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Finally when I needed an agreement written recently you know who I used? Walker Corporate Law. Walker Corporate Law is the firm that founders use when they raise money or when they’re selling their businesses. But Walker Corporate Law helps me with any legal issue I have or they refer me to someone who can. So when you start up go to Walker Corporate Law and have them in your corner as you grow your business. Alright let’s get started.
Hey there freedom fighters. My name is Andrew Warner and I’m the founder of Mixergy, home of the ambitious upstart and the place where now over 800 entrepreneurs have come to tell you their stories, teach you what they learned along the way and really empower and arm you so you can go out there and build your own success story and hopefully after you do that you’ll come back and do what today’s guests are doing which is share what you learned along the way.
So imagine, imagine that you’re working on a side project and a few months later it’s acquired by Google. That’s what happened to today’s guest. In May 2010 Kurt Wilms co-founded Ffick which generated movie reviews based on its analysis of Tweets. In January of the following year it was acquired by Google. I invited Kurt here to talk about what happened. Kurt, welcome.
Kurt: Thanks Andrew. Glad to be here, thanks for having me.
Andrew: Thanks for coming back a second time. This morning we recorded from your apartment and for some reason that didn’t work out so we went to Google’s office to record again this evening, thanks.
Kurt: Yeah, no worries.
Andrew: So I did some research and I went back and saw the old Tech Crunch article from the acquisition and I’m wondering how did it feel? I know from the outside what all of us saw when the announcement came that you guys were acquired within months. But from the inside, for you, how did it feel to be acquired?
Kurt: I mean it’s an awesome feeling. Kind of at that point when the public kind of knows you’ve been talking and dealing with it for a long time. So for us it was a sort of a month or two or three month process. So kind of there’s also a feeling of relief when an acquisition actually happens that it’s finally all wrapped up and everything’s good to go. So it was exciting, it felt good, but also a little bit of relief.
Andrew: How did your life change afterwards? I mean, personally. We’ll get into the business but personally what happens?
Kurt: It’s kind of funny. You, for me you end up, I work at Google now and to be honest I’ve just gotten a lot more busy. A lot more work stuff at Google. You read stuff on Tech Crunch and it sounds like it’s a lot of like fame and fortune, but it’s really like the work keeps going. To be honest like not a whole lot’s changed personally.
Andrew: I remember after Bradford and Reed that I went on vacation and I did this jetski thing with a whole bunch of people. And at the end of it I thought, this is fun. Hey can I please do this one more time for another hour, just me? And I didn’t, I realized as I said that to the guy who was the instructor who was leading us through, I said, I don’t have to care about the budget of how much this costs now, it doesn’t cost this much, I don’t have to think about where I have to be afterwards. That realization made me feel so incredibly free. I listened to my MP3 player later on, again on jet skis, just feeling that freedom and letting it fully sink in. Did you have a moment like that yet?
Kurt: To be honest, no. So it’s kind of like full speed. After we were acquired basically we had a week off and then we started, the whole team started at Google. And then when we started here obviously there’s a lot of ramp up, you’re learning a lot, there’s so much to do. So to be honest, no, there wasn’t a whole lot of like freedom or any kind of things like that but a lot of work. There’s a lot more work to do.
Andrew: And when you came up with this idea you were working where?
Kurt: Oh, let’s see, so to go back in time a little bit, I was working at Digg.com for a long time, almost four years. From early 2007 until 2010. And so, while I was working there I came up with this crazy idea to mind Twitter and to build this site Flick. So in 2010, I left Digg, and with a couple of other co-workers from there, and we started this site, Flick.
Andrew: And so you weren’t building this while you were at Digg. Weren’t you starting getting this together while you were at Digg? Yeah, you were.
Kurt: Yeah, so, I was experimenting with Twitter data, sort of on my own time at home, and being like, “Oh, this is really cool stuff.” And, previously, I’d worked on something called Movie Lens which is a movie review site that’s more traditional. Something like Rotten Tomatoes, where you go on the site, you rate movies, all that sort of stuff. And so, I had that experience, and sort of in my head, when I was not working on Digg, I was like, in my head like, “What would it be like if I tried to recreate Movie Lens?” But using Twitter data, so Twitter data was kind of the “hot thing” at the time back then. And so what I tried to do is I tried to basically build some basic stuff that would grab Twitter data and sort of build a movie review site. And the more I’d work on it and just fiddle around with it for my own personal use, the more I was like this could actually be a real company or real competitor to a site like Rotten Tomatoes or Flixster. So yeah, I was fiddling around with it a lot and then eventually I was like, you know what? I can just leave Digg and do this full-time, and so I kind of pulled the trigger and did that, and convinced some of my other co-workers at Digg to come join me.
Andrew: Why not do this on your own?
Kurt: Let’s see, I mean, a couple reasons. One, I believed in the idea. I thought it was really cool. A lot of people I was showing the idea to were sort of validating it, and being like, “Oh this is so awesome,” and they were encouraging me to sort of go. I guess there’s some amount of like, when I tell people, they’re like, “Wow, you’re crazy, you were working at like a hot startup? You’re going to leave and go do your own thing?” But it’s kind of a hard thing to explain to someone who’s never done it, but when you’ve built something from scratch, and you put a lot of effort into it, a lot of times you don’t want to see that thing die and you want to basically give it a shot.
And so for me it was like, I’d been working at Digg for four years, I really believed in this thing, I thought it was really cool, I thought it had potential to be an actual business. And so I was just saying to myself, “if I don’t actually try and turn this into a real legitimate Internet startup, I’m going to kick myself 20 years down the road.”
Andrew: Why did you need two co-founders? I mean, you were already experimenting with these ideas on your own. Movie Land, was that done by yourself?
