Bluesky Challenges Threads and X for Social Media Dominance | Pivot

1. KSKara Swisher0:00

   ... Blue Sky's growth doesn't appear to be stopping, with the platform crossing more than 21 million users. Keeps adding a million users a day, while the Threads has five times more daily active users than Blue Sky ahead of the election. That lead has now been reduced to 1.5 times, according, according to SimilarWeb. So people are really using it. Meta, uh, now seems to be feeling the heat, introducing new features suddenly. Oh, competition brings innovation and copying, including custom feeds around topics or people, mimicking Blue Sky's capabilities. Adam Mosseri, the head of Instagram, seemed to downplay Blue Sky numbers, sharing that Threads has more than 50 million signups in November alone. Agreed. Threads had been seeing a million new users a day for the last three months. Agreed. But it's very exciting that a young... that a small little, little thing is doing really well. Um, Blue Sky's financials. Blue Sky was initially launched as a spinoff of Twitter under Jack Dorsey. The company has since cut ties with him. Th- that was interesting, kicked his ass out. Now majority owned by its employees. So, uh, talk about the surge first, Scott, and then I'll talk a little bit more about the financials. I've been contacted by so many very wealthy people about investing in this thing, and very big names that... people I like, actually, um, who are meeting with them and talking to them. So thoughts, very... first on this surge, and then I'll get to the, um, investment soon.

2. SGScott Galloway1:14

   You know more about this than I do. I just got on. It's the hottest new product introduction, and I know that it's not... it didn't happen in 2024, but this is the hottest new product in tech right now, no doubt. Uh, its user base has gone from 30... 13 million to 23 million in just two weeks. Its usage, its daily active usage, is now greater than Threads. This is the hottest product in tech right now. And what I would ask you, I flip it back to you, and is that... and it's one simple question, why?

3. KSKara Swisher1:42

   Uh, well, you know, I think it's fun. It's actually fun. And, uh, look, I don't think you have to necessarily choose. I like both. I really do like Threads. Uh, I, I'd say... when Amanda was joking about it, she said, um, "Blue Sky is like the coolest bar you've ever been to, and why are you over at The Cheesecake Factory?" And I'm like, "The cheesecake is delicious." Like (laughs) , uh, you know, I think that's probably right, a good metaphor. Um, I, I li-... it's better for mar-... Threads is better for marketing my stuff, honestly, and actually has a nice vibe too, and it's a little more like Instagram with text. You know, like you... I can see... like, I don't find the really funny videos that I like. Uh, I, I find them on Threads much more. Like, I know it sounds dumb, chopping up food in creative ways or doing kind of cool karate moves or there's one I just pushed where a guy... let me look at it on Threads, um, at the top of my feed. Um, it's a guy who... mastering the art of camouflage to disappear in any setting. He's an artist who camouflages and then stands in front of things. I wouldn't have found that on Blue Sky. I would be uncool. So I'm fine with that, but I do like it. They're much funnier people. They are assembling a news-forward group of people, lot of journalists, a lot of Pauls are coming over. They're replicating that part of Twitter, the news feeling, and that's something that Threads had pushed away from, which is now... they're now moving back, letting people choose politics if they want, like politics and news. They were very much against it, and so you... days later you'd see things that happened days before. So I think Blue Sky has grabbed that, and I think that's why they're doing well, because some people like news out of these things. Some people like entertainment out of them. And so, um, I think... an- and it's a... it feels, it feels like old Twitter, but not in a toxic way. I don't think it's an echo chamber. By the way, guess who's building the echo chamber? Elon Musk is building an echo chamber over on, uh, over on his service, and to pretend otherwise is ridiculous. I mean, one of the stories that just came out is that how he's, he's, he's minimizing, um, uh, links to news, so... links to, uh, stories so that people don't get to see them. He's creating an echo chamber too, and that's what some of these things are. But I like them both. I like them both. So, uh, let me ask you about the money part though. Um, they've raised $15 million in Series A funding back in October, and then there's already interest, uh, in a new investment round. I... again, I've heard from lots of people. The CEO has said the platform is billionaire-proof because it's not one centralized feed of content. It's a protocol from which endless feeds can be created. You can also take it with you. And again, this echo chamber, I don't, uh, I think it's a nothing burger, but t- talk about h- why you would or would not invest in this.

