The Billion Dollar Startup: Bringing People Together to Change the World

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Many entrepreneurs who plan to enter the market with a new, unique product think about how to succeed and make good money.

It is obvious that there is no universal formula for effective promotion of startups. In an attempt to clarify something for themselves and understand where to go, aspiring businessmen study the lives and business strategies of those who have already conquered the world with breakthrough startups.

In this selection, we will try, based on the biographies of two successful entrepreneurs, to make a conventional portrait of a startup who knows what and how he does it.

Eric Lefkowski is a man who sells even unprofitable companies

  • Big startups – Groupon, Tempus.
  • Commercial interests in the field of advertising media market and breakthrough biotechnologies related to big data and medicine.
  • The amount of wealth for October 2021 is 4.1 billion dollars.

Eric Lefkowski

Photo: peoples.ru

The name of the American businessman and investor Eric Lefkowski is primarily associated with the Groupon brand – an innovative platform that unites people for the purpose of purchasing goods at a discount.

However, it should be clearly understood that the success of the co-founder of this startup is not accidental. The fact is that Lefkovsky has been engaged in various projects since he was a student, gaining the necessary experience in business.

Eric was born into a typical American family. His parents clearly lacked stars from the sky: his father worked as an engineering designer, his mother taught at a school. Lefkovsky himself also did not stand out in anything special either at school or at the university, except that he showed special diligence in his studies, which allowed him to receive a doctorate after graduating from the law faculty of the University of Michigan.

But Eric probably did not think about a career as a lawyer. Already during his university years, he created his first company, Apex Industries, which was engaged in carpet trading. Later, having borrowed money from relatives, he and a friend bought the company Brandon Apparell, which was engaged in the production of sportswear.

Despite the rapid increase in revenue (from 2 million to 20 million dollars in a couple of years), the company eventually went bankrupt. Which surely allowed Lefkowsky to learn some lessons: later, under Eric, the reputation of a person capable of selling loss-making enterprises for big money was strengthened.

Lefkovskyi

Photo: pinterest.ru

This skill was revealed in the case of Lefkovsky’s first Internet company – Starbelly, which dealt with issues of promotion and advertising. Eric was responsible for PR at Starbelly, managing to attract the attention of investors from large American funds. Moreover, shortly before the famous collapse of the dotcom market (when the index of high-tech companies traded on the Nasdaq exchange fell more than five times in a year) in the early zeroes, Lefkovsky sold Starbelly, and this at a loss of $ 2.5 million with a revenue of 183 thousand dollars.

Lefkovski’s next commercial projects were related to logistics: together with a university friend, he created and developed several companies. But he was already showing a real interest in the media advertising market, where he went, creating the MediaBank company. After attracting investments and buying a number of IT products, MediaBank turned into a large cross-platform service that releases advertising software to the market.

At the same time, Lefkovsky became interested in another product launched on the basis of a failed startup of socio-political coordination of people – The Point. Conceptually, the idea of ​​The Point belonged to the eccentric programmer-developer Andrew Mason. Launched not without the financial participation of Eric Lefkowski, The Point quickly turned into a service for collective collection of money for various events.

Lefkovskii directly realized the prospect of directing a collective gathering for a common goal. Thanks to him, the improved The Point later turned into Groupon, a platform that provides good discount offers when a certain number of participants interested in this offer is reached. Later, the Groupon service slightly changed its format, turning into a large discount aggregator.

The subsequent success of Groupon (not only in America, but also around the world) was facilitated by the chosen service model, which hundreds of startups tried to clone. However, Lefkovsky successfully rebuilt from all competitors, which eventually allowed him to go on a grand IPO in 2011: Groupon was valued at $12.8 billion and was able to attract $700 million in investment.

Groupon's success story

Photo: terasacademy.com

Groupon’s success story allowed Lefkowsky to make a big name for himself, although it’s not the only startup he’s been involved with. Eric’s business case includes five companies worth at least $250 million, and his latest project, Tempus, which develops effective cancer treatment models based on big data, is valued at several billion dollars.

