Is Musical.ly the Next Snapchat?
Or are short-form UGC video startups just a passing fad?
In the midst of dark times in the music startup world, there have been a few bright lights, but last week saw one of the first supernovas since the downturn began. Musical.ly, an app that allows users to upload videos of themselves lip-syncing, dancing, or just goofing off over music, announced it is in the process of raising $100 million at a valuation of $500 million. That’s halfway to unicorn status, just for videos of kids doing backflips to Future and a dog dancing in socks to Beyonce’s “Run the World.”
So far, Musical.ly seems to be huge among teenagers, with some reporting that it has sixty million users — but is it on track to be the next Snapchat, or just another overhyped company in a crowded space? Aside from the granddaddy of UGC videos, YouTube, there’s Vine, Instagram, Flipagram (which raised its own massive round last year), Chosen.fm, Dubsmash, Shimmeo, YapMe…and the list goes on. And even as the space heats up, some players are already pivoting away from music — Chosen, for instance, has started featuring sneaker collections and cute puppy contests.
Musical.ly, which was founded in Beijing, seemingly came out of nowhere, and launched without any label deals in place. It has since secured a deal with aggregator 7 Digital and sources say other label deals are in the works, meaning that a decent size chunk of that big raise will likely head right back out the door and into the bank accounts of the labels and publishers (an email requesting to talk to Musical.ly was not returned at press time).
Even if Musical.ly hammers down deals, the question remains — are these apps here to stay? On the positive side, they’re sticky as can be — download one of them and you’re almost guaranteed to lose a few hours of your life, and maybe even be compelled to make a few videos of your own. Artists seem to like them, with Jason DeRulo partnering with Musical.ly to premiere a new single and others sharing fan content on their profiles.
These apps also play into Generation Z’s need to personalize and remix everything, even if that personalization involves a dancing dog (seriously, watch the dog video, it will make your day better). Teens want to put their own spin on things and feel a sense of ownership to the culture they consume, whether that’s by developing relationships over social media with artists or just making sure that the world knows how a certain song inspires them to dance. And once they’ve created that video, they love to share it with their peers, who can then rate or remix it, creating an endless feedback loop.
This is, quite frankly, somewhat perplexing to people in their thirties and up, at least right now. The idea that you’d create a video on a platform like Musical.ly or any of the others and share it with friends and expect them to create and share back is almost unnatural. For one, adults generally have things like jobs and families to keep them busy, and sorting through a raft of karaoke videos tends to fall towards the bottom of the to-do list. I spent time on the app and learned how to make a video — it wasn’t complicated, but even with decent user design it still felt forced to me. As much as I write and think and speak about digital music and technology, I’m not a native to this format — it’s almost like learning a second language. You can learn and study and live abroad and get really good at speaking your second tongue, but it’ll never flow as naturally as your first.
Then again, plenty of companies started out with a focus on young users and grew from there. In the early days Facebook was populated by college kids; now it’s so normalized that my eighty year old great aunt sends me photos and messages a few times a week. Twitter started off with tech and media workers sharing their thoughts, and now any lunatic with an egg avatar can threaten to kill you for disagreeing with him.
This might ultimately be what makes or breaks Musical.ly and its counterparts. Despite that big initial number, it will have to scale, especially with its massive investments — and there just aren’t enough teenagers in the world to do that. If they want to really be a unicorn, they need to get people of all ages on board, and that means potentially turning off their core fan base. As soon as your mom sends you a Musical.ly video of herself lip-syncing to Adele in the minivan, the vast majority of teenagers will delete the app and flee to the next big thing making the rounds among their peers.
If adults were able to replace the kids in terms of time and engagement, this wouldn’t matter much — but this might not be the case. Facebook and Twitter allow you to do many things and consume as little or as much as you want, where these apps demand a fairly heavy level of participation. As discussed earlier, most adults don’t have the time to spend hours choreographing and shooting a really great video because they have to do things like buy groceries and pay taxes.
That’s not say that these platforms won’t evolve in interesting ways that are more appealing to a broad audience — Snapchat, for instance, has made a lot of smart moves and now provides an outlet for sharing that a much bigger group of people can use and enjoy. If Musical.ly and its peers can grow their feature sets, they might stick around. Otherwise, they might just be a fun diversion on the way to the next big thing.
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