Kurt: Yeah it was called Movie Lands, it was actually a research project out of the University of Minnesota, and so when I was working on that, I was basically making very, very small Tweets. Duet, it had been around forever. Why I started this with other folks? So basically my background is in software engineering, and I sort of convinced three other guys who had backgrounds in the things I’m not really great at to come with me. So this guy Ron, who’s just an excellent, excellent Ops guy, I convinced him to come, and he setup a lot of the servers and dealt with a lot of the infrastructure for dealing with consuming the Twitter firehose. And then I’m not really the best graphic designer, so I convinced a designer to come along and do all the sweet UI, and all that sort of stuff. And then finally, my friend Dobb, who’s a PhD. in Machine Learning, convinced him to come along and sort of do all the sedimend and analysis stuff, so we had a really good team. We were each sort of really good at what we did, and I think when you combine all of us together it sort of made, for something like our acquisition, where it’s kind of short term, really the team plays a big role in an acquisition like that. And so I think our strong team sort of helped basically one, gain initial attraction with the product and two, I think a lot of companies are looking to grab a solid team like that where, you’re working together. We were all working together at Digg too, so we had previous work experience, all that sort of stuff.
Andrew: How was the equity divided?
Kurt: That’s a good question. That’s always really tough at the beginning of companies to sort of setup. We decided as a group not to actually tell specific numbers, but, we… at a nice chunk of the company so everyone is really happy. Everyone came along in acquisition and everyone’s still working at Google all that sort of stuff.
Andrew: It seems like the idea was yours and then you brought them on, and you brought phenomenal people with you. Was it, 25% each? Was it equally split?
Kurt: Yeah, so the way I usually talk about it when I’m telling people is like, we all had what I call ‘founder equity’. Nobody was working like an employee. We were all basically cofounders. I took the role of CEO and ran with the product direction and all that stuff. Because it was my idea, I had started it. But definitely to convince those guys. They’re all high caliber engineers. They’re getting job offers all the time in the valley. To have them come along with me, I definitely gave them big chunks of the company.
Andrew: Giving big chunks of a company that doesn’t fully exist and isn’t yet talked about. It feels like it’s not enough to get people to leave. I hear a lot from entrepreneurs who want a great cofounder to finally quit his job and join them. Who wants someone who’s phenomenal to come and be a part of what they’re building which will be even more phenomenal, and it’s a struggle. You did it. How did you get not one, but what was it, it was three people to leave?
Kurt: Yeah. I think our experience was a little unique. Because we had all worked together previously. We all had a mutual respect for each other. I think it’s a lot harder and I hear this all the time too from other founders who are trying to get things going. It’s like, how do I find a really good cofounder? How do I convince someone to leave their day job and come work with me? To be honest, it is tough.
One of the things we had going for us is we knew each other in previous jobs, so we had a mutual respect for each other. Also, in this case with Flick, I built a lot of stuff and I was able to show them working things. It got their mind going. Like, yeah, this could be a real company. This could be a real opportunity. Which I think also helps a lot, to be honest.
So I tell entrepreneurs all the time to go all by yourself. Start building stuff. If you can’t build anything, start doing sketches, all this stuff. I think that can go a long way in convincing someone to come onboard.
Andrew: When you showed them what you had, before you had Ron to do these servers, before you had a designer, etc., what did it look like what you showed them?
Kurt: It was an iteration of how the product was. The first thing it was to be honest, is you run a little script on a server and you just see text. The first proof of concept was like, ‘Hey, I have a little piece of software here. It can look at the Twitter firehose and it can identify which tweets are about movies.’ That’s sort of how you start.
It started sort of base, like engineering. Then it got a little more sophisticated. Like, oh I can type in any user name and I can see what movies their friends tweeted. Then you can see in your head like, how cool that would be if you actually put that on a web page where you can just type in your own twitter name and you can see what all your friends said.
Andrew: About a movie.
Kurt: Yeah, that’s right. That’s how it all started. It started very engineery, very text. You, know filtering the tweets and all that stuff. Then once I got my friend Mark, who’s the designer, to come along. One of the things I did was I showed him the data, I showed him the text. I said, ‘Hey, check this out.’ Here’s what we’re doing. We want to put this into web form, and make it a cool consumer internet web app. I just let him run with it.
I think that did two things. One, the text and data showed him the potential of it. It also gave him the creative freedom to come on and own a big chunk of the product.
Andrew: James Caan, not the actor but the British entrepreneur in his fabulous autobiography said that his job as a founder was to paint blue skies. To show people the world as it’s going to be after he built it. Did you do any of that?
Kurt: Some of the stuff I just mentioned was in that same realm.
Andrew: What about this idea of I see how cool this is. But is there a business here? Is there an acquisition here? Is there a lot of conversation that’s going to happen because of this? Did you do any of that, to say, ‘Picture four months from now. We’re on Tech Crunch. This thing looks polished. Everyone’s going here to see what their friends are saying.’ Did you do any of that?
Kurt: Oh, yeah. When we were building it, we did all of that stuff to each other, Like, oh imagine this use case where a new movie comes out and Warner Brothers or Paramount and whoever is promoting Flick. Then imagine everyone coming to this page on Flick and seeing what their friends tweeted. Yeah, we talked about that stuff all the time.
Then when the business really got going and we were talking to VCs about funding, then we were painting the picture of like, oh, we’re not just going to do this for movies, we’re going to do it for music and books.
This public data is going to be the new way people consume. People aren’t going to go onto sites and create these side load accounts. They’re just going to talk about whatever they want to talk about in a public way. Then there’s going to be these sites that aggregate it all into nice packages, and we’re going to do that across all these different verticals. Yeah, we were doing all of those things.
