After just over a year in the market, Artifact, the social network created by Instagram’s founders, is coming to an end. In a blog post released on Friday, the startup declared that it will be “winding down operations” due to the limited market potential and lack of investment opportunities.
The Artifact team had been constantly updating and tweaking its original concept of a news aggregator, turning it into a platform for content curation and news discovery. With the ability for individual users to become creators and share interesting finds from the web, the app also utilized AI tools to summarize news, rewrite headlines, and deliver the best content to its audience. However, in the process of rebranding, the core value of the product seemed to have been diluted. What was once a straightforward news app that could compete with existing options like Apple News, had now morphed into a Twitter-like replacement. Yet, in a market filled with competitive alternatives, including Meta’s own Twitter rival, Threads, Artifact was struggling to stand out.
“Recognizing the reality of the market is something that many startups fail to do,” writes co-founder Kevin Systrom in the blog post. “But making the tough call early on is ultimately beneficial for all parties involved.”
Systrom goes on to explain that the biggest cost for any startup is time. By shutting down Artifact, the team can now focus on developing newer and more impactful projects that have the potential to reach a larger audience. With the advancements in AI technology, the opportunities for innovative ideas are endless. Systrom remains optimistic, stating, “We live in an exciting time where artificial intelligence is changing just about everything we touch.”
- In order to ease the transition for users, certain features of Artifact will begin to be phased out starting with the ability to comment and make new posts. This will also lessen the need for moderation efforts.
- Existing posts will still be visible for the time being and the app’s core news functionality will remain available until the end of February.
While Artifact’s decision to shut down may come as a surprise, it is not uncommon in the rapidly evolving landscape of social media and news aggregators. SmartNews, for example, had a tumultuous year in 2023 with layoffs and a CEO replacement. This can also be attributed to the changing ways in which users obtain news and information, with the growing presence of AI technology. Additionally, publishers are finding their content being used as training data for AI bots, leading to legal action and licensing agreements.
As for Artifact, its lack of a clear identity may have been a contributing factor to its inability to capture and retain a loyal user base. It struggled to find its place among a sea of social media platforms and news aggregators, making it difficult for users to integrate into their daily routines.
Despite the closure, Systrom believes that news and information will continue to be a critical area for startup investment, and he has confidence in the bright minds working on new ideas in this space.
Last fall at the TechCrunch Disrupt conference in San Francisco, Systrom spoke about the role of AI in Artifact. To watch the full talk, see the video below:
