Founder Fireside: Clubhouse

There hello hello thanks for coming Thank you for having me uh we're taking Questions so make sure to do that while We talk but I mean I want to start with The fact that you have a history of Capturing ideas ahead of their big Moment and kind of following them Through to this rocket ship and I'm not Even talking about Clubhouse I'm talking About highlight one of your first Companies that really caught the attack Caught the attention of the public and The love of it so let's start there Um what's your what's your strategy when You spot a moment are you really good at Predicting things No I I am I really love building social Apps and so highlight highlight was kind Of crazy highlight was a location-based Social network and it helped you learn More about the people around you so You'd install the app and you'd sign up And and Um you know it would tell you put the Phone away we'll we'll let you know when Someone interesting is nearby and so as You're walking down the street it would Buzz and say your friends in that coffee Shop right there or that guy knows your Brother and Um you know story for another time but I Didn't actually realize how thematically Similar it was to clubhouse until Someone pointed it out to me on

Clubhouse it's all about people right That the people in our lives are the Most important thing in the world the People we become friends with the people We marry the people we have Conversations with the people we do Things with nothing affects our lives And our happiness more than the people Around us but it's crazy how inefficient Uh the world works today when it comes To uh figuring out who you want to spend Your time with and so highlight was Really aimed at that and I think Clubhouse is aimed at that too so For Better or For Worse I keep coming back To this same thing and Um it's just something I've been Interested in for a long time people Change their mind so often which I don't Need to tell you but I mean we saw we Saw it with the pandemic everyone's Staying at home and really when a lot of People got introduced to clubhouse was This moment where they were like yeah Like let's stay inside and get on this App and talk to our friends it felt Right had this huge viral moment and Things have changed so talk to me about Kind of when things went sideways and When people changed their mind So I think that um you know we started Working on this product in late 2019 and I think when social products take off There tends to be a lot of luck a lot of

Timing and certain reasons why certain Products took off uh when they did right So like with Twitter it was SMS you know It was all SMS based in the early days And people started to get unlimited data Plans With Facebook everyone got a mobile Phone and they had phone numbers but no One knew what anyone's phone number was On campus and so that was a big need That that it served with Instagram we Suddenly got cameras that were good Enough on our phones and and so timing Matters a lot yeah and um you know I Think when we launched Clubhouse the it Was probably fortunate that there are a Lot of people who were feeling an acute Need to connect with other people Uh but but my fundamental belief is that You know covet is temporary but remote Living is permanent we're we're entering A different world and if you look at History behavior that we do offline Tends to move online over time Right like with shopping we used to go To a mall and just hope that we could Find a shirt that we liked and now we Have Amazon and Shopify and DTC with Business meetings we used to fly to New York for a two-hour meeting and now most Of our meetings are on Zoom just a few Years later with dating 10 years ago Tinder launched yeah and there was a big Stigma around online dating Back Then

And Now 10 years later half of all Marriages are through online dating and With Clubhouse we think about friendship And socializing hanging out with friends Having great conversations like who in This room doesn't like to have a great Conversation I think we all do who Doesn't like hanging out with friends And meeting their friends I think we all Do it's harder to do that when the world Starts to go remote and so our belief is That as the world opens up a couple Things will happen one is there's going To be more of an acute need to have a Place where you can go and be among Friends and meet their friends and have Great conversations I also think that An audio product like Clubhouse is Designed to be hands-free it's designed So that you can multitask and what we've Seen is a lot more people Using Clubhouse when they're driving When they're at the gym when they're at The market when they're at work 25 of Our users use it in the shower you know So so I actually think that Um yes there are things that help Products get to escape velocity there's There's luck there's timing and and I'm Grateful for that but I think the trends That we're building towards are Permanent what did that early velocity Do when pursuing these trends like what Difference did it make to have this very

