With a New App, Bump Gets a Bump

It ‘s been a busy two weeks for Mountain View, Calif.-based Bump Technologies, the company behind an app called Bump that allows you to exchange information between smartphones (for now iPhone and Android devices only). It recently released a shinier and faster version of the Bump application for the iPhone. As a result, the company has seen almost 150 percent growth in the number of people who bump as well as how often they bump their devices. The number of objects shared — photos, contact information and calendar information — is on an upswing.

A lot of this increase has to do with the new app, which is about five times faster than the previous version. Just as on the web, the speed of an app is directly correlated to usage. “For the last six months all we have done is overhaul the infrastructure and upgraded and added new features to the application,” CEO David Lieb told me this morning.  “Over the past few months, Android has been growing at a rapid clip,” said Lieb, even though the iPhone version of their app is still a dominant part of their customer base.

The company’s three co-founders — David , Jake and Andy Huibers — are all former engineers from Texas Instruments (s txn). They’re a motley crew; David is 30, Andy is 40, and Jake is the baby of the group at 27. Back in 2008, frustrated by the archaic way folks exchanged information like business cards, they built an app to automate the process. All you have to do is to imitate the ridiculous act of bumping your knuckles with another person while holding your phone with the Bump app open. Three former chip guys quit their jobs and joined Y Combinator. Their technology drew interest from the likes of veteran investors like Ron Conway and Ram Shriram, super angel Aydin Senket, and Sequoia Capital. They together invested $3 million in the company back in Oct. 2009.

Back in the hey-day of personal digital assistants, you could beam business cards to each other. PayPal’s (s ebay) original idea was to beam money from one Palm Pilot (s hpq) device to another. Ironically, a decade later, PayPal just announced a way to bump your smartphones and exchange money. PayPal is one of the first companies to use the brand new Bump API for Android. (The Bump API is being used by around 200 iPhone apps at the moment.)

Bump, which launched in March 2009, has so far has been downloaded 15 million times. The three founders projected a million downloads at best in the first year. Much of that growth has been organic — no plugs from Apple in their commercials — and very viral. When analyzing the usage data of its customers, the company realized that nearly two-thirds of its customers were going from download to sharing within 15 minutes. “To us, it said that people were making their friends download the app and share information with them,” Lieb said.

That little discovery became the driving force for the company; they’re now ruthlessly trying to reduce the time it takes to download and start using the application. It’s driving the company’s entire design process and user experience, and in doing so, the company has seen its usage explode, especially on the weekends. “We see a sharp increase in usage and growth over the weekends,” said Lieb. That trend follows the enhanced social interactions — swapping contacts and exchanging photos —  that take place over the weekend.

The way Bump works is that the application uses different sensors such as the accelerometers inside the phones and elements like location (determined through cell-tower-based triangulation) and time and sends those inputs to a central server via a mobile Internet connection. From there, it builds a match for device nearest to your phone. For now, the app has an accuracy rate in the high nineties. Over time, they want to improve the accuracy and start using other sensors inside the device. (To me, Bump is near-field communications without the need of a chip.)

Mintz explained that what Bump wants to do eventually is bridge the gap that exists between physical and digital worlds. Bump’s technology, he hopes, can be embedded in many different devices (and applications) for fostering interactions amongst things and people.

That said, the company has some major challenges. As a long time user of Bump, though, I like swapping cards via Bump, but the application itself doesn’t have the “engagement factor” which would make me use this application every day. I like swapping cards via Bump, but don’t currently use it in other ways.

A vastly improved interface is great, and so is the ability to arrange calendar appointments, exchange social networking information, and photos. In addition, swapping cards has helped boost the application’s usage, but that’s not going to take up my mobile attention like Foursquare or Facebook. This issue of engagement is the biggest challenge the company needs to solve before it can actually realize its true potential. Otherwise, it might end up becoming a back-end service for others’ apps, not that there’s anything wrong with that.

Updated: Looks like Apple featured them in a commercial and they got a lot of press for being the billionth app downloaded from the App Store. Sorry about the error.