Andrew: I kept hearing about the different verticals. Were you really thinking of other verticals? We’re going to do movies, then we’re going to do TV shows, maybe we do stock, it was.
Kurt: Yeah, we were definitely thinking about it, things got going pretty quickly. So our first acquisition offer was like a week after we turned on the site. So things got going pretty quickly. But yeah, we were planning on doing it the whole time. I guess once we turned it on, the movie studios were talking to us interested in what we were doing, tech companies were interested in what we were doing, so part of our strategy was like, “OK, let’s not go into other verticals too quickly here, let’s sort of take advantage of all the buzz we got around movies and see how far we can take that for a little bit, before we expand, and stretch too thin.” But we’re definitely planning on doing it.
Andrew: Now let me go back again, to the Digg days before we continue. The thing I was wondering is, Digg was a company, especially while you were there, that really had an incredible rise, incredible attention. How much did that influence your vision of what was possible for yourself?
Kurt: Oh, the Digg days really shaped who I am today. Especially as an entrepreneur. I think there’s a couple main things. One is, all the guys at Digg were all of them, from the top employees, from Kevin Rose, the founder, and Jay Allison, the CEO, to even the bottom, you know, junior engineers, there is like this entrepreneurial spirit inside of the company. I don’t know how to explain it. I mean, I think it stemmed from basically Kevin Rose, the founder. He was sort of like a serial entrepreneur, so while he was doing Digg, he was also doing another company called Revision 3, which was doing web video. At one point, he started another company called Pounce, which people might remember was like, a Twitter-style micro- blogging thing. So he was very entrepreneurial, and I think that trickled down to the employees, and I think that definitely stuck with me. So that’s one of the big things.
And two, there was a lot of energy inside the company that was like, “Anything is possible.” Myself personally, while I was at Digg, I felt like we were sort of helping shape the Web to where it is today. I think we did a lot of really cool things. Invented a lot of cool stuff. Sort of invented a lot of these trends that are happening, the Digg buttons on the site, you know, Facebook has the “like” buttons now, all this sort of stuff. And so, a lot of the sort of “spirit” inside of the company was like, “What can we do?” “What can we try?” like, “let’s throw spaghetti at the wall and see what sticks,” and yeah, I’ve taken a lot of that stuff away.
Andrew: That was huge, to suddenly see, sites, including major media sites, put a button of this little start-up that wasn’t even around years before on their site, that was huge. You said, “to see what stuck,” and I can see how that would get you to experiment and to not be afraid of failure. Do you remember any setbacks? Any ideas that didn’t work back then?
Kurt: One of the many first ones I remember in the Digg days was that we lost this feature called the Digg Toolbar. And what it basically did was when you clicked on a story, or a news story on Digg, you would go to the source site, but Digg would have a little bar, and sort of put the Digg count on top, and that was sort of the first feature that internally, we knew might not be that exciting for some of the publishers, and publishers might not like that. But we were sort of like oh, it seems like it might be a cool idea, the users might actually love it, let’s do it. And I remember internally that was sort of the first thing we did, where it didn’t turn out like we thought it was going to turn out. And I think the company eventually killed that feature a year or so later. But yeah, there was a lot of stuff that we did, but definitely that Digg bar was one that gets sited a lot as sort of the big thing we did internally.
Andrew: And how did it shape you to see that feedback?
Kurt: I mean, to be honest, this is probably not a good thing. For me, I saw it happen with everything, and kind of just shrugged it off, and been like, “Oh, it didn’t work out, um, we’re going to do the next thing?” And I don’t know personally if that’s such a good takeaway from Digg, especially now sort of like, looking at Digg now it’s sort of not as popular as it once was, not by any means. And I don’t know if that entrepreneurial spirit and that sort of, “let’s try what we can,” led to the demise or sort of the “downfall” of Digg.
Kurt: I just think a lot of the folks internally were like, “OK, we’re going to try what we’re going to try. If it doesn’t work, it doesn’t work. You can be a lot more thorough and more mainstream with your features, but Digg was always very progressive. Always pushing the [??] forward. When things like the Digg bar didn’t work a lot of us were like, ‘We’re going to try the next thing.’ I don’t know if users don’t like that change-a-version constantly, but it’s definitely something you should be mindful of if you want to try new features. Especially as an entrepreneur you want to try new things, and when you start getting a following, one of the takeaways is you have to be careful. You can’t assume your users are always going to keep coming back if you try crazy things they don’t like.
Andrew: It gets harder for a company that’s established to experiment than it is for one that’s trying to get its footing. When you were experimenting, were you constantly experimenting because you were thinking, ‘There should be a business here. I’m in the valley. I’m around all these creative people who are busting out hit after hit. I can find one if I tinker.’ Was that part of your thinking?
Kurt: It was in the back of my mind. I’m at Google now, and I still always think about that. The tech industry today, especially the Internet industry, and for me consumer Internet, because that’s what I’ve always been into, it’s crazy how much opportunity there is out there. The thing in my head that I always think about is all the people that have these smartphones and all the cool things that you could potentially do with those smartphones and all the people using them.
I don’t know how to explain it, but if you’re here in San Francisco in Silicon Valley and it’s part of the mental model everyone has, it’s like, ‘There’s all this stuff happening. All this opportunity,’ and it was definitely in my head when I was tinkering with the Twitter data back then.
Andrew: It is one thing to hear, it’s exciting when you hear about someone from nowhere who built a site like Digg who changes the way that we all interact with content and makes it to the cover of Business Week with this big [??], but when you know the person, when it’s someone who you maybe saw and knew before they even thought of this idea, it becomes so much more real, doesn’t it?
