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Instagram launches ‘Live Rooms’ for live broadcasts with up to four creators

Published March 1, 2021

Instagram today announced it’s adding a much-requested feature to its app with the launch of “Live Rooms,” which allow up to four people to broadcast live together at the same time. Previously, the app only allowed users to live stream with one other person, similar to Facebook Live. The company says it hopes Live Rooms will open up more creative opportunities in terms of live broadcast formats to allow for things like live talk shows, expanded Q&A’s or interviews, jam sessions for musicians, live shopping experiences and more.

In addition to the ability to livestream with more people, Instagram also touts how the new feature can help creators to make more money. Last year, in the early days of the COVID-19 crisis, Instagram introduced badges as a way for fans to support their favorite creators during a live video. Once purchased, the badges appear next to a fan’s name throughout the live video, helping them to stand out in the comments and unlock other special features, like placement on the creator’s list of badge holders and access to a special heart.

Badges became more broadly available last fall, at three price points: $0.99, $1.99 or $4.99.

With Live Rooms, fans can buy badges to support the hosts (one badge per person) as well as use other interactive features like Shopping and Live Fundraisers. The company says it’s also now developing other tools, like moderator controls and audio features that will roll out in the months to come.

To start a Live Room, you’ll swipe left and select the Live camera option, then title the Room and tap the Room icon to add guests. Here, you’ll see a list of people who’ve already requested to go live with you and you’ll be able to search for other guests to add.

Image Credits: Instagram

When you start the Live Room, you’ll remain at the top of the screen while guests are added. The guests can be added all at once or individually, depending on your preference. This allows for opportunities to add “surprise guests” to livestreams to keep fans engaged.

The ability to add more guests to a livestream can also help a creator grow their follower base, as all the guests’ followers are notified about the Live Room, in addition to your own.

For safety reasons, any person that’s been blocked by any of the Live Room participants will not have access to join the livestream. Plus, any guests who have previously had their live access revoked due to violations of Instagram’s Community Guidelines won’t be able to join any Live Rooms.

During live broadcasts, the hosts can also report and block comments and use comment filters to maintain a safer experience for all viewers.

Live broadcasts became an increasingly important way for creators, business owners and brands to stay connected with followers during the pandemic, which shut down in-person live events, including concerts, shows, classes, conferences, meetups and more. Instagram reported a 70% increase in Live views from February to March, for instance, as creators and businesses shifted their work online.

Image Credits: Instagram

As the pandemic wore on throughout 2020 and into 2021, the lack of in-person connection has allowed for other opportunities and even new social networks to grow. Live audio platform Clubhouse, for example, has seen rapid adoption, particularly by the tech and creative crowds, who today use the app to tune into live shows, chat sessions and even big-name interviews. Twitter is now building a rival, and reportedly, so is Facebook.

But while Clubhouse offers a very different experience, it still operates in the same broader space of allowing fans to connect with high-profile individuals of some sort — entrepreneurs and founders, celebrities, market experts, thought leaders, influencers and so on. And because users’ time is limited, seeing this type of activity shift to non-Facebook owned platforms is likely of concern to Instagram and its parent.

Meanwhile, in the live video broadcasting space, Instagram today faces a number of competitors, from those focused on a particular niche — like game streaming site Twitch, live shopping apps and more— as well as general purpose live platforms offered by YouTube and TikTok. (The latter was spotted offering a four-up livestream format just last month, in fact.)

Instagram says Live Rooms are rolling out now to both iOS and Android to all global markets. The company expects the rollout to reach 100% of its user base within the week.

Newness raises $3.5 million for its ‘Twitch for beauty streamers’

Early Stage is the premiere ‘how-to’ event for startup entrepreneurs and investors. You’ll hear firsthand how some of the most successful founders and VCs build their businesses, raise money and manage their portfolios. We’ll cover every aspect of company-building: Fundraising, recruiting, sales, legal, PR, marketing and brand building. Each session also has audience participation built-in – there’s ample time included in each for audience questions and discussion.

This Week in Apps: TikTok viral hit breaks Spotify records, inauguration boosts news app installs, judge rules against Parler

Published January 23, 2021

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 is as hot as ever, 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, we’re looking into how President Biden’s inauguration impacted news apps, the latest in the Parler lawsuit, and how TikTok’s app continues to shape culture, among other things.

Weekly News

Platforms: Apple

Apple stops signing iOS 12.5, making iOS 12.5.1 the only versions of iOS available to older devices.
A report claims Apple’s iOS 15 update will cut support for devices with an A9 chip, like the iPhone 6, iPhone 6s Plus and the original iPhone SE.
New analysis estimates Apple’s upcoming iOS privacy changes will cause a roughly 7% revenue hit for Facebook in Q2. The revenue hit will continue in following quarters and will be “material.”

