I find the concept of imposing artificial constraints on apps/interactions fascinating. Twitter was arguably the one to popularise the idea with its 140 character limit (perhaps by accident, the limit was initially there to support SMS) and now Snapchat (ephemeral posts). Are there any other apps that play on this theme?
Makes me wonder if there are other apps out there waiting to be "constrained". Here's some dumb ideas off the top of my head. What about a social network where you can only have 10 friends? What about an email inbox where you are limited to receiving X emails/hour (perhaps senders could bid on delivery priority?). What about a HN where you are only allowed to comment once a week? What about a continuous delivery system where you are blocked from releasing after you reach a quota of defects (I heard Google uses such a quota system internally)? What about a package repository which rejects packages with over 150 lines of code or some other quality metrics?
Sometimes I like to consider an analogy between social networks/apps and bars. Just like a bar has a certain decor or a unique beverage or some other quirk that gives it its charm, each popular social network has some different constraints that give it it's unique feel.
I definitely think this is one of the reasons Instagram is so popular, together with the low resolution. It lowers the bar for when a picture is as good as it gets which makes people more prone of posting it.
Path (https://path.com/) originally started as a social network where you could only have 150 friends
My younger girl cousin told me it's still Snapchat for her and WhatsApp is so 2013. The artificial restriction to one device bothers her (no website version).
A friend lost his WhatsApp chat conversions as someone stole his phone.
Hello LinkedIn ;)
Imagine linkedin stripped down to a singular perfect professional profile? Instead of a maze of categorizations, all vaguely similar and meaningless.
No, it isn't.[1]
In the ascent phase of the bubble, everyone but uber-bulls is proven wrong. But what matters is whether what is happening today in terms of valuations and capital raising/spending is sustainable. I believe it isn't. AirBnB or Uber or what have you may be a great business, but a great business can be a lousy investment at the wrong price.
So you may continue be right, in the sense that share prices may keep going up, but that doesn't mean investors participating at these levels--or at the quadruple levels you forecast that may indeed come to pass--are being rational.
What's happening now doesn't have to be exactly like it was in 1999, just like what happened in 1999 wasn't exactly like the Nifty Fifty stock bubble of the late 1960s.
PS I had a front-row seat in 1999, as I worked for a well-known VC firm on Sand Hill (still there, still well-known).
[1] http://papers.ssrn.com/sol3/papers.cfm?abstract_id=240371
Most of the social companies have yet to really show they can be profitable other than being bought out. Valuations are often grossly overinflated.
AirBnB and Uber are both skirting regulations and pushing risks onto their userbase. Regulations or a few continued instances of bad PR could pop their valuation bubble in an instant.
Compare companies overinflated valuations with how much they are actually being sold for or how much they're getting through IPOs.
"If this person actually knew what they were talking about, they would be investing and making a fortune, not telling me about it"
It doesn't matter how smart they are, how many awards they've won, or how successful they've been in business. If they're making a public post about it, it's because they don't really know anything. If they knew, they would keep it quiet and invest.
It's worth exactly what it's trading for at any given moment, by definition!
I'd dispute Facebook's IPO was botched if you are treating it as a real business rather than a bubble stock. With a real business you may as well sell stock for what buyers will pay and if the price subsequently fluctuates then that's what stock prices do. The idea that flotations must be underpriced so you can give the impression of price growth and get more investors later is more of a Ponzi scheme way of doing things.
[1] http://dealbook.nytimes.com/2012/07/01/facebook-not-feeling-...
EDIT: upon re-reading, sounds like this is exactly what the GP was referring to.
The average investor loses in this scenario. Back in the day, retail investors could invest in the growth of companies. These days, the companies don't IPO until they've already grown to be very large. Definitely doesn't help the wealth gap
https://www.linkedin.com/pulse/20140801044817-921366-marc-an...
I always thought that Facebook were too big to fail, like in no one would close their account because of what they've invested there (friends, pics, etc...); yet, people are leaving it at an unprecedented rate. I remember Facebook desertion not being much more than a statistic even a year ago, now it's pretty common to encounter people that don't have an account there anymore. I think that the bandwagon effect that is behind the growth of online communities is a double-edged sword; once the trend shifts to users leaving, the more they leave the more users are likely to leave later and everyone snowballs out until there is no one left. Fortunately for Facebook, many of those peers left because of WhatsApp/Instagram, so business' still in the family... for now, albeit much less profitable. Sooner than later, FB will be gone and its place will have to be filled up by something else. Snapchat has a seat reserved in the post-FB era and apparently that is worth at least $20B.
Anyway, derailing the discussion a little, I'd like to hear what you'd think if 'Core Facebook' went out of business right now (but not WhatsApp/Instagram). Would you consider it a success or a flop? Was it a profitable endeavour or not?
I imagine that one day I'd use many Facebook properties without ever encountering the news feed.
[citation needed] (Even among teens Facebook's growth has not slowed much, let alone unprecedentedly.)
Core Facebook probably would have been profitable. They declared after tax earnings of over $2bn for 2010-2013. I dare say they raised over $20bn from investors but much of that went on WhatsApp & Instagram.
In reality of course they are not going out of business right now and are worth quite a few billions.
Mind boggling.
