How Strava built a Global Fitness Community with 100M+ users | Expanding a consumer app to 196 Countries | Why Strava never intended to be a Venture Case | Hiring Young Potentials instead of Senior Staff (with Strava Co-Founder Mark Gainey)

00:00:00: Strava is probably the most prominent consumer sports app out there.

00:00:05: More than a hundred million users, life in one-hundred ninety five countries.

00:00:09: hundreds of millions of revenues.

00:00:11: If I can leave any message with your audience today if we could do it anybody can do It.

00:00:16: you have to be sort patient and really begin think about who are Your customers?

00:00:23: And Are You taking care?

00:00:25: We've had to go through layoffs at Strava in the past.

00:00:28: We have wrongful death lawsuits, we've had investigations by government over the course of years and unexpected things that led to tension.

00:00:37: The sooner you can get comfortable with the uncomfortable under right perspective there's nothing better.

00:00:42: Don't let your business define who you are.

00:00:48: Strava is probably most prominent consumer sports app out there, more than a hundred million users live in a hundred ninety five countries.

00:00:57: hundreds of millions of revenues.

00:01:00: But they started out targeting pro cyclists who are owning a Garmin by computer.

00:01:08: without this bike computer that costs three hundred dollars you couldn't use the first Strava version because it was a web one and then throughout years There was a shift to mobile, there were less friction because the GPS function in phones became better and they then could increase their user count.

00:01:29: And today I'm talking with Mark Ganey co-founder and in between.

00:01:34: CEO chairman since a month retired from Strava after more than sixteen years who goes into depth with us regarding the inception of Strava, where did it start?

00:01:47: Because the actual story started in nineteen ninety five not in two thousand nine.

00:01:53: and then we talk about the inflection points.

00:01:56: We talked about hiring first time talent and identifying potential and coaching.

00:02:04: these people were talking engagement metrics that Strava used to identify product market fit, but also to ensure growth because growth came through better engagement rates than they had and many more important steps in the Strava journey.

00:02:21: So thanks to LinkedIn co-founder Constantin Guilica for the introduction.

00:02:26: without you this podcast wouldn't be possible.

00:02:31: Thank you for listening to the Unicorn Bakery.

00:02:33: My name is Faben Tausch, and here are the tactical insights on building Strava from co-founder Mark Ganey.

00:03:00: Thinking together with Michael about Strava in a different name, a different setting way earlier.

00:03:08: In nineteen ninety-five.

00:03:10: take us back to that time.

00:03:11: and what happened?

00:03:13: Yeah yeah happy to you we've gotta go back boy till the last century.

00:03:17: I'm quickly becoming dinosaur here uh... yeah.

00:03:20: so nineteen ninety five fascinating period.

00:03:23: i was about five years out of college.

00:03:26: Michael was arguably one my best friends.

00:03:28: We had met on the crew team in college and had developed a great friendship there, and had this amazing experience on that team.

00:03:37: You know to be a college athlete competing at the highest level... particularly crew where it's such a team-oriented sport.. There is lot of hard work goes into it.

00:03:48: I often joke you should have graduated with degree in crew because thats were i spent all my time.

00:03:53: The problem was you graduate.

00:03:56: that experience disappeared in both of our lives.

00:03:59: And as hard we tried to replicate it by competing and other things, doing marathons and so forth after college... It just wasn't the same!

00:04:09: So, in nineteen ninety-five I'd been working here in California for basically an investment firm.

00:04:16: Michael had gone off got his PhD in economics who was actually a teacher at Stanford.

00:04:22: We began thinking about, in my case really I wanted to be an entrepreneur.

00:04:43: and the commercialization of the internet, in the first time companies are going online.

00:04:57: And so we had this idea that it was named after my dog, Kana.

00:05:02: It's called Kana Sports.

00:05:04: We were gonna create a virtual locker room on these new thing called The Internet where you're gonna invite all our friends to post their workouts... ...and find sponsors or big company to be our sponsor for this locker-room.

00:05:20: And we started going down the path.

00:05:22: We built a business plan and we start talking to website developers, you know there's good news bad news.

00:05:29: The bad news was that were way early.

00:05:32: That idea had a lot of challenges Both technically as well sort of business model wise.

00:05:37: But the good news is it actually led us To an amazing opportunity around.

00:05:43: I won't bore now but A very different business.

00:05:46: that became Kana Communications.

00:05:49: That was something that we then built for the next four to five years and ultimately took public, had a great entrepreneurial journey.

00:05:58: The Strava story started in nineteen ninety-five.

00:06:00: it got detoured or sort of put on the shelf for a few years but always at the back of our mind.

00:06:07: What's been time pick up again?

00:06:14: Now building what we wanted to build in nineteen ninety five because now is the timing and a time is right.

00:06:21: Yeah, yeah wish I could say it was just obvious.

00:06:24: i think you know.

00:06:25: with hindsight everything feels so clear.

00:06:27: an obvious.

00:06:28: but So what happened?

00:06:29: Was as I mentioned We ended up building conna very different businesses.

00:06:34: enterprise software company had this great experience doing that.

00:06:39: And then there was a period of time from the early two thousands to about two thousand six where Michael and I were on frankly, sort of different paths.

00:06:48: He continued in academia.

00:06:49: he was now teaching entrepreneurship in Dartmouth back on the east coast.

00:06:53: i Was here in california?

00:06:55: It was serving on lots of different boards and uh, I mean everything from public companies in south korea To you know healthcare startups and so forth and both of us felt like while that Is interesting it wasn't really satisfying our desires as entrepreneurs and operators and frankly we wanted to get back in the game.

00:07:17: And so Michael and I, we literally met in the middle of a country here United States.

00:07:20: we met in Colorado unveil summer.

00:07:22: two thousand six sat down for three days little condominium and we just started brainstorming again.

00:07:29: hey if you were gonna go start company what would be?

00:07:32: And we weren't thinking about that locker room at the time.

00:07:35: In fact, Candidly Fabian... We were spending a lot more time thinking about other companies that had been founded by other people.

00:07:41: and you know?

00:07:41: We wished we'd found it this one or that one.

00:07:43: and-and we started asking ourselves why!

00:07:45: You know what were the

00:07:46: qualities?!

00:07:47: And um..we found out that we're really interested in consumer for the first time.

00:07:51: so we tried to think okay what would be consumer

00:07:53: ideas??

00:07:54: Out of THAT trip & that time together , we came up with couple idea's.

00:08:00: One was the old Idea the virtual locker room.

00:08:03: and so he said well, maybe we could spend some time exploring that again.

00:08:07: We came up with some other stuff.

00:08:08: We were looking at I mean literally we're looking at things like filtered water delivery And yeah me I won't again.

00:08:16: lots of ideas sort of surfaced out of that.

00:08:18: first Sort of foray into entrepreneurship.

00:08:23: But over the course of the next twelve eighteen months The more than we explored what was becoming Strava?

00:08:29: The more we got excited about the fact that the world had changed.

00:08:32: To your point, there were some things that are very different.

00:08:35: one it was much easier to capture somebody's activity.

00:08:38: There were Garmin devices and various GPS devices That we're making it much easier too to seamlessly get an Activity.

