Social networking site Tagged is no longer going for an IPO. Instead it’s renamed itself if(we), acquired little known messaging app startup Tinode for an undisclosed amount and has completely changed direction to become a social app incubator. If(we) is essentially a brand new company, now acting as a parent brand to Tagged and social gaming site Hi5.
Tagged was on a high growth course for a number of years and the money had been rolling in. According to some accounts, revenue was up 30 percent year-over-year. We reported the site was projected to grow to $45 million in revenue back in 2011. The company founders were reportedly aiming for a $1 billion IPO.
Then everything shifted away from Facebook gaming and desktop sites to mobile. This is when both users and revenue began to drop off, according to sources. Co-founders Greg Tseng and Johann Schleier-Smith tried at first to shift into going mobile first, but that didn’t seem to work either. Revenue slid from $57 million last year to a projected $51 million this year, according to the San Francisco Business Times. The numbers were no longer where they needed to be for an IPO to make sense. Tagged canned the idea of going public and instead has refocused the company to mobile only. It also decided to completely rebrand with a the new name and logo and make Tagged a product offering rather than as a standalone company.
Tseng believes this shift is a chance to go back and essentially start over. “We’ve been working on social for more than a decade and experimenting is in our DNA. We’re excited to return to our startup roots on a quest to create the next billion user social product,” he wrote in a statement to TechCrunch.
This might seem like an odd strategy. Tagged hasn’t had much success in mobile. Apps like Sidewalk and Swoon were a little too niche, a little too late to the party and were introduced into already crowded categories. Sidewalk was a dating app that only covered the SF area, for instance. There was already a plethora of dating and hookup apps in the space and Sidewalk failed to get enough interest to make it work. It shut down not long after launch.
But with the new name, comes new engineering power. Former founder of Tinode, Dash Gopinath is now the new if(we) chief product officer. He has a background in running product for Yahoo! Badoo, Digg and Top Prospect for nearly a decade himself. Sources close to if(we) say Tagged had been trying to woo him and his team for a couple of years now. Gopinath is banking on the mobile market to help the company grow. “Over 1.2 billion people around the globe use mobile devices and this number is sure to double in the next five years. There is more of an opportunity than ever before to build a social product that appeals to the broader consumer base. Greg and his team have always focused on building products that are loved around the world. With this background, I’m confident that if(we) has the right expertise, passion and determination to create products that connect people like never before,” he reaffirmed.
The plan is to incubate multiple social products. Some of the ideas tossed out have been to develop in the anonymous space, “ephemerality sentiment,” and to “push the limits of mobile.” Much of Tagged’s 140 employees will still work on the Tagged product, under the parent if(we) company name.
If(we) also confirmed it is already working on a messaging app as its first product. The new app is pretty similar to what Tinode was working on before the acquisition. The new app will incorporate much of the same messaging technology used in Tinode. Gene Sokolov, who also joins the new if(we) from Tinode, will be working as the new SVP of engineering.