A No-Frills Snapchat for the Developing World

L2 Inc
L2 Inc
Sep 19, 2016 · 3 min read

As Snapchat and Instagram woo American teenagers with elaborate features like Stories and Lenses, Peekshare is courting their Mexican and Brazilian counterparts with a simpler concept: photos that disappear.

If that sounds like Snapchat, the resemblance is deliberate. The app was conceived as a more efficient version of the popular social platform that let users share photos with all their friends at once, said Daniel Idzkowski, who started the San Francisco-based company three years ago and is now its CEO. Peekshare also adopted features that Snapchat lacked, like a localized news feed and a chat box where users could privately message friends about images they shared.

But those triumphs were short-lived. One by one, Snapchat developed the same features, cutting into the app’s points of differentiation and even more critically, its market share. A week after Snapchat launched Stories, Peekshare had lost a third of its users, according to Idzkowski.

For the same reason that it struggled in the U.S., however, the app was gaining traction in Latin America.

Data-heavy apps like Snapchat and Instagram work well in the U.S. and Canada, where most consumers are enrolled in contract plans. But in Latin America, about three in four consumers have pre-paid plans and spend as much as a fifth of their income on data. By adding so many features, Snapchat had priced itself out of those markets, Idzkowski thought.

“People in Latin America just want to send their friends a photo that disappears,” he said.

Like Peekshare, social media companies are increasingly eying opportunities in emerging markets. By 2017, India will become the country with the most Facebook users, and will continue to see the fastest user growth along with Indonesia, Mexico and the Philippines. Facebook last year launched Facebook Lite, a stripped-down version of the social network targeted at consumers in developing countries. That followed Mark Zuckerberg’s Internet.org initiative, an ambitious attempt to bring everyone in the world online.

As those efforts suggest, any app targeted at the developing world must overcome the cost of data. Nearly half of Peekshare downloads come from mCent, an app marketplace that reimburses users for data used. Eliminating that obstacle increases retention rates, according to Idzkowski. About a third of users stick with the app for at least a month — comparable, he argued, to Snapchat’s metrics before its first round of funding in 2012. Like Snapchat, the company does not disclose an absolute number of users. “It paints the wrong picture,” the CEO said.

With few other social apps making inroads in developing countries, Peekshare is banking on its early mover advantage to attract advertisers.

“Our customers aren’t on Facebook. If someone doesn’t pay them back for the data, they won’t use the app,” Idzkowski said.

Article originally published in L2 Daily by Elisabeth Rosen (@elsrosen)

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