August 17, 2014 3:00 pm

Venture capitalists back anonymous apps

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Ask fm©Getty

“I only brush my teeth when I go to the dentist”, “just spent almost two hours in the shower talking to my dad who passed away three years ago” and “my husband thinks I’m saving money for a trip. I’m really saving it to leave him”.

These are just a handful of the confessions found on a new wave of anonymous apps, which are trying to challenge social networks such as Facebook and Twitter to create a place on the internet where people can truly be themselves.

The acquisition of Ask.fm last week by IAC, the owner of Tinder and Ask.com, was the latest sign of the increasing popularity of anonymous sharing online.

While Ask.fm is the best-known example, venture capitalists have put tens of millions of dollars into competitors such as San Francisco-based Secret and Los Angeles’ Whisper.

Doug Leeds, chief executive of Ask.com, says Ask.fm has 180m monthly active users and is on its way to becoming as large as Twitter, with 271m.

In the US, 9 per cent of 10- to 18-year-olds use Ask.fm and 5 per cent use Whisper and Secret, according to data from research company eMarketer.

“Anonymity is ingrained in the human experience but hasn’t been in social apps until now,” Mr Leeds says. “There have been confessionals, police tips lines and Dear Abby columns in the newspaper.”

But all of the anonymous apps – and Ask.fm in particular – have to deal with the problem of cyber bullying and unsavoury content before they can become a venue for mass-market brands to advertise.

About 40 per cent of the audience is under 18, an audience that advertisers crave a way to connect with, and many use the app intensively.

Mr Leeds is on a mission to clean up Ask.fm, which was criticised by British prime minister David Cameron for not clamping down on cyber bullying, by improving moderation.

“There is a massive audience that is very engaged and very attractive to advertisers – assuming it is cleaned up, with no bad content to make it safe,” Mr Leeds says, after striking an agreement with New York attorney-general Eric Scheiderman promising to respond more quickly to abuse.

Whisper, which has a slightly older and very female audience, employs 130 moderators, with people on 24 hours a day, who work to make sure no proper names are used on the platform or nude photos posted.

Michael Heyward, co-founder and chief executive of Whisper, says he “overstaffed” moderation to create “the safest place on the internet” so people will share their innermost thoughts.

“The key motivation behind posting on Facebook, Instagram, LinkedIn or Twitter is showing the best version of yourself, whether you’re on a vacation or at a party,” he says. “But there’s this huge space, all the experiences people have and don’t really share.”

Whisper has been used by artists to share their pictures for honest feedback, a soldier who wanted to share his day anonymously and college students looking to understand if they are the only ones who have never been kissed.

Secret has taken off in Silicon Valley where it is often used to share gossip about the technology industry.

[Anonymous apps address] a very important human need: the freedom to share our true thoughts anonymously and without fear of judgment

- Danny Rimer, Index Ventures

Posts to the app revealed that Nike was shutting down its fitness-tracking Fuelband unit and the imminent departure of prominent Google executive Vic Gundotra.

But it is also very popular in Israel and Russia, where it is used for more political discussions, growing fast in Brazil and Mexico, and has a joint venture in China, where Facebook and Twitter are banned.

Danny Rimer, an investor in Secret at Index Ventures, says in a blogpost about the start-up’s $25m fundraising last month that it addresses “a very important human need: the freedom to share our true thoughts anonymously and without fear of judgment”.

Secret, unlike Whisper, lets users communicate with unnamed friends from their Facebook or phone contacts, giving it an additional level of intrigue, relevance and virality.

Like many social networks before them, Ask.fm, Secret and Whisper are focusing on attracting users before figuring out how to make money from them.

But creating a clean environment is not the only challenge for anonymous apps looking to court advertisers.

Social networks have sold themselves as mines of data on their users, allowing marketers to target ever more specific audiences – which anonymous apps do not have.

However advertisers have experimented with both Whisper and Secret. Whisper has tested native advertising with MTV and Hulu, the online streaming service, and some brands have encouraged people to share “secrets” about their brands.

Ben Winkler, chief digital officer at Omnicom’s OMD advertising agency, says he has already introduced clients to Secret and Whisper.

“There is a legitimate appeal to anonymous apps – they’re local, mobile, social, young and, most importantly, authentic.”

Other uses include companies where employees are encouraged to talk honestly about their workplace on Secret, services which the start-up could charge for one day.

More established social networks are watching closely. Facebook wants to own a stable of apps and has already tried to create apps focused on other new areas of social media, most obviously with bids to emulate Snapchat’s disappearing photo messages and acquire the company.

Jeremy Liew, a partner at Lightspeed Venture Partners, an investor in Whisper, says he thinks Facebook, which has always pushed people to use their real identity, would struggle to create an anonymous space on its network.

“For them to try to embrace anonymity or pseudonymity is fundamentally incompatible with what a Facebook brand means,” he says. “It’s fine to try but I can keep trying to play NBA basketball all I like, but I’m still 5 foot 8.”

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