Platforms: Google

Google adds “trending” icons to the Play Store. New arrow icons appeared in the Top Charts tab, which indicate whether an app’s downloads are trending up or down, in terms of popularity. This could provide an early signal about those that may still be rising in the charts or beginning to fall out of favor, despite their current high position.
Google appears to be working on a Restricted Networking mode for Android 12. The mode, discovered by XDA Developers digging in the Android Open Source Project, would disable network access for all third-party apps.

Gaming

Goama (or Go Games) introduced a way for developers to integrate social games into their apps, which was showcased at CES. The company focuses on Asia and Latin America and has more than 15 partners, including GCash and Rappi, for digital payments and communications.

Goama lets developers integrate a social gaming platform into their apps

Fortnite maker Epic Games is getting into movies. The animated feature film Gilgamesh will use Epic’s Unreal Engine technology to tell the story of the king-turned-deity. The movie is not an in-house project, but rather is financed through Epic’s $100M MegaGrants fund.

Augmented Reality

Patents around Apple’s AR and VR efforts describe how a system could be identified in a way that’s similar to FaceID, then either permitted or denied the ability to change their appearance in the game.
Pinterest launches AR try-on for eyeshadow in its mobile app using Lens technology and ModiFace data. The app already offered AR try-on for lipsticks.

Pinterest launches an AR-powered try-on experience for eyeshadow

Entertainment

The CW app became the No. 1 app on the App Store this week, topping TikTok, Instagram and YouTube, thanks to CW’s season premieres of Batwoman, All American, Riverdale and Nancy Drew.
Users of podcasting app Anchor, owned by Spotify, say the app isn’t bringing them any sponsorship opportunities, as promised, beyond those from Spotify and Anchor itself.
YouTube launches hashtag landing pages on the web and in its mobile app. The pages are accessible when you click hashtags on YouTube, not via search, and weirdly rank the “best” videos through some inscrutable algorithm.

YouTube launches hashtag landing pages to all users

Apple’s Podcasts app adds a new editorial feature, Apple Podcasts Spotlight, meant to increase podcast listening by showcasing the best podcasts as selected by Apple editors.

E-commerce

WeChat facilitated 1.6 trillion yuan (close to $250 billion) in annual transactions through its “mini programs” in 2020. The figure is more than double that of 2019.

WeChat advances e-commerce goals with $250B in transactions

Fintech

Douyin, the Chinese version of TikTok, launched an e-wallet, Douyin Pay. The wallet will supplement the existing payment options, Alipay and WeChat Pay, and will help to support the Douyin app’s growing e-commerce business.
Neobank Monzo founder Tom Blomfield left the startup, saying he struggled during the pandemic. “I think [for] a lot of people in the world…going through a pandemic, going through lockdown and the isolation involved in that has an impact on people’s mental health,” he told TechCrunch.

Monzo founder Tom Blomfield is departing the challenger bank and says he’s ‘struggled’ during the pandemic

New estimates indicate about 50% of the iPhone user base (or 507 million users) now use Apple Pay.
Samsung’s newest phones drop support for MST, which emulates a mag stripe at terminals that don’t support NFC.

Social

Indian messaging app, StickerChat, owned by Hike, is shutting down. Founder Kavin Bharti Mittal said India will never have a homegrown messenger unless it bars Western companies from its market. Hike pivoted this month to virtual social apps, Vibe and Rush, which it believes have more potential.
Instagram head Adam Mosseri, in a Verge podcast, said he’s not happy with Reels so far, and how he feels most people probably don’t understand the difference between Instagram video and IGTV. He says the social network needs to simplify and consolidate ideas.
Facebook and Instagram improve their accessibility features. The apps’ AI-generated image captions now offer far more details about who or what is in the photos, thanks to improvements in image recognition systems.
TikTok launches a Q&A feature that lets creators respond to fan questions using text or videos. The feature, rolled out to select creators with more than 10,000 followers, makes it easier to see all the questions in one place.

TikTok’s new Q&A feature lets creators respond to fan questions using text or video

Health & Fitness

Health and fitness app spending jumped 70% last year in Europe to record $544 million, a Sensor Tower report says. The year-over-year increase is far larger than 2019, when growth was just 37.2%. COVID-19 played a large role in this shift as people turned to fitness apps instead of gyms to stay in shape.

Government & Policy

Biden’s inauguration boosted installs of U.S. news apps up to 170%, Sensor Tower reported. CNN was the biggest mover, climbing 530 positions to reach No. 41 on the App Store, and up 170% in terms of downloads. News Break was the second highest, climbing 13 positions to No. 65. Right-wing outlet Newsmax climbed 43 spots to reach No. 108. In 2020, the top news apps were: News Break (23.7 million installs); SmartNews (9 million); CNN (5 million); and Fox News (4 million). This month, however, News Break saw 1.2 million installs, followed by Newsmax with about 863,000 installs, the report said.
Ireland’s Data Protection Commission (DPC) sent a draft decision to fellow EU Data Protection Authorities over the WhatsApp-Facebook data sharing policy. This means a decision on the matter is coming closer to a resolution in terms of what standards of transparency is required by WhatsApp.

