Way back in 2007, Facebook was like the wild, wild West. Once the social network made it possible for brands to connect directly with their customers, it became a natural place for businesses to plant a social media flag. For awhile it was a total land grab. Hosting Facebook contests and promotions became very popular and my company profited from the trend. At first it was because I ran a web-design business that built Facebook applications (e.g., contests and promotions) for a handful of clients. And then it was because I took the experience I had building those apps and created a software product that anyone could use to do the same thing.
My company has grown nicely for the last few years--going from 80,000 users during 2011, our first year, to more than 300,000 in 2014. But Facebook's constant changes--to its algorithm, its terms of service, and its promotions guidelines, including a new ban on like-gating--made it clear that we needed to be independent. As of today, our product still works with Facebook, but it's no longer dependent on it.
Here are four things I've learned about piggybacking a new product on someone else's, and why it's not a good idea.
1. You're building a house on rented land.
The minute you build a company or product based entirely on what someone else is doing, your destiny becomes tied to theirs. What's more, if you happen to gain some traction, the "host" company will be watching what you do and learning from it. Basically, you're doing free R&D for a potentially huge and probably already profitable company. And once you figure out what your users--who are by default also their users--want, the landlord is going to swoop in.
We had this experience last summer when Facebook all of sudden revamped its promotions guidelines and made it possible for anyone to host a contest or sweepstakes on their Timeline without needing to use a third-party app provider (like my company ShortStack makes). We can only presume that they were well aware of how popular contests and promotions were on Facebook and wanted to grab a share of that attention--and the advertising dollars used to promote them--for themselves. On the day Facebook made that announcement, there was a bit of panic in our offices. But ultimately it motivated my co-founder/lead developer and me to rethink our product and get to work revamping the software to make it platform-agnostic.
2. You exist at the mercy of the landlord.
For several years, businesses were hungry for software like ShortStack's since it allowed them to leverage their Facebook presence. But over the years we've felt hamstrung by Facebook's ever-changing rules and regulations. Facebook's desire to "move fast and break things" made it difficult for us to consistently provide a stable platform for our users. Facebook's policies affected the way people used our product, but we didn't have a say in their decisions.
We were often frustrated on behalf of our users when they'd have an issue with something, but there was nothing we could do to help them. They'd ask us why a certain feature that worked "last week" didn't work any more. Or why a mobile function was giving them trouble. It was never our policy to blame Facebook but it was aggravating to take the hit for something that had nothing to do with our product.
3. You can't improve the house without the landlord's permission.
Another frustration we've had to deal with over the years is Facebook's less-than-stellar mobile experience. No matter what we did to make the mobile experience terrific for users of our platform, they had complaints that always led back to issues with Facebook's infrastructure. Our new product isn't affected by Facebook's mobile challenges. Another benefit of making our product function independently is that we don't have to follow all of Facebook's rules and regulations, making it easier for our users to run streamlined campaigns and action-gate them in multiple ways.
4. Sometimes the landlord doesn't want you around any more.
The landlord will always change the rules to benefit him. Always. Facebook has made so many changes to its platform and the rules its partners have to follow, that some of them, like Zynga, finally were forced to move away from Facebook. Zynga has 265 million monthly active users who evidently love the company's games, but the company's move away from Facebook hasn't gone well.
While it's absolutely true that using rented land can help you launch a product and even bring in revenue, it's important to make sure you're being smart with the money and saving up to go from renting to paying a mortgage. I'm armchair-quarterbacking here, but it seems like Zynga should have started with Facebook all the while knowing they'd need to move on sooner rather than later, when they were forced to.
The biggest lesson here is that entrepreneurs are much better off putting time, energy, and other resources into building something they own. Your growth rate might be slower, but ultimately you'll have more control over what you build and how it's used. Don't get me wrong, we still love Facebook and the majority of our users still publish what they build with our software to Facebook. But they no longer have to, which ultimately gives them more control over what they build, what kinds of data they can collect, and what they can do with it.
I'm curious to know if any of you have built a product or service that's closely tied to someone else's. Do you regret it or has it helped you get your business off the ground?