The rise and rise of Clubhouse

Clubhouse is a new social network that everyone is talking about. While Facebook, Twitter, Instagram and TikTok are visual feeds, Clubhouse is an audio app. Clubhouse has clubs, and each club hosts regular “rooms”. A room is an area people can join to discuss topics. There are moderators in a room, a speaker panel, and listeners in the audience. It is interactive, so the audience can raise hands and can be brought up to speak. This forum provides a way to host fire side chats, and have Q&A sessions. Rooms typically last from 30 minutes to several hours. They can keep going as long as a moderator is in the room. There are a few 24 hour rooms where people from different countries and timezones run the rooms as others take off. These are typically informal rooms with no topic. People are just talking casually. Part of the appeal of Clubhouse is the Covid pandemic and people alone at home. People also say they like the low-friction of being on Clubhouse. They have to be presentable on video calls, but the audio app lets them hop in for a few minutes before they are about to step into the shower. Without the Covid lockdown, Clubhouse would have likely failed as people are in offices or in schools all day and can’t talk on their phone for hours. Some call Clubhouse the first “AirPods social network” since a lot of users are wearing Apple’s wireless earphones while using the app.

Clubhouse is also an exclusive invite-only iOS app (no Android app yet). This exclusivity adds to its allure. But the invite-only aspect is not what led to its rise. The secret of the rise of Clubhouse is the initial user base. When the app initially launched less than a year ago, it was mostly used by VCs (Venture Capitalists). They were also the early investors in the startup. Since the VCs were on it, the entrepreneurs and others in Silicon Valley wanted to be on it, so they can be in the same virtual room with VCs who are discussing the future of startups, and what the next frontier in technology could be. As the elite users (and investors) in the app had a lot of clout, they could ask certain high profile people to join the app (Elon Musk, Mark Zuckerberg, Bill Gates, Steve Ballmer, and others). The investors of Clubhouse are elite VC firms who were the investors at PayPal, Facebook, and Microsoft back in the day. So they could ask the Founders of their old portfolio companies to join. So now if you have a Clubhouse invite, you can be in the same room as Bill Gates, Elon Musk and Mark Zuckerberg. Now you can see why the invites for Clubhouse are sought after. But this is not all. The final piece is something borrowed from TikTok’s playbook. It’s the American Dream trick. People in other countries see their neighbors immigrate to America and be successful financially. So they also want to go to America. This drives immigration. TikTok took this into the social network space. When Facebook, Instagram and Twitter dominated social media, people could not fathom another social network becoming dominant. But TikTok took them on. They did this using the American Dream model. They took random Instagram users with 500 followers, and gave them a million followers on TikTok. When others on Instagram saw this, they said to themselves “I have 500 followers on Instagram too. Even I can join TikTok and get a million followers”. TikTok continued this by giving random people on Instrgram a lot more followers (hundreds of thousands, or millions). It drove immigration from Instrgram to TikTok. A brilliant strategy. This was done with algorithms. When you first sign up, there is a “Suggested follow list”. This is where the people get added. If you are in this list, people breeze through the onboarding flow in the app, and end up following you. Clubhouse stole this trick from TikTok, which added to its rise and people wanting in.

So what goes on inside Clubhouse? Clubhouse is dominated by a few communities. The Japanese community, South Asian community (lot of Korean rooms), and a few others. This again gives Clubhouse some power as it becomes a strong and dominant part of certain communities and can expand to more neighboring communities. Many of these clubs host rooms about cultural topics (like new movies), but a lot are also about Tech, Finance/Economy, and topic-less rooms. The finance rooms end up talking about Bitcoin, which is a common discussion topic on Clubhouse. There are also rooms like “Shoot your shot” where single people interact, or “Roast rooms” where people roast eachother. Some are even hosting game shows on Clubhouse like “Who wants to be a moderator?” where a moderator picks random people from the audience, asks them a question and if they answer correctly, they become a moderator. When enough people are on the stage, it turns into another topic-less discussion room. Mostly a product of Covid lockdown boredom. But a more productive area is professional networking. There are many networking rooms among Real estate investors, Government contractors, etc. that are popping up. These are typically “silent rooms” where no one is talking. People join the room, click around on profiles of others in the room, and connect on Twitter or Instagram if their profiles interest the person. Clubhouse does not have DMs (Direct Messaging), so people link their Twitter and Instagram profiles on their Clubhouse profile to talk on those platforms. It is interesting to see professional networking growing on Clubhouse, which has typically happened on LinkedIn. Clubhouse also has a large chunk of “passive listeners” who listen to rooms like a podcast. A famous NPR podcaster Guy Raz is on the app doing interviews. But unlike a traditional podcast, he can bring up people from the audience to ask live questions, which adds to the appeal of a Clubhouse podcast over traditional recorded podcasts.

Clubhouse is a pretty basic app, so people have developed terms and behaviors around its interface. For example, moderators have a green circle with astericks next to their name. So they are called “green beans”. Applause happens by people muting and un-muting their mic rapidly, so the mute icon flashes over their profile picture. The Clubhouse employee base is pretty small. There are less than 10 people working on the app, so the app can experience issues and downtime regularly. But they raised fresh capital recently with a $1 Billion valuation so the app is ready to be a more dominant social network. However, as vaccines for Covid rollout and as people eventually start going back to offices all day, it is likely that they revert to text and image based social media like Twitter and Facebook, over being on an audio app all day. But for now, Twitter is working on a Clubhouse clone (called Twitter Spaces) and Facebook is also working on it’s version of the app.