On June 1, 1999, Fanning released a preliminary beta program of Napster and soon, hundreds of college students at Northeastern were trading music.Sean Parker was the co-founder.
In 2002, Fanning was named to the MIT Technology Review TR100 as one of the top 100 innovators in the world under the age of 35. In 2003, he opened a new company, Snocap, along with Jordan Mendelson (Napster's Chief Architect), and Ron Conway. The company aspired to be a legitimate marketplace for digital media. However, their partners and the public did not respond well. Customer support was poor, and technical issues were numerous. One of their primary partners, CD Baby, wrote a scathing account of their relationship. In late 2007, Snocap laid off 60% of its workforce. ValleyWag wrote an article that Fanning had long left Snocap and began to work on another venture, Rupture. The ValleyWag article stated that the failure was largely due to Snocap's CEO Rusty Rueff and that of former VP Engineerng Dave Rowley, who "made a mess of engineering before he was fired". Snocap was looking to sell itself and fast. In 2008, they found a buyer; imeem acquired Snocap in a fire sale.
The Rupture project was announced in 2007 with seed funding, and CrunchBase notes the date Shawn officially became CEO of Rupture was October 2, 2007.
In December 2006, Fanning, along with Co-founder
Jon Baudanza, developed Rupture, a social networking tool designed to handle the task of publishing gamers' individual profiles to a communal space and facilitating communication between World of Warcraft players. Rupture was later acquired by Electronic Arts for $30 million. Fanning's career at Electronic Arts was short-lived as a round of layoffs in November 2009 included him and his team at Rupture.
A few months after Fanning was laid off from Electronic Arts, he started a new company called Path.com. In January 2010, Dave Morin announced he was leaving Facebook, where he was a Senior Platform Manager, to join Fanning and become CEO at Path.
In 2011 Fanning reunited with Napster cofounder Sean Parker to found Airtime.com. Some of the investors are Ron Conway, Michael Arrington, and Ashton Kutcher. Fanning serves as CEO and Parker as executive chairman.
Airtime launched in June 2012 at a disastrous public event where Parker and Fanning paid huge amounts of money to have celebrities present but the product repeatedly crashed and ultimately failed to work. Greg Sandoval of CNET commented, "To launch his new start-up, Sean Parker should have spent less of his billions on celebrity guests and more of it on fixing his technology."