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LinkedIn launches a $25M fund for creators, will test Clubhouse-style audio feature in coming weeks
When LinkedIn first launched Stories format, and later expanded its tools for creators earlier this year, one noticeable detail was that the Microsoft-owned network for professionals hadn’t built any kind of obvious monetization into the program — noticeable, given that creators earn a living on other platforms like Instagram, YouTube and TikTok, and those apps had lured creators, their content and their audiences in part by paying out.
“As we continue to listen to feedback from our members as we consider future opportunities, we’ll also continue to evolve how we create more value for our creators,” is how LinkedIn explained its holding pattern on payouts to me at the time. But that strategy may have backfired for the company — or at least may have played a role in what came next: last month, LinkedIn announced it would be scrapping its Stories format and going back to the proverbial drawing board to work on other short-form video content for the platform.
Now comes the latest iteration in that effort. To bring more creators to the platform, the company today announced that it would be launching a new $25 million creator fund, which initially will be focused around a new Creator Accelerator Program.
It’s coming on the heels of LinkedIn also continuing to work on one of its other new-content experiments: a Clubhouse-style live conversation platform. As we previously reported, LinkedIn began working on this back in March of this year. Now, we are hearing that the feature will make an appearance as part of a broader events strategy for the company very soon.
“We’ll be starting to test audio with a small pilot group in the coming weeks,” said Chris Szeto, senior director of product at LinkedIn, who heads up its audio efforts. “Given the trends in virtual, hybrid events we are also working on making audio part of our overall event strategy rather than a standalone offering, so that we can give people more choice about how they want to run and engage with their audiences.”
Notably, in a blog post announcing the creator fund, LinkedIn also listed a number of creator events coming up. Will the Clubhouse-style feature pop up there? Watch this space. Or maybe… listen up.
In any case, the creator accelerator that LinkedIn is announcing today is part of a bigger effort it’s been making to build out a platform for creating content. That has included building new tools and acquiring companies like Jumprope (a platform devised to make “how-to” videos) earlier this year. Together with the accelerator, the idea that LinkedIn wants to encourage more dynamic and lively set of voices to get more people talking and spending time on LinkedIn.
Andrei Santalo, global head of community at LinkedIn, noted in the blog post that the accelerator/incubator will be focused on the many ways that one can engage on LinkedIn.
“Creating content on LinkedIn is about creating opportunity, for yourselves and others,” he writes. “How can your words, videos and conversations make 774+ million professionals better at what they do or help them see the world in new ways?”
The incubator will last for 10 weeks and will take on 100 creators in the U.S. to coach them on building content for LinkedIn. It will also give them chances to network with like-minded individuals (naturally… it is LinkedIn), as well as a $15,000 grant to do their work. The deadline for applying (which you do here) is October 12.
The idea of starting a fund to incentivize creators to build video for a particular platform is definitely not new — and that is one reason why it was overdue for LinkedIn to think about its own approach.
Leading social media platforms like TikTok, Snapchat, Instagram and Facebook and YouTube all have announced hundreds of millions of dollars in payouts in the form of creator funds to bring more original content to their platforms.
You could argue that for mass-market social media sites, it’s important to pay creators because competition is so fierce among them for consumer attention.
But on the other hand, those platforms have appeal for creators because of the potential audience size. At 774 million users, LinkedIn isn’t exactly small, but the kind of content that tends to live on there is so different, and maybe drier — it’s focused on professional development, work and “serious” topics — that perhaps it might need the most financial incentive of all to get creators to bite.
LinkedIn’s bread and butter up to now has been around professional development: people use it to look for work, to get better jobs, to hire people, and to connect with people who might help them get ahead in their professional lives.
But it’s done so in a very prescribed set of formats that do not leave much room for exploring “authenticity” — not in the modern sense of “authentic self”, and not in the more old-school sense of just letting down your guard and being yourself. (Even relatively newer initiatives like its education focus directly play into this bigger framework.)
With authenticity becoming an increasing priority for people — and maybe more so as we have started to blur the lines between work and home because of COVID-19 and the changes that it has forced on us — I can’t help but wonder whether LinkedIn will use this opportunity to rethink, or at least expand the concept of, what it means to spend time on its platform.
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Today’s real story: The Facebook monopoly
Facebook is a monopoly. Right?
Mark Zuckerberg appeared on national TV today to make a “special announcement.” The timing could not be more curious: Today is the day Lina Khan’s FTC refiled its case to dismantle Facebook’s monopoly.
To the average person, Facebook’s monopoly seems obvious. “After all,” as James E. Boasberg of the U.S. District Court for the District of Columbia put it in his recent decision, “No one who hears the title of the 2010 film ‘The Social Network’ wonders which company it is about.” But obviousness is not an antitrust standard. Monopoly has a clear legal meaning, and thus far Lina Khan’s FTC has failed to meet it. Today’s refiling is much more substantive than the FTC’s first foray. But it’s still lacking some critical arguments. Here are some ideas from the front lines.
To the average person, Facebook’s monopoly seems obvious. But obviousness is not an antitrust standard.
First, the FTC must define the market correctly: personal social networking, which includes messaging. Second, the FTC must establish that Facebook controls over 60% of the market — the correct metric to establish this is revenue.
Though consumer harm is a well-known test of monopoly determination, our courts do not require the FTC to prove that Facebook harms consumers to win the case. As an alternative pleading, though, the government can present a compelling case that Facebook harms consumers by suppressing wages in the creator economy. If the creator economy is real, then the value of ads on Facebook’s services is generated through the fruits of creators’ labor; no one would watch the ads before videos or in between posts if the user-generated content was not there. Facebook has harmed consumers by suppressing creator wages.
A note: This is the first of a series on the Facebook monopoly. I am inspired by Cloudflare’s recent post explaining the impact of Amazon’s monopoly in their industry. Perhaps it was a competitive tactic, but I genuinely believe it more a patriotic duty: guideposts for legislators and regulators on a complex issue. My generation has watched with a combination of sadness and trepidation as legislators who barely use email question the leading technologists of our time about products that have long pervaded our lives in ways we don’t yet understand. I, personally, and my company both stand to gain little from this — but as a participant in the latest generation of social media upstarts, and as an American concerned for the future of our democracy, I feel a duty to try.
The problem
According to the court, the FTC must meet a two-part test: First, the FTC must define the market in which Facebook has monopoly power, established by the D.C. Circuit in Neumann v. Reinforced Earth Co. (1986). This is the market for personal social networking services, which includes messaging.
Second, the FTC must establish that Facebook controls a dominant share of that market, which courts have defined as 60% or above, established by the 3rd U.S. Circuit Court of Appeals in FTC v. AbbVie (2020). The right metric for this market share analysis is unequivocally revenue — daily active users (DAU) x average revenue per user (ARPU). And Facebook controls over 90%.