00:08:47: And the other thing in hindsight that was changing although I don't think We really appreciate at a time.

00:08:51: but in hindsight what is really important Was just The advent of social media and the way in which people were sharing information online.

00:08:59: If you go back to nineteen ninety-five, far north than a hundred million registered users.

00:09:31: There was a time, I'm not sure how this today and if you can comment on it anymore but where you said that you were adding two million users monthly active in one hundred ninety five countries.

00:09:56: Yeah, compressed down like twelve years.

00:09:58: No let me I was in my head and seventeen eighteen years of history In an hour or one-and-a-half.

00:10:07: so we will only focus on a few breaking points that We can dive deeper into.

00:10:13: but when you would summarize it And that's probably the hardest question at all because You have so many things in your head in a second What would you say is the most critical and crucial denominator for success when you look at the Strava story in journey?

00:10:39: It's a great question.

00:10:40: One, I've not been asked before so i appreciate the challenge.

00:10:46: The first thing that pops into my head...I think that the team of Strava has done a good job over these fifteen or sixteen years retaining one really important thing we said all along from day one.

00:10:59: And that was if Strava remains fun and entertaining for its members, good things can happen.

00:11:07: Uh...and I think we still do that today.

00:11:12: We make all kinds of mistakes you know?

00:11:14: We've tried things in failed but so forth.

00:11:16: But i do.

00:11:17: at the end of this day is when you talk to our users.

00:11:24: It is a joyful part of their day.

00:11:47: And so our thesis was, well if we can help make it fun and entertaining.

00:11:50: There's lots of different ways in which people go to entertain some of its socials ,some of its competitive .

00:11:54: Some of is data driven.

00:11:55: So there are a lot of different techniques that you could use.

00:11:58: but I think the common thread over these fifteen years has been We're not trying to cure cancer for better or worse at Strava were not trying create Olympic athletes by any stretch.

00:12:10: Were trying keep people active.

00:12:16: We don't take ourselves too seriously and you can have fun on Strava as a member.

00:12:21: Hopefully, you could have fun largely as person who works at Strava or be a partner to Strava.

00:12:27: And that's been the common thread.

00:12:30: How much of that could you grasp once you started?

00:12:35: I think... The concept is not taking ourselfs too seriously and trying to create something would keep us motivated.

00:12:44: was there early on, in part because Michael and I used to joke if we were the only two customers but it kept us active.

00:12:50: It is a success.

00:12:52: so you know our bar for what was going to be successful in the early days was pretty low...it's like hey maybe we serve a thousand cyclists which was kind of our initial target audience?

00:13:04: And will be happy!

00:13:13: of what happens when you encourage people to be active and give them a platform where they can share that with their friends, stay connected and support one another.

00:13:24: It's powerful it is universal then goes across borders in its common language.

00:13:33: I think this has been called pleasant surprise but we could not have predicted people across the globe and everything.

00:13:45: It's far exceeded, I think speaking from Michael myself our expectations.

00:13:49: it's interesting to see throughout the last years how normal it became to share your runs or cycling sessions swimming session hiking anything else on Strava?

00:14:02: And then use that Strava like post and all those statistics.

00:14:10: it can be TikTok, Instagram or anywhere.

00:14:13: But the word of a mouth is so crazy by now that feels like everyone's using Strava even when one hundred fifty million registered users out eight billion something people are still smaller part It is and we'd argue too small.

00:14:37: I think if you were to talk to our shareholders, everybody else would still say wait why haven't we grown even faster?

00:14:44: And added more people?

00:14:45: so...I look at that as opportunity.

00:14:47: i'm excited for the team that's running in the company now because they see it.

00:14:52: We've always said ...we don't necessarily have to be in a business of convincing someone to become active.

00:14:59: We don't have to convince someone to get off the couch and do their first walk, if they want to we're there for

00:15:04: them.".

00:15:05: We've more believed that ten percent of the world today is active already!

00:15:10: They are all ready playing sports and doing their hikes and so forth... And If it's Ten Percent Of The World then what does that?

00:15:17: That's probably seven hundred million people.

00:15:19: So we'd love believe.

00:15:20: Strava still has lots opportunity.

00:15:22: growth can support a larger audience But to your point, we like our start.

00:15:29: Maybe it's taken us fifteen years to get here but its a really solid foundation and I think the community that is here will continue to invite their friends family members others join them.

00:15:40: so lots of future opportunity.

00:15:43: A question that I wanted to ask later, but i was on the phone with Jan Frodeno.

00:15:48: The former Iron Man World Champion earlier today and he said hey when you're talking to Mark You should ask him what the plan is for the future of Strava?

00:16:01: And how they plan On exactly the growth That you explained.

00:16:06: let me add one twist To that question because What would love to understand throughout the years when you thought about growth is, how did you decide between doing more of what we already did because there's still opportunity versus hey.

00:16:23: We have to add a new field like for example from professional cyclists who are adding runners as well and maintain their growth?

00:16:36: Yeah it's fascinating topic.

00:16:40: People are always asking, so what's next?

00:16:43: A few random thoughts in no particular order here but I think that they kind of give the context to which you're asking.

00:16:51: Michael and I come from an entrepreneurial experience both for our prior company as well as Strava where we're actually very comfortable taking risk particularly on early days going very deep, very narrow... The phrase used is a inch wide.

00:17:07: be extremely focused on a particular audience and their needs, and try to just do that exceptionally well.

00:17:15: To the risk of maybe it's not a large enough market or maybe we're not doing enough so our you know... We'd just start from a place where they would rather be great than big!

00:17:26: And if you look at where he started ...we were often accused being a hobby in part because our initial target audience was a very specific customer.

00:17:35: We've often used the acronym, M-A-M-I-L, mammal middle aged men in Lycra and that audience was that road cyclist—that person who is very passionate about getting out on their bike.

00:17:47: probably has spent thousands of dollars some carbon fiber machine but they love to go ride.

00:17:53: you know few days a week What we always wanted to explain to anybody who would listen is look, it's a go-to market strategy.

00:18:01: It's not our long term vision.

00:18:03: if We can go to market and serve this audience exceptionally well Our growth strategy will be A. Can we do the same exact thing?

00:18:12: But for new audiences And we always believe the next one in Strava would go from cycling To running.

00:18:17: so if we could do cycling then Could we do running?

00:18:19: well if he could do running could we add other sports but maintaining roughly the same experience just for a different athletic audience.

00:18:30: That was the strategy that we deployed, I would say we learned along on way.

00:18:35: you'd think to do what your doing for cycles and then kind of do some UI clever things into it from runners?

00:18:42: No!

00:18:43: It turns out you can't do.

00:18:44: that actually need take step back really understand running ethos be authentic.

00:18:54: And so it took us longer to get running right, but over time we built that out and now We're continuing to expand across activities, but now we are also trying to think about the way in which we expand across services that can offer our existing members.

00:19:33: Because by the last thing I will say on growth... Anytime you focus for growth's sake?

00:19:39: You aren't very good at it!

00:19:40: I shouldn't speak with an existing team.

00:19:42: When i was running a business when we would try and focus how do grow faster or not.

00:19:49: Our growth is organic.

