Introducing Leap Forward

If you like exploring how great companies are actually built, I recommend checking out the Leap Forward podcast. Hosted by entrepreneur David Rusenko, it is a great show for our listeners who want to hear the founders of AirBnb, Reddit, Twitch and others together with the people who knew them before their success.

• 0:00Speaker 00

  As listeners of the Jordan Harbinger Show, you know that behind every successful leader is often a messy human story. That's what makes Leap Forward a podcast worth checking out. It's hosted by entrepreneur and investor David Rusenko. And the unique thing about each Leap Forward episode is that David talks with his guests alongside people who knew them before their success. There's been a college roommate, a first employee, even an episode with a parent. I specifically want to recommend the Leap Forward episode where Airbnb's Nathan Blacharzik talks about 80% of their business evaporating in a global pandemic. We hosted Nathan's co-founder, Brian Chesky, here on the show back in September 2021, which some of you might remember. I'm going to play you a few minutes from another Leap Forward episode featuring Twitch co-founders Michael Seibel and Justin Ken.

• 0:42Speaker 00

  Live streaming might feel inevitable today, but Twitch originally began as a 24-hour streaming experiment called Justin.TV, which, by the way, this show, my show, was on a million years ago. And in the early days, just surviving through the explosive growth was quite a roller coaster, as you'll hear in this episode preview.

• 0:59Speaker 01

  The platform grew pretty quickly until, at one point, it didn't. And you guys had another moment of having to figure things out.

• 1:05Speaker 02

  So the platform opens up. I think 2008 and 2009, we're just growing. So you snap your fingers, you wake up. You know, we now have 20-something employees. We now have 30 million people coming to the website every month from all over the world. It became a thing, and the focus shifted. So it was less about life casting, and it was more about anything that people wanted to stream. So we had people streaming pets. We had people streaming video games. We had people streaming The Simpsons. It was a free-for-all, and we were getting sued, and it was just crazy. But we were running low on money.

• 1:48Speaker 02

  And late summer 2010, we have maybe two months of money in the bank. And at this time, we are spending about $1 million a month to keep the company going, and we're making about $750,000 a month. And we have about $0.5 million in the bank. I mean, there are many times that Justin TV almost died, but this was kind of a big boy. And I remember, we were transparent with all these numbers. So all of our employees knew, everyone knew. And I asked the founders and a number of the important employees to come into this very shitty conference room. We had like a closet, basically. And was like, here's the deal. We can shut this company down.

• 2:34Speaker 02

  We can figure out how to get our burn to $100,000 a month, which would give us five months. We can figure out how to get to break even, or we can get profitable and never have to fundraise again. And I was like, what do y'all want to do? And I had no idea what people were going to say. And everyone says, let's get this thing profitable, fuck VCs. And I was like, okay. We need to stop every current project that we're working on. And there was a whiteboard in the room. It was like, on one side of the whiteboard, I'm going to write everything that we can do to save money. On the other side, I'm going to write everything we can do to make money. And we're not leaving this room until both sides of the whiteboard are completely covered.

• 3:17Speaker 02

  And we just started throwing out ideas. We had a lot. Pre-roll video ads. We rolled out international subscriptions. So like, if you're in markets, we couldn't monetize with advertising. We were charging you $10 a month. We figured out how to reduce our streaming costs, our storage costs. And in two months, the company was break even. And by the end of 2010, we had generated about 1.2 million in profit. And I never would believe it. I never would have believed it. I was there, I wasn't believing it.

• 3:52Speaker 01

  And so from that point, right, you have this kind of near-death moment. You know, fast forward a little bit. I mean, what that became from that point was SocialCam, Twitch. You know, if you think about it, you know, that little moment in a North Beach apartment turns into live streaming, right? Which is something you take for granted now, is like a very ubiquitous thing. But it didn't exist back then. I mean, do you, like, what's your... Do you ever think back to that?

• 4:17Speaker 02

  Isn't that weird? We were kind of the first ones to popularize something that is now ubiquitous and taken for granted. Yeah, it's weird.

• 4:27Speaker 01

  And you didn't even want to do it originally.

• 4:29Speaker 02

  I didn't know. This is the life of a startup, right? It only sounds like a good plan afterwards. But I would say that, like, for whatever reason, we had a good team, and we didn't want to die. And I just feel like, in every situation, we tried to figure out how to not die, and we had really, really good people to rely on. And it just turns out, you run that cycle enough times, and you get lucky enough times, and you do something cool. And I don't know that if you unpack most successful startups, there isn't a strain of that. As opposed to, we had the plan from the beginning, we executed it according to plan, and we won and dominated. Like, I've never heard a startup story like that.

• 5:11Speaker 02

  So no, no, that was just our great team, a little bit of luck.

• 5:16Speaker 00

  That was from the episode entitled "The Strange Origins of Live Streaming." Find conversations like this and more on Leap Forward, available wherever you get your podcasts, and tell them Jordan Harbinger sent you.