The Curious Case of Socialcam’s Sudden Rise to Fame – Unveiled!

Earlier this month, Socialcam, the video-sharing app often referred to as “the Instagram of video,” was sold to Autodesk for $60 million. Whether or not the sale is a success story depends on who you ask.

Most startup founders would kill for a $60 million exit, but the fact that Socialcam attracts close to 55 million active monthly users on Facebook may justify an even higher valuation — especially considering that Viddy, a rival video-sharing company with fewer Facebook users, was valued at $200 million back in May.

But let’s leave that debate for another time. Because the first question that comes up when you learn about Socialcam is not what they sold for, but how on earth they managed to reach 55 million users in 18 months.

The background: Socialcam, launched as a spinoff from Justin.tv, enables users to shoot videos with their smartphones and share them on social platforms. And, as with Instagram, they can follow other users. Users can also add songs to their videos and edit clips with custom filters like Blueprint or Watercolor.

So, how did a fairly simple video-sharing app with plenty of competitors get so popular so fast? It certainly didn’t hurt that Socialcam’s parent company, Justin.tv, was funded by Y-Combinator, the legendary seed fund that has also funded DropBox, Airbnb, and Reddit, among many others. As with most things in life, having the right connections can make all the difference in the startup world. Just ask Instagram’s founders.

Socialcam’s team was also savvy when it came to building an online community, making it really easy to find and follow popular users. Celebrities using the platform, for example, provide a massive amount of free publicity, such as MC Hammer who has 1,449,589 Socialcam followers to date.

But what’s behind the real story is Facebook — or, more precisely, how Socialcam’s aggressive and sometimes downright sketchy tactics on Facebook have given way to its meteoric rise.

Socialcam, like plenty of other apps, forces users to connect via Facebook when they download the app. So it only makes sense that Socialcam wanted to take advantage of Facebook’s Open Graph. (Besides, they weren’t the only ones that used Open Graph to publicize users’ every click.)

Most users probably realized that when they posted a video using Socialcam, their activity would be highlighted on their Facebook Timelines and appear in their friends’ feeds. What was probably less obvious to most users was that every time they watched a Socialcam video, it also updated their Timelines with the video they had just watched. In other words, someone could stumble upon a video of say, a track star doing a sexy warm-up routine, and the next thing he knew, everyone he’s connected to on Facebook — his girlfriend, boss, etc. — knows what he’s been watching. Embarrassing or not, the point is that in being able to publicize the app every time someone watched a Socialcam video, Socialcam struck Facebook gold.

And the plot thickens. Several months ago, a blogger noticed that even when users went out of their way to change their settings so that their activity wouldn’t show up on Facebook, Socialcam essentially ignored their request. If you left the app and returned later, Socialcam would conveniently not remember that you had toggled your setting to “off” — meaning that everyone would know that you went back and watched that sexy warm-up routine a second time.

Socialcam claims that the toggle problem was a bug that’s now fixed. But whatever the truth may be, it’s clear that the company is aware of its reputation. Now, when you download the app, the first thing you see below the big button to log in with Facebook is: “We won’t spam your wall. Promise.”

It would’ve been easier to give Socialcam the benefit of the doubt on the “bug” that wouldn’t let users turn off the Facebook Timeline mentions if Socialcam hadn’t already been caught engaging in an even sketchier practice. As Mike Isaac wrote on All Things D, Socialcam developed a nasty habit of scraping videos from Vevo and YouTube, which “essentially amounts to ripping content directly from other services.”

Here’s how it worked. Socialcam would upload popular YouTube videos to its own servers and then distribute them with dummy accounts. Every time someone watched one of those viral videos, word spread across Facebook, inflating Socialcam’s numbers.

Someone (perhaps one of the Y-Combinator honchos?) finally convinced Socialcam to clean up its act. But rather than abandoning the practice altogether, they simply began embedding YouTube videos into Socialcam posts. The difference is that now the videos are clearly identified as coming from YouTube.

For those wondering why Socialcam was only worth $60 million, this is most likely the answer. They were riding the videos of other services to the top, and they were also beholden to Facebook’s whims. Like other apps that rely on Open Graph integration, Socialcam’s traffic shoots up and down as Facebook fiddles with the algorithms that determine how often Timeline activity appears in friends’ feeds.

But before Socialcam is dismissed as a con, it’s worth remembering that there are millions of people using and enjoying the app exactly as intended. And Socialcam is hardly the first tech player to use shady tactics to gain users or boost traffic. How many sites have climbed to the top of search engine rankings with SEO tricks? YouTube itself rose to popularity because of the copyrighted content that was being circulated on the site, and the company wasn’t quick to stop the practice. Facebook is notorious for gradually chipping away at user privacy. And Google doesn’t exactly have a clean slate.

All in all, this isn’t a story of a single rogue company, so much as a reminder that even as the Internet has become respectable over the last two decades, there’s still a certain Wild Wild West ethic. Bad press is never fun, but it’s a pretty small price for a $60 million payday.