WhatsApp-Facebook data-sharing transparency under review by EU DPAs after Ireland sends draft decision

German app developer Florian Mueller of FOSS Patents filed a complaint with the EU, U.S. DOJ and other antitrust watchdogs around the world over Apple and Google’s rejection of his COVID-related mobile game. Both stores had policies to only approve official COVID-19 apps from health authorities. Mueller renamed the game Viral Days and removed references to the novel coronavirus to get the app approved. However, he still feels the stores’ rules are holding back innovation.

Productivity

Basecamp’s Hey, which famously fought back against Apple’s App Store rules over IAP last year, has launched a business-focused platform, Hey for Work, expected to be public in Q1. The app has more App Store ratings than rival Superhuman, a report found. Currently, Hey has a 4.7-star rating across 3.3K reviews; Superhuman has 3.9 rating across only 274 reviews.

Trends

Baby boomers are increasingly using apps. Baby boomers/Gen Xers in the U.S. spent 30% more time year-over-year in their most used apps, App Annie reports. That’s a larger increase than either Millennials or Gen Z, at 18% and 16%, respectively.

Funding and M&A

Curtsy, a clothing resale app for Gen Z women, raised an $11 million Series A led by Index Ventures. The app tackles some of the problems with online resale by sending shipping supplies and labels to sellers, and by making the marketplace accessible to new and casual sellers.
Storytelling platform Wattpad acquired by South Korea’s Naver for $600 million. The reading apps whose stories have turned into book and Netflix hits will be incorporated into Naver’s publishing platform Webtoon.

Wattpad, the storytelling platform, is selling to South Korea’s Naver for $600 million

On-demand delivery app Glovo partnered with Swiss-based real estate firm, Stoneweg, which is investing €100 million in building and refurbishing real estate in key markets to build out Glovo’s network of “dark stores.”
Pocket Casts app is up for sale. The podcast app was acquired nearly three years ago by a public radio consortium of top podcast producers (NPR, WNYC Studios, WBEZ Chicago and This American Life). The owners have now agreed to sell the app, which posted a net loss in 2020. (NPR’s share of the loss was over $800,000.)
Travel app Maps.me raised $50 million in a round led by Alameda Research. The funding will go toward the launch of a multi-currency wallet. Cryptocurrency lender Genesis Capital and institutional cryptocurrency firm CMS Holdings also participated in the round, Coindesk reported.
Bangalore-based hyperlocal delivery app Dunzo raised $40 million in a round that included investment from Google, Lightbox, Evolvence, Hana Financial Investment, LGT Lightstone Aspada and Alteria.
London-based food delivery app Deliveroo raised $180 million in new funding from existing investors, led by Durable Capital Partners and Fidelity Management, valuing the business at more than $7 billion.
Dating Group acquired Swiss startup Once, a dating app that sends one match per day, for $18 million.

‘Slow dating’ app Once is acquired by Dating Group for $18M as it seeks to expand its portfolio

Downloads

Bodyguard

Image Credits: Bodyguard

A French content moderation app called Bodyguard, detailed here by TechCrunch, has brought its service to the English-speaking market. The app allows you to choose the level of content moderation you want to see on top social networks, like Twitter, YouTube, Instagram and Twitch. You can choose to hide toxic content across a range of categories, like insults, body shaming, moral harassment, sexual harassment, racism and homophobia and indicate whether the content is a low or high priority to block.

Bodyguard is a mobile app that hides toxic content on social platforms

Beeper

Image Credits: Beeper

Pebble’s founder and current YC Partner Eric Migicovsky has launched a new app, Beeper, that aims to centralize in one interface 15 different chat apps, including iMessage. The app relies on an open-source federated, encrypted messaging protocol called Matrix that uses “bridges” to connect to the various networks to move the messages. However, iMessage support is more wonky, as the company actually ships you an old iPhone to make the connection to the network. But this system allows you to access Beeper on non-Apple devices, the company says. The app is slowly onboarding new users due to initial demand. The app works across MacOS, Windows, Linux‍, iOS and Android and charges $10/mo for the service.

Pebble founder launches Beeper, a universal chat app that works with iMessage and others

‘Animal Crossing: New Horizons’ and the limits of today’s game economies

Published July 17, 2020

Kaiser Hwang
Contributor

Kaiser Hwang is a longtime member of the games community and a vice president at Forte, an organization building an open economic platform for games.

