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This episode features Selcuk Atli, the CEO of Bunch, and Harsh Kher, the product manager at Bunch to get to know and see what it’s like to be in the midst of very heady growth right now.

We have a very topical and very insightful episode for you guys. We answer the question: what’s it like to be on the inside of an app that is seeing breakout growth in the middle of the crisis that we are in right now?

Bunch is an app that allows users to video chat while they play games. Over the last couple of weeks, Bunch has seen a massive increase in usage and engagement. With the DAUs growing many folds and the app breaking it to the top hundred overall on iTunes in nine countries and top 10 in four countries at the time of recording.






ABOUT SELCUK: LinkedIn  | Twitter

ABOUT HARSH: LinkedIn

ABOUT BUNCH: Bunch  | Twitter



ABOUT ROCKETSHIP HQ: Website | LinkedIn  | Twitter | YouTube


KEY HIGHLIGHTS

📈 Bunch’s growth trajectory prior to March – and what they started seeing in their metrics in mid-March.

2️⃣ The two trends that Bunch sits at the confluence of that likely drove a surge in their usage.

👥 How the age and gender composition of Bunch’s user base shifted literally overnight.

💭 How users’ nostalgia might be a reason they’re adopting Bunch.

🤝 Bunch’s onboarding and activation rates are higher than before in spite of there being no change in the product.

⚙️ Keeping the servers up is the highest priority right now.

💸 Infrastructure costs start to go up with sudden growth.

💡 The qualitative & quantitative factors the Bunch team sees that suggest that this growth trajectory could be sustainable long-term.

👨‍💻 How Harsh’s role has evolved and changed from being a growth intern/analyst.

KEY QUOTES

Unexpected users

We started seeing a surge of Italian users. Yeah, a whole bunch of users started coming to the application. And like a common question at the office was like, who are these users?

Leveraging nostalgia

We’re a team of 16 people who grew up playing LAN parties and Nintendo with our friends. So you play Mario Kart, or you play Counter Strike. And a lot of the fun is the feeling of being in the same place, yelling at each other, or basically making fun of each other and having that camaraderie.

The unexpected side effect of rapid growth

It’s been kind of crazy to kind of blow through the free tiers or low paid tiers of a lot of the analytics tools that we use. But the nice thing is a lot of these services offer programs to high growth startups to kind of reduce the immediate rush of pain that you can get from having to pay for these things. 

How to sustain the effects of virality

Normally as your app is going viral and getting like a huge influx of traffic, you would expect the drop in frequency right? Maybe this is because we’re a social network that is solving a significant problem. Our frequency and retention are going up as traffic is growing. 

Social interaction cements gaming behavior

You see lasting behaviors in multiplayer games that are kind of behaving as social networks. There’s a reason why people still play League of Legends. There’s a reason why people still play Minecraft and Clash Royale. When you think about these real time multiplayer games where people experienced games together in real time with their friends, they’re essentially social networks on their own regard. That’s why people have been playing Minecraft for so long. 

Game-changer

It’s almost like when people are talking about product market fit. A lot of people change their products to fit our market. It looks like the market changed to fit our product in our case. 

FULL TRANSCRIPT BELOW

Shamanth: Harsh, Selcuk, excited to welcome you guys. Welcome to the mobile user acquisition show.

Selcuk: Thank you for having us. 

Shamanth: Absolutely. You guys. To start, can you set the lay of the land and to the extent you’re comfortable sharing, tell us about what your growth trajectory was like prior to March?

Selcuk: To also set a little bit of context, essentially, like you mentioned, what we do is we let people group video chat with their friends while they’re playing their favorite games, kind of like a LAN party, but on your phone. What really happened is our usage in February were like, not crazy, right? So we were like, steadily growing. 

We’re like a normal consumer social app. But then we’re like slowly and steadily getting more users. And one of the interesting things that we started seeing is probably two weeks ago, and I think Harsh would know this better.

We started seeing a surge of Italian users. Yeah, a whole bunch of users started coming to the application. And like a common question at the office was like, who are these users?

Yeah, right. Because we didn’t run an influencer campaign. We didn’t build a new growth hack or anything. And then we realized they were from Italy, and then we’d start basically messaging with them, like, hey, how did you find the application and they would say, like, “hey, we’re stuck at home, we can see our friends and we discovered this app, it’s so much fun. We love it. It’s a great way to stay in touch with our friends. And it’s kind of like the game parties or LAN parties that we used to have growing up.” 

And right after that, we started seeing an influx of users from Spain and Canada. And then Indonesia, India, South Africa, we are basically like a top application in the social category in many places around the world, which is like a very gratifying experience. I’m sure there’s a lot of many other games and chat applications that are seeing tremendous growth right now.