Hyped up exciting product that everyone Was talking about on Tech Twitter I mean Did that change the way you built in Those I mean it was like last year's on The early days I think last year yeah The um The the nice thing about having done This a few times before like you Mentioned is that you tend not to get Caught up in your own hype and Um you know when things are going like Gangbusters you sort of say yeah yeah But that's going to calm down when when Things are hard you say yeah yeah but But we're going to figure this out and You take a really long-term view on Things and that's what we tried to do When Rohan and I started the company in Our basements it was just two of us for Quite a long time actually when we did Our series a the whole company was two Of us I think over the next six months After we raised our series a we scaled Up to seven or eight people And our philosophy was always well let's Not raise money unless we have strong Conviction that this is going to work Until we really need it let's keep the Team small as long as we can so that we Can move faster And the the period you're talking about Was uh you know oftentimes with social Platforms they go through this initial Period where they they go through hyper

Growth and we certainly did that there There was a period of time where we're Growing 10x every month wow yeah and the Effect of that has on the system is well There are a few things that happen one Is it stresses a lot of the Infrastructure right you have to scale Really really really quickly Just to keep the service up because Everything is breaking you're getting Red error messages everywhere people try And come up on stage to talk and it Takes 10 minutes for a notification to Go out I mean we're not even localized On iOS today back then we didn't even Have language filtering so you know you Have this app where we're trying to stop People from joining but people are Figuring out how to join they're setting Up public spreadsheets and chaining Invites and it goes to the number one Spot in the whole App Store in Japan and Hong Kong and and Russia Germany and Brazil and Italy and everywhere and and You're just scrambling to keep things up And um so that's one impact you've gotta You've got to scale the team as fast as You possibly can a lot of people who Joined during that period are going to Be I'm joining just because they heard About it uh you know through some some Article or because it was getting a lot Of hype getting a lot of Buzz and so They want to check it out and they have

A really bad experience when they join Because everything is broken nothing Works for months after that you have People joining and and and the relevance Of their hallway is heard they can't Find good rooms and um you have this you Know two-month spike in sensor Tower Downloads that kind of like shapes The Narrative there you know from there on So I don't think hype is good I don't Think extreme hyper growth is good for a Company the ideal is to grow at a steady Pace Um you know the the fortunate thing is That during that period millions of People managed to make their way through Their Madness and and a lot of those People started to form the core of our Community today and and so it's um it's In infinite variety you know it's people From from it's truckers people from the Pizza industry people who are interested In physics and poetry and philosophy and Obscure sub-genres of Music people Talking about travel people people doing Sing-alongs I mean it's it's not the Tech community that you probably saw in The first few months it's kind of moved Beyond that a lot of rooms have moved Into private venues and semi-private Venues so we're fortunate for that Period but at the same time like you Can't get caught up in your own hype and And you have to just really take a

Long-term view on things so where we are Right now is we have years of cash in The bank we have the most incredible Community that I've ever uh ever had in My entire life ever been part of in my Entire life the best team I've ever Worked with in my life and we try and Just stay heads down building and and Just making it better and better every Week so I think hype's not a good thing And an experience kind of helps you Understand that and not get too caught Up in it yeah I mean I have so many Follow-ups but one one natural one is For a lot of founders Hype seems like a dream right because It's exciting everyone's talking about You I know you said you kept your head Down but I also wonder what you think Contributed to the hype because In my perspective invite only played a Role having you know Kevin Hart Elon Musk on in rooms played a role would you Do things differently looking back and Beyond to that we didn't do those things The community did those things so the Only reason it was an invite model is Because the company was two of us and we And we wanted to grow it in a measured Way because when you grow communities in A measured way Um you know things don't break as much And I think it's also important to the Experience that it grows through invites

It grows through friends if you think About the real world The real world operates around friends Of friends and and if you think about Products that take offline Behavior Online there are a lot of products out There for small groups of five friends That are kind of static and private Those are messaging apps there are a Number of great products for big admin Driven Community Management you know Discord and slack and and Facebook Groups and things like that Clubhouse is kind of in the middle it Operates around friends of friends and I Think that's how the real world operates If you think about every good social Experience that you've had it's probably Been with a handful of people that you Knew and then a handful of people that You didn't know but you kind of trusted Because they were friends with your Friends or they went to your school or They worked at your company or they went To the same bar that you went to because They lived in your neighborhood and and Clubhouse in my view is taking that Experience and and bringing that online And so we wanted to grow through an Invite model not to seem exclusive we've Always wanted to build Clubhouse for Everyone but we wanted to grow through An invite model so we could grow at a More measured pace and so that when

