Geosocial startup Foursquare was an immediate hit when it debuted at South by Southwest in 2009. Fast forward four years, and "for many users, the novelty of telling friends they've 'checked in' to a store or restaurant, earning real discounts and virtual badges, has worn off," says Sarah Fried in Bloomberg Businessweek.

In November, the Wall Street Journal said the company "claims more than 25 million registered users, but only about 8 million of them use the app at least once a month."

As a result, Foursquare reportedly raked in just $2 million in revenue last year. "To put these numbers in context," says Tero Kuttinen at, "Supercell, the current top mobile app vendor in the world, grosses $2 million in 48 hours. This means that just two simulation games, Clash of Clans and Hay Day, generate as much revenue over two days as Foursquare does in 365."

Still, Foursquare just raised $41 million in debt from private equity firm Silver Lake.

But "debt offerings are unusual for startups," said Spencer Ante in The Wall Street Journal. Valuing technology startups has become more difficult since Facebook's troublesome public offering, and Foursquare has "had a hard time convincing investors that it was worth at least $760 million," the valuation that one venture capital firm assigned the company last year.

"By raising debt instead of equity," Ante said, "Foursquare avoids the challenge of getting investors to place a value on the company, as well as avoiding the dilution of its management team's equity stakes."

The news of Foursquare's latest financing round comes on the heels of Foursquare's new software update, which is beginning to shift the app's focus from a check-in service to a search tool.

"This has been a long time coming," said Mike Isaac at All Things D. "Foursquare CEO Dennis Crowley has said in the past that the search function should have been on the front door of the app from early on, calling it the company's biggest mistake, in retrospect."

The stronger emphasis on search will "be better news for Foursquare's paid products, as well," giving merchants and advertisers more prominent placement. "An important thing, considering that Foursquare is feeling the pressure to monetize," Isaac said.