What: Microsoft Corp. made a US $15 million investment in Foursquare.
Why it matters: Microsoft will add features to its Windows phone software, such as the voice-activated assistant “Cortana” and offers targeted to the user’s location.
Microsoft Corp. has invested US $15 million in Foursquare Labs Inc., building a partnership that will help Windows-powered phones offer restaurant and entertainment suggestions to consumers.
The investment is part of a funding that valued New York-based Foursquare at more than US $600 million last December.
Following the investment, Microsoft will add features to its Windows Phone software to match with Apple Inc.’s iPhone and Google Inc.’s Android software, which together dominate the smart phone market.
A voice-activated assistant named “Cortana” will provide data from Foursquare. In December, Foursquare raised US $35 million led by venture fund DFJ Growth. The company spent the year adding products for businesses to advertise to its users as well as ways to send instant and relevant recommendations to people. Currently, Foursquare has 45 million users, compared with more than 230 million for Twitter Inc. and 1.2 billion for Facebook Inc. Through this deal, the company will get a new stream of data licensing revenue from the partnership.
The investment was confirmed by Foursquare Chief Executive Officer Dennis Crowley. “This is huge validation for the stuff we’ve been working so hard on. It’s one of the leaders in the space we work in looking at us and saying we can really help power the next generation of devices,” Crowley said. Microsoft will gain access to more of Foursquare’s data as part of the deal. That data would allow Microsoft, with a user’s permission, to push out tips, suggestions and discounts tied to a person’s location.