Wowd Assets Split Up Among Three Companies, Including Facebook

Social search start-up Wowd has shut down, with Facebook “acqhiring” seven of its engineers and licensing its technology, another company outright buying its patents, and a co-founder starting a new company based on some of the same ideas.

Wowd, which launched in October 2009, was initially a peer-to-peer search engine, where users contributed their Web page visits in real time, but when that didn’t succeed it pivoted to be a news feed filtering service. The company was based in Palo Alto, with much of its development in Serbia. It raised $5 million in two rounds from Draper Fisher Jurvetson, KPG Ventures and Stanford University.

But the start-up only had “a few million users” and “we weren’t growing fast enough,” said Wowd co-founder and former CEO Mark Drummond, so it started looking around for other options earlier this year. It turned out that multiple companies were interested in Wowd’s technology, particularly two fast-track patents Wowd had received, one for ranking Web pages based on how people use them, and one for a distributed file system (here’s a story I wrote at the time they were awarded).

Facebook was interested in not only the technology but also the people who made it, so it ended up licensing the patents and hiring seven Wowd engineers, who are moving from Serbia to California. (A Facebook spokesperson confirmed the hires.)

Then a “large publicly traded company” got wind of what was going on and arranged to buy the patents outright, agreeing to uphold the Facebook licensing. Drummond would not disclose what company this was, but said that deal closed less than a month ago. The U.S. Patent and Trademark Office has not yet posted a record of the new owner.

Meanwhile, Drummond was still inspired to continue working on news filtering, having had the insight that it would be a better fit as a mobile app than yet another Web site. “The mobile experience of social data is actually completely different than the desktop experience,” he said.

He’s started an entirely new company called Jildy to do exactly that, and Steve Jurvetson of DFJ and Vince Vanelli of KPG have again agreed to invest. And like Facebook, Jildy has a license to use the Wowd patents, which are now owned by this unnamed public company.

Jildy hired another five of the Serbian developers and added a mobile-focused developer in Palo Alto. Wowd co-founder and former CTO Boris Agapiev is now an advisor to Jildy.

(To close the loop, Drummond said another 15 of Wowd’s Serbian developers did not get jobs at either Facebook or Jildy.)

Got that? A company shuts down, its employees go to Facebook and a new start-up doing a mobile version of the same thing, and someone else buys the patents and licenses them to both.

In the broader context, what happened to Wowd is interesting because it’s yet another poor outcome for real-time search, which just a few years ago had seemed like a wide-open space of opportunity. Most every real-time search product, including those from Collecta, Ellerdale, OneRiot and Google, has been shut down.

Photo of Mark Drummond by James Duncan Davidson for the Web 2.0 Summit 2009, where Wowd was first announced.

Please see the disclosure about Facebook in my ethics statement.