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🚀 Instagram's Threads hits a speed bump
Plus, we encounter a star in the Puppy of the Week!
👋 Welcome back! It’s been a few weeks, thanks to our firmwide summer shutdown - we’re excited to be bringing Accelerated to you every week again. Check out the “Puppy of the Week” section for more on what we did over the break 👀
🧵 Instagram goes in on Threads. Instagram went all-in on the launch of Threads, a new Twitter-esque standalone product. While Meta often launches test apps via their New Product Experimentation division, Threads is a much more dedicated effort. Each user’s Threads number (marking when they joined) is now displayed on their IG profile, and to deactivate Threads, you have to deactivate IG as well. Plus, Meta CEO Mark Zuckerberg has been very personally active on Threads.
Threads reached 100M downloads in its first week, but external data is indicating a slowdown. More on Threads in the “What We’re Following” section below!
🤑 Twitter shares ad revenue. Some of Twitter’s most active creators got a financial boost, as the platform started sharing revenue from ads placed among replies to their tweets. Elon Musk had tweeted in June that Twitter would release a payment block totaling $5M, but the timing and process wasn’t announced - causing many shocked creators to post screenshots of payouts that arrived this week. To be eligible, creators have to be Blue subscribers with 5M+ impressions/month for the last three months.
🚴♀️ VanMoof hits a bump. E-bike startup VanMoof has halted operations and filed for payment deferment in its home country of Holland, after running out of funds. VanMoof was ordered by Dutch courts into a two month “cooling off” period, in which they will not be required to pay bills and court-appointed administrators will assess options including a bankruptcy or sale. VanMoof had raised $182M in funding, but reportedly operated at a significant loss as quality issues caused expensive repairs.
what we’re following 👀
The team at a16z (including Justine!) published an open source toolkit for building your own personal chatbot - check it out here.
Chipotle is testing the “Autocado,” a robot that can make guacamole.
Code Interpreter is now available for ChatGPT Plus users (here’s a handy guide).
Threads: let’s talk about it. It was undoubtedly one of the buzziest social app launches we’ve seen in the past few years, largely due to Meta’s massive distribution and the fact that it was positioned as a “Twitter killer.”
100M users signed up for the app in the first five days, breaking ChatGPT’s record for the fastest-growing consumer product ever. And thanks to Meta’s reach, high profile people (both celebrities and brands) were on Threads immediately - it felt like a sea of blue checks when you opened the product.
Daily downloads of Threads have fallen off significantly post-the initial launch. An estimated ~40M users joined in the first 24 hours, but this fairly quickly dropped to 3-4M per day, which is holding steady a week after launch. This alone isn’t surprising - it’s incredibly rare to “deposit” 100M users into an app. We would imagine that most users who were at all interested in Threads would join in the first few days, especially given the nudges towards Threads within Instagram itself. You’re probably not getting dozens of notifications a day anymore of friends getting on the app!
But as with any consumer product, the real question is around retention and engagement. Are people returning to Threads over time? Are Twitter users moving over, or are non-Twitter users starting to post on Threads consistently? The answer - at least for now - seems to be “not at scale.” Data from app and website tracking firms SensorTower and SimilarWeb suggests that time spent has dropped by ~50% and daily users have declined 20-25% from the peak last week. Though a huge number of users gave Threads a shot, most of them aren’t staying active on it.
Meta essentially cloned a successful product (Twitter) with huge distribution and an existing social graph - you sign up for Threads with your Instagram account, and are prompted to follow the people that you’re connected with on IG. The result is that most people don’t start with zero followers or an empty feed, a big advantage in overcoming the “cold start problem.”
So why isn’t it working? We have a few theories:
IG and Twitter’s social graphs are not the same. Are your followers on Twitter the same as your followers on Instagram? Probably not. For us, IG is where we’re connected with friends from high school and college, relatives, and random acquaintances. If they started seeing our tweets (which tend to be startup/tech oriented), they’d probably be confused. We'’d get significantly less engagement on my content than we do on Twitter, and would need to make a concerted effort to build a Threads audience there - which is a lot of work.
It’s too tied to your real identity. There’s another set of Twitter users who are unlikely to move to Threads for a different reason: their “posting” profile isn’t connected to their IRL identity, and they want to keep it that way. Twitter is fueled by anonymous memers, shitposters, fan accounts, parodies - these people don’t want their posts associated with their IG! Making a finsta is an option, but feels like unnecessary work and creates the vibe that anon accounts aren’t welcome.
IG users struggle with text posts. If it’s unlikely that Twitter’s power users switch to Threads for the reasons described above, then Meta will want to convert Instagram users who aren’t on Twitter today. Which begs the question: are there enough IG users who can create engaging text content that aren’t already using Twitter? Thus far, it’s not looking great - the posts from our IG friends on Threads are fairly bland and not compelling to a broader audience. Twitter has been around for a while, so it’s likely that if you wanted to create Twitter-style content, you would have…joined Twitter already!
We’re very curious to hear what you think about Threads - please weigh in:
Conviction - Investment Analyst / Associate (SF)
Atomic - Product Associate (SF)
Glacier - Product Manager (SF)
Kira Learning - AI Engineer (SF)
Initialized Capital - Partner (SF, NYC)
a16z - Deal Analyst / Chief of Staff, American Dynamism (NYC)
Point72 Ventures - Analyst, Deep Tech (NYC)
Lerer Hippeau - Analyst (NYC)
Redesign Health - New Ventures Associate (NYC)
MongoDB - Business Operations & Strategy Associate (NYC)
AI Fund - Senior Associate / Principal (Remote)
Kindred - Social Media Intern (Remote)
Workato - Strategic Alliances Intern (Remote)
Misfit Markets - Packaging Engineer Intern (Remote)
Harness - Community Management & Ops Intern (Mountain View)
Skydio - Product Partnerships Intern (San Mateo)
Snowflake - MBA GTM Intern (San Mateo)
Chewie Labs - Product Design Eng Intern (San Bruno)
TikTok - Monetization Intern (LA)
Delta Airlines - Ventures Intern (Atlanta)
BoldVoice - Growth Marketing Intern (NYC)
puppy of the week 🐶
We spent the first week of July at an alpaca and sheep farm in Sonoma, and had an amazing time!
The farm is home to many sweet animals who we got to interact with - including Pedro, who is a film star from his role in HBO's Holiday Harmony movie.
Follow them on Instagram at @lavenderbnbfarmco!
All views are our own. None of the above should be taken as investment advice. See this page for important information.