Tech companies left for dead: Yep, still alive
SAN FRANCISCO — Iconic TV shows have a way of emulating life.
Silicon Valley captured the gestalt (uncomfortably so) of, well, Silicon Valley today. Mad Men chronicled advertising on Madison Avenue in the 1960s. Breaking Bad looked at the underground business of meth labs in the 2000s.
The Walking Dead has company in tech: Once high-flying start-ups left for dead are alive and kicking, pivoting to new markets, redefining themselves or simply soldiering on.
This month, Zynga announced a new mobile action game it insists will lead to a return to dominance. Anonymous app Whisper has pivoted to become a media company. And the company behind live-streaming app Meerkat has rebooted a new popular app among those under-25. Even Myspace, the king of zombies, is still kicking.
Exhibit A: Life on Air, whose wildly popular live-streaming app Meerkat was a sensation at SXSW in 2015 before the emergence of Twitter's Periscope and then Facebook Live, has quietly renamed its app as Houseparty, a group-video chat app, in February. It’s been a fixture in the top-10 in the App Store for a few weeks, with more than 1 million users daily.
“As an independent company, we had to change the direction of our company,” company CEO Ben Rubin, who categorized Houseparty as a new product, not a relaunch. The live-video app, he said, “(brings high school and college students) together in the best possible way when they are physically apart.”
Comebacks are a rarity in the fast-moving corridors of Silicon Valley, where today's groundbreaking idea is tomorrow's "so-what". Only a few companies have successfully rebounded from marketing missteps, a glut of competition or products that fizzled after briefly shining brightly. Apple and Priceline.com are among those to have persevered — Apple under Steve Jobs and a new hardware roster; Priceline under adroit acquisitions.
"It is really hard for social companies, which is all about your identity and friend group, to remain popular,” says Travis Katz, a former Myspace executive who is now CEO of travel site Trip.com. “Once (a consumer) decides (they) don’t want to interact in that space, it’s hard to go back — it’s like going back to an old girlfriend.”
And yet the demise of one-time sensation Whisper, for example, has been greatly exaggerated. Its 30 million monthly active customers open the app almost 20 times a day and spend about 30 minutes on it, according to the Venice, Calif.-based company, which opened an office in New York for its growing ad business after deals with Coca-Cola, Universal Studios and Dove.
Social media network Myspace a decade ago once had more members than Facebook a decade ago. But it was left for dead after it was sold by News Corp. — which acquired it for $580 million in 2005 — to Specific Media Group and Justin Timberlake for $35 million in 2011. It has since been dealt to Time Inc.
Now a property of Time, ad tech company Viant, has harvested millions of legit consumer email addresses on Myspace to use to target marketing material.
A Myspace spokesman referred to market researcher DMR for the most recent figures available on Myspace’s audience: 50.6 million monthly active users (as of Jan. 23, 2015) and 300 million monthly video views (as of November 2014). Myspace peaked at 75.9 million users in December 2008, according to DMR.
At Zynga, the question is whether the once-high-flying "it" company of the mid-2000s known for its mega-hit FarmVille — grounded since by disappointing financial results and a meager stock price — can revitalize its brand, and fortunes, with a new mobile game.
Dawn of Titans, Zynga's action-strategy game that debuted this month, is the San Francisco-based company's bid to appeal to casual mobile gamers and fans of PC strategy titles.
Whether the game catches on in a historically fickle market and returns Zynga to past glories is anyone's guess, however.
Such is the unpredictable nature of companies that refuse to die.
Follow USA TODAY San Francisco Bureau Chief Jon Swartz @jswartz on Twitter.