Wed, 29 May 2019
252: The Refinery29 Story—From Bar Napkin Sketch to Media Empire, with Philippe von Borries and Justin Stefano
How four founders turned a sketch on a cocktail napkin into an iconic digital media brand.
One night in 2004, in a bar in New York City, three ambitious entrepreneurs huddled around a cocktail napkin and sketched out a vision.
They essentially wanted to translate the concept of the mall for the internet, only instead of catering to big name brands and retailers, it would connect visitors to all of the amazing independent brands and makers that were flourishing at the time.
That initial sketch—it started as a picture of a virtual mall—has evolved a lot since that night, and the team solidified around four dedicated co-founders. But 15 years later, the dream of Justin Stefano, Philippe von Borries, Christene Barberich, and Piera Gelardi has become a reality, and so much more, in the form of now-iconic digital media company Refinery29.
“One of my biggest regrets to date is that we didn’t save the napkin,” Stefano says.
Since they set out on that journey, the team has created an online space where media targeted toward women is distilled, removing the impurities of stereotypes, taboos, and shame. Initially focused on fashion and style, Refinery29 has since expanded to a staggering breadth of content.
Covering almost every topic imaginable—from skin care to the latest in immigration legislation—Refinery29 is a comprehensive digital media company dedicated to elevating women’s voices. It’s built an international audience of more than 550 million across all its platforms, which include all major social media, a YouTube channel with nearly 2 million subscribers, an award-winning podcast in its fourth season, a short film series, an app, and more.
But Stefano and von Borries, the two who initially had the idea for Refinery29, didn’t come from a background in publishing or fashion. In fact, as you may have noticed, they aren’t even women. But they saw a need, set out to meet it, and connected with the right partners to realize their vision and help it evolve.
In the early 2000s, Stefano and von Borries were just a couple of friends from high school, who had recently graduated from NYU and Columbia, respectively, and were embarking on their first post-grad endeavors.
Von Borries headed off to Washington, D.C., to work for a political startup called The Globalist, and Stefano took a position with the Civilian Complaint Review Board in New York City, where he investigated complaints against the NYPD.
Despite the distance, the duo stayed close, and maintained a group of friends who were mostly in the creative space. They began to notice a frequently recurring topic of conversation among the group: dissatisfaction with media coverage, especially when it came to fashion.
“Most of the media companies that existed, most of the magazine businesses, were fairly mainstream,” Stefano says. “They would write about big designers that bought pages in their magazines. That’s how the model worked.”
Stefano and von Borries found that many of their friends still read these magazines, but not because they felt particularly connected to the content.
“They didn’t think it was good. They didn’t think it was interesting,” Stefano says. “It was just what they were forced to read, because that’s what you could buy at a newsstand.”
Their friends hungered for something with a more independent edge and authenticity, but couldn’t find it anywhere.
So the pair had the spark of an idea: What if they created something that appealed to young New Yorkers by focusing on serving their audience rather than on serving big companies and brands. But with no experience in publishing or fashion, they knew they needed to call in reinforcements.
At the time, Piera Gelardi was dating von Borries (they went on to get married), who worked as the photo director at CITY Magazine. When von Borries shared their idea and asked for her advice, she encouraged him to reach out to her former boss and mentor at CITY, Christene Barberich. Her knowledge of fashion and brands, as well as the world of publishing, would prove invaluable to the pair.
Barberich says that she was already paying close attention to the transformation happening in the media landscape. She noticed that with the rise of the internet, the one-way nature of traditional publications, with outlets talking at their audiences instead of with them, was slowly being set aside in favor of platforms offering more conversational approaches.
So when von Borries and Stefano shared their idea, she had a gut feeling that they were on to something big.
She immediately reached out to Gelardi and told her that she didn’t just want to consult. She wanted to become a partner in the endeavor. Barberich’s infectious excitement for the project then made Gelardi reevaluate her own position as a consultant.
“Because she wanted to sign up, it showed me that bigger vision and also reminded me to think about my own value in the equation,” Gelardi says. “Now we have four co-founders.”
Building the Brand
With the team assembled, the quartet was anxious to get their vision off the ground as quickly as possible.
But all four of them still had day jobs, so much to learn, and very little money to put toward the project. They met in a coffee shop every night after work and on every weekend as they powered toward their goal.
“It just became an obsession until we got it live,” Stefano says.
They called in all kinds of favors with friends who were programmers, engineers, and graphic designers, and built the first iteration of Refinery29 over a period of six months.
“It felt like forever,” Stefano says. “That six-month period, I think it felt years of work went into that.”
But in June 2005, the wait was finally over, and the team celebrated the launch of Refinery29 at a bar called Union Pool over pizza and beers. Looking back at nearly a decade and a half and several waves of changes since, the founders are still proud of the original website they launched that day.
“When you look back at the first iteration of Refinery29, it just really, deeply warms my heart, because I think it’s still beautiful,” Barberich says.
While the website received some fanfare on launch day, growth was a slow, gradual process, and they struggled to be taken seriously, especially by traditional media outlets.
“Most of the traditional publishers saw digital as a phase,” Gelardi says. “It’s so laughable now, but truly we would go talk to people, and they would act like we were trying to sell them a carpet or something. They thought it was a scam.”
Challenges aside, the untested nature of their business model was also a blessing in disguise.
“I think we were able to really pioneer this new space because it was, you know, an open road,” Gelardi says.
Barberich agrees. “When you start out and you really are at the beginning of something, you have so much freedom to just test things,” she says. “I do credit that period—the first two years when we were essentially flying under the radar—as this really important testing ground for us.”
They gradually tried out new content, such as a segment called “Neighborhood Watch,” in which local creatives shared fun activities and events they loved, and “Spotlight,” a section featuring products by homegrown, independent makers.
“The products that we would feature would sell out overnight,” von Borries says. “That was the first time that something we had created had really been validated. So we started to look into commerce.”
In early 2006, they decided to raise capital for the first time to fund a marketplace on their website, and in 2006, it launched, taking Refinery29 into its next phase.
