Clubhouse, which led a round of investment in January at a reported valuation of around $1 billion, now believes it is worth four times that, Bloomberg reported on Tuesday.
A new round of funding the audio chat app is negotiating with investors may value the company at around $4 billion, sources told the news agency, although it’s “unclear how much Clubhouse is seeking to raise or which investors are participating.”
Bloomberg noted that Clubhouse quadrupling its own valuation in the span of just a few months would reflect the “astronomical expectations” of investors, which is a bit of an understatement given the company was only launched a year ago and has yet to prove livestreamed audio conversations can rake in that much revenue. As the Information noted back when Clubhouse hit a $1 billion valuation, there isn’t even an Android version of the app yet, and the company also isn’t making any money. Right now it’s still in the dollar-draining phase of its operation, trying to lure buzzy influencers with cash incentives in order to lay the groundwork towards monetization. There’s also the risk that Clubhouse’s live, public audio chat rooms are primarily so popular right now because the ongoing coronavirus pandemic is preventing its users from doing just about anything more interesting than attending virtual seminars.
Per Bloomberg, investment firm Andreessen Horowitz valued Clubhouse at around $100 million or so prior to January:
Andreessen Horowitz has been a major booster of the app. It initially valued the parent company at $100 million before the investment in January at 10 times that valuation. (Bloomberg LP, the parent company of Bloomberg News, has invested in Andreessen Horowitz.)
Nothing is certain yet, and of course, news about impending deals tends to pop up when one of the interested parties wants to push publicity in their favor. So we’ll see.
Clubhouse used to be primarily popular in Silicon Valley, where it attracted certain members of the venture capital set, tech workers, and journalists focused on the industry—not to mention a coterie of bigots and far-right agitators attracted by its loose moderation policies. (It’s also become a hub for rich VCs and various hangers-on to endlessly complain about “cancel culture.”) It’s since proved to have wider appeal, boasting a particularly vibrant Black community responsible for much of Clubhouse’s cultural cachet, and according to the New Yorker, had some 10 million users in February. Brands are now flocking to the app, and an ecosystem of sister apps and audio tools designed specifically to be used with Clubhouse has begun to flourish.
Even if Clubhouse doesn’t prove to be a flash in the pan, it’s going to have to compete with a huge and in some cases baffling array of apps that have eagerly jumped at the chance to clone its features. Facebook, TikTok parent company ByteDance, and Twitter, as well as business-world apps LinkedIn and Slack, are all rushing to launch their own audio chat features.