Thread: How do you make as a social startup? 

Many hesitate to launch social companies because of monetization or because they think ads are the only way to go…founders, this post is for you 
 https://a16z.com/2020/12/07/social-strikes-back-after-ads/

2/ It's true, ads have been a fantastic way for the large social networks to make money @Facebook @twitter @Snapchat @instagram @Google. Thanks to those giants' reach and significant investment, that's made it hard for most startups to compete head-on. So what can startups do?

3/ Subscriptions, commerce, live ticketed experiences, digital goods, & tipping are some new ways to make $, pioneered in gaming. The revenue stream or combination of revenue streams you choose depends on the form factor, use cases, and users of your specific social platform.

4/ @Tinder @Spotify @venmo @bumble are some of the pioneers of these new ways to monetize in the West. Dating companies with VIP subscriptions, in-app digital currencies to boost your number of matches for example. @tiktok_us @KuaishouVideos are prominent pioneers from China.

5/ @KuaishouVideos is a Chinese short video-sharing app, but makes most of its revenue (68.5% in H1 '20) by taking a cut of virtual tips viewers send to hosts during live streams. Ads were only 28% of its revenue, along with other sources such as eComm & games (h/t @ritaliao)

6/ By comparison, Douyin (Chinese @tiktok_us ) makes two thirds of its revenue from ads, and 1/5th from tipping in live streams.

7/ No two companies are alike, and there’s a wide range of monetization options that are under-explored. I’m excited to see more startups in the West experiment with different business models and diverse revenue streams and hope this post starts the conversation.

8/ Check out Six Ways New Social Companies Will Monetize and the rest of Social Strikes Back, our series exploring the next generation of social networks and the way they’re shaping the future of consumer tech, at http://a16z.com/social-strikes-back