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Clubhouse, the new player on the social media block, is already making big waves. It has already reached the one billion USD

Clubhouse (1), part house party, part talkback radio, and part conference call is a social networking app. It is based on audio-chat. People can listen to conversations, discussions between interesting people on various subjects, and interviews on this platform.

The Clubhouse is similar to a podcast in shorts, but it is live, and its invite-only model gives the platform an added layer of exclusivity.

One can’t download the app off the app store and create an account. It is like a real-life country or a yacht club. One needs an invitation to join by an existing member, to become a part of the virtual club.

Upon joining, one can select a wide range of interest topics such as books, tech, business, or health. The app will give recommendations` about individuals and conversation rooms one can follow or join based on the information about his interests.

Notably, the conversation room available at Clubhouse is similar to a conference. However, here, only a few people are talking, and most are only listening. Similar to a phone call, when the conversation is over, the conversation room is closed.

Unlike Twitch, where people can return and watch live stream videos since they stay on the platform, on Clubhouse, the live audio-chats in conversation rooms disappear.

However, it doesn’t stop users from recording a live conversation. For instance, a Youtube user live-streamed a conversation room launched by Elon Musk (2).

Getting an Invite

If you wish to join the platform, you need to ask an existing Clubhouse user to send an invite from their app. It would give you access to set up an account. If you get the invite, there will be a link sent to your phone number. It would direct you to the app’s sign-up page.

It is also worth highlighting that Clubhouse users can’t send an invite to anyone who wishes to join the platform. Instead, the existing users only have two invites available at first.

Even though the membership is available by invitation only, at least for now, there is still another way one can join the platform.

One can download the app and reserve a username, and get himself on the waiting list. After doing it, anyone he knows who is already a member may get a notification, and they may let you in if that happens.

At present, Clubhouse is only available on Apple devices. However, in a recent blog post, the Clubhouse creators had announced that their 2021 goal is to complete the app’s beta stage. Once completed, they are eventually working on opening up Clubhouse to the entire world (3). Indicating that the platform would soon release for Android phones too.

Elon Musk Hyping Up the Platform

Clubhouse, launched by Silicon Valley entrepreneurs Paul Davidson and Rohan Seth, has been around since March 2020. It only had about 1500 users in May 2020, with a valuation worth about 100 million USD (4).

However, from this past week, Clubhouse had burst onto the mainstream when Elon Musk hosted an audio-chat on the platform with Robinhood CEO Vlad Tenev.

The event maxed out the platform’s conversation room limits and was live-streamed to YouTube. It helped boost Clubhouse to the top of the startup charts and led to a scamble of invites.

As of the beginning of February, Clubhouse has 2 million users (5). The platform announced upcoming new features such as tipping, subscriptions or tickets, and directly paying creators on the app.

Such features would allow content creators on the platform to get paid. However, how all of these would come together is still under discussion. Nevertheless, the current user base of about 2 million USD is likely to see exponential growth once it is open up to the general public.

(For comparison, Twitter is currently boasting over 300 million users, and Facebook is approaching three billion users.)

And after raising new fundings since its inception, Clubhouse now has a valuation worth over one billion USD (6), entering the unicorn club with the likes of Uber, Alibaba, and SpaceX.

According to Reuters reports, the Clubhouse membership demand is now so hot that there is a growing market for them on platforms such as Reddit, eBay, and Craigslist.

In China, people are selling invitations on Idle Fish, Alibaba’s second-hand marketplace.

During his conversation with Tenev, Elon Musk also summed up the appeal of Clubhouse. He noted that ‘the context of switching is the mind-killer.’ He talked about the idea that when users are logged into the platform, with their notifications disabled, it will allow them to focus on one topic at a time.

Clubhouse Popularity in China

Notably, the Clubhouse app value extends beyond exclusivity, and Musk’s talks about focus and success.

In China, local ecommerce sites are offering hopeful Clubhouse users a chance to buy invites. Platforms such as Taobao and Xianyu are selling invitation codes for about 150 to 400 yuan, about 23 to 61 USD.

Unlike other social media sites such as Facebook and Instagram, amid the censorship and government control rife, China is yet to block Clubhouse by its firewall.

According to Quartz report (7), Chinese users, especially tech investors and professionals, use the Clubhouse app to talk about topics that would otherwise be censored in their homes, like democracy.

What Happens Inside?

Clubhouse, the new player on the social media block, is already making big waves. Even though it is less than a year old, it has already reached the one billion USD valuation and has capitalists scrambling to invest.

The invite-only app has already garnered a legion of high-profile fans and more than two million users.

