trending 📈

🛍️ Shopify conducts layoffs. E-commerce platform Shopify laid off 10% of its employee base, totaling ~1,000 people. CEO Tobi Lutke said in a memo to staff that he had over-estimated where e-commerce penetration was headed due to COVID, anticipating a permanent “leap ahead by 5 or even ten years” that caused the company to over-hire. In reality, adoption has returned to the pre-COVID trend line.

🤑 Snapchat+ has strong start. One month ago, Snap launched Snapchat+ - a paid subscription to access features like seeing who rewatched a Story and “pinning” a BFF in your chats. Early data now suggests that Snapchat+ brought in $5M in revenue in its first month. We’re not sure exactly how many people subscribed (a monthly subscription is $3.99/mo, but there are also six and 12-month plans), but it’s an interesting data point for social apps studying the viability of paid subscriptions. Twitter, which just raised the price of its own subscription, is likely watching closely 👀

📊 Tech earnings continue. This week’s news on the earnings front:

• Meta saw its first ever revenue decline as a public company, down 1% YoY for Q2 2022. CEO Mark Zuckerberg said that the economic downturn’s impact on ad spend “seems worse” than it did in Q1, and forecast a weak Q3 as well. Meta has also seen a decline in e-comm ads from the “peak pandemic” period.

• Amazon beat topline estimates for the quarter, with revenue climbing 7% YoY. AWS and the company advertising business performed ahead of expectations. The company took a $3.9B loss on their investment in EV maker Rivian, and saw online store sales fall 4% YoY (we’re sensing a theme….🤔).

• Apple also beat both sales and profit expectations, but still saw relatively muted growth of 2%. The company hit an all-time high in installed base across all product categories, aided by programs that make it easier to consumers to purchase their products (e.g. installment plans, trade-in programs).

what we’re following 👀

Announcing a16z’s seed and Series A investment in Nash!

Twitter explains why you’ve seen so many (random) viral posts recently.

Hunter Walk on pitch deck mistakes that are red flags to investors.

My take on Glossier products being spotted at TJ Maxx.

chrissy teigen @chrissyteigen

@mosseri I guess for me it’s not just that I suck at making videos. It’s that I don’t see my actual friend’s posts and they don’t see mine, and I see the same people over and over and over then the feed goes “you’re all caught up!”

5:26 PM ∙ Jul 26, 2022

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The other shoe finally dropped with Instagram this week. After months of complaints from users about how the app is starting to look like a TikTok clone, Head of Instagram Adam Mosseri posted a video addressing the situation. He also responded to questions and comments - some of which came from high profile users 👀

Here’s the core of the issue: many users believe that Instagram now excessively prioritizes content from people you don’t know & videos - particularly Reels (the app’s TikTok competitor). As a result, they no longer see photos from their friends in their feed, which is frustrating if that’s the main reason they’re using the app. It’s also a bad experience when you post, because your content gets less engagement.

@courteeepaigew/e that app feels dusty anyways

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The obvious question is why Instagram would continue evolving towards a more TikTok-esque product when so many users (including Kylie Jenner) are asking for the “old Instagram” back? IMO, there’s two potential explanations:

1. Proactive - the IG team has strong conviction that the future of social media is short-form video, delivered algorithmically. There will be growing pains as users mourn the old app, but Instagram is willing to “burn the boats” and essentially torch the existing product (sharing photos w/ friends) to get there.

2. Reactive - IG is moving towards this new iteration because the old product has stopped working. Growth, engagement, and retention metrics started to flatline or decline, and the team is trying to copy features from other apps that are working (TikTok, maybe even BeReal) in an attempt to revive it.

We’re leaning towards #2 as the more likely explanation. If the core IG product was still seeing strong growth and engagement, why make such a drastic move away from it? Adam Mosseri seemed to confirm this - he essentially told users that most of them no longer have enough content from friends to fill their feed, which is why they’re seeing so much “random” content. And he noted that while users may say they want the old IG back, their actions on the app don’t align with this.

Adam Mosseri @mosseri

One thing I hear a lot is people asking to see more friend content in Feed. I'd love for there to be more friend content in feed, but all the growth in photos and videos from friends has been in stories and in DMs.

6:38 PM ∙ Jul 26, 2022

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So how did we get to a place where users aren’t posting on IG enough? One theory is that Instagram adding algorithmically-served content (photos and videos from users you aren’t friends with) essentially “poisoned” the Feed. Making the Feed more crowded made it harder to see your friends’ content. As a result, your friends got less engagement on their posts, and may have stopped posting as frequently - which forced Instagram to rely on more algorithmic content to fill your Feed.

A competing theory is that Instagram is simply going out of style - and this would have happened with or without the algorithm. Social apps are driven by trends and FOMO, and it’s hard to stay on top forever. Remember when Facebook was the cool app that everyone was using? It may be time in the social media lifecycle for another app to take Instagram’s crown (and if that is the case, it’s been an amazing run).

But this is a story that’s very much still being written. On Thursday, the company announced that it’s phasing out a new version of the app being tested with some users that featured full-screen photos and videos on a scrollable screen (sound familiar?). In addition, Instagram will be reducing the number of “recommended” posts in users’ feeds and work to improve its algorithms.

🚨 Special job alert! Unlisted, a new real estate tech startup backed by top VC funds, is hiring a founding growth lead. Learn more and apply here!

jobs 🎓

Contrary Capital - Software Engineer (Remote)

Amazon Industrial Innovation Fund - Venture Investor* (Seattle)

Google - Corp Dev Analyst (SF)

Block (fka Square) - Finance & Strategy Analyst (SF)

Citi Ventures - SVP / Junior Principal* (SF)

Techstars - Founder Ops Associate (Boulder)

BlackRock - Analyst / Associate, Decarbonization Partners (NYC)

Bloomberg Beta - Associate (NYC)

Morning Brew - Associate Product Manager (NYC)

Embark Veterinary - Associate Product Manager (Boston)

*Expects 3+ years of experience.

internships 📝

Origin - BD Intern (Remote)

TraceUp - Product Marketing Intern (Remote)

Sunnyside - Marketing Intern (Remote)

Nymble - BD Intern (San Mateo)

Patio - UCLA Growth & Community Intern (LA)

LogRocket - Content Marketing Intern (Remote)

HelloFresh - New Ventures Intern (NYC)

puppy of the week 🐶

Meet Elli, a Cocker Spaniel who lives in Finland.

Elli enjoys traveling around Europe, playing in flowers, and showing off her fancy harnesses.

Follow her on Instagram @cocker.elli!

All views are our own. None of the above should be taken as investment advice. See this page for important information.