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Small Business

Is SXSW Social Media Show Still Magic for Start-Ups?

Is SXSW Social Media Show Still Magic for Start-Ups?
March 10, 2013 9:52AM

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The 20-year-old South By Southwest Interactive show small-scale version of the CES international electronics show in Las Vegas. Despite SXSW's reputation and growing attendance, the question needs to be begged: Is the interactive portion of the show still an effective showcase? Or are entrepreneurs approaching it differently?

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The edgy social-media show that launched two of its biggest start-ups the past decade no longer seems as cool or as much of a launching pad.

Since Twitter took the show by storm in 2007, and Foursquare did the same in 2009, there hasn't been a breakout product or service of the same magnitude at the South By Southwest Interactive (SXSWi) show, which [began Friday].

SXSW is a small-scale Relevant Products/Services version of the CES international electronics show in Las Vegas -- a more-intimate, less-gadget-focused networking event in Austin, distinguished by early-stage companies, late-night music and mountains of barbecue.

The 20-year-old show is probably best known for playing a seminal role in Twitter's emergence as a household name. The microblogging service, which recently passed 200 million members, continues to participate at SXSW to connect with potential business partners, customers and the media, says Joel Lunenfeld, Twitter's vice president of global brand strategy.

"It's been an evolution from our discovery as an innovative product to a place where the conversation about SXSW takes place (via Twitter)," Lunenfeld says. "Last year, we emerged as a strong place for brands and advertisers," such as American Express.

Twitter gained even more fans by sponsoring with American Express the highlight of last year's show -- a Jay-Z concert -- to launch a Twitter-AmEx partnership. SXSW is "always going to be a launching pad," Foursquare CEO Dennis Crowley says. "What better place to test your app in front of thousands of early-adopter beta testers?"

And yet ...

Despite SXSW's reputation and growing attendance -- a record 26,500 people are expected to descend on Austin this weekend for the interactive segment of the 10-day event -- the question needs to be begged: Is the interactive portion of the show still an effective showcase? Or are entrepreneurs approaching it differently?

Gone are the days when a Twitter or Foursquare could rise above the noise, says Jared Hecht, co-founder of GroupMe, a group-messaging service attending for the third time. "I'm not sure winners even emerge for a day," he says. "The best strategy may be to launch before SXSW, make a name for yourself, and then build off it at SXSW."

With a modest budget, GroupMe garnered attention last year with creative marketing. It gave away grilled-cheese sandwiches and beer -- then had speed-eating champion Takeru Kobayashi wolf down grilled-cheese sandwiches for a world record.

"It's harder to make an impact, yes," says Hugh Forrest, director of SXSW Interactive. "There are a heck of a lot more companies, and apps Relevant Products/Services, than five and 10 years ago." (continued...)

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© 2013 USA TODAY under contract with MarketWatch. All rights reserved.

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