Michael Chasen speaks a mile a minute, and maybe there’s a reason why. He’s a serial entrepreneur who has discovered his next calling – providing location-based connections for young, mobile users. It’s a well-worn story at this point, but Chasen may just be the one to make money in this space.
If Chasen’s name sounds familiar, it’s likely because of Blackboard, an education software company that he cofounded with his college roommate in 1997. Blackboard went public in 2004 before it was acquired in 2011 by Providence Equity Partners for $1.64 billion.
Needless to say, Chasen never has to work again. But while visiting colleges during his Blackboard days, he realized his latest idea – connecting people who are in close proximity to each other through their phones – might be an even bigger opportunity than Blackboard. As a result, he quickly put together a 20-person company and, in June, closed on $12.5 million from NEA, Grotech Ventures, and a long line of celebrity entrepreneur-investors, including Steve Case, Ted Leonsis, and Dave Morin. He could have raised more. (“We actually had over $20 million in interest for the $12 million round,” Chasen tells me at at a San Francisco coffee shop. “We had investors we said no to, and we had to scale people back.”)
Investors were presumably taken with Chasen’s track record. But Chasen also argues that his company, SocialRadar, which is based in Washington, D.C., is a billion-dollar idea. Its objective: to cross-reference the location beacons in our pockets – our smartphones – with the now two billion social profiles online, to create real-time information about the people around us, whether they’re 300 feet or 50 miles away.
“With SocialRadar,” says Chasen, “you can walk into a room, and we’ll tell you there are 10 people here who you know: five coworkers, three people you went to college with, and two people who live on your street. Beyond that, we’ll tell you that your one college friend recently got his MBA and another was recently married.” Adds Chasen, “Right now, people might think, Why do I need to know who’s around? But it’s about having that information at your fingertips. You might not act on it, but maybe you will. It all depends on the context.”
SocialRadar is still in beta, with plans to launch by year end. (Chasen says the team is still working on all kinds of features, including around privacy, so that if you want to see who is around you but don’t want to be seen, you can list yourself as “anonymous” or use the app completely invisibly.)
Once it scales, SocialRadar intends to make money through directed commerce, by presenting location-aware offers and the like. But Chasen says the focus is very much on growing the business first — something he thinks he can do quickly by leveraging location information from Facebook, Instagram, Twitter, LinkedIn, and Google to show users who’s around, regardless of whether those acquaintances already have the SocialRadar app.
The strategy isn’t without huge risks. The location-based landscape is filled with the bones of entrepreneurs who’ve tried to make money off seemingly useful services and failed. More, some of these services might object to SocialRadar monitoring their users’ data. If Facebook, in particular – the veritable 900-pound gorilla in this space – decides that it doesn’t want to play nice, SocialRadar could find itself in a very tight position.
Then again, Chasen has proven that he can make money in a tough space. The number of investors who’ve made money in education is minuscule, and yet he succeeded twice, first in taking the company public, then in selling it to a major private equity firm. Chasen also seems realistic, the product of his many years as an entrepreneur, no doubt. As he puts it: “Just like mapping software has fundamentally influenced the way that people use technology and get around, this technology has the same potential. Five to 10 years from now, everyone will have this technology and use it on a daily basis — whether or not it’s SocialRadar.”
Sign up for our morning missive, StrictlyVC, featuring all the venture-related news you need to start you day.