The answer to the FTC’s problem is hiding in plain sight: Snapchat’s investor presentations:
Snapchat July 2021 investor presentation: Significant DAU and ARPU Opportunity. Image Credits: Snapchat
This is a chart of Facebook’s monopoly — 91% of the personal social networking market. The gray blob looks awfully like a vast oil deposit, successfully drilled by Facebook’s Standard Oil operations. Snapchat and Twitter are the small wildcatters, nearly irrelevant compared to Facebook’s scale. It should not be lost on any market observers that Facebook once tried to acquire both companies.
The market Includes messaging
The FTC initially claimed that Facebook has a monopoly of the “personal social networking services” market. The complaint excluded “mobile messaging” from Facebook’s market “because [messaging apps] (i) lack a ‘shared social space’ for interaction and (ii) do not employ a social graph to facilitate users’ finding and ‘friending’ other users they may know.”
This is incorrect because messaging is inextricable from Facebook’s power. Facebook demonstrated this with its WhatsApp acquisition, promotion of Messenger and prior attempts to buy Snapchat and Twitter. Any personal social networking service can expand its features — and Facebook’s moat is contingent on its control of messaging.
The more time in an ecosystem the more valuable it becomes. Value in social networks is calculated, depending on whom you ask, algorithmically (Metcalfe’s law) or logarithmically (Zipf’s law). Either way, in social networks, 1+1 is much more than 2.
Social networks become valuable based on the ever-increasing number of nodes, upon which companies can build more features. Zuckerberg coined the “social graph” to describe this relationship. The monopolies of Line, Kakao and WeChat in Japan, Korea and China prove this clearly. They began with messaging and expanded outward to become dominant personal social networking behemoths.
In today’s refiling, the FTC explains that Facebook, Instagram and Snapchat are all personal social networking services built on three key features:
- “First, personal social networking services are built on a social graph that maps the connections between users and their friends, family, and other personal connections.”
- “Second, personal social networking services include features that many users regularly employ to interact with personal connections and share their personal experiences in a shared social space, including in a one-to-many ‘broadcast’ format.”
- “Third, personal social networking services include features that allow users to find and connect with other users, to make it easier for each user to build and expand their set of personal connections.”
Unfortunately, this is only partially right. In social media’s treacherous waters, as the FTC has struggled to articulate, feature sets are routinely copied and cross-promoted. How can we forget Instagram’s copying of Snapchat’s stories? Facebook has ruthlessly copied features from the most successful apps on the market from inception. Its launch of a Clubhouse competitor called Live Audio Rooms is only the most recent example. Twitter and Snapchat are absolutely competitors to Facebook.
Messaging must be included to demonstrate Facebook’s breadth and voracious appetite to copy and destroy. WhatsApp and Messenger have over 2 billion and 1.3 billion users respectively. Given the ease of feature copying, a messaging service of WhatsApp’s scale could become a full-scale social network in a matter of months. This is precisely why Facebook acquired the company. Facebook’s breadth in social media services is remarkable. But the FTC needs to understand that messaging is a part of the market. And this acknowledgement would not hurt their case.
The metric: Revenue shows Facebook’s monopoly
Boasberg believes revenue is not an apt metric to calculate personal networking: “The overall revenues earned by PSN services cannot be the right metric for measuring market share here, as those revenues are all earned in a separate market — viz., the market for advertising.” He is confusing business model with market. Not all advertising is cut from the same cloth. In today’s refiling, the FTC correctly identifies “social advertising” as distinct from the “display advertising.”
But it goes off the deep end trying to avoid naming revenue as the distinguishing market share metric. Instead the FTC cites “time spent, daily active users (DAU), and monthly active users (MAU).” In a world where Facebook Blue and Instagram compete only with Snapchat, these metrics might bring Facebook Blue and Instagram combined over the 60% monopoly hurdle. But the FTC does not make a sufficiently convincing market definition argument to justify the choice of these metrics. Facebook should be compared to other personal social networking services such as Discord and Twitter — and their correct inclusion in the market would undermine the FTC’s choice of time spent or DAU/MAU.
Ultimately, cash is king. Revenue is what counts and what the FTC should emphasize. As Snapchat shows above, revenue in the personal social media industry is calculated by ARPU x DAU. The personal social media market is a different market from the entertainment social media market (where Facebook competes with YouTube, TikTok and Pinterest, among others). And this too is a separate market from the display search advertising market (Google). Not all advertising-based consumer technology is built the same. Again, advertising is a business model, not a market.
In the media world, for example, Netflix’s subscription revenue clearly competes in the same market as CBS’ advertising model. News Corp.’s acquisition of Facebook’s early competitor MySpace spoke volumes on the internet’s potential to disrupt and destroy traditional media advertising markets. Snapchat has chosen to pursue advertising, but incipient competitors like Discord are successfully growing using subscriptions. But their market share remains a pittance compared to Facebook.
An alternative pleading: Facebook’s market power suppresses wages in the creator economy
The FTC has correctly argued for the smallest possible market for their monopoly definition. Personal social networking, of which Facebook controls at least 80%, should not (in their strongest argument) include entertainment. This is the narrowest argument to make with the highest chance of success.
But they could choose to make a broader argument in the alternative, one that takes a bigger swing. As Lina Khan famously noted about Amazon in her 2017 note that began the New Brandeis movement, the traditional economic consumer harm test does not adequately address the harms posed by Big Tech. The harms are too abstract. As White House advisor Tim Wu argues in “The Curse of Bigness,” and Judge Boasberg acknowledges in his opinion, antitrust law does not hinge solely upon price effects. Facebook can be broken up without proving the negative impact of price effects.
However, Facebook has hurt consumers. Consumers are the workers whose labor constitutes Facebook’s value, and they’ve been underpaid. If you define personal networking to include entertainment, then YouTube is an instructive example. On both YouTube and Facebook properties, influencers can capture value by charging brands directly. That’s not what we’re talking about here; what matters is the percent of advertising revenue that is paid out to creators.
YouTube’s traditional percentage is 55%. YouTube announced it has paid $30 billion to creators and rights holders over the last three years. Let’s conservatively say that half of the money goes to rights holders; that means creators on average have earned $15 billion, which would mean $5 billion annually, a meaningful slice of YouTube’s $46 billion in revenue over that time. So in other words, YouTube paid creators a third of its revenue (this admittedly ignores YouTube’s non-advertising revenue).
Facebook, by comparison, announced just weeks ago a paltry $1 billion program over a year and change. Sure, creators may make some money from interstitial ads, but Facebook does not announce the percentage of revenue they hand to creators because it would be insulting. Over the equivalent three-year period of YouTube’s declaration, Facebook has generated $210 billion in revenue. one-third of this revenue paid to creators would represent $70 billion, or $23 billion a year.
