Why Aren't More People Talking About Flipagram? (Q&A)

Roughly 18 months ago, Flipagram was little more than a smartphone utility, an app for users to stitch photos into a slideshow they could then share on other Internet platforms like Facebook or Twitter or Instagram.

Now it wants to keep those slideshows inside its own app. The hope is that its users will follow and like and share them with one another inside Flipagram just like they did on Facebook and Twitter and Instagram, transitioning from a photo editing app to a social network.

Flipagram claims 36 million active users, up from about 10 million a year ago. Those users flip through five billion photos and videos per month. It has been a model of consistency in the U.S. App Store over the past year, rarely dropping out of the top 10 in the “photo and video” apps category, according to App Annie. The company’s board includes famous VCs John Doerr of Kleiner Perkins Caufield & Byers and Mike Moritz of Sequoia, a duo that also sat on the same board together more than 15 years ago at a little-known startup called Google.

Despite all of these attributes, few people know Flipagram as anything more than a slideshow creator, if they know what the app is at all. We interviewed CEO Farhad Mohit to ask him why that is, and how the company plans to compete in a social world that doesn’t make room for very many newcomers.

The following has been edited for length and clarity.

Flipagram

Re/code: You’ve been around a few years, have a lot of users, have some famous board members. Why do I feel like few people know what you guys do?

Farhad Mohit: [Laughs] [It’s been] an unorthodox way we’ve evolved from a tool into a network and our network is still young. As we were doing that we weren’t making a lot of press about ourselves, because we wanted to really have all of the ducks lined up. Those ducks include having our network in place, our music deals and licenses in place and scaling the business that we want to talk about rather than doing a lot of flag waving about ourselves as a tool.

It feels like most successful social companies start with a network and add tools after. You’re going the opposite direction. Why?

The question you have to ask yourself as a starting company is how are you going to get a lot of users interested in your product. The answer for us and for some others was to make it as simple as possible with enough utility. I actually think there are a lot of examples of folks that started out as a utility or tool and then kind of expanded that out into more of a network. Instagram is a good example of one. It really started out making your photos prettier for Facebook.

Instagram also had a lot of help building that network from Facebook, though. Do you ever think about trying to sell or team up with an existing network versus building one yourself?

No. We’re building a product and we’re doing a decent job of it. Would someone like Facebook do things differently than we did it or even better? Possibly. But we have our heads down building and we’re excited about what we’re building.

How important is it for you to have users sharing their stuff inside Flipagram versus other networks now?

There’s always a tension between those two because one of them will get you new users by exposing them to the object. The other, of course, keeps users on your platform. A lot of people know about Flipagram now. We’re building new features to hopefully make it more and more likely people will share to Flipagram.

You let people add music to their videos, which most platforms avoid because of copyright issues. Why did that matter to you?

At its core, a Flipagram is a video story. Think of it as a mini movie. Imagine a horror movie without a horror soundtrack. The music plays such an important role in the tonality and emotional leverage of that movie.

So you went out and struck deals with labels, yes?

We did it kind of like entrepreneurs do sometimes, we kind of just did it and [decided] we’d ask for permission after. It took a good year and a quarter or so from the first outreach and the first set of deals coming in. It’s a very complicated rights environment that’s been created in music copyright. Suffice to say I had a pretty good education in music rights management by the end of it.

(Editor’s note: Flipagram has access to more than 40 million song previews thanks to deals with major labels like Universal Music Group, Sony Music, Warner Music Group, Merlin and The Orchard.)

Update: Flipagram reached out to Re/code to clarify its approach to music rights in light of recent press following this Q&A. “Flipagram takes its obligations to music rights holders very seriously,” a spokesperson said in a statement. “The company has worked to secure agreements that ensure music rights holders are happy and fairly compensated for the use of their music on Flipagram.”

What’s the business behind this music strategy?

We saw these one and a half minute previews sitting on places like iTunes and the way you activated them was hitting this gray triangle and listened while this little circle went around. That looked like an asset we should be able to leverage better. Why not have music previews carried on people’s stories? It’s a huge benefit to the user, but a huge benefit to the song writer as well.

So if someone likes a song they can click to buy it — I assume there is some kind of revenue split between yourself and the artists or labels?

We’ve secured the rights to these previews with separate agreements with each of the labels that compensate them for their rights and their artist’s rights. And then separately we are an affiliate of iTunes. When songs get bought on iTunes [from Flipagram] we get a little commission just like other affiliates.

Are you actually driving downloads?

Absolutely. If we feature a song, hundreds of thousands, sometimes up to a million Flipagrams get created for a particular track. One Direction’s “Story of my Life” is my favorite one because [there have been] something like five million Flipagrams created with it.

Will music sales be a big part of your business down the road or will you move toward advertising like most other social networks?

Every Flipagram has the potential to [link to something else]. We think of Flipagram as a short, really powerful object that can get people from leaning back in your chair to leaning forward and then the link is the next step. So you might show, “Here are all the rooms in my Airbnb house,” and then [a viewer] might be excited about that and go to Airbnb to book it. I’m just making that example up. At the moment, those links are all free for everybody and we want to see how people use it, but down the line we may charge for that.

This article originally appeared on Recode.net.

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