“We didn’t engineer this thing at all to be what it is today,” von Borries says. “In fact, I think the journey for us has been sort of going down the river and hitting different moments of momentum in the business and seeing the world shift.”
And as the world shifted, so did they.
Experiments and Expansions
Before long, von Borries had quit his D.C. job and returned to New York City to work full time for Refinery29, and not long afterward the other three joined the work full time, too.
Stefano says that, over the first five years, they sold ads, hosted live events, held sample sales (retail events that involve selling extra prototypes, often from big names in fashion or design) and did everything they could to drive slow-but-consistent growth that took them to $1.7 million by their fifth year.
They then decided to raise capital to grow their branded content and native advertising. This resulted in a single-year leap to $8.9 million in revenue.
“It was not a fast journey,” Stefano says. “I think that a lot of people have this belief that you’ll launch a business and within, you know, 18 months, you’re going to be on fire, but it often takes far longer. And I would say it took us probably 10 years before we felt like we had a business that was here to stay.”
As von Borries and Stefano toiled away on the technical and management side, Barberich and Gelardi dove into the content and creative aspects of the business.
“Our desire has always been to elevate underrepresented voices, to really bring these new ideas to the surface and challenge sort of what is in the mainstream, and how the media speaks to and about women,” Gelardi says.
While the focus was initially centered on fashion and style, the pair slowly experimented with content expansions that appealed to the women who visited the site. Barberich was interested in topics surrounding health and wellness, so she tested the waters and found the audience receptive. Gelardi noticed that most mainstream editorial content on sex for women was “not focused on women’s pleasure or bodily autonomy,” so she looked to offer something better.
As they grew, they found an almost endless hunger for content on just about every topic imaginable, and with each new addition, a new wave of readers joined the ranks. Soon, stories on politics, finances, and entertainment appeared on the website, continuing to meet the interests of modern women.
They were also able to quickly learn from mistakes and make changes, thanks to the instant feedback provided by comments, shares, and analytics.
“We really were focused on experimentation,” Gelardi says. “We were so invigorated by having access to the knowledge of our audience in real time.”
With the kinds of data that traditional media outlets simply didn’t have at their fingertips yet, they were able to make informed decisions and pursue avenues that seemed utterly foolproof. But, Barberich says, information in this space can be both a blessing and a curse.
“I think in some ways you lose that spontaneity,” she says. “Just having an idea to do something and being able to pursue it and not worry so much about what the outcome was going to be or worry that it was going to hit a certain traffic benchmark.”
So while they take advantage of the analytics available to them, Gelardi says she always wants to leave room for risks.
“I think influence also comes down to risk-taking,” she says. “It’s the art and the science; it’s not just about volume. Quality can be subjective, as well, but I think it is about risk-taking and knowing that core of who you are and staying true to it.”
Barberich and Gelardi say that they see their roles as a balancing act between the numbers and creative spontaneity.
“I think that that’s really what motivates people,” Barberich says. “When they feel like they’re making content that they deeply love, but that’s also touching a person’s life. The greatest success is to know that something struck a chord that is universally felt.”
Scaling With Heart
As the company continued to grow, all four founders felt an overwhelming pressure to keep the train on the tracks.
“I think that a lot of people lose sleep in this company because they care so much,” Barberich says. “In laying that foundation, we want to make sure that people feel really fulfilled by it and it doesn’t lose its path.”
They knew they had to stay true to the heart of their mission and remain in sync with their audience, all while rapidly expanding far beyond what they had imagined possible.
“The audience has been the single most important focus—and staying committed to that audience—and clearly everything that’s happened in the world at large has sort of snowballed our commitment to serving women amazing content,” von Borries says. “Our belief is that, in this moment, to really build a long term, sustainable brand in this space, you really have to mean something to your audience.”
And Barberich believes the key to scaling while staying true to the heart of the business lies in a single, but incredibly vital, part of the business.
“Honestly, if I’ve learned anything in the near-14 years that we’ve been doing this it’s that it all comes down to the people that you hire,” she says, “because scale is all about the people that you’re trusting to handle the scale.”
And she says they have been fortunate at Refinery29 to find and hire people who care deeply about the mission of their brand.
“When you bring people on board that really, automatically love the brand, when things get har, and they will inevitably get hard, it actually helps those people to deal with the issues that arise and recover quickly.”
Gelardi also believes that hiring new staff members who have that entrepreneurial spark inside them helps the brand thrive.
“The industry that we’re in is ever shifting. The work that we do is ever shifting,” Gelardi says. “I think it requires that level of entrepreneurial creativity in order to really be able to roll with things and to find the solutions.”
Establishing a Legacy
Much has changed in the 15 years since the four founders first tossed around the idea for Refinery29. Especially on the internet.
What once felt like a wide open space, now feels more like an overstuffed room pumped full of noise. Because of this, von Borries believes people have begun seeking more intimate, offline experiences, something Refinery29 is working to supply.
“We were always doing events,” he says. “Back 15 years ago when we launched Refinery, we would host local events at stores and boutiques and would bring people together. We’ve always been thinking about the real world, and when you do something in digital, the real world is very validating.”
One such example of Refinery29 IRL is 29Rooms, an art exhibition that features 29 collaborative spaces touching on topics meaningful to readers, such as virtual reality, body positivity and music.
At the end of the day, all four founders are focused on building a legacy they can be proud of.
“You can’t have a media company, I don’t think, without having a really true understanding of what it is you want to leave behind someday,” Barberich says.
And she believes that today’s world, with its renewed focus on social justice, women’s rights, and political activism, is the perfect place for a platform like Refinery29 to thrive. Now more than ever, people are seeing unmet needs, especially in areas of representation and diversity, and feeling driven to meet those needs.
“I think the motivation to start a business is fairly universal,” Barberich says. “You feel that there is something missing. You feel that there is something missing and usually, you’re not the only person.”
She encourages those who feel that tug not to ignore it, but to step out boldly.
