Are text messages the new social media? Start-up co-founded by Ashton Kutcher thinks so

NEW YORK – Andrew here. You probably received today’s DealBook newsletter, as you always do, by e-mail. But you probably got a bunch of spam and junk mail in your inbox, too.

That is why so many of us are moving our most important communications to text messages. And in the process, the “text inbox” has become the new holy space for brands, far more intimate than your social media feed.

At least, that is the bet that actor turned venture capitalist Ashton Kutcher and Mr Guy Oseary, Bono’s and Madonna’s manager turned investor, made when they co-founded a text message company called Community in 2019.

In the beginning, it was marketed to celebrities to communicate with their fans about tour dates and new projects.

But over the past year, the business has quietly grown to power text messages from some of the largest brands, including McDonald’s, HBO, the New York Yankees and Conde Nast.

When April’s Hollywood blockbuster, The Super Mario Bros Movie, launched an advertising campaign, it came with a phone number for viewers to text, powered by Community.

The company plans to announce this week that it has raised another US$25 million (S$33.4 million), bringing its total fund-raising to US$110 million, from investors such as Salesforce Ventures, Morgan Stanley Next Level Fund and Verizon Ventures. (It did not disclose its latest valuation.)

It also made Mr Robert Wolf, a former chair of UBS Group Americas who served as an informal adviser to former president Barack Obama, its new chair.

He started helping to sign up large corporate customers over the past year, bringing the total clients to more than 8,000.

The company is run by Ms Diankha Linear, a long-time executive who served as an Army logistics and transportation officer.

Community has gained its latest funding as questions have increasingly arisen about social media’s reach and how companies can own the digital relationship with their customers without a middleman such as Facebook or Twitter.

“I started out with Twitter and built a fairly large following on Twitter,” said Mr Kutcher, who has 16.8 million followers.

“But Twitter today is very different than what Twitter was when I originally started playing around with it,” he added.

“The click-through rates are massively degraded – the number of people that actually see the post is massively degraded.”

At Community, in contrast, “we have like 45 per cent click-through rates and 98 per cent open rates,” Mr Kutcher said.

“You don’t get that in social environments because most people don’t even see the things you’re posting.”

Community competes with a bevy of different types of services vying for space in your text inbox, from Attentive to Twilio to Zendesk.

And many of the software platforms that companies use to manage their relationships with customers now have features that facilitate texting.

But what sets Community apart is the dialogue that celebrities and brands have with their customers, who provide troves of information about themselves, which the brand owns and is not shared with Community’s other clients.

Mr Oseary said he was originally drawn to Community because of his role as a music manager.

“I have no way to know who came to the concert tonight. I have no way to speak to them again once they leave the concert. I have no way to know who bought the album,” he added.

“With Community, once they text the number, we now have a way to stay in touch directly. And that information is not owned by anyone but the artist, the talent or the person who’s building a business.”

Companies advertise a phone number that users text to sign up for updates.

McDonald’s posted its number on a billboard in Times Square in April.

The service also allows brands to segment customers who sign up for texts, so if an artist has a concert coming up in Atlanta, only people in Atlanta get the texts.

Using text messages to connect with customers, for all its promise, poses unique challenges.

Brands are required to get their customers to opt in to messages, which is hard to do unless the brand is well established. And customers may want to hear from fewer brands in their text inbox than they do in their e-mail inbox.

“As opposed to e-mail, when you have to scroll to the bottom of the thing and hit the link that says unsubscribe, if you don’t like the text messages you’re getting, you only have to write one word: Stop,” Mr Kutcher said. (That is some news you can use.) NYTIMES