Is Clubhouse the next cautionary tech tale?
Issue #21
What do I have in common with Malcolm Gladwell, MC Hammer and Tiffany Haddish? Well, we're all members of the exclusive, invite-only social networking app Clubhouse. The platform is the newest darling to come out of Silicon Valley, founded by Paul Davison and Rohan Seth. It launched in early 2020 and enjoyed a meteoric rise to Unicorn Status: it's now valued at a billion dollars, and counts Elon Musk and Bill Gates among its users. And I suspect it's not going to last.
Don't get me wrong—I really want to like the app. I'm excited when a new social network gains traction because the space is notoriously dominated by Big Tech platforms. And on the face of it, Clubhouse seemed like the exact platform I should like: I'm a tech founder and I would consider myself an enthusiastic early adopter of new technologies. I was excited to "get in early" on Clubhouse and see if I could make new connections, grow my platform and learn from industry heavyweights. But even I can't buy into the hype, and I'm not the only one either. A viral Twitter thread from entrepreneur Shaan Puri does a great job of laying out why the app might just be a flash in the pan.
Clubhouse downloads peaked early and then fell off precipitously. Retention hasn't been great. Puri notes that Clubhouse has a "content problem," in that everything is live. That means that if they want to have the kind of awesome content that keeps people engaged, they need an absolute ton of top-notch talks happening at all times. Not an easy goal, especially since intriguing hosts and speakers like Elon Musk aren't speaking every day. And, there's not a whole lot of incentive for content creators with big audiences to switch platforms when a podcast or YouTube video might reach 200,000 people and a Clubhouse talk maxes out at 5,000.
Another thing that would make me nervous if I was running Clubhouse? The fact that many people learn about Clubhouse rooms because someone shares about them on Twitter—and Twitter is testing their own live audio feature that could render Clubhouse obsolete. Taking all this into consideration, I just can't shake the feeling that the Clubhouse bubble might burst. It seems like early growth was artificially buoyed by the oldest psychological trick in the book: FOMO. The fact that you had to be invited to an exclusive platform where you might find yourself chitchatting with Bill Gates was a powerful growth driver, but the product itself didn't follow through.
When it comes to growth strategies, gimmicky hacks abound. But at the end of the day, if you're not giving your users something truly useful, all the growth in the world won't translate into a sustainable business. This is something I think about a lot for Kinzoo. We believe that, first and foremost, we need to solve a problem for our users, and our growth strategy heavily relies on the product itself doing that. Obviously, we dedicate time and resources to growing our user base, but we want to build an inclusive community of like-minded people—not an exclusive one fueled by FOMO.
Now that Clubhouse earned its Unicorn valuation and raised huge amounts of capital, it will be under intense pressure to keep growing. The stakes are high and the company now has lots of investors to answer to. It'll be interesting to see how it all plays out for them—and for their users.
A deeper dive
Here are a few helpful resources in case you want to really dig into today's topic:
There's always a danger in the tech world that your app or platform could be copied by another company. If you create something cool and the industry titans want to build their own version, they will. I know that Kinzoo, for example, could never compete feature-for-feature with Facebook Messenger Kids, so we focus on offering parents a fundamentally different set of values that Facebook could never replicate. Clubhouse might be in a precarious position though, since Twitter is testing a feature called Spaces, and Facebook is reportedly building its own audio-only feature.
With Clubhouse's explosive growth, parents are wondering if it's safe for their kids to use. Our team did a deep dive and created this Parent's Guide to Clubhouse, which walks through the pros and cons of the platform.
TL;DR
Too long; didn't read. It shouldn't be a full-time job to keep up on industry news, so here is a mercifully quick summary of some other notable developments:
Tim Berners-Lee is the computer scientist who helped invent the internet in the 1980s. Today, more than three decades later, he's looking to children to harness the power of the internet for good. In an open letter penned with the co-founder of the World Wide Web Foundation, Berners-Lee shines a spotlight on nine youth who are using the internet for good, and says "[t]he young leaders we’re celebrating today are the web’s greatest strength and the reason we believe that, despite its challenges, the web is overwhelmingly a force for good." And I couldn't agree more.
I'm always heartened when I see others questioning the construct of "screen time," and I enjoyed this excerpt from Mitchel Resnik's book Lifelong Kindergarten: Cultivating Creativity through Projects, Passion, Peers, and Play. In it, Resnik argues that we should shift the way we're thinking about screen time and focus instead on the endlessly creative things that our kids could be doing with technology.
Okay, that's it from me until next week. If you enjoyed this newsletter, and know of another parent who would as well, please feel free to forward it along.