Deep Dive: Did FOMO drive the explosive growth of Clubhouse?
It’s an exciting time for marketers because we are witnessing the explosive growth of Clubhouse, a B2C social media/audio app.
I personally did not and could not download the app because I’m still supporting Google with the android Pixel phone. I do not own an iPad but other than that, I personally do not want to endorse the idea of elitism which encourages exclusive communities (be inclusive!). However, I think that it is worth understanding how the COVID situation accelerates the interests of virtual networking and how different growth tactics drive the app downloads and engagements effectively.
Clubhouse user statistics
Clubhouse currently has 6 million registered users as of February 1st, according to the tech writer Vajresh Balaji (Medium post).
The beta version was launched in March and on May 2020, it had 1,500 registered users. By December 2020, it had 600,000 registered users, and quickly grew to 2 million in January 2021 and 6 million in February 2021.
According to Google Search Trends, searches for “clubhouse” have increased by 99x over the last 6 months and are up 3,250% over the last 90 days.
It got me curious,
- Who were the first batch of users in May?
- What happened in 2020 December that accelerated the growth?
- How did the growth sustain (at least 3x) in 2021?
Founders and lead investor background
As a former startup founder, I understand well that “founder-market-fit” (read more here) does give an unfair edge that sets founders apart from their competitors. Clubhouse was created by Paul Davison, a serial entrepreneur, who sold Highlight to Pinterest in 2016 and he met Clubhouse co-founder and former Google engineer, Rohan Seth, in April 2020. Immediately after the app was created in March 2020, they already had 1,500 beta users in April.
Despite the fact that Clubhouse did not have any press release and an official website in May, they were valued at $100 million after an initial round of Series A funding with a $12 million investment from Andreessen Horowitz (press release here), a US-based capital firm. (Read more here) For an app of its size and maturity, the funding size is unusual.
Clubhouse’s first batch of users
It’s safe to assume that due to the founders background, the money raised and the extensive network of a16z, helped tremendously in bringing in more influencers to early users’ delight. According to Forbes, on-boarding celebrities such as Mark Cuban and Kevin Hart as beta users, played a huge role in securing the Series A leading investment race between Andreessen Horowitz (a16z) and Benchmark.
Sheel Mohnot, the lead of 500 Startups FinTech Fund and Accelerator and founder, was one of the first 1,500 beta users. He posted this photo of him listening to a conversation on Clubhouse on May 23 2020.
Exclusive invite-only mechanism
The Silicon Valley was certainly hyped by the invite-only app which users can have direct interactions with big name influencers. The list of celebrities that are currently on Clubhouse are so impressive and among them are Oprah Winfrey, Drake, 21 Savage, Ashton Kutcher, Kanye West and of course Elon Musk.
The above tweet from Elon Musk on February 1 was influential in furthering the growth in 2021. It was recorded that Clubhouse has added at least a million registered users between January 30 and February 1 after this tweet, so we can see that, influencers play a huge role in driving users.
Influencers marketing (aka FOMO?)
Clubhouse has not placed any advertisements (correct me if I’m wrong) to drive app downloads so far. Instead, they use influencer marketing really well to unlock network effects on different social media platforms including LinkedIn, Weibo and Instagram Stories. The exclusivity of Clubhouse (users can only invite two friends to join) creates prestigiousness and is a valuable content to “show off” to our social media network. Please do not get me wrong, I have heard great feedback about Clubhouse in forming many meaningful discussions however the accessibility of the app is certainly making people feeling left out if they are not taking part in the experience.
Clubhouse is certainly cannibalizing the idea of FOMO and we see that the hashtag #Clubhouse邀请码 (Clubhouse Invite Code) is trending on Weibo, the social media platform, and even have a resell value on eBay, Craigslist and private Facebook groups for up to $125 (more here). Also, the conversations are all live and not recorded, which is the key to the app’s popularity because people who are not registered to the app would have missed the amazing discussions.
COVID fatigue
Other than the product invite-only mechanism, the current environment is the perfect breeding ground for social media apps. With social distancing, we’re all craving being out and meeting people. Clubhouse is essentially a virtual cocktail party that strikes a chord with people longing for a return to the time when people can casually engage with acquaintances.
I’ve recently came across with this interesting Harvard article, which explores the importance of weak ties, like the casual conversations with the barista and work acquaintances, in building our well-being because they “end up giving us the opportunity to vent, confide, brainstorm and discuss things that we think are important”. (Read more here) Clubhouse exactly fills this gap and allows us to meet people who are not exactly strangers but people we know casually during stay-at-home and lockdown time.
Clubhouse is still growing explosively and we have yet to see how it plays out. However, if you ask me whether I’m interested in downloading the app, I’d say that I’m not interested because the platform is encouraging elitism. If and when this app becomes accessible to all, I would consider it but Clubhouse would likely face challenges maintaining a buzzing community by then.
