Flush with a reported $5.5 million in fresh funding, upstart social network Ello today legally changed its corporate standing to back a promise to remain ad-free. Ello converted to a public benefit corporation, which it described as “a new kind of for-profit company in the USA that exists to produce a benefit for society as a whole — not just to make money for its investors.” Also Read - Tencent is looking to invest about $650 million in Swiggy along with existing investors
The announcement posted at Ello’s website came as word spread that venture capitalists pumped $5.5 million into the company in a fresh funding round. That money will be used in part to beef up capacity so the social network can be opened to more users. Ello, described as the “anti-Facebook” for its stand on privacy and advertising, has become a hot ticket on the Internet. Also Read - Uber more than doubles the size of Series E funding round to $2.8 billion
Created last year as a “private” social network, Ello recently opened its doors on an invitation-only basis. Ello appears to have caught on with its simple message which seems to take aim at frustrations of Facebook users. Also Read - NewsHunt raises Rs 250 crore in Series C funding
Facebook has been criticized by some users over its privacy policies and ads that use personal information. “Ello doesn’t sell ads. Nor do we sell data about you to third parties,” the company says.
Its “manifesto” states, “We believe a social network can be a tool for empowerment. Not a tool to deceive, coerce, and manipulate — but a place to connect, create, and celebrate life. You are not a product.”
Ello’s policy states that the practice of collecting and selling personal data and mapping your social connections for profit “is both creepy and unethical.” “Under the guise of offering a ‘free’ service, users pay a high price in intrusive advertising and lack of privacy.”
Based in Vermont, Ello was launched by a group of artists and programmers led by Paul Budnitz, whose previous experience includes designing bicycles and toys.