There were a lot of things we wanted to do and we just weren’t able to get them done.

Andrew: Like what? Would you requisition something and they would ignore you? Were you asking for some kind of support and they said, “No?” Did they take their time even responding? Was it like getting an app approved at Apple?

Dennis: No it’s kind of easy to get lost in a big company. I used to work at MTB and it was the same type of thing. I could have really good ideas and sometimes they wouldn’t make it to the places that they need to. I think we ran into the same type of stuff.

It’s a big company growing and we’re two guys that are pretty excited about things and we don’t have the proper channels to make the noise that we wanted to make.

Andrew: Okay so you left the company. The company pretty much abandoned your project.

Dennis: They launched Google Latitude. They launched another product. They didn’t want two competing products which I can agree with.

Andrew: What was the product?

Dennis: There’s another one called Google Latitude that’s out now. I could see them not wanting to have two mobile services it’s confusing. Dodgeball got turned off I think in February of this year. We heard about it in January. That’s when me and my co-founder Naveen started getting serious about if they were going to turn it off we should build something to replace it.

Andrew: I see. Why did you get together with Naveen instead of with Alex?

Dennis: Oh Alex took a gig at a company called Schematic. He’s a superstar there. He’s heading up a User Experience Team. He’s really enjoying it. I went to another startup called Area Code that some of my friends were running and I was there working in a building sharing office space with a couple other companies.

One of those companies was a company called Socialite that Naveen was working for. Naveen and I were both passionate about building things that make cities easier to use. I like the Friend Finder stuff and he really likes the City Guide stuff. We were tinkering back-and-forth.

Dennis: It just kind of happened we started working on projects together. We had this little prototype for Foursquare stuff and in January we decided we should build this stuff for real. We should try to make a product out of it.

Andrew: Okay that was January of 2009, not too long ago.

Dennis: Of 2009 yeah.

Andrew: You guys built the first version yourselves?

Dennis: Yeah we built it. It was the two of us for the first five months or so. He was working on the iPhone side and I was working on the backend side and the website side and just hustling to get it done.

Andrew: All right before I start asking you questions about that let me just thank a few people who are watching us live including Heaton Shaw. Do you know Heaton Shaw by the way?

Dennis: Wait who?

Andrew: Heaton Shaw?

Dennis: I don’t know but if I do, hi.

Andrew: We’ve got to introduce you if you don’t. Heaton let me know if you don’t. I want to thank Heaton Shaw for telling people to watch us. Gabe Redino, URLgirl, Jennifer 23, Heaton Shaw one more time, BookBlade thank you, Alexander King, thank you all for telling your friends to come watch us.

Andrew: This is the first time I’m doing an interview from Buenos Aires and I can use all the support I can get from you guys. You guys decide you’re going to start this company January 2009 I see you online and I’ve got a sense of you here from this interview as a visionary.

Andrew: You have a big idea of what mobile can be about. What location- based businesses can be but you’re starting a business with no outside funding with just you and a partner. How do you reduce this big vision and what do you reduce it to? How do you find that core?

Dennis: I think it cut out a little but I think I know what you’re asking. It was kind of easy because we wanted to first and foremost reproduce the functionality of Dodgeball. The thought was if you turned Dodgeball off in New York and San Francisco and a couple of the other cities we were really popular in there’d be a good number of users that were inconvenienced by it.

We still all were using it in New York to coordinate. You don’t make plans everyone just checks in. We’d been doing it for years and if it goes away it’s like, “Shit now what do we do?” It’s like that one day that you go out and you forget your cell phone and you’re like, “How am I supposed to make plans now?”

That’s how it would have been if Dodgeball just went away. We just wanted to re-launch a Check-In Functionality on an iPhone. We started doing things a little bit smarter. We knew I was going to take a while to get people migrated over so we started building in some Game Mechanics that would make it fun if you didn’t have a lot of friends.

