For some startups, there is life after the deadpool. Take Wallop, a social-network-turned-social-app company that dove under in September, only to now arise again as Coveroo. Wallop still had some money from the $13 million it raised in 2005 and 2006, but its business wasn’t working. It’s original idea was to sell virtual “self expression” items through its own social network. It ended up creating animated greeting card and party invite apps for Facebook. Rest in peace.

CEO Karl Jacob isn’t giving up, though. He is just moving in a different direction, away from virtual goods and towards customizing real consumer devices. Using mostly its stock, Wallop acquired Etchstar, a custom engraver that specializes in laptops, iPods, and cell phones. And now it is relaunching as Coveroo, which is making it even easier to personalize your digital devices. All you do is order a back cover to your existing cell phone, pick a design, and they send it to you.

If you want to pimp your cell phone cover this Christmas, check out the designs at Coveroo. Starting at about $20, you can order a cell phone cover for your Blackberry, Motorola, Samsung, or LG engraved with one of 250 different designs. These range from tattoo-like patterns and silhouettes to comic characters and brand logos. (Sorry iPhone owners: No cover, no Coveroo).

At least Coveroo now has a clear business model, and a pretty cool product. Coveroo is taking submissions from artists and also does corporate logos. The five best ideas for new designs or new product extensions in comments will get a Coveroo with a TechCrunch logo.

Once the brainchild of Microsoft Research, Wallop joined the fray of social networks back in 2006 when the company’s CEO told the world that it wanted to compete with the likes of Facebook and MySpace, but do so by providing users with an unlimited capacity to upload digital media and have a revenue model that didn’t revolve around advertising, but instead it would revolve around the sale of “self-expression items.”

At that time, the company believed that everything was in place and it was ready to confront the world of social networks with a service that could easily compete on the same level as Facebook and MySpace.

Evidently, it was wrong.

Although there hasn’t been an official statement made by the company explicitly saying Wallop is dead, the company’s site now features a blurb saying site use will end September 18 and users will no longer be allowed to access their accounts after that time.

Dear Wallop.com Member,

Thank you for being part of the Wallop beta social networking site. We really appreciate your feedback and support. The beta period will end on September 18th, 2008 – after that date you will no longer be able to access your account.

Please check out our apps Cool Cards and Party On! On Facebook.

Thanks again,
The Wallop.com Team

An email was sent to the company’s press address to see what would come of it after that date, but the email address was removed from the company’s bank of addresses — another telltale sign that the service is dead.

Wallop will still live on in two Facebook applications though. On the company’s site, it’s still promoting its Cool Cards app, which lets Facebook users send animated greetings using their own audio, pictures, and video to friends. It’s also promoting its Party On! app, which lets Facebook users send animated party invitations to their friends.

But as a social network, Wallop has entered the deadpool.

Wallop is a Flash based social network that will compete with Myspace, Facebook and others that I mentioned in a post yesterday. It includes free unlimited storage for people to upload photos, videos and music.

Unlike the other social networks, Wallop CEO Karl Jacob says he has no plans to ever put advertising on the site. It just lessens the user experience, he says. Instead, Wallop wants a piece of the $3 trillion per year U.S. market for self expression items (clothes, furniture, beauty supplies, etc.). As sites like Cyworld have shown, people are willing to spend money for online expression items, too (Cyworld brings in a reported $300,000 per day in microtransactions to its users).

So Wallop has created a marketplace for “self expression” items on the site. Flash developers can create items and sell them to users. Music clips, animated widgets, artwork, avatars, clothing for avatars, etc. will all be for sale. Wallop handles payments and DRM, and takes 30% of the sale price. The rest goes to the seller.

Marketplace functionality is still being built, but Wallop says they will have the ability for sellers to create auction sales for one of a kind items, limited edition sales, etc. in the near future.

Invited users will be given five invitations each that can be used to invite others into Wallop. More invitations will be given to users based on how active they are in the service. Look for the service to leave beta and open to the general public in early 2007.

Wallop is based in San Francisco and has 27 employees. They’ve raised a total of $13 million in venture capital over two rounds, from Bay Partners , Consor Capital and Norwest Venture Partners.

Screen shots of Wallop are below.

The new entity is led by CEO Karl Jacob, a Sun Microsystems and Microsoft veteran. Karl is a seasoned entrepreneur as well – this is his fifth startup (he was a founder or co-founder of On Ramp, Dimension X, Keen (now Ingenio) and Cloudmark). The new entity has raised a Series A round from Bay Partners. Microsoft will retain a “minority stake” with a non-voting board seat.

Not much is being disclosed about Wallop yet, except that it is significantly different than the existing Wallop project. I’ve seen a bit of what they plan to offer, and I’ll say that this is not another “me too” social network offering. And there are a number of unique business model twists that they aren’t announcing yet. The launch is scheduled for this summer. One interesting thing to note: the current Wallop site is all-Flash. hmmm.

Existing MyWallop.com beta users will not immediately be affected by the change.

The beta is closed and as I said above there isn’t a whole lot of descriptive information on the website. The Microsoft Social Computing website has a little more, and includes a couple of screen shots:

In Wallop, you can share photos, blog, and interact with your friends. Wallop is a research project that explores how people share media and build conversations in the context of social networks. We are currently conducting a small, real world trial of Wallop with small friendship groups. Therefore, membership in Wallop http://mywallop.com is limited to study participants until the trial is over.

I’ll be keeping an eye on this one. The other projects on the Social Computing website also look interesting.