Hearsay Brings Compliance to Social Media

Published on February 3, 2011
by Liz Gannes

Hearsay today launched a social media platform for companies that have both corporate brands and local representatives, with existing customers such as Farmers Insurance, State Farm and 24 Hour Fitness.

The San Francisco-based company helps its customers manage compliance with brand guidelines as well as regulations from the SEC, FINRA and the FTC. That’s especially important when local representatives and franchisees are networking with and recruiting their own clients under the banner of a corporate name.

It also helps these types of companies push out social media content for their local representatives to personalize, and analyze the effectiveness of their efforts on Facebook, LinkedIn and Twitter.

The idea isn’t to make social networking boring and corporate, necessarily, but rather to provide sample content to riff off and to flag inappropriate updates before they go up.

Hearsay stems from the work of co-founder and CEO Clara Shih, who wrote “The Facebook Era,” an early book about how businesses can use social networks. Shih then wanted to found a company around those ideas, and iterated her efforts until she found a fit. The company has been in stealth mode since 2009, but it is already cash-flow positive.

Hearsay raised a little more than $3 million in funding last March in a round by Sequoia Capital. Other investors are Michael Abbott (Twitter), Steve Chen (YouTube), Ron Conway (SV Angel), Nils Johnson, David Lawee (Google), Thomas Layton (former OpenTable), Dave Morin (Path), Patrick Pohlen (Latham & Watkins), Alberto Savoia (Google), Aydin Senkut (Felicis Ventures) and Aaron Sittig (former Facebook).

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