Why hasn’t Facebook paid creators before? Because it hasn’t needed to do so. Facebook’s social graph is so large that creators must post there anyway — the scale afforded by success on Facebook Blue and Instagram allows creators to monetize through directly selling to brands. Facebooks ads have value because of creators’ labor; if the users did not generate content, the social graph would not exist. Creators deserve more than the scraps they generate on their own. Facebook suppresses creators’ wages because it can. This is what monopolies do.
Facebook’s Standard Oil ethos
Facebook has long been the Standard Oil of social media, using its core monopoly to begin its march upstream and down. Zuckerberg announced in July and renewed his focus today on the metaverse, a market Roblox has pioneered. After achieving a monopoly in personal social media and competing ably in entertainment social media and virtual reality, Facebook’s drilling continues. Yes, Facebook may be free, but its monopoly harms Americans by stifling creator wages. The antitrust laws dictate that consumer harm is not a necessary condition for proving a monopoly under the Sherman Act; monopolies in and of themselves are illegal. By refiling the correct market definition and marketshare, the FTC stands more than a chance. It should win.
A prior version of this article originally appeared on Substack.
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This Week in Apps: In-app events hit the App Store, TikTok tries Stories, Apple reveals new child safety plan
Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.
The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.
Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.
This Week in Apps offers a way to keep up with this fast-moving industry in one place, with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.
Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters
Top Stories
Apple to scan for CSAM imagery
Apple announced a major initiative to scan devices for CSAM imagery. The company on Thursday announced a new set of features, arriving later this year, that will detect child sexual abuse material (CSAM) in its cloud and report it to law enforcement. Companies like Dropbox, Google and Microsoft already scan for CSAM in their cloud services, but Apple had allowed users to encrypt their data before it reached iCloud. Now, Apple’s new technology, NeuralHash, will run on users’ devices, tatformso detect when a users upload known CSAM imagery — without having to first decrypt the images. It even can detect the imagery if it’s been cropped or edited in an attempt to avoid detection.
Meanwhile, on iPhone and iPad, the company will roll out protections to Messages app users that will filter images and alert children and parents if sexually explicit photos are sent to or from a child’s account. Children will not be shown the images but will instead see a grayed-out image instead. If they try to view the image anyway through the link, they’ll be shown interruptive screens that explain why the material may be harmful and are warned that their parents will be notified.
Some privacy advocates pushed back at the idea of such a system, believing it could expand to end-to-end encrypted photos, lead to false positives, or set the stage for more on-device government surveillance in the future. But many cryptology experts believe the system Apple developed provides a good balance between privacy and utility, and have offered their endorsement of the technology. In addition, Apple said reports are manually reviewed before being sent to the National Center for Missing and Exploited Children (NCMEC).
The changes may also benefit iOS developers who deal in user photos and uploads, as predators will no longer store CSAM imagery on iOS devices in the first place, given the new risk of detection.
In-App Events appear on the App Store
Image Credits: Apple
Though not yet publicly available to all users, those testing the new iOS 15 mobile operating system got their first glimpse of a new App Store discovery feature this week: “in-app events.” First announced at this year’s WWDC, the feature will allow developers and Apple editors alike to showcase directly on the App Store upcoming events taking place inside apps.
The events can appear on the App Store homepage, on the app’s product pages or can be discovered through personalized recommendations and search. In some cases, editors will curate events to feature on the App Store. But developers will also be provided tools to submit their own in-app events. TikTok’s “Summer Camp” for creators was one of the first in-app events to be featured, where it received a top spot on the iPadOS 15 App Store.
Weekly News
Platforms: Apple
Apple expands support for student IDs on iPhone and Apple Watch ahead of the fall semester. Tens of thousands more U.S. and Canadian colleges will now support mobile student IDs in the Apple Wallet app, including Auburn University, Northern Arizona University, University of Maine, New Mexico State University and others.
Apple was accused of promoting scam apps in the App Store’s featured section. The company’s failure to properly police its store is one thing, but to curate an editorial list that actually includes the scams is quite another. One of the games rounded up under “Slime Relaxations,” an already iffy category to say the least, was a subscription-based slime simulator that locked users into a $13 AUD per week subscription for its slime simulator. One of the apps on the curated list didn’t even function, implying that Apple’s editors hadn’t even tested the apps they recommend.
Tax changes hit the App Store. Apple announced tax and price changes for apps and IAPs in South Africa, the U.K. and all territories using the Euro currency, all of which will see decreases. Increases will occur in Georgia and Tajikistan, due to new tax changes. Proceeds on the App Store in Italy will be increased to reflect a change to the Digital Services Tax effective rate.
Game Center changes, too. Apple said that on August 4, a new certificate for server-based Game Center verification will be available via the publicKeyUrl.
Fintech
Robinhood stock jumped more than 24% to $46.80 on Tuesday after initially falling 8% on its first day of trading last week, after which it had continued to trade below its opening price of $38.
Square’s Cash app nearly doubled its gross profit to $546 million in Q2, but also reported a $45 million impairment loss on its bitcoin holdings.
Coinbase’s app now lets you buy your cryptocurrency using Apple Pay. The company previously made its Coinbase Card compatible with Apple Pay in June.
Social
An anonymous app called Sendit, which relies on Snap Kit to function, is climbing the charts of the U.S. App Store after Snap suspended similar apps, YOLO and LMK. Snap was sued by the parent of child who was bullied through those apps, which led to his suicide. Sendit also allows for anonymity, and reviews compare it to YOLO. But some reviews also complained about bullying. This isn’t the first time Snap has been involved in a lawsuit related to a young person’s death related to its app. The company was also sued for its irresponsible “speed filter” that critics said encouraged unsafe driving. Three young men died using the filter, which captured them doing 123 mph.
TikTok is testing Stories. As Twitter’s own Stories integrations, Fleets, shuts down, TikTok confirmed it’s testing its own Stories product. The TikTok Stories appear in a left-hand sidebar and allow users to post ephemeral images or video that disappear in 24 hours. Users can also comment on Stories, which are public to their mutual friends and the creator. Stories on TikTok may make more sense than they did on Twitter, as TikTok is already known as a creative platform and it gives the app a more familiar place to integrate its effects toolset and, eventually, advertisements.
Facebook has again re-arranged its privacy settings. The company continually moves around where its privacy features are located, ostensibly to make them easier to find. But users then have to re-learn where to go to find the tools they need, after they had finally memorized the location. This time, the settings have been grouped into six top-level categories, but “privacy” settings have been unbundled from one location to be scattered among the other categories.
A VICE report details ban-as-a-service operations that allow anyone to harass or censor online creators on Instagram. Assuming you can find it, one operation charged $60 per ban, the listing says.
TikTok merged personal accounts with creator accounts. The change means now all non-business accounts on TikTok will have access to the creator tools under Settings, including Analytics, Creator Portal, Promote and Q&A. TikTok shared the news directly with subscribers of its TikTok Creators newsletter in August, and all users will get a push notification alerting them to the change, the company told us.
