Townsquared: The SMB social network you never heard of

The private social network is only available in a few major metros, but the founders are confident the platform can scale to help connect small businesses in neighborhoods across the country.

In the 11 years since the now infamous inception of Facebook, the idea of a social network has taken on many forms. With designated online networks for crafters, athletes, musicians, professionals, chefs, neighbors and nearly every identifiable ethnic group -- there's hardly a niche still in need of its own Web community.

Except if you ask Rohit Prakash and Nipul Patel, co-founders of Townsquared, a private, community-based social network for small business owners.

The essence of Townsquared is not new. It's similar to Nextdoor, the private social community that gives people a way to stay informed about the happenings in their neighborhood. Townsquared does the same, except for businesses and their communities.

But what makes Townsquared interesting is not simply what it is now, but what it hopes to become as it scales to more business communities across the country.

In its current iteration, Townsquared is available in several local business neighborhoods around San Francisco and New York City. The team tells me that they do very little in terms of marketing and promoting the platform, and instead rely on word-of-mouth and the occasional brand ambassador to gain business users.

For the small business owners that do sign up, they gain access to something akin to a private discussion board, where they can alert neighboring businesses about things like supplier issues, rent increases, shoplifters, and local ordinances and taxes. They can discuss local politics and minimum wage concerns, recommend accountants and marketing techniques, or plan community events and shop shares.


While those use cases may seem like simple fetes that can be done on a more widely used platform like Facebook, Prakash and Patel highlight the privacy factor as what really separates Townsquared from the rest.

The platform is not indexed on Google and every Townsquared user is verified upon signup -- creating an environment where conversations remain off the record and between a select group of community members.

"It's all about creating this place where people can feel safe," said Prakash. "Our real goal here is to build knowledge for these businesses, because there's no need for a business to do all this work to try to solve a problem that has already been solved by somebody else."

Just about a year ago, Prakash and Patel raised $5.2 million in funding from private investors. The funding has since been used to expand the platform and its employee base, and the two founders say they intend to go for another raise later this year.

As far as the site's profitability, right now that's not entirely clear. Townsquared does not charge users for membership, nor does it allow any advertising or soliciting of products from within its digital walls.

But that's where things start to get interesting. While they were reluctant to giveaway too many details, Prakash and Patel said they plan to build value-added services for the businesses themselves.

This could include the ability to coordinate group purchasing for necessities ranging from coffee cups all the way to healthcare. That would essentially connect the disparate businesses in a local community and give them the purchasing power of a large company -- the potential benefits of which could be tremendous.

As Patel explained, that connectivity could offer "the kind of transparency that is helpful for these businesses ... so they can find common expenses and then find a way to bring them all together."

Prakash and Patel said those value-added services are still at least a couple of years from fruition. But if successful, they could put a unique spin on the power of a local, online community.