Unvarnished Has More Money and a New Name: Honestly

Unvarnished, a startup that launched earlier this year as a way of allowing users to provide anonymous feedback on co-workers and colleagues, has closed a new round of financing and come out of invite-only beta mode with a new name. The service is now called Honestly, with the tagline “Truth in reputation.” Founder and CEO Peter Kazanjy says the re-branding was designed to be a better fit with what the company is trying to do, which is to provide an anonymous but authoritative alternative to the kind of relentlessly positive reviews people tend to provide through other services such as LinkedIn. This kind of crowd-sourced reputation data is becoming a more important part of the virtual workforce market.

The company, which raised a $500,000 angel round in April, said it has just closed a $1.2-million seed financing from a number of leading VCs and angel investors, including First Round Capital, Charles River Ventures and Ron Conway’s SV Angel group, as well as Delicious (s yhoo) founder Joshua Schachter, Red Swoosh founder Travis Kalanick, and AngelPad founding partner Richard Chen. Honestly’s CEO says the company will use the funding to expand its engineering team and add features to the service as it moves into open beta. Until now, users had to be invited by someone via their Facebook account.

Kazanjy says Honestly is going to continue using Facebook Connect as the front door to the service, because that provides a crucial element of identity to what is essentially an anonymous rating service (although Kazanjy says he prefers the term “protected identity”). Although other users don’t know who’s rating their performance — unless a user chooses to reveal their real name, which many do — using Facebook Connect ensures that there is a real person behind the reviews. The service also uses a number of algorithms to determine whether a user is behaving properly or not, and “we have incentives for good behavior and disincentives for bad behavior,” Kazanzy says.

Although there was some fear when Unvarnished launched that it would become a cesspool of anonymous name-calling and personal attacks, according to Kazanjy, six months of beta testing has shown that not to be the case, perhaps in part because the service was invite-only. “I think a lot of people expected it would look like the comment section at the SFGate or TechCrunch,” the CEO said. “But for the most part we have seen fairly high-quality content, and we haven’t seen much abuse at all.” About 60 percent of the ratings provided by users so far are 5 stars, Kazanjy said.

The Honestly founder says he chose to grow the network slowly, as other reputation-based sites such as Quora have, because “we wanted to ensure that we built the community properly, to set the mores and norms of the site — it’s a lot easier than trying to change them later.” And Kazanjy says that in six months of testing it has become very popular with both the real estate industry and the venture capital business, likely because in both, “people are looking for information about someone they want to do business with, but someone they don’t already have a relationship with.”

There are other reputation-based services such as iKarma and Klout, as well as newer attempts to build virtual reputation networks, such as Namesake. LinkedIn is also obviously aimed at a similar market, but Kazanjy says that Honestly is trying to carve out a particular niche that provides semi-anonymous commentary that is still of high quality. “We see ourselves as complementary to LinkedIn,” the Honestly founder said. “Their core proposition is that I have 100-percent control over what appears on my profile. We see Honestly as the yin to that yang.” Whether the community the company has built can retain its level of quality as it opens up to more users remains to be seen.

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