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Netflix’s ‘Hype House’ shows the dark side of the creator economy

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Netflix’s ‘Hype House’ shows the dark side of the creator economy

We used to describe celebrities like Kim Kardashian and Paris Hilton as “famous for being famous.” But the TikTok megastars featured on the Netflix docu-soap “Hype House” are famous for being ordinary. Unlike the wealthy offspring of celebrities, this class of superstars shot to stardom virtually overnight, for seemingly arbitrary reasons, all dictated by a mysterious algorithm.

“I know it sounds so dumb. You’re a 20-year-old millionaire. What do you have to be depressed about?” says Alex Warren, a TikTok star with 14.7 million followers. “But that’s what I struggle with. I feel like I’m not allowed to be depressed.”

On “Hype House,” these ordinary-teens-turned-icons agonize over the nature of their chance celebrity status, worrying that their fame will vanish as quickly as it appeared. The eponymous Hype House is one of TikTok’s longest-running content houses, where social media stars live together and film videos. This concept isn’t new — YouTube, Twitch and Vine stars have experimented with these collaborative, live-in projects for years.

Thomas Petrou (8 million followers) is the de facto manager, though he says he doesn’t take a cut of profits — he calls himself the dad of the house, but in addition to making sure everyone does their dishes, he makes sure that the Hype House brand can net at least $80,000 per month to stay afloat. His influencer friends like Vinnie Hacker (12.9 million followers), Jack Wright (8.8 million followers), Alex Warren (14.7 million followers) and others live rent-free in the $5 million mansion — all they have to do is post on the official Hype House TikTok once per month, which generates the venture revenue through ongoing branded content deals. Plus, TikTok now directly pays creators for the traffic they drive on the platform.

The Netflix series marks the end of an era for the Hype House, focusing more on the challenges that these influencers face than the antics of these young millionaires.

All things considered, the videos that these TikTokers post aren’t that different from what any average teenager would post (except that now they post from a mansion). With almost 20 million followers, the official Hype House TikTok features the stars experimenting with new filters, iterating on the latest trends and, of course, dancing.

Throughout the eight-episode series, a cloud of anxiety hovers over the scenic Santa Rosa Valley home. Some Hype House members aren’t churning out content on behalf of the group as often as Petrou wants them to, because they feel uninspired and disillusioned. In one scene, some Hype House members try to come up with content ideas while lying on giant beanbags, but the best idea they can think of is to make up a “lit-ass handshake.” They might live rent-free in a beautiful mansion, but they don’t seem to be having fun.

Meanwhile, Alex Warren is grasping at straws, staging stunts that aren’t getting as much online engagement as he wants. Even as he grapples with troubling family situations and a foot injury, he’s terrified to take a mental health break.

“When you stop posting in this line of work, you lose engagement,” Warren explains in a confessional. “You don’t get sick days in this job. If you get a sick day, you lose followers, which is a loss of revenue, which is, you know, your job.”

The influencer gold rush

TikTok stardom is becoming comprehensible as a career on the internet, as dozens of startups crop up aiming to help these suddenly famous kids navigate brand deals and partnerships (for a cut of their riches, of course). On YouTube, most early creators found profit through ad revenue, but at least in the platform’s beginning days, there wasn’t the same attention to monetization as there is now. Other platforms are also eager to capitalize on the success of TikTok and its biggest stars — Instagram, Snapchat and YouTube have spent hundreds of millions of dollars to incentivize creators to post on their platforms, rather than TikTok.

“As an influencer, our whole lives are put on this weird pedestal more so than a traditional celebrity,” Nikita Dragun (14.2 million followers) explains on the show. “You have to become a spokesperson, an activist, a model, a publicist, a manager… You have to be so many things at once.”

In most ways, the growth of creator monetization is a good thing — there are more tools than ever to help creative people make a living by doing what they love. Even LinkedIn has a team of 40 staff dedicated to working with creators. But at the same time, some creators feel pressure to monetize every aspect of their lives. Part of Warren’s following stems from his posts about his relationship with his girlfriend Kouvr Annon, also a TikTok star with 13.6 million followers — but Warren struggles to separate their private lives from the content they make, straining their (rarely) off-camera relationship.

