Podcast Summary
Eventbrite's Unique Journey with Founders Julia Hartz and Kevin: Eventbrite's history includes its 2006 founding, Julia's 2018 IPO leadership, coronavirus management, and Kevin's new $200 million SPAC. The company processes over 130 billion events daily and serves nearly 10% of the world's population.
Key takeaway from this episode of Acquired is the unique story of Eventbrite, a company deeply intertwined with its founding husband-wife team, Julia Hartz and Kevin. This episode covers key moments in Eventbrite's history, including their 2006 founding, Julia's 2018 IPO leadership, and their current coronavirus management. Additionally, Kevin discusses his new $200 million special purpose acquisition company (SPAC), a potentially revolutionary way to go public. The hosts also share a request for listeners to help spread the word about the show by sharing their favorite episodes. Statsig, a sponsor of the show, was highlighted for its impressive growth, processing over 130 billion events per day and serving almost 10% of the world's population.
The PayPal Mafia's Influence on Stripe's Success: Building a strong team and learning from influential networks can significantly contribute to a startup's success.
The success of Stripe can be attributed to the strong interconnectedness and exceptional talent within its founding team, which includes individuals like Peter Thiel, Max Levchin, and Elon Musk. This group, often referred to as the PayPal Mafia, came together during the early days of Silicon Valley and shaped its landscape with their groundbreaking innovations. Kevin, one of the Stripe co-founders, was fortunate enough to be part of this influential network, having met Peter Thiel during their time at Stanford. The experiences and opportunities from this period influenced Kevin significantly and set the stage for his entrepreneurial journey. The story of Stripe's origins underscores the importance of building a strong team and being open to learning from various experiences and experiments.
The origins of e-commerce and online money transfer: Embrace new technologies and take calculated risks, even against societal norms or parental expectations, to succeed in e-commerce and online money transfer.
The early days of e-commerce saw innovative methods of online money transfer, which revolutionized businesses like eBay. Kevin Rose, an investor, got involved in this scene through a chance encounter and an earlier business success. The contrarian decision to invest in Internet-related businesses despite parental disapproval is a common theme among successful founders. A lesser-known story is the origins of Zoom, which grew out of PayPal's early experiments with platform expansion and international money transfer. Dave McClure, a key figure at PayPal, led the team that explored various ideas, eventually focusing on money remittance. This history illustrates the importance of embracing new technologies and taking calculated risks, even when they go against societal norms or parental expectations.
Identifying opportunities and persevering through challenges in entrepreneurship: Recognizing market gaps and staying resilient can lead to successful businesses. Serendipitous encounters can also play a pivotal role in entrepreneurial success.
The founding team of PayPal recognized an opportunity to disrupt the high-fee money transfer market dominated by incumbents like Western Union. They started Xoom, the first company to build on the PayPal API, with a mission to help immigrants send money back home more efficiently and affordably. Julia Hartz, a reader in her boss's wedding, met Kevin Sliwowski, one of Xoom's founders, at the wedding reception. Impressed by Kevin's natural presence and charisma, Julia became an investor and played a significant role in building the culture at Xoom and later at Eventbrite. Despite initial challenges, such as being dismissed by venture capitalists and losing initial investors when PayPal was acquired, Xoom managed to bootstrap its business and eventually secure funding from Peter Thiel and Sequoia Capital. The story illustrates the importance of identifying opportunities, persevering through challenges, and the power of serendipitous encounters in entrepreneurship.
Early career experiences shaped understanding of creativity, content, and business: David's background in internships and assistant roles at MTV prepared him for success in reality TV with Jackass, and his adaptability to new media landscapes led him to Current TV.
David's early career experiences, including his internships and assistant roles at MTV, shaped his understanding of the intersection of creativity, content, and business. This background served him well when he joined the team that brought Jackass to television, which was a groundbreaking moment in reality television and a precursor to the rise of YouTube and other digital content platforms. Later, David was offered a job with Current TV, a startup co-founded by Al Gore, which brought him back to the Bay Area and continued his trajectory in the media industry. Throughout his career, David's ability to identify opportunities and adapt to changing media landscapes has been a key factor in his success.
Seizing Opportunities and Combining Skills: Follow your passions and values, and be open to new opportunities. Collaborating with talented individuals in complementary fields can lead to unexpected success.
The speaker's experience of working in Silicon Valley and Hollywood during different periods of time showed him the stark differences between the tech and media industries. He felt that he was in the wrong industry due to his priority on velocity and the opportunity to create ideas quickly. However, a chance encounter with a potential co-founder at a wedding led to the formation of Eventbrite, where they could work together and combine their skills. The speaker's experience highlights the importance of seizing opportunities and the magic that can come from working with talented individuals in complementary fields. The speaker's story also underscores the significance of following one's passions and values, even if it means making a significant change in one's career or personal life.
