Looking back at ChinaBang: Momo – Company of the Year 2014

TechNode has been organizing the annual “China Bang Awards” since 2011. Over the past few years, TechNode has witnessed a large number of emerging startups grow into unicorns. For the upcoming ChinaBang Awards 2018, TechNode has started a special report to review the history of China Bang Awardees.

Momo is an app which you may never want to use, but which you can’t go around when talking about mobile social networking.

Because Momo, or all the user pain points it discovers, is always there, undiminished. The company was voted ChinaBang’s Company of the Year and one of the best gaming companies in 2014. It had already been China’s third-largest homegrown social messaging giant next only to Tencent. When interviewed backstage at ChinaBang that year, Momo’s COO told us that Momo derived its revenue from premium membership subscription, mobile gaming, and stickers. Now, the latest financial results show that nearly 80% of its revenue comes from live streaming. Along with it are perceptions of Momo having gradually been changed from the “magic hookup tool” to a live streaming platform.

The author, though not a core user of Momo, heard of the reputation of this hormone-filled app which, frankly, did not make a good impression on me. Yet, I felt a little surprised when news came out of Momo’s acquisition of smaller rival Tantan—is Momo still that “indecent” flirting app in our minds? Or has it morphed into a resourceful social empire?

Indeed, Momo has been striving to embody the yearning and curiosity of hundreds of millions of people for getting connected with strangers, as well as attracting and linking people who have similar interests and common values. 

Rome was not built in a day, and neither will Momo’s goals be met. Momo has been working hard on this and has never ceased its exploration—from live streaming to short videos to paid memberships. Today, we will piece together a timeline of Momo’s major events in recent years.

Momo debuted in August 2011 merely as a location-based social app for strangers. With the launch of version 1.0, the app enabled users to find people nearby, check out their profiles, as well as follow and connect with them. As the geo-location service makes it much easier for users to date strangers, Momo had considerable success in encroaching on the share in the instant messaging market dominated by QQ, which at that time, focused more on promoting users’ existing networks than offering options to find new friends. QQ was once the biggest social media network in China before the emergence of its younger sibling Wechat. Both QQ and Wechat are the brainchildren of Chinese internet giant Tencent.

Momo began to see a surge in user numbers since then. By catering to the basic desires of people at the outset of its creation, Momo has started its growth and gradually expanded its presence into broader domains of social networking services.

When its monthly active users (MAU) reached about 40 million in 2013, Momo started monetizing its user base. Learning from Tencent, it launched its first mobile game that year. Based on Momo’s original social networking system, players can see the rankings of their friends, those of people nearby and in other cities, and add friends. Momo announced in February 2014 that the number of its registered users surpassed 100 million.

In late 2013, Momo officially launched a new model to explore the commercialization of social gaming—the introduction of its value-added services just like the QQ membership system of that year. At the end of 2014, Momo was listed on NASDAQ, accompanied by a crowd of investors and CEO Tang Yan’s iconic gesture.

While Momo’s business model of membership subscription and valued-added services continued its strong momentum in 2015 and 2016, its stranger social networking began to lose traction. Momo had to pin hopes on new stimulus to re-ignite the passion of its old users. The social networking app, which saw its total registered users and MAU reach over 100 million and 55 million respectively, jumped on the bandwagon of the live streaming boom in 2016, a banner year for live video streaming. It launched its KOL live streaming service in December 2015, and rolled out major updates in April 2016, featuring live streaming as a separate tab.

Momo’s social networking attributes, coupled with a stable pyramid structure of its user base—at the top are internet celebrities skilled in singing and dancing, huge number of young females follow and multitudes of diaosi (a slang term that refers to young “loser” Chinese males) are at the bottom—have made the app a platform born for live streaming. This is clear in its cash flow: The financial report at the end of 2016 showed that live streaming business has become Momo’s primary growth driver.

It is worth mentioning that Momo added an anonymous like function called diandian (点点 ) in its 6.0 version, which recommends a number of users nearby based on the geographical location of a user. The user can swipe left if he’s not interested and swipe right to “like”. If both parties like each other, they can chat directly online. At that time, a similar feature on social app Tantan had won favor among youngsters as well, helping the Tinder-like app gain ground and secure a $70 million funding led by online social entertainment firm YY in 2017. In a scramble for more shares in the live streaming market, Tantan was also a formidable rival to Momo.

As live streaming services have become a strong growth engine for Momo, it released version 7.0 in August 2017, enriching its live streaming. By adding myriads of features including live group video broadcasting, one-to-one random video chat, talent contests, 3D video recording and AR selfie editor. All these gimmicks signal it’s ready to embrace the social video times and gearing up to grab more market shares.

During its repeated revamps, Momo, while switching from a mere LBS dating app to a pan-entertainment live streaming and social platform, quietly changed the color of its logo from a blue smacking of Facebook to colorful shades and replaced the old slogan of “There’s always something new around” with a new one—” Video social networking, always Momo”.

From this we can observe that Momo has taken the opportunity to upgrade its brand and bring a brand-new image to its users, displaying inclusiveness and infinite possibilities with the launch of diversified, youth-targeted and video streaming-focused product lineups. To put it more succinctly, by changing the slogan, Momo managed to deepen focus of the public to “interest”, “making friends”, “fellow townsmen” and “entertainment”, thus weakening the negative perception of “hookup.”

However, there’s no getting around “hookup”—people’s primal urge, no matter how Momo changed its logo or app style, or what features it introduced in building its social empire. As the live streaming boom may gradually recede, it seems that Momo’s social video networking road ahead is not easy. Momo, which derived nearly 80% of its revenue from live streaming in Q4 2016, is in need of new stimulus. What will happen this year? And what alternatives will Momo look for? One answer may be the big-ticket acquisition of Tantan. This may inject vitality into Momo’s stagnant stranger social networking business, the importance of which it has somehow played down in recent years.   

—Translated by Sheila Yu