It turned out the Game Mechanics were really sticking and people really enjoyed trying to get points and matches. So we started refining some of that and giving some more thought to, “How can we make this a fun one- player experience?” As we started doing that stuff we were realizing, “Oh, the data we’re collecting about where people have been is really interesting in terms of being able to make recommendations.”

Andrew: The Game Mechanics you said you refined what did they look like at first? The Game Mechanics for anyone who hasn’t tried it are winning badges based on how often you go to a location, what you do on the service. You get to be mayor if you’ve been at a location the most number of times. What did it look like at first?

Dennis: They don’t look too different than what they do now. They really need to be redesigned a little bit. It was basically you get a couple points for checking in. If we were able to detect patterns in your social behavior we would give you badges. We were experimenting with what some of the badges would look like if you get them for going to restaurants or bars.

We eventually started building them so you’d get them for staying up late, going to karaoke places, or eating out of food shops, going to really nice restaurants. You can identify patterns in people’s behaviors and reward them for it but I think there’s a lot more that we can do with that.

Right now we’re rewriting a lot of our infrastructure and redesigning a lot of the product on the technical side

Andrew: What kind of things are you going to be changing?

Dennis: In terms of the Game Mechanics?

Andrew: Mm-hmm.

Dennis: We have a problem with cheaters in a sense. It’s not a lot of users but it’s enough users that it can be a little bit of a nuisance. It’s people that check-in at restaurants and coffee shops while they’re watching TV on their couch.

They’ll do it to steal [?] or try to earn a badge. Why would you cheat? It’s a social game. We can do some things to correct that. That’s one of the things we’re working on. Once we do that we’ll even the points out a little bit. I don’t like the leader board but admittedly I don’t pay as close attention to it today as I used to. I think as a designer and developer of the system we should make it so we’re following those points very closely. That I care about the number of points my friends have. We made the points go toward something so I think there’s a good opportunity to do a lot of that stuff.

Andrew: What do you mean? The more points you get the more free lunches you might get somewhere or the more what?

Dennis: They could translate into something like frequent flyer miles or Coke Reward Points. We talked to some people about maybe their points getting donated to charities. Who knows? They can be used for a lot of different things.

The idea that you’re earning some kind of currency for doing things in the real world is a really powerful idea. I think there will be a lot of people experimenting with that. Yeah we’re pretty psyched to be at the front of it.

Andrew: Another thing you said earlier is that you wanted to create a good “one-player experience” you called it. That’s one of the problems I’ve got with competing products. I’ll log in. I won’t have anyone on there who I know. I won’t care about the program then and I’ll just dump it. Is that what’s separating you guys from the others?

Dennis: I think so. We knew that’s what was broken with Dodgeball. If you don’t have 50 friends on Dodgeball it’s boring. What we tried to do is say, “Okay let’s build something that works if you have 50 friends or if you have zero friends.”

You still want people to check in and have fun using the product and generally I think the stuff we’re building is more fun than the stuff other people are building.

Andrew: So far everything we’ve said about this seems to be an instant hit. Have you had any flops? I know it’s been a short amount of time that you’ve been running this company but have you had any flops with Foursquare?

Dennis: Initially when we launched it by South by Southwest we had a huge number of users sign up and then it just tanked. The usage fell off and no one was really that interested. The product was lousy. We didn’t have a [?] version. It kept crashing. Eventually we thought it was just over with.

We started fixing it, adding some of these mechanics, integrating it to Twitter, revising the badges, slowly chipping away at things that were broken and the users started coming back.

Andrew: Integrating with Twitter helped?

Dennis: Yep.

Andrew: Changing the design of the badges you mean?

Dennis: No. Making it easier to get, cleaning up some bugs. It was pretty sloppy when we launched this thing in March. We should never have launched it but we needed to and we wanted to do something cool for South by Southwest.

When we went down there we were kind of 50/50. People are either going to really like this or they’re going to laugh it and be like, “This is a stupid idea. Go get a real job.” We went down like I don’t know if it’s going to happen and it turned out it was a big hit. Let’s continue working on it. Let’s see what we can make of it.

