dehood 2 260x390 DeHood iPhone app: you might not live in DeHood, but you should shop thereLaunched this week at TechCrunch Distupt, Palo Alto based DeHood is a free iPhone app and website that tries to do too much, but that has a few sparkling features that if brought to the forefront could make them an interesting player in social location services.

According to CEO Babak Hedayati, who we spoke to at length at Disrupt, DeHood wants to help members of a physical community to communicate better and to have the power to curate the information that is important to their neighborhoods. This is a crowded and very costly market to try to get into. It’s crowded with large, established services such as CitySearch, Yelp and Yahoo, and requires a lot of funding to be able to scale beyond a few target neighborhoods or cities.

Frankly, nothing that we saw in DeHood makes us think that they can win this market – the only chance a startup has to win here is absolutely transformative and viral technology to connect physical communities, and we didn’ t see that with this app. We’re not trying to knock DeHood on this too much, it’s just that this market (i.e. local) is a super-hard nut to crack. In our opinion, DeHood should seriously consider changing their focus to what we consider their strong suit – social shopping.

dehood 1 260x390 DeHood iPhone app: you might not live in DeHood, but you should shop there

Those sparkling features that we mentioned above are all around what DeHood does with social, location-based shopping. As we mentioned in our recent post on “mallcaching”, DeHood gets it right by providing features for users to share deals that they find. In fact, DeHood goes a step beyond what we suggested, and actually aggregates deals from hundreds of nationwide chains and then pushes them out to users by showing them deals at chainstores nearest them.

In both cases, deals are verified by other users in a crowdsourced way, and those verified deals then show up in the stream of people in that area. Although a few of the tasks that were demoed, need to be streamlined a bit (such as the need to add titles, tags and description to a photo of deal a user wants to post), the overall the social shopping experience (and yes, all of DeHood is connected into Twitter and Facebook) is pretty compelling.