“When that happens, you have to really face the facts that this is going to be scary. It’s going to be a ton of work. You’re going to make mistakes. You’re going to need the help of a lot of people, and a lot of times you’re going to need their help for free, and you have to be able to ask for that help, so great relationships really make a difference.”
When looking at Refinery29, that was certainly the case. If one thing made Refinery29 what it is today, it’s relationships.
The relationship built between two high school friends. The relationship between a mentor and her intern. The relationship between a couple that brought them all together. And the relationship between a business and its audience—a two-way exchange of encouragement and authenticity that has amplified the voices of women for 15 years and will continue to do so into the future.
Direct download: FP252_Refinery29.mp3
Category:general -- posted at: 5:42pm AEST
Thu, 23 May 2019
251: How a Humble Typewriter Salesman Started a Software Company Now Worth Billions, With Red Hat Co-Founder Bob Young
The Open Source CEO
Bob Young’s journey from renting typewriters to co-founding an open-source software company to founding a self-publishing platform.
Entrepreneurship carries a lot of prestige these days. But back in the 1970s, when one freshly minted, Canadian college grad decided to start his own business, the only real perk was a business card that read, “Bob Young: President” that he could show to his mom.
This, Young explains, was the single greatest benefit of starting a business back then. It wasn’t about the money, the eager investors, or the thousands of devoted fans (he didn’t have any of those). He just hoped he could reassure his mom that she didn’t have to worry about him anymore.
“We now have the smartest kids in our high schools going to college to study entrepreneurship,” he says. “Whereas, back in my day, all the smart kids went and got ‘real jobs’ as lawyers or accountants or whatever and became CEOs of big corporations, and it was us dumb kids who started businesses because no one would employ us.”
For Young, that meant printing up a fancy business card and, with a little money from friends and family, buying a small, failing typewriter rental business for cheap.
From there, though, things got interesting. Young quickly pivoted from typewriters to computers, until a mid-career stumble led him to the world of open source software, a field in which he thrived. Young has since gone on to found Red Hat, a multinational company that offers non-proprietary software solutions to businesses. In 2018, IBM announced it would acquire Red Hat for around $34 billion.
Today, Young is at the helm of a few businesses, including self-publishing platform Lulu.com, continuing his passion for democratic, open distribution models that favor the little guy. But despite his 40 years in entrepreneurship, he still lists just a single skill under “Specialties” in his LinkedIn bio: typewriter sales.
“I’m a typewriter salesman, and that is the value I bring to the companies that I’m involved with,” Young says. “I’m a sales and marketing guy, and I have to hire smart accountants and smart engineers and smart product managers, because those are skills that I don’t have. My one contribution is in the sales and marketing side of the projects I’m involved in.”
When Success Turns Sour
Young realized almost immediately that his first business had to evolve, and fast. Shortly after he bought the typewriter rental business, he dug through old customer records to find those listed as inactive, and began calling them to try and entice them back into the fold.
One of the businesses that had often rented typewriters from the previous owner was a phone company called Bell Canada. After speaking with the office manager, a sweet woman who invited him to come visit even though, “when you come by all I’m going to do is show you why I don’t need your services anymore,” Young headed off to downtown Toronto to meet with her.
As she walked him through the open-plan office building, he saw several hundred employees, who only four years previously had used rented typewriters, at work in their cubicles. They were all staring into computer screens.
“We then, immediately of course, got into the computer equipment rental business,” Young says, laughing.
He managed Hamilton Rentals from 1979 until he sold it in 1984. He then founded Vernon Computer Source, another equipment rental business, that same year.
In 1992, Young was on cloud nine. He had just sold his second computer rental business to technology services company Greyvest Capital, Inc., mostly for shares in the company, and took a stable, comfortable job there.
Then came NAFTA (the North American Free Trade Agreement), which eliminated tariffs between the United States, Mexico, and Canada. That led to financial troubles for Greyvest, and suddenly Young’s life ceased to be as stable as he’d expected.
“In ’93, I found myself in Westport, CT, unemployed with a net worth of something less than it had been when I graduated college 15 years earlier, only now I had three children, a wife and a big mortgage.”
Just as Young had made his next big step forward in his career, it had all come crashing down around him. But looking back on this time in his life, Young is grateful for this heartbreaking failure, because he links it directly to the birth of Red Hat, Inc.
Trying on a New Hat
Shortly before its demise, Greyvest sent Young to New York to pursue the Unix workstation (a special computer designed specifically for scientific or technical endeavors) market, asking him to get to know the users in the big financial services companies and engineering companies in and around the city. Greyvest was in pursuit of new rental and leasing customers, and this was precisely what Young did best.
To accomplish this, he had been attending evening user group meetings and offering a helping hand. He had even started a modestly sized newsletter.
But when the bankruptcy of Greyvest forced him to walk away from the computer rental business for good, his goals shifted. What if, he wondered, he could transform his newsletter into something more?
As Young explains, the true value of an online newsletter doesn’t lie in the subscriptions. It’s all about the mailing list. Products of value to those particular customers can be marketed and sold using the list. And so, ACC Corp. was born, and through it, Young transformed his mailing list into a catalog filled with programs and software that catered to his audience: the ACC PC Unix and Linux Catalog.
Linux and Unix were two similar but competing operating systems initially released in the early 1970s. The major difference? Linux was free and open sourced. Unix was not.
Through the catalog, he had the greatest success in the sale of Linux-based products, so when he asked his customers to share what else he could add to his catalog, and they directed him to a tiny project filled with potential called Red Hat Linux, he was intrigued. Red Hat Linux promised to be a new and improved version of the Linux Young’s customers already knew and loved, so Young knew he needed to check it out.
Young called the creator, Mark Ewing, who was working out of his spare bedroom and his own bank account, and asked him to send over 300 copies of Red Hat Linux for him to sell through the catalog.
Young questioned Ewing’s hesitation to do business with him. Ewing explained that he had only planned to manufacture 300 copies of Red Hat Linux in total.
Young meshed his big dreaming style with Ewing’s engineering prowess, and the two co-founded the version of Red Hat, Inc. that still thrives today.
He had taken a circuitous route to the software industry, but he was grateful that he finally arrived when he did.
