While everyone is talking about Facebook's IPO and the future of the company as a newly introduced financial instrument, the world of start-ups is busy leveraging Facebook to build new companies--and hopefully create new value.
Facebook has done a better job than any company in history at collecting personal (and sometimes intimate) information about nearly a billion people. And while the prevailing conversation today revolves around their plans of how to best monetize this through an ad platform, the world of start-ups is much less interested in that than the fact that Facebook Connect and Open Graph have enabled us to tap into the incredible source of information that they've gathered.
In the same way that Microsoft enabled thousands of companies to build software products for the PC, and that Google helped create a structure to discover new businesses and products online, Facebook has kicked the door wide open with respect to easily and quickly learning about people in a way that allows new products and services to be laser-targeted at solving real problems for them.
If start-ups get this right, it will mean less spam, richer experiences for users, more useful products, and an overall, a better Internet.
As impressive as what Facebook has done in the past few years is what it has chosen not to do. It has partnered with Oodle to deliver the Facebook Marketplace, with Spotify to help users find and discover music, and there's no doubt (at least in my mind) that it will be partnering with a financial institution or two in the future to enable new flows of money online. Facebook has committed to building a true platform, and every step it takes to improve it makes it more powerful to leverage.
So what's this mean practically?
At a company like Zaarly (the online marketplace I founded), we allow our users to sign in with Facebook Connect. When they do this, their profiles get automatically populated based on information they've already provided to Facebook. It's a login option that's not required, but it makes getting started on Zaarly a one-click affair.
In the next couple weeks we'll be launching a simple-but-useful Open Graph integration. This will enable Facebook users to see, non-intrusively, when their friends are using Zaarly. Hopefully this will lead to new, and better-engaged, Zaarly users. And a bit further down the road, we hope to leverage interests and experiences, as listed on Facebook, to serve up better and better recommendations to our users on how they can make the most of Zaarly. None of that is possible without Facebook and the tools it has created to enable innovation on top of their platform.
So ad platforms, privacy issues, and projected growth rates aside, the start-up world of new ideas and innovations has a huge leg up because of Facebook's dominance. And that's probably a good thing for Facebook too.