In the business environment, Eric Lefkowski became famous as a rather tough person who knows exactly where he should go in business. And it doesn’t matter that this movement slows down at some point, leads to the collapse or commercial degradation of another enterprise (after all, nothing lasts forever). The main thing is that you have the strength and resources to move on – this is what the entrepreneur thinks.

According to Lefkovsky, the formula for success is to see another potentially successful project in time, which is better to invest in immediately: the more you invest in a startup at the start, the faster you will have a good return. And at the first signs of a possible future decline, the company can always be sold, and often at a very good price.

Never hang your nose and keep looking for good investment ideas – this is what Eric Lefkowski, a person who may yet surprise the world, teaches all his life.

Quotes from an interview that characterize Eric Lefkowski’s style:

– Business studies should not be separated from life – you should always look at all sides and see what can really help only you. Perhaps it is some kind of social experience, communication with friends, relatives or partners. The main thing is to always see and understand what communication with this or that person can give you.


– I participated in the creation of three large companies that achieved great success. It’s not that much, but believe me, it’s actually a lot!


– Somehow there comes a moment in business when you need to focus and double your bets. Be careful, don’t miss this moment.

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Stuart Butterfield: the dharma of the lucky business man

  • Big startups – Flickr, Slack.
  • Commercial interests in game development and innovative communications.
  • The size of the fortune for the summer of 2022 is 1.3 billion dollars.

Stewart Butterfield

Photo: heceomagazine.com

It is hard to believe that American hippies, born in a family living in a hut in one of the provincial Canadian towns, Stuart Butterfield will sooner or later become a billionaire, the founder of one of the most popular corporate messengers in the world, Slack.

From childhood, David was distinguished by great independence: at the age of 12, for example, he himself turned to social services in order to change the birth name of Dharma to the more sweet-sounding name of Stewart to the Western ear.

The word “dharma” in Indian philosophy denotes a certain set of morals and principles that support a person in life. It is possible that hippie parents, having given such a name to their son, karmically determined his fate – because people who live according to certain moral foundations often achieve success. By the way, Stuart himself became interested in philosophy, already at a conscious age he entered the college’s philosophy department. Moreover, already at the age of 25, he received a master’s degree in philosophy from the University of Cambridge – Butterfield’s specialization was the philosophical rethinking of biology, consciousness and scientific cognitivism in general (cognitivism is a scientific direction at the intersection of cognitive theory, psychology and neurophysiology).

Stuart Butterfield got into business quite early: as a boy, he sold hot dogs bought at a cafe with a markup on the beach. Even then, he actively studied programming and wrote simple computer games. After graduating from college, Stewart moved to San Francisco, where he began his first serious business, joining the startup Gradfinder.com (a college alumni networking service), which was founded by his friend Jason Classon. It would seem that the time for the development of a new Internet project was poorly chosen, since the so-called “dotcom bubble” had just burst in America. But the friends were able to sell Gradfinder.com at, as Butterfield later put it, “a healthy profit.”

Later, Stuart is engaged in web design for a while, but he does not forget about programming and computer games, returning to the market with the idea of ​​a multiplayer game Game Neverending.

Despite the popularity of the game, it did not bring income, and two years later, the company Ludicorp, founded by Butterfield on equal terms with his wife, Catherine Fake, and the same tireless friend Jason Classon, was on the verge of bankruptcy.

Stewart Butterfield Game Neverending

Photo: roem.ru

An idea that came to Stewart’s mind quite by accident saved young startups from ruin. He mentioned that Game Neverending had a special shoebox in which the photos were stored. Players could drag and drop these photos into a group chat where other users would comment on the photo. Actually, on the basis of this idea, Flickr was conceptually born – a photo sharing service on the Internet.

Flickr differed from its main competitors, namely Shutterfly and Snapfish, by allowing users to tag each other in photos and leave comments. Flickr quickly became popular, especially loved by bloggers for the ability to quickly upload photos, and in 2005 Butterfield sold the startup to Yahoo! for 25 million dollars.