“Whether it was Steve Jobs or Bill Gates, they’re both contemporaries of mine and it’s been fun sort of growing up in the industry watching those guys be successful,” he says. “I was late to the party of success, but I was pleased with Red Hat’s success.”
Young served as the company’s CEO from its founding in 1993 until shortly after the company went public in 1999.
“Once we became a public company, and we had 400 employees, I realized I’d never worked for a company of 400 employees, much less managed one,” he says.
As he faced down the wild host of new rules, regulations, and responsibilities that came with being CEO of a public company, Young recognized that the best thing he could do to ensure the company’s success was to embrace his own weaknesses and step away.
“One of the tricks to being successful is to be self-aware,” Young says. “None of us—no human being—is anywhere close to being perfect. In fact, I’d argue that most of us are barely adequate, even among the most successful of us. But if you know what you’re good at, and you know what you’re not good at, then you can build organizations that protect themselves from your failings.”
Young also recognized an entrepreneurial wanderlust stirring in his heart.
“I’m an early stage startup guy,” he says. “I really, really like the big idea, and I really like selling the big idea, but once I convince people that the big idea is worth pursuing, I lose interest in it and I’m looking for the next big idea.”
He explains that this is an excellent quality when you’re just starting a business and hunting for your great, big idea, but that, once a company is off and running, it can become a serious problem.
“Repetition and precision are things I do not do,” he says with a chuckle. “I never have done. This is why I was such a terrible student as a kid. My mind just doesn’t work that way. My mind works always on the next idea.”
So, he decided to call Matthew Szulik, who would become the next leader of Red Hat, into his office for a chat.
“Probably the biggest single contribution I made to Red Hat’s success was getting out of Matthew’s way and letting him turn our fledgling Red Hat business into the billion-dollar enterprise it is today.”
Although the time had come to bid Red Hat farewell, Young is still incredibly proud of their ongoing success.
“It was this wonderful adventure that worked out astoundingly well,” he says. “We weren’t sure if we could build a business there, but we knew if we could it was going to be a huge business, because open source—sharing your software, sharing binaries with your customers—was simply a better way of building software than the previous proprietary model that all the other software companies were pursuing at the time.
“To have that vision come true has been a bit of an out of body experience, and it gives me great pleasure,” he says.
And just like that, the co-founder of Red Hat was off on a journey to find his next big idea and turn it into a reality.
Open Source Publishing
Today, at just shy of 60 years old, Young owns the Canadian football team the Hamilton Tiger-Cats and serves as CEO of craft marketplace Needlepoint.com and chairman of drone company PrecisionHawk. But the endeavor he says he is currently most passionate about was one he founded in 2002—Lulu.com.
Through this print-on-demand self-publishing and distribution platform, Young wanted to revolutionize the publishing industry. He wanted to serve authors who write on niche subjects and catered to niche audiences. In other words, the ones that would be turned away by the traditional publishing industry, no matter the value the book offered to the market it intended to serve.
“We serve the interests of the author,” he explains. “The publishing industry is set up to serve the interest of the readers, and the author is just a cog in their machine.”
Young has a special passion for creators would otherwise get chewed up by “the machine,” no matter their industry. This is partly why he recommends founders consider platforms like Shopify to sell their products rather than relying on the “FANGs” (Facebook, Amazon, Netflix and Google).
“The consolidation we are seeing on the internet is making early internet pioneers nervous,” Young says, “because the whole point of the Internet was to bring more democracy—to put more control in the hands of the consumer, of the user of the internet—and we are seeing it move away from there.”
When a business owner sets up an Amazon store or a Facebook page to sell from, those customers no longer belong to the business owner. They belong to Amazon or Facebook.
“You want your customers to have loyalty,” he says. “The problem with setting up your shop on Amazon is Amazon is competing with you for the brand and the attention of the customers you’re sending to Amazon, and that’s not in your interest of building a strong brand for your product and your service.”
Young explains that when an author sends their customers to Amazon to buy their book, Amazon immediately begins recommending other titles in that subject to the customer before they have even been able to purchase the title they originally intended to buy.
“Amazon has just absconded with your customer,” he says. “Amazon is happy to have you as a merchant, because they want you to bring all your customers to Amazon so they can sell them other things. Shopify is the exact opposite of that.”
Rather than sending new customers to Facebook.com/YourBusiness, he urges business owners to start sending customers to YourBusiness.com. He also encourages founders to “pay attention to the principles behind the internet, not just the buttons that Facebook and Google give you.”
“The internet itself is this great, open vista, and if you build your market using the foundational elements of the internet, no one can ever take that away from you.”
He’s hopeful that the rising generation of founders and business owners will be savvy enough to navigate these stormy seas.
“As this next generation of entrepreneurs get going, they’re going to understand…you’ve got to be really careful about surrendering your customer to your supplier,” he says. “You want to find suppliers who are going to partner with you to build your business, not using you to build their business.”
Whether in the computer rental space, the arena of open source coding or his current realm of self-publishing, Young has always lived by the principal of democratizing access to the tools that build success.
Through collaboration and inviting more voices to the table, advancements come more swiftly, and this is a principal that even Young, a self-proclaimed “dumb kid” who started out selling typewriters, can embrace.
Bob Young’s Tips on Cultivating Self-Awareness
Bob Young says that he owes much of his success to self-awareness. By leaning into what he is good at and hiring others to cover areas where he struggles, this self-proclaimed typewriter salesman has found remarkable success. Young insists that even those who struggle with self-awareness can develop it, and these are three of his tips for harnessing that growth:
1. Put the Pride Aside
“So many of us are prideful,” Young says. “We worry about being criticized.”
But as founders, and as humans, there is always room for growth. Rejecting that evolution in favor of belief in our own mythology only prevents us from reaching our greatest potential. Young says that, in order to achieve any increased level of self-awareness, pride first has to be eliminated from the equation.
2. Listen to Critiques More Than Compliments
Once pride is silenced, it’s time to let the criticisms reach our eyes and ears, even though it may sting a little.