Andrew: It does seem like it was a big hit. I didn’t play it at South by Southwest. Oh no, that’s where I first installed it actually. I take it back. A buddy of mine had it on. He said “Install it.” I said “All right.” There weren’t that many apps that were location based. I had to try it.

Dennis: We’ll have to figure out some way to one up ourselves this year at South by Southwest.

Andrew: South by Southwest seems to have been, at least in the blogs that I read to do research for this conversation, the defining moment where Twitter separated. It seems like going into South by Southwest there might have been competition at least in the blogs.

Andrew: They were saying, “Will Dodgeball beat Twitter?” and “Will Twitter stand out?” It turns out obviously that’s where Twitter really made it’s name. Is that why you feel that South by Southwest is so important now for Foursquare?

Dennis: South by Southwest is where all the tech influencers come to hang out and be social for four days. It’s less about us having to have this winning app. It goes back to the question you asked me earlier. You build things that you think your friends are going to enjoy.

We thought we could build something that would make South by Southwest easier because we know where people are. It would make it more fun because you’re collecting these badges. You’re trying to win the badges, that’s fun. We’re looking forward to it this year because there are a lot of people who really enjoyed Foursquare.

It was pretty broken last year and this year it works pretty well. By March it will work a lot better. I’m really looking forward to it. Okay here’s this thing we really wanted to build. Here’s our second chance at it. Let’s really make something awesome.

Andrew: What about revenue? I remember the first time that I saw a coupon come up on my Foursquare screen. I was walking down Third Street Promenade checking into a place that I’d just walked out of and then an ad popped up for Fat Burger. It was awesome. It said, “Go to Fat Burger and you’ll get some kind of special promotion.”

Dennis: I wish it was our idea. There was this coffee shop in San Francisco called the Marsh Cafe. Right around the time that we were getting really excited about users bragging that they would be the mayor of whatever place, what not, entering points and badges. These venues went out, and they were making flyers, and hanging these flyers out. It’s, like, show us who the mayor is, and you’ll get a free comp or a free ticket. The Marsh Cafe was the first one to do it. Then we had a bar in New York and then another bar in New York called Destination Pickup on it.

Before we knew it, we had 20 places that were offering these specials. It’s, like, let’s build within the app. Let’s make it so you see these things when you go out. Maybe it will be a reason to build coffee shop A, instead of coffee shop B. That’s kind of what it’s turning into. We’ve got this whole plan. We’re working with this guy, Justin Walker. He’s a friend of ours out in San Francisco, and he’s our San Francisco office, our business development guy. He’s cutting deals left and right. He’s cutting them at bowling alleys and hotels, and Fat Burger and big, big chains. It’s exciting.

Andrew: How are you charging them? Are you charging them on a per customer basis?

Dennis: No, dude, we’re not charging them. It’s almost like brands are using Twitter. They just do it free. We’re doing the same thing. It adds value to the users. The users want to use Foursquare more because, like, hey, I got this special promo at Fat Burgers in there. And it’s, like, hey, people are coming and checking in and stuff. I”m sure we’ll figure out a way to do it eventually. We haven’t done it yet.

Andrew: It’s not ready yet in the immediate future. It’s not about revenue yet. How do you turn it into revenue in the future? What do you see?

Dennis: You might be able to charge those places a couple of bucks here and there for showing those coupons. Maybe the more targeted you want to get, the more you’re into paying, or maybe the more people that redeem it, the more you’re into paying. It could be something that’s similar to CPM, like for check-in, or cost per visit, or cost per purchase or something like that.

I think you’ll see, as we start getting ready with point of sale terminals, like if you go and you buy a Big Mac or something, that you scan the coupon off the phone. Who knows. All the stuff is doable and it gets a lot more trackable. There’s a lot of people who have tried the traditional couponing space. But they’re usually, like, you have an app that gives coupons. It’s not the way that people use that stuff. Instead, we have an app that helps you navigate cities and then occasionally a coupon pops up. If [?] a coupon, it’s just, like, hey, you’re a good user. Here’s something for free, or, hey, you’re here with five friends, you get something interesting.