Unconventional partnerships and shared vision: Unconventional partnerships, a shared vision, and a willingness to take risks can lead to the formation of successful startups
The early days of PayPal were marked by unconventional partnerships and a shared vision for the potential of a payment platform. The founders saw PayPal not as a parasite on eBay, but as its first vertical. They believed in the power of PayPal's API and its potential to power various industries. Julia's encounter with a neglected customer support queue for an early event ticketing product sparked the idea for Eventbrite. When Kevin presented her with an offer that seemed too low, he encouraged her to bet on themselves and their idea instead. They moved quickly, starting the company in a phone closet with a shared sense of optimism and a mutual love for taking risks. Their partnership and complementary skills led to the formation of a community of successful startups in their building, including Eventbrite, Zynga, and Trulia. The lesson here is that unconventional partnerships, a shared vision, and a willingness to take risks can lead to great things.
Bootstrapping Eventbrite for Two Years: Eventbrite's founders focused on product development and customer needs, bootstrapping their company for two years without external funding, and identified a gap in the market for a self-service ticketing platform for micro-events, leading to organic growth and success.
Eventbrite's founders, Julia Hartz and Renaud Visage, decided to bootstrap their company for nearly two years without external funding, focusing on product development and customer needs. They identified a gap in the market for a self-service ticketing platform for micro-events, which was not being addressed by larger companies. With a strong belief that capital can hinder a company's focus on its customers, they built a great product organically through a remote team, with minimal infrastructure requirements. Initially, their earliest adopters were tech bloggers and people in the tech community hosting in-person events. The business grew through word-of-mouth, SEO, and organic adoption, with events like speed dating and TechCrunch Disrupt adopting their platform. Despite the lack of initial investment, they were able to identify a lucrative market and focus on building a product that met the needs of a wide range of event creators.
Eventbrite's early success from user-generated content and organic growth: Despite challenges in convincing investors of the market's potential, Eventbrite continued to innovate and adapt, eventually securing funding during a time of economic uncertainty.
Eventbrite's early success came from its user-generated content and organic growth, even before the team sought external funding. The company's focus on creating an efficient platform that could attract creators, sell tickets, and convert attendees into merchants led to a snowball effect. However, convincing investors of the market's size proved challenging due to the largely offline nature of the events industry. The Internet provided an opportunity for niches to become large markets, but it was difficult for VCs to see this potential at first. Despite facing rejections from 27 venture firms during the economic collapse of 2008-2009, Eventbrite continued to experiment with new technologies like Facebook and Twitter to amplify their platform. Eventually, Sequoia Capital and Rulof identified the lift in the market and invested in Eventbrite during the fall of 2009. The company's ability to adapt and outmaneuver traditional industry leaders during times of dislocation demonstrates the power of innovation and hustle in the face of change.
Unlocking value for the long tail of creators: Eventbrite's success comes from making event planning easy and providing tools for creators to succeed, tapping into the growing market of live experiences.
Eventbrite's success lies in unlocking value for the long tail of creators by making event planning frictionless, and focusing on providing tools and excellent service to enable their success. The market size for this creator economy was difficult to quantify in the early days, but the platform's data provides valuable insights for both Eventbrite and its customers. The need for humans to gather and the shift from traditional media to live experiences have driven the growth of Eventbrite, which allows users to showcase their interests and identity through the events they attend. Vanta, a leading trust management platform, is an excellent example of a business that automates time-consuming security and compliance efforts, demonstrating the potential for technology to streamline and enhance various industries.
Outsource non-essential tasks for value-added focus: Companies should focus on core competencies and outsource non-essential tasks like compliance and security to specialized services for efficiency and expertise.
Companies should focus on what truly adds value to their product and outsource non-essential tasks, like compliance and security, to specialized services. Vanta, for instance, streamlines this process by providing a single software solution that automates compliance and security reviews, saving organizations countless hours of work. Jeff Bezos' philosophy of focusing on core competencies and outsourcing the rest aligns with this approach. Regarding Vanta's growth, the company had long-term plans to go public but waited until they reached specific revenue and profitability thresholds. The IPO process was a lengthy one, with much preparation required beforehand, but Julia, the CEO, saw it as an opportunity to showcase the company's creators and customers to investors, ultimately leading to a successful public debut.
Going public: An unforgettable journey: Despite challenges, our company successfully went public, creating unique experiences that can't be replicated in virtual roadshows.