Kurt: It’s crazy.
Andrew: I’ve heard people say that with these interviews, that they’ll hear a guy who seems like them who suddenly came up with an idea, but to be in the room with that person. To watch that happen and grow. I could see why that would be inspiring. Here you are building and you’re thinking of leaving. What was the trigger that made you say, ‘We’re ready to go. It’s time to go on our own’?
Kurt: The guy I mentioned before, Jay Adelson [SP], he was the CEO of Digg for awhile, and he ended up leaving the company while I was still there. After he left the company, I showed him this thing, and by that point we had a fleshed out UI so you could see it on a webpage. I remember I was on Skype with him, and I was showing it to him, and he was like, ‘This is crazy. You could go out and raise VC money with this.’ That’s validation from someone that I respected a lot saying that to me. That was a trigger that flipped for me personally and I was like, ‘If this guy who I respect is saying this to me, then I can go do this. There’s nothing to be scared of. I can go get money.’ It was Jay telling me to do it.
Andrew: Did you wait until the product was finished or polished or any of that?
Kurt: No. I was like, ‘I’m going to do this.’ There was a period in between where I wasn’t working at Digg, and I was working on Flick before we launched it. It wasn’t fully baked yet, so I spent some time after I left working on it, but when you leave a job and something moves from side project to full time, you can spend a lot of time working on things.
When we were doing it on the side, you’re like, ‘It’s really good.’ Then the instant you leave and work on it full time, you’re like, ‘There’s so much to do.’ That’s another thing to think about if you’re working on a side project is it might seem like it’s ready to go but once you leave full time and you work on it, you’ll think of a million things to do.
Andrew: Why the difference? Same site, it’s just a different you. Why do you now analyze it differently?
Kurt: It’s a different you because it’s like all of a sudden this company, this business, this product is your livelihood and everything you do, for me personally, I want it to be perfect, and I don’t want the launch of it to go wrong. When it was a side thing, we’d just flip a switch and see what happens, but now that it’s full time, you don’t want anything to go wrong. You want everything to be perfect. You’re depending on this to generate income for you. If you have investors, you’re going to need to satisfy them. All that sort of stuff. When you go from side project to full time, there’s a lot to think about.
Andrew: How long did it take you afterwards roughly to launch?
Kurt: I think it was two months. Thinking back on it, it was probably the most intense work I’ve ever done. We all left around the same time, and we were working out of our apartment. We didn’t have office space, and we would meet, we would switch apartments. There’s four of us. We’d go to a different apartment every morning, and we’d meet up around 9:00 or 10:00 a.m., and we’d work straight until 2:00 or 3:00 a.m. until we couldn’t stay up anymore, and we’d just repeat that every day. We did that for a little over a month, almost two months, and then we turned it on after that.
Andrew: Was there anything that was, not an argument, but a debate internally? I know with two founders there can be big debates about an issue. With four, I imagine that it’s tougher. You’re nodding. What was it?
Kurt: Thinking back, it’s funny. At the time everything seemed, ‘Should we do this? Should we do that?’ To be honest, the formation of the company for us was the most [??] we ever had. You hit on it earlier with the equity. I think that’s the hardest thing for four founders to work out. From a product perspective and building it and turning it on. By that point we were working like a well oiled machine, and looking back it was so smooth. Once you get all the company formation, the hard conversations out of the way and you can just build, especially for us we had all worked together previously. It wasn’t that bad.
Andrew: April pre-interviewed you, and when she asked you, ‘What’s the first step that you took to launch the business?,’ I was surprised that you said that there were a few things that you did, but one of them was incorporate with an attorney and split the equity. A lot of entrepreneurs wouldn’t do that so quickly. Why’d you do that?
Kurt: That’s a good question. One, we were a little nervous about using the Twitter data and building the site off of other people’s stuff. Basically one is legal protection and being a company and making sure that if we were doing stuff we weren’t going to be personally liable. I also think for us it legitimized the business.
Andrew: It feels real when you leave your job and you have paper.
Kurt: That’s right. That’s the other thing is making it a real deal. Splitting the equity and getting past that. ‘We formed the company. The equity is finalized. We can move and focus on building a business now.’
Andrew: Another thing that you did early on was start showing it to investors. Why’d you do that so soon?
Kurt: We all left our jobs, and we wanted to make sure we’d be able to eat dinner and go to bed at night. We all saved up a little bit before we left, but we wanted to get a little bit of funding so we could pay for the servers, and we didn’t break our bank accounts. How it played out into the future, we only raised a very small amount from angel investors. We didn’t raise these big VC rounds you hear about. We showed it to investors early, but we ended up not taking a whole lot of money.
Andrew: How much money did you take?
Kurt: We took $50,000. Really tiny. In those early days we were like, ‘We’re going to take this money and we’re going to set it aside, and we’re just going to start another business.’ We were spending it on server costs. We weren’t even paying ourselves yet with the 50,000, which was crazy. When I tell that story to a lot of people, that’s the one thing people are like, ‘That’s awesome.’
Andrew: You lived off of the savings that you had?
Kurt: And the outcome of, ‘So you didn’t take any serious PC money when you sold. There wasn’t an investor getting a whole bunch of money. It was you guys doing your thing with that small amount of money.’ When I tell people the story they’re like, ‘That’s really cool.’
Andrew: Now that I’m in San Francisco I wonder how are you able to do it? I understand you can eat pretty cheaply here, but rent alone. I found the dumps for 2500 bucks.
Kurt: It’s a lot worse now in San Francisco than it was back then, but we were always banking on that it was going to get funding in six months or a year and we had savings. Obviously we had planned ahead a little bit, but it might have gotten a little crazy if we went for another six months without getting anymore money.
