Matthew Mandel

Why haven’t big consumer businesses been built around the Find My Friends’ (FMF) location-sharing primitive?

Lots of people my age share their location with as many as tens of people. The behavior has caught on despite no marketing or real productization from Apple. Location feels like a powerful piece of data, and the organic consumer demand for the product is real. It’s suspicious though that we’ve had the technology for a decade and no one’s meaningfully extended FMF or built a large standalone competitor. 

I think the best explanation for why that hasn’t happened is that one’s location is simply too valuable to be shared widely. Ironically, it’s because these platforms create such a valuable piece of data that the size of the networks they facilitate is inherently constrained. FMF ultimately looks more like a SaaS tool that small communities use for their own purposes than a platform that unlocks new large networks. 

Good businesses can be built serving small communities, but they function very differently than the social media giants of the last twenty years. Traditional social networks attract tons of users and get them to generate as much unique data as possible to create value across the network. If there’s no larger network benefiting from a group of friends using an app to share their location with each other, they’re capturing all of the value and so have to be willing to pay for it.

USV portfolio company Tribute Labs does something like this by selling into DAOs, which are smaller self-contained communities and often willing to pay for services that make doing their core group functions like trading easier. Web3 more generally potentially cuts across the community size vs willingness to pay trade-off by introducing ways to natively inject economics into consumer behaviors.

There’s potential for venture-scale businesses to be built around intimate social networks, but there has to be some kind of business model innovation to overcome the fact that they don’t benefit from Metcalfe’s Law in the same way as the large incumbent social networks.