In this era of the internet, accelerated by the growth of TikTok, it’s not just about posting videos. It’s about cobbling together as many different revenue streams as you can to make sure that if your platform died tomorrow (it’s happened before — R.I.P. Vine), you’d still have a career. After all, TikTok stars don’t make the bulk of their income from TikTok itself. The fortune comes from brand deals, sponsorships, merch sales, podcasts, reality shows and unexpected forays into music and acting.

“Hype House” emphasizes these creators’ self-awareness about their own mediocrity. They’re charismatic, funny and conventionally attractive enough to entertain the masses, but they know that their fame has more to do with luck than talent, so they worry that their good fortune can be snatched away at any second. They stress about what they would do if they had to return to their hometowns, where many of them have fractured families; they worry about being “canceled.”

“Social media is a numbers game. Your money depends on the numbers,” Warren explains. “If people stop watching as much as I’m putting out, it means I’m doing something wrong, so what am I doing wrong, and how can I get those people back?”

Warren’s anxiety isn’t unfounded — something as arbitrary as a change in TikTok’s algorithm could hamper his growth. When you’re used to explosive social media growth, how do you handle it when those numbers start to plateau, or worse, plummet?

In addition to worrying about TikTok’s algorithm, the business model of content houses is similarly unstable. Since starting the venture, the Hype House has faced a number of lawsuits, including a dispute with fellow influencer and former Hype House member Daisy Keech. In a recent YouTube video, Petrou says he’s spent hundreds of thousands of dollars on lawsuits. Though the legal issues aren’t broached on “Hype House,” Petrou describes waking up and vomiting due to the stress of running the collective. These content houses should, in theory, ease the burden on independent creators — by being part of a collective, they have a team surrounding them to workshop ideas, collaborate on videos and bring in an additional income stream from the shared accounts. But instead, “Hype House” makes it seem like relying on each other without clear financial agreements only made the stress worse.

“I don’t get the hype either”

Among the Hype House social circle is Charli D’Amelio, the most followed person on TikTok with 133 million followers — Forbes estimated that she was also the highest-paid creator on the platform, earning $17.5 million last year.

“I just like, post, as any other teenager in the world,” D’Amelio said on the reality show that Hulu made about her suddenly famous family. “I was just posting on social media… I don’t know.” As D’Amelio once joked in her TikTok bio, “don’t worry i don’t get the hype either.”

But even the creator economy’s biggest star has doubts about whether her stardom is sustainable. In the pilot of “The D’Amelio Show,” she reveals that she’s thought about what she’ll do if she doesn’t keep making millions, or if the pressure of her lifestyle becomes too much.

“Being on calls with CEOs of companies… I’m like, that’s kind of fun?” D’Amelio says. “So no matter what really happens with social media, I could always go into marketing, because I know how it works. I know the back ends of everything, which is cool.”

It’s bizarre for D’Amelio to have a backup plan when she makes more money in a year than most people will make in their lifetime (plus their children’s lifetimes, plus their grandchildren’s lifetimes… unless one of the grandchildren makes it big on TikTok). But for viewers, the entire point of shows like “Hype House” and “The D’Amelio Show” is to humanize these social media stars. For the production teams, the point is to make Netflix and Hulu money and for the stars themselves, it’s to get an extra paycheck, and help them maintain and bolster their fame… it’s all terribly meta. They leverage this semi-manufactured vulnerability to make themselves into even bigger stars.

Maybe the biggest winner here is TikTok. This has been the app’s appeal all along: Like Alex Warren, you might go from living in your car to living in a mansion, all because people like your short video clips. But it’s lonely at the top, even when you’re living with 10 of the most famous people on the internet.

Source: Tech

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Dashworks is a search engine for your company’s sprawling internal knowledge

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As a company grows, the amount of important information employees need to keep track of inevitably grows right along with it. And, as your tech stack gets more complicated, that information ends up split up across more places — buried in Slack threads, tucked into Jira tickets, pushed as files on Dropbox, etc.

Dashworks is a startup aiming to be the go-to place for all of that internal knowledge. Part landing page and part search engine, it hooks into dozens of different enterprise services and gives you one hub to find what you need.

On the landing page front, Dashworks is built to be your work laptop’s homepage. It’s got support for broadcasting company wide announcements, building out FAQs, and sharing bookmarks for the things you often need and can never find — your handbooks, your OKRs, your org charts, etc.

