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Insight: On Facebook, app makers face a treacherous path

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Last spring, the future for Viddy, a video-sharing Facebook app, seemed as sunny as southern California's skies. Based a block away from Venice Beach, the 30-person startup impressed prospective investors with skyrocketing user growth figures and won funding from them at a $370 million valuation. The tech press hailed it as the "Instagram for video," potentially ripe for a billion-dollar-plus buyout. Justin Bieber wanted to invest — and the pop star eventually did just that.

 

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