00:19:51: When we focused on engagement and really trying to take care of our existing members, make sure that they were enjoying Strava.

00:20:01: That was when we saw our best growth

00:20:02: rates.".

00:20:04: I think it's just a testament.

00:20:05: the question you are asking around what comes next?

00:20:12: We're very focussed about how different things continue to see value from Strava the critical engagement metrics to not focus on vanity metrics like just the overall growth.

00:20:31: Yeah, well I'll give you one example of a metric that really started presented itself three or four years in what we gravitated towards and it was simply looking at the ratio.

00:20:45: You know, one of the beauties being a subscription business is we don't need to worry about time and app.

00:20:54: We don't have to sit there make sure that someone is staring at the screen because they need to scroll through some ads.

00:21:00: And so what became more interesting for us was hey Are we actually helping our members become more active?

00:21:06: are They spending more Time outdoors or they're spending more time doing The things that they love while their using Strava?

00:21:12: in fact it Was true the current numbers.

00:21:16: But back in the day, it was something like for every one minute of the app we were seeing an average of fifty minutes that people who are being active and out with their phone in their pocket or somewhere else... And that ratio is actually increasing!

00:21:30: We're seeing a fifty go to fifty-one, fifty two, fifty three.... So this example of metric which was pretty authentic to Strava wasn't something you just saw on other social media.

00:21:42: where was really then a pretty good proxy?

00:21:47: that, hey they're being active and if they are there more than likely going to subscribe.

00:21:52: They're gonna become subscribers...they'll remain with Strava..They will invite their friends so.... That's one!

00:21:59: I give you two others.

00:22:00: we were very clear particularly in the early weeks.

00:22:04: If can get someone just upload two-three activities it didn't take long.

00:22:09: but if got two or three activity is now enough data that we can begin to give them insight and feedback?

00:22:16: And could we get them to follow just two of their friends.

00:22:19: It's kind this two plus two mentality, if you've got two friends in activities... That began creating an experience where you would feel some connection on Strava.

00:22:29: You don't need a following network of one thousand people are enjoying the same activities that you are, and it's really fun because now again your kind of cuddling or high-fiving everybody.

00:22:45: You're seeing when somebody went for a run in the morning like I can do that!

00:22:49: iIcan go out get them thirty minutes this afternoon.

00:22:53: so those were the kinds metrics definitely helped us through these early days.

00:22:59: So knowing that you registered more than one hundred million users tons of time improving beyond boarding so that people are doing the two plus to during your time because Numbers might change over time still with with a new management team, but what percentage was Were you reaching off?

00:23:22: People who actually achieved the two-plus too.

00:23:25: Oh Yeah good question.

00:23:27: You know I want to be careful because I'm off the top my head and i'm not sure that I've got an accurate number for you.

00:23:36: It'd be easy to me sit here and say, oh it was a massive

00:23:40: percentage.".

00:23:42: Actually that's really great question in terms of sort.

00:23:45: what our hit rate success rate on the two plus two?

00:23:50: I can tell you this is good without knowing the numbers or trying to hide them but actually its something i could go try dig up from us about some follow-up conversation we have with it.

00:23:58: The reason why im confident even today I think the number that's pretty accurate, something like ninety six plus percent of our growth still remains organic.

00:24:11: Word-of mouth and so... The reason that percentage can remain so high is because these this ability to get people engaged on Strava fairly early and then get to a point where they're wanting to invite their friends and come in very strong.

00:24:28: So i would You know, whether it was a majority or just strong percentage.

00:24:34: It's always worked well for us and again goes back to this thesis of hey let's focus on engagement.

00:24:39: are our current members having fun?

00:24:42: Are they entertained?

00:24:43: Or getting insight from Strava?

00:24:46: And if so we were always impressed with what happened in the rest business.

00:24:51: I'm asking because no matter how much time you spend this number will never be a hundred percent.

00:25:01: And so also giving the perspective for people actually working on it, that it might take time and effort to get to certain level but it will not perfect because its just not possible.

00:25:19: you'll lose in your journey You know Fabian?

00:25:26: It's really important point Emphasize.

00:25:29: In fact, not only would I agree with you a hundred percent and um i'm Not holding back on the number because I know it i'm not proud of It II think to your point.

00:25:37: maybe I would say?

00:25:39: I'm not sure we've ever been able To nail what it is.

00:25:41: We just fundamentally can see that good things happen from it And whether it was ten percent or twenty percent Or seventy percent The thing That I will also share though.

00:25:50: particularly in the early days We came to appreciate that oftentimes doing Things that don't scale long-term led to some of our best outcomes.

00:26:01: So I'll give you a silly example in the earliest days of Strava, many don't know that when we launched the business... The only way you could participate on Strava was if you owned a Garmin cycling computer—the kind thing You'd finish a ride, you take that off of your handlebar and plug it into the backyard computer.

00:26:21: These devices didn't have Bluetooth then they weren't Wi-Fi enabled so literally there was a lot friction associated with doing that.

00:26:29: And one thing Michael did is we went to a local Costco.

00:26:33: I don't know if you've got Costco in Germany but here's like a Walmart just big shopping center.

00:26:41: We would go buy couple hundred garments as cheap as possible And we would hand them out to friends and Friends of Friends with a commitment that, hey if give this to you will participate on Strava right?

00:26:55: You'll do this.

00:26:57: As crazy as it sounds like... We can talk today about two million members every month but I remember the days when were adding three people and four or five.

00:27:12: It is a lesson in patience and persistence.

00:27:16: We often refer to the three P's, patients' persistence and then maintain perspective.

00:27:22: And that's these... A lot of these things you'll do.

00:27:25: it's not that there's one silver bullet That all of a sudden launches business.

00:27:29: Its just series of thoughtful Hey are we learning or reiterating?

00:27:35: Okay lets try this.

00:27:37: What encourages someone?

00:27:39: We realized one day, I'll give you another silly example relative to it.

00:27:43: People go for a ride together but maybe they're not all on Strava.

00:27:48: so how do we make that easier?

00:27:49: Well, we just simply added a little button on your activity that says hey add others and if someone was riding with you but they didn't happen to be on Stravah or they forgot to record their ride You could click Add Others And quickly add them into the system.

00:28:04: That little thing paid huge dividends So, but it was test and iterate.

00:28:10: Right?

00:28:11: It wasn't?

00:28:12: one day we launched it users to have the Garmin because that's the only way we will in the end, Have The Data.

00:28:43: Yeah much more of a ladder you're spot on.

00:28:47: it had to do with the accuracy Of the information.

00:28:51: again You have to go back to those early days.

00:28:53: two thousand seven two thousand eight two thousand nine.

00:28:56: That was uh?

00:28:58: The Garmo is really one of the few trusted devices where the data coming In Was accurate enough that the feedback We could then give our members would ring true.

00:29:09: The problem we had with the smartphones of that era, A their battery life was really bad so you couldn't go on a three or four hour ride.

00:29:16: but B even if you could record it...the GPS chips in those early smart phones were very poor and so we just couldn't trust other devices.

00:29:26: So I don't want to say stuck But we're thankful at least Garmin was out there.

00:29:31: We can use them.

00:29:35: Garmin's were expensive, and so it was a big limiter to our market.