4. SGScott Galloway4:24

   Oh, I mean, you're talking to a guy who invested in Post.

5. KSKara Swisher4:28

   Post, yeah, you and I do.

6. SGScott Galloway4:29

   Uh, look, there's... social media, why would you do it? To make money. Uh, uh, there, there is an enormous... the, the rivers are reversing. Uh, all the money that's gone into traditional media... the, the, the weird thing about media spend is it is arguably the most resilient business in the world. For about 100 years, advertising or media spend or ad-supported media has been approximately 1.5% of GDP. In a recession, it goes to 1.4 because what a lot of people... I'll go back here. A guy named Tyler Johnston, the CMO of Dreyer's. He was my first client out of business school for my brand strategy firm, Prophet. We went into a recession, it was '92, and he said, "We're increasing our ad spending because this is... just as all the bigger players are pulling back, this is a unique opportunity for us to grab share at a lower price because ad rates have come down." So generally speaking, media spending is incredibly resilient, but it never goes that much greater or that much lower. What's different is where the money goes.

7. KSKara Swisher5:33

   Grabs, the grabs, right?

8. SGScott Galloway5:34

   Oh my gosh, and the amount of capital still up for grab. When we talk about CNN, CNN still does a billion dollars. I mean, there's a lot of money still up for grabs here, and now there's going to be up... money up for grabs among the bigger players. And when you have an entity like that, if they raise money at a valuation of 15 million-

9. KSKara Swisher5:54

   Mm-hmm.

10. SGScott Galloway5:54

    ... that probably means it was sub-a-billion. You don't raise 15 million-

11. KSKara Swisher5:58

    Mm-hmm.

12. SGScott Galloway5:58

    ... on a billion. You don't, you don't, you don't-

13. KSKara Swisher6:00

    Yeah.

14. SGScott Galloway6:00

    ... issue 1.5% increase in shares. That probably means it was at somewhere between 50 and 200 million.Oh, my gosh. I'm- I'm immediately thinking, "Does Kara Swisher know this guy? 'Cause I want him to open up the rounds so I sh- I can get in." This is-

15. KSKara Swisher6:13

    It's run by women, but go ahead. (laughs)

16. SGScott Galloway6:15

    This is, this is, this is a company, they will do... I wish this was predictions day. They will raise a round, they will announce a round in the next 90 days, if not sooner, at a billion dollars plus. This is the hottest product in the hottest category in the world, and that is a media company, they can scale, um, uh, it has network, network-like scaling ability, and everybody is talking about it. Uh, so, yeah, why would you invest? So you can make a shit ton of money.

17. KSKara Swisher6:46

    Mm-hmm. Mm-hmm. Yeah. I would, I would think so. I think they're trying very hard, um, to, to make sure that it's, um, that, that it's, that, that people know people can take their things with them. Um, uh, the CEO was a woman, Jay Graber, has been an advocate of decentralization, empowerment. So they, you're, you're gonna get what, what, um, that kind of attitude towards it. It's not here for, you know, very heavy privacy rules. They love moderation, they toss people off, they feel... It's a whole d- they're creating a whole different thing.

18. SGScott Galloway7:21

    Censorship.

19. KSKara Swisher7:22

    Oh, stop it.

20. SGScott Galloway7:23

    Censorship.

21. KSKara Swisher7:23

    It's what they wanna do.

22. SGScott Galloway7:24

    Let me say, let me spread misinformation, and if anyone holds me accountable, it's censorship.

23. KSKara Swisher7:27

    You know who's censoring? Elon Musk. There's story after story today about this.

24. SGScott Galloway7:30

    But I will throttle content that I don't like.

25. KSKara Swisher7:32

    Right.

26. SGScott Galloway7:32

    That's not censorship.

27. KSKara Swisher7:34

    That's correct. Thank you. Um, so, um, so that's really interesting, and then the COO is a woman. It's woman-run. It's woman-run. But it's not, like, Precious in any way. (laughs)

28. SGScott Galloway7:43

    Well, get us in there, king of the-

29. KSKara Swisher7:45

    Uh-

30. SGScott Galloway7:45

    ... king of the woman Amazonia/

Episode duration: 8:51