Breaking Down Lunchclub: The Latest Virtual Networking Tool
By now, many of you have probably heard of Clubhouse, one of the newer social media tools to launch during the COVID 19 pandemic. If you haven’t, this article gives you a good overview of the platform. While Clubhouse has steadily taken off over the past few months, you may have noticed how difficult it can be to engage in the discussion. If you want to listen to people opine about topics you care about Clubhouse is great, but can be less so if you want to speak and be part of the discussion.
The latest entrant into the social media sphere, Lunchclub, attempts to solve that. With this platform, you actively engage in discussions with peers, people with similar interests, or someone that just seems like they would be a good person to chat with. Having used it twice myself as I write this, I think there is tremendous potential with the concept.
But how exactly does it work? Is it something that is here to stay once COVID 19 is in the past? Perhaps most importantly, what are paths to monetization for the founders?
We’ll get into all that here. To start things off, let’s dissect exactly what this new social media platform does.
So, what is this Lunchclub thing anyway?
Initially, Lunchclub was launched in 2018 as an invite only service for in-person introductions. Then, their entire aim was to bring two people together for an in-person conversation over lunch or coffee. People would fill out questionnaires to help Lunchclub’s algorithm get to know them better and help match them with interesting people who they could meet. As founder Vlad Novakovski put it, “our goal is to make meetings more relevant. A salesperson might find a dozen prospects on another platform, but our algorithm identifies the one prospect that will be interested, saving valuable time.”
Then 2020 the COVID 19 pandemic happened, forcing everything to shift to virtual formats. Lunchclub then pivoted to using Zoom chats and Google Hangouts so people could keep meeting other people. They also dropped the exclusivity as well, and in doing so membership took off - they currently have close to half a million users and just recently booked their 1 millionth match. Venture cap firms are taking notice - currently valued at over $100 million, they just raised $24.2 million in an equity round.
So practically, what does it take to sign up and use the platform? Well first, you can log onto their website or download the app (either is fine) and create your profile. You will tell the algorithm your interests, types of people you would like to meet and create a short little bio about yourself (this gets shown to prospective matches, so be thoughtful about what you say here).
Then everyday, Lunchclub will throw at you a set of 10 prompts designed to help get to know you better. Some merely ask you to invite others to the platform or if two people might enjoy meeting each other. The ones to really pay attention to are when they ask you if you would like to meet a person whose profile is shown to you, such as this one:
You give a thumbs up or thumbs down to that profile, and move on. It’s not a guarantee you’ll meet that specific person, but it does help the algorithm narrow down a good match.
Finally, you’ll pick two (at most) 45 minute time slots in a week that you can be around to meet. In a few days Lunchclub will pick someone for you to meet and send you both an invite to a chat. When the time comes you click a link that is sent to you and spend some time with what hopefully becomes a new friend. Afterwards you will be asked to rate a few things about the conversation, giving the algorithm more data to help find better matches moving forward to keep people coming back.
Should I Try It Out?
I think so. I had two conversations this past week and I thought both were very engaging. The matches and I had a few things in common and were quickly able to find things to talk about. On one for example, we talked about returning to the office after COVID 19 and what the timeline for that could be. It really was not hard to keep the conversation going, at least with the matches I found this week.
As I mentioned off the top, I prefer this to Clubhouse because it is much easier to participate in a discussion. I’m someone who likes to contribute rather than sit and listen to people talk about things, and options to do that on Clubhouse are quite limited. Even though there are no large rooms in Lunchclub and it is more one on one, it does make contributing to the conversation easy. If you prefer just listening, then Clubhouse may be the platform for you. Since these are two people talking as opposed to several speakers, there isn’t anywhere to hide if you are shy.
It also does not have to be limited to just connections either. The platform can have legitimate business impacts for people, particularly those who work in sales. It really can be a good way to prospect if you use the platform right. (On a side note, I do not recommend using this as some kind of dating service. That isn’t what the platform was designed for so if your mind is there, pick another place. Keep the platform professional for everyone.)
Where Is This Concept Headed?
Let’s start with the obvious question: once COVID 19 is done, does Lunchclub have staying power? Particularly as people start to crave in-person interactions again?
I believe it does. Remember that, prior to the pandemic, Lunchclub started around the concept of two people physically getting together. They pivoted in the face of the pandemic (a quality of smart management) and found their stride. Once people regain the confidence to gather in person, Lunchclub may be well positioned to take advantage, having experience in the concept in the past.
There is another positive for Lunchclub too: they are well positioned to connect people globally in this manner. In person coffee chats are great, but they aren’t always feasible. If I want to meet someone on the west coast, the only realistic option I have is a virtual chat or phone call. Given that, I think there is still a place for Lunchclub in a post-pandemic world.
Two things are going to define how high the growth arc can be. First, as the platform grows and gets more data about users, can the algorithm keep churning out quality matches at scale? One of the keys to loyalty is reliability - delivering quality matches that lead to quality conversations over and over again. As the platform gains users, that could become harder. I believe their leadership has the chops to deal with this, but it bears watching as the platform grows and, potentially, expands into different verticals.
The second one is key to me: what path exists to monetization for Lunchclub? One that has been discussed is charging a fee to their users. I think this is fine to do, but it must be done in a careful way. Once money is attached, expectations will be raised and users will expect results, however they personally define them. One idea is to allow users to purchase more than the 2 chats per week. Hinge, the online dating app, does something similar: users get a fixed amount of likes per day, but can purchase more if they would like.
Another idea that may have some traction is using Lunchclub to connect employers and employees, or firms with those who may be interested in investing. This one I’m a little less enthusiastic about. For one, this brings them into more direct competition with companies like LinkedIn and Indeed, companies who I could see fiercely protecting their turf if Lunchclub were to try to encroach on their turf. Both of them have the means and motive to make sure Lunchclub doesn’t succeed in this area.
For another, under this model the compensation could come from successful hires or referrals that lead somewhere. To me, this makes sense for smaller firms trying to establish their footing, not for larger ones with more resources. That segment could be profitable, but scaling it will be a challenge, particularly amongst startups who are often short on cash but big on ideas. Though I don’t have any data points in these areas, I would think this to be a difficult task.
Don’t get me wrong - I’m not saying Lunchclub shouldn’t do these things. History in business has plenty of examples where upstarts took on established companies and won when nobody thought they had a chance (if you don’t believe me, look up how Netflix toppled Blockbuster or how Southwest Airlines gained its footing in the airline industry) and monetization concepts that succeeded when other did not think they would. What I am saying is this will be an uphill climb in a changing world - not an easy task to accomplish.
Those items aside, for you the user, Lunchclub is worth a try. It really does make networking easy, and there are a lot of positives to the concept. If you gave Clubhouse a try, give Lunchclub a shot too. Who knows, you might even be matched with Elon Musk!
Oak Moon is a consulting agency based out of Columbus, OH that helps companies market their brands, define value propositions and uncover customer insights, among other services. If you are interested in hearing more or have questions or comments about this blog, feel free to reach out to me at firstname.lastname@example.org.