Startup Choose Your Own Adventure: GawkBox Edition
Building a company is a bit like a “Choose your own adventure” book. The decisions we in the company make on a day to day basis determine the outcome for everyone involved. The difference being that instead of someone already knowing where the plot goes based upon the decisions that are made, we do not know. We make the best decisions we can with the information that we have that gives us the best chance of succeeding.
I have read a lot of great pieces about a company’s (or an entrepreneur’s) journey that are written in retrospect. However, retro pieces are a bit like reading a summary of a “Choose your own adventure” book; you miss a lot of what actually happened as you don’t see the outcome of every possible path. I wanted to do this differently.
Over the next few pivotal months for our company, GawkBox, I’ll be writing a series of (generally weekly — but sometimes more regularly) updates on our progress, looking at what we’re learning and what decisions we are making — all in a “Choose your own adventure — GawkBox edition” style. The only retro post you’ll see is this one: where I give some background into how GawkBox got to where it is today.
I want to open a window into some of the dynamic decisions that we have to make every hour, day or week. What are we testing with the product? What did our customers say and what data did we gather? I want your feedback! While it won’t change the calls that we have made already, constructive feedback may challenge us to think of things from a different angle for future decisions.
My goal here is to create a community of readers that can benefit from the hard lessons that we learn and connect with others going through something similar. I would also be lying if I didn’t say that another goal is to get investors excited about what we’re doing here at GawkBox. We’re a small startup with limited funds and I look at our bank balance daily wondering if we can make it on time.
Firstly, for those what do not know who we are and what we do, or are new to this blog, allow me to give a short(ish) and honest assessment of our journey to date.
GawkBox’s purpose is to create a hub for content creators on YouTube, Twitch and Mixer to bring their communities together.
We launched midway through 2017 by creating a way for communities to support content creators for free. We had identified that there a was a large problem that needed to be solved: content creators work their butts off but do not get paid enough to make their dream a reality and do it full time.
Our first product was a ‘sponsored tipping’ feature for YouTubers and live streamers on Twitch and Mixer. Viewers could support content creators by just playing mobile games. The companies that made the games would pay us for the new players and we would pay the content creators. We had created an interesting network model that connected game advertisers and content creators — pushing more users into games while providing a new source of money to content creators.
After we launched, we grew exceptionally fast for the first few months. We saw close to 250k viewers play the mobile games we had on GawkBox to support YouTubers and live streamers. We were paying out close to $100k per month in donations to support creators. This success helped us raise money from notable investors such as Madrona Venture Group and London Venture Partners, and things were looking promising.
Soon after, our growth started to stall. Ultimately while viewers had a way to support the creator, the experience was not fun enough. We found that most viewers would donate once or twice, but not much more.
We tried to solve this problem by ‘jazzing’ up the tipping experience. Taking lessons from apps such as YouNow, we thought that by creating a way for viewers to express themselves live on screen, it would make the experience more compelling and drive them to tip more.
Midway through 2018 we decided to focus on the subscription ecosystem. Twitch subscriptions drove $900M for Twitch in 2017 vs a global donations market of $123M. Our hypothesis was that viewers were more motivated to subscribe on Twitch than they were to donate, as they saw something more tangible in return (badges, access to chat). We worked to find a way to allow viewers to play our library of mobile games and get a free subscription to streamers on Twitch. Unfortunately, this did not drive viewers to engage more.
We ended 2018 in a challenging, but hopeful spot.
Over 400k viewers have played games on GawkBox to support over 17k content creators and have paid over $1M to content creators. While we struggled to retain viewers after more than a few donations, we developed an effective way to engage audiences: we observed many viewers play games and support a content creator — significantly more than will contribute to a channel in the comments or chat.
In my next post I’ll dive deeper into some of our learnings, discuss how that fits into broader social media trends around community building and develop a thesis for improving user engagement and retention on our own platform. As with any startup, we need to move fast while we have the cash and the resources to make this happen.
