While Twitter and Facebook spar, Path, Foursquare, Tumblr, Quora, and Nextdoor should Voltron it up

By Sarah Lacy , written on December 26, 2012

From The News Desk

Most vertical or niche versions of popular consumer websites fail. A few have ho-hum exits. But I'm hard pressed to think of many that become truly large companies.

The biggest exception might be LinkedIn, which I'm sure was pitched as a Friendster for work at some point back in the day. Not only did LinkedIn survive -- it outlasted the original company it was compared to and the entire early wave of social networks.

So I wasn't surprised when Dave Morin of Path invoked LinkedIn and its founder Reid Hoffman as a role model when we talked about Path's new search features last week.

Like LinkedIn, Path hasn't been an overnight success. But it's grown through constant iterations and an absolute refusal to sell or even "pivot" from its core goal of being a smaller, more intimate social network.

Path didn't do itself any favors by initially limiting the virality of its site. LinkedIn similarly refused to add photos, or other features of more fast growing social networks, long after they'd be proven to goose MySpace and Facebook's growth. But while a lot of restrictions like sharing Path missives on other social networks and the number of people you could be friends with got eased with time, it was better that than look like a poor-man's Instagram.

Path has long struggled to prove it's something different. And until everyone's moms, aunts, and uncles are actually on it, it's worked on new features like search to make the experience feel more intimate and special.

The vision makes total sense. We all have overcrowded, overfriended social networks. We have mass groups of associates and people we met once and people we work with and people we used to know nailed. We don't have tight circles of our closest loved ones represented in the online world. And everyone has always lauded the site's design. But most people I know who have Path on their phones just don't regularly use it. To Morin's credit, perhaps, that sounds like the most common complaint about LinkedIn even today: There's just not enough reason to use it.

And, like LinkedIn, Path is aiming for a freemium model. If it can just give you reason to pay for premium features -- like LinkedIn did with job seeking and InMails long before Facebook was charging for emails -- it might not matter that you open Instagram more often when you want to share a filtered photo.

But no matter how much Path achieves, like LinkedIn 10 years ago, its future remains uncertain. It'll likely take profitability, same as LinkedIn in the mid-2000s, before we believe this site is here to stay.

Path isn't alone in its predicament heading into 2013. I can think of at least three other alternative social networks that would love to be the next LinkedIn, as Morin defines it: Foursquare, Quora, and Nextdoor. You could probably lump Tumblr in there too.

Still somewhat under the radar, Nextdoor is the clearest analog to Path, even though it's certainly younger and smaller. It aims to be the social network of real-world neighborhoods. Talk about something that's inherently not viral. Nextdoor has relied more on stickers than SEO. And I don't mean "stickers" as a new way to talk about badges. I mean physical adhesive things you put on the door of your local coffee shop.

If you thought getting your mom on Path to look at her grandkids' baby pictures was hard, getting people united to you only by where you all chose to live will be even harder. But there are similar reasons why they should want to be connected, particularly as local and community newspapers wither. There are commonalities and concerns that people living among each other have that they don't share with broader social circles or even extended family.

Both Quora, Tumblr, and Foursquare are slices of social -- less from an audience point of view and more from a functionality point of view. They are tailored experiences towards doing things that you could kinda do on other social networks but not nearly as well.

In his PandoMonthly in October, Dennis Crowley gave us one of the best articulations I've heard about where Foursquare is going, and while Quora has remained relatively quiet, I did an in-depth story on where their users are taking them earlier this year.

Unlike quiet Nextdoor and continually controversial Path, FourSquare, Quora, and Tumblr were all former darlings of the Web era that have since started to look dusty -- at least in the early adopter circles.

All five of these companies have a premise that is unique, a rabid base of fans (to varying sizes admittedly), founders who are determined to let their vision play out, and more to the point: They've raised large amounts of money from big name firms, many at sky-high valuations.

The pressure on these five is high. Most of them are well priced out of range of an acqui-hire -- even a pricey $125 million one like Google already offered Path and Path rejected. Nextdoor, Path, Foursquare, and Quora are all led by entrepreneurs who've already had some level of success and have something to prove with these ventures. And when it comes to Tumblr and Foursquare even more is riding on them: The hopes of the entire New York consumer Web startup ecosystem.

There is no going back for most of these companies, without a sale for a lower-than-hoped-for valuation a la Ning or Slide -- companies that struggled with similar dilemmas in the earlier wave of Web 2.0. We're beyond simply pivoting to an enterprise model here.

My prediction is some of them will work together more than they'll pull apart in 2013. How? Sharing their own unique troves of data at a time when Instagram, Facebook and Twitter are walling off their own gardens at the expense of users and fighting with one another -- and developers. By combatting the "it's our data now, take it or leave it" approach, these smaller social five could provide some alternatives that developers and tech insiders champion even if users don't abandon the big guys right away.

Smart underdogs rally advocates by driving an emotional or do-the-right-thing wedge between themselves and the big guys. It's a clever way of exploiting an advantage that a Twitter or Facebook -- who have to put up gargantuan ad numbers at this point -- just don't have. It's not too different from how PandoDaily can take an anti-page view stance versus our competitors and just focus on quality events and editorial. We don't have a legacy business to uphold; we are building from scratch so we have a lot less to lose.

This was something I first thought about when I spoke with Morin last week. Its new search product relies heavily on imports from Facebook and Instagram -- and I don't think anyone can rest easy who is relying on that right now. But it also wisely relies heavily on Foursquare.

One of the coolest aspects of the Search feature is discovering other friends' moments that happened near where you are now. Path doesn't need Instagram or Facebook for that. And although Foursquare is fighting its own battles, the company's core vision overlaps with Path very little. It should be incentivized to help several of these players chip away at the big social guys' hegemony, while giving its users more value to a Foursquare check in beyond the now stale game mechanics of badges and mayorships.

The potential tie-ins between a Foursquare and a Nextdoor seem obvious as well, as both focus on neighborhoods. How Tumblr and Quora work into the mix is uncertain. But like Path, both are about sharing more than just 140 characters or a photo, but each has a slightly different raison d'être aside from finding a way to survive in a Facebook-Twitter world.

Morin and I talked about how much partnerships in the social world have changed since 2007, when he helped pioneer Facebook's open platform. Back then, it was Facebook that was driving the wedge between itself and closed-off MySpace by opening up its social graph to the developers of the world and kicking off a wave of every consumer Web company wanting to be a platform. It worked, and even if Facebook has subsequently gotten mixed reviews on how nice it plays with others, it has helped spawn companies like Zynga and given countless others a powerful, global distribution engine.

But no doubt, a lot has changed since then. "Things are different now," Morin said, as we mused about the past five years as social has grown up, gone mainstream, and gone public. "The most important thing going on right now is that companies like us are really focusing on serving the users. This is even more important when openness isn't as prevalent as it once was. You have to partner well and have trusted relationships with users, with partners, and with employees. Look at the stuff going on in the past couple weeks. That erodes trust. I think everyone is going through this in certain ways. It seems like the business is changing."