“We worry that people think we’ve made a mistake or that we’ve done something dumb,” Young says. “If you can flip that around and look at your mistakes as your biggest single learning opportunity that day or that week or that year, now when people criticize you, they’re more valuable to you than the people who compliment you.”
Choosing to embrace our own failings today, no matter who brings them to our attention, is the only way to make sure those same failures don’t repeat tomorrow.
3. Be Honest With Yourself
Young is comfortable with sharing the skills he lacks, especially in the area of customer support. He explains that, although he loves his customers, he cannot find the patience to help a new customer struggle through a problem he’s solved for 600 customers who came before.
He says that it took many years, and many, many customers pointing out this flaw, for him to internalize the criticism, but once he did, and once he genuinely considered the critique, he recognized that he and his customers would be better served if left that work to someone else. He says his brain simply isn’t wired for customer service, so he relies on those around him who are.
To maximize self-awareness, Young says we should accept what we are great at, grow where we are able, and rely on the talents of others to support us where we perpetually fall short.
Direct download: FP251_Bob_Young.mp3
Category:general -- posted at: 6:36pm AEST
Fri, 17 May 2019
250: How Dollar Shave Club Used Mission, Humor, and Viral Videos to Lead Up to a $1B Acquisition, With Michael Dubin
A viral video put Dollar Shave Club on the map, but it took a team to get it where it is today. CEO Michael Dubin talks about DSC’s growth, acquisition, and expanding product line.
It was the commercial seen round the internet. On March 6, 2012, Dollar Shave Club uploaded its first YouTube video, featuring one-and-a-half minutes of offbeat humor, during which founder Michael Dubin rides in a kid’s wagon, wields a machete, and encounters, among many other things, a person in a bear suit.
“Do you think your razor needs a vibrating handle, a flashlight, a back scratcher, and 10 blades?” Dubin deadpans while riding a forklift. “Your handsome-ass grandfather had one blade—and polio.”
It was a totally unique way to explain a simple concept: For an affordable fee, Dollar Shave Club subscribers would get quality razor blades delivered to their doorsteps on a regular basis, thus skipping the trips to the store for overpriced, gimmicky alternatives. And people loved it—the resulting traffic from the video’s launch crashed their site.
Since then, that commercial has been viewed over 26 million times on YouTube. It cost only $4,500 to produce, yet it launched the company on a trajectory that would later lead to a $1 billion acquisition by Unilever.
“It put us on the map, no doubt,” Dubin says. “We wouldn't be where we are without it.”
But this isn’t a story about Michael Dubin and his famous viral video. It’s not even a story about razor blades. As Dubin is quick to point out, getting DSC to where it is today required a team effort. And with its ever-expanding product line, today, the company is about so much more than a good shave.
Timing Is Everything—In Comedy and Business
They say the most important thing in comedy is timing; the difference between roaring laughter and painful silence can be a fraction of a second.
Maybe this was something Dubin learned during the eight years he spent training at New York City’s Upright Citizens Brigade, an improv theatre with notable alumni such as Saturday Night Live’s Horatio Sanz and Amy Poehler. While taking improv classes, Dubin worked various media jobs, starting as a page at NBC, then moving into production and news writing at MSNBC, and eventually, getting into digital marketing at SportsIllustrated.com.
But it wasn’t just Dubin’s punchline delivery that set DSC up for success out of the gate. Even the timing of its launch was strategic. As Dubin told NPR’s Guy Raz in a “How I Built This” interview, he chose that specific date—March 6—because, with his media background, he knew that news outlets would be hungry for a tech story leading up to the annual South by Southwest conference that takes place in Austin in mid-March. The launch date also coincided with Dollar Shave Club’s announcement of its $1 million seed round.
It Takes a Team
A viral video can be a major boost for any company, but it’s far from the secret to a successful business. For that, you need great people, and assembling them is easier said than done.
“Big business is a team sport,” Dubin says, “and it requires talent from all corners of the universe that will help you build what you're looking to build.”
Knowing where to find your future teammates can be a challenge.
“Finding great talent is always going to be the hardest thing that any entrepreneur does,” Dubin says. “Because, ultimately, there's somebody out there in the marketplace that can help you do your job really well and help you build your company the best way possible. But you've got to go out and find them in the great wide world.”
That’s why Dubin is a fan of recruiters, “because recruiters are paid to have knowledge of the network that you're looking in.”
When building his team early on, Dubin had just moved from New York to Los Angeles and lacked a network in his new city, so he relied on his early investors to make introductions. “That's a great reason to take investment—besides, obviously, needing to take it to drive growth and invest where you need to.”
To attract the right talent, Dubin recommends founders do two things. First, focus on your company’s mission. What are you trying to achieve? What gaps in the market are you trying to fill? Why do you come to work every day?
“Really talented people want to work for companies that have purpose,” he says. “And that's defined in the mission of the company.”
Second, consider granting employees equity. “People want to feel like they're participants in the success—if you ultimately do have the success—and that's super meaningful.”
And if your mission changes, that’s okay. It’s natural for it to evolve as your company grows; that’s certainly true for Dollar Shave Club. “It started out more as a shave-only proposition,” Dubin says. “And then it grew out into becoming…more of a men's health, more of a men's grooming platform.”
What’s their mission today? “Help guys take care of their minds and bodies so they can be their best selves.”
Growth, Acquisition, and Expansion
Taking on the shaving industry was a gutsy move. To put that into perspective, it was around the year 1900 that King C. Gillette invented the world’s first disposable razor, according to Gillette’s website. So when Dubin decided to disrupt the shaving market, he was going up against a company that had already been in it for over 100 years.
Eight months after the launch of its first commercial, Dollar Shave Club secured a Series A round of $9.8 million. And two years after that, the subscription razor blade company hit 1 million members.
In July 2016, Unilever acquired Dollar Shave Club for a reported $1 billion. At the time, DSC had 3.2 million members and was expected to exceed $200 million in turnover (which is sometimes defined as net sales and sometimes defined as revenue) that year. Dubin stayed on as CEO and continues to serve in that capacity today.