Andrew: Are you living in the same place where you lived before?
Kurt: No. I have a new place. Not because it’s ultra fancy or anything, just because I still [??] all that stuff.
Andrew: Because what? We lost connection for a moment there.
Kurt: [??]. I [??] do the [??] living with my friends [??] because of the [??].
Andrew: You moved out of your place because of the roommate situation. We recorded the video earlier at your apartment. You needed a place, from what I could tell, for your butler and the maid who are waiting behind to clean after we’re done with the interview. True?
Kurt: I wish.
Andrew: That was not a butler. We had a bad connection, so I couldn’t really tell what was going on. Before I continue, the connection’s really bad. Let me hang up and call you right back. Wait. There you are right there. You can see me, right?
Kurt: Yes. [??].
Andrew: Got a little fuzzy. Maybe it’s my connection that’s doing something funky. Who knows. At least we can hear each other. I’ll continue then. No more jokes. I’ll save whatever connection we have for the good stuff.
Here’s something that I noticed. The first version was really polished. Every time I ask a founder, almost every time, ‘What did the first version look like?’ They say, ‘Andrew,’ they wince and they say, ‘It was ugly, or it had issues with it.’ You guys have a very polished first version. Is that because you spent more time than most to get it right, or just because you had Mark, a great designer?
Kurt: I give a lot of credit to the designer Mark Hemien [SP]. Really solid. He did a great job. When I tell people about the story, I don’t think we spent a lot of extra time going through revisions of the design or revisions of the product. I think a lot of it was to Mark’s talent. He’s a really good designer. Mark Hemien for those of you guys who want to look up his work. He’s good.
Andrew: When you launched, you got into Tech Crunch, I think it was Jason Kincaid who wrote about you guys. I love Jason’s work. Every time I do research and I see one of his articles I feel like I’m going to get some good substance out of it. How did you get into Tech Crunch so quickly?
Kurt: We leveraged a bunch of our connections through Digg, but that was our only PR we planned out. Our idea was, ‘We’re going to launch on this day, and we’re going to get a Tech Crunch article, and we’re going to see how it goes. Some of the folks through the Digg network helped us get the Tech Crunch article. How it worked is we just showed them, we gave them early access to the site, and they checked it out, and they were like, ‘This is cool. We’ll write about it.’
Andrew: What happened after the Tech Crunch article hit?
Kurt: The Tech Crunch article hit, and it started a whole chain of events. We had all this incoming attention from all sorts of folks. I mentioned earlier a lot of the folks in the movie industry, every major studio emailed us and were like, ‘What you’re doing is innovative, really cool. We want to talk to you about it.’ Tech companies emailed us. I mentioned earlier after the Tech Crunch article hit, we had our first acquisition offer within a week, and it was crazy. Tech Crunch article drove a ton of traffic, but I think more it drilled a lot of incoming requests to partner with us or do different marketing things. It was crazy after the Tech Crunch [??].
Andrew: What kind of acquisition offer did you get?
Kurt: It was a company who was looking to do a movie type thing to one of their sites, and they were like, ‘What you’re doing is awesome. We want to do something just like it. How about we acquire you guys, and you guys come rebuild this for us?’ To be honest, that kicked off a whole series of talks that ultimately led to us coming to Google.
Kurt: Yes. The first acquisition offer was a week after we launched. Then the Google thing started a month, month and a half after we launched. After the Tech Crunch article, it was crazy. We also went down to all the movie studios, and we talked to all of them because they were interested in using Flick to market their movies, to get data about what people were saying about the movies, to get data about what people were saying [??] trailers. Then we were fielding questions from folks in the music industry, ‘We want to do this but for music.’ The Tech Crunch article was really good for us.
Andrew: I want to break down three of the things you talked about, the acquisitions that you got, the movie industry’s response and one thing that you didn’t, which is users. How many users did you end up getting?
Kurt: One thing we were doing, which was unique, and I think pretty cool, and I don’t think a lot of sites are doing it even today, is whenever you would tweet publically about a movie, we would store that data, and you would be in our system. We would generate a profile for you even if you had never used the site. That number was huge. Tens of millions of people on Twitter that talked about movies.
Andrew: You created accounts for them. They didn’t even need to create an account. You could activate it for them whenever they came?
Kurt: That’s right. Twitter.com, whatever your Twitter handle was you could type that in and you could instantly see what everyone you were following said about movies. When we showed the product off to a lot of people, that was the wow moment for people. It was like, ‘There is a whole set of information out there that’s all public that my friends are saying that I don’t even need to create an account.’ We had tens of millions. Anyone on Twitter who had mentioned a movie, we’d make an account for them, and then for people that actually came and connected through Twitter, I don’t remember the exact numbers, but it was up there. I want to say tens of thousands, hundreds of thousands. It was good. Tech Crunch drove, don’t get me wrong. That article drove a lot of traffic to our site too.
Andrew: One thing that I noticed going back to ARKive.org is even though the movie poster images, many of them are no longer working, the one thing that is very clearly working is a checkbox that said, ‘Tweet that you’re using this site.’ You thought viral right away.
Kurt: There’s an interesting story behind that. We had this roadblock when you first came [??] the site, and it was like, ‘Connect to Twitter.’ Then there was a little checkbox that said, ‘Also tweet that you’re using us.’ The funny story, this might even go back to the days of trying crazy stuff, is when you came to the site, that was checked for you. If you weren’t paying close attention [??] what was going on and you connected through Twitter, we’d tweet [??], ‘I just signed up for Flick. Come check it out.’ We had that on and we launched.