More impressive, though, is its cross-tool search. With backgrounds in natural language processing at companies like Facebook and Cresta, co-founders Prasad Kawthekar and Praty Sharma are building a tool that allow you to ask Dashworks questions and have them answered from the knowledge it’s gathered across all of those aforementioned Slack threads, or Jira tickets, or Dropbox files. It’ll give you a search results page of relevant files across the services you’ve hooked in — but if it thinks it knows the answer to your question, it’ll just bubble that answer right to the top of the page, Google Snippets style.

Image Credits: Dashworks

Right now Dashworks can hook into over 30 different popular services, including Airtable, Asana, Confluence, Dropbox, Gmail, Google Drive, Intercom, Jira, Notion, Slack, Salesforce, Trello, and a whole bunch more — with more on the way, prioritized by demand.

Giving another company access to all of those services and the knowledge within might be unsettling — something the Dashworks team seems quite aware of. Kawthekar tells me that their product is SOC-2 certified, that all respective data is wiped from their servers if you choose to disconnect a service, and that, for teams that are equipped to host the tool themselves, they offer a fully on-prem version.

This week Dashworks is announcing that it raised a $4M round led by Point72 ventures, backed by South Park Commons, Combine Fund, Garuda Ventures, GOAT Capital, Unpopular Ventures, and Starling Ventures. Also backing the round is a number of angels, including Twitch co-founder Emmett Shear and Gusto co-founders Josh Reeves and Tomer London. The company was also a part of Y Combinator’s W20 class.

Image Credits: Dashworks

Source: Tech

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Daily Crunch: Google will offer G Suite legacy edition users a ‘no-cost option’

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To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PST, subscribe here.

Hello and welcome to Daily Crunch for January 28, 2022! It’s nearly blizzard o’clock where I am, so please enjoy the following newsletter as my final missive before hunkering down. In happier and better news, TechCrunch Early Stage is coming up in just a few months and not only am I hype about it, I’ll hopefully be there IRL. See you soon! – Alex

The TechCrunch Top 3

  • Google invests up to $1B in Airtel: With a $700 million investment and $300 million in “multi-year commercial agreements” with Airtel, and Indian telco, Google has made its second major bet on Indian infra. Recall that Google also put money into Jio, another Indian telco. The deal underscores the importance of the country in the future of technology revenues.
  • What’s ahead for Europe: On the heels of news that European startups had an outsized 2021 when it came to fundraising, TechCrunch explored what’s ahead for the continent. Some expect a slowdown from peak activity, while others anticipate further acceleration. Regardless of which perspective you favor, European venture investment is expected to remain elevated for some time to come.
  • Zapp raises $200M: And speaking of European startups, Zapp, the U.K.-based quick-convenience delivery startup, just raised a massive Series B. The company previously raised $100 million, meaning that this round was big in absolute and comparative terms. As we see some consolidation in the fast-delivery space, this deal caught our eye.

Startups/VC

  • Are charter cities the future for African tech growth? TechCrunch’s Tage Kene-Okafor has a great piece up on the site noting that “African cities have the fastest global urban growth rate,” which is leading to overcrowding. Some folks think that “charter cities offer a solution.” Special economic zones of all types have been tried before – will they offer African tech a faster route forward?
  • Personalized learning is hot: Our in-house edtech expert Natasah Mascarenhas has a great piece out today on personalized learning startups – Learnfully, Wayfinder, Empowerly, and others – that are taking the lessons of remote schooling to heart and working to make products that work better for our kids. It’s an encouraging, fascinating story.
  • Rise wants to remake team calendaring: There is no shortage of apps in the market to help individuals and teams work together. But we might not need as many as we have. That’s why Rise is making me think. The team calendaring app just raised a few million, and could replace a few tools that myself and friends use. I wonder if the solution to the Tool Overload of 2022 is tools that do less, intentionally.
  • Canvas wants non-tech folks to be able to squeeze answers from data: Developers are in short supply, so no-code tools that allow folks who don’t sling code to do their own building are blowing up. Similarly, a general dearth of data science talent in the market is creating space for tools like Canvas, which “is going all in with a spreadsheet-like interface for non-technical teams to access the information they need without bothering data teams,” TechCrunch reports.
  • Zigbang buys Samsung IoT business: The IoT promises of yesteryear are coming true, and not. Samsara recently went public on the back of its IoT business. That was a win for the category. That Zigbang, a South Korean proptech startup, is buying Samsung’s IoT unit feels slightly less bullish.
  • Series F-tw? Once upon a time I would have mocked a Series F as indication that the company in question had failed to go public. But that was then. Today Series Fs are not that rare. Indian B2B marketplace Moglix just raised one, which doubled its valuation to $2.6 billion. Tiger co-led the $250 million round.

