They may not have won the social networking wars, but San Francisco-based Tagged remains an interesting, profitable and independent player in the space. The company says it’s currently on a $40 million revenue run-rate this year, up from $30 million last year on the back of advertising, virtual currency sales and subscription fees.
Like other social networks, the company has to date viewed its mobile presence as a companion to the web. But it’s gradually adding new bits and pieces that will lay the groundwork for its apps and mobile website to help users meet new people — the core unique value the company says it offers.
Today Tagged launched a new mobile website at http://m.tagged.com, and overhauled its Android app to let users play games on the network and buy virtual currency, called Tagged Gold, from their phones through Paypal. The new mobile website lets users handle some essential features like friending, sending messages, viewing profiles and playing a dating match game that the company developed in-house.
The moves come at a time when mobile usage has septupled in four months. About 10 percent of the company’s overall daily active users access the site through a phone now. For reference, Tagged has about 10 million monthly active users who log into the site spread throughout the world.
Tagged’s usage leans a little more toward the mobile web and Android than the iPhone. Forty-six percent access the site through the web, 32 percent through Android and 28 percent through an iPhone. The numbers add up to more than 100 percent because some people use more than one method.
This is a little different from what we see on Facebook, where about 60 percent access the site through the web and where iPhone users outnumber Android ones by almost two-to-one. (Facebook’s iPhone app has 71 million monthly active users compared to 34.7 million on the Android app.)
Tagged is a seven-year-old company that was born around the time that Facebook was, but of course, it was later eclipsed by its rival. Unlike many other social networking companies though, Tagged hasn’t suffered the reversal of fortune that MySpace has or the gradual demise that other lesser-known rivals have faced.
Chief executive Greg Tseng really emphasized the company’s ability to “control its own destiny” in a conversation yesterday. Tagged only raised $12 million in venture funding from Mayfield Fund and others, so the founders and early employees presumably haven’t given up so much control to investors. “We haven’t needed to raise any more venture funding,” he said. “This has gotten us to profitability.”
Tseng said he’s focused the company to be in an “IPO-ready” state, although that doesn’t imply that Tagged plans to go to the public market.
“We do have that as an internal milestone. I purposely say that because it puts us in an elite class of companies,” he said. “Once you get there, all the options are available. We need to reach at least $50 or 100 million in annualized revenues and be a profitable, growing and predictable business.”
Tseng said Tagged’s user base is stable, but that the company had put user growth on the back burner in favor of monetization. That said, he’s hoping to focus on it again this year and start up a growth team as he hires more employees. The company has about 65 people right now.