Everyone’s coming from Tech Crunch, and you see the Twitter stream. We’re watching the Twitter stream. Tons of tweets about Flick are going on. Then there was a little bit of backlash from the community, ‘I didn’t realize you were going to tweet.’ An hour after the Tech Crunch article hit we ended up turning that off. That made people a little happier, but those strategies of virality when people are signing up, that definitely helped generate some buzz too.
Andrew: What kind of thought process goes into creating the shadow accounts for people? The one where it’s just following what they’re doing online and create an account that’s ready and waiting for them to activate and then fully enjoy without having to do the work to populate it with movie reviews. That’s brilliant. How do you get to that?
Kurt: That was one of my favorite things. To be honest, it all started because of the way I did the hackey [SP], prototype at the beginning. I was getting public tweets. One of the things, when I was doing that I would store them in a database, and if I wanted to look up my own name or a famous person’s name, I think the famous influence or person is how that idea came to be. I just want to type in, for example, [??] Rose. He has a million followers on Twitter. I want to type in his name and see what he said, not only because he says stuff all the time on Twitter, I just want to see what he says, and then see what the people he’s following are saying.
I think that’s how it happened is looking for famous people and seeing what they’re saying. I want to see, I can’t even think of a celebrity off the top of my head, but any celebrity, you type in their Twitter name and see what they said about different movies.
Andrew: Like Roger Ebert. It’d be interesting to see not what he formally said in the paper, but what is he tweeting about? Is he enthused about this movie?
Kurt: Movie critics, but off the wall random celebrities, like Kim Kardashian for all the people that love the Kardashian show. You can see what she’s saying about movies. For me, that was cool because a site like Rotten Tomatoes where you have to go there, you have to create an account. You have to find other people that are on the site and friend them. All that stuff is out the window. The friend network and what you’re saying about movies, it’s already out there. Go to the source and build a site around it.
Andrew: You said the movie industry contacted you. How useful was it? Were they pumping you for information and trying to figure out if something could happen someday?
Kurt: It was really interesting. Most of it was the marketing teams, and so Twitter evolutioned at that time. They were starting to really blow up and I think the movie industry all knew that Twitter was something that would really either drive ticket sales or affect what people thought about, if they should see a movie or not when a trailer comes out. And so the movie industry as a whole was understanding Twitter more and more and then when they saw something like Flick, they were kind of like, oh, I think it was more like, what is this Twitter thing? What is this Flick thing? What are they going to do? We don’t want to miss the boat. So it was really useful actually. There was a lot of good talk about either, like I mentioned before, either one is helping them gather data about their trailers and their releases or also doing custom campaigns on the site itself to promote movies.
Andrew: All right. I get that, right? You’re putting all these trailers out there and you don’t know how they’re going over in the real world with the real public.
Kurt: Yeah. One little tidbit I learned from that whole situation is, what they’ll end up doing is they’ll put out a really short trailer and they’ll gauge the feedback. I’m sure now they use Twitter to do it. And if the trailer isn’t looking good they’ll basically re-cut it with all the good scenes. So they’ll keep making new trailers with more and more good scenes until the trailer [??] …
Andrew: I see.
Kurt: … really well.
Andrew: So my guess is then that, if a trailer gives away the whole movie it means all the other trailers, all the other efforts failed.
Kurt: A trailer for a movie that you didn’t think was going to be that great and there’s all sorts of epic scenes in the trailer [??].
Andrew: And you must have felt too great that you created this project and now Hollywood is actually interested. They’re listening. They’re inviting you into their world.
Kurt: Yeah. It’s crazy. I remember talking to the guys, because we went down to L.A. for a week and we met with all the studios, and I remember telling the guys at that point, we launched this site because we launched it and we actually went down to the studios the next week, so it was a week later. I remember, you turn on a product and a week later you have meetings with all these guys in the major studios marketing department. It just shows the power of social media, consumer internet, all that stuff. Yeah, it’s wild.
Andrew: Now we know that not only does that not happen to companies today but it didn’t happen to companies even back then. They would post on [??] and get all this attention and get acquisition offers and so on. Why do you think this happened to you?
Kurt: I actually think, you’ll hear a lot of people say this, there’s a lot of luck and a lot of timing involved with starting a business. I really do think we were the right team and the right time at the right place. Late 2009, early 2010, Twitter was blowing up. There was all this data. There was a lot of people saying there’s gold in the data, people trying to do things like predict the stock market with the data. So we had that going for us. And too, I think, it’s still true today is, a lot of these older businesses, like the music industry, the movie industry, they’re still trying to figure out how to use technology to their advantage, and when something like Flick comes out and it’s a nice merger between the old style, showing a trailer, showing a movie poster, all that stuff, and the new style, showing what people are saying real time, it generates a lot of good buzz and so I think it was a lot about being in the right place at the right time.
Andrew: And it was a full team. If anyone wants to acquire a company and having four people, who are all great, who all work well together, is so much more valuable than acquiring one guy with a good idea and a product.
Kurt: Yeah. And so from a tech perspective of like a tech company acquiring Flick, that was definitely something very, very attractive as you get the guys that are really good at their own thing, a solid team, a complete team, all that stuff.
Andrew: And social media, it was just starting to be interesting to the rest of the world, and you showed what could be done with it. This is ready for you if you can analyze what exists in front of you.
Kurt: Yeah. And, I mean, I still tell people even today, this concept, I still think someone is going to do it even better than we did it, like on a large scale, and as a user of whatever service comes out, you’re going to be like, wow, this is really good.
Andrew: Yeah. I could see that happening to my data to see which phone is doing better than building for that platform to see what, I can’t think of, I guess TV shows are a little late …
Andrew: Which start-up is getting the most interest, the most conversation and then invest in that company.
