With 1 Million Daily Users, Group Video App Houseparty Could Overtake Snapchat In Race To Attract Post-Millennials

By Yonatan Sredni, NoCamels December 14, 2016 3 minutes

House Party App. Courtesy

Thanks to countless scenes in movies and television shows, the term “house party” often conjures up images of wild, loud teenagers partying hard at some popular kid’s home while his or her parents are away for the weekend.

But for millions of Generation Z (Gen Z, or Post-Millennials) teens, those born anywhere from the mid-1990s to the early-2000s, Houseparty is simply the name of their favorite video chat app. Even prestigious magazine Forbes has said this new Israeli app is winning over Generation Z, in an article titled “Move Over, Snapchat.”

Houseparty, created by Israeli startup company Life on Air, allows users to quickly jump into “parties” of up to eight people simultaneously, creating drop-in-drop-out style video chats among any friends who are online at the same time. The idea behind the app is to create a virtual space where you can hang out with your friends—a “house party” – where everyone you know is invited. When a friend loads the app, you’ll get a notification letting you know they’re in the house. If you want to chat, you launch the app and join.

Chats are organized by room, and anyone you’re friends with on the app has a virtual invitation to drop in on your conversation. Their friends can also join, in which case you’ll see a “stranger danger” message. Beyond that, it’s pretty much like any other party, where you can freely chat with friends. Up to eight people can be in a room at the same time, and you can casually move between rooms to interact with different groups of friends. When you want to prevent people from joining a private conversation, you can simply lock the room.

$52 million raised

Life on Air was founded in 2011 with headquartered in San Francisco and R&D in Tel Aviv. CEO Ben Rubin and COO Sima Sistani recently created the app Houseparty. Life on Air this week announced it has raised $52 million for Houseparty. The financing round was led by Sequoia Capital with the participation of previous investors Aleph VC, Comcast Ventures and Greylock Partners. The company has raised $70 million to date and The Wall Street Journal reported that the venture capital funds were competing to invest in this latest financing round.

From Meerkat to Houseparty

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Houseparty is not the first app created by Life on Air. Their first product was live-streaming smartphone video app Meerkat, which launched in February 2015 and managed to generate lots of excitement initially, but eventually failed after being frozen out by social media giants Twitter and Facebook.

Twitter blocked Meerkat’s access to launch its own live-streaming app, Periscope. Facebook built live streaming into its mobile app, which has more than 1 billion monthly users, a few months later. Meerkat, which suddenly found itself was in a three-way battle against two huge companies with significantly more resources at their disposal, simply couldn’t compete.

The team quickly regrouped and Houseparty was released in early 2016. The new app has quickly emerged to the top of the mobile app charts to become what many are calling “the next big social network,” currently with 1 million daily active users. The Houseparty app is currently free and there are no in-app purchases that require you to spend money to join or host a Houseparty. However, it remains to be seen if the company decides to charge users in the future.

Attracting Generation Z: 60 percent of the users are under 24

Naturally, Houseparty’s target audience, and its primary users, are Gen Z, the next generation after millennials. A whopping 60 percent of the app’s users are under the age of 24.

“We’re constantly amazed by how many people reach out to us to let us know how much Houseparty is strengthening their friendships and family relationships,” Sistani told Forbes. “It’s a great feeling when you get to connect with a friend or loved one, or better yet, multiple friends and loved ones, totally unexpectedly. And we love to hear about how people are making Houseparty a part of their daily routine, whether it’s getting together with their squad to recap the latest episode of a favorite show, dealing with homesickness by cooking a nostalgic dinner ‘with’ your mom or dad, or reliving all the gory details of a rowdy night out with your best friends.”