When software engineer Jonathan Abrams arrived in Silicon Valley in 1996, the internet was known for three things: vast amounts of information, pornography, and anonymity. If users weren't investigating the first two, they were exploiting the third to argue about movies or politics, their unfiltered opinions unencumbered by concerns over embarrassment. People were known only by their screen handles.

Abrams, who came to California to program for the web browser Netscape, had an idea. What if people could use their real names, faces, and locations online? Instead of having an avatar, they'd simply upload their existing personality in the form of photos, profiles, and interests. They could socialize with others in a transparent fashion, mingling within their existing circles to find new friends or even dates. Strangers would be introduced through a mutual contact. If executed properly, the network would have real-world implications on relationships, something the internet rarely facilitated at that time.

Abrams called his concept Friendster. Launched in March 2003, it quickly grew to host millions of users. Google began talks of a lucrative buyout. Abrams showed up on Jimmy Kimmel Live, anticipating the dot-com-engineer-as-rock-star template. His investors believed Friendster could generate billions.

Instead, Friendster's momentum stalled. Myspace became the dominant social platform, with Facebook quickly gaining ground. Abrams, who once appeared poised to collect a fortune from his creation, watched as copycat sites poached his user base and his influence waned. What should've been a case study of internet success became one of the highest profile casualties of the web's unrestricted growth. It became too big not to fail.

 

Many businesses rely on a creation myth, the idea that a single inciting incident provides the spark of inspiration that turns a company from a small concern into a revenue-generating powerhouse. For publicity purposes, these stories are just that—fictions devised to excite the press and charm consumers. Pierre Omidyar, who programmed AuctionWeb and later renamed it eBay, was said to have conceived of the project to help his wife, Pamela, find Pez dispensers for her collection. In fact, there were no Pez dispensers. It was a fable concocted by an eBay marketing employee who wanted to romanticize the site's origins.

In early press coverage of Friendster, there was little mention of Abrams looking to monetize the burgeoning opportunities available online. Instead, he was portrayed as a single man with a recently broken heart who wanted to make dating easier. Abrams later said there was no truth to this origin story, though he did derive inspiration from Match.com, a successful dating site launched in 1995. Abrams's idea was to develop something like Match.com, only with the ability to meet people through friends. Instead of messaging someone out of the blue, you could connect via a social referral.

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Following stints at Netscape and an aggregation site called HotLinks, Abrams wrote and developed Friendster for a spring 2003 launch. He sent invites to 20 friends and family members in the hopes interest would multiply. It did, and quickly. By June, Friendster had 835,000 users. By fall, there were 3 million. Facebook's launch in February 2004 was months away, and so low-key that Abrams met with Mark Zuckerberg to see if he'd consider selling. If an internet user wanted to socialize in a transparent manner, Friendster was the go-to destination.

When users signed up for the site, they were only allowed to message people who were within six degrees of separation or less. To help endorse unfamiliar faces, Friendster also permitted users to leave "testimonials" on profiles that could extol a person's virtues and possibly persuade a connection to meet up in the real world.

Naturally, not all mutual connections were necessarily good friends: They might have been acquaintances at best, and the resulting casual atmosphere was more of a precursor to Tinder than Facebook. One user told New York Magazine that Friendster was less a singles mixer and more "six degrees of how I got Chlamydia."

Still, it worked. The site's immediate success did not go unnoticed by venture capitalists, who had been circling popular platforms—America Online, Yahoo!, and, later, YouTube—and injecting start-ups with millions in operating funds. At the time, the promise of savvy business minds flipping URLs for hundreds of millions or even billions was a tangible concept, and one that Abrams kept in mind as he fielded an offer from Google in 2003 to buy Friendster for $30 million. It would be a windfall.

Abrams declined.

 

Investors—including future PayPal co-founder Peter Thiel and Google investor K. Ram Shriram—advised Abrams that there was too much money to leave on the table in return for short-term gain. Abrams opted to accept $13 million toward building out the site. He sat on the board of directors and watched as backers began to strategize the best path forward.

Quickly, Abrams noticed a paradigm shift taking place. As a programmer, Abrams solved problems, and Friendster was facing a big one. Buoyed by press attention (including the Kimmel appearance where Abrams handed out condoms to audience members, presumably in anticipation of all the relationships Friendster could help facilitate), the site was slowing down, unable to absorb all of the incoming traffic. Servers struggled to generate customized networks for each user, all of which were dependent on who they were already connected to. A page sometimes took 40 seconds to load.

The investors considered lag time a mundane concern. Adding new features was even less attractive, as that might slow the pages down further. They wanted to focus on partnerships and on positioning Friendster as a behemoth that could attract a nine- or 10-figure purchase price. This is what venture capitalists did, scooping up 10 or 20 opportunities and hoping a handful might explode into something enormous.

But for business owners and entrepreneurs like Abrams, they didn’t have a portfolio to deal with. They were concerned only with their creation. Its failure was all-encompassing; there weren't 19 other venues to turn to if things didn't work out.

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Abrams saw the need for a site reconfiguration. The board was indifferent. Eventually he was removed and assigned a role as chairman, an empty title that was taken away from him in 2005. As the board squabbled over macro issues, Abrams watched as micro issues—specifically, the site itself—deteriorated. Frustrated with wait times, users began migrating to Myspace, which offered more customizable features and let voyeurs browse profiles without "friending" others. Myspace attracted 22.1 million unique users monthly in 2005. Friendster was getting just 1.1 million.

 

By 2006, Friendster was mired in software kinks and something less tangible: a loss of cachet among users who were gravitating toward other social platforms. Though Abrams was out, investors continued to pour money into Friendster in the hopes that they could recoup costs. In 2009, they sold to MOL Global for $40 million, which would later convert the site into a social gaming destination. But it was too late. Though the site still had an immense number of users—115 million, with 75 million coming from Asia—they were passive, barely interacting with other users. By 2011, user data—photos, profiles, messages—was being purged.

In ignoring the quality of the end-user experience, the decision-makers at Friendster had effectively buried the promise of Abrams's concept. They sold off his patents to Facebook in 2010 for $40 million. Coupled with the MOL sale, it may have been a tidy sum, but one that paled in comparison to Friendster's potential. A 2006 article in The New York Times reported with some degree of morbid fascination that if Abrams had accepted the Google offer of $30 million in 2003 in the form of stock, it would've quickly been worth $1 billion.

In the years since, Abrams has tinkered with other sites—including an evite platform called Socialzr and a news monitoring app called Nuzzel, which is still in operation—and tends to Founders Den, a club and work space in San Francisco. He's normally reticent to discuss Friendster, believing there's little point in dwelling on a missed opportunity.

The site did, ultimately, became a case study for Harvard Business School—though perhaps not in the way investors had intended. Friendster was taught as a cautionary tale, an example that not every good idea will find its way to success.