Agora and the Future of Video

Agora ($API) was brought up a couple of times on the board, initially by muji I believe. I’ve written a deep dive on it on my Substack where I provide an overview of its platform, customers, competition, market opportunity, financials, and risks. I’m long Agora in my personal portfolio and it’s a company I’m really excited about as it has most of the criteria I look for in a potential multi-bagger: hypergrowth, huge TAM, small market cap (under $5B), strong margins, and capable management.

A simple way to describe it is it’s like a Chinese Twilio focused on video, and more specifically live streaming. Although many on this board are understandably hesitant about Chinese companies, my confidence is a bit higher in this one given founder and CEO Tony Zhao’s history of working in the US (he was a founding engineer at WebEx), that Agora has dual headquarters in China and the US and only expanded to China a year after it was founded, their impressive customer list with giants like Xiaomi and ByteDance, and some famous investors like Coatue that reportedly decided to invest after just two weeks.

My Agora thesis also ties in with the future I see for Twilio and Zoom, and I go over it in the market opportunity section. Namely, I believe we will be seeing a gradual unbundling of Zoom. Here’s a nice quote by JJ Oslund, who’s article I reference: “Companies like Zoom that achieve massive growth and ubiquity lose one important competitive advantage: the ability to focus on a particular user… Zoom has become the lowest common denominator that works for everyone, yet it is not perfectly suited for anyone.”

ZM has already made significant inroads into education and telehealth but there is significant opportunity to chip away at their moat by focusing on serving specific user needs. The real competition isn’t WebEx, Meet, etc, it’s the 250+ companies carving out their own verticals. “The endpoint for the verticalization of Zoom will be a no-code tool that gives users the power to design highly custom video apps for their particular needs.” And that’s exactly what Agora is building.

The other part of my thesis, which may be of interest to Twilio owners, is that I believe some revolutionary businesses will be ideated in the current environment. Some of the greatest innovations came during periods of the greatest turmoil and with the advent of the API economy, companies like Twilio and Agora are well-positioned to help the new wave of start-ups, such as the ones that are competing against Zoom in specific verticals, scale up fast. In my opinion, the most exciting vertical for Twilio is healthcare. They became HIPAA compliant in February, and they’ve since seen more than a 100 percent increase in active healthcare customers using its video product. I think as traditional healthcare systems digitize then TWLO can do really well here even though this vertical is non-material to their growth right now. This plays into my TDOC thesis that I’ve outlined in previous posts.…


This podcast provides further context to the industry that Agora is operating within, cloud gaming,which is similar to the content delivery by networks like Netflix. GaaS (gaming as a service?) eliminates the need for hardware, and possesses multiple revenue generating channels which include purchasing in-game content, streaming exclusive content within games, a system for tipping the gamers (which is unique to ASEAN and China and generates a lot of revenue). The global market for gaming and esports far surpasses other industries and is untapped (don’t recall numbers but podcast discusses it)

The podcast is by Ark invest, and parses the different stakeholders, including platforms (like twitch), the players who are either content creators (like Ninja) or esports players, and consumers.

It also goes through:

  • how its monetized
  • the need for high quality CDNs (need for very low latency)
  • infers aspects of moat for this industry
    -biggest trend is mobile which is democratizing gaming…

We don’t really have anything analogous to it in the US, and despite living in Thailand and I haven’t really been exposed to the way in which esports are monetized in China and the ASEAN countries



““The endpoint for the verticalization of Zoom will be a no-code tool that gives users the power to design highly custom video apps for their particular needs.” And that’s exactly what Agora is building.”

…Isn’t that what exactly what ZM has ALREADY built?
Your argument is that Agora’s APIs can be used to embed its voice/video network functionality into custom applications, and can thus “un-bundle” ZM functionality…correct?

Doesn’t the existence of ZM’s own published APIs negate your argument?

I’ve looked into API, and I can’t find anything it offers that ZM doesn’t. If I’m wrong, please help me understand.

Thanks, --intjudo

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Richard Chu (Digized) is more active on Twitter. You may be interested in the recent threads on API there:……

I’ll be summarizing my understanding of Richard’s thesis here, so bear with me.

Before Zoomtopia last week, the thesis was that Zoom may have had developer APIs but it was not their focus. They were focused on broad market adoption of their out-of-the-box video products. This broad market focus is leading to huge growth in the short term, but leaves Zoom open to competitors focused on building products for specific verticals. However, the announcements regarding the marketplace, app development, and APIs at Zoomtopia indicate that Zoom may be turning their attention to the broader platform capabilities.

I’m not terribly familiar with Zoom’s SDK (as it sounds like you might be). This announcement specifically calls out new customization capabilities:…

I believe this is where Agora may have had an edge previously. Now, it’s not so certain. API, TWLO, and now ZM are all using the term “Real Time Engagement” in their product marketing. Zoom just happens to have the most momentum in terms of brand recognition and growth.

I’ve read theories that API may become an acquisition target of ZM at some point. I believe the CEOs are familiar, both coming from WebEx. I’m maintaining a very small API holding at this time, given their strong #s last quarter and the current virtual world we live in. I think there is room for both companies, especially with Agora primarily focused on the Chinese market today. Keeping a close eye on Zoom’s product announcements and strategy going forward.