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Can a former Myspace CTO drive the creator economy's next evolution?
With Koji, Dmitry Shapiro wants to build content monetization tools for the open web.
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The App Store Tax is coming for the creator economy.
That’s the 30% fee applied to all in-app purchases on iOS and Android devices. For years, this fee has been a scourge for the companies that built their businesses on the back of mobile operating systems, but its effects are now being felt by thousands of YouTubers, podcasters, and other content creators. That’s because virtually every major content distribution platform — from Spotify to Twitter to Instagram — is launching new creator monetization tools, almost all of which will be subjected to the tax.
What once seemed to be the cost of doing business for major corporations like Uber and Postmates is now being applied to social media influencers who are just trying to eke out a middle class living. Suddenly, Kevin Kelly’s “1,000 true fans” theory — which states that a creator can have a successful career with just 1,000 fans paying $100 per year — seems a lot less feasible when 300 of those fans are directly contributing to Apple’s bottom line.
But Dmitry Shapiro doesn’t think creators should spend much time worrying about app store fees. That’s because Koji, the company he founded and runs, is built entirely on the open web. “We don’t believe that we will ever need to create a native app,” he told me earlier this year. Koji gives creators dozens of ways to collect money from their audiences through subscriptions and one-off purchases, and its mobile-friendly design is perfect for the in-app web browsers used by Facebook, Instagram, TikTok, and Twitter. What’s more, its 5% cut of all purchases is much more palatable compared to the fees charged by its competitors.
Koji has only been out of private beta for less than a year, and creators are now launching about 500 new accounts a day on the platform. According to Shapiro, some Koji users already generate thousands of dollars a week, and he thinks it’ll one day surpass other monetization platforms like Cameo, Patreon, and Substack.
But creators are only the first constituency Shaprio wants to serve. The main draw of Koji — and what sets it apart from its competitors — is that anyone can build applications on its platform, and he hopes to entice developers into launching thousands of Koji apps on the open web, outside the restrictions of iOS or Android. To accomplish this, he needs to convince the tech entrepreneurship community that there’s a real market for open web apps.
It’s a tall feat, but if anyone is equipped to do it, it’s Shapiro. For the better part of two decades, he’s worked on some of the biggest platforms for distributing user generated content. In addition to holding executive roles at places like Myspace and Google, he also founded an early competitor to YouTube. Few people have spent as much time as he has thinking about how to serve online content creators.
Is Koji really the creator economy’s next evolution? To answer this question, I interviewed Shaprio and his colleagues. I also spoke to some of the creators who use the platform. Let’s jump into my findings:
A little too late to the party
Depending on how you look at Shapiro’s past, he’s either had an incredibly successful tech career, or he’s always been a little too late to the party. On the one hand, he’s raised tens of millions of dollars from VCs and held senior executive roles at some of the world’s most famous companies. On the other hand, many of the products he worked on have either shut down or are now shells of their former selves.
Take his video startup Veoh as an example. He came up with the idea for it in November 2004, when he was on his honeymoon. “My wife never forgave me for spending our entire honeymoon in my own little world, obsessed with this idea,” he said. “And that idea was that I was going to make it possible for anyone to publish video to the internet.” This was several months before the launch of YouTube.
Shapiro had raised $34 million for a previous startup and was well connected within the VC world, so when he arrived back in San Diego, he pretty quickly set about pitching his idea to firms that ranged from Bedrock Capital to Benchmark. “I sat in front of them and gave my spiel, and they looked at me and said, ‘I don't get it. It seems like a solution looking for a problem. Who wants to create video and share it on the internet? And who would even watch it?’”
Meanwhile, YouTube launched in February 2005 and was an almost instantaneous success. By the time Shapiro debuted Veoh in September, YouTube was the most prominent video player on the internet. Though Shapiro always knew that amateur video creators might use his product, he didn’t envision that as its primary use. “I really wasn’t pitching these super short, bite sized videos,” he said. “I was pitching longer form, higher quality videos. My idea was that we could use peer to peer tech to dissipate the cost of hosting these videos.”
Because video hosting was extremely costly at the time, Veoh’s engineers spent much of their time on developing more efficient distribution technology to reduce those costs. “YouTube did it the right way,” said Shapiro. “They said, ‘we don’t need to solve that problem now. Let’s run toward the cliff and we’ll figure out what to do once we get to the edge.’” Sure enough, YouTube sold to Google in October 2006, mere months before it ran out of cash.
By that point, YouTube was orders of magnitude more popular than Veoh. What’s worse, Universal Music Group sued Veoh in 2007 for hosting its copyrighted videos. And because Universal also sued the company’s investors, it became impossible for Shapiro to raise any more money. “They were like, ‘look, these companies are mad at you guys, and if we show up and give you more money, they’re just going to sue us. We don’t need more hassle.’”
