The rise of the creator backed startup
Why the Minimum Viable Audience is more important than the Minimum Viable Product
Hey everyone! As always, I promise to only post when I have something interesting to write about 🙂.
I've gotten back on the founder seat and have been busy building Ritua, a creator backed, brazilian wellness app🏋️🧘♂️. If you've been reading this SubStack for a while you might have noticed that I built something relatively similar back in 2019 with Ânimo. The biggest difference between Ritua and Ânimo has been, of course, partnering with @eusougabriela, a pioneer (and arguably the first) exercise and lifestyle digital influencer who has garnered over 6 million followers over the past decade. We just hit our third operational month, and I've taken the liberty to get my head out of the weeds for a little bit to share what I think might become a trend over the next months and years: the rise of the creator backed startup.📈
The Tech and Investment Landscape's New Reality
Most pre-series A B2C startups are not really tackling hard engineering problems. In fact, most of the technology has already been built. It's never been closer to Lego as it is now. On the other hand Paid Acquisition costs continue to rise and global startup investment continues to plummet (last year alone had a 38% drop). If I were to summarize our current situation: Engineering isn't the hard part any longer, the hard part is building something people want and figuring out distribution while on a shoestring budget. However, there might be strategy that's proving to be effective: entering the arena with a pre-qualified audience.
Instagram pages and Youtube Channels are a new form of MVP
Perhaps the new step that happens before the MVP is the minimum viable audience. In my opinion this is what will define the next wave of successful B2C apps. There is a lot less friction to deliver a value proposition over Instagram/Youtube than building something entirely new from scratch. It’s much easier for entrepreneurs to test and refine their value propositions before launching a higher friction standalone product. Also, let’s be real: if you can’t get people to consume your content, it will be a lot harder to get them to buy your product.
The Evolution of Creators into Entrepreneurs
The role of digital creators is evolving and they're increasingly moving beyond traditional monetization routes like YouTube ads or Instagram sponsorships. Larger creators like Mr Beast frequently produce videos with viewerships larger than the SuperBowl's yearly 125 million eyeballs. Understanding that fewer and fewer companies can afford a SuperBowl level of ad spend(or frequency) has pushed him to create Feastables, his own product line. Another great example is James Clear's recently launched Atoms app. What started as a NYT bestselling book has become a standalone product. In short: Creators are challenging the traditional advertising model and underscoring untapped potential revenue sources by using their audiences to build their own products.They're no longer just content producers; they're becoming entrepreneurs, leveraging their platforms to launch their own ventures.
Closing thoughts:
In an era where content saturation is a given, the barrier to becoming a creator and building an audience has never been lower. This also means that although content creation has been democratized, it's also never been harder to build a healthy, long-term, sustainable audience. Those that do manage to capture an engaged following will be able to set the stage for a new wave of B2C apps. Creator-backed startups are not just a trend; they might be one of the few viable routes to kickstart the flywheel.
If you're already well on your way with your B2C startup but have struggled to hit unit-economics I highly suggest you try partnering with a creator working on a similar problem. There are plenty and they can be your hack towards distribution.
As we look ahead, the potential for creators to impact the startup ecosystem is immense. The journey with Ritua is just one example of how leveraging a built-in audience can redefine what's possible. The rise of the creator-backed startup is just beginning, and I'm excited to see where this path leads us.
🌎 Cool links from around the web
LLMs are the new corporate Ozempic. Everyone's doing it, but no one wants to admit it. “The layoffs are no longer a signal of economic conditions, but innovation.”
The XZ attack timeline
Humanity just dodged a catastrophic security meltdown. The internet runs on Linux servers, and the open source XZ compression library that is the (boring) standard was the target.
The summary:
Groq, the AI gamechanger:
A longer than average but very interesting video that explains CPU<>GPU<>LPUs, how Groq manages to achieve such speed, and the possible implications in the near future.
Tiktok as a cyberweapon
We've been hearing about the weaponization of Social Media on an electoral level, but Ryan McBeth goes deeper and explains how state actors can very easily and cheapily wreck havoc anywhere in the world.
Thanks once again for reading this far. If you have any questions, think I can help you out, or would like me to address a specific issue… feel free to hit that reply button :)
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