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At VidCon, Investors Are Still ‘Betting Big’ on the Creator Economy
Kristin Snyder
Kristin Snyder is dot.LA's 2022/23 Editorial Fellow. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.
The creator economy is the bedrock of this week’s VidCon convention, which is drawing creators, companies, investors and fans alike to Anaheim to discuss the rapidly growing realm of digital content and entertainment.
To discuss how investors, in particular, are viewing the booming creator landscape, Thursday’s “Betting Big on the Creator Economy” panel featured the likes of MaC Venture Capital partner Zhenni Liu, Investcorp managing director Anand Radhakrishnan, Team8 Fintech managing partner Yuval Tal and Paladin co-founder and CEO James Creech.
Liu said that her Los Angeles-based VC firm is paying closer attention to the influence that creators are having on how consumers spend their time and money. She cited the recent “healthy Coke” viral trend, in which people mix balsamic vinegar and seltzer water as a soda alternative, as an example—citing how the number of people who have viewed the original TikTok video that set off the craze surpasses the Coca-Cola TikTok account’s number of followers.
This growing influence stems from the surging number of creators, Radhakrishnan said. With the pandemic forcing many to reconsider their career paths, he said people now view content creation as a legitimate professional route—quipping that these days, more children want to be YouTube stars than astronauts.
“As an older person, I thought this was the downfall of Western civilization,” the Investcorp managing director said. “At the end of the day, I think it reflects that this is real—and as an investor, we’re looking at ways to invest in the next great economies.”
Creech said that the growing creator sector rests on three main pillars: content creation, audience growth and monetization. The constant evolution of creator platforms does present a challenge for investors, however, with Liu noting that more creators are looking to Web3 as an alternative to traditional outlets often offering a smaller slice of revenues.
“As a result, we’re seeing creators who can’t figure out how to build their audience, monetize and distribute,” Liu said. “With Web3, this opens up a new opportunity. There's a lot of chaos, but chaos provides the opportunity for creators to rise up.”
Additionally, the shift toward short-form content means that more investment dollars will be redirected away from longer-form shows and films, Tal observed. And even with an increasingly likely recession on the horizon—one that already appears to be hitting the creator economy, as well as the wider tech, startup and venture capital sectors—Tal and the other panelists remained optimistic about the creator economy’s prospects moving forward.
“It is almost winter-agnostic,” Tal said. “The shift [toward the creator economy] is so massive that no [economic] winter can slow it down.”
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Kristin Snyder
Kristin Snyder is dot.LA's 2022/23 Editorial Fellow. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.
https://twitter.com/ksnyder_db
Billion-Dollar Milestones and Snapchat’s New Features
11:30 AM | October 25, 2024
🔦 Spotlight
Happy Friday Los Angeles!
This week’s spotlight showcases LA’s thriving tech scene, featuring Snapchat’s latest feature updates and two local startups Liquid Death and Altruist, making TechCrunch’s Unicorn List for 2024.
Image Source: Snap
Snapchat’s recent fall updates bring fresh features, including a new iPhone camera shortcut for instant snaps, Halloween-inspired AI-powered Lenses, and Bitmoji costumes inspired by Mean Girls and Yellowstone. Bitmoji stickers now reflect trending Gen-Z expressions like “slay” and heart symbols for added flair in chats. Plus, the “Footsteps” feature on Snap Map allows users to track their past adventures privately, adding a nostalgic touch.
Image Source: Liquid Death
ICYMI, two LA startups joined the Unicorn Club—achieving valuations over $1 billion. Liquid Death, based in Santa Monica, is a canned water company with edgy branding and a humorous sustainability focus. Known for viral marketing and brand partnerships, it redefines bottled water as a lifestyle brand and environmental statement. In March, Liquid Death closed $67 million in strategic financing, raising its total funding to over $267 million and valuing it at $1.4 billion.
Image Source: Altruist
Altruist, a Culver City-based fintech platform, offers financial advisors streamlined tools to better serve their clients. With a user-friendly investment and account management platform, Altruist has gained strong traction in the finance world. In May, it announced a $169 million Series E funding round, bringing its total funding to over $449 million and earning a valuation of $1.5 billion.
Together, Liquid Death and Altruist exemplify LA’s capacity for innovation across diverse sectors, from lifestyle branding to fintech. Whether reshaping financial tools or redefining sustainable branding, these companies showcase LA’s unique entrepreneurial spirit. Go LA!