People came in they immediately saw Friends they immediately saw friends of Friends and and they had a great Experience and and as to you know why That generated hype I think the first Reason it generated hype Was because people really really loved That experience if you come in to you Get invited into this thing you come in And you see your friends hanging out There without you and you didn't even Realize that they were hanging out and You see other people that you know and And other people that are interested in The same stuff that you're interested in And you join in and you talk with them For hours that's a really incredible Experience you know I'm sure you've had Real world social experiences like that And so at the time we didn't have a Website we didn't have any social media Accounts we weren't in the App Store we We politely declined all press Interviews that's because we didn't want Hypas because we wanted to stay heads Down and just build we didn't know if This thing was going to scale but people Started talking about it because they're Having a really good experience on it They're spending 50 hours a week in the App and Um you know even when we started to get More interest from investors we sort of Said oh thank you we really appreciate

That we don't need money right now Because we had raised a small seed round And the company was just two of us and Internally our philosophy was always Well you know It seems like something is working here But if it continues to work we'll Continue to have more opportunities to Raise money if we get new data that Makes us think it's not going to work Then we don't want to have a bunch of Someone's money and we're not Capital Constrained so let's just stay heads Down building and so we were in our Basements like you know 12 14 18 hours a Day just working on stuff like kids Thumping on the ceiling above us Um you know and and we're in the product With people talking with them while We're building it and and they would Verbally report a bug and we would go Fix it and verbally tell them it was Fixed and it's really nice to have a Direct relationship with the community And um the hype that came came because One it was a really great experience I'm Sure the invite-only model intrigued People but that was never Our intention And all of the celebrity stuff that You're talking about that just happened People in the community hosted rooms and They brought these people on and um Forbes reported something spirals upward Right four to four or something I mean

Feel free to correct yeah live I love That Um They said that Andreessen won the round Because they got Kevin Hart in a Clubhouse room and I may be paraphrasing Lightly so tell me what happened I think That's silly okay so celebrities were Not part of your strategy not at all Absolutely not would you have rather Them not come I'm grateful so I'm grateful that people Want to use the product I think that's Great right and Clubhouse does have two Sides to it it's got a public side and a Private side you know um and think about Other social platforms I think that can Be a really healthy thing in the long Term like look at Instagram something Like 40 of accounts are public and and It's brand celebrities influencers and They want reach and branded content and Modernization and analytics and and That's great the other 60 of people Rough numbers uh go private and they Just use the app to share photos and Videos with their friends and keep up With what they're doing and they don't Care about how many followers they have They care about who followed them and Who DM them and what they said and the Things that they do there affect their Real life social interactions right You'll run into a friend and see and say

Like oh that vacation you went on looked Amazing and did you see that that he got Engaged and and it just works right I Follow some of these accounts and some Of these accounts and they complement Each other Clubhouse is similar or you Have broadcast you have celebrity rooms And things like that people that want as Many followers as they can get But I think a much bigger part of Clubhouse the core of Clubhouse is People hanging out it's it's about Friendship deepening friendships making New friends sharing ideas having great Conversations and like I was saying more And more of those rooms are happening in Private every day and um and uh when we Look at the product that's what drives The magical experience like we talk with People all the time we get stories from People all the time texts photos videos From people who met their spouse on Clubhouse who just flew across the Country to meet their 15 best friends in The world who are all Clubhouse people Rohan and I do New Year's orientation Every Wednesday where we host a live Room and we welcome all the new members And we tell them how the app works and What the buttons do and we still do that We still do that yeah and we do Town Hall every Tuesday and and Sundays I Used to be like come on I know we moved It yeah because I didn't want the team