Discord now lets users customize their profile on its apps. The company added new features to its iOS and Android apps that let you add a description, links and emojis and select a profile color. Paid subscribers can also choose an image or GIF as their banner.
Twitter Spaces added a co-hosting option that allows up to two co-hosts to be added to the live audio chat rooms. Now Spaces can have one main host, two co-hosts and up to 10 speakers. Co-hosts have all the moderation abilities as hosts, but can’t add or remove others as co-hosts.
Messaging
Tencent reopened new user sign-ups for its WeChat messaging app, after having suspended registrations last week for unspecified “technical upgrades.” The company, like many other Chinese tech giants, had to address new regulations from Beijing impacting the tech industry. New rules address how companies handle user data collection and storage, antitrust behavior and other checks on capitalist “excess.” The gaming industry is now worried it’s next to be impacted, with regulations that would restrict gaming for minors to fight addiction.
WhatsApp is adding a new feature that will allow users to send photos and videos that disappear after a single viewing. The Snapchat-inspired feature, however, doesn’t alert you if the other person takes a screenshot — as Snap’s app does. So it may not be ideal for sharing your most sensitive content.
Telegram’s update expands group video calls to support up to 1,000 viewers. It also announced video messages can be recorded in higher quality and can be expanded, regular videos can be watched at 0.5 or 2x speed, screen sharing with sound is available for all video calls, including 1-on-1 calls, and more.
Streaming & Entertainment
American Airlines added free access to TikTok aboard its Viasat-equipped aircraft. Passengers will be able to watch the app’s videos for up to 30 minutes for free and can even download the app if it’s not already installed. After the free time, they can opt to pay for Wi-Fi to keep watching. Considering how easy it is to fall into multi-hour TikTok viewing sessions without knowing it, the addition of the addictive app could make long plane rides feel shorter. Or at least less painful.
Chinese TikTok rival Kuaishou saw stocks fall by more than 15% in Hong Kong, the most since its February IPO. The company is another victim of an ongoing market selloff triggered by increasing investor uncertainty related to China’s recent crackdown on tech companies. Beijing’s campaign to rein in tech has also impacted Tencent, Alibaba, Jack Ma’s Ant Group, food delivery company Meituan and ride-hailing company Didi. Also related, Kuaishou shut down its controversial app Zynn, which had been paying users to watch its short-form videos, including those stolen from other apps.
Twitch overtook YouTube in consumer spending per user in April 2021, and now sees $6.20 per download as of June compared with YouTube’s $5.60, Sensor Tower found.
Image Credits: Sensor Tower
Spotify confirmed tests of a new ad-supported tier called Spotify Plus, which is only $0.99 per month and offers unlimited skips (like free users get on the desktop) and the ability to play the songs you want, instead of only being forced to use shuffle mode.
The company also noted in a forum posting that it’s no longer working on AirPlay2 support, due to “audio driver compatibility” issues.
Mark Cuban-backed audio app Fireside asked its users to invest in the company via an email sent to creators which didn’t share deal terms. The app has yet to launch.
YouTube kicks off its $100 million Shorts Fund aimed at taking on TikTok by providing creators with cash incentives for top videos. Creators will get bonuses of $100 to $10,000 based on their videos’ performance.
Dating
Match Group announced during its Q2 earnings it plans to add to several of the company’s brands over the next 12 to 24 months audio and video chat, including group live video, and other livestreaming technologies. The developments will be powered by innovations from Hyperconnect, the social networking company that this year became Match’s biggest acquisition to date when it bought the Korean app maker for a sizable $1.73 billion. Since then, Match was spotted testing group live video on Tinder, but says that particular product is not launching in the near-term. At least two brands will see Hyperconnect-powered integrations in 2021.
Photos
The Photo & Video category on U.S. app stores saw strong growth in the first half of the year, a Sensor Tower report found. Consumer spend among the top 100 apps grew 34% YoY to $457 million in Q2 2021, with the majority of the revenue (83%) taking place on iOS.
Image Credits: Sensor Tower
Gaming
Epic Games revealed the host of its in-app Rift Tour event is Ariana Grande, in the event that runs August 6-8.
Pokémon GO influencers threatened to boycott the game after Niantic removed the COVID safety measures that had allowed people to more easily play while social distancing. Niantic’s move seemed ill-timed, given the Delta variant is causing a new wave of COVID cases globally.
Health & Fitness
Apple kicked out an app called Unjected from the App Store. The new social app billed itself as a community for the unvaccinated, allowing like-minded users to connect for dating and friendships. Apple said the app violated its policies for COVID-19 content.
Google Pay expanded support for vaccine cards. In Australia, Google’s payments app now allows users to add their COVID-19 digital certification to their device for easy access. The option is available through Google’s newly updated Passes API which lets government agencies distribute digital versions of vaccine cards.
COVID Tech Connect, a U.S. nonprofit initially dedicated to collecting devices like phones and tablets for COVID ICU patients, has now launched its own app. The app, TeleHome, is a device-agnostic, HIPAA-compliant way for patients to place a video call for free at a time when the Delta variant is again filling ICU wards, this time with the unvaccinated — a condition that sometimes overlaps with being low-income. Some among the working poor have been hesitant to get the shot because they can’t miss a day of work, and are worried about side effects. Which is why the Biden administration offered a tax credit to SMBs who offered paid time off to staff to get vaccinated and recover.
Popular journaling app Day One, which was recently acquired by WordPress.com owner Automattic, rolled out a new “Concealed Journals” feature that lets users hide content from others’ viewing. By tapping the eye icon, the content can be easily concealed on a journal by journal basis, which can be useful for those who write to their journal in public, like coffee shops or public transportation.
Edtech
Recently IPO’d language learning app Duolingo is developing a math app for kids. The company says it’s still “very early” in the development process, but will announce more details at its annual conference, Duocon, later this month.
Educational publisher Pearson launched an app that offers U.S. students access to its 1,500 titles for a monthly subscription of $14.99. the Pearson+ mobile app (ack, another +), also offers the option of paying $9.99 per month for access to a single textbook for a minimum of four months.
News & Reading
Quora jumps into the subscription economy. Still not profitable from ads alone, Quora announced two new products that allow its expert creators to monetize their content on its service. With Quora+ ($5/mo or $50/yr), subscribers can pay for any content that a creator paywalls. Creators can choose to enable a adaptive paywall that will use an algorithm to determine when to show the paywall. Another product, Spaces, lets creators write paywalled publications on Quora, similar to Substack. But only a 5% cut goes to Quora, instead of 10% on Substack.
Utilities
Google Maps on iOS added a new live location-sharing feature for iMessage users, allowing them to more easily show your ETA with friends and even how much battery life you have left. The feature competes with iMessage’s built-in location-sharing feature, and offers location sharing of 1 hour up to 3 days. The app also gained a dark mode.
