With Chinese apps out of the way (for however long), the war for Indian content platforms has not ended. If anything, it has just begun. Most video content platforms are seeing an uptick in daily active users. Question is who will retain them?

Virtuous loops for UGC platforms start with creators. Best content platforms will find interesting ways to attract and promote creators. Think:
a.Creator tools
b.Migrating existing followers
c.Quickly getting new followers
d.Getting more content views, faster

Tiktok for example has a stream of videos that combined the creators one followed with those they didn’t, helping creators get views outside of their direct followership. ‘follow’ button on the main page itself, made it very easy for a viewer to start following a new creator

Another characteristic of successful UGC platforms is that they end up owning a content format and become the go-to place for the format - Youtube for short-form video content, Tiktok for very short-form video and Twitter for very short form text

The best products retain users by getting associated with a trigger. All habits need a trigger. Nescafe as a brand created a habit by associating itself with the trigger of “waking up” – Remember? ‘Taste that gets you starting up…’

Youtube has multiple triggers. People go to YT for “how-to” content, need for entertainment, for learning and increasingly for live content/events. You are gold if the trigger for your platform lends itself to multiple sessions a day

Platforms with high daily frequency are habit-forming and as such, manage to scale fast and dominate for a long time – habits are hard to break. Such platforms also lend themselves to ad monetization. Scale is especially important for ad monetization in India where CPMs are low.

Here’s a back of the envelope math for ad-based monetization. The higher the frequency of visits, the more impressions a platform can generate. I’ve assumed an aggressive fill rate here and CPM is ballpark too

If the product has low daily frequency, one should go for premium models. This approach works if you choose a niche that requires a certain degree of expertise and quality from creators and where content becomes the platform’s IP (PUGC/PGC + Paid)
E.g. Netflix, BYJUs, Unacademy

As an investor, in the UGC category, I care most about how freq of visits is trending and how time-to-first-follower (for a creator) is trending. In the PUGC/PGC category, I’d look for early signs of monetization. The middle is dangerous – low freq with low willingness to pay

As I think about this more, opportunities in UGC in India are probably many. A simple 2/2 for video reveals gaps. If one adds other dimensions like content type (text, audio, gaming, AR/VR) and user segments, there is clearly a long way to go!