In 2008, Veoh won its lawsuit, but it was a pyrrhic victory. By 2010, after it won two appeals, it entered Chapter 7 bankruptcy and was sold off to an Israeli social media company. “We ended up as precedent for Viacom vs YouTube,” Shapiro noted, wryly. “We’re mentioned in that lawsuit.”
That same year, Shapiro came on as CTO of Myspace, which at that point was owned by News Corp and struggling to maintain relevance in the wake of Facebook success. His tenure at the company was short — only 11 months — and I assumed he’d agree with me that the platform, at that point, was a lost cause, but he pushed back on my narrative. “Myspace was a digital nightclub,” he said. “It was a place you could go and stumble around in the middle of the night with a glass of wine in your hand, looking at pictures of random people, adding them as friends. That’s never been replaced.”
Shapiro’s idea was to overhaul the Myspace profile to make it dramatically more customizable, an idea that would resurface when he later built Koji. He encouraged me to go to the Twitter search bar and type in “I miss Myspace.” Sure enough, thousands of people every month — more than a decade after Myspace reached its peak — are still expressing this sentiment. “When you go out to a bar, you don’t put on a white and blue uniform, a Facebook uniform,” he argued. “You’d put on all sorts of amazing things to stand out. You’d want to be radically different from all others. And that was the real value of Myspace. When people talk about missing Myspace, they miss customizing their profile. They miss spending hours and hours obsessing over who they should pick as their top friends and what music they should play on their profile. That self expression — there’s a little bit of it on the Facebook profile or the LinkedIn profile, but nothing to the extent of what Myspace provided.”
Could Shapiro’s ideas have resurrected Myspace’s reputation? We’ll never know, because in 2011 News Corp sold the platform to an advertising network. This didn’t exactly excite Shapiro. “Justin Timberlake was going to come in and be my partner in building the product, and I was going to be CCO. Don’t get me wrong; I love Justin, but no.” He was gone by the time the deal closed.
After that, Shapiro spent about a year playing around with other startup ideas while Google aggressively tried to recruit him to work on Google+. In 2012, he succumbed to the company’s advances and joined as a product manager in charge of the social graph and user discovery. He spent four years at the company, and even though many of the features his team built live on today in other Google products, we all know what happened to Google+ in the end.
In our conversation, I pointed out to Shapiro that he always seemed to be at the cutting edge of major industries, and yet the products he worked on were doomed to failure. To me, this seemed to show the fickleness of massive success and how so much of it boiled down to timing. “Certainly from a metric of getting super rich, which is what a lot of people optimize for, I have not done that,” he admitted. “I have not had the monster exit that [YouTube founders Chad Hurley and Steve Chen] had.” He said he wasn’t in it for the money and lives a relatively modest lifestyle. “I just like doing work that can be valuable to large groups of people, especially when it comes to building these creative tools, these enablement tools — taking something that used to be the domain of very few people and giving it to the masses.”
That’s not to say Shapiro has given up on the idea of the massive exit. In 2016, he left Google to launch a stealth startup that first focused on augmented reality applications. Though those AR products are still used by teachers and educators today, the company has spent the last two years focused almost solely on building Koji. Perhaps for the first time since launching Veoh, Shapiro sees the potential of growing an entirely new industry from scratch. Where YouTube brought filmmaking to the masses, Shapiro wants to do the same for mobile web apps.
Ask Shapiro about the genesis of Koji, and he’ll tell a story that starts in 1984. “I was watching War Games in a movie theater with my dad,” he recalled. “When I came home, I was like oh my god, I have to go get a computer.”
Shapiro’s family, who had immigrated from Russia to Atlanta in 1979, was poor, so buying one wasn’t really an option. But his school had two Apple II computers, and so he and a classmate spent virtually all of their free time in the lab. “All my friends wanted to party in high school. I sat in front of monochrome computer monitors writing code,” he said. “I felt the excitement of being able to create something from scratch. That was extraordinarily powerful.”
Several years later, Shapiro stood in line at midnight waiting for the release of Windows 95, and though he found the pageantry of the whole ordeal fun, it also struck him as silly. “I thought, this is stupid, we should be able to just download it.” Sure enough, the next decade ushered in the era of Web 2.0, when everyday internet users with no coding knowledge could suddenly publish all kinds of content to the web. Platforms like Wordpress even allowed those users to swap in various plugins that offered virtually any kind of web functionality.