00:29:38: And thankfully by two thousand nine uh... Two thousand ten you could really start to see that the smartphones Were improving dramatically?

00:29:51: That is when we launched our mobile business or mobile app.

00:29:54: When you talk about inflection points in the business that Was a big inflection point.

00:29:58: once We are able To get Strava on mobile and begin building The mobile app The game really changed for us.

00:30:05: So then when Garmin wasn't the platform that you wanted to grow with mobile and the app store was?

00:30:13: Yeah, it became that again.

00:30:15: It's so easy in hindsight like of course yeah wouldn't she want try get on the App Store?

00:30:19: You know we were all early app users and so forth.

00:30:23: We weren't trying to do because we thought would best be the best growth path.

00:30:27: candidly That reason we were largely trying to launch a mobile app was just to reduce the cost and friction associated with joining Strava.

00:30:35: If we were basically telling you, hey come in join us but it costs you three hundred dollars to go buy this garment?

00:30:40: And then your gonna pay us sixty dollars a year that is big lift.

00:30:45: so at least if could get into place where somebody can use their existing smart phone to track there activities... That reduced the friction in massive way!

00:30:55: So what we learned pretty quickly By partnering with Apple, by partnering with Google becoming a good app and so forth.

00:31:06: You're absolutely right.

00:31:07: we really started to see our growth take off within those on those platforms and so fourth.

00:31:13: but the first step was just to reduce the friction associated with participating in Strava And then from there taking advantage of the growth opportunities.

00:31:23: So... The important part is that We found out niche But at first we had a lot of friction because you have to own the Garmin.

00:31:31: So your two things that don't scale moment was, buy Garmin's hand them out get the first users.

00:31:38: We test if the hypothesis is that we have works and then You saw it working with some people.

00:31:45: Then mobile came along And were like okay now Now I've got an opportunity To find more people That might love using Strava Because Of less Friction Yeah.

00:31:56: And not to make things even more complicated, but just sort of show you these funnies or nuances... The other thing we were trying to test very early and I would encourage all entrepreneurs do this- We're also very dedicated in monetization from day one so we didn't want a build something.

00:32:14: try get as many users possible then figure out monetization later.. We launched with subscription basically within the first few months.

00:32:24: Our original subscription offering because it was this Garmin related, was hey you could upload for free five times a month but after that fifth time the sixth time.

00:32:35: You have to pay so you can just keep it to five and always be free or It's usage-based And it worked really well.

00:32:44: our conversion wage were exceptional in those early days Because once somebody was used to it they didn't want to stop their rides.

00:32:52: Stop uploading.

00:32:53: However, when we launched the mobile app which was largely treated initially as a recording device because we were trying to create the mobile App is an alternative to The Garmin.

00:33:05: We ran up against this problem Which was well?

00:33:07: We can't tell people to stop using the Strava mobile app to record after the fifth time.

00:33:13: So at that point we shifted our business model to be feature-based subscription.

00:33:18: so there's a whole bunch of features that are free and then you can get these new features if you pay.

00:33:25: And it was the right thing to do, now we're ten or fifteen years in... We were really happy with this subscription business but talk about creating new friction!

00:33:36: Now, the subscription side of business was far less obvious.

00:33:46: It's very binary as usage-based and now with a feature base we had to learn how sell these upgrades why somebody should... For years were always told our free is good!

00:33:58: We don't need to

00:33:59: pay.".

00:33:59: And they're kind right.

00:34:05: it took us long time really build value into the subscription side to the point where now we can say, no it's really good.

00:34:12: It's worth paying

00:34:13: for.".

00:34:13: What made it good enough that people are like hey I'm paying for that?

00:34:18: Well i think there have been three areas that uh... We've done things.

00:34:22: so um one- There is a handful of competitive things.

00:34:26: you only get on the subscription site around leaderboards and so forth today.

00:34:33: And so not that everybody's competitive, but for those who are and they really like the context.

00:34:37: They'd be able to compare it understand how their doing relative to their peers or other sort of... I mean we look at leaderboards through all kinds different categories.

00:34:47: So there is a competitive element.

00:34:49: There'a big training elements associated if you're training something whether its marathon or triathlon whatever event might.

00:34:57: There's a really great set of features associated with the training elements in your fitness and so forth that you would own, receive on that front.

00:35:06: So... In some respects what has happened over years at Strava is this social side to it.

00:35:11: we've made sure we wanted to keep them free-side.

00:35:14: all the connection All community ability support one another.

00:35:18: That always there.

00:35:19: But as we have dug into when someone was trying plan for something Set goals how are they going to achieve those goals, what their competing for.

00:35:30: That seemed like a natural place to build that paywall.

00:35:33: I have one question out of curiosity How long did it take you to reach the first thousand users?

00:35:40: Oh Yeah another good question.

00:35:42: i gotta get all this history right.

00:35:45: Long actually a thousand users he was probably...I'm gonna Take a guess and say our two years.

00:35:53: I know this because if we started, what we started putting users on in two thousand eight.

00:36:01: In the summer of twenty-eight was when we had our very first sort of beta user's two thousand nine.

00:36:05: We launch and end of two thousand ten.

00:36:09: Was When?

00:36:09: Did Our First actual outside financing?

00:36:13: And The Reason We did That Was that We were Really Beginning to See Strong Organic Growth and strong Conversion To to premium, to the subscription.

00:36:23: And if I'm not mistaken when we did that financing at the end of two thousand ten they were about five thousand users.

00:36:29: so roughly two years in... Two and a half year's in We'd gotten to five thousand.

00:36:35: i'm guessing though That we got from a thousand or five thousand pretty quickly.

00:36:38: So all bet it took us A good two years To get through our first thousand?

00:36:42: I always love that because It feels like Strava is there forever and was Always large.

00:36:47: but you also struggled to get these first users and had two, then also to maintain them.

00:36:53: So it's probably the harder part too.

00:36:55: Also figure out how they stick And actually use a product.

00:37:00: for everyone who is currently building They might be in the first spot of like Hey!

00:37:05: How do we get the first thousand users that are using it?

00:37:09: Because if I would ask When did you find For the first time The First Thousand Weekly Active Users?

00:37:16: It will be even harder to get the number, so we are not trying to fetch it.

00:37:19: But still there's certain levels that come step by step and just take time.

00:37:27: A hundred percent!

00:37:29: If I can leave any message with your audience today... if we could do this anybody would do it.

00:37:35: but you have to sort of be patient And really begin thinking about who is Your customers and are you taking care of them?

00:37:46: I remember that they our first paying customer who was not an employee at Strava.

00:37:50: his name is David.

00:37:51: He's still on the platform today, i know Who he Is.

00:37:55: uh...he's a friend.

00:37:56: he lives here in bay area And You Know..I Remember him.

00:37:59: and then I remember Mike and I Still remember The First dozen That were willing to sort Of test and iterate with us, be on Strava.

00:38:09: I'm sure we grandfathered some subscription for them over the

00:38:11: years.".

00:38:13: But you have to start somewhere right?

00:38:15: It's one of things that always get a little frustrated when talking about investors because sometimes they want to understand this big addressable market.

00:38:23: why aren't growing fast enough... The only way were going and we're only at a thousand.

