SAN FRANCISCO, July 25 (Reuters) - After three years and hundreds of millions of dollars in venture capital funding, Foursquare says it has a way to finally make money.
The social networking company said Wednesday it is launching a "promoted updates" feature that allows businesses and merchants to push specials and deals to nearby users. It represents Foursquare's first attempt to monetize its user base of 20 million people, who broadcast their location to friends on the social network via "check-ins."
One of the more high-profile start-ups to emerge from what is known colloquially as "Silicon Alley" in New York, Foursquare has taken more than $70 million in venture capital. It made news in 2011 by snagging investment at a reported valuation of $600 million without demonstrating a business model.
The company garnered attention as one of the early geo-location-based apps, a field that tech investors believe will expand as smartphone adoption proliferates.
In a blog post Wednesday, Foursquare touted the feature to users as "a great way to find out what's happening at a local coffee shop, save money on your next clothing purchase, or just discover a store you've never been to before."
Foursquare said that companies including Best Buy, Gap and Hilton Hotels will participate as part of the program launch.
Reporting By Gerry Shih; Editing by Leslie Adler