Founder of Color Still Has Faith, Partners With Verizon on Android

Bill Nguyen, the founder of the photo- and video-sharing application Color, acknowledges his company has so far been better at grabbing the attention of venture capitalists than actual users.

After accepting $41 million from investors for an application that failed to gain popularity, Color Labs Inc. has been held up as an example of Silicon Valley excess and a looming tech bubble. Just saying the company’s name can get a laugh.

“It sucks and it hurts my feelings, but it hasn’t stopped me from taking risks,” said Nguyen, who sold online music service Lala.com to Apple Inc. in 2009. “I have this faith that we’re going to get there, that we’re going to pull it out.”

Nguyen said many have been asking what he’s doing with all that money. Now, after months of not releasing a new product, Color today announced a partnership with Verizon Wireless to have its application pre-installed on many Android smartphones running on the carrier’s next-generation LTE wireless network.

The application allows people to broadcast 30 seconds of video from their phones that others can watch live. When sharing a video live, a user can send an alert to friends through Facebook or a text message, Nguyen said.

Color is among several companies with products for sharing video. Viddy raised money last month from investors including Twitter co-founder Biz Stone.

The company, which has about 50 employees at its offices in downtown Palo Alto, California, has created a new file format so users can both stream the videos live and then store them on Color’s network to view or share later, according to Nguyen.

For Verizon, the arrangement provides a way to promote its new 4G wireless network and offer a feature that differentiates its phones from those running on rival carriers such as AT&T Inc. Sharing video with audio via Color is only possible on the faster network, Nguyen said.

Adding Color also is an example of how phone manufacturers and wireless carriers are trying to add features to stand out in the crowded smartphone market. Samsung Electronics Co. announced a partnership with the Web-storage company Dropbox last week, while HTC Corp. last year bought a 51 percent stake in Beats Electronics, the maker of high-end audio gear co-founded by rapper Dr. Dre.

Color is hoping Verizon, which has more than 90 million subscribers, will give them a boost in users. The announcement is the third evolution of Color since its debut in March 2011. The company started as a way to view photos taken by others using the app within the same proximity. The company then shifted to to be a way to share video on Facebook. Neither features were popular for users, with Color having just 30,000 daily active users, according to AppData.com.

Nguyen said Color will be on ‘‘most, if not all” of Verizon’s 4G smartphones, though he declined to discuss the financial details of the deal. One phone that Color won’t be on is Nguyen’s former employer; Apple decides what applications are pre-installed on the iPhone.  Nguyen said he feels conflicted about switching teams to lend support to Google’s Android operating system.

“I have mixed feelings,” said Nguyen, whose main phone is an iPhone. “It’s not easy for me.”

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