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🔑 Newsletter #33 - How to build online communities?
+Future of Consumer Startups
Hey there! Welcome to my email newsletter. My name is Leo Luo, a student entrepreneur at the University of Michigan. I write about founder stories, trends, fundraising, and unique behaviors in the consumer startup space.
All my previous posts can be found here.
Follow me on Twitter @_leoluo.
🍽 Today’s menu
Startup story - Geneva Chat (Slack for private communities)
Future of Consumer Startups - help me to decide which verticals to focus on
What I’ve been reading - 6 articles about startups and investing
Who’s ballin’ this week - 6 new fundraising/developments in B2C space
Jobs - 12 full-time jobs and internship postings
Feedback - help me to deliver better content to you
🔥 Startup Story
How to build online communities?
(Image credit: Geneva)
Lately, I have seen an increasing number of entrepreneurs adopt a community-first approach to company building. They first develop a community within a niche vertical and then build products and services around it. For example, my friends Akshaya and Andrew at Ladder created a Slack group called ‘Remote Students’ for college students to support each other when colleges transitioned to remote learning and subsequently built a professional social network for college students.
Admittedly, it is incredibly challenging to foster an engaging community. Without proper moderations and a welcoming culture, a community can either die quickly or become toxic. Geneva is one of my favorite startups working to tackle this problem. It created a community group chat product to empower community leaders to build private communities that foster meaningful connections. I had the chance to speak with the CEO, Justin, and the Head of Community, Kim, to learn more about their journey building Geneva and their vision for the future of community building.
Similarly to other founders I have spoken to, such as David from Hyprr, Justin identified that the root cause for the polarization on social media is the ads-based business model, which leads to incentives within the product team to create features that sell ads effectively (e.g. retweets and likes) instead of bringing people together. At the same time, he witnessed a number of people move their communities from public spaces like Twitter and Facebook to private ones like Telegram, Discord, and GroupMe.
“We said ‘wait a minute, no one has really built the perfect community group chat product’. We realized that communities need a tool to bring their people together and the business model that best serves them is not one around data hoarding or ads, but rather one around transactions, because communities need all sorts of transaction types to thrive.
Some of them need to charge people for access into their community. Others might want to charge for content. Some might want to sell products or facilitate transactions. There might be peer to peer exchanges. We feel that a transaction-based business model much better aligns the incentives of our team with our users’, ” Justin elaborated.
🚗 Product Journey
Justin and his team had a really clear vision about the UI/UX of the product in the very early days and believed that IRC (internet relay chat) provides the most efficient framework and UI for building a group chat platform.
1. Thought process behind using IRC
“IRC is this OG messaging architecture for groups. Both Slack and Discord used it. We thought - ‘wait a minute, you have this messaging architecture that has been around since the 80s. It’s worked really well for older people in the context of workplace organization. It's worked really well for the context of young gamers, and on both Slack and Discord, there seems to be a new crop of users who just want to use it for community and group chat.
Why is that? Well, maybe just having channel-based [we call it room-based dissemination of content] is much more organized and efficient, much more fun than having everything flow in a single thread, like an iMessage or WhatsApp. IRC is the skeleton for our UI. The design allows us to create an ecosystem to build other communication and connection styles on top, ” Justin explained.
(example of an old IRC chat interface)
2. MVP approach is not the way to build Geneva
“We're not building this traditional consumer tech and we haven't followed the traditional iterative MVP product development cycle. We said early on - ‘here's what we want to build over the next five years and we've just been building it as fast as we possibly can. We’re not building a toy, right, we're building a utility.
I think what the world needs is genuine connection. If you want to create a genuine connection, I think you need to think about the product more as a public service than an entertainment company. Because it is a public service, the features are much more utilitarian which means they're much more definable earlier on, “ Justin said.
How they built Geneva:
Justin described building Geneva as building a house. In the early days, they aimed to focus on the foundation, which meant:
Designing the backend to scale out of the gate
Building the front-end to give their communities the foundational communication layers they would need to facilitate genuine conversations.
They started with the synchronous chat feature, then built asynchronous chat, and expanded to other mediums like audio and video. Moving forward, the goal is to keep building more features to give users everything they want.
👥 Interesting use cases
Geneva has seen many different groups using the platform from frats and sororities to various affinity groups.
“We're seeing a lot of support groups. I spoke yesterday to a group that is focused on group therapy and we have a bunch of communities who are really centered around a specific topic that matters for them such as a menstrual activism group. There's a lot of community and support spaces that are popping up. I think what's amazing about that for us is that people want to have those spaces on the internet where they can have real conversations with people who are interested in the things that they're interested in, and we're seeing that in so many different ways,” Kim elaborated.
