Dennis Crowley, founder and chief executive of Foursquare, will be stepping down as boss of the company after the latest round of funding significantly lowered its valuation.
Jeff Glueck, Foursquare’s current chief operating officer, will be replacing Crowley.
Crowley, who served as CEO of the company for seven years, has struggled to turn the location-sharing app around into a revenue-generating business.
“Our co-founder Dennis Crowley, whom many of you know personally if not by name, is stepping into a new role as executive chairman—a full-time position that’ll give him the professional freedom to do all the visionary thinking, creative brainstorming, new product launching and (of course) nonstop tweeting with you, his friends and followers and our valued community of Foursquare and Swarm app users.
“Dennis has tapped Jeff Glueck, who has served as COO for the past year, as our new CEO, in recognition of how Jeff has grown and scaled several businesses in the past and is ready to do the same for Foursquare.”
Brand new $45M round for @Foursquare & I step up to Exec Chair as @JeffGlueck & @Stevenjr76 step up as CEO & Pres :) https://t.co/m7ZC1x5kzG
— Dennis Crowley (@dens) January 14, 2016
Foursquare’s latest round of funding, led by Union Square Ventures, raised $45 million from new investors, including Morgan Stanley, and existing investors such as DFJ Growth, Andreessen Horowitz and Spark Capital.
A report published by Re/Code claims that the latest funding round values Foursquare at about $250 million. This figure is less than half of what investors thought the company was worth two years ago – in 2013 the company raised $35 million in a fundraising round which valued the company at $650 million.
The money will be used to “pursue growth even more aggressively”, according to Mr Glueck, adding that the company will hire 30 new positions across sales, engineering and other functions - so that it can expand to meet growing demand for its location intelligence platform.
Business focus to shift away from consumers toward the enterprise market
The company used to rely heavily of advertising, but never managed to generate as much as investors had hoped for.
It appears that under new leadership the company will shift most of its focus away from consumers in favour of the more profitable enterprise market. The company’s B2B platforms now account for most of the firm’s revenue.
Glueck posted the following in a recent blog entry:
“In the past 18 months, we have made enormous traction on this mission. We signed Apple, Twitter, Pinterest and others as customers, and have 100,000 more developers who rely on our location data.
“We just had our biggest revenue month, quarter, and year. Foursquare and Swarm, our consumer apps/sites have over 50 million monthly active users and daily check-ins are at an all-time high. We launched two new B2B areas which now drive the majority of our revenue: our programmatic ad platform Pinpoint and our Enterprise Solutions (Place Insights and Places tools for developers), which grew revenues 170% and 160% respectively in 2015.”