USuggest Raises $250K For Social Shopping Site
By Jonathan Shieber of The Venture Capital Analyst

PHOENIX -- With $250,000 in seed financing closed just last week, USuggest LLC is working feverishly to bring to market its social networking technology that pays a user for their suggestions, VentureWire has learned.

The Phoenix-based company, founded by professors from the Arizona State University, has developed patent-pending technology that allows online shoppers to get commissions for the discoveries they make while shopping online.

Investors in the company's seed round of financing included wealthy individuals, according to the company's interim chief executive, Hasan Davulcu. "There are investment bankers among our angels, there is a venture capitalist, and there is an ex-CEO who has done a number of start-ups in Silicon Valley," he said.

Currently operating with a beta-site, USuggest will use its initial funding to, "in the next four months, build the design, build the Web site and begin to prototype this marketing message and go for a larger raise," Davulcu said. The company's goal is to launch its first site in time for the Christmas season.

Using a software tool which the company calls InstantValue, shoppers can highlight any deal on the Web, tag it, and submit it to USuggest. The USuggest site then instantly lists the suggestion and tracks responses from other shoppers.

Deals that users post to the Web site are ranked according to click-through rates and sales conversions, and the highest ranked suggestions earn commission rewards for the individuals who posted the deal.

Davulcu recognizes his company is in a crowded market. Competitors like Kaboodle Inc., which raised $3.55 million in April for its service to help users collect and share Web research, and privately held Squidoo LLC offer tagging and search services.

The difference is the cash, he said. "We make you an instant partner," said Davalcu. "We begin listing your suggestion at our portal and we split the proceeds from any sale we make with the partner 50-50."

Launched in 2005, the company was founded by Davulcu, an assistant professor of ASU's Department of Computer Science and Engineering, Thomas Duening, the Director of ASU's Entrepreneurial Programs Office, in its school of engineering, and Prabhdeep Singh a doctoral student in the computer science and engineering department.

In June, USuggest was granted a licensing agreement with the Arizona State University for its technology.
The company was advised in its licensing agreements by the law firm of Wilson Sonsini Goodrich & Rosati, while its intellectual property adviser is Townsend and Townsend and Crew. http://www.usuggest.com