And if you are looking down the barrel of a blizzard, TechCrunch’s Equity podcast has your downtime covered. Enjoy!

European, North American edtech startups see funding triple in 2021

Image Credits: Bet_Noire (opens in a new window) / Getty Images

Pre-pandemic, VCs were notoriously reluctant to invest in education-related companies. Today, edtech startups are seeing higher average deal sizes, more seed and pre-seed funding from non-VC investors, and an influx of generalists.

According to Rhys Spence, head of research at Brighteye Ventures, funding for edtech startups based in Europe and North America trebled over the last year.

“Exciting companies are spawning across geographies and verticals, and even generalist investors are building conviction that the sector is capable of producing the same kind of outsized returns generated in fintech, healthtech and other sectors,” writes Spence.

(TechCrunch+ is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

  • Northern Light Venture Capital’s He Huang says the Chinese robotics market is overheated: Per the investor, robotics in China is “riddled with speculation and overvalued companies,” calling the situation a bubble. It’s worth noting that China’s central government is working to retool where its tech investment dollars flow.
  • Robinhood goes down, back up: This morning, in the wake of the company’s lackluster earnings report, TechCrunch dug through why Robinhood’s stock sold off in after-hours, pre-market, and early trading sessions yesterday and today. And then Robinhood turned around and gained ample ground during the rest of the day. It’s a weird market moment, but good news for the U.S. fintech all the same.
  • Google to allow legacy G Suite users to move to free accounts: After angering techies still using the “G Suite legacy free edition” by announcing that it was ending the program and requiring payment, the search giant has decided to ”offer more options to existing users,” TechCrunch reports. Somewhere inside of Google, a business decision just met the market and was flipped on its head. Makes you wonder who is calling the shots over there, and if they previously worked for McKinsey.

TechCrunch Experts

Image Credits: SEAN GLADWELL / Getty Images

TechCrunch wants you to recommend growth marketers who have expertise in SEO, social, content writing and more! If you’re a growth marketer, pass this survey along to your clients; we’d like to hear about why they loved working with you.

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3 experiments for early-stage founders seeking product-market fit

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At Human Ventures, we have a fund for pre-seed and seed-stage investments, a venture studio and an Entrepreneur in Residence (EIR) program.

Through this work, we’ve discovered a lot about how different founders fulfill their journey of customer discovery and product-market fit. One of the largest challenges for pre-seed and seed stage founders is determining where to start: There are a million things to do. What should you do at each stage?

We interviewed three founders from our portfolio, all of whom ran discovery experiments to find their product-market fit at different stages of their company’s development.

Here’s what they had to share:

Pre-MVP/customer discovery phase: Tiny Organics

Tiny Organics is a plant-based baby and toddler food company on a mission to shape childrens’ palates so they’ll choose and love vegetables from their earliest days. The company raised $11 million in their Series A in 2021 and is growing at over 500% annually.

Founders Sofia Laurell and Betsy Fore joined our venture studio as EIRs and went through a six-week discovery sprint. As Sofia explains, they knew they wanted to build something to make parents’ lives easier and threw a lot of initial ideas at the wall from the Finnish baby box 2.0 (Sofia is Finnish) to an easier way to create Instagrammable baby pictures.

They went through multiple exercises to test the viability of new parents’ most pressing and urgent needs:

  • Conduct a “Start with Why” exercise
  • Define the “Jobs to be Done”
  • Create a lean canvas for each (viable) concept
  • Define the user journeys
  • Conduct user surveys using platforms like pollfish.com and 1Q (instant survey tool)
  • Identify and define their customer personas
  • Conduct customer interviews and synthesize them
  • Construct concept prototypes

They also met prospective customers, conducting a focus group of 10-15 moms. When the founders asked them to text them what they were feeding their children along with pictures for a week, they realized the lack of healthy finger foods in the market, thus sparking the idea for Tiny Organics.

Source: Tech

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