The anonymous messaging app NGL said on Friday that it has been acquired by ‘EarnPhone’ startup Mode Mobile, a smartphone rewards company that profits by overwhelming its users with ads.
NGL shot up the App Store charts soon after it debuted in late 2021, becoming the second to join a class of party-game-style apps popular among teenagers that let users send and receive anonymous questions and messages. But it has been controversial for most of its life.
Anonymous messaging apps can be an issue because they can foment bullying among teens — Snapchat removed third-party apps like NGL, LMK, Sendit , and YOLO from its platform in 2022, after a parent filed suit against the company for its alleged role in her teen son’s suicide.
NGL also took flak for its shady growth-hacking tactics, such as sending fake messages to users that appeared to come from real people but were in fact deployed across the app’s network. Some users were duped into paying a $9.99 monthly subscription to receive clues about the source of fake messages.
It was part of one of the agency’s most aggressive interventions yet to protect minors from harmful social media experiences, after a two-year investigation culminated in an FTC announcement last week that it would prohibit NGL from offering its app to minors.
“NGL used a bait-and-switch to induce many consumers to complain that NGL’s executives laughed about, referring to those users as ‘suckers’,” the FTC said in its announcement at the time. NGL paid a $5 million fine to the FTC and agreed to play by its rules.
Two of NGL’s founding pair, Raj Vir and João Figueiredo, are stepping away from the app, Business Insider reported. The app’s other three staff members will join Mode Mobile.
Given NGL’s sketchy history of growing hacking, this partnership with Mode Mobile seems like an ideal fit.
Mode Mobile creates a smartphone it calls the “EarnPhone,” which comes with “built-in earning features.” Users can earn money by completing simple tasks on their phones, such as listening to music, playing games, or surfing the web, the company says.
Mode Mobile makes money from “digital advertising partners” who “pay for user attention and engagement,” according to the company’s investor materials. Put simply, your phone gets spammed nonstop with ads, but you can perhaps earn enough to buy a round of beers at a dive bar.
