There is no cost for using CloseBys to build an LBS social network, and developers can use their extremely localised networks to make money.

In the CloseBys business plan, advertisers within the locality covered by the network pay a fixed fee to include coupon promotions in the app, followed by a variable fee based on the results. CloseBys uses the fixed advertising fee to host and support the networks. Owners of the networks receive the per-clip and per-use fees paid by the advertisers.

The more promotions that are clipped and used from the network, the more the network owners get paid. Advertisers can limit the size of promotions to run at any location. 

Each do-it-yourself social network focuses on a geographic region spanning roughly 20 miles. Only people within one of these limited areas can create a network for it, and only local people can join.

CloseBys founder and CTO Raj Narayanasamy commented: "Connecting local businesses to local people in a more efficient way was our goal from the beginning. We are opening CloseBys with two small contests for bloggers and Word Press plugin developers."

The networks use anonymous location detection to protect user privacy. Since location is the only criterion for CloseBys.com deals, behavioural advertising and segregation of ads are not possible.