🇬🇧Thanks to the feedback of readers, I have decided to switch the newsletter into English, in order to avoid mixing French and English and bring more consistency to the content - at least for a few weeks. I hope it will suit you - so impatient to know what you think about it! 🇬🇧
Welcome to the 57 people who have joined us since last Tuesday! If you're reading this and haven't subscribed yet, please join the 3018 people who have already joined the move. It's right here!
Like every week in the JCNews, you’ll find my latest and most interesting readings, including a read!
👉Comment quantifier l’impact de nos applications préférées (a16z)
The fastest growing companies therein, according to year-over-year monthly active users:
Among them, interest-based platforms that drive meaningful new relationships. Friend discovery app Itsme, for example, lets users have synchronous conversations while showcasing their personalities through avatars
Meanwhile, fast-growing vertical communities like Public and Bunch bring users together around shared interests—in this case, stock market investing and gaming, respectively. Users can delve into their hobbies and passions with niche-tailored product features, and discover a community of like-minded people in the process
It's very interesting to note the diversity of success in recent years: many players have chosen to exist in a niche of committed people, to be able to push the customization of features to its maximum.
DAU/MAU represents the ratio of the two, which indicates a product’s “stickiness.” For example, a DAU/MAU ratio of 33 percent would mean that the average user of said app views it 10 out of 30 days in a month.
At its essence, DAU/MAU is a high-level lens with which to evaluate an app’s network effects: the more frequently users engage with a social network, the more valuable the network becomes to them and, ultimately, the stronger that network grows. DAU/MAU indicates frequency of use; it’s how that ratio evolves over time that signals a working social flywheel.
Finding the right metric to evaluate its impact is crucial (and we often talk about it here, as in JCNews #52). The DAU/MAU ratio is a "classic", but one must be aware that, like any tool, it has limits:
Understanding social app metrics:
DAU/MAU can be a blunt instrument—in most cases, it doesn’t tell the whole story.
For this reason, in social, DAU/MAU levels are often highest around media consumption: listening to music, watching videos, playing games, or scrolling social media.
It’s important to understand how these metrics relate to each other, rather than applying one standard across the entire spectrum of social apps.
In particular, time per session is also very relevant to understand user engagement, especially for the many great apps that you don't really need every day:
Addiction + absorption: A framework for time spent on social apps:
It’s useful to have a pulse on the depth of engagement—that is, how much time users spend in the app.
The most “engrossing” apps (the average number of minutes active users spend in the app per session).
It’s evident that depth of engagement does notnecessarily equate to stickiness. Similarly, not every app has to be used on a daily basis to be valuable.
I find this graph very interesting regarding the diversity of possible app uses (even among mainstream social networks). The correlation between depth and frequency of engagement is far from being perfect: addiction is one thing (going very often on one's app), absorption is another (spending time on one's app).
There’s value in going niche
Illustrating the relationship between niche-specific communities and content engagement, one study of 2,161 Strava activities by researchers at Ghent University found that Strava activity posts were roughly 8 times more likely to receive any sort of community engagement than Twitter posts. This high level of (largely supportive) community engagement, paired with the gamification of activity levels in the app, can ultimately incentivize users to run or cycle more often—and oftentimes to post more.
🏯Building a company
In addition to selected articles, I share one of Alan's leadership principles each week - the same one I share internally and with our investors every Wednesday.
Alaners are very nice and supportive of each other, and it is key to who we are. It should not block us from sharing the truth even if it can hurt (there are ways to do it well).
We are open and honest. We do not withhold information or tell half-truths. Even if the truth will be difficult to hear or to say, we err on the side of truth in the face of difficult consequences.
We do not, however, dwell on trivial truths with the intention of hurting people’s feelings or making them look bad. We tell the truth to make people better, not worse.
What is really important is that instead of condemning people, we try to understand them. We try to figure out why they do what they do. That’s a lot more productive and helpful than criticism; and it breeds sympathy, tolerance and kindness. “To know all is to forgive all.”
Questions to help you see through the lens of opportunity cost:
And then what?
Compared to what?
At the expense of what?
Most people focus on what something costs today. These “direct costs” are easy to see and measure. Looking through an opportunity lens takes these direct costs into consideration but also considers indirect costs. Indirect costs can be foreseen but not measured. They include the cost of doing something, the cost of not doing something, the cost of what you could be doing, and, importantly, the cost of not doing something right.
👉About how to take decisions and distinguish the decision making process and its outcome (Howard Marks)
You can't tell the quality of a decision from the outcome
We can make the best possible decisions and still not get the results we want
You need a sense for whether your holding is a good one and for the chance the competition - the market, which you're playing against - might have better
You need the discipline to follow a process and the wisdom to accept that no process is sure to produce good results
You have to understand the significance of the information you have, as well as that which you don't have. You need the nerve to bet heavily based on what you think you know and a healthy respect for what you may not know
Maybe we chose a path with very high likelihood of success and got unlucky...