But then Steve Jobs put everything back in the box. Mobile browsers in early versions of the iPhone and Android were clunky and slow, necessitating an app store ecosystem not unlike the box store Shapiro stood outside of in the 1990s. “But that was a long time ago,” he argued. “The mobile web and the desktop web have come a long way, and so you don’t need native apps to do everything anymore.”
Modern mobile browsers, Shapiro believes, are just as versatile as anything you’ll find in the iOS store. Over the course of 2020, his team built out an app store of individual units they called Kojis. Each Koji has a very specific functionality — whether it’s a game or a way to lock content behind a paywall — and aims to be as customizable as possible without requiring any coding skills. A creator can hypothetically browse through the app store, pick out some Kojis, customize them, and have them up and running in less than an hour.
If you scroll through the app store today, you’ll find Kojis that let you accept tips, offer personalized video requests, sell exclusive articles, or lock photos/videos behind a paywall. I pointed out to Shapiro that these were similar to features offered up by platforms like Cameo, OnlyFans, Substack, and Patreon. Why would a creator choose Koji over these others? “These are entire companies that are built around some limited set of features,” he replied.
A user of Patreon, in other words, is limited to whatever tools Patreon makes available. If you want to offer some kind of functionality that isn’t within the company’s product development plan, then tough luck. In Shapiro’s view, Patreon shouldn’t be its own platform, but rather should exist as a Koji. In fact, he predicts that, within a few years, each of the creator monetization companies will launch on Koji’s ecosystem, just as they currently maintain apps in the iOS and Android stores.
Today, most of the Kojis on offer were developed in-house, but Shapiro thinks it’s only a matter of time before the developer community catches on to the potential to make money. “There’s a monetization system built in,” he said. “We track everything. If you’re a developer and you’ve created something, and someone uses your app and makes money from it, you automatically get money deposited in your digital wallet.” Developers are also able — and encouraged — to fork other Koji apps with their own customizations. “Let’s say you’re a developer, and you make some kind of modification to my Koji. When you publish it and the Koji starts generating revenue, I make money as well. We call it lineage.”
Koji spent its first year in private beta and only launched to the public in early 2021. The market for creator monetization is already fairly saturated, and so Shapiro needed to figure out how to get influencers to test out his platform over the dozens of others that were already well known. To accomplish this, he’s relied heavily on Grant Long, Koji’s head of growth.
Like Shapiro, Long has spent most of his career working on creator economy startups, most recently on a Giphy competitor in China. After leaving that role in late 2019, he spent most of 2020 consulting with various startups and first stumbled onto Koji through a Slack channel that year. “I immediately recognized it as something that I've been contemplating for a long time, this idea of these interactive, super lightweight experiences that pass effortlessly through social media, just like the GIFs and stickers that I had built for other startups,” he recalled. “And so we connected on LinkedIn and then I started having calls with him every week for like an hour or two, just talking high level about Koji.”
Long started consulting with Koji in the Fall of 2020 and then came on full-time in December. He argued to me that Koji generates a “flywheel” effect, meaning that once a few influential creators use it, that then leads to other creators trying it out, and so on. To get the flywheel spinning, he started by approaching companies that manage relationships with popular creators. “You know, record labels, talent agencies, management companies,” he said. “We're working with a number of big talent agencies, who represent hundreds, if not thousands, of celebrity clients.”
That’s how Dennis Benning first heard of Koji. Benning generated over 45,000 followers on TikTok through his flute renditions of popular songs (his version of Olivia Rodrigo’s “Driver’s License,” for instance, has over 120,000 views). He told me that a talent agency introduced him to Koji, and he was immediately attracted to the functionality that allows customers to make video requests. Every time one of his flute covers blows up, he’s inundated with requests for more covers, and this tool seemed like a great way to monetize those requests.
I pointed out to Benning that the Koji he chose was very similar to Cameo. “I tried Cameo but I'm not famous enough for Cameo,” he said. He charges $9.99, and customers can request any song they want. They get a private version where he plays the entire song, but he also cuts a 1-minute TikTok version in which he thanks the customer. “Not only does it give me a video concept for my TikTok, but it also gives my TikTok followers a chance to see that they can request a song from me for only $10.” In other words, every video he creates for a customer allows him to promote his Koji to his entire following. When I spoke to him in February, he had only sold about a dozen videos, meaning he’d generated, at most, a few hundred dollars from the platform.
Veronica Jacques also didn’t consider herself famous enough for Cameo. A California-based fashion model with 14,000 followers on Instagram, Jacques was drawn to a Koji that allows her to lock photos behind a paywall. “It's kind of like a magazine where I can post some of my latest photos I've taken and then people can pay to access exclusive images, like makeup or hair trends for 2021.” She’s also tried out several Kojis that don’t generate revenue; her current profile, for instance, features a simple video game in which you can use her likeness to fire a weapon at floating zombies. “Right now, I'm in experimental mode,” she said. “I'm kind of seeing what comes of it. I'm not putting a ton of energy into it, like, oh my God, I need to make money.”
