Yik Yak

What did it do?

Yik Yak was a mobile app that let users post under a pseudonym or anonymously to people within a radius of roughly 8 kilometres. It spread above all on university campuses, where posts rose or disappeared according to users' votes. The Atlanta-based company was founded by Furman University graduates Tyler Droll and Brooks Buffington.

Why did it shut down?

Rapid growth came with fierce criticism that the app was being used for racism, antisemitism, sexism and cyberbullying. In March 2014 the company used geofencing to block the app at middle and high schools, but the problems on campuses persisted. In 2016 usage fell by 76 per cent year on year, and in December 2016 60 per cent of staff were laid off; Ars Technica wrote that the company still had no business model. In April 2017 Square bought the intellectual property and some of the engineers for about $1 million, and the app stopped working on 5 May 2017.

The story

Tyler Droll and Brooks Buffington started working together at Furman University, in a class where they learned to build iPhone apps. After graduating, Droll gave up on starting medical school and Buffington put his finance career on hold. Yik Yak, which they released in November 2013, let users post anonymously to anyone within roughly 8 kilometres. Twelve months later it was the ninth most downloaded social media app in the US.

Working out of Atlanta Tech Village with early backing from Atlanta Ventures, the company spent 2014 raising round after round. In April it took $1.5 million from investors including DCM and Azure Capital Partners, and in June $10 million in a round joined by Tim Draper. In the autumn more than $60 million came in from Sequoia Capital and others. According to The Verge, the company was at one point valued at $400 million.

Anonymity fuelled rapid growth on campuses, but at a heavy price. The app was repeatedly criticised in the media as a vehicle for racist, antisemitic and sexist posts and for cyberbullying. In March 2014 the company drew invisible geofences around middle and high school buildings to disable the app there; an article published in the Huffington Post argued that universities should ban it. In December 2014 security researchers showed that an attacker on the same Wi-Fi network could unmask a user's identity. Allegations that the company quietly deleted some posts through downvotes without users noticing also eroded trust.

User loyalty began to unravel. In 2016 usage fell by 76 per cent year on year, and in December 2016 the company laid off 60 per cent of its employees. On 28 April 2017 Yik Yak announced it would shut down; the payments company Square bought its intellectual property and some of its engineers for about $1 million. The app stopped working on 5 May 2017. The brand was relaunched by a new team in 2021, but the original company's story had ended in 2017.

Yik Yak is a reminder that a community's culture is shaped by the product itself. An anonymous platform that does not put moderation and trust at the heart of its design can drive away its own users as it grows.

Lessons for founders

• If you are building an anonymous or location-based community, grow your moderation team and reporting tools as fast as your user base.
• Spending investment on growth before the revenue model is clear leaves the company exposed the moment usage drops; test a revenue hypothesis from day one.
• In closed communities such as campuses, reputations spread fast; engaging early with university administrations reduces the risk of bans and backlash.

Sources

1. Yik Yak (Wikipedia)
2. Yik Yak, once valued at $400 million, shuts down and sells off engineers for $1 million (The Verge, 2017-04-28)
3. Yik Yak shuts down after Square paid $1 million for its engineers (TechCrunch, 2017-04-28)
4. https://www.wikidata.org/wiki/Q18216046
5. Wikipedia (English)

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