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How Will Yo Make Money?

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Or Arbel, the Israeli founder of new Israeli app Yo which when first introduced skyrocketed to the top of downloads for apps, understands that his company is in jeopardy now that the novelty has worn off. He said as much the other day in an interview in London with Business Insider, but failed to offer a clear vision for its future.

Back in June Yo was all the rage, but today it barely registers a blip on the high tech seen. While still popular, the app has dropped out of the top 1, 000 in app stores. Then there is the problem that the company had from its very inception of how exactly to make money off the app no matter how many people may be using it. All it does is send people a poke that says “Yo.”

The company addressed this problem in October when it expanded its services to also allow users in version 1.22 to send their location (@Yo) by double tapping on a friend’s name. In iOS 8 users can Yo back from the lock-screen without opening the app.

At the time Arbel was quoted as saying that the new function, “opens up a whole world of possibilities for both users and service-providers using the Yo API.”

But now the Israeli entrepreneur has changed his tune telling Business Insider that, “If Yo Needs To Exist, It Needs To Make Money.”

Arbel said that part of the problem is that the company has not spent any money on marketing. It currently has only 10 employees. Arbel says that the company is still growing and hiring new people, but if it is to do so it will need investors to provide it with capital and to get those investors Yo will need to show them a business model with projected revenue streams someday.

For all of his contrition, however, Arbel did not provide the people at Business Insider with any information as to how Yo will make money. Will it start to charge fees after an introductory period as WhatsApp does”? If so then why would anyone use it instead of WhatsApp?

Will it add some sort of text advertising with its messages? If so how many people will continue to use it?

So far Yo has raised $1.5 million in startup capital for a valuation of as much as $10 million.

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