00:38:30: now, I got to get the two thousand first.

00:38:33: And then from two thousand i gotta figure out how do you get four thousand?

00:38:35: Four thousand i'll get eight... There is this amazing sort of multiplier effect.

00:38:42: uh ...and that's part of the organic growth once you get a viral loop going in something which is why I focus so much on engagement.

00:38:49: if you have a loyal customer they are your best sales person.

00:38:54: And so by creating something that's highly engaged where people are very loyal to the product and they're using it, and they want to tell their friends.

00:39:02: That's what gets that flywheel beginning to

00:39:05: turn.".

00:39:05: A.)

00:39:06: It is highly cost-effective.

00:39:08: B.)

00:39:08: That multiplier effect Before you know it.

00:39:11: now you start talking about some pretty big numbers.

00:39:14: A friend of mine at Yad Mardash is co-founder of ResearchGate.

00:39:18: The first time I met him he told me hey I learned this one thing from my friend, Matt.

00:39:22: Matt was early at LinkedIn and Facebook.

00:39:25: And Matt told me exponential growth At first is super-super slow.

00:39:33: Yes it means that doubles but it doubles from ten to twenty for twenty two forty From forty to eighty.

00:39:41: It's like Super-Super Slow!

00:39:44: The tipping point comes where its fast But you cannot mistaken, slow exponential growth for no growth because that's still a sign of there could be something.

00:39:56: Yes and especially for social products in community products.

00:39:59: That so important to keep in mind Because we are all of us trying To grow faster and faster And reached at one number that We have In our minds.

00:40:09: it can Be ten thousand can be hundred thousand Can be A million whatever Without giving the time For The foundation to build.

00:40:18: That's right.

00:40:19: This is why I keep coming back to engagement too because the risk that sometimes entrepreneurs find themselves in, they feel this need to figure how to push that curve faster and so then what they try?

00:40:30: do it as they spend into it?

00:40:33: When i say you have to be patient again...I'll speak for Strava experience.

00:40:39: we were never good at doing paid acquisition trying sort of what would happen anytime.

00:40:47: Maybe we'd be successful at adding members, but they wouldn't stay engaged.

00:40:51: So there's a certain quality of the user that you want to find.

00:40:54: You have to find somebody who genuinely wants and needs The product And so by focusing on engagement in end when we got someone in again How do we get them?

00:41:06: To start following some people?

00:41:07: how did we get him to start uploading activities if They're engaged?

00:41:11: now We've got retention And having that retention is a big piece of being able to double.

00:41:18: If you've got high growth but high churn, uh... You're not getting that exponential effect because for every two year adding if your losing one-you really need add three or four even get close to doing it.

00:41:32: so That's and I think some entrepreneurs make the mistake they raise the capital like okay good now we can go in pay to these members.

00:41:41: join register.

00:41:44: No, I would caution people.

00:41:45: It's like you gotta look kind of the way you were describing earlier.

00:41:48: You got to look down the funnel?

00:41:50: He got a look at not just who's registered but what is that monthly?

00:41:54: What does that weekly?

00:41:55: What is that daily active lookalike?

00:41:58: What are those ratios?

00:42:00: How do you segment them?

00:42:01: What's happening in our case?

00:42:03: we quickly became international so now We're really trying.

00:42:05: understand i'll give you a case in point.

00:42:09: for whatever reason The uk has, for fifteen years outperformed every country on the planet.

00:42:15: for us in Strava.

00:42:16: There is something about the population of the UK and their density there... Their passion for being active.

00:42:25: we've never really been able to recreate the magic that happens in the

00:42:30: U.K.,

00:42:30: but it was a bellwether.

00:42:39: It's that desire to really stay engaged with whoever is on your platform and help them stay active.

00:42:46: That's a far more valuable use of time than trying to figure out how to just juice the early numbers.

00:42:53: Internationalization as an interesting topic, did you proactively try to create it or did you reactively work on it?

00:43:02: because you saw hey our app was downloaded in the UK now?

00:43:05: Or other countries?

00:43:06: yeah I would say it started as the latter, we were reacting to just an interesting phenomenon which was that this concept of sort-of sport and people's networks turned out be without borders.

00:43:22: So really... It is kind of funny—I find even on Strava as somebody who has a long time member and have lots of followers and follow a lot People I follow who are really my local folks, who were on the same trails and same roads as I am.

00:43:38: But then I have a just-as interesting or more interesting sort of international following where you know...I'm giving kudos to people in UK Brazil Germany Portugal Tokyo And we all had this common language.

00:43:54: So that happened without us doing anything.

00:43:58: Then We Had To Be Much More Thoughtful Around.

00:44:02: Okay, not just how do we localize and make sure that this is in the proper language and the proper currencies.

00:44:10: And you know all of the obvious.

00:44:12: but actually over time I think we've started to learn... We're getting better at.

00:44:17: even cultural nuances associated with sport are very different.

00:44:23: The example i'll use Brazil has been a fascinating country for us in Strava And I've now been down there multiple times, as is my co-founder and other executives.

00:44:35: We have a team that works down there but they're... They had this amazing sort of way combining their social with their sports just unlike anywhere else in the world.

00:44:47: Their run clubs are phenomenal!

00:44:50: Hundreds and hundreds of people, when they go out... They run late at night.

00:44:54: When it gets cooler or the roads are safe and so forth ...they carry boomboxes to a huge party that goes down the road And thinking about how Strava supports that actually ends up being different than what you might say in San Francisco.

00:45:12: We've been more intentional over recent years trying understand How To Be An Effective Partner Wherever we're located, but that's taken a lot of time and And that's where we've thankfully been in place to put the resources and Put people on the ground.

00:45:27: And you know try to be part of the community.

00:45:30: When was the first time?

00:45:32: That you had The feeling of what we today call product market fit?

00:45:36: I'm not sure if that term existed back then.

00:45:39: yeah no it did and i think Year, year and a half.

00:45:50: As I mentioned when we raised our series A decided to actually raise outside capital because Michael and I had funded the business up till that time.

00:45:57: That was what really started having confidence.

00:46:00: not only do you have product market fit but perhaps self-funding.

00:46:04: it is being Pennywise and pound foolish.

00:46:07: in fact there may be something bigger going on here than then first realized But took us good...I would say It's been.

00:46:15: And also, I think it's...I would challenge any entrepreneur that product market fit is a kind of an ever-evolving thing.

00:46:24: So if wasn't just one day we didn't have in the next date?

00:46:28: We've got it nailed!

00:46:30: Like i'll tell you story that In very earliest days and summer of two thousand eight when first had our Very basic website asking friends to upload on it fifteen or twenty friends onto the site for the month of July and we ran a competition.

00:46:50: We basically put them in two teams, there was East Coast and West Coast here on United States And he said hey would you be willing to just for next months participate anytime your go-for-a ride upload?

00:47:01: What we saw during that month...we'd run these silly little competitions.

00:47:05: send out an email to the twenty friends.

00:47:06: say whoever posts fastest five K bike ride today We'll send you a pair of socks or, we were doing silly things like that.

00:47:16: But we watched their behavior over that month.

00:47:19: Uh...we saw the amount of emails going back and forth between this group.

