Sep 28, 2009 9:10 am US/Pacific
Twitter Co-Founder Dorsey Invests In Foursquare
By CAROLINE MCCARTHY, CNET News Staff Writer
NEW YORK (CNET) ―
Twitter
just closed a massive funding round
that reportedly has given it a billion-dollar valuation. Meanwhile,
co-founder and chairman Jack Dorsey is making investments of his own:
he's one of the undisclosed angel investors in geolocation start-up
Foursquare, quite a few sources have told CNET News.
News of the New York-based Foursquare's venture round,
led by Union Square Ventures,
leaked earlier this month via an SEC filing. A source with knowledge of
the deal's terms said that about $200,000 of that $1.35 million in
funding was taken up by the angel investors, including Dorsey, but that
there are quite a few hats in the ring so none of them has a
particularly huge stake in the company.
Foursquare's executives have chosen to keep the names on the list quiet.
Twitter and Foursquare already have an investor in common: Union
Square Ventures, which participated in Twitter's Series A and B rounds
but
sat out on the most recent one. AllThingD's Peter Kafka speculates that
a $100 million funding round may have been out of the question for Union Square, which specializes in early-stage investments.
Jack Dorsey, meanwhile, was Twitter's inaugural CEO, but
stepped down in favor of fellow co-founder Evan Williams, a more seasoned tech industry veteran, about a year ago. Dorsey remains
an important face of the company even as he works on his next company, reportedly a
mobile payment gadget start-up code-named "Squirrel."
A source with knowledge of New York's start-up scene says that
Squirrel's real name will actually be "Square." No relation to
Foursquare. We think. (Dorsey wasn't immediately available for comment.)
Side note: Squirrel, or Square, or whatever its final name is, may
be headquartered in New York rather than the Bay Area. That may have
been what set into motion some erroneous rumors this month that
Twitter itself would be relocating to New York. Twitter's definitely hunting for new office space to house its
rapidly growing workforce, we hear, but it's staying in its home city of San Francisco.
But back to Foursquare. What's interesting is that Twitter's application program interface (API)
will soon expand to include geolocation data,
something that could potentially make it compete with the core business
of Foursquare--a tiny start-up that was basically built from the ashes
of
ill-fated Google acquisition Dodgeball and launched this year
at the South by Southwest Interactive Festival. Dorsey's investment is obviously personal, not on behalf of Twitter, but now he's got a stake in both companies' success.
(© 2010 CBS Interactive Inc. All rights reserved.)
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