“Unilever's been very good to let us run the company our way,” he says, “and that was part of the design.”
Today, Dollar Shave Club boasts over 300 employees and continues to expand its product line and global footprint. Beyond razors, DSC now sells cologne, body wash, shampoo—even flushable toilet wipes (they’re called One Wipe Charlies). It also has sites live in Australia, Canada, and the UK, with plans to expand further in the next couple of years.
Knowing When It’s Time to Add a New Product
For a long time, razor blade subscriptions were Dollar Shave Club’s bread and butter, and it gained a loyal following with its single product line. But growth almost always means product expansion, so how can a founder know when it’s the right time to add new products?
“You have to stay true to your core,” Dubin says. “You have to develop credibility in your core categories before you can expand outward. There is such a thing as doing that too fast.”
Timing matters. Move too fast, and you could confuse your customers and dilute your brand. Too slow, and you may miss your opportunity to take the market.
As for figuring out what your next product should be: ”You should definitely do your research. It's always a blend of gut and research.”
Time Well Spent
These days, Dubin doesn’t star in any viral videos, but he told Foundr about a recent, albeit lesser-known, YouTube video of his commencement address to the 2018 graduating class of his alma mater, Emory University. In it, he sums up the lessons he’s learned over the years, including one about “little choices.”
“They're the ones you make more frequently, maybe even every day,” he says to the graduates, “the ripple effects of which, I believe, actually have a bigger impact over the course of your life. They’re choices about where to invest your time.”
Given Dollar Shave Club’s meteoric success, it’s safe to say that Dubin and his team’s time has been well spent.
5 Entrepreneurial Lessons from Michael Dubin
Dollar Shave Club is a massively popular company that attracted a billion-dollar acquisition. What are some parting lessons we can take from this interview with CEO Michael Dubin?
Direct download: FP250_Michael_Dubin.mp3
Category:general -- posted at: 12:18am AEST
Wed, 8 May 2019
Raise your hand if you’ve experienced the all-too-common dilemma of wanting to read new books but instead falling slave to long hours and mindless digital content consumption. (I’m raising mine right now.)
Self-education takes time, and time is often the one asset we don’t have nearly enough of.
Well, Niklas Jansen found a way to give his customers more time. “Some of my friends and I didn't have time to read books, and we were working full time. We also noticed more people consuming content on their mobile phones,” he says. “We wondered, ‘Is there a smarter way to combine these two things?’”
This was the very question that Niklas Jansen and three of his friends addressed as they formulated the idea for Blinkist, a mobile app subscription that provides 15-minute insights from the bestselling books we all wish we had the time to read.
Today, Jansen and his team of 130 are bringing ideas from the best nonfiction books to some of the busiest people on the planet. Blinkist is paving a new path for modern content consumption and self-education, and they’re doing it in a remarkable way.
Jansen has been an entrepreneur since he was in college. He did consulting for a couple of years, but once the idea for Blinkist hit him, he dove right in and founded one of the most unique startups in Berlin. That was seven years ago.
As Jansen and his three co-founders developed the company, they each managed different parts of the business: content, product, operations, and marketing. (Jansen owned the product side.) The team tried to stay lean from day one, a decision they’re happy about today because, as they scaled Blinkist, they didn’t become distracted by a large team.
“We had to figure out so much every day,” Jansen says. Keeping the team small allowed Jansen and his co-founders to hustle every day, soaking in new knowledge by trying new things, reading voraciously, and talking to others. This process was especially important for Jansen, as he had no experience with product management prior to Blinkist.
Despite initial obstacles, it only took a couple of months to build the first version of the Blinkist product. To keep the development process simple, Jansen and his co-founders decided they only needed three things to get started: a mobile application, 50 nonfiction books to populate the app, and a marketing plan. “After five months, we were ready to launch,” Jansen says. “We were incredibly productive in that time.”
As the Blinkist team did their competitive research, they found that there was only one similar product on the market, but since it served a different audience and used a different business model, they weren’t worried. “We designed our content for mobile from day one in order to be different,” Jansen says.
Blinkist closed their launch day with five customers, “after our parents, of course,” Jansen says, laughing. To promote the launch of their product, the Blinkist team published a variety of articles in startup magazines and relevant websites. Jansen had high expectations for launch day. “I thought everything was going to explode,” he says.
The number of initial Blinkist customers was fewer than Jansen expected, but he still enjoyed watching people discover and purchase the product. “It felt good to watch it grow.”
And grow it did. Blinkist is now a worldwide product with major markets in the US, Canada, Australia, Great Britain, and Germany.
The leap from five customers to more than five global markets wasn’t an easy one. It took years of trial and error, but Jansen and his team eventually scaled Blinkist to a successful, profitable level.
With unique approaches to fundraising, marketing, and team management, Jansen has lots of valuable insights to share with aspiring founders.
As they built the company, Jansen and his team raised about $35 million from investors in the US, Germany, and other parts of Europe. They raised their first $300,000 as early stage, pre-seed money. If he could, Jansen isn’t sure that he’d do that part again.
“We felt a pressure to use it without having figured out a lot of things,” he says. He also suggests other founders be careful about taking on too much money too early. “Investors have expectations, and building a company takes time. Mistakes can be more costly if you have too much money in the bank.”
Of course, money can be helpful, but with too much, it can be tempting to spread your business too thin, too early. “If you can do one thing really, really well, that can be your superpower,” Jansen says.
Working from a small budget can also help you focus.
Jansen boils Blinkist’s marketing strategy down to one word: Sustainability. “It’s important that whatever you do in marketing to grow your company is repeatable,” he says.
For example, Jansen wouldn’t consider PR a sustainable growth channel. It might work a few times, but after one or two days, PR stops being effective. “Marketing needs to be able to be repeated and sustainable,” he explains. “You don't want to burn money for customers.”
As for Facebook and other social advertising, Jansen and his team know precisely how to target their customers and how much they’re going to spend on acquisition. Through different campaigns focusing on different creative elements, his team was able to conduct A/B testing and determine what the best parameters were.
