Can Michael Birch bring Bebo back?

After selling the company he co-founded in 2008 for $850million, Michael Birch bought it back this year for just $1m - but is it too late to save Bebo?

In 2008 Michael Birch sold Bebo, the social networking site he founded with his wife, Xochi, to the digital media giant AOL for $850m. This July he bought it back for just $1m, promising to reinvent the failing brand. Birch says he never imagined he’d own Bebo again, but when the company he started from his San Francisco living room in 2005 seemed certain to fall into obscurity, he felt compelled to step in.

“It seemed like Bebo’s ultimate fate was that someone was going to buy it and use it as an email list or database to get people to join a completely different product,” he says, when we speak on the phone. “We thought we could give it a happier ending.”

Five years ago, Bebo was the third-largest social networking site, behind Facebook and MySpace, with 40 million users. AOL’s chief executive at the time, Randy Falco, described the acquisition as a “game-changer” for his firm. But by the late Noughties, users of social networking sites were defecting to Facebook in huge numbers.

In 2010, AOL offloaded Bebo for $10m to the private-equity firm Criterion Capital Partners, which couldn’t halt the site’s decline. In March 2013, Facebook had 1.11 billion monthly users while, Birch tells me, only a “couple of hundred thousand” sign into Bebo every month.

Birch, who is 43, was born in Hertfordshire and met Xochi while they were both studying at Imperial College London. He says he ended up in San Francisco only “by chance” because Xochi grew up there. Where social media stars such as Facebook’s founder, Mark Zuckerberg, and Twitter’s founder, Jack Dorsey, talk in lofty terms about how their inventions have changed the world, Birch has retained a stereotypically British irreverence. He has posted a spoof product video for Bebo’s relaunch, in which he explains over dramatic background music how Bebo empowered millions to share “potentially career-destroying photos” and how its online doodling feature turned the site into the “single biggest repository of illustrated cock-and-balls ever recorded”.

Birch believes that Bebo’s decline, far from confirming Facebook’s strength, has exposed its fundamental weakness. He learned that “you grow and become very large because of the networking effect, but it can also be your demise because when people start leaving, it tends to be the early adopters and the influencers who go first and they take their friends with them.” He says that Facebook, which floated in 2012, is “overvalued” and can’t maintain its market dominance. Expecting someone to stay on Facebook is like “saying someone is only going to go to one bar for the rest of their life”.

The new Bebo will be a mobile-only app and it won’t compete directly with Facebook. This is partly because Birch believes Facebook’s model is becoming outdated. Having studied his 14-year-old daughter’s online habits, he thinks people will increasingly sign up to several social media apps, and that they will go for more direct, personalised forms of online communication.

Running Bebo will be harder now he’s in his forties, Birch says. He has three children and has lost the “hunger” needed to work 80-hour weeks. As the young tech billionaires who made it big in the Noughties start to approach middle age, they share one common enemy.

“It doesn’t matter how successful or wealthy you are, the people you are most fearful of are the young, up-andcoming people,” he says. “If you ask Google who they are most fearful of, it’s probably the guy in his dorm room, not the big companies of the world.”

While Facebook had over 1.10 billion users in March 2013, Bebo is down to a "couple of hundred thousand". Photograph: AFP/Getty Images.

Sophie McBain is a freelance writer based in Cairo. She was previously an assistant editor at the New Statesman.

This article first appeared in the 17 October 2013 issue of the New Statesman, The Austerity Pope

Photo: Getty
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What happened when a couple accidentally recorded two hours of their life

The cassette tape threw Dan and Fiona into a terrible panic.

If the Transformers series of movies (Transformers; Transformers: Revenge of the Fallen; Transformers: Dark of the Moon; Transformers: Age of Extinction; and Transformers: the Last Knight) teach us anything, it is that you think your life is going along just fine but in a moment, with a single mistake or incident, it can be derailed and you never know from what direction the threat will come. Shia LaBeouf, for example, thinks everything is completely OK in his world – then he discovers his car is a shape-shifting alien.

I once knew a couple called Dan and Fiona who, on an evening in the early 1980s, accidentally recorded two hours of their life. Fiona was an English teacher (in fact we’d met at teacher-training college) and she wished to make a recording of a play that was being broadcast on Radio 4 about an anorexic teenager living on a council estate in Belfast. A lot of the dramas at that time were about anorexic teenagers living on council estates in Belfast, or something very similar – sometimes they had cancer.

Fiona planned to get her class to listen to the play and then they would have a discussion about its themes. In that pre-internet age when there was no iPlayer, the only practical way to hear something after the time it had been transmitted was to record the programme onto a cassette tape.

So Fiona got out their boom box (a portable Sony stereo player), loaded in a C120 tape, switched on the radio part of the machine, tuned it to Radio 4, pushed the record button when the play began, and fastidiously turned the tape over after 60 minutes.

But instead of pushing the button that would have taped the play, she had actually pushed the button that activated the built-in microphone, and the machine captured, not the radio drama, but the sound of 120 minutes of her and Dan’s home life, which consisted solely of: “Want a cup of tea?” “No thanks.” And a muffled fart while she was out of the room. That was all. That was it.

The two of them had, until that moment, thought their life together was perfectly happy, but the tape proved them conclusively wrong. No couple who spent their evenings in such torpidity could possibly be happy. Theirs was clearly a life of grinding tedium.

The evidence of the cassette tape threw Dan and Fiona into a terrible panic: the idea of spending any more of their evenings in such bored silence was intolerable. They feared they might have to split up. Except they didn’t want to.

But what could they do to make their lives more exciting? Should they begin conducting sordid affairs in sleazy nightclubs? Maybe they could take up arcane hobbies such as musketry, baking terrible cakes and entering them in competitions, or building models of Victorian prisons out of balsa wood? Might they become active in some kind of extremist politics?

All that sounded like a tremendous amount of effort. In the end they got themselves a cat and talked about that instead. 

This article first appeared in the 20 July 2017 issue of the New Statesman, The new world disorder