“Animal Crossing: New Horizons” is a bonafide wonder. The game has been setting new records for Nintendo, is adored by players and critics alike and provides millions of players a peaceful escape during these unprecedented times.

But there’s been something even more extraordinary happening on the fringe: Players are finding ways to augment the game experience through community-organized activities and tools. These include free weed-pulling services (tips welcome!) from virtual Samaritans, and custom-designed items for sale — for real-world money, via WeChat Pay and AliPay.

Well-known personalities and companies are also contributing, with “Rogue One: A Star Wars Story” scribe Gary Whitta hosting an A-list celebrity talk show using the game, and luxury fashion brand Marc Jacobs providing some of its popular clothing designs to players. 100 Thieves, the white-hot esports and apparel company, even created and gave away digital versions of its entire collection of impossible-to-find clothes.

This community-based phenomenon gives us a pithy glimpse into not only where games are inevitably going, but what their true potential is as a form of creative, technical and economic expression. It also exemplifies what we at Forte call “community economics,” a system that lies at the heart of our aim in bringing new creative and economic opportunities to billions of people around the world.

What is community economics?

Formally, community economics is the synthesis of economic activity that takes place inside, and emerges outside, virtual game worlds. It is rooted in a cooperative economic relationship between all participants in a game’s network, and characterized by an economic pluralism that is unified by open technology owned by no single party. And notably, it results in increased autonomy for players, better business models for game creators, and new economic and creative opportunities for both.

The fundamental shift that underlies community economics is the evolution of games from centralized entertainment experiences to open economic platforms. We believe this is where things are heading.

Investor survey results: Upcoming trends in social startups

Published April 7, 2020

Voice-based social networks and gaming as a new form of identity were among the top emerging trends in consumer social startups, according to an Extra Crunch survey of top social tech investors. Meanwhile, anonymity and dating apps with a superfluous twist were spaces where investors were most pessimistic.

Extra Crunch assembled a list of the most prolific and well-respected investors in social. Many have funded or worked for the breakout companies changing the way we interact with other people. We asked about the most exciting trends they’re seeing and which areas they expect will soon spawn blockbuster social apps.

Subscribe to Extra Crunch to read the full answers to our questionnaire from funds like Andreessen Horowitz, CRV and Initialized.

Here are the 16 leading social network VCs that participated in our survey:

Olivia Moore, CRV
Justine Moore, CRV
Connie Chan, Andreessen Horowitz
Alexis Ohanian, Initialized Capital
Niko Bonatsos, General Catalyst
Josh Coyne, Kleiner Perkins
Wayne Hu, Signal Fire
Alexia Bonatsos, Dream Machine
Josh Elman, Angel Investor
Aydin Senkut, Felicis Ventures
James Currier, NFX
Pippa Lamb, Sweet Capital
Christian Dorffer, Sweet Capital
Jim Scheinman, Maven Ventures
Eva Casanova, Day One Ventures
Dan Ciporin, Canaan

Stay tuned next week for a follow-up article from these investors detailing their thoughts on social investing in the COVID-19 era.

Olivia Moore & Justine Moore, CRV

What trends are you most excited about in social from an investing perspective?

First, it’s worth noting that consumer social is very hard to predict. Unlike enterprise software, there’s no rational buyer, and the things that take off can seem “random” or dumb. Startups that see huge success in this space are often pioneering a new feature or way of communicating that hasn’t existed before. Any VC who claims to know what the “next big thing” in consumer social will look like should probably go build it themselves!

With kids and adults staying at home, are virtual worlds ready for primetime?

Published March 22, 2020

We’ve been diligently following the development of virtual worlds, also known as the “metaverse,” on TechCrunch.

Hanging out within the virtual worlds of games has become more popular in recent years with the growth of platforms like Roblox and open-world games like Fortnite, but it still isn’t a mainstream way to socialize outside of the young-adult demographic.

Three weeks ago, TechCrunch media columnist Eric Peckham published an in-depth report that positioned virtual worlds as the next era of social media. In an eight-part series, he looked at the history of virtual worlds and why games are already social networks, why social networks want more gaming, what the next few years looks like for the industry and why isn’t it mainstream already, how these virtual worlds will lead to healthier social relations, what the future of virtual economies will be and which companies are poised for success in this new market.

Given all that has changed in just the last three weeks — who would have thought that large swaths of the knowledge economy would suddenly find themselves entirely interacting virtually? — I wanted to get a sense of what the rising popularity of virtual worlds looks like in the midst of the outbreak of novel coronavirus. Eric and I had a call to discuss this and decided to share our conversation publicly.

Danny Crichton: So let’s talk about timing a bit. You wrote this eight-article series around virtual worlds and then all of a sudden post-publication there is this massive event — the novel coronavirus pandemic — causing a large portion of the human population to stay at home and interact only online. What’s happening now in the space?