Check out TechCrunch’s 2024 Unicorn List here. And don’t miss Snapchat’s latest features—perfect for adding some fun, connection and maybe a few selfies this weekend!
🤝 Venture Deals
LA Companies
- Carbon Ridge, a developer of carbon capture technology for the maritime industry to reduce ship emissions, has raised $9.5M in a funding round led by Crosscut Ventures and Western Technology Investment (WTI). This investment will help accelerate the decarbonization of maritime shipping. - learn more
- Freeform, a company bringing AI to metal 3D printing, raised $14M in funding from NVIDIA’s NVentures and AE Ventures to further develop its AI-powered 3D printing technology for industrial-scale production. - learn more
LA Venture Funds
- Anthos Capital participated in a $70M Series D round for Carbon Robotics, which develops AI-powered robotics for precision agriculture, and the funding will be used to accelerate the growth of its autonomous weeding technology. - learn more
- Anthos Capital participated in a $3.5M seed round for Plasma Network, aimed at expanding access to USDT stablecoins on the Bitcoin network, with the investment supporting the network’s growth and efforts to enhance stablecoin accessibility through the Lightning Network. - learn more
LA Exits
- Grandview, a literary management company representing top talent across various entertainment sectors, has been acquired by TPG’s newly formed entertainment venture, Initial Group, in partnership with Untitled Entertainment. - learn more
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A Breakdown of the Data Snapchat Collects on Users
09:46 AM | November 14, 2022
Sebastian Miño-Bucheli
Santa Monica-based app developer Snap calls itself a camera company, but it’s really in the business of social media – and more specifically, advertising.
What Data Does Snapchat Collect?
Snapchat, their primary application, collects a myriad of data on its roughly 363 million daily active users, from basics like device information to detailed location tracking. "From day one, we’ve embraced data minimization, and believed that the best way to protect user privacy is to not store data at all, and if we do have to store it, to do so for a short and fixed period of time," Snap spokesman Pete Boogaard told dot.LA.
As such, like most tech companies’ privacy policies and terms of service, the verbiage is intentionally vague or full of legalese designed to make the user gloss over and click “agree.” But Snapchat does have to provide its users some details of how it collects, stores, and uses the data it gains from interacting with the app.
Bill Budington, a senior staff technologist at the Electronic Frontier Foundation, told dot.LA that the common phrase, “necessary to provide service,” is particularly concerning.
“These are very vague ways to basically give a green light to very permissive practices in terms of your data,” Budington explained. He pointed out the ambiguous nature of the word “necessary,” adding, “[tech companies] can deem all sorts of things necessary, [including] using your location at every moment to better tailor their services to your life.”
While Snapchat’s terms of service haven’t changed since last November, the company most recently updated its privacy policy on July 29. Let’s dive into the various types of data Snapchat collects, how it stores it (and for how long), and perhaps most importantly, how Snapchat says it’s used.
Why Does Snapchat Collect Your Location Data?
Snapchat is very invested in collecting users’ precise location data, if users allow it. Its Snap Maps feature launched in 2017 lets users opt-in to showing their Bitmoji avatar on a map corresponding to their location and also allows them to track other friends who have opted in. It’s not dissimilar to Apple’s FindMy app.
In the past, the feature has raised concerns for its ability to make it easier for bullies and stalkers to find targets. Snap Map location, however, isn’t public information. Snapchat says location on Snap Maps will disappear after 24 hours, or when a user deliberately goes into “ghost mode” to hide from friends – but that doesn’t mean the app still isn’t tracking their movements. The company noted that unless you opt-in to live location sharing, the Snap Map won’t update with your location when you’re not actively using it.
Boogaard told dot.LA that while many of Snapchat’s core features do require location tracking, “location-sharing is off by default for all users” and “Snapchatters have complete control over their location sharing.” Snapchat added that there is no option to share your location with any user you aren’t friends with and that users have to individually select friends to share their location with.
Snapchat clarified that it does use location data to provide its Geofilters – custom photo and video filters often themed around specific places or events – and show people what’s nearby (also useful for ad purposes).
“We don’t share personal data about the users of the Snapchat app with data analytics providers,” Boogaard said.