Snapchat is at 200m users, but has doubled since August. If you think it's headed for 500m users then 10b is only a 2x premium for an unusually large pool of users in one place.
WhatsApp sold for 18b with 500m users. It was headed for 1b users so 18b is a similar 2x premium.
At first I thought the math didn't work but I guess it does. Users are king. Engaged users are directly convertible to money.
I don't see how this is a given. Monetization is no simple task, otherwise Snapchat etc... would have a fairly straightforward way of implementing it without disrupting the core business. Last I checked there is no good strategy and the in-app purchases doesn't seem to be working that well outside of games. The idea of push ads like they are doing with their snapchat self-promotion stuff is a recipe for disaster from unsolicited companies.
Slashdot formula for startups: 1. Idea. 2. ?? 3. Profit.
What I think it is: 1. Users 2. Power. 3. Profit.
Second, when Facebook bought WhatsApp, it wasn't for monetization but for taking a threat off the market. WhatsApp and Facebook compete for the time of the same users; I don't think you could ever put the actual financial value of WhatsApp at $20b; but it could very well interfere with the plans of your $100b+ business which goes after the time and networking effect of the same users.
I feel like at this point Snapchat and Facebook are playing chicken. This will end up as an acquisition deal. Snapchat could never monetize to warrant that valuation, while Facebook would pay a lot of money to, again, win the engagement of these users slipping away from its platform. There aren't too many ways Snapchat could translate its paper value into cash: only an IPO (not a chance, they're not IPO material) or an acquisition by Google, Microsoft or Facebook (others aren't big enough for placing this bet, and Apple doesn't seem to care enough about services to make such an acquisition, especially with the slightly shady element of the Snapchat concept).
So Snapchat and its investors will come together to push the value higher and higher until one of the tech giants break and buys the thing. I doubt Snapchat remain an independent entity while justifying this valuation. They are in competition with the next big thing.
Props to them for not getting acquired though, and pushing on.
Has Snapchat made a dollar?
they have just got 485M - sounds like a successful monetization to me :)
The reason that you are not getting interest on your bank account is because the banks don't want your money when they can get it from the federal reserves at cheap rates.
The federal reserves in 08 wanted consumers and business to spend money instead of keeping it in savings to spur the economy. (Let's not forget ~70% of GDP is consumer spending) Some will argue it has worked, others will argue it hasn't worked.
Snapchat is an example of an unintended consequences of very low interest rates.
It was only ever a trend. They should have sold it when they had the chance to sell to Facebook, because if the numbers are to be believed, they're not doing that well. Eventually we will see Snapchat either pivot or die.
I don't think you're the target audience (but I don't know how old you are, sorry!). Truth is, pre/young teens are all over Snapchat and Instagram, and I don't really see an end in sight.
100 Million users of a social app in US (followed by other western countries) are several times more revenue generating than the developing countries. The one metric that matters here is the Average Revenue per User (ARPU). Mobile advertising is growing in second and third world countries, but still lags behind. Not to say that users elsewhere are any less useful; Facebook has a huge focus on the Indian Market.
Apps for rental(sharing) economy, Uber et al, work more evenly everywhere, since they bring a straight cut out on the amount paid.
The segment that seems to works most at par globally has to be Ecommmerce. Amazon committed a $2Bn investment in India in 2014, as Flipkart got over 1.5Bn in funding.
- To start, Snapchat changed my communication behavior heavily. Before Snapchat people used any kind of messengers when they had a clear intent to start an interaction with another person. With Snapchat you just send something. You do not want to start a conversation, often you just share what you do right now, how you feel and very often it's so close to what you are and not some polished something you would like to be. You share emotions in forms of pics also on Instagram and Facebook but this is different since the emotions you present there are highly curated, see below for more.
- There are no 'likes' and this is wonderful. The existence of likes sets us under pressure. If we post something on Facebook and do not get a single like it's embarrassing and leads to postings which are only of outstanding nature painting a distorted picture of our life. Facebook is anything but not reflecting reality.
- Sending and selecting a few contacts is so fast and I do not know one single app which has a slicker process. This again leads to so much more honest and personal messaging. Since I target on other platform many more people I have to take care about my postings. On Snapchat I can quickly select a bunch of people and leave those out who might be bored by a single snap.
- The process of taking a picture is different than with the stock camera of a phone. You take a pic which is NOT saved—usually it's immediately saved and if you do not like it you have to go the the gallery, delete it and confirm again that you want to delete it. This is very annoying if you take selfies. Snapchat turned this around and once you find the right shot you can send and/or save it. Small thing but so convenient.
- Features like slide-in filters, painting on the pic, amazing video calling are just nice amenities but again show that Snapchat's interface is just great and miles beyond other cluttered UIs.
- One feature which I want to mention is putting text on pictures, no rocket science but again sometimes so funny and shows similarities to those meme generators.
- Finally, the ephemeral thing is not the key feature but it's the brand and the DNA of Snapchat, everybody knows that there's no privacy, people can screenshot the snaps and share it, period. But it's about being oneself and understanding that the pictures are just 'throw-away products', no shiny thing kept forever. This again leads to a very honest snaps. Snapchat is not about looking good.
I encourage everyone who doesn't 'understand' Snapchat's success to try it, it strengthens the relationship to close contacts and friends much more than other 'social app'.