Security & Privacy
Controversial crime app Citizen launched a $20 per month “Protect” service that includes live agent support (who can refer calls to 911 if need be). The agents can gather your precise location, alert your designated emergency contacts, help you navigate to a safe location and monitor the situation until you feel safe. The system of live agent support is similar to in-car or in-home security and safety systems, like those from ADT or OnStar, but works with users out in the real world. The controversial part, however, is the company behind the product: Citizen has been making headlines for launching private security fleets outside law enforcement, and recently offered a reward in a manhunt for an innocent person based on unsubstantiated tips.
Funding and M&A
Square announced its acquisition of the “buy now, pay later” giant AfterPay in a $29 billion deal that values the Australian firm at more than 30% higher than the stock’s last closing price of AUS$96.66. AfterPay has served over 16 million customers and nearly 100,000 merchants globally, to date, and comes at a time when the BNPL space is heating up. Apple has also gotten into the market recently with an Affirm partnership in Canada.
Gaming giant Zynga acquired Chinese game developer StarLark, the team behind the mobile golf game Golf Rival, from Betta Games for $525 million in both cash and stock. Golf Rival is the second-largest mobile golf game behind Playdemic’s Golf Clash, and EA is in the process of buying that studio for $1.4 billion.
U.K.-based Humanity raised an additional $2.5 million for its app that claims to help slow down aging, bringing the total raise to date to $5 million. Backers include Calm’s co-founders, MyFitness Pal’s co-founder and others in the health space. The app works by benchmarking health advice against real-world data, to help users put better health practices into action.
YELA, a Cameo-like app for the Middle East and South Asia, raised $2 million led by U.S. investors that include Tinder co-founder Justin Mateen and Sean Rad, general partner of RAD Fund. The app is focusing on signing celebrities in the regions it serves, where smartphone penetration is high and over 6% of the population is under 35.
London-based health and wellness app maker Palta raised a $100 million Series B led by VNV Global. The company’s products include Flo.Health, Simple Fasting, Zing Fitness Coach and others, which reach a combined 2.4 million active, paid subscribers. The funds will be used to create more mobile subscription products.
Emoji database and Wikipedia-like site Emojipedia was acquired by Zedge, the makers of a phone personalization app offering wallpapers, ringtones and more to 35 million MAUs. Deal terms weren’t disclosed. Emojipedia says the deal provides it with more stability and the opportunity for future growth. For Zedge, the deal provides
….um, a popular web resource it thinks it can better monetize, we suspect.
Mental health app Revery raised $2 million led by Sequoia Capital India’s Surge program for its app that combines cognitive behavioral therapy for insomnia with mobile gaming concepts. The company will focus on other mental health issues in the future.
London-based Nigerian-operating fintech startup Kuda raised a $55 million Series B, valuing its mobile-first challenger bank at $500 million. The inside round was co-led by Valar Ventures and Target Global.
Vietnamese payments provider VNLife raised $250 million in a round led by U.S.-based General Atlantic and Dragoneer Investment Group. PayPal Ventures and others also participated. The round values the business at over $1 billion.
Downloads
Mastodon for iPhone
Fans of decentralized social media efforts now have a new app. The nonprofit behind the open source decentralized social network Mastodon released an official iPhone app, aimed at making the network more accessible to newcomers. The app allows you to find and follow people and topics; post text, images, GIFs, polls, and videos; and get notified of new replies and reblogs, much like Twitter.
Xingtu
@_666eveITS SO COOL FRFR do u guys want a tutorial? #fypシ #醒图 #醒图app♬ original sound – Ian Asher
TikTok users are teaching each other how to switch over to the Chinese App Store in order to get ahold of the Xingtu app for iOS. (An Android version is also available.) The app offers advanced editing tools that let users edit their face and body, like FaceTune, apply makeup, add filters and more. While image-editing apps can be controversial for how they can impact body acceptance, Xingtu offers a variety of artistic filters which is what’s primarily driving the demand. It’s interesting to see the lengths people will go to just to get a few new filters for their photos — perhaps making a case for Instagram to finally update its Post filters instead of pretending no one cares about their static photos anymore.
Tweets
Facebook still dominating top charts, but not the No. 1 spot:
Not cool, Apple:
This user acquisition strategy:
Maybe Stories don’t work everywhere:
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Spotify partners with GIPHY to connect users with artists’ music via GIFs
Spotify announced this morning a new partnership with online GIF database GIPHY to enable discovery of new music through GIFs. No, the GIFs themselves won’t play song clips, if that’s what you’re thinking. Instead, through a series of new Spotify-linked GIFs, there will be an option to click a button to be taken to Spotify directly to hear the artist’s music. At launch, artists including Doja Cat, The Weeknd, Post Malone, Nicki Minaj, The Kid LAROI, Conan Gray and others will have Spotify-linked GIFs available on their official GIPHY profile page. More artists will be added over time.
The idea behind the new integration is to help connect users with Spotify music from their everyday communications, like texts, group chats and other places where GIFs are used. This is similar to Spotify’s existing integrations with social media apps like Snapchat and Instagram, where users can share music through the Stories and messages they post. Essentially, it’s a user acquisition strategy that leverages online social activities — in this case, sharing GIFs — while also benefiting the artists through the exposure they receive.
You can find the new Spotify-linked GIFs on the artist’s page on GIPHY.com or through GIPHY’s mobile app. The supported GIFs will include a new “Listen on Spotify” button at the bottom which will appear alongside the GIF when it’s shared. When clicked, users are redirected from the GIF to the artist’s page on Spotify, where they can stream their music or browse to discover more songs they want to hear. We understand GIPHY worked in collaboration with the artists to bring their music to its platform, rather than the artists’ labels.
Image Credits: Spotify/GIPHY
Spotify says the feature is part of a broader partnership it has with GIPHY, which will later focus on bringing a more interactive listening experience to users.
The move to partner with GIPHY follows a recent expansion of the existing partnership between Spotify and GIPHY’s parent company, Facebook. The social networking giant bought the popular GIF platform in a deal worth a reported $400 million back in 2020, a couple years after Google snatched up GIPHY rival, Tenor. Since then, Facebook has worked to better integrate GIPHY with its apps, like Facebook and Instagram.
Earlier this year, Facebook and Spotify had also teamed up on a new “Boombox” project that allows Facebook users to listen to music hosted on Spotify while browsing the Facebook app. This is powered by a “miniplayer” that allows anyone who comes across the shared music to click to play the content while they scroll their feed.
Despite Spotify and Facebook’s ties, GIPHY notes it explored its partnership with Spotify as a standalone opportunity, separate from Facebook. The company said it plans to pursue further partnership opportunities with Spotify to make the user experience even more interactive in the future, as their relationship continues.
Spotify says the new feature will be available to users globally from verified GIPHY artists’ pages.