If we aren't wrong just because things didn't work out, then we aren't right just because things turned out well
In the long run, superior skill will overcome the impact of back luck.
🗞In the news
👉How Discord (accidentally) invented one of internet futures (Protocol)
In early 2015, a new tool called Discord showed up on the market. Its tagline was not subtle: "It's time to ditch Skype and TeamSpeak." It had text chat, which was cool, but mostly it did voice chat better than anybody else.
Discord is at the center of the gaming universe. It has more than 100 million monthly active users, in millions of communities for every game and player imaginable.
It's pushing to turn the platform into a communication tool not just for gamers, but for everyone from study groups to sneakerheads to gardening enthusiasts.
It was a painful transition. Hammer & Chisel shut down its game development team, laid off a third of the company, shifted a lot of people to new roles and spent about six months reorienting the company and its culture. It wasn't obvious its new idea was going to work, either. "When we decided to go all in on Discord, we had maybe 10 users," Citron said. There was one group playing League of Legends, one WoW guild and not much else.
The Discord team ended up completely rebuilding its voice technology three times in the first few months of the app's life. Around the same time, it also launched a feature that let users moderate, ban and give roles and permissions to others on their server.
Voice chatting in Discord isn't like setting up a call, it doesn't involve dialing or sharing a link and password or anything at all formal. Every channel has a dedicated space for voice chat, and anyone who drops in is immediately connected and talking. The better metaphor than calling is walking into a room and plopping down on the sofa: You're simply saying, I'm here, what's up?
The ladder of communications, from text to voice to video, has always been important to get right. Communities can decide who gets access to certain tools and design their space however they want.
👉 LA-based Sidecar Health’s low-cost, cash-pay health insurance service is now valued at $1 billion (TechCrunch)
Sidecar Health’s insurance plans give consumers the ability to pay directly for care — often at steep discounts to the prices that patients would be charged through traditional insurance plans.
The core of Sidecar’s plan is an ability to offer its policyholders the ability to pay directly for their medical care — and shop around to find the best provider using pricing information that the company provides through its mobile app.
Sidecar’s app provides real-time, geo-located information on the costs of any number of medical procedures, consultations, or drugs
The money comes from Sidecar’s claims accounts and is paid directly to doctors.
Sidecar can reduce overhead for care providers who like to get paid directly and will offer discounts in exchange for receiving cash in hand.
Quigley said it would end the year above 30,000 members.
👉Flexible leaves at Alan (Capital). Diane Rivière, our Culture & People Lead, discusses our internal leave policy, based on trust.
👉Founder Associate Recruitment(Lever).
I'm recruiting my future right-hand in a few weeks, don't hesitate to apply on Lever!
👉 Alan launches Alan Baby - My freemium readings
As I've shared with you in the past weeks, we at Alan are very proud to have launched Alan Baby - the application that allows young parents to get a good night's sleep. Parents' community, medical chat with doctors, personalized advice: everything is there to follow serenely every step of the baby's development - for free!
Why Alan Baby? Alan's ambition is to reinvent healthcare and become the personalized health super-app for all Europeans. We deeply believe in the benefits of a simpler, tailor-made and delightful health experience. For us, this means creating personalized health services, and we have decided to address, one after the other, different specific use cases. Alan Baby is therefore our first app, specifically designed for the health needs of young parents.
What are our sources of inspiration? Here are the readings that most influenced us at Alan in the design of this product:
Freemium vs. Free Trial (David Sacks, JCNews #42). The choice between freemium and free trial is a decisive one. Is it better to give access, for a limited time, to a part of the features, or to all the features?
Les trois règles du freemium (Medium, JCNews #53). A very interesting article in which Christoph Janz helps us to better understand the value of freemium for his company, but above all that it doesn't work every time! You have to keep an eye on 1) The potential virality of the product 2) The profile of the freemium users compared to the paid users 3) The gross margin of his product.
Comment mesurer l’engagement en SaaS (c’est différent du B2C) (David Sacks, JCNews #52) Building the right metrics (with the right reprocessing) is the key to any good measurement - and hyper important to follow your freemium initiative.
Reliance: la porte d’entrée de l’Inde (Not Boring, JCNews #52), which looks back at Jio's incredible playbook, an Indian telco, and its growth strategy - Jio has grown from 1.5 million subscribers to 398 million subscribers in the first half of 2020 by offering up to six months of free data and voice. A great source of inspiration!