‘I WAS OUT OF MONEY AND SO I ENDED UP SLEEPING ON FRIEND’S COUCHES’
But the group was faced with a tough and less-talked-about decision some MBAs have to grapple with. It’s common knowledge MBAs from Stanford make a ton of money, more than graduating MBAs from any other business school in the world (see What MBAs Make In Their First Year Of Work). The decision to forgo traditional internships and full-time job offers is also a decision to forgo a certain lifestyle. The decision? “At the end of that class (Launchpad), we decided to reject the offers and work on something together,” Seghete says.
For Molinet, the decision was particularly tough. “I didn’t have any money, so it was an especially tough decision,” he recalls. “I had started interviewing at consulting firms very early on because I hadn’t started interacting with Mada or Alex yet and the potential idea. And offers started coming in. Like $10,000 a month. Summer hit and I was out of money and so I ended up sleeping on friend’s couches for the 12 weeks during the summer because that was the only way I could pursue starting a company while also being out of money.”
STARTUP ATTEMPT NUMBER TWO: A PHOTO BOOK (MAINLY FOR MOTHERS)
Committed to a new project — and each other — the team locked themselves in a room for eight hours before the summer to brainstorm ideas. The result was Kindred Prints, an app that took photos from smartphone camera rolls and printed photos into books. The team spent all summer building the app for launch in October of 2013 shortly after the beginning of their second year at Stanford.
“We had some really good traction early on,” Molinet boasts. “We were featured by the App Store. We were featured by Google Play. We got a Techcrunch article written about us. It was insane growth in the first few weeks. Like, insane. We were not sleeping.”
They sold more than 10,000 books and were reaping the benefits of the upcoming holiday season. But then the holidays passed and sales slowed. Winter turned to spring and the team was faced with an upcoming graduation and looming employment decision. This time it was Seghete balancing an attractive offer from Apple. “It was a great position and a great company and I would have made a lot of money instead of no money,” she says. “It was a tough decision.”
Seghete turned it down. Two weeks before graduating, Austin and Seghete were chatting on a Sunday afternoon. They were reflecting on the upcoming graduation and Kindred Prints. They were wondering if they wanted to spend the next five to 10 years building a photo book company.
“Is this ever going to be a multi-billion dollar business?” Molinet recalls asking himself. “And the short answer was no. And I don’t think we were excited about building a photo book business. That wasn’t what we felt was going to be impactful for the world.”
STARTUP ATTEMPT NUMBER THREE: SOFTWARE ‘MAGIC’
Once again — a year later — the team was brainstorming potential startup ideas. And they realized the solution to one of the headaches they experienced with Kindred could be the idea they had been looking for.
“What we found was on mobile, it’s a very fragmented market in terms of technology,” Molinet explains. “You have these two large players — Apple and Google — that have apps behind their own app stores. You have web-based URLs, which are different from the way apps handle links and routing. They all handle end-user routing and clicking and app opening very differently.”
If the team could find a way to link all of the internal moving pieces of an app, they could solve not only the problem they had themselves, but the problem they assumed hundreds or thousands of app developers experienced. That’s when the team experienced what Seghete had dubbed “magic.”
“We experienced this thing that I call magic, which is product market fit,” Seghete explains. While working on the previous two ventures, Seghete spent time at dog parks and public places interviewing dog owners for the first venture and mothers, who were the primary consumers of their photo books. “One in five or maybe one in seven people would say, yes I would buy that,” Seghete recalls of the dog collars and photo book apps. When Seghete reached out to her contacts at tech companies like Zynga and Gogobot, she heard a different response. “Every single person we talked to said they needed this,” she says, lighting up. “They couldn’t build it themselves but they said it was something they needed. Everyone said yes.”
‘WE’VE ACHIEVED IN TWO-AND-A-HALF YEARS WHAT IT TAKES MANY COMPANIES FIVE, SIX, PLUS YEARS TO DO’
So in June of 2014, the foursome started hacking and building with the help of a $300K angel investment from Palo Alto-based Pear Ventures. By September of 2014, the team not only developed a product, but had 30 app developers using its “deep linking” software and a $2.75 million seed round that included investments from long-time seed investor and entrepreneur Ben Narasin and New Enterprise Associates in addition to Pear Ventures. They also had 30 more developers at the helm. After a year, they had 500 more developers using their software for such apps as iHeartRadio, Coffee Meets Bagel, and Instacart. Not to mention, another funding round, this time a $15 million Series A round that included nine investors. And in 2016, the team jumped from 40 employees to 90 and gained a $35 million series B round. They’ve also added some heavy hitting partners that include Starbucks, Pinterest, Airbnb, and Target, among thousands more.
“We’ve achieved in two-and-a-half years what it takes many companies five, six, plus years to do,” Molinet says. “In a matter of 15 months, we raised our seed, series A, and series B. The market adoption continues to be very, very strong.”
Seghete says the company has started generating profits and revenues in the past year. “Every stage has pushed us in different ways as entrepreneurs,” she says. “I was the marketing department,” Seghete says of the first months when just the four of them were working on the product. “We had to learn how to grow as individual contributors because everything we do has extended, but also as managers and founders keeping a culture and space from three or four people to 90 people.”
FINDING THE ‘PAINKILLERS’ OVER THE ‘VITAMINS’
As for current and future B-school entrepreneurs, Seghete and Molinet have some sobering advice. “If you really, really want to do it, commit 100% to it and don’t get distracted by events, by fun activities, other people getting internships and full-time offers that seem lucrative,” Molinet says. “Because if you really, really want to do it, none of that matters because you should be so committed to the business and building something in general, that you shouldn’t give a shit about that other stuff.”
Molinet and Seghete agree one of the biggest difficulties of launching a successful business while in an MBA program is to ignore all of the distractions. “You can’t have it all,” Seghete maintains. “Everyone we’ve seen in our class that tries (to have it all), failed. A lot of them were successful after business school.”
And finding those rare teammates that share the same level of commitment is also an often over-looked factor. “I think a lot of people miss it,” Molinet says. “They look for skill sets or people they like to work with on a class project. And that’s really important. But dedication and commitment to doing something even through the ups and downs is also really important.” Even if you have a great skill set and “If one person is all in and they don’t care what they have to do — even sleep on couches — and the other one is like, it’s fun, I wanted to play entrepreneur for a little bit. I wanted to theorize and test it out, but I’m going to go get a full-time job at Google after this, that misalignment makes it really hard for a team to click.”
For Seghete, a successful venture is like a “painkiller.” “Just keep building,” she advises. “Make sure you don’t get too enamored to one idea. And don’t come up with ideas in a vacuum. There is this concept of painkillers and vitamins. Our first two ideas were vitamins, versus Branch, which is a painkiller. It was a need we faced. A lot of business school teams sit in a room — and we were no different — and come up with vitamin ideas.”
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