To have to work weekends all the time Um but but like we do those rooms and People come up this guy Tariq came up a While back and he lives in the Maldives And he was just giddy he was saying that Everyone in the Maldives has now gotten On clubhouse and for the first time in His life he's meeting people from all of The other islands and they laugh and They talk and they're making friends and It's on some archipelago on the other Side of the world and we don't even know This is happening but we hear it over And over and over again from the Community when you talk to everyone the Millions of people in the community who Just love love Clubhouse run it seven Days a week the the average listener is Um they spend 75 minutes a day in the App 30 or 40 of them are talking and When you talk with them about why they Love Clubhouse it's not listening to a Live podcast it's it's the people that They've met the friends they've made the Relationships that they formed and and Deepened and so yes I think broadcast is Great and and in the long term we want To support both of those use cases but I Think the core of clubhouse's friendship And and community and people the the Challenge and the honestly interesting Part of it is how do you prioritize that And how do you make sure it's a fluid Um an evolving app for people who do

Change their mind and do Um use it in the way that you described So what's your advice to Founders who Are maybe trying to rethink the medium In which they want to build build a Company yeah Um so I I guess uh you know what I would say Is that Social products there are a few things I Would say one is they tend not to invent New behaviors they tend to take things That we are wired to do as humans that We have fundamentally shown we we enjoy Doing and they just make it dramatically Easier to do it with anyone in the world Right and this predates the internet if You think about the telephone you think About video it used to be that we liked Seeing people and talking to people you Can only talk to people who are with an Earshot you can only see things that Were line of sight then we got Technology that completely changed how The world was wired and you could have These relationships with people on the Other side of the world if you think About every social platform that has Ever emerged they don't come along very Often they tend to come along when There's a new medium that emerges on the Internet the durable ones right and um And the ones that work they tend to be Very simple there tends to be a sink a

Single core interaction that makes them Work and Um the company that is fully focused on That Medium tends to win right Historically at least like with text it Was Twitter with photos it was Instagram With videos YouTube and now Tick Tock And and we think spoken audio is going To be the same so I guess what I would Say is Um Look for look for inflection points you Know sort of why now points where where New things are happening for us it was Airpods Alexa second order things like Texas beach getting good enough machine Translation getting good enough remote Living Um look for inflection points and try to Recreate a core human behavior And recognize that you're not going to Make your product work by building in a Lot of secondary and tertiary features It's one core feature that usually makes It work and as uh you know when you're Getting started as a founder it's pretty Easy to trick yourself into thinking That you have product Market fit or you Can tweak your way into it And and I I think that usually turns out Not to be true do you think Clubhouse Has hit product Market fit I think we Have extreme product Market fit with one Community yeah and my view is that

Product Market fit is not a binary thing I think that as a company grows it needs To get product Market fit again and Again and again at each new level of Scale in order to continue its growth Trajectory take something like Facebook Facebook got product Market fit within Harvard And then it needs to do it at every College And then growth started to stall out and It asked itself should we go beyond Colleges and it was a controversial Decision at the time But they did and they managed to hit Growth again And then they they managed to grow to Their next stage through acquisition Through things like WhatsApp and Instagram and then you've seen what's Happened with their growth trajectory And you know mobile happened along the Way there too right mobile came along And Facebook tried to build on top of HTML5 and it was causing all sorts of Problems and they had to go all in and Say we are making a transition to be a Mobile company and they had to make that Platform shift and now they're working To do that again to become a metaverse Company so I think you see it with all Social platforms the single core Interaction makes them work Growth tends to be driven by a series of

