TikTok and Threads Won Because They Solved Distribution
TikTok paid for creators and viewers at once, and Threads borrowed Meta's audience, at a time when getting anyone to try a new app is harder than it was.
Lenny's Podcast: Product | Growth | Career · Snapchat CEO: Why distribution has become the most important moat | Evan SpiegelEvan Spiegel, Snapchat's chief executive, says consumer startups obsess over the wrong question. They ask whether they built the right product, what tech people call product-market fit, when the harder problem is distribution, meaning getting people to find and try the app.
Since Snapchat launched 15 years ago, almost nothing durable has broken through except TikTok and Threads. TikTok is more of a media platform than a social one, and Threads sits on top of Instagram.
When Snapchat arrived, people were far more willing to try new apps. Spiegel said, "The mobile phone and the App Store were just getting started," so people "were downloading lots of new apps all the time." People "were really excited about trying new services," he said.
People are downloading fewer apps now. Spiegel said, "People aren't downloading as many apps now as they used to," so it is "a lot harder to get distribution for new ideas and new services."
TikTok solved that with money, which Spiegel calls innovative. Spiegel said it "spent billions of dollars subsidizing both sides of" its video marketplace, acquiring viewers to watch videos and paying creators to make them. With supply and demand in place at once, the system could bootstrap itself.
Threads used the users Meta already had across its other apps, borrowing them instead of building an audience.
Spiegel's point is that building the right product gets most of the attention, while the hard part is getting creators and viewers together at once.
Questions people ask
Why did people stop downloading new apps?
Phones matured and home screens filled up, and most daily needs are already covered by a few familiar apps. App stores also shifted from novelty and charts toward search and habit, so discovery is weaker. The result is that incumbents keep attention by default.
How did TikTok actually pay for both sides?
On the creator side, TikTok used creator funds, bonuses, and ad revenue sharing to reward posting. On the viewer side, it spent heavily on advertising, app-install ads, and referrals to pull in watchers. Once both groups were present, recommendations and network effects could take over.
What did Threads borrow from Instagram exactly?
Threads let people sign up with their existing Instagram account and carry over their username and follows. That removed signup friction and seeded the new app with familiar faces on day one. It is the same shortcut as opening a new store inside a mall you already own.