Going public was a challenging and unforgettable experience for our company. We aimed to make it an additive process that improved our operations and aligned with our identity. Despite numerous obstacles, including travel disruptions and intense competition, we managed to "stick the landing" and go public on a successful day. The roadshow itself was filled with unexpected adventures, from hurricanes and minivan rides to late-night arrivals and memorable meals at Friendly's. While the virtual roadshows of today save resources and time, they lack the unique and memorable experiences that came with our in-person journey.
IPO milestone for Eventbrite with lack of female representation: Despite the absence of women executives during Eventbrite's IPO roadshow, Julia Hartz felt supported by male allies and mentors. The IPO marked a new beginning for the company, which faced challenges with overspending and inefficiency during private fundraising periods.
The IPO process for Eventbrite was a significant milestone for the company, marked by the launch of a donut wall and the presence of family and key team members. However, Julia Hartz, the co-founder and CEO, was the only woman executive present during the roadshow meetings with portfolio managers of long-only funds. Despite this, she felt supported by her male allies and mentors, including Kevin Hartz and key investors like George Lee, Noah Wintrob, Ian Smith, and Harry Wagner. It was clear to Julia that it was time for her to step back and let Julia take the reins as CEO. Additionally, the most challenging fundraising periods for Eventbrite occurred privately, and the company faced struggles with overspending and inefficiency. Overall, the IPO represented a new beginning for Eventbrite, despite the lack of female representation during the roadshow.
Navigating public markets as a founder and dealing with unprecedented challenges: Founders must be disciplined in capital allocation and embrace struggles to find silver linings, even during unprecedented crises, leading to innovation and growth.
Navigating the public market as a founder requires discipline and the right mindset towards capital allocation. This was a driving factor for Eventbrite's decision to go public earlier and learn from experienced investors. However, the COVID-19 pandemic presented unprecedented challenges to Eventbrite as a live entertainment and ticketing business, resulting in a near-total halt of operations and a significant financial impact. Despite this, Eventbrite's leadership, led by Julia Hartz, made extraordinary decisions to shore up the balance sheet and weather the storm. The experience underscores the importance of embracing struggles and finding the silver lining in the worst-case scenarios, as outlined in Ben Horowitz's "The Hard Things About Hard Things." The pandemic forced Eventbrite to adapt quickly and innovate, ultimately leading to new opportunities and growth.
Navigating Business Disruptions: Eventbrite's Response to COVID-19: During crises, focus resources, pivot, integrate, and emerge stronger. Eventbrite downsized, shifted focus to self-service, helped small businesses online, and integrated with Zoom. Being a public company aided fundraising and long-term shareholders.
During times of massive business disruption, companies must make tough decisions to focus their resources and prepare for the future. Eventbrite, facing a revenue drop from 100% to 0% due to COVID-19, downsized by 45% and removed over $100,000,000 from operating expenses. They focused on their self-sign on channel and self-service platform, pivoted to helping small businesses survive online, and integrated with Zoom. Being a public company allowed them to raise significant funds and have dedicated long-term shareholders, helping them play offense and emerge stronger. Through these challenges, Eventbrite is now focused on building a stronger platform, creating a superior product experience, and helping customers reach broader audiences through online events. It's a new lease on life after a near-death experience.
Focusing on core business and providing value leads to growth: During tough times, focusing on core business and adding value to customers can lead to significant growth and market leadership. Examples include Crusoe Energy Systems and Eventbrite.
During challenging times, focusing on the core business and providing value to customers can lead to significant growth and market leadership. The discussion highlighted Crusoe Energy Systems, a clean compute cloud provider that uses stranded energy to power AI workloads, offering better performance and cost savings. Eventbrite, a ticketing platform, faced hardships but saw an opportunity to simplify the process for venues and retire inefficient competitors. The a plus scenario for Eventbrite is becoming even more ubiquitous in live experiences, having a clear market leadership, and being a company with a team of heroes. Listeners interested in supporting Eventbrite can visit crusoecloud.com/acquired. The resilience and excitement expressed by the founders, Kevin and Julia, remind us of the energizing feeling of starting a new venture.
Supporting local communities through arts and events, even in times of crisis: The human desire to connect and create new cultural movements remains strong during crises, and platforms like Eventbrite offer opportunities for virtual gatherings and engagement.
The importance of coming together and supporting local communities, particularly in the context of the arts and events industry. Eventbrite, as a platform for hosting online events, represents a way to continue gathering and engaging with others during times when in-person events may not be possible. The hosts drew an analogy to the 1918 pandemic and the subsequent roaring twenties, emphasizing the human desire to be together and the emergence of new cultural movements during times of recovery. As a bonus, the hosts mentioned an upcoming venture by a guest, Kevin, involving a Special Purpose Acquisition Company (SPAC) that aims to take a unicorn or unicorn-like company public. For those interested in learning more about company building and investing, The LP Show offers exclusive content through subscribing and attending monthly Zoom calls.