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Zebra raises $1.1M in a pre-seed round for messaging that pairs photos with voice chat
A new voice-based social app that cites Clubhouse as its biggest inspiration offers a playful new way to stay in touch with close friends and family. Zebra leaves video out of the equation altogether, inviting users to snap on-the-fly photos and send them off paired with casual voice updates.
Zebra focuses on asynchronous sharing, but it also lets users call one another if they’re both already hanging out on the app. The result is a fun and casual way to stay in touch for anyone who doesn’t feel like accidentally getting sucked into Instagram’s endless, ad-strewn feed every time they want to give a friend a quick update.
For now Zebra is a two-person team consisting of CEO Dennis Gecaj, a product designer based in Berlin, and Amer Shahnawaz, Zebra’s head of engineering, who previously worked on Snap Maps at Snapchat. The pre-seed funding was led by Alexis Ohanian’s fresh early-stage venture firm Seven Seven Six, which the Reddit co-founder announced in June. The app will launch formally in August but is now open for preorders through the App Store and as a beta in TestFlight.
“It’s no secret that we are in the midst of an audio revolution, one that has ushered in a series of new audio-first social platforms and content vehicles,” Ohanian said, noting that Zebra’s unique blend of photos and voice is what caught his eye.
Gecaj sees voice-based social networking as a much richer alternative to text-dominant platforms. While products like Instagram allow voice messages and technically let users make voice calls by disabling the camera, voice usually plays second fiddle to video. But video calls are more taxing and require more commitment — it’s no coincidence more and more Zoom cameras blinked offline as the pandemic dragged on.
Unlike Clubhouse, which Gecaj calls a “huge inspiration, Zebra is social audio designed for your inner circle. “With everything opening back up we saw an incredible opportunity for an asynchronous format for that,” he told TechCrunch.
Gecaj hopes that Zebra’s “talking photos” can capture the collective imagination in a way that makes early growth natural. Anyone who downloads Zebra can invite friends individually without needing to share their full contact list (and they’ll need to — you can’t do anything on the app without friends). Because Zebra’s interface is so clean and streamlined, this process is painless and doesn’t necessitate any extra digging through menus.
The idea of a “zebra” — naturally, Zebra is trying to make “zebra” happen — is that people like to see what they are talking about. On a different messaging app, this would require sending a photo and then sending a voice message in quick succession. But on Zebra, sending a photo is the main thing you can do. The app opens right to the camera where you snap a picture. You then hold the photo to record a snippet of voice to go along with it and send it off to friends and family, who appear in a row beneath the camera.
Zebra isn’t worried about the prospect of talking people into downloading another app. Gecaj sees a natural split emerging as creators and audiences increasingly become the focus of social platforms that were initially designed to help friends stay in touch.
“I think the trend is a division between creator platforms where you go to be entertained and platforms you go to hang out with your friends,” Gecaj told TechCrunch.
On top of that, he hopes that Zebra’s dual focus on voice and photos, two aspects of social networking that platforms either don’t prioritize or are actively abandoning, can make it appealing for people who aren’t as interested in video.
“We really also think that text messaging doesn’t have the same emotion as voice… and voice has been really neglected,” Gecaj said. “There’s really a richness to voice, a power to voice that nothing else has.”
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CockroachDB, the database that just won’t die
There is an art to engineering, and sometimes engineering can transform art. For Spencer Kimball and Peter Mattis, those two worlds collided when they created the widely successful open-source graphics program, GIMP, as college students at Berkeley.
That project was so successful that when the two joined Google in 2002, Sergey Brin and Larry Page personally stopped by to tell the new hires how much they liked it and explained how they used the program to create the first Google logo.
Cockroach Labs was started by developers and stays true to its roots to this day.
In terms of good fortune in the corporate hierarchy, when you get this type of recognition in a company such as Google, there’s only one way you can go — up. They went from rising stars to stars at Google, becoming the go-to guys on the Infrastructure Team. They could easily have looked forward to a lifetime of lucrative employment.
But Kimball, Mattis and another Google employee, Ben Darnell, wanted more — a company of their own. To realize their ambitions, they created Cockroach Labs, the business entity behind their ambitious open-source database CockroachDB. Can some of the smartest former engineers in Google’s arsenal upend the world of databases in a market spotted with the gravesites of storage dreams past? That’s what we are here to find out.
Berkeley software distribution
Mattis and Kimball were roommates at Berkeley majoring in computer science in the early-to-mid-1990s. In addition to their usual studies, they also became involved with the eXperimental Computing Facility (XCF), an organization of undergraduates who have a keen, almost obsessive interest in CS.
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Digital greeting card startup Givingli raises $3 million seed round
While the digital revolution has transformed nearly every social interaction and communication type in the past couple decades, the humble birthday card has shown surprising resiliency.
Givingli, a small LA-based startup with an app aiming to challenge how Gen Z sends digital greeting cards, is picking up some seed funding from investors betting on their philosophy around modern gifting. The startup has raised a $3 million seed round led by Reddit co-founder Alexis Ohanian’s Seven Seven Six, while Snap’s Yellow Accelerator also participated in the raise.
The wife and husband co-founding team stumbled into the world of digital greetings and gifts after abandoning physical invitations for their wedding and exploring how the digital greetings space had and hadn’t evolved. They’ve taken a mobile-first approach to tackling greetings for special events and moments where users just want to let someone know they’re thinking of them.
Image Credits: Givingli
“Initially, we thought it would mainly be birthdays and categories like weddings, graduation, etc., and I think we just threw in some ‘just because’ cards, but then that became the most popular category, by far,” CEO Nicole Emrani Green tells TechCrunch. “I think that it’s what kicked off our virality, because obviously with every Givingli sent you’re pulling someone else in and then the conversation continues.”
The app monetizes through a $3.99 monthly premium subscription that gives users access to a greater variety of digital greeting designs from the more than 40 artists that the startup has licensed work from. Alongside paying for premium subscriptions, users can also shop for digital gift cards to send along with their greetings. Givingli’s gift card storefront has more than 150 brands available including Amazon, Spotify, Nike and DoorDash.
A big sell for Givingli’s offering has been its customization. Although users are pushed to select from the hundreds of available greeting cards, they can also spice them up by adding photos or videos in addition to writing text. The aim is to create a moment that rivals messages that can be shared via email, text or on social media services.
“For a generation of digitally native users, it’s not surprising that the ability to like, swipe, upvote or shoot a quick text from our phones have become the predominant ways we connect with others,” said Ohanian in a press release announcing the seed round. “What first attracted me to Givingli is that Nicole and Ben acutely understood this evolution and built a platform that provides the creative tools needed to elevate those interactions and deepen connections. Whether it’s sending a digital birthday gift, or a note just because — it’s clear that Givingli has put snail mail on notice.”
One of the team’s big challenges has been highlighting the visibility of their native app that users download to send greetings. Last fall, the Givingli team debuted a partnership with Snap that brought their gifting service inside Snapchat via a bite-sized Snap Mini app integration. The rollout followed the startup’s participation in Snap’s Yellow Accelerator program.
