1. Jeremiah Owyang

   Posted November 17, 2009 at 2:52 pm | Permalink

   Interesting Sam.

   Thanks for sharing. Does it have anything to do with the nature of your community content “sex-positive”? I’m going to guess that could have factored into a conservative company’s underwriting process.

   I used to work a lender, and know they tend to shy away from certain industries, and without it being live, they may not have context.

   I’m going to chalk this up as State Farm not really doing anything wrong, and I don’t think this is them not getting “social software” but likely a factor due to the nature of the site.

   BTW: I’m indifferent to the topics of a sex positive network, I’m just trying to see it from their point of view.

   
   
2. sam

   Posted November 17, 2009 at 3:03 pm | Permalink

   No doubt insurance companies are conservative, Jeremiah. But not having context or accurate information and canceling a client isn’t very social. No?

   I’d imagine they wouldn’t have a problem with social sites that unite people of all orientations to date or connect. Basing their rejection letter on this is essentially saying they don’t support open-mindedness, which of all things is very ‘neighborly.’

   A lack of understanding is one thing. Treating your customers like this is another. Social means communicating. No?

   
   
3. Eric

   Posted November 17, 2009 at 3:32 pm | Permalink

   This letter looks like it was hand-typed (with typo “ourunderwriting”). If a person is using a typewriter to communicate is it likely that they would not be “open” to technology in general?

   Maybe you can find someone more in touch with tech world.

   
   
4. Christine Lu

   Posted November 17, 2009 at 3:41 pm | Permalink

   Why didn’t they just say so if so?

   Meaning their explanation is kind of a default corporate reason that doesn’t make much sense.

   To say that they don’t write businesses that develop social software that connects people is lame. I mean, as opposed to social software that doesn’t connect people? Eh?

   
   
5. Michael Buckbee

   Posted November 17, 2009 at 5:59 pm | Permalink

   To sort out who to underwrite, insurance companies put different companies into different buckets. For what it’s worth, I think you got put into the “online dating” bucket which is somewhat notorious for problems, high turnover, high failure rate, etc.

   I’ve seen multiple banks and credit processing companies that will not take the business of companies in the “online dating” space because of the all the problems, looks like insurance companies should be added to that list.

   
   
6. Stowe Boyd

   Posted November 18, 2009 at 4:53 am | Permalink

   I think others have said what I feel: online dating, esp. with a sex angle, are iffy. Insurance doesn’t like iffy.

   
   
7. @StateFarm

   Posted November 19, 2009 at 9:56 am | Permalink

   Sam, I apologize for any lack of clarity in the underwriting letter. To clear up any confusion, it’s definitely not the sex-positive nature of your site that led to the decision not to offer business insurance.

   As Craig wrote, we simply don’t take on the liability risk associated with operations of your size and scope (i.e. social networking sites that reach such a large audience and consumer base.) It’s not that we dislike social networking or don’t want to connect people – we work hard to engage on Twitter and other media – but from a business perspective, the liability risk is just too great for us to take on. We don’t insure companies like Facebook or Twitter, either.

   I’m sorry for the inconvenience, and I wish you and Blackbox Republic good luck. Feel free to contact me at @StateFarm on Twitter.

   
   
8. Matthew

   Posted November 19, 2009 at 10:13 am | Permalink

   It’s unfortunate that insurance is not in the business of helping anyone other than themselves.

   
   
9. Jeremiah Owyang

   Posted November 21, 2009 at 5:25 am | Permalink

   It’s interesting, and refreshing to see @allstate respond, given their justification into the conversation. The only thing to make it better? Use a trusted first/last name not just the corporate handle. Having worked with a few financial services firms on social strategy, I can understand why a corporate handle only.

   
   
10. Jeremiah Owyang

    Posted November 21, 2009 at 5:26 am | Permalink

    I meant @statefarm, not @allstate.

    
    
11. Name Chris Nordyke

    Posted November 21, 2009 at 9:28 am | Permalink

    I’m a State Farm agent, and social media adopter/enthusiast. As a State Farm agent, I’d obviously love it if State Farm was open to writing any and all companies, unfortunately it doesn’t make sense for all involved.

    If I had to guess,(and I’m not speaking on behalf of the company) the big concern here is personal injury liability, or the opportunity for slander, libel and defamation of character. You may not think that’s a concern, but it’s a very real reality on social networks, and you as the webmaster are facilitating all of it.

    I agree that it would be great if the State Farm PR officer would comment with a first and last name, but frankly I think its pretty cool that he/she was “listening” and responding at all. A lot of corporations are actively broadcasting on facebook and twitter, but not as many actually listening and engaging.

    Good job @StateFarm. Keep your ear to the ground. Cheers, Chris Nordyke, Agent.

    
    
12. Traian

    Posted November 25, 2009 at 10:04 pm | Permalink

    @sam: is there any email I could contact you directly, for a private matter? or you can follow back twitter.com/roigeek and I’ll send you a message. thanks

    
    
13. Ben Tremblay

    Posted January 1, 2010 at 2:44 pm | Permalink

    Not that this addresses the main point, but … how behind the curve is State farm _really_ … look at the last bit of the second paragraph. The “does not meet” bit … see something curious? “… ourunderwriting guidelines”.

    That’s the sort of typo that happens on a typewriter. Could it possibly be?
    Just imagine someone sitting there, November 9, 2009, banging away at some venerable Selectric.

    
    
14. Steve Golab

    Posted April 13, 2010 at 12:19 pm | Permalink

    Sam, call me. I have a ballsy idea and would love your input. Is Austin in your time horizon?

    
    

One Trackback

1. By Blackbox Republic: “Velvet rope” socialnet targets niche social dating « digiphile on December 8, 2009 at 11:15 am

   [...] at least where traditional business are concerned: as Lawrence shared on his blog, State Farm chose not to underwrite “social software that helps people meet online.” Lawrence says that an iPhone app is in [...]