Group Chat App Lifecycle

Shaan shares a story about why group video chat apps tend to fail, based on insights from a former competitor.

"I was building something that was getting really popular amongst teens doing group FaceTime, before iPhone let you do groups. We started to grow really fast amongst teenagers and I thought 'how has nobody thought of this before?'

I talked to somebody from a previous app that had done this before - they had raised tens of millions of dollars, had millions of users, were sponsoring concerts that teens were going to. I asked him what went wrong and he basically described our exact future:

There's a sweet spot in age where teens have friends but don't have a car. They'll come home from school, go to their room, and call their friends for 6 hours straight. Then they get a car and go to college. Their freshman year they'll use it tons with their high school friends, then they'll never use it again because they stop talking to their high school friends. In college, their friends are all around them so they don't need group FaceTime, and as adults they never need it either.

House Party ended up following this exact pattern - they sold to Fortnite as a team and technology acquisition and never saw the light of day again. When you see these apps get funded, it's because VCs see the growth charts and 6-hour sessions and think 'maybe this is the next Snapchat or TikTok' - but the retention problems are hard to solve."