BOULDER -Seventy-five percent of U.S. Internet users between the ages of 18 and 24 have a profile on an online social network site - MySpace, perhaps, or Facebook. Among those between 25 and 34, more than half have an online profile.

 

 "At its core, use of online social networks is still a phenomenon of the young," concluded the Pew Internet and American Life Project.

 

Boulder-based eSwarm Inc. sees business opportunity in that phenomenon.

 

"Today's tightly knit generation finds online forums and other social networking technologies archaic and difficult to use," said Matt Etlinger, vice president of eSwarm. Instead of going to one site to talk politics, another to discuss music and a third to chat with former classmates, he explained, they want one place where they can carry on all of those conversations.

 

eSwarm seeks to provide that place. Etlinger claimed that the firm's patent-pending technology will "take what forums and other social networking technologies are already doing and make it better and more organized." He predicted that eSwarm would garner 100,000 users in its first year.

 

The site has been in private beta. Officials said it would launch publicly this summer.

 

Like users of other social networking sites, new eSwarm users register and create profiles. On the beta site, users can browse through topics ranging from actors and agriculture through health and hobbies to sports and toys. The company says users will be able to join or monitor conversations that pique their interest.

 

They can also open new conversations and invite friends and family members to join. Such "viral" expansion of the user base is crucial to eSwarm's growth strategy.

 

eSwarm offers a twist on the microblogging service Twitter, which asks users, "What are you doing?" It asks, "What do you think?"

 

Etlinger said eSwarm is better and more focused than other social networking sites: "It's easier to find topics and enter different conversations. And you can do it all in one place."

 

Users who have joined conversations about music, environmental politics and CU alumni activities, for example, will see updates on all three on their profile pages and can respond from there.

 

According to Etlinger, "The site's technology mimics principles found in nature: fish swarm to avoid predators, birds swarm for food." In these self-organizing systems, "solutions are distributed to the swarm without centralized control."

 

Social networkers are mobile, Etlinger noted. "They need to stay connected to conversations that matter to them even when they're on the go." eSwarm is currently testing a version of the application tuned to mobile devices.

 

eSwarm was incorporated in Wyoming in 2004. Its founders include John Temte, an entrepreneur with experience in the sports, media and services industries. Tim Newcomb, an attorney and author, directs eSwarm research. Etlinger previously held positions in the professional sports industry.

 

According to the patent application the founders filed in 2007, the technology eSwarm is developing is "an interactive system and method for transacting business." The system allows "potential buyers of products or services to collectively bargain with potential sellers." In addition, "potential sellers may bid against one another" to secure purchases from particular buying groups.

 

The revenue model features "offers" rather than "advertisements," Etlinger said, noting that 270 marketers have participated in earlier tests that demonstrated the feasibility of this model. "Unfiltered dialogue presents marketers with opportunities to connect and interact with potential customers," he added.  Sellers would pay for the opportunity to present offers to groups in a bid-based system similar to Google AdWords.

 

Etlinger declined to identify any sellers participating in tests of the revenue model.

 

The company's upcoming launch focuses more on groups as social networks - "friends and likeminded people" - than as buyers. "We need to build the user base," Etlinger said.  "Revenue will happen."

 

As the social networking space matures, some question the "subscribers first and revenues second" approach. According to the 2009 Deloitte Technology, Media and Telecom Predictions, "Social networks need to consider how to transform themselves in 2009. They should articulate and deliver on a clear, credible route to revenues." The report also warns, "As with the dot-com bust earlier this decade, investors may swing from exuberance to pessimism within a few quarters."

 

Etlinger declined to reveal specifics about investments in eSwarm to date, saying only that the amount was "in the millions" and funds came from friends, family and business associates of the founders.

 

Regarding exit strategies, Etlinger said, "We expect to entertain acquisition offers within two years." He suggested that Google Inc. was likely to be interested.