00:47:22: We watch kind of trash talking in the jabs at each other And we realized there's something here- We may not have business model figure out but look at how they're engaged with one another.

00:47:40: I would say that, that gave us enough confidence to keep going.

00:47:44: To start thinking about maybe we should hire some real developers and really start to think about how he could commercialize this?

00:47:50: And then when we started seeing the conversion rates on the subscription, it was a little more confident.

00:47:59: so product market fit.

00:48:03: but you give me.

00:48:05: So we had Product Market Fit for the mammal, that road cyclist.

00:48:09: But that didn't mean we had product market fit for a runner.

00:48:12: We thought we did and then when we launched our first running app it was horrible!

00:48:16: And...and..we had to go back to drawing board and really started higher runners into companies so they could speak their language in understanding them.

00:48:25: And we started this journey again.

00:48:27: So Product Market FIT is sort of an ever-evolving expanding and contracting phenomenon.

00:48:35: You know, don't ever think.

00:48:36: you've got it and you're done.

00:48:38: It's more that how do you just keep looking for those little milestones along the way?

00:48:42: Those little signals?

00:48:43: they give you confidence that you are on to the right path.

00:48:46: Could you say or when you think back to it Hey every time we doubled its size We had to reiterate on product market fit Or in a community once were deeply enough into the cyclist.

00:49:02: We found all of them more professional cyclists, therefore we had product market fit for them.

00:49:07: but for a broader cycling interested persona?

00:49:14: What were the layers of product-market fit?

00:49:16: is there anything that you could call a framework?

00:49:20: probably not and what do you realize when looking back at

00:49:24: it?".

00:49:26: I'll give one example quite a bit here to our business model, which today, ninety percent of revenue is the subscription and it's a freemium model.

00:49:37: So the vast majority of members on Strava are free but we have healthy substantial percentage who pay us.

00:49:46: so the framework that often use.

00:49:49: once you saw flywheel organic growth in free members were joining by.

00:49:55: Let me preface something here that's important.

00:49:57: Our free members are incredibly valuable to Strava, they're not just sort of you know uh freeloaders that we were hoping.

00:50:05: at some point we can get the pay anytime someone is free.

00:50:08: they are uploading activities to strava which increases the value of the platforms.

00:50:13: so where... We have no problem with the vast majority of our members being free but a framework we use how the free population is changing relative to demographics, relative to use cases.

00:50:31: Relative to geographies.

00:50:33: and as we think then about the subscription business which has obviously that heartbeat of-of how we grow and succeed... That really evolves our product market.

00:50:43: fit thinking because so probably the silliest example I can use as we transition from cycling to running one other things it really changed for us was the demographics around gender.

00:50:55: As a cycling company we were ninety-ten, ninety percent male ten percent female.

00:50:59: but once you begin adding running there's more female runners in the world than they are male and we quickly had a population on Strava today where equally fifty-fifty it is equal male or female.

00:51:10: But alot of our paid for features We're pretty focused on that competition, focussed on things That weren't necessarily appealing to.

00:51:21: I don't want.

00:51:22: There's plenty of women I know who are competitive, so I don't want to over-generalize.

00:51:26: But we needed to really understand how we were speaking to these different audiences not just to a runner but to a female runner.

00:51:34: We learned about safety and thinking ways in which people wanna present themselves on Strava.

00:51:45: Silly little example.

00:51:46: it took us way too long.

00:51:49: many folks men &women they dont' wanna share their pace on Strava.

00:51:55: Okay, let's make that something you can

00:51:57: hide.".

00:51:58: So it was an evolving thing but the framework we would use as we were getting these members in and they are using Strava if wanted to see them become subscribers.

00:52:08: how do we have evolve this side of paywall?

00:52:12: To create a conversion opportunity?

00:52:16: over last few years has been where product evolution is come from.

00:52:21: One question that I have in mind is how do you with the growing audiences, to growing feature sets?

00:52:30: The growing needs that you have to fulfill also as an internationalizing company.

00:52:37: With localization for all of different communities How do you structure it into a tech team For example not even the general team but starting from there To build a global community app that delivers to so many different audiences in so many countries and languages, I think figuring it out could be one of the hardest challenges over years.

00:53:07: A hundred percent!

00:53:10: The phrase often times is we are both blessed and cursed with a noise-of opportunity.

00:53:17: It's deafening.

00:53:17: There are so many things that we can do for our members, and what should be doing?

00:53:21: What would you like to

00:53:23: do?".

00:53:24: We're always going to be resource

00:53:25: constrained.".

00:53:28: To answer your question of how will we organize... First off, we've probably tried every organizational model which has been developed on the planet by other companies—we have probably tried it at Strava some point in time.

00:53:39: So there is no right or wrong.

00:53:46: What kind of resources you have?

00:53:47: I would say if there's been one guiding principle that has served us well, when we kept our organization what i would refer to as product centric.

00:53:59: Meaning... If were going keep investing let make sure are product organization which is really our product team which is product management and marketing design And then most importantly engineering.

00:54:13: You know, Strava is a software company.

00:54:15: So if we're well invested there and thinking about the needs... The resources that team has it's not to say everybody else isn't important.

00:54:27: they are.

00:54:28: We think highly of all our teammates but That business will thrive when that product organization is firing at one hundred percent Is firing sort on all cylinders And working really And that has evolved over time.

00:54:43: I can only imagine right now what Mike Martin, the current CEO is thinking about as we continue to implement machine learning and artificial intelligence into Strava and think about the ways we use that but all keeps coming back to his product org in a way then the rest of company supports that.

00:55:03: so thats the nucleus inside Strava ebbs and evolves depending on, are we very focused on launching a particular sport?

00:55:14: Are we in a moment in time where were trying to understand different piece of our demographic.

00:55:20: There have been moments into your point when you've really thinking about how we localize more effectively the key markets.

00:55:27: I know one things Mike Markins got right now is he has five or six market today.

00:55:33: that mission critical for Strava's future.

00:55:35: so there They're kind of organizing the whole company around how to ensure that those five or six markets, you know perform exceptionally well.

00:55:44: So there's a... I would just probably what I would tell any entrepreneurs is like go with some confidence within org structure that she can use.

00:55:53: if your going be at tech company it has to be within product.

00:55:57: we don't have sales team so everything has to happen not only the product itself but all the sales and marketing in the app, in the experience itself.

00:56:08: That's why that organization.

00:56:10: we spend an enormous amount of time trying to get it right.

00:56:13: but by the way when I say try and get it is very different than having gotten it right.

00:56:18: We've had a lot heads-of-product over years.

00:56:21: We have ebbed and flowed A lot trial & error.

00:56:27: So Strava has few hundred people.

00:56:30: now When you were running product in the center, how large is a product team?

00:56:39: In percentage of total team size.

00:56:42: Oh gosh!

00:56:43: Easily two-thirds to seventy five percent.

00:56:46: yeah it's when you incorporate again that sort of engineering being the largest population I mean typically at least half the company as kind your core engineering and everything related.

00:57:00: so maybe data science Fringe on that, but fundamentally your developers and then the designers.

00:57:08: The product managers in others around it That's yeah two-thirds to eighty percent of the business.