Eric Peckham: I wrote my series on the multiverse because I was already seeing a surge of interest, both in terms of consumer demand for open-world MMO games and in terms of social media giants like Facebook and Snap trying to incorporate virtual worlds and social games into their platforms. Large companies are planning for virtual worlds in a way that is actionable and not just a futuristic vision. Over the last couple of years there has also been a lot of VC investment into a handful of startups focused on building next-generation virtual worlds for people to spend time in, virtual worlds with complex societies shaped by users’ contributions.

Talking to founders and investors in the gaming space, there has been a huge increase in usage over the last few weeks as more people hang out at home playing games, whether it’s on the adult side or the kid side.

Most of these next-generation virtual worlds are still in private beta but already popular platforms like Roblox, Minecraft, and Fortnite are getting substantially more use than normal. A large portion of people stuck at home are escaping via the virtual worlds of games.

You wrote this whole analysis before you knew the extent of the pandemic — how has the outlook changed for this industry?

This accelerates the timeline of virtual worlds being a mainstream place to hang out and socialize in daily life. I think people will be at home for multiple months, not just a couple of weeks, and it’s going to change people’s perspectives on socializing and working from home.

That’s a really powerful cultural shift. It’s getting more people beyond the core gaming community excited about spending time in virtual worlds and hanging out with their friends there.

We have seen this most heavily with the youngest generation of internet users. The majority of kids 9-12 years old are users of Minecraft and Roblox who hang out there with friends after school. We’ll see that expand to older demographics more quickly than it was going to before.

One of the complaints that I’ve seen on Twitter is that even though we have one of the largest global human lockdowns of all time, all the VR headsets are basically gone. Is VR a key component of virtual worlds?

Well, you don’t need VR headsets in order to spend meaningful time with others in a virtual space. Hundreds of millions of people already do it through their mobile phones and through PCs and consoles.

This is at the heart of the gaming industry: creating virtual worlds for people to spend time in, both pursuing the mission of whatever a game is designed for but also interacting with others. Among the most popular mobile and PC games last year were massively multiplayer online (MMO) games.

Talking about gaming, one facet of the story that I thought was particularly interesting was the fact that gaming was still not that high in terms of market penetration in the population.

More than two billion people play video games in the context of a year. There’s incredible market penetration in that sense. But, at least for the data I’ve seen for the U.S., the percent of the population who play games on a given day is still much lower than the percent of the population who use social media on a given day.

The more that games become virtual worlds for socializing and hanging out beyond just the mission of the gameplay, the more who will turn to virtual worlds as a social and entertainment outlet when they have five minutes free to do something on their phone. Social media fills these small moments in life. MMO games right now don’t because they are so oriented around the gameplay, which takes time and uninterrupted focus. Virtual worlds in the vein of those on Roblox where you just hang out and explore with friends compete for that time with Instagram more directly.

Theater chains like Regal and AMC announced this week that they are entirely shutting down to wait out the pandemic. Is that going to affect these virtual world companies?

I think they are separate parts of media. Cinema attendance has been declining quite substantially for years, and the way the industry has made up for that is trying to turn cinemas into these premium experiences and increasing ticket prices. Kids are just as likely, if not more likely, to play a game together on a Friday night as they are to go to the cinema. Cinemas are less culturally relevant to young people than they once were.

We’ve seen a massive experiment in work from home, which is a form of virtual world, or at least, a virtual workplace. When it comes to popularizing virtual worlds, is it going to come from the entertainment side or the more productivity-oriented platforms?

It will come from the entertainment side, and from younger people using it to socialize, in part because there’s less fear around cultural etiquette compared to people meeting in a business setting who are worried about a virtual world context not feeling as professional. Over time, as virtual worlds become pervasive in our social lives they will become more natural places to chat with people about business as well.

As more and more people are working online and interacting virtually, a big question is how you get beyond Zoom calls or the technology that’s currently in the market for virtual conferences to something that feels more like walking around and chatting with people in person. It’s tough to do without the ability to walk around a virtual space. You can’t have those unplanned small group or one-on-one interactions with people you don’t know if you’re just boxes within a Zoom call or some other broadcast. It will be interesting to see what develops around virtual business conferences that stems from virtual world technology. I’ve seen a few teams exploring this.

Last question here, but we are looking at a major recession in the economy, and so how does the landscape of people earning money from virtual worlds change with coronavirus?

The second-to-last article in my series is about the virtual economies around virtual worlds. Any virtual world inherently has commerce and people have already been making real-world money from games and from early virtual worlds like Second Life.

Both people staying home amid the coronavirus and the recession that we seem to be entering are pressures that will push more people to look online for ways to make money. That will only increase the activity of virtual economies around some of these worlds, whether those are formally built into the game or they’re happening in a gray or black market around the games (which is more common).