Kurt: That’s right. And I think Twitter, even themselves, they’re doing a little bit of it now, they have this discover tab you can click on on their site and it shows the top stories and all these things so …
Andrew: Did Twitter talk to you about an acquisition back then?
Kurt: We didn’t talk to them directly about an acquisition. We were talking to them about a whole bunch of stuff. They were really into the service, so we showed them an early preview. They loved it. They thought it was really cool. They promoted us. Back then on their sidebar they would promote different services. They promoted us. They were very helpful, very cool. They loved what we were doing.
Andrew: You still have to keep building the site. You still have to keep improving the product without getting distracted by all these great opportunities that are put in front of you. You told April that one of the issues you had was refining the technology. Things are going great on the outside world, but you know how much further you have to go. What are some of the issues that you are battling while we were all praising?
Kurt: One of the big problems was detecting if a tweet was actually about a movie, and then determining if the tweet was positive or negative. One of the examples I talk about all the time was there was this movie called “Paris.” Whenever you saw a tweet with the word Paris in it, how did you know if it was about the movie, or not about the movie? It’s a challenging problem. We had built a bunch of internal tools where we could take a bunch of tweets about Paris, we could run them through our algorithm and see what came out, and then if we saw tweets that didn’t look like they were about the movie, we could hand label them and re-train as a system or a model for those of you that know about machine learning, it’s re-do the process over and over and refine our algorithm.
That was the main thing we were doing behind the scenes, which was pretty engineery. We were constantly working on that. Constantly looking for examples where our technology didn’t work. For us, we viewed that as, it would be a big benefit down the line if this [??] was really refined when we wanted to apply it to other products, other verticals, like I mentioned before.
Andrew: Was it helpful or distracting to try to solve a problem that applied to the movie industry but in the back of your mind say, ‘How would this also apply to stocks or television and those verticals?’
Kurt: That part of it was helpful. I don’t think it was distracting at all. One of the main things for us that was a little hard to think about all the time was we were Twitter only, and one of the things we were always talking about doing was to do it on Facebook data as well. That was always a headache to think of just because of how it would change the layout of our site, the UI. That was distracting, but thinking about applying it to other verticals was very helpful. From an engineering perspective we are always trying to keep in our mind, ‘We want to generalize this. We want to be able to take it to another level, platform.’
Andrew: What’s a mistake that you made? We’re talking about so many good things that I feel the audience is going to think, ‘This guy just lucked onto something. Congratulations to them, but what am I going to do with all this?’ What’s a mistake that you made?
Kurt: One of them, when you’re starting a side project into a company, if you’re going to incorporate, we talked about this earlier. One of the first things we did was incorporate. Definitely incorporate after you’ve left your current job. One of the things is we all hadn’t left Digg and we incorporated, and that can lead to a little bit of tension if someone’s looking to work with you or acquire you, and it looks like some of the tech may have been invented while you were working at another spot. That’s one lesson learned. Incorporate when you’re not working at another company. What other mistakes? That was the big one. The big lesson learned.
Andrew: How about one piece of advice that you’d give the younger you, as you were walking into Digg for the first time with the vision now of what’s possible.
Kurt: For me, the younger Kurt. One thing I took away is I was very lucky, successful, whatever you want to call it with this particular Flick startup, but a lot of it goes back to working at Digg, so telling the younger Kurt, ‘You don’t have to be a founder. If you’re an early employee at something that might potentially be epic, it’s like being a founder. You get a lot of those same experiences. You learn a ton from the people around you, and you get to be immersed in all sort of aspects of the business as an early employee. I would tell the younger Kurt, working at Digg or any kind of early startup is healthy, and it’s like being a founder.
Andrew: With one exception. I had Owen on here who was one of the early developers at Digg. He was [??], and you’re saying that the early guys didn’t get to profit the way that Kevin Rose and the real founders and real leadership of the company got.
Kurt: Yeah, so I don’t know all the financial details but for me personally I think of my time at Digg it’s like, it’s not maybe short term profitability through direct money. But I profited, I learned so much, made such good connections. I wouldn’t have been able to meet the guys I met and start a company like Fflick. So for me I view everything that’s happened since I’ve done Digg as profit from Digg. I know Owen’s done a lot of cool things since he’s left too. There’s a ton of Digg guy’s who have started companies or wanted to do great things and a lot of us, it comes from Digg.
Andrew: I feel like that’s something that Robert Green, the author of 48 Laws of Power and Mastery, he told me that in that period where you’re learning, forget about money. Just do what you need to get by but what you’re looking for is not money to get by but then knowledge to then go and do what you did really. To figure out, well how do I get into Tech Crunch, how do I interest investors or think about my business or come up with innovative ideas. It seems like you’re a really good example of what he says to do.
Kurt: Yeah, I mean I totally agree with that.
Andrew: I’m trying to think if there’s anything else along the way. Well, here’s what I was wondering. So the day of the sale, roughly around the date, Tech Crunch wrote the article that I told you about. And in the headline they said you guys were acquired for 10 million dollars. Did they get that number right?
Kurt: It’s funny. So one of the funny stories behind that article is the Fflick PR team didn’t come up with that headline, so I don’t know where that number came from. And, I don’t know, there’s so many ways you can look at sort of the price of an acquisition. I can’t really comment on the specific number for it. I’m not rolling around in, personally I’m not rolling around in money. Still working at Google, all that sort of stuff.
Andrew: Did you get a million dollars from the deal, cash? Or more?
Kurt: Did I get one million?
Andrew: A million or more?
Kurt: Oh, in cash. No, so, I profited. I made a good amount of money but I don’t really want to talk about specifics.
