Last November we announced that we’d be discontinuing the Flowtown social discovery service. This was our main feature and the reason people used Flowtown.
A lot of questions arose that day and we tried to answer them as best we could. However due to contractual obligations and the sensitivity of the situation we couldn’t disclose 100%.
I’d like to go back now and tell the full story.
Life Was Good And Growing
We launched Flowtown V2 (“social discovery”) in November 2009. By January 2010 we were ramen profitable and in February we raised a $750k seed round from a tremendous group of angel investors.
By October 2010 we had signed-up over 26,000 businesses, closed 13 big integration deals and had been growing revenue 30% month-over-month for almost 12 months straight.
Then things got turbulent.
Getting Shutdown
The main reason we turned off the social discovery service is because we were shutdown.
In late October 2010 the Wall Street Journal published an article slamming Facebook for leaking user data. But Facebook wasn’t leaking user data. Certain application developers on the Facebook platform were selling this kind of data to third-party brokers who would turn around and sell it to other data providers and advertising networks.
This article and the publicity that followed caused Facebook and other big social networks to take a strong stance against companies indexing and selling user data. Here’s one particular blog post from Facebook.
The thing is we didn’t start Flowtown to sell data. We started Flowtown to make social simple, to show businesses how you can really get and keep customers through social media.
So we decided that it’d be best to start working on new products that pursue our mission, instead of staying to fight a losing battle.
Doing What’s Right
Once we made the decision to shutdown the service, we decided it was extremely important to treat all of our customers how we’d want to be treated.
We emailed and called all of our customers and gave them a 2 month notice that the social discovery service would shut down on January 1, 2011 and offered alternative solutions. Additionally we told them we’d continue to support all Flowtown email functionality for the foreseeable future.
We called all of our integration and API partners and broke the news. We thanked them, big time, for being partners, for investing in the relationships.
Back To The Drawing Board
On an early Monday morning in November, we brought the team into the conference room and told them “everything we’ve done for for the past 12 months stops today; here’s what we’re thinking for the future…”
I thought we would lose people. Everyone stayed.
We went to the white board, drafted several product ideas and started working on them that day.
We wound up building 3 products. It was after we saw which ones were getting initial traction and holding our attention that we started to focus on a prototype code named Ambassador.
Gift Marketing
Fast forward to today and we’re starting to invite people to the new version of Flowtown.
I’d like to reiterate that the new Flowtown has nothing to do with our old product – turning email addresses into social networking information.
The new Flowtown, or just Flowtown, makes it really easy for businesses to give gifts to fans and followers and customers. We’ve coined this Gift Marketing also known as Social Sampling.
If you’re a social marketer or community manager interested in building brand loyalty and attracting new customers, you do not want to miss this. So if you haven’t already, be sure to signup for an invitation to Flowtown here: http://www.flowtown.com
Finally I’d like to end with a BIG THANK YOU to our awesome community, supporters and customers who’ve been so good to us through these challenging times. If it wasn’t for you, none of this would be worth doing.
Ethan Bloch
CEO and Co-Founder
ethan(at)flowtown.com
(Photo credit: flickr/G Crouch)
