Bluesky Gets Serious and Raises $15M - But I See a Problem
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It's been a very interesting time for Bluesky, the other twitter, recently. The platform opened up in February, and after lots of ups and downs, is joining the rest of its competitors and rolling out a paid tier. It also just took a $15M investment round last week.
Can Bluesky, which started with Twitter's original co-founder Jack Dorsey, become a major player in the (pretty static) world of social media?
You know how I answer these questions - Here's a look at Bluesky's journey from its lukewarm rollout to adding hundreds of thousands of new mobile users in a single day a few weeks ago.
Bluesky launched as invite-only back in February of 2023, and operated that way for a whole year. While in private mode, Bluesky's mobile app was downloaded 3.6M times between the App Store and Google Play. When Bluesky opened to the public, downloads climbed to 135K, which felt high but not as high as some, including me, expected.
The thing is, that was the best day of downloads for quite a while, exactly 206 days later, when downloads finally beat that initial peak. That day, at the end of August, earned Bluesky 331K downloads, according to our estimates, but was topped the next day with 420K estimated downloads and started a good month for Bluesky which resulted in 3.1M new downloads for the platform.
But the good run ended and downloads dropped down to just 4K daily downloads. Quite a big swing, but certainly better than the 206 days between peaks where downloads averaged just 1.2K per day.
A couple of weeks ago, Bluesky saw its biggest spike yet - 433K downloads in a single day. Downloads dropped the next day, but are still averaging 10x than what they did before the spike.
But Here's the Thing
Other than the long drought Bluesky saw for most of the year, it's latest spikes should be a great sign for investors, right? After all, since opening up to the public, the app was downloaded 6.8M times, according to our estimates. Add that to the pre-release downloads and we're looking at almost 10M downloads.
But...
Those spikes were not the result of great traction but rather a reaction to rival X. The first spike at the end of August was a result of X getting banned in Brazil. It eventually returned, however.
The more recent spike came after X announced a change to how blocking users works. The outrage was immediate, but it eventually ended.
When we look at the trend through that lens, it's clear that Bluesky's growth is a reaction to X and not necessarily its own traction. That's a pretty scary dependency, and that's what I think is Bluesky's problem.
For context, X saw the same number of downloads as Bluesky did since it was released in the last 30 days.
This might be a controversial opinion, but for Bluesky to succeed it needs to be more than just platform place people try out when they're unhappy with something Elon said. Until the, it's really at the mercy of X. And that's a problem.
I'm not hating on Bluesky here but rather hoping to see it flourish into something X isn't and give users a value-based reason to switch that isn't emotional. That's how it'll succeed.
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All figures included in this report are estimated. Unless specified otherwise, estimated revenue is always net, meaning it's the amount the developer earned after Apple and Google took their fee.