Andrew: Okay, but you’re not going to say more than a million?
Kurt: No, I’d rather just not talk about the money part of it.
Andrew: Not say anything at all. What about capital gains taxes. Considering the fact that you owned the company for less than a year. Were you hit with a lot of taxes?
Kurt: Yeah, so we were hit with a lot of taxes, but I guess that’s part of the game. I’m not complaining.
Andrew: Was it an aqui-hire situation where Google acquired you guys because you were incredibly smart, you were a team that was good together, and then they shut down the site.
Kurt: Yeah, so I think a couple of things is. I mean, I kind of consider it an aqui-hire. We’re an awesome team. To be honest we came here to work on something very similar to Fflick, and we’re still sort of working on that. And so hopefully some day you’ll see what we’ve been working on.
Andrew: When do we see it? Your site after the sale said, we were acquired by Google to use the technology that we’ve just built, stay tuned. I’m staying tuned. When do I get to see it?
Kurt: Yeah, hopefully it will be coming soon. There’s a lot, like we’ve been involved in a lot of cool stuff here. So aqui-hire or not we’re definitely using some of the tack and doing something pretty similar inside of You Tube.
Andrew: And have you started to deploy it yet?
Kurt: So it’s kind of funny, like, it’s definitely like, internally we’ve been playing with stuff since we got here. But externally, yeah, no one’s really seen what we’re working on yet.
Andrew: How does that feel, to go from being able to launch something and now people yell at you or rave about it on Dig, to launch your own company and have people (?). And now I can’t even see it, you can’t show it to your Mom, they’re e-mailing you to say how cool it was.
Kurt: Yeah, that’s one of the downsides of working at a bigger company, but. It’s kind of cool like I mean the main benefit obviously of working at Google is the number of users. So when we finally do show it it’s kind of cool to know like everyone in the world is looking at what you’re working on.
Andrew: And this is on You Tube where we’re going to see it.
Kurt: Yeah, we’re all at You Tube right now, yeah, we’re working on some cool stuff.
Andrew: Okay. And just so I understand this. You’re not saying no to the 10 million but it’s different ways that you can get paid and basically we’re talking about over time if you guys stay there then there’s a big payoff. We’re not saying whether it’s 10 million or not.
Kurt: Yeah, so definitely like how the acquisitions usually pay out versus a small team like this is you don’t get paid a big check on day one and then you can do whatever you want. You’re definitely like, you’re sitting at the company. You’re going to put in some time working there. You’re going to work hard and earn whatever they give you.
Andrew: And make sure you don’t just eject as soon as you get in.
Kurt: That’s right.
Andrew: All right. Is there anything that I missed here? Anything that an audience of entrepreneurs who are your friends, who are new to technology and new to entrepreneurship should know?
Kurt: I don’t know. The main thing that I tell everyone is that you’re never going to become successful unless you take your idea and you actually turn it on and you do it. I think that was one of the big takeaways from us, and one of the key things I try to tell everyone I meet with, start something on the side. Play around with ideas, but definitely, if you ever want to be successful and do something, you’re going to have to jump ship and dive in with both feet.
Andrew: That’s what you guys did?
Andrew: Before we go, I want to ask you a couple of things on a personal note. You’re investing in side companies, in other companies. What kind of companies are you investing in?
Andrew: I do small, very, very small stuff with people I know, who are friends. The one that I really like right now is my friend John Braylig(?), who is doing a company called Info Scout. It’s an iOS app. If you open up the App Store and you search for Shopperoo, there’s a pretty cool app that lets you take pictures of your receipts and then it donates money to charities. All you have to do is take a picture of a receipt and they donate money to your favorite charity, which is really cool. It’s a start- up that my buddy is working on, so check that out.
I put a little tiny bit of money into Kevin Rose’s latest gig, and he ended up where I am. He’s like Google now.
Andrew: Into Milk?
Kurt: Yes, that’s right, into Milk.
Kurt: So normally what I do, if my friends or people I know …
Andrew: Did you profit from that Milk deal?
Kurt: To be honest, they flipped it pretty quick. It was sort of like a (?). I earned tiny tiny tiny amounts.
Andrew: All right. I think that’s everything. There’s so much actually. I wanted to ask you about your book collection. I wanted to ask you about how you fricken run in the city because I’m exhausted every time I run into work. How do you run in the city? Let’s end it on that.
Kurt: Well, you’ve got to move up north. You’ve got to be where I am in the Marina.
Andrew: That’s the answer. I’m probably in a very hilly part of town, aren’t I?
Kurt: That’s right. Crissy Field. You’ve got to go all the way up north along the Bay. The only down side is, it’s not hilly but it can get windy. That’s the spot to run.
Andrew: I felt that on the Embarcardero last night. I was riding a bike over to a friend’s house, and the more north and then east that I went, the harder the winds kept hitting me. But I can deal with that.
Kurt: That’s another good spot to run, the Embarcardero.
Andrew: Congratulations on the success here, and thanks for sharing with everyone. I’m going to tell everyone that if they want to connect with you, the best way to do it is Twitter. Kurt Wilms is the Twitter name: @ K-U-R-T-W-I-L-M-S. I hope you guys find a way to connect with him, whether it’s on Twitter or email or in person, find a way to just connect with him. Kurt, I’ve gotten to know you now for just a short amount of time. I’m so glad I did. You’re a great guy, and I appreciate all the work that you put into doing this interview, including driving down and finding your way down to Google’s offices so we could record this interview.
Kurt: Yeah, thanks for having me. It was fun.
Andrew: Thank you all for being a part of it. Bye guys.
Kurt: Good night.