Ello Raises $5M in VC Funding to Fuel Plans For Growth and Redesign

With the latest round of funding, Ello plans to add more staff, build a mobile app and make good on its promise for more features.

Late last year Ello — a social startup that declared users were not a product — became an explosive success when Facebook’s real name policy resulted in user accounts being shut down. Ello experienced some growing pains and promised many new features. Now with investment funding, the company should be able to deliver on its promises as it continues to grow.

Since launching, Ello raised a total of $11 million in VC funding, $5 million of which it raised in a recent funding round and plans to use to add community managers, build a mobile app and redesign the site, according to the Observer.

In keeping with its manifesto, Ello has no plans to generate revenue from ads. Instead the burgeoning startup is aiming for a freemium model.

Techstars managing partner and Ello investor Mark Solon told the Observer:

Based on our growing number of users, people are exhibiting the desire for an ad-free network where personal data isn’t bought and sold for profit. That’s our investment thesis: People want to pay for that.

Freemium features on offer could include a different look for the site, and multiple simultaneous account signins. Ello is also working on a mobile app slated for release soon, which may in the future contain freemium features. Ello is also revamping the front and back ends of the site in an upcoming update, due by the end of May.

Jack Smith IV reported for the Observer:

The new site has a full-screen display, private messaging, private groups, the ability to [love] posts, more robust searching, and the ability to comment with photos and videos.

Ello is still very much a beta product, and it won’t be launching as an open platform any time soon according to founder and CEO Paul Budnitz. It may be a long time before services like Ello begin to outclass more established networks like Twitter and Facebook. But with continued growth, new features, VC funding and a revenue model beginning to emerge, Ello is in a strong position.

Readers: Would you pay for Ello’s proposed freemium features?