Clubhouse: Top or flop?

Welcome everybody to the Product Bakery and another episode with Alex and myself, Christian. Hi, Alex. Good to have you. Hi, Christian. Feels like I'm seeing you way too often lately. Yeah, we should do less recordings. But still good to see you. Thank you very much. So before we talk about the topic, just a small shout out again. Feel free to follow us on Instagram as well as LinkedIn or reach out to us via our website product-bakery.com slash episodes where you can find a summary of each episode and can also drop a comment in case you have feedback or questions. Yes, and the best thing is comments are also read by the speakers themselves. So it's also a good way to directly ask the questions to our lovely guests. Cool. Alex, you want to talk today about the topic of Clubhouse, the new social media that is right now in everyone's mind, phone, ear. How to say it? How to start it? Yeah, I was just about to say you should have mentioned at the beginning that people can also find us on Clubhouse. Boom. Yes, because probably for everyone in the US, it's not as new as here in Berlin or in Germany in general. But I think there have been very few newspapers that didn't write about Clubhouse in the last couple of days or weeks, and it's really booming. So generally, I'm seeing every day the signups of my friends flying. Yeah, it's like really crazy. There's been a lot of conversations around Clubhouse. And I think one thing that we don't want to do is to follow up on these conversations itself. But one topic that I wanted to discuss with you, Christian, and something that I found very interesting of also using the app is their way or their approach of launching this beta. And I think there is a few nuances to it. And obviously something that is very prominent is obviously also the way they use the beta list and the waiting list to get traction to the app. And I think, of course, it's something that we've seen or that we know from a lot of products. And I think especially when you talk about a social media or a social network, where you have some influencers on it, you create this FOMO, right? The fear of missing out. And you have a lot of people who go crazy just because they want to see what it all is about. It's very exclusive. And I think even the name gives you this feeling of exclusivity. Absolutely. It's closed. You need to be invited. It almost feels like Soho house where I need to get like this crazy membership in order to be able to sit at the bar. And they have a great acquisition strategy. Yeah, yeah, that's awesome. Create a demand for something that everyone is jumping on. And what I would be really curious about is since they are a startup and just get now or start at least in Europe getting a lot of traffic and traction, I was just wondering how their roadmap look like because they must be fully focused on scalability. In terms of numbers, we obviously have to say, and that's what I mentioned at the beginning, we are a little bit late to this discussion point here in Europe, because obviously, I think they had their series A where they raised like the first 12 million millions or something. I don't have the numbers in front of me. I just looked at them earlier. It was May last year. And then in December already, they had a valuation of 100 millions. And they had I think something like 600,000 users. So I think already at the beginning, they managed from this first seed round to get quite some traction. And now with 2021, it's really peaking. And especially because of their acquisition flow. Yeah, they are also attracting a lot of people. What's interesting to from your question as well, is how much is it really beta model? Because if you listen what the founders say, it's okay. We only let limited people in because we also want to slowly stress test the system. So how much is like this? Let's keep it safe. Let's play it safe. Let's see where we can go with the system versus it's only a strategy to bring people in. But I think like more interestingly to this, and this is something or this is pretty much like the one thing that I enjoyed the most when I first landed on their page is it's really an MVP. It's super, super bare bones. It's like very limited in functionality. There is really only the main functionality, which is talking in a room and other people can listen to you. And everything else is completely manual. And I think this, this shows you also on how successful you can be by having a very early product in the market. Just to name a few examples, and then I'm happy to also get your feedback on this. But for example, I was looking into what you need to do to create a club. So club would be, let's say a closed group where you can invite members. Exactly. And you can invite members and you pretty much like use that space to have a close community on Clubhouse. And the thing is, they don't even have a way to request that through the app. So you find your way through FAQs, right? So you go through the FAQs, you find create a club. And also interesting here, how do you not spend a lot of time on developing your own FAQs? They use Notion. So they literally from the app loads the Notion page, which is publicly accessible and shared. You can go through all the information. And I mean, if we think about how much time they saved compared like implementing their own systems or hiring writers, integrating executives, it's all there. And then from this FAQ page of how to create a club, you can go to the form and it's Airtable form. So you fill out that form, it lands in their Airtable database. Then it's literally a manual process of them setting up the club. And of course, it's a massive workload. And therefore, I think it's also good that they are not letting in everyone yet, because I think it would be unmanageable. But at the same time, I think I've seen so many people spending too much time on exactly like these small details before actually bringing a product to the market and testing it and starting to get like early traction and beta users. And I personally was like super impressed and really like their approach of launching the product. So happy to hear what you think, Christian. Yeah, I