Wallop, a social networking site, launched today, as reported by TechCrunch. Wallop was developed by Microsoft Research and spun out as a stand alone startup through Microsoft's IP Ventures Group. The group has spun out or licensed several research projects and has a growing list of available technologies.
Wallop is visually appealing and customizable by the user. In fact, customization is the business model. Wallop will sell customizable widgets (graphics, avatars, clothes, music clips, etc) so users can create their own identity and personalized space.
Flash developers are encouraged to build cool new widgets that will be available to all Wallop users in an on line marketplace. Wallop keeps 30% of the revenues and pays 70% to the developer.
Wallop will not have advertising in or around personal spaces. The business model is based on attracting a large user base, providing a free environment, and up selling customization tools and widgets.
Wallop is a community built by invitation only. Thats right...you need to be invited to join. Each new member is given 5 free invitations that they can distribute. More invitations are earned based on activity. The idea is to create an exclusiveness to the community and infer value to the invitations. Interesting concepts.
Wallop CEO Karl Jacob is an experienced entrepreneur. Karl raised $13M from Norwest Venture Partners, Bay Partners , and Consor Capital. Microsoft has a retained a minority interest in Wallop.
Wallop has a lot of competition. According to Hitwise, MySpace has 83% market share in the social network space, followed by FaceBook at 7%. Facebook dominates the college crowd, while MySpace is the rage with high school kids, teenagers, and college kids as well.
The competition is tough but the market, and payoff, is huge. Both MySpace and Facebook are believed to be worth more than $1B and have advertisers drooling. Even a small piece of this pie is very valuable.