I think people have a very big problem, which is they’re isolated from their friends and their social circles. It’s very fulfilling to be one of the apps that can lend a hand in such a difficult time.

Shamanth: Indeed. I would say a lot of games we work with are absolutely seeing a surge in usage for the same reason, because people want to engage with games, people want an outlet for when they’re alone. And certainly I understand a lot of communication apps are seeing that exact same kind of surge. And I think you guys are at an interesting place because you are at the intersection of both those trends because people want to play games, people want to communicate, you guys have them do both. And I imagine that’s one reason why you guys are seeing such a huge surge.

Selcuk: Yeah, absolutely. Because basically, our thesis has always been like the best way to experience games with your friends as: one: in real time and second: face to face. So while we’ve seen over the past year or two, like the shift to a more real time multiplayer model around the world, even on mobile with games like Fortnight and PubG and Call of Duty and Roblox and Minecraft and Clash Royale. 

But then I think we’re more and more seeing the behavior happening in the US as well. And it was quite interesting because our thesis that we had when we started the company is people do play real time multiplayer games on their phone in Asia, especially in China. And then our thesis was that that behavior is going to migrate over to Gen Z in the United States. And we saw that over the past year. So like I say, our key user base was basically like the 15 year olds who play real time multiplayer games with their friends. But overnight, two weeks ago, like I would say, we went mainstream.

Some of the interesting changes in demographics were like this 15-16 year old Gen Z gamer became the 25 year old. Now we graduated from Gen Z to millennials, our user base was like somewhat evenly split with more dominantly male. Overnight, our user base became 62% female.

Shamanth: Do you think that’s because a lot of users discovered a lot of games for the first time when they’re indoors? Or do you think they were always playing games, but they discovered Bunch for the first time? What’s your sense about why this migration so to speak happened?

Selcuk: I think behaviors are changing, right? So people are discovering that they can do this stuff. I would say like a good corollary would be, I’d imagine, even post Covid, a lot of people are going to be doing more Zoom meetings. So a lot of people are probably going to be ordering more Postmates. So as those behaviors are changing, we’re basically seeing that people want to be close to their friends in a very meaningful way when they’re physically apart and they realize they can do that. 

So that’s going to be a sustained user behavior. And I think another basically key factor… and these are all guesses, right? Because like, we just have to make our best guesses. And I think another key factor is nostalgia. Yeah. And that was like one of the reasons why I built the company, right? Because a lot of our team –

we’re like a team of 16 people who grew up playing LAN parties and like Nintendo with our friends. So you play Mario Kart, or you play Counter Strike. And a lot of the fun is that like, the feeling of being in the same place, yelling at each other, or basically making fun of each other and having that camaraderie.



It sounds like they’re experiencing this for the first time, they’re experiencing this for the first time on their phones, right in such a frictionless way. So we’re not creating any new user behavior. We’re just tapping into existing nostalgia and existing behavior.

Shamanth: Right. That makes sense. And you did say Selcuk that you guys saw a surge in Italy. I’m curious though and perhaps Harsh can answer this because he’s more plugged into the data. I’m curious because Bunch is very reliant on liquidity. So for somebody who’s let’s say in Peru where, I know you guys are in the top 10 now, finds Bunch but they can’t use it by themselves, they need to have somebody to talk to. So you need some amount of liquidity. So when you start to take off in these countries, Argentina, India, Peru for that matter, do you start to get a sense of how that trend begins? What is your best understanding of how that happens? 

Harsh: Yeah, once they are discovering Bunch in those countries where Bunch had no impressions at all, we’re seeing that referral growth is growing, with word of mouth. So because these guys in these countries are staying back home so they have even higher intent of using a product like Bunch. So the onboarding, the activation rate we are seeing is almost 2x of what it used to be. 

Selcuk: We have some reason.

Harsh: We did not even change any flow in our onboarding nor change anything for activation. It’s all in product. It says that the (isolation from Coronavirus) problem has become bigger and Bunch is the biggest part of solving that problem. We’re seeing an increase in our referral traffic. We have seen people inviting more friends, people actually having more friends on Bunch, than they used to before.

Shamanth: Right and you did mention Selcuk the user base is skewing older just over the last couple of weeks. And Harsh you said the referral percentage is just going up. Do you also see other usage patterns that are different for the last couple of weeks compared to before?

Selcuk: Yeah, I would say maybe Harsh can correct me if I’m wrong on this. But like when we are looking at our iTunes connect traffic we’re seeing that, like over 60% of our incoming traffic is through search. Yeah. I would like to think a lot more than it used to be like we have like another like over 20% is basically through deep link referrals, which is like people who your friends invite. So and only like 5% which is basically kind of browsing. And that’s because we’re basically blowing up all over the world, despite any featuring on any app store. People are not like randomly discovering us, even though we’re in top charts in a lot of places. People come into Bunch with an intent they’re basically trying to solve this problem. They probably, for example, maybe were searching for group video chat app games, and they discovered HouseParty, they realized, like, the games were kind of like a tacked on there. And it was like the core part of the experience. They get bored. And then they discovered Bunch and they basically stick around. So that’s like a common behavior that we’re basically seeing or they hear about a Bunch from their friends or from the media, and then they come to Bunch with intent.

