🚀 Poparazzi debuts in the App Store at #1!
Plus, should founders raise VC $ when still in TestFlight?
Consumer finance startup Acorns is going public via SPAC! When the company launched in 2015, it was an app that invested spare change rounded up from your purchases. Now, Acorns has expanded to a much broader range of features, including retirement accounts, debit cards, and cashback in the form of stock.
As of March 2021, the company had 4M paying users and was doing $112M in ARR. Check out the full presentation here - a few key stats:
Acorns targets the “everyday American” - 60% of their users are first-time investors, 50% are parents, and median annual household income is $50-$75k.
Since July 2020, 75% of new users sign up for a premium tier ($1, $3, or $5 per month) - compared to 40% of users in the prior three years!
LTV/CAC rose from 2.7x in 2019 to 4.5x by the second half of 2020. Acorns also improved gross margin from 71% to 78% over this time period.
Retention in the first year is 73%+ for premium users - and after the first year, the company retains 80% of paying customers over the next five years.
📱 Poparazzi hits #1 in public launch. It was a big week for TTYL, an LA-based consumer social startup. The company publicly launched Poparazzi, a photo-sharing app where you can only share pictures or GIFs you take of other people (no selfies and no editing!). The app quickly hit #1 in the App Store and drew attention from VCs - Forbes reports that the company is now closing a $15-20M round led by Benchmark at a $100M+ valuation. More here from Josh Constine on why Poparazzi is the perfect app for “hot vax summer,” and you can find us @justinem, @tillym, and @oliviamoore.
🎥 Amazon buys MGM. Amazon announced that it’s buying MGM Studios for $8.45B - the second largest acquisition in the company’s history! MGM is a media company that owns 4,000+ movies (including the James Bond franchise) and 17,000 TV shows (like Shark Tank and Survivor). These titles will bolster Amazon’s Prime Video service, which has been facing tough competition from new entrants like Disney+ and HBO Max. As a reminder, Amazon is no stranger to vertical integration - the company spent $13.7B on Whole Foods in 2017.
💼 WhatsApp sues over privacy rules. WhatsApp (owned by Facebook) filed a lawsuit against the Indian government over a new regulation that would force it to trace messages. The company argues this would violate its end-to-end encryption promise, where only the recipient can see a message. The Indian government claims WhatsApp would only have to turn over user information in cases of “very serious offenses.” The stakes are high here, as India is WhatsApp’s largest market (with 400M+ users!).
⚖️ Apple vs. Epic comes to a close. The trial between Apple and Epic Games (maker of Fortnite) ended this week. Epic believes that it should be able to operate its own app store and avoid the “Apple Tax,” while Apple argues that the security standards provided by its unified App Store is a key competitive advantage over Android. The judge said that she’ll likely take a few months to render a verdict - in the meantime, The Verge summarized some of the most interesting moments of the trial!
Instagram & hiding like counts has been the ultimate will they, won’t they story. The company has invested significant resources in testing whether removing like counts would “depressurize” the Instagram experience. They’ve run numerous beta tests over the past two years, and solicited extensive feedback.
Their conclusion? It depends! Some people loved not seeing like counts, while others hated it. So Instagram is splitting the difference - users will be able to opt in to new features that hide like counts on their posts & others’ posts. Facebook will be rolling out a similar feature (though we’re not sure anyone reading this newsletter still uses it).
Do you plan to disable your Instagram likes?
what we’re following 👀
Fadeke Adegbuyi dives into Study Web, Gen Z’s online space to obsess about grades.
Inside Adrian’s Kickback, the party that blew up on TikTok and ended in 150 arrests.
What’s included in Twitter Blue, the company’s first paid subscription at $3/month.
Vox investigates who actually wins Instagram giveaways.
If you’ve worked at a consumer startup or frequently test new apps, you’ve probably heard of TestFlight. In case you haven’t - TestFlight allows users to download and test new iOS apps that aren’t yet publicly released (you need an invite to join!).
Over the past year, we’ve noticed an increasing number of consumer companies are raising a seed or Series A while still in TestFlight mode. Dispo and Clubhouse both did this, while Poparazzi spent several months in TestFlight and raised days after its public launch. TestFlight apps often benefit from FOMO-induced hype - there’s a 10k user cap, so early adopters and VCs clamor for invites before it fills up!
While TestFlight is an incredible resource, we always caution founders not to over-index on their TestFlight data when making key decisions around product, strategy, and fundraising. Why? The limited group of beta testers typically isn’t representative of the general public, and the scramble to get into a TestFlight might distort your acquisition, engagement, and retention metrics.
We’ve highlighted five questions or concerns that investors might have about TestFlight data. Check out our full blog post here, which includes some ideas of how you can respond to these questions + what data to prepare!
To what extent is hype around early access boosting usage?
Are your users benefitting from the “big fish, little pond” effect?
Are your TestFlight users representative of your target user?
Can your users bring their friends — and if not, how will usage change when they can?
Are the social dynamics on your TestFlight scalable to a larger user base?
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puppy of the week 🐶
Meet Maggie, an eleven-month-old golden retriever who lives in Chicago.
Maggie enjoys chilling on the couch, hanging out near the water at the beach, and enjoying her status as the top puppy school graduate in her class.
Follow her on Instagram @maggieandherdads!
Hi! 👋 We’re Justine and Olivia Moore, identical twins and consumer investors. Thanks for reading Accelerated. We’d love your feedback - feel free to tweet us @venturetwins or email us at firstname.lastname@example.org.