Thanks, Eric.

A multiverse, not the metaverse

How startups close their first big sales

Published December 17, 2019

Joe Procopio
Contributor

Joe Procopio is a multi-exit, multi-failure entrepreneur. Joe is currently building Spiffy, and previously sold Automated Insights, sold ExitEvent and built Intrepid Media.

Aggregate value to target prospects

The process starts way before the first sales pitch. Your chances of closing your first big sale are going to be directly related to how well you’re targeting your prospective customers. So let’s begin with a discussion of aggregation and targeting.

All product and service sales come down to usage and aggregated value. It doesn’t matter if your target customer is a consumer or a business. It makes no difference if your price point is dollars or thousands of dollars. It doesn’t matter if your transaction is completely frictionless or requires a six-month hand-hold by your sales team.

If your customer is a consumer, they’re going to have limited usage with your product or service and the value needs to be tightly wound into that small usage window. If your customer is a business, they’re likely going to have multiple users and almost continuous usage of the product or service, so the value will be delivered over time.

So a “lot of customers” for your product or service might be 100, or it might be a million. Either way, you’re offering the same value per dollar based on usage. You’re aggregating that value into the sale, so you need to be targeting those customer prospects with the highest expected usage.

A classic rookie mistake made by most entrepreneurs is spraying and praying at large prospect audiences for the sake of their largeness alone, hoping that those shards of value surface for the right people at the right time.

Don’t do that. Instead, for B2C sales, you’re going to need some intelligence about your prospect list, which means more than Facebook ad demographics — it’s being able to predict the usage based on the source of the prospect. For B2B sales, you need to determine the optimum type of business to sell into: their size, their industry, their appetite for innovation, and anything else you can use to narrow your focus.

Figure out who is going to get the most aggregate value for their usage and target them.

Targeting customer prospects based on value aggregation is not only going to increase the chances of closing, it’s also going to dictate the near future in terms of the growth of your startup. A targeted, good customer is going to make your life a lot easier. A random, poor customer is going to fill your world with complaints, support requests, change requests, feature requests, and ultimately severe changes to your product roadmap.

Consolidate and find a champion

When you’re a startup, your customers are buying innovation. The tricky thing is, no one needs innovation. Rather, they need the derivatives of that innovation — time, simplification, throughput, security.

In order to close a big sale, in other words, the aggregation of many, many units of that usage and value, you’re going to have to consolidate that usage and find a champion of value on the customer side.

So the question becomes: Who benefits the most from the derivatives of innovation brought about by maximizing the usage of your product or service?

MediaLab acquires messaging app Kik, expanding its app portfolio

Published October 19, 2019

Popular messaging app Kik is, indeed, “here to stay” following an acquisition by the Los Angeles-based multimedia holding company, MediaLab.

It echoes the same message from Kik’s chief executive Tim Livingston last week when he rebuffed earlier reports that the company would shut down amid an ongoing battle with the U.S. Securities and Exchange Commission. Livingston had tweeted that Kik had signed a letter-of-intent with a “great company,” but that it was “not a done deal.”

Now we know the the company: MediaLab. In a post on Kik’s blog on Friday the MediaLab said that it has “finalized an agreement” to acquire Kik Messenger.

“Kik is one of those amazing places that brings us back to those early aspirations,” the blog post read. “Whether it be a passion for an obscure manga or your favorite football team, Kik has shown an incredible ability to provide a platform for new friendships to be forged through your mobile phone.”

MediaLab is a holding company that owns several other mobile properties, including anonymous social network Whisper and mixtape app DatPiff. In acquiring Kik, the holding company is expanding its mobile app portfolio.

MediaLab said it has “some ideas” for developing Kik going forwards, including making the app faster and reducing the amount of unwanted messages and spam bots. The company said it will introduce ads “over the coming weeks” in order to “cover our expenses” of running the platform.

Buying the Kik messaging platform adds another social media weapon to the arsenal for MediaLab and its chief executive, Michael Heyward .

Heyward was an early star of the budding Los Angeles startup community with the launch of the anonymous messaging service, Whisper nearly 8 years ago. At the time, the company was one of a clutch of anonymous apps — including Secret and YikYak — that raised tens of millions of dollars to offer online iterations of the confessional journal, the burn book, and the bathroom wall (respectively).

In 2017, TechCrunch reported that Whisper underwent significant layoffs to stave off collapse and put the company on a path to profitability.

At the time Whisper had roughly 20 million monthly active users across its app and website, which the company was looking to monetize through programmatic advertising, rather than brand-sponsored campaigns that had provided some of the company’s revenue in the past. Through widgets, the company had an additional 10 million viewers of its content per-month using various widgets and a reach of around 250 million through Facebook and other social networks on which it published posts.

