Capazoo

» see capazoo.com as it lived, on the wayback machine

~ the obit ~

Twenty-five million dollars in, fewer than ten thousand users out. That ratio is the whole of Capazoo, and everything else is detail about how the gap got that wide.

It launched in Montreal in November 2006, built by two brothers, Michel and Luc Verville, and from the outside it looked like every social network of that year. You added friends and posted photos, music or writing, in English or French. What it had that the others did not was a currency. Members could hand each other Zoops for anything they put up, each Zoop worth one American cent, and subscribers received a debit card so the accumulated Zoops could come out as actual money.

Nobody outside Quebec had a reason to be there and I was not among the people who found it. In 2006 the social network question in Turkey had one answer and the answer was Hi5, with Facebook arriving not long behind it. Capazoo was aimed at people who wanted to be paid rather than at people who wanted to be wherever their friends already were, and those turned out to be different populations.

~ the rap sheet ~

~ the money ~

The valuations are the part that reads as fiction. The first round was eight million dollars at a seventy-two million pre-money valuation. The second was somewhere between five and ten million at a hundred and thirty-two million pre-money. Total raised passed twenty-five million. National Lampoon came in as an investor in 2007, itself a company having a strange decade.

Headcount reached 130. Members paid a subscription fee before they could start earning referral payments, a structure people call a pyramid scheme when they are being polite about it. Insiders later described the founders taking ten percent commissions on every dollar raised, with roughly two million dollars leaving the company with the two brothers before the user count ever reached five figures.

~ what really happened ~

Capazoo relaunched in October 2007 and four months later the co-founders were suing each other. The stated cause was corruption inside the company. Two brothers fighting in court for control of a business, with embezzlement allegations on the record and a figure of about two million dollars attached to them, is not a condition anyone recovers from while also trying to grow a social network.

The end itself was administrative. On 13 March 2008 at nine in the morning the executives laid off the entire staff, because the legal situation could not be resolved. Sixty people on the development team went in a single pass and one sysadmin stayed behind to keep the site answering. There was a for-rent sign on the head office by the time the press arrived, and the company went bankrupt.

~ what survived ~

Paying people for what they post was not a stupid idea and it did not die here. It came back as tipping on Twitch, as the YouTube partner program, as every creator fund announced since. The difference is that all of those attached money to an audience that already existed. Capazoo tried to buy the audience with the money, and an economy where the only thing anyone is buying is the currency itself has nowhere to get value from.

capazoo.com resolves in 2026 and forwards to an Italian sports betting tips page, a fate the address earned by simply being available. What survives with the name still on it is the logo: a red script wordmark over a blue swoosh, a jester's cap tilted across the C, BETA set in gray beside it and a trademark symbol in the corner. Somebody paid for that beta label and then never got past it.

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