Snapchat employees can also allegedly access all this information, and more – in 2019 Motherboard reported on a tool called SnapLion that it claimed was abused by employees to “spy on users.” In response to the report, Boogaard told dot.LA, “Any perception that employees might be spying on our community is highly troubling, and wholly inaccurate." Boogaard added, "Protecting privacy is paramount at Snap. We keep very little user data, and we have robust policies and controls to limit internal access to the data we do have, including data within tools designed to support law enforcement. Unauthorized access of any kind is a clear violation of the company's standards of business conduct and, if detected, results in immediate termination."
How Does Snapchat Use Your Content?
Snapchat can see the snaps you send, who is receiving them, and how often you’re online, as well as the metadata in each image.
Snapchat’s Streak feature (which tracks how long you and friends have regularly been sending and opening each other’s content) is one reason why the app also collects data on how often you and your friends open messages or capture screenshots.
It also tracks and scans the content users upload to its Memories feature. This is to train its AI to recognize the content of user images. In its privacy policy Snapchat notes that “if there’s a dog in your photo, it may be searchable in Memories by the term ‘dog,’” as part of its goal to make image search more accessible.
Snap’s policy also dictates that any public content a user generates on Snapchat is also fair game for the company to share though it doesn’t say how it will share this content.
What Data Does Snapchat Collect From Accessing Your Camera?
Besides the typical use for taking pictures, Snapchat can also access information from Apple’s TrueDepth camera – the front-facing, high-powered cameras that Apple’s iPhone X uses to record Face ID and Memoji data.
Snapchat says it uses this data “to improve the quality of Lenses”—its filter and augmented reality feature. But it also said it doesn’t collect biometric information, much less store the data on its servers or give it to any third parties.
Still, that’s a practice that’s come under scrutiny recently. In August, Snap was sued, accused of violating Illinois’ Biometric Information Privacy Act by collecting and storing users’ biometric data without their consent. That $35 million case is expected to head to settlement next week, after a judge couldn’t rule in favor of either party. "Snap continues to vehemently deny that Lenses violate BIPA, which was designed to require notice and consent before collecting biometric information used to identify people," Boogaard told dot.LA.
How Does Snapchat Use Your Data?
Now that we know all the information Snapchat collects, what is the company doing with it?
The main use case is advertising. Snapchat has a myriad of advertisers on its platform and they are all eager to turn users into sales by showing them the most relevant ads. Ad pricing starts at a modest $5 per day, so theoretically anyone with a marketing budget and the right connections could use Snap’s tools to market to its growing audience of Gen Z and Millennials.
Snapchat promises advertisers “advanced targeting capabilities,” and the benefit of finding a target audience using its location, demographics, interest and device data.
But who’s getting this information? That’s where things get vague. Snapchat doesn’t have to tell users specifically which companies are getting access to their data. The company notes it may share information with service providers that it contracts for services like ad analytics or payments. The company also says it might share user information with “business partners that provide services and functionality” for Snapchat, but again, doesn’t elaborate any further.
Snapchat also says it will share information about users if it could help “detect and resolve any fraud or security concerns, comply with any investigations, legal processes or regulations and to investigate potential terms of service violations.”
Snapchat doesn’t have to tell users when it turns over this data, though. In fact, most apps don’t.
How Does Snapchat Store Your Data?
Snap’s Support site notes Snapchat servers are designed to delete all Snaps automatically after they’ve been viewed by every recipient; the app’s trademark fleeting quality. The servers will delete unopened Snaps between two people after 31 days, and unopened Snaps sent to a group chat after 7 days. Snaps sent to your story are wiped from the servers 24 hours after posting.
Snapchat also says that when you delete a Snap in chat, it deletes it from its servers and will “make our best attempt” to wipe it from your friends’ devices.
If you post a Snap to Memories, though, Snapchat’s servers will back them up forever – unless you delete them, in which case they’ll be erased ASAP.
So what’s the safest way to protect your personal information on Snapchat? Well, Budington recommends an easy fix: simply don’t use it. But for people who are determined to keep their account but want to access what Snapchat collects, there are ways to download your Snapchat data.
You can also opt-out of audience and activity-based ads and third-party ad networks. This will mean the ads on your Snapchat will be less relevant, but the trade-off is that the app will use less of your personal data for marketing purposes.Snap is an investor in dot.LA.
Correction: An earlier version of this article incorrectly described Snap Map's location tracking feature. The feature needs to be enabled first, and Snapchat offers the ability to turn off the feature in Map settings.
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Samson Amore
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
https://twitter.com/samsonamore
samsonamore@dot.la
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