I think everyone’s been in a bar where the bartender gives you a buyback, because you’ve been there for two hours. Or maybe you’re out at a restaurant and you’ve ordered two nice bottles of wine, and the owner comes over and shakes your hand. You know that makes you feel good. I think we’re making more of those things happen, but we’re just doing it with software.

Andrew: That, by the way, has been the dream of any mobile company since the beginning of mobile, that you could walk . . .

Dennis: Yeah.

Andrew: . . . down the street, and suddenly the right coupon will pop up that will draw . . .

Dennis: Yeah.

Andrew: . . . you into a store.

Dennis: Yeah.

Andrew: Do you envision syndicating these ads out the way that adsense works? Do you imagine that other people might be able to have them as part of their apps?

Dennis: Yeah, I think so. We’ve got an API that people are starting to use right now. It’s not public, but there’s bunch of people using the private [?]. We’re using it to build apps that are like Foursquare. When you check in somewhere, something happens. Every time someone uses the Foursquare [?] to check in, we send down some coupon data. You can display it if you want to. You don’t have to display it.

The way we think about it is the promos that we do within the app should be so great that, if you don’t get them, you’re disappointed. You’re like, well, I want to get the offer for the free chicken sandwich, because I’ve been here ten times. You feel kind of naked without it. We’re hustling to make sure we get the right types of venues, the right types of offers, and then we’re letting other people play with some of those data, some of the APIs, so that they can make the [?].

Andrew: By the way, if anyone is watching us live, and you’ve got any questions, ask them now. We’re coming close to the end of the interview. While you guys are typing in your questions, I’m going to ask the question that I wrote down here earlier. How do we blow people’s minds? What’s coming up?

Dennis: Well, I think there’s a good opportunity. I think City Guy stuff has just been broken for a while. If you look at the way that Netflix recommends movies, and Amazon recommends books, we can do the same type of things, but for places, and experiences and people. We saw this when we had some mild success with Dodge Ball, where if you nudge someone just enough. It’s like, hey, you’re at the same place as this person that your brother went to college with. Why don’t you go meet them? Go introduce yourself. People will do it, and good things come out of that. A big part of what we’re doing is discovery. How do you help people find new things and have new experiences. People feel excited when they do those things. You have an amazing night that was very serendipitous.

I think, for a lot of the DodgeBall kids, all our friends in New York, we’ve been living in this bubble, which has been amazing, for three or four years. Technology just works and it brings people together. Now, we’re finally getting people in all these different parts of the world experiencing that for the first time.

The stuff that we’ve been experiencing for years, people are experiencing that for the first time. Your read about it all the time in people’s tweets and then their blog posts, and it’s like, s***, this is what we’ve been waiting for. It’s what we’ve been trying to push on people for a while, and it’s finally taking off and it’s finally sticking.

Andrew: Yeah. The future is here. You imagine, though, and what’s coming up is even more mind blowing. You imagine that I’m going to use my mobile phone through you to discover new locations based on the ones that I’ve liked in the past, and new people based on my current connections. That’s what you want to do with Foursquare.

Dennis: Sure. Yeah. Yeah. I want Foursquare to buzz in your pocket when something cool is happening nearby. It’s, hey, you, look up and look across the bar because that’s a person you need to meet. Or grab this person, and you guys need to go across the street, and have this thing that a friend of yours recommended. Go try the tacos two doors down.

When software does a good job at it, there’s nothing more awesome that that. We saw this in the early days of South by Southwest, even when we and [the B] were unsure whether this would work. You’d be at these places in Austin, and we would check in, and a tip would pop up before you ordered your food. It would be, oh, Justine says order the ribs, get this beer, this is the side. Then the person says, what do you want? And you say, I’m going to take the ribs, this side and this beer. I did that because my friend recommended it, and that was the best thing that could happen. There’s something awesome about that experience. That was the first day that we launched the app.

