Musical.ly with Eva Xiao

Eva Xiao, China reporter for Tech In Asia joined us to discuss an interesting video and entertainment company from China, Musical.ly and how it has skipped the domestic market and built a massive following from US, Europe and rest of the world with an impressive portfolio of investors from Silicon Valley and China. She provided a comprehensive overview of the company, the founders: Louis Yang and Alex Zhu and the back story in how Musical.ly become one of the big apps that most teens across the world use.

Here are the interesting show notes and links to the discussion (with time-stamps included):

• Eva Xiao, China Reporter in Tech In Asia (@evawxiao, LinkedIn, Wechat: evawxiao, Tech In Asia)
  • What are the interesting topics you have covered recently with Tech in Asia? [1:03]
    • WeChat – the launch of Wechat mini-programs on 9 Jan 2017. [1:20]
    • Blockchain – the rise of blockchain technology startups in China focusing on anti-fraud for luxury brands, red wines and digital properties such as stock images. [1:56]
• Musical.ly [3:28]
  • Can you briefly describe the company Musical.ly? [3:43]
    • Origin story: education videos to 15-second video social network
    • Current products: Musical.ly (iTunes, Android) and Live.ly (iTunes, Android).
    • Over 130 million registered users, ~40 million MAUs
    • Coverage in New York Times, TechCrunch.
  • What’s the mission and vision of the company? [4:43]
    • Video/entertainment social network
    • “We want Live.ly to give users the opportunity to record their life through video.” – Louis Yang
  • Who are the founders behind the team, Musical.ly? [5:33]
    • Founders: Luyu (Louis) Yang and Alex Zhu
  • Who are the users of the Musical.ly app? [6:42]
    • Musical.ly app: ~40% in the US, 40% in Europe, the rest is spread across South America and Southeast Asia (Indonesia, Malaysia, the Philippines)
    • Live.ly userbase is primarily in the US
    • Average age is 13 – 20 years old, ~75:25 female-to-male ratio.
  • What are the features of the app (Musical.ly & Live.ly) that made it interesting as a company? [7:48]
    • 15-second ‘musicals’, 60-second stories (compilation of musicals)
    • BFF (Best Fan Forever), duets, guesting
    • Disappearing newsfeeds (ephemeral content) in Live.ly, an app that appeals to the rest of the world with features that are popular in China. [9:34]
    • Live streaming with Chinese characteristics (ex: virtual gifts, danmu)
  • Given it’s unique that it’s a China company which most of their audience or customers is in the West, how does this company manage to expand globally without being in China? [11:10]
    • China HQ is in Shanghai – but it’s mostly R&D staff
    • Limited local operations, relies on organic growth (no sales team)
    • Localization (cyber bullying, working with parents)
    • Heavy focus on product development with ~70% of staff in product
  • How does Musical.ly grow as a company with the focus on teens (or millennials)? [12:48]
    • Building KOLs or internet celebrities on their platform
      • Jacob Sartorius “Sweatshirt” music single
      • Baby Ariel’s 12 million followers
      • Lisa and Lena, German twins with their own clothing line
    • Working with celebrities and entertainment organizations
      • Selena Gomez, Ariana Grande, Alicia Keys, Daddy Yankee, and more
      • MTV Video Music Awards competition
    • Data-driven product development
      • “We make most of our product decisions by getting our user’s advice.” – Louis Yang
      • “We don’t make decisions based on what’s hot in China or the US, we make decisions based on our observations of user needs.” – Louis Yang
      • There’s a team dedicated to watching trends (ex: mannequin challenge)
      • Lots of user feedback via WeChat
  • Why has Musical.ly not replicate their success back on the Chinese domestic market instead? [15:15]
  • What are the revenue streams for Musical.ly? [16:26]
    • Relying on external investment at the moment
    • The focus is on product development and expansion according to CEO
  • Who are the investors behind Musical.ly? [17:15]
    • GGV Capital – Hans Tung
    • Qiming Venture Partners
    • Greylock Partners
    • DCM Ventures
    • Cheetah Mobile
    • CRCM Venture Capital
  • Where do you see Musical.ly going in the next 3 years? [18:36]

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The show is hosted by Bernard Leong (@bleongcw) and are sponsored by Ideal Workspace (Twitter, Facebook and LinkedIn) with their new Altizen Desk on Indiegogo (Twitter, Facebook, Medium). Also check out Ideal Workspace’s new standing desk, Altizen and sign up for their mailing list. Sound credits for the intro music: Taro Iwashiro, “The Beginning” from Red Cliff Soundtrack.