Ello is a new social networking website that was created last month and until now it has managed to get $5.5 million as investment. Moreover, the company's executives have decided that the website will never have ads so that they can provide its users an excellent experience.
To make sure that Ello remains ad free the investors and founders have signed a charter according to which the user data can't be sold to a third party. The initial investment was $450,000 and now it has increased 10 times.
Many critics say that Ello will have to sell out sue to its ad-free policy. They say that a social networking website can't grow if it is not publishing ads.
These are the words of Ello's CEO Paul Budnitz:
"We’re really creating a way to enshrine Ello, legally, as what we intend it to be.The bottom line is we’re not going to sell out and no one can make us sell out."
On 20th October the people who signed the agreement explained:
"Ello’s explosive growth over the last few months proves that there is a hunger to connect with friends and see beautiful things — without being manipulated by ad salesmen, boosted posts and computer algorithms that don’t always have our best interests at heart. On an ad-driven social network, the advertiser is the customer and you’re the product that’s bought and sold."They further elaborated:
"To assure in the strongest possible way that Ello stays focused on its mission to be a different kind of social network, Ello has converted to a State of Delaware Public Benefit Corporation. Ello is legally obligated to take its impact on society into account in every decision in makes."
In short the agreement ensures that there will never be any ads on Ello and that it can never sell users' data. That is something that people like. People don't want to be manipulated by the ads and they also don't want to be tracked. It will be a big deal if Ello manages to remain ad free in the future.
The CEO said:
"We really cannot be forced by our investors to break the basic principles."You may also like: 3 Steps To Block Stupid Facebook Game Requests [Infographic]
The main investors of Ello are the Foundry Group, Techstars' Bullet Time Ventures and FreshTracks Capital.
The Foundry Group said:
"Foundry Group is completely supportive of the Ello mission. We’ll either build a business that doesn’t rely on third party advertising or the selling of user data or we won’t build a business. Our belief is that there are products and features that Ello can develop that users will be willing to pay for. While the price points may be low, as part of a much larger ecosystem with millions of users, will provide an economic model for the company which supports the business and our investment."
Techstars also said a few words about the investment in Ello:
"Signing the Ello charter was a no-brainer for us as investors. We believe in the mission, and the (B corp status) further enforces the manifesto and Ello's vision to never market their users to third parties."
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Ello seems to be very threatening for Facebook as it has already acquired 1 million members. Moreover, the users like its policy of an ad free environment. Facebook needs to work on its policy to compete with Ello. It is yet to see that whether Ello can take Facebook's place or not.