They now apply those parameters to replicate successful campaigns. “It involves lots of mechanics and details, but once you find something that works, you can scale it,” Jansen says. “That's why we call it a ‘marketing machine.’ We automate as much as possible.”
Recently, Blinkist has started investing in TV advertising—a completely new channel for the company. “It’s very different from the others, but it’s exciting because now we’re part of mass marketing and mainstream media,” he says.
Additionally, Jansen and his team rely heavily on word-of-mouth marketing and customer stories to grow the Blinkist brand. “It’s a very shareable product,” he says. “People share stories about how they use Blinkist and how it improved their lives.” The team also polls customers and uses the feedback they receive to further improve the mobile app.
With such a robust strategy, one must wonder how the Blinkist team manages so many marketing channels. Contrary to what you might think, the team doesn’t outsource any of its marketing strategy or creative work.
Blinkist keeps everything in house, which is helpful for making lots of updates and changes to a campaign or strategy. “We want full control of the whole customer experience and what customers see from Blinkist,” Jansen says.
What started with the Blinkist co-founders testing various ads has turned into a team of six to seven tech marketing experts. Today, they manage their marketing by channel: Two managers for paid social (such as Facebook and Instagram), one for paid content (such as Outbrain), one for AdWords and Google, one for podcast and influencers, and one for TV.
The team also retains a creative team in house, including videographers, designers, copywriters. These folks work with the Blinkist channel managers, who develop audiences and strategies. These managers, in turn, go to the creatives for the right vision or creative assets.
A single, in-house creative team can be tough to share across an organization, but Jansen believes Blinkist has established a good model for dividing resources. “Some designers work directly with marketing. Video and copy are shared with other teams, but they do prioritize marketing needs.”
At Blinkist, this model works because the marketing sees faster duration cycles than the product teams do. Marketing has daily cycles of content production, whereas product managers deal with longer cycles of design-build-test-repeat.
The entire Blinkist team still resides in Berlin. “We haven't expanded offices yet,” Jansen says. “So far, we’ve established a global business, but we work out entirely out of Berlin.”
While Jansen doesn’t plan on expanding the Blinkist team outside the Berlin office, he is excited for the international growth of the Blinkist product. The team is currently pushing into brand new markets and eventually wants to expand to be a truly global brand.
They’re also making changes to how they select and source the content available on the Blinkist app, by selecting local curation from different markets. “We want to find what's popular in each market and be very local when selecting and curating content,” Jansen says.
He’s also aspiring to build out more original content under the Blinkist brand. Right now, the product is mainly focused on third-party books and authors, but there’s a potential to create a learning space and provide new content formats.
At the moment, Blinkist is a curation tool, but Jansen can see the product creating original content, not unlike what Netflix has done. “We know what users like and their behaviors and favorite topics,” he said. “We can use that data to make original content that our customers love.”
Above all, Jansen encourages other founders to stay on top of what’s happening. “Learn as much as you can,” he says, “whether through books or podcasts or Blinkist!”
Direct download: FP249_Niklas_Jansen.mp3
Category:general -- posted at: 12:15am AEST
Thu, 2 May 2019
The Sky’s the Limit
Space enthusiast, doctor, and serial entrepreneur Peter Diamandis on abundance, exponential technologies, and why the world is better than you think.
Ever since he was a child, Peter Diamandis has been looking up, literally and figuratively.
Captivated by the lunar landing in 1969, he’s spent much of his life pushing the boundaries of space exploration through his various companies. And as a proponent of the concepts of exponential technologies and abundance, he has a refreshingly optimistic outlook on the future.
“I believe that we're heading towards a world where we can uplift every man, woman, and child on this planet,” he says.
And as the founder of more than 20 companies in the fields of longevity, space, venture capital, and education—perhaps most famously the XPRIZE—Diamandis is doing his best to advance the world he envisions.
“I’ve always followed my passion,” he says. “And at the end of the day, that’s really the world that I feel extraordinarily lucky to live in, one where I am doing what I want to do.”
Exploring Medicine and Space
Born in New York to Greek immigrant parents who both worked in medicine, Diamandis felt obligated to become a doctor just like his father. But as a child of the 1960s who was fascinated with the Apollo program, he also felt compelled to explore space. So, he did both.
After getting accepted into Harvard Medical School, Diamandis co-founded the International Space University, which today has graduated more than 4,600 students from over 105 countries, and started International Microspace, a rocket company that was later acquired by CTA Incorporated.
Even after he obtained his medical degree, instead of practicing medicine, Diamandis continued building businesses, many in the area of space. He founded XPRIZE, a global contest whose winners include a team that developed the first non-governmental manned spacecraft; and Zero-G, which has helped people like Stephen Hawking, Buzz Aldrin, and Martha Stewart experience weightlessness in a modified Boeing 727 that performs aerobatic maneuvers at 32,000 feet (if you fancy a ride, the Zero-G Experience starts at $5,400 per person).
While Diamandis has worked hard to get here, he’s having a lot of fun too. “I've always been a 9-year-old kid pursuing my dreams,” he says.
Turning Science Fiction Into Fact
Looking at Diamandis’ long list of companies is a bit like reading synopses of science fiction novels. Space Adventures sends private citizens to the International Space Station to live and work alongside astronauts. Human Longevity seeks to extend the human lifespan through genomic and phenotypic data. And XPRIZE hosts multimillion-dollar global competitions to solve humanity’s most challenging problems.
There are some truly out-of-this-world inventions that have emerged from XPRIZE competitions that are worth noting here. To make space travel possible for private citizens, Mojave Aerospace Ventures designed a privately financed manned spaceship with technology that was licensed by Richard Branson for Virgin Galactic. To provide clean water to the underprivileged, the Skysource/Skywater Alliance invented an energy-efficient device that gleans water from thin air. To make healthcare more accessible, Team DMI created a device that can run hundreds of lab tests on one drop of blood, alerting the user within minutes if they have a cold, the flu, or even Ebola.