People familiar with the company said at the time that it was seeing gross revenues of roughly $1 million and was going to hit $12.5 million in revenue for that calendar year. By 2018 that revenue was expected to top $30 million, according to sources at the time.

Anonymous app Whisper lays off 20% of staff to survive

The flagship Whisper app let people post short bits of anonymous text and images that other folks could like or comment about. Heyward intended it to be a way for people to share more personal and intimate details — to be a social network for confessions and support rather than harassment.

The idea caught on with investors and Whisper managed to raise $61 million from investors including Sequoia, Lightspeed Venture Partners, and Shasta Ventures . Whisper’s last round was a $36 million Series C back in 2014.

Fast forward to 2018 when Secret had been shut down for three years while YikYak also went bust — selling off its engineering team to Square for around $1 million. Whisper, meanwhile, seemingly set up MediaLab as a holding company for its app and additional assets that Heyward would look to roll up. The company filed registration documents in California in June 2018.

According to the filings, Susan Stone, a partner with the investment firm Sierra Wasatch Capital, is listed as a director for the company.

Heyward did not respond to a request for comment.

Zack Whittaker contributed reporting for this article.

Nextdoor adds new funding, closes growth round at $170M with $2.1B valuation

Published September 10, 2019

Social networking platform for neighbors Nextdoor today announced it has secured additional funding to close out its $170 million growth round. The new financing includes the $123 million Nextdoor raised in May from new investor Riverwood Capital along with existing investors Benchmark, Tiger Global Management and Kleiner Perkins. The additional funding announced today comes from tech investment firm, Bond.

As a result of the new investment, Mary Meeker from will join Nextdoor’s board.

As of the May 2019 round, Nextdoor was valued at $2.1 billion for its neighborhood-level networking platform, which today generates revenue from sponsored posts and its real estate vertical for local agents. The company had said it was on track to double its revenue in 2019.

We understand the valuation remains at $2.1 billion, even with the additional funding.

Since its 2010 founding, the Nextdoor platform has grown to more than 247,000 neighborhoods across 10 countries. Its international growth potential appears to be of interest to Meeker, as does the verification process Nextdoor uses to ensure its users actually live in the neighborhoods they join.

This is not how Facebook’s Groups product works, where verification is left up to individual Group admins. That results in neighborhood groups filled with people who are just looking to research the area, those who used to live there but have since moved, businesses looking to advertise to locals, people who live nearby but don’t have a neighborhood group of their own and various other non-neighbors.

“Nextdoor has proven itself as the leader in local connectivity. Nextdoor is built on trust — verifying each members’ name, address and neighborhood — which creates the transparency and accountability that is core to building communities,” Meeker said. “Nextdoor is connecting people to the information and services that matter most, and I am excited to work with this impressive team to help expand Nextdoor’s local utility as well as it’s growing global footprint,” she added.

In recent months, Nextdoor has also grown its team, with new hires Antonio Silveira as its head of engineering; Tatyana Mamut, head of product; Bryan Power, head of people; and Craig Lisowski, head of data, information systems and trust.

“We could not be more thrilled to welcome Bond to our family of investors. Mary Meeker has been a strong supporter of Nextdoor for many years and is deeply knowledgeable about consumer technology,” stated Sarah Friar, CEO of Nextdoor, in a statement. “At Nextdoor, we believe that change starts with each of us opening our front doors and building deeper connections with the people nearest to us: our neighbors. We’re thrilled and honored to partner with all of our forward-looking investors to catalyze neighbors’ ability to connect with relevant local conversations, organizations, and businesses, engage in real-world interactions, and unlock the global power of local.”

The need-to-know takeaways from VidCon 2019

Published July 15, 2019

VidCon, the annual summit in Anaheim, CA for social media stars and their fans to meet each other drew over 75,000 attendees over last week and this past weekend. A small subset of those where entertainment and tech executives convening to share best practices and strike deals.

Of the wide range of topics discussed in the industry-only sessions and casual conversation, five trends stuck out to me as takeaways for Extra Crunch members: the prominence of TikTok, the strong presence of Chinese tech companies in general, the contemplation of deep fakes, curiosity around virtual influencers, and the widespread interest in developing consumer product startups around top content creators.

Newer platforms take center stage

Photo by Jerod Harris/Getty Images

TikTok, the Chinese social video app (owned by Bytedance) that exploded onto the US market this past year, was the biggest conversation topic. Executives and talent managers were curious to see where it will go over the next year more than they were convinced that it is changing the industry in any fundamental way.

TikTok influencers were a major presence on the stages and taking selfies with fans on the conference floor. I overheard tweens saying “there are so many TikTokers here” throughout the conference. Meanwhile, TikTok’s US GM Vanessa Pappas held a session where she argued the app’s focus on building community among people who don’t already know each other (rather than being centered on your existing friendships) is a fundamental differentiator.