The stuff that we’re doing now is so much more sophisticated. When it works, it works really well. It’s working really well in New York right now. Our goal is to make it work just as well in all these other pockets.

Andrew: Let me hear the visionary. Beyond Foursquare, what do you think is going to happen with mobile devices in the future?

Dennis: The iPhone’s got all these sensors in it that we never had before. We’ve got GPS and altitude and we’ve got a compass, and we’ve got [Excel ROM]. You can do anything you want with it. The only that’s missing is proximity detection. I walk into my office, and there’s 50 people here, and my phone does not know who those 50 people are. That would be a nice thing to have.

I think we’re a little bit away from that. There’s some privacy restrictions with it. We can do stuff like Blue Tooth. Nobody uses Blue Tooth. I, think that’s a big piece that’s missing, and once that changes, a lot of interesting things can happen.

Andrew: I remember when the compass first came out for the iPhone, most people didn’t understand, including me, we didn’t understand exactly what we were going to do with a compass.

Dennis: Yeah.

Andrew: It said, all right, it’s great, I can find true north, but we didn’t realize that you could get augmented reality, and all the other things that came on top of it.

Dennis: Yeah.

Andrew: Once we have proximity detection, what do you think we can do beyond meeting people who we already know and maybe a couple of new friends?

Dennis: I’ve always wanted to build the app where you can stand outside a bar, and you phone will tell you, is there anyone in here that I want to meet? Are there people that work in companies I want to meet? Or is there someone I should meet because it’s my brother’s old roommate, or is there someone I want to avoid, like an ex-girlfriend or some guy that want to punch me in the face?

It’s like the ability to see through walls, or see around corners. You can kind of do that with data a little bit. There’s things that we’ve been thinking about for a while now, like we’re just about to be able to build. Like no one’s been able to build yet. It just requires one more release of the iPhone [??] a little bit of hardware in there that you can open up and make things happen.

Andrew: All right. Well, I see we’re coming up at the top of the hour here. I promised that we’d go 45 minutes to an hour, and I think we’ve gone beyond that, including the set-up.

Dennis: Okay.

Andrew: Let me ask you this, if you weren’t doing this, what would you do? What other opportunities do you see out there?

Dennis: I don’t know. It’s an interesting question. [??] I think the reason we’re doing this is that there wasn’t another product that we wanted to use. There wasn’t a company that we wanted to work for. Let’s make the stuff that we want to do.

One of the other spaces I’m really passionate about is taking a lot of the social media stuff and making it happen on TV. While you’re watching baseball games and football games, you get to participate with the conversations that your friends are having about the same game and the same show. I really like that stuff.

We did some experiments trying to make it happen. All right. I really like this space, but then, once Google turned Dodge Ball off, it was our duty to rebuild this thing. Because there’s nothing else that’s going to take its place. We just need to do that, if only for our hundred friends in New York. Not knowing it was going to take on a life of its own. It’s kind of like a best case scenario.

Andrew: All right. Well, thanks for doing this interview. Hang on while I say goodbye to everyone. Everyone who’s been watching us, thank you guys for watching. Give me any feedback that you can about this interview. I’m still getting setup here in Buenos Aires with my new system. I’m still learning a lot as an interviewer, so if you’ve got any feedback on the way I’ve been interviewing, let me know that. I always suggest that you connect with the people who I interview. Dennis, how can people connect with you? Can they add you on Foursquare?

Dennis: Yeah, [inaudible].

Andrew: I’m sorry. Can you say that again? We just lost you again.

Dennis: Yeah. [??] search box. I’ll pop up. Also, you can find me on Twitter. It’s just @Dens.

Andrew: All right. Thank you. I’ll look for everyone’s comments. Thanks for watching or listening. Bye.