🎢 Challenges along the way
1. Finding good people
“It was really important for us to keep the team really small so that we could foster strong interpersonal relationships, enable upward mobility, and give people a sense of stakeholder-ship. Still, it's really hard to find amazing people. It took me two and a half years to get Kim but now we're the beneficiaries of having an amazing community leader,” Justin said.
2. Help community leaders to understand how to scale
“Some communities have scaled much faster than we thought they would. When that happens, it's really hard to form a genuine community and foster meaningful relationships. We learned both in terms of what features we could build to help maintain the meaningful connection at scale and also, on the community side, what materials, we could give homeowners to help them understand how and when to scale and how to scale without losing that sense of intimacy.
For example, we think about it in a few different ways. One is, ‘how do we continue to facilitate the efficiency of separating conversations as their appropriate buckets and not overwhelm any individual?’. The other is, ‘how do we create a really robust administrative section for people to understand the rules of the home’, Justin explained.
🤔 Geneva’s unique Northstar Metrics
Justin has an unconventional way of thinking about Northstar metrics. In fact, Geneva uses an internal metric called the happiness score and cares more about how many users say ‘I am making friends on Geneva’ and ‘Geneva makes me feel a bit happier’ than conventional Northstars like retention.
“I think when you have a Northstar metric that's associated with something like engagement or retention, you're being short-sighted. I think the true value comes from something that transcends a fixed data point. Luckily, we have investors that believe in that. Obviously, we need the growth we've achieved to date and that's what excites everybody, but there's this higher-level mission that at least we orient ourselves to. We generally think the numbers have always followed suit, so as long as we remain focused on the stuff that really matters.”
💡 Advice for other founders
1. Team is everything
“I think the value of Geneva is equal to the people in the organization. There is a Bill Walsh quote - ‘if you do the work, the score will take care of itself’. That’s the same for businesses. If you assemble the right team and build the right machine internally, the machine will produce a great product”
2. Strong convictions loosely held
“I think it's important to have a point of view but also be humble enough to ask for feedback, listen to people, and excitedly change your point of view when presented with better alternative information because you're not really wedded to your point of view, you're just trying to figure out what the right answer is.”
Check out Geneva!
Feel free to reach out to me if you are an early-stage founder that is currently fundraising right now.
I would love to help and pass on the deck to investors in my network!
🚀 Future of Consumer Startups
Starting in 2021, I will have a more thematic approach to my newsletter. Each month, I will focus on a specific consumer trend/vertical and feature founders and investors within that niche. Please fill out this form to help me decide which ones to start with.
👨💻 What I’ve been reading
OnlyFans Is a Billion-Dollar Media Giant Hiding in Plain Sight
The Stickiest, Most Addictive, Most Engaging, and Fastest-Growing Social Apps—and How to Measure Them (a16z)
Meet me in the metaverse (a16z)
The state of sound in 2020 and beyond
How I got into YC twice, with 2 different ideas, in back-to-back years
🏀 Who’s ballin this week
Career Karma raised $10 Million Series A to help workers acquire in-demand trades
Twitter acquires the screen sharing social app Squad
WoodSpoon dips into $2M Seed for hand-crafted food marketplace
Sequoia-backed Sunday Tends DIY Lawn Care Business With $19M Series B
LeafLink raises $40M from Founders Fund, others to cultivate its cannabis wholesale market
Stuf raises $1.8M to rethink self-storage
😍 Jobs & Internships
Apply - Atomic Labs - Launcher (Bay Area)
Apply - Tusk Venture Partners - Investor (NYC)
Apply - Chums - Product Designer (Remote + NYC)
Apply - Rec Room - Software Engineer (Seattle)
Apply - Chisos Capital - VC Analyst (LA)
Apply - Atomic - Product & Money Ops (SF)
Apply - Saturn - Growth Ops Intern (NYC)
Apply - BCG Digital Ventures - MBA Venture Architect Intern (NYC)
Apply - First Round Capital - Community Intern (Remote)
Apply - DoorDash - Software Engineering Intern (Bay Area)
Apply - Mailchimp - Product Marketing Intern (NYC)
Apply - AmFam Insurance - VC Intern (Remote)
If you have reached this far, could you please take 30 seconds to fill out this quick survey? It will help me to improve the newsletter and deliver you more interesting content in the future. Means a lot to me ♥️.
**P.S. I have adopted many of your suggestions in the past (e.g. having more bullet points, changing the order of the content, creating an archive for all previous posts, etc) so I hear you!
↺ What you might’ve missed in the last three weeks
12/06 - Story of Wellnest (joyful journaling app) + Matthew Hartman (Partner at Betaworks Ventures)
11/29- Story of Carewell (e-commerce platform for caregivers) + Elizabeth Edwards(Partner at H Venture Partners)
11/22 - Story of Motion (Superhuman for web browser) + David Goldberg (Partner at Alpaca VC)
Check out all the startups and investors I have featured in the past on
this Notion board