agree. They have definitely built a very nice MVP. But on the other hand, what I also really like is the snowball effect when it comes to the next features, because I believe the current community and people joining Clubhouse are more this kind of business people who are more of hardcore users who are also willing to use such a product, who can provide very good feedback, or who are very likely more willing to share feedback than maybe usual B2C user, to say it in quotes. So this is something that I really like, because people who are, as Niki said, in one of our podcast episodes, if you're receiving a survey, the likelihood that you fill it out is higher by people who are researchers than normal people, because researchers know the pain, right? But here's the same, right? We are having conversations, we want to use a good app that fulfills our desires and needs. And therefore, we are able and engaged to give good feedback. And I think that's something that is also really smart, because letting all this business people in, and especially I see many people coming from LinkedIn or that I know from LinkedIn. So it's also evolving like a business community, and not only business, there are much more topics. But in my environment, I see there's like a lot of people who can provide great feedback. Yeah. And I think it will automatically also help them shape their roadmap, because you see how people start using the different tools, what kind of rooms they set up, how often they set up, and so on. And from something very basic and simple, you can then like really start better target the product to the target audience needs. Yeah. I also really like the concept of the community inside the communities. Because the first step of you is that you become a part of this clubhouse community where you have access to the technology and the abilities inside. But on top of that, you have this influencers and people who are coming up with new ideas, new topics, new clubs inside, which gives you this dedicated, professional, hobby-like community and environment where you can exchange based on whatever you like and whatever you prefer. So there's two times the benefit that you get when you join a community by finding even more communities where you really can talk to people you want to. And it's something big. Yeah. And let's slow down for a second and just think also about the product that they launched. Because super honestly speaking, after Facebook, Instagram, Snapchat, TikTok, and so on, to me, it's always, okay, how many new social networks? Oh, I even forgot. Did I mention Twitter? Twitter is obviously also in there and LinkedIn as well. But after all these social networks, how many networks can you still launch? How many new ideas can you find? And I think what Clubhouse definitely did was picking up a little bit on the recent trends from last year. And you've also seen it in this podcast. One thing that we've seen and discussed a couple of times is communities and networks and the importance also of building a community in the network when building a company. So this is definitely something that they managed to leverage a lot. Yeah. And I think a lot of entrepreneurs are using it by this. At the same time, they definitely also have COVID on their sides. People spending a lot more time in their homes, people adopting a lot more to these digital conversations. A lot more of digital conversations are happening, like Zoom rooms, Zoom parties, whatsoever. You meeting your family over a video conference and so on. And therefore, giving you also a space where you can easily just have a room and allow other people to join in. And then I think the last and final thing is also this whole trend around podcasts. And we are definitely not the early podcast. There have been people doing it for a very long time. But there is also a reason why we found our way to podcasts. And it is related to this trend of people liking to listen to open conversations, this general wanting to build knowledge. And they pretty much managed to combine a lot of these things in a very natural way. And that makes a very good social media. Yeah. But also looking at where we're coming from, the whole topic of podcasting is still in its early stages. So people start getting used to it, but it's still a lot of word of mouth that's happening and people who are on day-to-day business just getting started with podcasting. If we look at the involvement that has happened over the time, if you remember back then, if you wanted to listen to people, you tuned in the radio back then. That was the only way of communicating. And at some point people realized due to technology that they can do this by themselves. And I see Clubhouse like in this next step or this transition phase where not only one or two people hosting a show can be the podcasters or the communicators to be more precise. With this Clubhouse tool, everybody's enabled to do. And I think that's really interesting to see also how the adaption will be and how the product will be used in the future. Yeah. Yeah. And at the same time, it's a little bit like, I love the idea. If I think of broadcasts and radio stations, it's usually always live. It's the Snapchat you either listen in or you miss it. Exactly. I think podcasts are more like this. The books of radio. That I can constantly look in whenever I have time and I can pause it and I can listen to it whatsoever. And I think Clubhouse is a little bit like this Instagram story or Instagram live for podcasts, right? It's like... Where the information goes at some point. Yeah. It's like when people started to instead of posting pictures, they started posting stories because it's just this moment of time. I want to capture it now. Either you look at it now or you will never see it again. And I think it feels a little bit like they're also jumping on or taking that trend into the product. I mean, I'm really curious if... Let's take the exercise. What do you think was their initial problem statement or how do you think they initially defined what they're solving for users? That's a good question. So what I would say, because if I look at Clubhouse, I have the