Moreover, it seems like the coronavirus pandemic has already created the ideal conditions for Clubhouse to flourish. With people isolated because of lockdown, safety concerns, being desperate for social connection. Even though text-based social is alright as far as it goes, a voice is a real alternative.

Users can follow other users or interest topics and join themed ‘clubs.’ Then, users have access to a selection of chat rooms that focus on different topics. Notably, many of them are tuned to the zeitgeist.

Conversation rooms on Clubhouse come in all sizes. There are some with only a few people chatting informally. Others contain hundreds or even thousands of people listening to a panel of experts. It can include politicians, business leaders, or celebrities.

The others in the rooms are visible, and one can also bring up their profiles and complete with a list of who they are following. The algorithm of Clubhouse takes all of it into account when offering content choices.

If one wishes to say something, they can raise their hand, and the room owner can give him speaking privilege. One can also applaud a speaker by rapidly clicking the unmute/mute button.

Remarkably, all of this is happening in audio-only mode. At best, it is like eavesdropping on a fascinating discussion, with an ability to join in if one has something notable to add.

Several early users are raving about much they like it. One of the many reasons Clubhouse is getting so popular is that audio can feel more intimate and live than text-based social media platforms (8).


Within a short time, Clubhouse has accumulated an enviable social media prominence. At present, one can only access the app via an invitation from an existing user.

From its initial popularity among Silicon Valley investors, Clubhouse has attracted an impressive number of public figures such as Oprah Winfrey, Drake, and Elong Musk. One will find several experts with deep domain knowledge, politics, and celebrities talking about their latest ventures and projects.

Such well-known users have become a major draw-card for Clubhouse with a relative scarcity of invitations, adding a sense of exclusivity.

Since conversation rooms at Clubhouse are temporary, the room disappears, and the discussion is gone forever when the meeting ends. The rooms’ temporary nature could help stop the formation of ‘echo chambers’ where people are only exposed to those they already agree with (9).

Discoveries of Clubhouse Success by Elon Musk

The arrival of Elon Musk on the audio social network platform Clubhouse served as a validation for the firm and the idea of live and interactive audio streaming.

As soon as Musk started the conversation room, even though it was at 1 am ET, the room quickly hit the Clubhouse’s cap of 5,000 concurrent listeners. There was also an overflow in the room, which hosted a broadcast of his appearance. And, there was another overflow in another room after that. In short, all day long, there had been an overhaul to get in on the action. There were pre-show discussions, recaps, and even a cash giveaway, at least in one case, sponsored by Square.

Even though there are many ways to think about Clubhouse, one of the most notable and consequential is that one of its first successful uses was to build a backdoor pilot for venture capital firms ending their run around the mainstream media.

In the tv industry, ‘backdoor pilot’ is proof of a full series concept. There is an episode of an existing show that introduces a new character, which then goes on to have his own show (10).

However, it is still not the only way to think about Clubhouse.

In 2016, a startup named Anchor launched a product with a hope among its founders to ‘democratize radio.’ It offered some simple tools for recording audio, hosting it, and some social features that allow users to find and follow other creators.

However, the team struggled to discover the product-market fit. Even though some hit podcasts emerged from the platform, Spotify ultimately bought it for 150 million USD (11).

For Anchor, it turned out that podcasts do not lend themselves easily to a DIY, do-it-yourself approach. It is difficult to record pristine audio and even more tedious to edit. Moreover, today’s podcast market is powerful enough to have numerous professionally recorded podcasts hosted by celebrities in their domains. It is certainly more fun to listen to than any DIY project on Anchor.

Coming back to 2021, Clubhouse is hitting upon something genuinely compelling. Unlike Anchor, Clubhouse rooms are not unbearable to listen to since users are literally on the phone while using it. It sounds like we are on a phone call, and since the conversation is live, one is also less sensitive to the fact that it is unedited.

Elon Musk’s appearance on the platform highlighted serendipity about Clubhouse that is making it compelling. The most interesting part of Musk’s talk was not the first half-hour when it talked about colonizing mars and his favorite memes but when he invited the CEO of Robinhood, Vlad Tenev, on to the virtual stage.

Of course, Robinhood had a hectic week, and Musk has also been skeptical about its move to stop users from buying GameStop stocks (12). In the talk, Tenev explained things that happened following the entire GameStop frenzy.

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It was not exactly an investigation on Musk’s part, and Robinhood PR has posted various such explanation on its blog. However, the whole thing felt like a stunt considering that A16z (13) is a major investor in Robinhood and Clubhouse.