Continuous optimizations that happen Over time and that's punctuated by these Discontinuities that come along every Six to 24 months right with Facebook News feed was a discontinuity with Snapchat and Instagram stories were a Discontinuity so I think that Clubhouse Has extreme product Market fit with this One Community but as communities grow They get too big and you lose the Intimacy and and you know the the Quality of your hallway will suffer and You won't be able to find the people That you want to talk with you won't be Able to have these intimate Conversations they need to be able to Undergo this sort of mitosis Right and we talk about this a lot Internally if you think about it that is The way that communities organically Grow and it happens in the real world And it happens online yeah and like Imagine you go to a house party if You're one of the first four people There you walk in and there's one group Of people talking in the living room if You get there an hour later there are Six group of people groups of people There's one in the balcony there's one In the kitchen there's one in the living Room because we split off so we can Retain that intimacy with with online Products think about the earliest days Of the internet there would be like a

Music Forum everyone who's interested in Music will go there and talk and they'd Be really excited as it got big it would Split off and you'd have the hip-hop Forum and you'd have the classical music For them and as those got too big they Would split off So I think for us To to to Really Um get the product right at this next Level of scale I think we have to allow these Communities to undergo mitosis and and To split off and and to become not just A single Community but a network of many Different communities and that's what We're really focused on right now and Um uh so so that's how I kind of think About it you have to do it at each new Level of scale I want to get to audience Questions in a minute so get them in but Before that I want to end with Competition so the huge rumor that Twitter wanted to buy Clubhouse for four Billion dollars how do we feel about That number Um uh can't comment on any conversations About anything Um I guess what I would say so Twitter Did build a competitor right Twitter Twitter spaces and that I think from It's the largest competitor it on Outside looking in it looks like it's Directly going uh for who Clubhouse is

Going for after talking today I can tell You you uh are targeting a smaller more Intimacy focused versus General network But you talk to me about Twitter spaces And how it's changed the long-term Vision for Clubhouse I think that um I Think there are a lot of companies that Have launched competitive features right And my beliefs everything they're a lot Yeah my belief is that focus is really Important like if you look at history The company that is like like these new Platforms they don't come along very Often that tends happen when there's a New medium and the winner historically Has been a company that's fully focused On that medium and and why is that right I believe the reason for that is that When I use a product the way that I use It is very much a function of that Medium if I'm using a short form text Product if I'm using a photos product I Tend to open it when I have 20 seconds To spare I have two minutes to spare I'm Walking down the hallway I'm waiting in Line for a cup of coffee I don't have Airpods in I'm not looking to Participate the set of people I'm Connected to are the people who are Really good at that medium and it Differs from medium to medium the Primary Discovery service that the app Opens to is fully dedicated to that Medium if it's on some secondary or

Tertiary screen usage numbers plummet if It's not the company's sole reason for Being they tend to de-prioritize it when When times get hard for them and we've Already seen a number of these Competitors that you're talking about De-prioritize their efforts here the the The brand the business model everything About it is fully focused on that Medium So I think that's why it's played out That way historically and I think that's How it will play out for for audio You Know spoken audio and and we'll see if I'm right but but that's what we believe The other thing I would say is that a Lot of the products that you're talking About Are very focused on broadcast uh Twitter Is a broadcast product and I think what They're building is something that is Targeting broadcast clubhouse at its Core Is about participation and conversations And and friendship and Um you know getting together with Friends friends of friends people you Respect and having these off the record Conversations and and sharing ideas and Learning and I think it's a very Different use case I think explaining to People that the I guess the difference In clubhouse's Vision today versus when They were first introduced to it is Seems like the biggest challenge ahead

But that's kind of one of the first Questions I wanted to get to it's which Is you know a lot of people there's the Headlines of the rise and fall of Clubhouser what happened to clubhouse or The hype is gone now where is it when we Talk about how competitors have changed The landscape what is kind of your Response to it or even like your final Comment on this fall this idea that Clubhouse fell I think that um we we take a really Long-term view on things right we had a Couple months of insane silly Unsustainable 10x a month growth and I Think a lot of people who say that are Probably looking at those two butts and Saying how come you can't go 10x a month In perpetuity yeah do we have now can You tell can you tell what's that how Many x a month are we going now I'm not Going to tell you that damn it Um so so I think like a lot of people Are probably looking at those two months A lot of people are either saying well My friends aren't using it or you know They came in in the months that followed That period and had a bad experience Because they looked at their hallway and It felt like a lot of noise and it was Like I was saying like those months can Really can really stress the Infrastructure I think what people might Not appreciate is that Clubhouse is kind