Kathleen Grace, CEO of production company New Form, noted that Tik Tok’s emphasis on visuals and music instead of spoken or written word makes it distinctly democratic in convening users across countries on equal footing.

Esports was also a big presence across the conference floor with teens lined up to compete at numerous simultaneous competitions. Twitch’s Mike Aragon and Jana Werner outlined Twitch’s expansion in content verticals adjacent to gaming like anime, sports, news, and “creative content’ as the first chapter in expanding the format of interactive live-streams across all verticals. They also emphasized the diversity of revenue streams Twitch enables creators to leverage: ads, tipping, monthly patronage, Twitch Prime, and Bounty Board (which connects brands and live streamers).

Twitter bags deep learning talent behind London startup, Fabula AI

Published June 3, 2019

Twitter has just announced it has picked up London-based Fabula AI. The deep learning startup has been developing technology to try to identify online disinformation by looking at patterns in how fake stuff vs genuine news spreads online — making it an obvious fit for the rumor-riled social network.

Social media giants remain under increasing political pressure to get a handle on online disinformation to ensure that manipulative messages don’t, for example, get a free pass to fiddle with democratic processes.

Facebook, Google and Twitter told to do more to fight fake news ahead of European elections

Twitter says the acquisition of Fabula will help it build out its internal machine learning capabilities — writing that the UK startup’s “world-class team of machine learning researchers” will feed an internal research group it’s building out, led by Sandeep Pandey, its head of ML/AI engineering.

This research group will focus on “a few key strategic areas such as natural language processing, reinforcement learning, ML ethics, recommendation systems, and graph deep learning” — now with Fabula co-founder and chief scientist, Michael Bronstein, as a leading light within it.

Bronstein is chair in machine learning & pattern recognition at Imperial College, London — a position he will remain while leading graph deep learning research at Twitter.

Fabula’s chief technologist, Federico Monti — another co-founder, who began the collaboration that underpin’s the patented technology with Bronstein while at the University of Lugano, Switzerland — is also joining Twitter.

“We are really excited to join the ML research team at Twitter, and work together to grow their team and capabilities. Specifically, we are looking forward to applying our graph deep learning techniques to improving the health of the conversation across the service,” said Bronstein in a statement.

“This strategic investment in graph deep learning research, technology and talent will be a key driver as we work to help people feel safe on Twitter and help them see relevant information,” Twitter added. “Specifically, by studying and understanding the Twitter graph, comprised of the millions of Tweets, Retweets and Likes shared on Twitter every day, we will be able to improve the health of the conversation, as well as products including the timeline, recommendations, the explore tab and the onboarding experience.”

Terms of the acquisition have not been disclosed.

We covered Fabula’s technology and business plan back in February when it announced its “new class” of machine learning algorithms for detecting what it colloquially badged ‘fake news’.

Its approach to the problem of online disinformation looks at how it spreads on social networks — and therefore who is spreading it — rather than focusing on the content itself, as some other approaches do.

Fabula has patented algorithms that use the emergent field of “Geometric Deep Learning” to detect online disinformation — where the datasets in question are so large and complex that traditional machine learning techniques struggle to find purchase. Which does really sound like a patent designed with big tech in mind.

Fabula likens how ‘fake news’ spreads on social media vs real news as akin to “a very simplified model of how a disease spreads on the network”.

One advantage of the approach is it looks to be language agnostic (at least barring any cultural differences which might also impact how fake news spread).

Back in February the startup told us it was aiming to build an open, decentralised “truth-risk scoring platform” — akin to a credit referencing agency, just focused on content not cash.

It’s not clear from Twitter’s blog post whether the core technologies it will be acquiring with Fabula will now stay locked up within its internal research department — or be shared more widely, to help other platforms grappling with online disinformation challenges.

The startup had intended to offer an API for platforms and publishers later this year.

But of course building a platform is a major undertaking. And, in the meanwhile, Twitter — with its pressing need to better understand the stuff its network spreads — came calling.

A source close to the matter told us that Fabula’s founders decided that selling to Twitter instead of pushing for momentum behind a vision of a decentralized, open platform because the exit offered them more opportunity to have “real and deep impact, at scale”.

Though it is also still not certain what Twitter will end up doing with the technology it’s acquiring. And it at least remains possible that Twitter could choose to make it made open across platforms.

“That’ll be for the team to figure out with Twitter down the line,” our source added.

A spokesman for Twitter did not respond directly when we asked about its plans for the patented technology but he told us: “There’s more to come on how we will integrate Fabula’s technology where it makes sense to strengthen our systems and operations in the coming months. It will likely take us some time to be able to integrate their graph deep learning algorithms into our ML platform. We’re bringing Fabula in for the team, tech and mission, which are all aligned with our top priority: Health.”