Even though it is a fair point, we can’t skip over the part that the world’s richest man is lightly interrogating the CEO of the week’s most controversial company, live in a free broadcast.

Notably, from Facebook to Twitter to Twitch, streaming video tools are available for years. However, we have never seen them used like this.

There is something more approachable about an audio-only broadcast that has enabled entirely new uses.

Today, we are awash when it comes to podcasts. It seems like every person of note has interviewed every other person of note on one podcast or another. Yet, if one wishes to reach the person who listens to podcasts, starting a regular podcast and building up its audience over time has been the only option.

Even though it is fine for dedicated podcasters, but if you are Elon Musk and need to ask only a few questions to Vlad Tenev in front of an audience, well, now, one can go on Clubhouse. It is there when he needs it and doesn’t need to be thought about otherwise.

In short, Clubhouse allows one all the distribution upside of a podcast without planning, editing, and other actual podcast needs (14).

Clubhouse Making Noise in India

In India, Clubhouse has about 12,000 downloads, according to analytics company Sensor Tower. It has triggered a passionate debate among startup leaders torn between listening to Finance Minister Nirmala Sitharam’s budget speech or plugging into Musk’s high profile talks with Vlad Tenev, who has turned into a saga of meme stocks (15).

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“Let’s do a Clubhouse’ has become a phrase now; it means ‘let’s get together and talk,’ it has become a new space for knowledge and opinion consumption.”

– Kunal Bahl, Snapdeal Co-founder and an angel investor (16).

According to Bahl, Clubhouse’s live audio format provides an element of authenticity that has the potential to spawn a new generation of creators to monetize their skill and knowledge about niche topics that other value.

Since its launch last year, those interacting on the platform in India include fintech leaders, such as Kunal Shah of Cred, Nithin Kamath of Zerodha, and Harish Mathur of RazorPay. Other edtech entrepreneurs are also on the platform, including Unacademy’s Gaurav. Munjal, Toppr’s Zishaan Hayath, and ShareChat’s Farid Ehsan as well (17).

Harish Mathur joined the elite platform last year to hear from interesting folks of Silicon Valley. He stated that his experience has been good so far since the format allows a free-flowing discussion and is running conferences all the time while allowing people to be free and casual.

Moreover, he is not alone in the Indian startup ecosystem who believes that the spontaneity of discussions among people and the authentic nature of conversations between people is what makes Clubhouse stand out. Especially at a time of the pandemic, where in-person meetings are curtailed.

Notably, the ‘Indian Startup Club’ is among the biggest group on the platform in India, with more than 4,000 members. There are several rooms by the group where Indian entrepreneurs and founders can talk about their journey.

At present, there is no way for Clubhouse’s users to pay for content via the app. The platform is free, and there are no advertisements or premium subscriptions. There is a theme of users on social media platforms that if a creator can’t monetize his content on a given portal, he is more likely to move onto another when he gains traffic.

And since the founders have announced that they are coming up with plans to introducing models soon, it seems like Clubhouse is making an early-bet to attract more users by offering them a way to monetize their content (18).

Soaring Shares

There is no doubt that Clubhouse witnessed quite a week after Elon Musk appeared on a session and causing an overflow. Now, there is a frenzy among people to join the invite-only audio-based social networking platform.

The Clubhouse’s partner Agora is basking in glory as its share prices have surged over 50% from the last week’s closing price. Notably, its stock had gone up to 90.77 USD this week from 56.38 USD last week (19).

As per the South China Morning Post (20), Agora was listed in NASDAQ in the previous year. It offers a platform for real-time audio communication, the backbone of Clubhouse.

And the interesting part is that, even though both companies are getting huge interest from silicon valley, they have never publicly talked about their partnership.

Despite the fact that Elon Musk increased GameStop and Etsy’s stock prices by tweeting about them, he has never mentioned Agora in his talks. Nonetheless, his presence on the platform was enough to boost the company’s valuation.

Author’s Note

Innovation’s history is marked by people building serendipitous connections. Meeting the right people at the right time, such unplanned connections are not made on-demand. However, one can create the right environment for them to happen spontaneously.

Since Clubhouse doesn’t record any conversations happening on the platform, it encourages spontaneity and off-the-cuff conversations.

Critics are saying that it would also make the space for racism and misogyny. Undoubtedly, as Clubhouse would grow further, it would also face challenges around content moderation and transparency, as the case with Facebook and YouTube.

Nevertheless, voice-based networks like Clubhouse features are well-suited to building the right environment for making serendipitous connections.

And now that the company is jigged up let’s see how Clubhouse would fare now. Let us know your thoughts in the comments.