A few months after shutting down the Clubhouse-like voice social project “Juju”, Joshua, an entrepreneur, suddenly received a message from an investor asking Does he still have the beta code?
Joshua told Phoenix Technology (WeChat search: iFeng Technology) that he started the social voice direction early last year, and officially switched to the “Clubhouse model” in June. But as of the project shutdown, he has not received any round of financing. Unexpectedly, due to the fire of Clubhouse, he got the attention of investors again in a small scale.
With the same product and a very different direction, why can’t Clubhouse’s development pace be replicated in China?
Here is Joshua’s account
1
I was the first entrepreneur in China to do the “Clubhouse” model. The App we launched was called “Juju”. In fact, we started almost at the same Time as Clubhouse, and started testing the application early last year, with almost the same software features and interface.
But for a whole year, we didn’t get any investment from any domestic VCs, and no one was optimistic about us. What I heard most was that investors said they had no intention to invest in the Internet, “We don’t even look at this direction anymore”.
At that time, I basically ran away from all the famous VCs in China, but honestly, even if we don’t talk about investment, it’s hard to invite them to come over to experience and try our application, which is such a simple request.
In November last year, I was forced to shut down Here because of the delay in getting financing and the inability to support the high server cost, and I still haven’t paid off the server cost.
Two days ago, because Clubhouse suddenly burst into flames, many people suddenly came to ask me how the project was going. Even some of the capital that refused me before now started to ask me if I could give them an internal test code for the app, but the WeChat records that I had ignored after begging them to come and experience it many times before are still on it.
Sometimes I wonder if we could have held out a little longer, or if we had started 3 months later, would we have made it to this point? But it’s really too hard, and it’s burning money every day. The saddest thing for me was that after shutting down the app, some users sent me screenshots, “This product is gone, I cried for a long time”, which was really hard.
2
I like to study the communication and social field, so at the beginning, I was doing research on mobile device usage habits and found that the traditional social communication model is no longer feasible. Because the length of people’s mobile devices is no longer growing, incremental no longer, you can only go to expand the user’s use of the dimension, such as can people look at the public, but also listen to things?
For small companies, you just let the user look at the cell phone screen, in fact, are grabbing other time, we thought can not grab other time, not grabbing eyeballs? Silicon Valley investors have a more graphic analogy, calling the content that takes up users’ attention “rocks, sand and water”. The rocks are the big chunks of long-form video, the sand is short-form video, and the audio, most likely, is water.
So we decided to do voice products, I judge that the background sound similar to real-time voice will be the future, it will become a kind of infrastructure like air.
In fact, a similar product was born abroad as early as 2018, called TTYL, which is the originator of this type of voice social product, but it did not succeed later. Many people say our UI is similar to Clubhouse, but in fact we “copied” it from TTYL.
Fundamentally, our starting point is different from Clubhouse. The two founders of Clubhouse started as podcasters, so Clubhouse is an intermediate state based on podcasting and communication. Our entry point is social, and we started with friendships, which are also more private.
This has led us to set up some features differently from Clubhouse. For example, Clubhouse didn’t have “private rooms” at the beginning, and we were the first to do that.
At the beginning of 2020, we launched our first application “Here”, which is a product focusing on real-time voice socialization and is a bit more communication-oriented. The data was good, and many long-distance couples would chat on it.
But when it came to financing, it ran into some problems. Domestic investors will come up and ask you what the benchmark is, without benchmarking there is no way to make a decision, simply will not listen to you talk about the logic behind the social network. If we say we are benchmarking against a product that is almost dead in the US, TTYL, obviously we can’t raise money.
What to do? Just change it a little. At that time, I noticed that Clubhouse was very similar to Here, and at that time, they had just raised a round of funding with only 1,500 users but raised $12 million at a valuation of $100 million. We wanted to make Clubhouse a benchmark and change the social network structure to follow rather than friend.
Joshua’s message about Clubhouse shared on his WeChat account last June
In June 2020, we made another social app “Juju” based on following relationships, which is closer to the shape of Clubhouse. At that time, I didn’t realize the huge changes this change would bring to the software.
3
One of the things I felt most strongly after the change was that the cost of servers was skyrocketing. Unlike Here, which is more communication-oriented, the communication on Juju is “multi-directional”, while Here is basically a point-to-point communication between two people.