Interestingly, the next breakthrough startup is related to another game of his that never took off. In a very strange “geek” quest Glitch, the idea of ​​chats for grouping by interests was implemented. It was this idea that conceptually formed the basis of Slack’s internal user communication platform.

Technically, Slack was prepared for the release for a whole year and after a wide PR campaign in the press with the announcement of limited access through a system of special invitations, the release took place. The success was amazing: more than 8,000 companies signed up for Slack in the first day, and this number doubled in two weeks. And a year later, Butterfield’s company attracted investments in the amount of 120 million dollars, becoming a “unicorn”, since the commercial valuation of the startup in the market exceeded 1 billion dollars (“unicorns” are called companies whose capitalization in a short time exceeds the billion threshold).

In 2015, the corporate messenger was valued at 2.8 billion dollars, and among the investors who invested a lot of money, the most famous people in Silicon Valley were considered.

In 2019, Slack went on IPO – the company’s capitalization was 23 billion dollars, and Stuart Butterfield himself became a billionaire, whose fortune was estimated at almost 2 billion dollars. In 2020, he sold the company to the largest US software developer Salesforce for $27.7 billion. Interestingly, Marc Benioff, the CEO of Salesforce, called this deal “a marriage made in heaven.”

After the sale of Slack, Stewart himself completely disappeared from the public space in order to, as he says, fully devote his life to his favorite work – the study of philosophy. Butterfield was remembered by his colleagues and business partners as a very cautious entrepreneur who is ready to take risks when the circumstances demand it.

Stuart Butterfield learned a lot during his time working on Slack. Talking about his path to success, he notes that a public company should not underestimate the power of social networks. In the promotion of the messenger, traditional media helped only 20%, the remaining 80% of brand recognition came from people sharing links to Slack on the Internet.

Founder of Slack

Photo: phys.org

According to Butterfield, when developing and bringing a startup to life, you need to pay attention to the unique features of the product, bringing them to near perfection. In his work, Stewart has always adhered to the principle of productive minimalism: only a few basic functional things can be brought to the ideal within the project, everything else is not so important.

Butterfield paid a lot of attention to corporate culture. He urged his team never to show even the slightest doubt and insecurity in front of people – people feel fear, nervousness, and this can negatively affect, for example, the results of negotiations.

At the same time, within the team itself, according to Butterfield, it is necessary to maintain the spirit of involvement in the great mission. Reminding employees of important things is especially useful in difficult, difficult times for the company. And not just reminding, but thanking for patience and work – this sometimes stimulates people even more than material benefits.

Quotes:

– It is necessary to sell the idea of ​​innovation, and not the product. So there are more chances to interest people. Innovation is the sum of changes to the entire system, not just a thing that causes changes in people’s behavior.


– If you can’t explain to another person what you do, so that later they go and explain it to someone else, then this is most likely a hopeless business.


– Life is too short to do something mediocre or create some bullshit.

What do billionaire startups have in common?

Any more or less famous startup has its own, special path to success. Everyone’s starting conditions are far from the same, interests in the commercial sphere are different, however, if you study the biographies and seriously analyze the behavior patterns and worldview of these people, you can identify some regularities.

There are also such regularities in the success stories of Eric Lefkowski and Stuart Butterfield. For example, both businessmen launched their first, trial projects in their youth, and they were not related to IT technologies. This shows that nature’s desire for entrepreneurship required an outlet in Eric and Stuart in the form of. But the boys, due to their youth and inexperience, did not yet know what they would be successful in, so they grabbed what they could.

It is also obvious that enterprising people have a particularly developed sense of business intuition. Both Lefkowski and Butterfield, apparently, always anticipated the process of decline, sunset of this or that business, being able to get out of the begging business in time and even profitably.

Getting out of business, however, is not a problem for an ordinary person. But to pick yourself up and come back again, to launch something new, potentially breakthrough – this is not given to everyone, in this Butterfield and Lefovsky are again similar.

But the main thing that unites these (and many other) startups is the belief that sooner or later their project will take off. Here the similarity is 100%, and life itself proves: everything is really so, only those who truly believe in their cause, fanatics in a good sense, achieve absolute success.

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