Dennis: Cool. Thanks, man. I appreciate it. It was a lot of fun.

Full program includes

– As you listen to this interview you’ll pick up on Dennis’s motivation as an entrepreneur. I think you’ll relate to his desire to show that his idea will work.

– Dennis talks about why his sale to Google didn’t work out as he planned and the one thing that might have helped.

– You’ll see how an innovative idea develops into a business. We spent a lot of time on that.

Notable points from this program

– The original idea for Dodgeball, foursquare’s predecessor, was to create a smarter city guide similar to Yelp.

– Dennis says going to NYU’s ITP program helped sharpen his startup’s ideas. Here’s an excerpt:

[Dodgeball] was very difficult to explain to people. It was mobile, it was social, I mean you needed a friend’s list, which no one was doing at the time. So it didn’t really gain any traction. It didn’t pick up traction until around 2003 / 2004 when I was at ITP, this grad program at NYU, with my buddy Alex. We were able to re-invent some of the Dodgeball stuff in the context of “Hey it’s like Friendster but for cell phones.” And once we started doing that, people got it and we were able to reach a wider audience.

– Dennis and his friends bought the domain name, but he got to keep it because he paid the hosting fees.

[] was it was a domain name that me and some buddies from college bought back in 1998 and we used to use it just as our personal blog like to post stories of ourselves. And then I started working on this city guide stuff and I just let those guys know well I was going to use the name for this other product and we will all get our own other domain names by then.

– At first, their idea was socially awkward, so they tested it.

That’s what a lot of our work at NYU was about, seeing if we convinced a 1000 people to tell us where they are on Friday night, does that make Friday more interesting? Or does that make it more awkward? Or like how does that whole thing work out? And that was a lot of what Alex and I were trying to do with our thesis there.

– They felt they had to sell their company to Google because they weren’t connected enough to raise money to keep it going.

I think it’s like, we weren’t plugged in as much.  We didn’t have any reputation for doing anything.  We had never run companies.  We had both been laid off from other companies. We came from this really weird program at NYU that no one knew about.  Who’s going to trust us with that check?  I mean, I don’t blame them.  It’s wasn’t like they were handing it to us and we’re like, no no no no no.  We would go in there and be like, yeah, we like big checks, and you guys aren’t ready for big checks.  So, Google thing was a good opportunity to continue to work on Dodgeball, but kind of do it on someone else’s dime.

– He co-founded foursquare because Google shut down Dodgeball.

It was two of us [Dennis and foursquare co-founder Naveen] for I do not know if it’s like five months or so.  So, you know, he was working on front end side and I was on working on the back-end side and the website site.

– Since social networks tend to suck until users have a lot of friends, Dennis and Naveen added game elements to make foursquare fun for single users too.

We knew it was going to take a while to get people migrated over.  So we started building some game mechanics that will make it fun if you don’t have lot of friends and it turned out that the game mechanics were really sticking and people really enjoying it.  You know, trying to get points and trying to get badges.  So we started refining some of that and giving some more thought to how we can make this kind of fun one player experience

– One of the issues foursquare is tackling now is cheaters. People are so eager to earn badges that they’re using the app to check in to more places than they actually visit.

– foursquare could end up building a powerful local ad network that will let you see a coupon for a local business as you walk past it.

We’ve got an API that people are starting to use right now.  It’s not public but it’s a bunch of people using the private beta.  [Other companies are] using it to build apps that are like foursquare; that when you check in somewhere something happens.  And every time someone uses the Foursquare API to check in we send down some coupon data.  You can display it if you want to.  You don’t have to display it.

The way we think about it is like the promos that we do within the app should be so great that if you don’t get them you’re disappointed.  You’re like, “But I want to get the offer for the free chicken sandwich because I’ve been here ten times.”  And you feel kind of naked without it.  So yeah, we’re hustling to make sure we get the right types of venues, the right types of offers.

Who should we feature on Mixergy? Let us know who you think would make a great interviewee.