Emrani Green says that partnership has helped bring more users to their platform, and that more than 5 million people have used Givingli to send greetings since the app launched in 2019.
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Poparazzi hypes itself to the top of the App Store
If Instagram’s photo tagging feature was spun out into its own app, you’d have the viral sensation Poparazzi, now the No. 1 app on the App Store. The new social networking app, from the same folks behind TTYL and others, lets you create a social profile that only your friends can post photos to — in other words, making your friends your own “paparazzi.” To its credit, the new app has perfectly executed on a series of choices designed to fuel day-one growth — from its prelaunch TikTok hype cycle to drive App Store preorders to its postlaunch social buzz, including favorable tweets by its backers. But the app has also traded user privacy in some cases to amplify network effects in its bid for the Top Charts, which is a risky move in terms of its long-term staying power.
The company positions Poparazzi as a sort of anti-Instagram, rebelling against today’s social feeds filled with edited photos, too many selfies and “seemingly effortless perfection.” People’s real lives are made up of many unperfect moments that are worthy of being captured and shared, too, a company blog post explains.
This manifesto hits the right notes at the right time. User demand for less performative social media has been steadily growing for years — particularly as younger, Gen Z users wake up to the manipulations by tech giants. We’ve already seen a number of startups try to siphon users away from Instagram using similar rallying cries, including Minutiae, Vero, Dayflash, Oggl and, more recently, the once-buzzy Dispo and the under-the-radar Herd.
Even Facebook has woken up to consumer demand on this front, with its plan to roll out new features that allow Facebook and Instagram users to remove the Like counts from their posts and their feeds.
Poparazzi hasn’t necessarily innovated in terms of its core idea — after all, tagging users in photos has existed for years. In fact, it was one of the first viral effects introduced by Facebook in its earlier days.
Instead, Poparazzi hit the top of the charts by carefully executing on growth strategies that ensured a rocket ship-style launch.
@poparazziappcomment it! ##greenscreen ##poparazziapp ##positivity ##foryoupage♬ Milkshake – BBY Kodie
The company began gathering prelaunch buzz by driving demand via TikTok — a platform that’s already helped mint App Store hits like the mobile game High Heels. TikTok’s powers are still often underestimated, even though its potential to send apps up the Top Charts have successfully boosted downloads for a number of mobile businesses, including TikTok sister app CapCut and e-commerce app Shein, for example.
And Poparazzi didn’t just build demand on TikTok — it actually captured it by pointing users to its App Store preorders page via the link in its bio. By the time launch day rolled around, it had a gaggle of Gen Z users ready and willing to give Poparazzi a try.
The app launches with a clever onboarding screen that uses haptics to buzz and vibrate your phone while the intro video plays. This is unusual enough that users will talk and post about how cool it was — another potential means of generating organic growth through word-of-mouth.
@poparazzidotcom ‘s app & website (https://t.co/EGU0K6AVS3) experience is amazing
#poparazzi pic.twitter.com/NqJWD5T5Sg
— 𝔗𝔞𝔫𝔦𝔰𝔥 𝔄𝔯𝔬𝔯𝔞 (@tanishar0ra) May 25, 2021
After getting you riled up with excitement, Poparazzi eases you into its bigger data grab.
First, it signs up and authenticates users through a phone number. Despite Apple’s App Store policy, which requires it, there is no privacy-focused option to use “Sign In with Apple,” which allows users to protect their identity. That would have limited Poparazzi’s growth potential versus its phone number and address book access approach.
It then presents you with a screen where it asks for permission to access your Camera (an obvious necessity) and Contacts (wait, all of them?), and permission to send you Notifications. This is where things start to get more dicey. The app, like Clubhouse once did, demands a full address book upload. This is unnecessary in terms of an app’s usability, as there are plenty of other ways to add friends on social media — like by scanning each other’s QR code, typing in a username directly or performing a search.
But gaining access to someone’s full Contacts database lets Poparazzi skip having to build out features for the privacy-minded. It can simply match your stored phone numbers with those it has on file from user signups and create an instant friend graph.
As you complete each permission, Poparazzi rewards you with green checkmarks. In fact, even if you deny the permission being asked, the green check appears. This may confuse users as to whether they’ve accidently given the app access.
They had a killer and engaging intro video complete with gravity falling emoji and well-tuned haptics that built hype and informed proper use
(I feel like a lot of people these days actually download without knowing this stuff now, making onboarding even more important) pic.twitter.com/duUelcDm0H
— Chase Stubblefield
(@chasestubb) May 25, 2021
While you can “deny” the Address Book upload — a request met with a tsk tsk of a pop-up message — Poparazzi literally only works with friends, it warns you — you can’t avoid being found by other Poparazzi users who have your phone number stored in their phone.
When users sign up, the app matches their address book to the phone number it has on file and then — boom! — new users are instantly following the existing users. And if any other friends have signed up before you, they’ll be following you as soon as you log in the first time.
In other words, there’s no manual curation of a “friend graph” here. The expectation is that your address book is your friend graph, and Poparazzi is just duplicating it.
Of course, this isn’t always an accurate presentation of reality.
Many younger people, and particularly women, have the phone numbers of abusers, stalkers and exes stored in their phone’s Contacts. By doing so, they can leverage the phone’s built-in tools to block the unwanted calls and texts from that person. But because Poparazzi automatically matches people by phone number, abusers could gain immediate access to the user profiles of the people they’re trying to harass or hurt.
Sure, this is an edge case. But it’s a nontrivial one.
It’s a well-documented problem, too — and one that had plagued Clubhouse, which similarly required full address book uploads during its early growth phase. It’s a terrible strategy to become the norm, and one that does not appear to have created a lasting near-term lock-in for Clubhouse. It’s also not a new tactic. Mobile social network Path tried address book uploads nearly a decade ago and almost everyone at the time agreed this was not a good idea.
As carefully designed as Poparazzi is — (it’s even got a blue icon — a color that denotes trustworthiness!) — it’s likely the company intentionally chose the trade-off. It’s forgoing some aspects of user privacy and safety in favor of the network effects that come from having an instant friend graph.
More on @poparazzidotcom: they force you to upload your contacts to use it, as well as phone number—and also have this aggressive strategy to pull users from Snapchat. pic.twitter.com/SFx0TdCkaR
— Chase Stubblefield
The rest of the app then pushes you to grow that friend graph further and engage with other users. Your profile will remain bare unless you can convince someone to upload photos of you. A SnapKit integration lets you beg for photo tags over on Snapchat. And if you can’t get enough of your friends to tag you in photos, then you may find yourself drawn to the setting “Allow Pops from Everyone,” instead of just “People You Approve.”
There’s no world in which letting “everyone” upload photos to a social media profile doesn’t invite abuse at some point, but Poparazzi is clearly hedging its bets here. It likely knows it won’t have to deal with the fallout of these choices until further down the road — after it’s filled out its network with millions of disgruntled Instagram users, that is.
