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Agora - Clubhouse Is Just One Of The Possibilities

Feb. 04, 2021 1:58 PM ETAgora, Inc. (API)EDU, U, YALA43 Comments
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DTF Capital


  • Clubhouse, a live audio social media platform, was created using Agora's toolkit in a week.
  • Its membership has exploded to over 6 million and is currently ranked top by the number of downloads in developing countries.
  • But Clubhouse's explosion is just one of the catalysts to Agora's growth. Yalla, another audio-social app that is on fire in the Middle East. And there are more.
  • Finally, the market is appreciating the immense potential of Agora's technology.

Investment Thesis

Shortly after Agora's (NASDAQ:API) IPO, we have attempted to explain what the company offers and why we were very bullish about its technology, titled:" Agora: Pioneering Real-Time Video Engagement, Forget The High Multiple, It Doesn't Matter."

The stock did practically nothing until recently. It doubled within a few weeks, currently trading at above $90/share. What fuelled the recent rocket move has much to do with the rise of Clubhouse. We believe that Clubhouse could contribute hundreds of millions of revenues per quarter. However, what is more important is that the world can now see Agora as a perfect launchpad for real-time communication applications. The possibility is immense.

As a reminder, Tony Zhao, the founder and CEO, 's mission of building Agora is to enable immersive virtual interaction with anyone anywhere on any apps. Agora's solution offers scalable, cost-effective, and simple solutions to embed video, voice, and messaging functions to applications and devices on the cloud without building the infrastructure themselves. Clubhouse is an incredible testament to what can be created on Agora, not just the scale but the speed. The app was reportedly created on Agora within a week.

Impressive? There's more.

Clubhouse is on fire, but what is it?

First, what is Clubhouse?

It's a new audio-only social app. It allows users to drop in and out of chat rooms, from 'water-cooler' conversations to conference talks. So far, the main difference is that these chat rooms are live-only, ephemeral (no recording, or at the organizers' discretion), and it's invite-only (exclusive).

That doesn't sound too special? Not until Elon Musk entered one of the rooms, where he chatted about life on Mars and bantered with Vladimir Tenev, the CEO of Robinhood, about the recent uprise of the wallstreetbets last weekend. People from around the world dropped whatever they

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I run Sleep Well Investments to find time-tested and anti-fragile businesses to help you avoid permanent capital losses - the first rule of investing. All businesses go through a comprehensive review, I call it a ‘sleep well investment’ checklist, to evaluate their (i) business quality, (ii) competitive position and risks, and (iii) valuation. They are given a score and a trigger (buy) price to ensure a high margin of safety.The first few write-ups are: The VAT Group - The Vaccum Valve Monopoly Shimano - The Bike Component Monopoly Floor and Decor - Future Home Improvement Monopoly Subscribe for more sleep-well investments.

Analyst’s Disclosure: I am/we are long API. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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