If anyone ever tries to argue that capitalism is the most efficient way of allocating scarce resources and human potential, feel free to point them to Yo, the app which enables you to send the word ‘Yo’ to people and is now worth ten million dollars.
You might remember Yo, as it has been floating around for a few years. First launched in 2014, the app just closed $1.5 million in seed funding with a $10 million valuation. Its investors include Betaworks, Mashable’s Pete Cashmore, and the founders of China’s Tencent.
“Wait, is there anything more to it?” you might ask. “Is it just an app for sending ‘Yo’ to people?” Well, ostensibly not. The company has apparently started hiring a bunch of engineers and business development folks to milk the potential out of a simple alert-based app. They’ve tried brand partnerships in the past: for example, during the World Cup, you could set it so it would ping you every time a goal was scored.
But the core functionality, ultimately, is that you can tap on a friend’s name and then they’ll get a push notification and their phone says “Yo!” I tried it back in 2014 and it was interesting for about five hours, when everyone became fixated on sending as many Yo’s as possible to drain their mate’s battery.
CEO Or Arbel had a pretty inspiring announcement, especially considering the nature of the app. You’d think the bloke was working on a cure for cancer:
The value of this round goes far beyond the dollar amount that we received. Bringing such incredibly smart, talented, and experienced people into the Yo team at this stage is an incredible advantage that will allow us to accelerate the growth and provide more and better value to our users.
Why did these companies give so much money to this app? Is it because Silicon Valley is fundamentally insane place loaded to the gills with grifters and Ponzi schemers? Surely not. Betaworks CEO John Borthwick outlined the apparent value in this investment in a company blog:
We are fascinated by these uses of simple yes/no, on/off communications tools. As the notification layer becomes the primary interface of alert-based information on your phone — as the OS’s allow navigation and controls in those alerts — there will emerge a new class of applications that mediate this layer for web sites, other apps and connected hardware.
Do you ever get the sense we might be in another dotcom bubble? You reckon?
