Anonymous messaging app NGL announced Friday that it has been acquired by Mode Mobile, a smartphone points company that makes money by bombarding users with ads.
NGL quickly climbed the App Store charts after its release in late 2021, joining a group of similar apps popular with teens that allow users to send and receive anonymous questions and messages. However, most of its existence has been mired in controversy.
Anonymous messaging apps are problematic because they can encourage bullying among teenagers. Snapchat banned third-party apps like NGL, LMK, Sendit, and YOLO from its platform in 2022 after a parent sued the company for playing a role in her teenage son’s suicide.
NGL also came under fire for questionable growth hacking tactics, such as sending users fake messages that appeared to be from a real person but were actually automated by the app. Some users were tricked into paying a $9.99 monthly subscription to get tips about the sender of the fake messages.
After a two-year investigation, the FTC announced that it will ban NGL apps from being made available to minors in 2024. This is one of the most drastic interventions to protect minors from harmful social media experiences.
“NGL’s bait-and-switch tactics led many consumers to complain, but NGL executives laughed off such users, dismissing them as ‘scams,'” the FTC said in a statement at the time. NGL complied with the request by paying a $5 million fine to the FTC.
According to Business Insider, NGL’s two founders, Raj Vir and João Figueiredo, are considering exiting the app. The remaining three app employees will work for Mode Mobile.
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Considering NGL’s questionable growth hacking track record, this partnership with Mode Mobile seems a good fit.
Mode Mobile makes smartphones with “embedded earning features” that the company calls “EarnPhone.” The company claims that users can earn money by performing everyday tasks on their phones, such as listening to music, playing games, and browsing the web. Modemobile generates revenue from “digital advertising partners” who “pay for user attention and engagement,” according to the company’s investor materials. Your phone is basically flooded with ads all the time, but you might earn enough money to buy a beer at a dive bar.
Terms of the sale were not disclosed.
