First of all thank you for developing this brilliant app and being as responsive as you have been, this looks to be the start of something huge. I installed the app and have been using it and I see lots of potential in it.
You've been very cool about accepting advice/critiques and very responsive to bugs, etc., so I figured I'd make a couple of suggestions of my own for your consideration
A standalone buddy list (like AIM, Yahoo! and MSN) with features unique to Android, and functions that could be integrated with other apps in a way that the other IM services aren't. For example, maybe you can have the IM portion run separately until you summon the location portion of the app (with the search button perhaps?). Or maybe just provide us with the option to configure the app to run it either way, the way its set up now or as a standalone IM client (I think having the flexibility to do both will make this app definitely stand out).
The ability to send files (vids, ringtones, etc.) to someone.
Also, maybe there can be more privacy controls. The option of sharing your location with people on your list, people in your town, region, etc., or going invisible would be welcomed additions, and I say this because there are a great number of people who would enjoy an app but who are concerned about their privacy/security as someone previously posted.
Buddy list options so that you can send messages to specific groups of people (friends, family, coworkers, etc.), that would work great with the invites feature imho
Also, a widget would be pretty hot!
It's been mentioned before, this can be Androids response to bbm, I for one think it has the potential to be far greater!
those are just some ideas I had, hope they help!