00:57:15: Because who else is there at Strava?

00:57:17: We have we have an amazing marketing team particularly you know off platform.

00:57:22: So the team that does handle a lot of our social media and thinking about brand building, and so forth... And Brand has been important to Strava.

00:57:30: we've always felt like we had to invest in that or consumer brand.

00:57:35: What are we doing outside?

00:57:37: There's a big partnerships team as you can imagine.

00:57:41: We want to integrate with everybody in the world.

00:57:44: make sure they're great partner out there pretty connected to that product organization because at the end of day, that has to work well.

00:57:53: And then you get the overhead folks like myself just trying not sure they keep everybody organized but... That should be pretty lean!

00:58:02: At the end-of-the-day I always like to joke we're dedicated to runners and cyclists and fitness.

00:58:09: if you come inside We look like a sales force or an Oracle or name your software company today.

00:58:18: That's what Strava looks like and it is a great team, but yeah... It looks and feels like a software company because that's who they are.

00:58:27: Who were the first people you hired at Strava?

00:58:30: What was he looking for?

00:58:36: The first folks we brought on board….

00:58:38: Well let me take step back.

00:58:39: so there There were four of us in the earliest days, Michael myself his nephew Pella and then a great guy who's still with us today.

00:58:48: His name is Davey Kitchell.

00:58:49: we affectionately like to call him The Mad Scientist because Davey while not a trained developer he is really the person that helped develop our first website put a lot features into life And just happenstance.

00:59:03: That was sort of who was available.

00:59:05: Michael knew Davey cause they lived close on each other east coast.

00:59:09: Our first hires were two developers, and they were to individuals that we had known because When I talked about those twenty people we put on the platform in the summer of two thousand eight test, they were to have the twenty.

00:59:38: They are also passionate cyclists and athletes.

00:59:41: so We got them as users.

00:59:44: And then I like a joke when fishing we reeled them In an.

00:59:48: we've got them onto The team.

00:59:50: uh...and there where our first two developers between Them and Then we made a hire On the product management side.

00:59:58: Uh...the name was Nick at that time.

01:00:01: That Was it!

01:00:02: And you know, that was the core team.

01:00:05: That really existed for probably the better part of two years which is a course set of developers and we started to add some design elements to that and so forth.

01:00:16: Really that product team was what started build out at least until this time as we began generating revenue.

01:00:28: So when was the first time that the organization grew to a level where you were like, okay now we have to think about culture.

01:00:36: We have to thing management layers.

01:00:40: Everything then makes a professionalized organization over time?

01:00:45: Yeah I'll give two answers because I would say Michael and i having been previous founders together before we even started it.

01:00:59: Not that, not that we had at lockdown because I think a team starts to develop its own culture.

01:01:04: so i want to be careful with this statement but It was important to us the kind of company that-that we wanted to build.

01:01:10: So you know like a silly example...I remember Even with our first two developers one of the first things That We gave as a perk Was just uh A gym membership.

01:01:19: because hey, if we're going to be espousing the ethos of being active shouldn't we be supporting our team that way?

01:01:26: So there were just little things that we were doing in the earliest days.

01:01:29: But I think your question's a good one and you have to fast forward.

01:01:33: actually two or three years into Strava history... Actually it was probably more like four five where we decided at that point to sit down and codify our culture with.

01:01:46: They were there.

01:01:47: They had grown, they had sort of developed and then we decided as a team it's time for us to actually put a stake in the ground and really sort of name them And begin to build culture around those.

01:01:59: Those became what we call the Strava ABCs.

01:02:01: It was funny.

01:02:02: I'm sitting here.

01:02:04: Let me see if... Here you go!

01:02:06: I am sitting at my desk.

01:02:08: This is lucky.

01:02:09: So We developed the ABCS.

01:02:12: It was an A, a B and three C. So it's authenticity balance and then three Cs craftsmanship commitment and camaraderie.

01:02:20: And those were the values that frankly we could see inside The company.

01:02:24: at that point We were probably fifty or sixty people and?

01:02:29: We felt like these are things That would drive a lot of our decision-making going forward.

01:02:32: so when I just pulled out on my desk Was the way we codified it was.

01:02:36: we created this coin and one side you have the word Strava And then on the other side, you have basically five values.

01:02:46: There was a hashtag carrythecoin.

01:02:47: everybody knew that I always had my coin in my pocket and would pull it out during all hands meetings... ...I would reference to doing key decision-making moments.

01:02:59: That really kind of helped solidify what it is.

01:03:09: they just naturally take place.

01:03:10: The silliest one that I always think of, we always had a much bigger bike locker room than our conference room or something like that.

01:03:19: there's tons of space for bikes.

01:03:22: if you came in around one o'clock in the afternoon into a Strava office it would often not smell very good because You can imagine that half the team had just gone for a run at lunch and come back.

01:03:34: We used to joke, hey there's always time for a ride or a run?

01:03:37: Just get your work

01:03:38: done.".

01:03:40: A lot of things naturally evolve that really become part of culture in the lore of business.

01:03:47: I'd like think it is still here today but with five hundred people its natural going change One thing we didn't spend much on yet you by now raised far north than a hundred million from investors.

01:04:03: And with investors, there comes expectation There is pressure for growth and at the same time You need to maintain A platform that has The engagement that you were looking For.

01:04:22: so the question I would love To put in perspective How did you navigate?

01:04:28: putting the users first, but still at some point also given a little to the growth expectations that you might have had from outside investors?

01:04:39: Yeah.

01:04:40: Yeah, Fabien You are striking right into Some of the best opportunities in terms.

01:04:47: We know we have some amazing investors and partners on our team But also some of the hardest challenges along the way just managing expectations.

01:04:55: I have an equation that was given to me by one of my CFOs years ago, and the equation is success equals results minus expectations.

01:05:05: That equation rings particularly true when talking about managing investors and the board and so forth... My quick short answer to you was it wasn't art not a science at constantly trying to bridge the gap?

01:05:21: It wasn't.

01:05:21: we were trying expectations.

01:05:26: We wanted to grow as quickly as the market would allow us too and so forth, it wasn't... So I think we were very much aligned in getting alignment with your board and with investors is critical.

01:05:38: you don't want be on opposite sides of a table.

01:05:40: And so i dont' think that we had misalignment.

01:05:45: but ill be first to acknowledge there have been many times in Strava's tenure when you know, a board meeting the vast majority of conversation is how can we grow faster?

01:05:56: And it's always met with well You know there's more dollars.

01:06:02: really do the trick.

01:06:03: kind of that conversation.

01:06:04: We had earlier here just a few minutes ago.

01:06:06: It's like pouring dollars in and driving top-line growth if you can't retain those customers.

01:06:14: Is this not very good business?

01:06:15: so also the conversations they would have and we would have good debate and healthy debate.

01:06:21: But ultimately, I think we have felt very good.

01:06:26: Case in point of all our investors who've been even from the earliest investor here's spend with us since two thousand ten they've never sold a share.

01:06:34: so They continue to believe.

01:06:36: and the growth of the business and on the upside And that to me is the signal In the same way That i look for signal From customers in terms Of you know are they retained?

