Microsoft Corp. invested $15 million in Foursquare Labs Inc., forging a partnership that will help Windows-powered phones offer restaurant and entertainment suggestions to consumers on the move.
The investment, confirmed in an interview by Foursquare Chief Executive Officer Dennis Crowley, is part of a funding round from late last year that valued New York-based Foursquare at more than $600 million, people with knowledge of the terms said in December.
Microsoft is adding features to its Windows Phone software in an effort to compete with Apple Inc.’s iPhone and Google Inc.’s Android software, which together dominate the smartphone market. Location data from Foursquare will appear in a voice- activated assistant, code-named Cortana, that has yet to be released and will go up against Apple’s Siri technology, according to a person with knowledge of the plans.
“This is huge validation for the stuff we’ve been working so hard on,” Crowley said. “It’s one of the leaders in the space we work in looking at us and saying we can really help power the next generation of devices.”
Foursquare, which has struggled to generate sales in almost five years on the market, will get a new stream of data licensing revenue from the partnership, Crowley said. Foursquare’s valuation has been stagnant since 2011.
Bloomberg News reported in August that Microsoft and American Express Co. were both vying for a stake in Foursquare. Microsoft has been courting startups to add features to its phones and tablets, which lag behind Apple and Android products in the number of applications available to users.
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