Dozens of other growth hacks are spread throughout the app, too, from multiple pushes to invite friends scattered throughout the app to a very Snapchatt-y “Top Poparazzi” section that will incentivize best friends to keep up their posting streaks.
It’s a clever bag of tricks. And though the app does not offer comments or followers counts, it isn’t being much of an “anti-Instagram” when it comes to chasing clout. The posts — which can turn into looping GIFs if you snap a few in a row — may be more “authentic” and unedited than those on Instagram; but Poparazzi users react to posts with a range of emojis and how many reactions a post receives is shown publicly.
For beta testers featured on the explore page, reactions can be in the hundreds or thousands — effectively establishing a bar for Pop influence.
Finally, users you follow have permission to post photos, but if you unfollow them — a sure sign that you no longer want them to be in your poparazzi squad — they can still post to your profile. As it turns out, your squad is managed under a separate setting under “Allow Pops From.” That could lead to trouble. At the very least, it would be nice to see the app asking users if they also want to remove the unfollowed account’s permission to post to your profile at the time of the unfollow.
Overall, the app can be fun — especially if you’re in the young, carefree demographic it caters to. Its friend-centric and ironically anti-glam stance is promising as well. But additional privacy controls and the ability to join the service in a way that offers far more granular control of your friend graph in order to boost anti-abuse protections would be welcome additions.
TechCrunch tried to reach Poparazzi’s team to gain their perspective on the app’s design and growth strategy, but did not hear back. (We understand they’re heads down for the time being.) We understand, per SignalFire’s Josh Constine and our own confirmation, that Floodgate has invested in the startup, as has former TechCrunch co-editor Alexia Bonatsos’ Dream Machine and Weekend Fund.
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Snap acquires AR startup WaveOptics, which provides tech for Spectacles, for over $500M
Snap yesterday announced the latest iteration of its Spectacles augmented reality glasses, and today the company revealed a bit more news: it is also acquiring the startup that supplied the technology that helps power them. The Snapchat parent is snapping up WaveOptics, an AR startup that makes the waveguides and projectors used in AR glasses. These overlay virtual images on top of the views of the real world someone wearing the glasses can see, and Snap worked with WaveOptics to build its latest version of Spectacles.
The deal was first reported by The Verge, and a spokesperson for Snap directly confirmed the details to TechCrunch. Snap is paying over $500 million for the startup, in a cash-and-stock deal. The first half of that will be coming in the form of stock when the deal officially closes, and the remainder will be payable in cash or stock in two years.
This is a big leap for WaveOptics, which had raised around $65 million in funding from investors that included Bosch, Octopus Ventures and a host of individuals, from Stan Boland (veteran entrepreneur in the UK, most recently at FiveAI) and Ambarish Mitra (the co-founder of early AR startup Blippar). PitchBook estimates that its most recent valuation was only around $105 million.
WaveOptics was founded in Oxford, and from what we know it will continue to be based in the UK.
We have been covering the company since its earliest days, when it displayed some very interesting, early, and ahead-of-its-time technology: waveguides based on hologram physics and photonic crystals. The important and key thing is that its tech drastically compresses size and load of the hardware needed to process and display images, meaning a much wider and more flexible range of form factors for AR hardware based on WaveOptics tech.
It’s not clear whether WaveOptics will continue to work with other parties post-deal, but it seems that one obvious advantage for Snap would be making the startup’s technology exclusive to itself.
Snap has been on something of an acquisition march in recent times — it’s made at least three other purchases of startups since January, including Fit Analytics for an AR-fuelled move into e-commerce, as well as Pixel8Earth and StreetCred for its mapping tools.
This deal, however, marks Snap’s biggest acquisition to date in terms of valuation. That is not only a mark of the premium price that foundational artificial intelligence tech continues to command — in addition to the team of scientists that built WaveOptics, it also has 12 filed and in-progress patents — but also Snap’s financial and, frankly, existential commitment to having a seat at the table when it comes not just to social apps that use AR, but hardware, and being at the centre of not just using the tech, but setting the pace and agenda for how and where that will play out.
That’s been a tenacious and not always rewarding place for it to be, but the company — which has long described itself as a “camera company” — has kept hardware in the mix as an essential component for its future strategy.
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Snap announces Story Studio, a new standalone app to edit stories
During Snap Partner Summit, Snap announced a brand new app focused on creators. Named Story Studio, this standalone iOS app gives you several editing tools so you can make your content look as professional as possible.
Story editing tools are still in Snapchat — nothing is changing on this front. But if you’ve been creating content for Spotlight, a TikTok-like feed, or if you’re a Snap star, you may need more powerful editing tools. Many creators choose to edit their stories on a computer.
But many creators also want to do everything on their phones. That’s why there are already a few powerful video editing tools out there. But Snap is making its own app so that it works better with Snapchat.
With Story Studio, you can see what’s trending on Snapchat already. It includes sounds, topics and lenses. This way, you can remix popular content and create your own take on the current meme.
Snap says that Story Studio lets you trim your shots with frame-precise editing. You can add captions, stickers and other visual elements. You can also take advantage of the company’s licensed music catalog.
And because it’s supposed to be a serious app for serious stories, you can save a project and edit it later.
When you’re done, you can share your video with Snapchat — you can use it to post a story or a Spotlight video. But Story Studio is also going to work with other platforms. You can save it to your camera roll or export your video to other apps on your phone.
Story Studio is launching later this year. It’s going to be available on iOS exclusively for now.
Image Credits: Snap
Send a gift to your favorite creator
While Snapchat started as an app to chat with your friends, it’s clear that the company now wants to attract a generation of creators with the right tools and monetization options. Creators have become a competitive space for social apps, such as TikTok, Instagram, YouTube with YouTube Shorts and Snapchat.
Snap’s own take on short viral videos have been working relatively well so far. Spotlight reaches 125 million monthly active users on Snapchat. The number of users watching at least 10 minutes of Spotlight per day has grown by 70% between January and March.
In addition to Story Studio, Snap is launching a web platform for Spotlight. This way, people can watch Spotlight content without launching Snapchat even when they’re browsing the web on their desktop computer. It could be a way to attract new Snapchat users as well.
But creators in particular are going to like this website as you can upload videos to Spotlight from Chrome or Safari.
When it comes to monetization, Snap is distributing $1 million every day to Snapchat users who create the top Snaps for Spotlight — 5,400 creators have earned $130 million since November 2020. The company will stop giving away $1 million per day on June 1st. Snap only says it plans to give millions every month.
But creators will be able to start accepting gifts directly on Snapchat. When Snapchat users reply to a story, they can buy Snap Tokens and send them as a gift — a virtual item with real-life value. The company hasn’t detailed how it plans to split revenue between Snap and creators. Gifting will roll out on Android and iOS later this year.
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