A new social media startup is quite the black swan in Boston, as the Hub doesn't notoriously shine in this industry (with at least one, if not two, exceptions). But HelloFriend, one of the 72 startups in this year's Harvard Summer Venture Incubation Program, has great ambitions; in fact, it thinks it can do a better job at building a new social network – with a different business model – than Facebook itself.
More than ten years have passed since Facebook was a Harvard startup, as HelloFriend is now. From the Cambridge Analytica data scandal to April's Congress hearings, Facebook's announcement several months ago that it would be prioritizing “meaningful interactions” in its News Feed now seems to belong to a past age.
A quick refresher: in January, the company said that users would see more posts from their friends and family (and fewer posts from publishers and brands) thanks to a change in the algorithms working behind their feeds. The move was meant to encourage people to connect with friends and spend more quality time together—in the real world.
Many analysts and journalists didn't quite buy it. The contradiction, they said, was obvious: the company may want to encourage engagement among friends, but it makes money by encouraging interactions, meaningful or not, between users and brands. To make Facebook's business model work, users are targeted with advertising.
And this is the model that HelloFriend co-founders, brothers Shaban and Salman Habib, want to change. Specifically, they said they don't want to sell user data to generate revenue, and that they're using decentralization technology to make sure that users' data never leave their devices.
"We want to create an application that, fundamentally, focuses on the true meaning of socialization: for us, it is connecting people in real life."
"The goal was to create a social networking platform that is morally correct," Salman said. "We want to create an application that, fundamentally, focuses on the true meaning of socialization: for us, it is connecting people in real life."
As you can check out below, the company's video promo includes the words "meaningful connections" (1:05), which are reminiscent of Facebook's "meaningful interactions."
The business model that HelloFriend wants to build is based on both decentralization and a new, in-house built cryptocurrency. In fact, HelloFriend is not (or not only) a social network: Salman defines it as a "marketplace for social experiences."
Users of the platform fall into one of two categories: they can be "hosts" or "users," and switch between the two at any time. Hosts organize social activities, from house parties to advice over coffee or city tour guides, and charge participants a fee for taking part into the activity. HelloFriend makes money by retaining 10% of each transaction; specifically, the company only charge activity hosts—much like Airbnb.
The currency of the HelloFriend world is called Connect. According to Salman, users can buy Connect tokens using U.S. dollars, Chinese yen or any other currency, and than use it to take part in activities. Also, hosts can cash out Connect tokens "right away," Salman said.
Currently, HelloFriend has four full-time employees and three part time. After launching last summer and being selected as a finalist of this year's Harvard President’s Innovation Challenge, the company is conducting a private sale of Connect tokens to raise seed funding (Salman declined to disclose their target goal).
Salman said that they have 45 college ambassadors, who will start posting activities as soon as the platform comes out, at schools like Harvard, Duke University and Virginia Tech. Around 150 more students sent an application to become college ambassadors for HelloFriend, Salman added.
The platform is expected to launch as an iOS and Android mobile application in selected college campuses in early August, and nationwide in September.
