Foursquare isn't a huge operation -- on the back end it's just three employees running the business. How can three people build such an application? It requires lots of partnerships.
The Foursquare founders came up with the concept and created an application programming interface (API). They made this API available to developers for various platforms like smartphones. Before long, developers eager to work with the API built applications for the iPhone and the Android operating system. Foursquare employees didn't have to code the applications themselves, freeing them to work on other aspects of the service.
A major challenge for Foursquare is obtaining data about cities to store on the application's servers. In order to support a particular city, Foursquare has to collect and organize geotagged data. The employees reach out to several companies to flesh out each regional database. The process isn't necessarily speedy. On launch, Foursquare supported 12 cities. After a few months, the number of cities expanded to more than 20.
The founders chose to launch Foursquare at the South by Southwest (SXSW) conference in Austin, Texas. The conference is a multimedia event with programming tracks for movies, music and interactive software. Unleashing Foursquare at SXSW proved to be an effective strategy -- bloggers, journalists and others used the service to check in at various spots and keep tabs on what other people were doing. Many of them wrote about their experiences with the service and gave it an initial viral marketing boost.
Foursquare has some notable investors. One is Jack Dorsey, a co-founder of the popular Web service Twitter. Another investor is Kevin Rose, the founder of Digg. As more people adopt the service it will become increasingly valuable. If the founders can build a viable business model the investment could prove to be a savvy one.
In the meantime, Foursquare evangelists will continue to lure new members to the service. As more people take advantage of Foursquare, it becomes richer and more robust. And since anyone with a phone can play for free, the member roster will likely continue to grow.
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