Both Benning and Jacques have relatively small followings and haven’t generated much revenue from Koji yet, but larger creators have joined the platform. An Indian YouTuber with 4.3 million followers, for instance, uploaded a video announcing he created a game on Koji. “Over a million people showed up,” said Shapiro. “Every single day there are thousands of people who play his game. It’s more than a year old now, and a game that was created in two minutes has been played by a million people millions of times.”
Competing for the “link-in-bio”
I first spoke to Shapiro in February, not long after Koji had launched to the public, and over the next few months he would periodically send me an email with updates, usually when some large creator or celebrity had started using the platform. In June, about the time when I started gathering all the materials to write this piece, I reached out again so he could bring me up to speed on the company’s progress.
Right away, Shapiro revealed a problem that had plagued Koji from the very beginning. “We were struggling with retention,” he told me. “We had 70,000 creators playing around with it, but generally we were struggling with getting people to use it on an ongoing basis. They’d make a post and then forget about it, and we didn't want to send them notifications to try to get them to come back.”
It’s not often that a startup founder volunteers this kind of information to a journalist, but Shapiro was confident that he and his team had found a solution.
When he launched Koji, Shapiro assumed that most creators would simply link directly to the Koji website. But when his team reviewed the traffic analytics, they noticed a persistent middleman that stood between Koji and the creators: so-called “link-in-bio” pages. Because platforms like Instagram and TikTok don’t allow hyperlinks in posts, an entire cottage industry has sprouted up aimed at the sole link that is permitted in a user’s profile. These lightweight landing pages allow a creator to quickly and efficiently link their followers to various other social media accounts and miscellaneous websites. Let’s say you’re an Instagram influencer; you may also want to send people to your YouTube channel, your merch page, and your Patreon account. Rather than building an entire website to handle this simple task, you just sign up for a link-in-bio account and then you’re up and running within minutes.
Once Shapiro realized that link-in-bios were the connective tissue that held the entire creator economy together, he knew what he had to do: eliminate the middleman. “It took us one week to build our link-in-bio, which we propose is the most powerful, most sophisticated, easy to use link-in-bio on the market.”
What makes the Koji link-in-bio stand out? Well, for one, it’s free, a selling point that can’t be overstated. What’s more, it allows users to embed Koji apps directly within the link-in-bio itself, giving it a level of functionality and monetization potential that simply isn’t available on most other similar platforms. “We allow people to embed longform, 4k streaming video as their background,” said Shapiro. “It’s all extremely self-expressive.” I was suddenly reminded of his assertion, several months before, that people missed Myspace because of the profile customization.
Koji launched its link-in-bio about two months ago, and Shapiro described it as a “game changer.” “Last month, we had over 14,000 new accounts,” he said. “Right now, we're adding just over 500 new accounts a day. Two weeks ago we weren’t even hitting a hundred new accounts a day, so this is accelerating.” And unlike before, users are sticking around at a much higher rate. “Retention is through the roof. Most of the people that join are switching from other [link-in-bio] platforms.” Because Koji acts as a free landing page, it has much greater utility than any individual Koji app.
When I initially agreed to speak with Shapiro, I was mostly interested in his past. How often do you get to chat with someone who helped pioneer web video, ride the sinking ship that was Myspace, and work on one of Google’s most high profile projects? As for Koji, I approached it with a healthy degree of skepticism. I get pitched on a lot of creator economy startups, and most are flashes in the pan. In order for Koji to work the way Shapiro envisions it will, the platform needs to achieve mainstream adoption.
But ever since I conducted those initial interviews, I’ve begun to spot Koji in the wild. Randi Zuckerberg uses it to charge her fans $250 for personalized videos. The singer Loren Gray points her 81 million social media followers to a Koji that allows her to collect their email addresses. Another musician, Baby Ariel, leverages its link-in-bio features for all of her 46 million followers. Influencers like these run serious businesses and are very selective in where they send their audiences. In only a few months, Koji has managed to catch up to much more mature competitors.
Of course, Koji still has to attract the developer community into creating apps for its ecosystem, but with already-existing buy-in from influencers, the revenue potential is obvious, and Shapiro thinks the community is ready to break away from iOS and Android’s iron grip. “You can completely bypass the app stores now and no longer be at the mercy of their rules and 30% fees,” he said. Koji’s success, in other words, could entirely upend the dynamics for running a mobile-first business. Or, as he puts it: “We are the catalysts for a return to the open web.”
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