09/28/2010 10:37 am ET | Updated May 25, 2011

Swipely CEO Angus Davis On Social Shopping, 'Delusional' Microsoft, And The Swipe He Deleted

Angus Davis never graduated college, joined Netscape at age 18, and sold his first startup, TellMe, to Microsoft for an estimated $800 million to $1 billion in 2007.

Now Davis is back at it with Swipely, a new social shopping service of which he is founder and CEO. The company has been called everything from a "disaster waiting to happen" to an idea that "just makes sense."

Swipely, which has been open to the public just five weeks, aims to "turn purchases into conversations" by linking users' credit or debit cards to the site, then importing purchases and giving users the option of sharing their buys with their friends on Swipely, Facebook, and Twitter.

When you post a "swipe," you have the option to add a photo of what you've purchased (by uploading your own snapshot, choosing from an existing catalog of pictures, or consulting Swipely's catalog of products), as well as to include a rating, review, and explanation of the purchase. Davis calls this additional information the "story behind the purchase." (Davis and I met at Starbucks, where, according to Swipely, he purchased a Mocha. He said in his swipe, "This particular starbucks has some tea blends the others don't usually carry, but I stuck to my usual :-).") Because of credit card payment networks, the purchases do not appear in real time, but a day or two afterwards.

Davis says the company has tried to lower the barrier for participation: rather than requiring users to pull out their phone and manually check in, as with a service like Foursquare, Davis says that "by linking [Swipely] with a credit card, we [can] fill out the form for you, and you can add your own rating and review." However, the credit card sync may spook some users, especially after Blippy, a similar service, exposed four users' credit card numbers in Google search results.

Davis met with The Huffington Post for a Q&A about everything from startups and Steve Jobs, to social media and sharing. Read the interview then weigh in: would you use Swipely? Why or why not?

The Huffington Post: Some have wondered what benefit Swipely offers them. If you were talking to a doubtful prospective user, what would you tell her?
Angus Davis: There are four things. First, [Swipely can be used] to recommend and review places they go. People naturally want to tell their friends about things they've found. [...] Some people are more introverted and don't want to influence their friends, but a surprisingly large number do want to. The flip-side of that is there are people who want to discover new things from their friends. We've found countless examples where people see something from a friend on Swipely. [...] For some it's a way to start earning loyalty points or rewards, even if they don't have any interest in teling people how they shop. [...] The fourth reason [is] having fun.

Given all the information users are sharing with Swipely--everything from doctors' bills to pharmacy purchases to snacks, as well as access to their credit card accounts--I'm curious to know what is your stance on users' privacy online?
The deal is we won't share what you've purchased unless you specifically approve it. That's the critical part about privacy--Every company makes a "deal" with its users. [The reason that] Facebook has had a lot of criticism over privacy is that they're constantly changing the deal. If you've been away from Facebook for a month, you may not know that your friend can check you into this place you didn't. There's a give and take when people want to move the lever without people's consent.

So have you ever deleted anything you've swiped?
I went to the Lobby conference, and it turns out you're not supposed to tell people that you
go to the Lobby conference.

What are you surprised to see people sharing on Swipely?
I had a friend and he and his wife are having a baby. He had to pay for the sonogram and from the OBGYN's office, he posted a swipe with a picture of the sonogram. Certain swipes we blacklist--like a check, or an ATM withdrawl. At one point we said maybe we shouldn't let people see swipes from medical things or stuff like that.

How many users do you have?
We haven't announced specific user numbers yet, but it's in the thousands and growing pretty fast. We haven't done a ton of marketing up until now. We want it to be a great experience when people come in.

How did Blippys credit card incident affect you?
Given the fact that we're both in this broad social commerce space--and, at least today, the two sites are doing similar things--it definitely underscores the importance of the steps we're
taking on security. Before we had a single user on Swipely, we had already done all the
security stuff because we wanted to make sure that would never happen. [...] I think any time you're dealing with financial information, you're asking people to trust you and I don't take that lightly. That's why we made a major investment in security--We're doing that because we never want to put security of our users at risk. [...] However, we don't have access to your credit card number, the only thing we have ability to do is download the list of places you've had transactions.

In your experience, how is starting a company today different than it was when you were getting started with TellMe in 1999?
Back then, there were a few big differences. First, there were the hardware and infrastructure costs. You had to buy it yourself, whereas now you can rent from Amazon, Rackspace. Second, we wrote all kinds of software that's now available as free, open source software, so starting Swipely we leveraged lot of free software that we would have had to hire 20 people to write. The means of aquiring customers for your consumer offering is much different. Back then, you'd have to raise 10 to 20 million for advertising. [...] Now you can acquire consumers via social media, or more optimized channels [...] You could have done it with Google ads instead of doing TV commercials. Cloud computing, open source software, and social media have dramatically lowered cost of starting a company.

Are you thinking about integrating Swipely with Foursquare?
Absolutely, especially if we could get our service to be closer to real time because you could check in just by swiping your card. Frankly, though, I think that's a ways out.

So I notice you have an iPhone 4, even though you sold your company to Microsoft? No Kin?
Even some of the senior people who run the WinMo team have an iPhone! In Redmond, they are a little delusional, they didn't see the iPhone coming. I remember going up with my iPhone and people were still parodying the thing Steve Ballmer said when it launched. And they'd say, "Oh, you actually type on that thing?" This is the hottest technology in the world right now, yes, I type on it. So sometimes there's a little bit of an insular [view].

It would help Microsoft to get out of there, maybe unhook the exhaust from intake a little. But you know that it's an amazing company. There's no question. But they have spent a lot of money trying to compete with Google and Apple and personally, I think they have so much opportunity that is beyond those areas. It's sometimes frustrating to watch [them spending] half a billion every quarter [...] trying to catch up to Google.

What would be your advice to Microsoft?
The office productivity software they have is phenomenal, the Windows operating system
is still the dominant OS [...] I think that social is a still a relatively high growth area that they could be tapping into. For example, I think Bing does a much better job of integrating Twitter [than Google]. The maps and geo-spaces stuff is arguably better in many respects than what Google does. The gaming stuff they do with Xbox is awesome. If I were them I'd worry about building on my strengths rather than trying to catch up to the iPhone and Google.

Free response! Tell me the first thing that comes to mind for each of the following terms.

Steve Jobs: I think he'll be remembered the way we think about people like Edison and Ford. I think he's the most inspiring innovator in my generation. I think he's a brilliant inventor.

Blackberry: Looking for a buyer.

Mark Zuckerberg: Thumbs up. He's somebody who has built an incredible platform [...] There's an entire Valley Wag site being written about this guy, which I don't think is fair. I don't know him. There's all these things being said about him as an individual. I think it's amazing there's this platform so many people use, love. I have no opinion outside of being
impressed with that accomplishment, but I'm surprised with how much gossip gets written about him.
Why do you think that is?
It's almost like he's a politician. [...] For whatever reason, people think that it's fair game for that tech executive, but not for others. Unless it impacts the business, I don't see why it matters.

"The Social Network": I think that people like you and me will be interested in it and think
about it [...] Inside the echo chamber, it'll be talked about, but outside I don't think people really care.

Twitter: Revolutionizing the way I get my news and info.

Facebook: Could be more important than Google, we'll have to wait and see.

MBAs: Back to banking.

Foursquare: Fun at first, we will see what happens.

Android: I've been surprised with how fast it's growing, but I think fragmentation within
risks undermining the success of the platform. There's a different flavor everywhere. It's starting to be like Java.


Swipely from Swipely on Vimeo.