Diamandis says that XPRIZE helps address just one of his many passions: “How do I empower entrepreneurs to really go big and change the world?”
On Emerging Technologies and Abundance
Watch the evening news or read the newspaper, and the world seems pretty bleak. But Diamandis believes we have good reason to be hopeful. One of his most popular contributions is his concept of abundance, which he’s given a TED talk and written a book about. It’s the idea that technology is transforming scarce resources into abundant ones, quickly closing the gap between the haves and the have-nots.
Google, for example, has given the general public access to a storehouse of knowledge that history’s greatest philosophers, mathematicians, and scientists could never have imagined.
Further, exponential technologies—such as artificial intelligence, 3D printing, and virtual reality—have made it easier than ever to produce solutions at scale, solutions that, previously, only governments and massive corporations were capable of producing.
“Energy is a perfect example,” Diamandis says. Humans went from killing whales to get oil for lamps, to mining mountains for coal, to drilling the ocean floor for oil. Meanwhile, the sun bathes the earth in more energy than we could use in a year. An exponential entrepreneur, therefore, would find a way to use technology to efficiently harness the sun’s energy and distribute it to the masses.
Through the lens of abundance, Diamandis sees an opportunity for entrepreneurs to change the world, so much so that he created an exclusive community, Abundance Digital, that aims to do just that. He hosts monthly webinars and provides courses to inspire its roughly 3,000 members to think bigger, teaching them that “the world's biggest problems are the world's biggest business opportunities.”
Because of exponential technologies, Diamandis envisions a future where AI makes education and healthcare effectively free and available to all, where self-driving electric cars make using a car service cheaper than owning a vehicle—a future where nothing is truly scarce.
Finding Your Massively Transformative Purpose
Though Diamandis keeps his eyes to the sky, that doesn’t mean he has his head in the clouds. He acknowledges that every new venture carries the potential for failure.
When asked if he ever has doubts when starting a new business, he says, “Of course, I mean, I'm not insane. But it doesn't slow me down.” That’s because, though he recognizes entrepreneurship’s inherent difficulties, he draws strength from his unshakeable sense of purpose.
Diamandis recommends beginning every entrepreneurial journey with determining your “Massively Transformative Purpose,” or MTP. This is what keeps you going when the going gets tough; it’s the thing that, even if you do not succeed, grants you the satisfaction of knowing that your time was spent improving humanity.
“People have to understand why they're building their business,” he says. “If you're just trying to build a business to make money, I view that as sort of an empty pursuit, and when it gets hard, you don't have the emotional energy to push through and succeed.”
So what are Diamandis’ MTPs? He has a few: opening up space exploration to more people, extending the healthy human lifespan, and inspiring entrepreneurs to solve the world’s biggest problems. For an advanced entrepreneur, having three MTPs is fine, but Diamandis recommends beginners start with just one.
On Hiring a Team and Finding a Co-Founder
Behind every great entrepreneur is a great team, and Diamandis is no exception. He has a roughly 12-person “strike force” that works with him across all of his ventures. Each team member has been carefully selected.
“I don't suffer assholes or fools,” says Diamandis, whose rigorous hiring process is proof of that. To fill a position, he’ll sometimes run a global contest. The winners advance to a 60- or 90-day trial period, after which, the entire team has to vote them in, meaning there must be 100 percent acceptance.
“One person who's out of whack can send the whole thing careening,” he explains. “So it's really important that we operate as a team.”
While he uses the Kolbe test, which assesses conative skills, Diamandis doesn’t rely heavily on testing to make his choices, preferring to use the team interview process as a major determiner.
Ultimately, though, his hiring decisions boil down to one simple metric: He needs to genuinely like the candidate.
“If when we're in the meeting and that person is talking, if I'm, in the back of my mind, saying, ‘I wish this guy would shut up,’ that's not a good situation. On the other hand, if we're in a meeting and I'm saying, ‘Listen, I haven't heard from you. I really want to hear your thoughts,’ that's a good situation. So I need to respect them and want to hear what they have to say.”
Those same likeability and respect factors go into his selecting a co-founder or CEO. For every company Diamandis has started, he picked a co-founder or two to help him get it off the ground. Now that he has more than 20 companies, for some of them, he may step back and serve as founder and chairman and then either promote a co-founder to CEO or hire one to run the company.
Not one to rest on his laurels, Diamandis has his hands on many projects, including a new book he’s working on with Tony Robbins. “I'm doing a lot,” he admits, “but it's all driven by passion.”
As for work-life balance, for him, it doesn’t exist. “It's more about work-life integration,” he explains. “I am ‘on’ 24/7. I have two 7-year-old boys; I do my best to prioritize them, but there have been…too many days away, and so there is, for sure, the trade of time.”
That trade-off is a familiar one for any entrepreneur trying to make a difference, big or small. “I know some of the more successful Silicon Valley gazillionaires,” says Diamandis, “and it's brutal sometimes. But at the end of the day, it's living a life of meaning and a life of where you get to choose how you spend your time and the dent you want to leave on this planet.”
4 Lessons Every Visionary Founder Can Learn From Peter Diamandis
It’s one thing to want to build a lifestyle business, one whose sole purpose is to make enough money to support the way you live, but it’s quite another to want to build a business that changes the world. If you fall in the latter camp, here’s what you can take away from our talk with Peter Diamandis:
Be true to yourself.
“The most important thing you need to do as a founder of a company is know that you love what you're doing, and you're not doing it for your parents, for your friends, for your teacher, out of obligation. … You’re doing it because it is what you love doing.”
Know your MTP.
“What's your massively transformative purpose? What is it that keeps you going? Who do you want to be a hero to?”
“I teach that the world's biggest problems are the world's biggest business opportunities. If you want to become a billionaire, help a billion people.”
Harness exponential technologies to help people at scale.
“As an entrepreneur, you can choose to work hard 40 hours a week…and impact a hundred people, or you can work those same hours and impact a million people. It's your choice. The tools we have to impact the world are extraordinary.”
Direct download: FP248_Peter_Diamandis.mp3
Category:general -- posted at: 8:27pm AEST