Of Moved into all of these different Verticals and they probably don't don't Appreciate that the size of the Community and the activity and the Diversity and the range and all the Conversations that are happening I I Think they don't understand that a lot Of these conversations are are happening In private and semi-private rooms right Now and so we just take a really Long-term view of things again I'm Fortunate that we started this company When I was 40 and instead of 20 because You gain a lot of perspective and and we Have years of cash in the bank yeah we Have a very long-term Vision I really Believe that behaviors that are offline Tend to move online yeah and I think That that again covet is temporary Remote living is permanent and and I Think the way that we the way that we Meet people and and feel a sense of Presence with our friends and meet their Friends it's it's very underdeveloped Right now and I think technology can Change that so Um that's really what we're focused on You know we're we're in the middle of This crazy journey and uh you know or I Guess I should say closer to the Beginning of it and and and I just love It you know and and we're just going to Stay heads down and we're going to keep

Building let's end with rapid fire Because 10 minutes left all right well Okay number one is how much runway do You have we have years of Runway do you Have any specifics I don't but we have a Lot of Runway okay Guys were here when I said that how do You beat the cold start problem Oh this Is a very interesting thing so Um This is this is not really really fast Though but okay okay I'll try and go Rapid fire Um so we're launching this new feature Called houses which allows any person Any group any Community to create their Own private Clubhouse it's members only They choose who's going to be there and We've been launching a bunch of them in Beta and they're really cool and um the You're seeing crazy range so the way you Start sold the solve the cold start Problem is you Empower people to build Their own communities and you ensure That when people join they all get in a Room together at the same time and have A magical experience and then you Connect them together over time I'll Take it why did it take so long to build The Android version was it intentional Do you regret that late launch Um because our company was only two People and you know when we started Growing at 10x month we were seven and

So we had to Work as fast as we could to scale the Team the reason we started with iOS is Because Rohan my co-founder knew iOS More than he knew Android and and so um In retrospect I do wish that we had Scaled the team earlier but I don't Think it's realistic to expect that we We never would have predicted that it Would grow that fast how many people are At Clubhouse today working for Clubhouse We're just a little under 100. okay well That's a lot in one year right it's a Lot yeah it's a scale one year yeah um Is there a VR solution coming for Clubhouse I think VR is really Interesting but I think it's very far Off okay And the other one that I wanted to bring Up was daily active users that's the Main question I'm not going to tell you That okay Okay I guess like your next fundinger I'll Ask you that Um how large does the domino effect have On a platform like Clubhouse both Internally and externally Um what do you mean The Dominoes I don't Know what they mean by domino in fact Actually maybe it was something you Would know I don't know Um How do you prevent Clubhouse from

Becoming a zombie platform how do you Keep it Scrappy now you're 100 people so How do we make sure it stays like it can Keep growing fast because it's always The startups that end up competing with With the bigger companies Um do you mean as a company internally Or do you mean no does that's like a Living breathing app uh how do we make Sure it stays fast when it's updating Its product yeah so we ship updates fast You know so we ship pretty meaningful Updates every week and the way we do That is to hire a really great team and To just stay heads down focused on the Most important thing so we ship really Fast and the way that you grow is Through the community like our job is to Empower people as founders of houses on Clubhouse and and as moderators of rooms To bring people together the way they Want to bring people together we firmly Believe that the world is not a Monoculture Clubhouse should not be one Either if you can focus on building the Systems that allow people to to bring People together the way they want to Bring people together and they can grow Through invites you know it's what you Said the cold start problem if you get One network to tip then you can get n Networks to tip right it scales through Product it sounds like you kind of Welcome competition in a way yeah I

Think it's great well thank you so much For your time you have to come back Thank you with all the numbers but also The updates and the launches it's such a Pleasure to talk thank you so much I Really enjoyed it thanks guys