Shamanth: Interesting. So there’s a lot more people that are intentionally seeking out Bunch – as a percentage as compared to before. Right and yeah, so presumably, there’s referral traffic which is going up, presumably that word of mouth, is some people that get directly invited within Bunch. There are other people who presumably hear about it from their friends and go to the App Store and search for a Bunch. 

Selcuk: Yeah. 

Shamanth: Interesting. And Harsh. I think you briefly mentioned, you guys hadn’t changed much of the app itself, mainly because I imagine you wouldn’t have had a lot of time to build out features or change anything after you guys started to see the surge. So as both of you look at the product, drive the product, considering you have no time to build out any new features, how do you think about capitalizing on an opportunity like this?

Selcuk: Yeah. 

Shamanth: What if anything, are the short term low hanging fruit that you guys are thinking about – that could be product wise or marketing wise?

Selcuk: Yeah, I think we are working quite hard to keep the servers up. Like, that’s obviously a challenge because to be honest, yeah, I think we’re doing a pretty good job, but like, I don’t think any startup is prepared for this kind of effect, right, so, so we’re basically spending quite a bit of time making sure that players can have an optimal experience and if we have any outages or any issues, we apologize. 

We are really working as hard as we can to keep the service on optimal quality for every single player around the world. Having said that, we have some quite exciting capabilities that are in the roadmap, and like the very near roadmap, that a player is going to start seeing that is going to lead to more engagements, like more ways to connect with their friends. So we are basically investing into more content that’s going to be available in the application out of the box. And we’re going to be integrating this with more of their favorite games. So I think the users can expect to see higher quality, more content, more integrations and better ways to connect with their friends over the next months.

Shamanth: Cool. And on the marketing front, is there anything you guys can impact like an immediate short term, that could be like ways to double down on?

Selcuk: Right now, keeping up with demand. So we were just making sure that the people that were getting onboard are having a great experience. 

Shamanth: Yeah. Again, it’s a good problem to have, you don’t have to go seek out demand, because there’s enough people coming in. And certainly, since you mentioned wanting to make sure servers are up and running without any crashes or outages, I understand one of the things that can happen when you see a surge like this is services and infrastructure you’re using can start to get more expensive – that could be analytics, that could be tracking. To what extent is that impacting you guys? And to the extent you’re comfortable sharing, how are you guys thinking about this – well, we’re blowing up, now our expenses are also going to go through the roof.

Selcuk: It does impact my job and Harsh’s job more than the engineers because their heads down, like scaling stuff.

But then it’s been kind of crazy to kind of blow through the free tiers or low paid tiers of a lot of the analytics tools that we use. But the nice thing is a lot of these services offer programs to high growth startups to kind of reduce the immediate rush of pain that you can get from having to pay for these things. 

And we have several obvious ways to monetize the application. But again, that’s not like an immediate priority for us. I just want to get Bunch to as many people as possible and make it work seamlessly with as many of their favorite games as possible. So that’s like the priority for now. And like, luckily, we are a company that is quite well capitalized, because, it’s another kind of crazy coincidence. And so that happened where we only raised a bunch of money last year, like a year ago, but then in November, we got to raise a strategic round led by Supercell which, as you know, is one of the best multiplayer game developers in the world like they make Clash Royale and Brawl stars and things like that. And in that round, we had Riot Games that makes League of Legends, we have Miniclip that makes games like Agar.io, we have Tencent. So we are very lucky to be a startup that is well capitalized in like a very crazy environment that we are in right now. So again, it’s basically another reminder that like a lot of success in startups is basically trying a lot and then getting lucky a bunch. 

Shamanth: Yeah, but also capitalizing on that luck making sure you keep going through and that you double down on what is working, which is something you guys are very, very focused on right now. And speaking of which,  many apps that go viral oftentimes see a drop afterwards. And that’s most often because even though they see very high viral coefficients, people are sharing, people are referring their friends, they tend not to have downstream retention, that tends to be one of the more common causes why an app that goes viral tends not to stay that way. And so how are you guys thinking about ensuring that the current growth trajectory is sustainable?

Selcuk: Yeah, I think it’s a good question. I can answer that qualitatively and quantitatively. 

Shamanth: Sure. 