I was using the same technology as SoundNet, and the price was $0.007/minute, so if you take a room with 1,000 people and a duration of 2.5 hours, you’re paying $1,050 for the room alone.
This is terrible. At that time, I had already started my business for half a year, and had already spent almost half of the 400,000 to 500,000 seed round financing, leaving me with only 200,000 yuan.
I didn’t dare to let go (register) at all, but only did internal testing on TestFlight, using the invitation system. At the best, we had about 2,000 users, the average daily usage time of a user was 224 minutes, the retention of active users was 70% to 80%, the average number of product launches was more than 13 times per day, and 55% of users invited at least one new user.
The numbers sound great, and that means the cost is going up. From a capital perspective, this app is basically a non-starter. Because every time you add a user, you’re paying for another person. This is the biggest difference with traditional social software – real-time voice is too costly.
I have not done promotion, maintaining the 2000 people is hard enough. Our team of 5 was crammed into a shared office space in Shanghai. In order to save money, we only had one card, and the remaining four of us were all “stealing” from the space. During that year, I never paid myself a salary, and I didn’t pay any insurance, so I just priced my meals at 20 a day and lived in the most dilapidated house in Shanghai, and then put the money I saved back into the project.
We turned midway through the venture, investors will also have doubts when they see you. At that time, I am not sure if there are 50 investment institutions, but there are certainly dozens of them, few people said to invest 2 million to try. Last year, the track of mobile Internet is not popular, medical, consumer, Education are more hot track, many investors said to me, this year they do not look at the Internet.
There are also investment institutions have expressed the intention to invest, but that money is actually no way to support us to go to the next round. At that time, I calculated that the cost of supporting 2000 users was already so big, and if the subsequent users started to explode, the money would not be enough.
Later, I also reflected on why the same model, Clubhouse can do successfully? Later, I went to experience Clubhouse, and what I perceived most was the high quality of users on Clubhouse and its community atmosphere, which we had never achieved before.
4
In December last year, I decided to discontinue my business.
The shutdown is a gradual process, we actually shut down several times in the middle, sometimes shut down, some old users are not satisfied, say try again, then try again, and then go to borrow some money or something.
You say how bad my own Life, in fact, nothing, the most difficult is an employee said his wife is pregnant, want to pay a month’s salary to his wife to buy something. Then said forget it, it can not be helped.
At that time we had not issued a salary for two months, the team was also disbanded, leaving me alone at Home to support the operation of the entire software. To tell you the truth, the money we owe to the sound network has not been settled by now.
I sent a farewell to the old users on Here.
After shutting down Here, I basically just “stayed at home” and looked at the direction. A few days ago, Clubhouse suddenly became popular in China because of Musk, and suddenly many people came to me and asked me how it was doing. Are we going to continue?
It was then that I noticed that Clubhouse had become a huge success.
My first reaction was that it must be unpleasant, you feel that no matter how you talk about it, why is it like that? Right? Maybe you could have held out a little bit longer, or taken out a loan or something, or maybe you could have held out a little bit longer?
I can hardly say that VCs are to blame. If I had been put in that time, I wouldn’t have dared to invest in such a project that burned money and had no prospects.
Clubhouse is actually a very Silicon Valley project, and when A16Z invested $100 million in them, Clubhouse only had 1,500 users, which is definitely not worth $100 million. You’ll see that A16Z’s involvement has changed the whole community ecology of Clubhouse.
In the early days, Clubhouse was like us, just a few friends of the founders chatting on it, but after A16Z’s investment, the entire user base changed.
Andrew Chen didn’t simply give a sum of money when he invested, but really spent eight or nine hours a day on it. This is the same as saying that we let Shen Nanpeng come up and sit there every day and communicate with you, and slowly people came up, and his friends and CEOs of portfolio companies also came. This is different from the domestic investment logic.
Two days ago, I spent 3 days re-writing the “JUJU” again, and I deleted the previous database in a fit of anger.
Some people say that this product looks like Clubhouse, but in fact, it looks like this, and the UI hasn’t been changed. I just thought that if Clubhouse was no longer available in China, I would have a place to communicate with some friends and use it as my own backyard.
There is no room for regret. It is a passive behavior, not that I do not want to do or I do not recognize it, I still think it is a particularly good direction, its core is not we have the soil to support this thing.
(Intern Huang Xiaoyi also contributed to this article)
Recent Comments