feeling back then when you were young, when you were a kid, you just walked out, ring on the bell of your friends and then you met and you were hanging out and talking and playing games on whatever your kids did back then. And I think this is to me a similar thing. So you can just dial in a topic you are passionate about, you want to exchange on and with one click you are there and you can just start exchanging and talking to people. So it's like the digital version of hanging out together. It's not necessarily the problem statement, but that was something that I was missing. And I have the feeling that this app can give it a little bit back or it goes a little bit into this direction. So yeah, that would be my feeling around it because that's what's triggering me at the moment. But how do you think about it? Yeah, no, I think it makes a lot of sense. And I think it's also less of an obvious problem that they're solving than more of a need or that they are also creating and surfacing in people. And again, I think it's a little bit related to COVID. So like having wanting to have this natural interaction of being somewhere at a table with some friends talking, or like even more, let's say deep handle a conversation at a conference where I can listen to some professionals, but I also can directly interact by raising the hand. And you can also see the parallels between the physical and the digital world there. And so yeah, I think it's probably somewhere there. Looking at this whole topic of Clubhouse, and it could be actually a good episode title like Clubhouse top of flop. So what do you think? What will be the future of Clubhouse? And does it have a chance to become a next big social media unicorn? Seeing also how people are using it and the traction, I think I would, I see the potential for a top. And I think I do believe that they will be successful for quite some time. Which brings me a little bit also to the general question of Facebook copy it or will Facebook buy it? It's also something that we've seen a lot in the past. But I think I'm surprised that they're the first to invent it. Because to me, it makes a lot of sense. Yeah, absolutely. But you would have said we said the same to Facebook back then, right? Absolutely. Yeah, I think it's very valid point. They have good chances. And I believe that not only the fact that you can join a community, but also the fact that you can start your own community, looking at the influencers is a huge playground and a huge opportunity that you should not miss. I really like it. And I think it has a chance. And I'm not sure how you feel, Alex, but I think we should also start using it. Yeah. As product bakery. And yeah, I mean... Should we start a live talk next week? This week, let's do it this week. Let's give it a try. Let's set up a conversation. On Thursday? Let's say on the first day. Yeah, that's a good idea. First day. 7pm Berlin time. Yeah, 7pm CET. And let's see how it actually is to talk. I'm super curious because so far, I've only listened to people. Absolutely. And never was on the speaking side. So yeah, let's give it a shot. Product bakery on Clubhouse. Alex, apart from trying it out and all the positive things, I know there are also a couple of people warning of this new app and this new social media. What have you heard? And what do you think about it? Yeah, I mean, first of all, there is one point that's currently on top of media here in Europe, which is related to GDPR, right? We have some very strict laws around data. Is it data security? No, GDPR, general data processing regulations. Yes, that's the right term. And I think obviously, because of also their MVP approach, they didn't spend a lot of time on setting up their terms and conditions for the European market. So I think this is something that might backfire to them on the short term. I was sending out an invite to a friend and his first reaction was, wow, it's scary that I have to share all my contact data and my whole address book. So yeah, definitely something to watch out. Yeah. But I think this is also one of the bigger questions on how are they going to make money with Clubhouse? And I think this obviously comes with data. This obviously comes with how are they going to use all the information that they have about people, what they're listening to and whatsoever. Will there be advertisement and so on? I think also, if you look at their terms and conditions, it's open if that might come. But I think one topic that was a little bit more interesting in terms of feedback or, let's say, criticism that was raised, and I think it's the topic of inclusiveness and accessibility and also moderation in the platform. Because the way it's currently built, there is no moderation, which means whatever message you want to share with the world, you can share it. There is no fact checking whatsoever. And I think especially if we look at the political situation at the moment and so on, this is something I think that could be a yellow flag. And then at the same time, like also accessibility, right? You are excluding some people who are deaf, for example, right? Like they cannot join the conversations. At the same time, I mean, this could apply for blind people on Instagram while they fix it with, for example, having all texts and so on. But I think generally speaking, it's always good to think in a very inclusive way about products. And so here, I'm also wondering on what the idea is on how to fix it. Yeah. Fair point, Alex. So I'm really curious to see what's coming up and how they're gonna adjust their product and what kind of next features they will bring out. Alex, any more thoughts or any more things you would like to share on Clubhouse? No, I think happy to hear everyone's comments. Have you tried it? What was your experience? Other than that, I think for everyone who makes it on time, first day, 7pm CET, let's see how it is. Exactly. And if you would like to give us some feedback, we also just made today an Instagram post. So feel free to drop a comment and share your thoughts on Clubhouse. Amazing. All right. Then, Alex, thank you very much for this short interview and have a great day. Bye, everyone.