Selcuk: So one of the really interesting things that we’re seeing and may be Harsh to add more color to that is

normally as your app is going viral and getting like a huge influx of traffic, you would expect the drop in frequency right? Maybe this is because we’re a social network that is solving a significant problem. Our frequency and like retention is going up as traffic is growing.

So I’d say that’s one observation that would not fall true for all of apps that are going viral, that’s like the quantitative statement. Harsh, do you have anything to add to that?

Harsh: It’s always the case whenever you run influencer campaigns, you see like a big spike. And then what that does is you just get traffic which is gonna go down in the funnel, and your retention go down and your activation rates, everything goes down with that spike. But that’s not the case that we are seeing on our end. Like what we changed from our side, we were very much focused on user acquisition, and like always keeping an eye on engagement as well. That we are getting all this traffic. A lot of this has moved towards focusing on engagement as well and keeping an eye on the user acquisition that we have.

Shamanth: Interesting.

Selcuk: On the data side, I would add that

you see lasting behaviors in multiplayer games that are kind of behaving as social networks. There’s a reason why people still play League of Legends. There’s a reason why people still play Minecraft and Clash Royale. When you think about these real time multiplayer games where people experienced games together in real time with their friends, they’re essentially social networks on their own regard. That’s why people have been playing Minecraft for so long.

So yeah, we need virtual. And I expect that we will see similar lasting behavior on Bunch because for all that matter, it’s a very similar experience.

Shamanth: Indeed. So what I’m hearing you say is Bunch is taking a lot of these multiplayer games, which are already sticky – using Bunch makes them more sticky and that results in stronger engagement and retention numbers for Bunch just as well. And what the last couple of weeks has done, really, it has got much more users in the door. So the social density is more, the liquidity is more, like more people can engage more deeply with the app itself. Is that a fair understanding of how things are shaking up?

Selcuk: Yeah, absolutely.

It’s almost like when people are talking about product market fit. A lot of people change their products to fit our market. It looks like the market changed to fit our product in our case. 

Shamanth: Yeah, certainly. And Harsh, going over to you. I know this is your first product manager role. And correct me if I’m wrong. And I certainly remember when you first started at Bunch, because again, for the listeners who aren’t familiar with it – the three of us, we’ve known each other for a while now. So I’m curious what it’s been like for you, just in the last couple of weeks in your first product role to encounter growth like this?

Harsh: Yeah, it’s been crazy. Things changed completely when I began. So I joined as a growth intern and also the first employee and I got connected with you Shamanth. And then I moved my role from growth analyst/intern to Product Manager quite recently. But we were always focusing on the user acquisition side, like I mentioned, and the past two weeks, that is not at all an issue for us. Because, again, we’re just kind of solving this problem. But now, the entire product strategies are more focused on the engagement side, which is very interesting, because now that we have this opportunity of basically figuring out the app and the flows within the app and seeing how the users basically behave on the app. Now that we entered data, we’re trying to see what all things we can do on the product side to basically grow our engagement rather than user acquisition.

Selcuk: He gets to do growth hacking now.

Harsh: Yeah, I finally get into growth hacking.

Shamanth: Finally. Yes, indeed, indeed. And I understand Selcuk, you did mention you guys are well funded. Even though you don’t monetize, you’re funded by some of the biggest names in gaming. How did the last couple of weeks impact your future fundraise plans?

Selcuk: I will not comment, but just say wink wink.

Shamanth: I can conjecture that things are going to be very rosy with potential new investors in the future. Good places to be in. I’m happy for you guys. I’m excited for you guys. And I’m excited to tell your story on the mobile user acquisition show. Thank you for giving us a peek into everything you guys are going through everything you guys are experiencing at Bunch. And I think this is perhaps a good place for us to start to wrap up. As we wrap can you tell our users how they can find out more about you guys? And also about Bunch?

Selcuk: Yeah, they can go to the App Store on iOS and Android and search for Bunch. And hopefully, we are right up there. Or they can go to Bunch.live to learn more information as well.

Shamanth: Fabulous guys. Wonderful. Thank you so much for being on the Mobile User Acquisition Show. Selcuk and Harsh, it was a pleasure having you guys. 

Harsh: Thanks for having us.

A REQUEST BEFORE YOU GO

I have a very important favor to ask, which as those of you who know me know I don’t do often. If you get any pleasure or inspiration from this episode, could you PLEASE leave a review on your favorite podcasting platform – be it iTunes, Overcast, Spotify or wherever you get your podcast fix. This podcast is very much a labor of love – and each episode takes many many hours to put together. When you write a review, it will not only be a great deal of encouragement to us, but it will also support getting the word out about the Mobile User Acquisition Show.

Constructive criticism and suggestions for improvement are welcome, whether on podcasting platforms – or by email to shamanth at rocketshiphq.com. We read all reviews & I want to make this podcast better.

Thank you – and I look forward to seeing you with the next episode!


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