01:06:45: Happy and paying Us from an investor standpoint, the fact that our earliest investors are still holding their entire position and believe in the future of business is a pretty good indicator.

01:06:57: we're doing something right.

01:06:59: Not without its challenges.

01:07:01: I could give you lots Yeah.

01:07:06: How we're trying to not balance quality over growth, but how do you get both?

01:07:12: Because one should be getting the other that they shouldn't be at odds with each other, But rather in a perfect world engagement.

01:07:19: like I said engagement led to better growth at Strava and so We just had to make sure we could prove That out.

01:07:25: can he take us into the boardroom for one of the harder conversations You had?

01:07:30: yeah gosh.

01:07:32: Well, there was an infamous one with ironically.

01:07:35: One of our investors who wasn't on the board but But Was welcome anytime and had a lot of experience in so forth.

01:07:45: And you know he he was just quick to come in.

01:07:49: it is very blunt individual So I'll just put it that way.

01:07:55: You know, you're.

01:08:01: not only are we not seeing the growth but your product isn't performing.

01:08:06: The way that it should.

01:08:07: and I mean he was just this sort of cold water thrown on what is otherwise set up as a meeting where there's lot good momentum.

01:08:15: But He came in with an attitude of This Is Crap And What Are You Gonna Do About It?

01:08:22: Why Aren't You Making Changes?

01:08:28: you can react one of two ways.

01:08:30: You could either get your hackles up and get defensive, try to go toe-to-toe or oftentimes at the end of day what I found is that best thing was listen!

01:08:44: The reason we have them as investors and advisors because they had a set of experiences.

01:08:55: And so that's what I did and listened, tried to acknowledge.

01:08:59: Tried to own... What this individual was saying where he was seeing the problems in saying we see the same problem as you do?

01:09:06: And then listening and also the other thing often with folks is say it a classic line than many people use but if your gonna come point out a solution.

01:09:19: So that became my rule of thumb which Okay, we hear you loud and clear.

01:09:24: What do you suggest?

01:09:25: We do.

01:09:26: what is it that we should be doing differently That we're not doing now?

01:09:29: And that did two things.

01:09:30: one Is that it calms the waters a bit because You basically are acknowledging hey were on The same page we do here that we have problems when I've got to go but It forces people will now start To Be creative in and Start to talk about what might be possible and thats where the real debate starts Because What I've found with investors is that they're really good at just telling you all the things you should be doing.

01:09:53: And what I have to remind them oftentimes, okay but at what cost?

01:09:58: Like what are we not going to do in order to go do that?

01:10:02: because i only have so many people and so much capital... So We can't keep adding into a to-do list!

01:10:08: We actually put some of this stuff either on hold or we have to stop Or we can't do these.. When You start getting into that trade off That's, I think when the real work gets done because that ability for people to acknowledge oh yeah we're going have make some trade-offs here.

01:10:26: We are gonna basically not do things you really care about in order be successful here.

01:10:32: so...that is a one silly one.

01:10:35: but look..we've had go through lay offs at Strava in past and wrongful death lawsuits investigations by the government at Strava.

01:10:49: Over the course of years, we've had lots of unexpected things that have come up—that have led to tension and how we should navigate them... And again being a good listener asking for solutions if you're going to raise problems ...and then really trying to get to that.

01:11:07: hey!

01:11:07: We are gonna make trade-offs.

01:11:09: You just can't be best everything all the time.

01:11:15: what you're gonna go do really, really well and be willing to sacrifice in other areas.

01:11:19: And I think that's the... You brought it up earlier?

01:11:22: How do you choose which features to work on next and so forth?

01:11:26: That ability is sort of navigate.

01:11:29: the prioritization of work is exceptionally hard.

01:11:34: And that's a place where boardrooms can be really helpful but you have And you have to have the right people in there.

01:11:42: So who am I looking for when i'm now starting out and looking For an investor?

01:11:49: Out of all your experience what makes a great investor?

01:11:53: Yeah, yeah another one that it's funny That she asked because I just had this conversation yesterday with an entrepreneur.

01:11:58: we talked about This.

01:12:01: so I'm gonna say something that is a little counterintuitive To my belief.

01:12:05: In general When I'm building teams probably not I love first-timers.

01:12:12: I'll take inexperience, but attitude oftentimes more so than i will.

01:12:17: sort of that senior person who's done it a thousand times except when it comes to investors?

01:12:24: When you have the ability to pick and choose... The first thing I point out to entrepreneurs is don't forget.

01:12:29: at the end of day the money is all green.

01:12:31: Investors are selling in commodity.

01:12:33: get the dollars in speed over greed.

01:12:38: As long as the investor you're dealing with is ethical and has a good reputation, you can make it work.

01:12:45: If you have the opportunity to be more selective I personally like to find investors who have very strong track record already The reason that's important.

01:12:55: if they've been able to be successful at generating returns for their partners They just simply have two things that are going on.

01:13:07: One is they have perspective, because that means they've probably been through a number of difficult situations and will be more seasoned and frankly more mature when it comes to having tough conversations—because there will be tough moments.

01:13:21: But the other thing that they had was they have credibility within their partnership.

01:13:26: Once you have credibility in your partnership, you can be more patient with your portfolio.

01:13:30: but if and you don't have any track record, so forth.

01:13:36: You are itching to try to get an

01:13:38: outcome.".

01:13:40: I just worry at times that particular investor will come into a boardroom and so desperately want to see an exit or liquidity event?

01:13:50: That they'll really be pushing the management team.

01:13:52: do things otherwise wouldn't wanna kind of been through the process.

01:14:04: They don't have to be operators, by the way I think there's a misnomer that somehow oh yeah i love this investor because they used somebody who's been really good at what they do.

01:14:29: And then, I want to talk with the entrepreneurs and ask them What was your relationship like?

01:14:35: When things got difficult were on their side or antagonistic?

01:14:42: This is a person that you've gotta be able to partner With so finding this person You feel like you can trust it worth every penny.

01:14:55: So you also have to be great at helping them grow into a role they never did, help them figure out things that I've never done before.

01:15:08: How are you approaching the assessment of your first-timer if it has potential for growth in those roles?

01:15:24: On the assessment side, I'll just give you two things that i love to look for.

01:15:27: One is...I'm just looking for a record of success.

01:15:30: so not just- I like to find somebody where okay maybe they haven't been a VP at marketing before but I can go back in their history and as I talk to them about their career when I talked about their school work what I see is a pattern of boy!

01:15:44: When they went and tried to do something?

01:15:46: They did it exceptionally well And it could be totally outside of the realm of what we're talking about.

01:15:51: So they don't have to, had done something great in marketing that might've been... I have a bias for athletics.

01:15:58: so if somebody has gone and you know their winning races and sort- That just tells me something about their dedication there work ethic and so forth.

01:16:06: So i'm looking for success In their background.

01:16:09: but The second thing I am looking For is A level of humility.

01:16:14: When somebody, I go back to my own sort of beginnings.

01:16:18: I was really fortunate to do my first company when I was twenty-five years old and part of why say it's fortunate is that... ...I was young enough to know?

01:16:27: I don't know anything!

01:16:29: I'm not sure how to market or sell but definitely don't have a code.

01:16:33: I graduated with a degree in art history so i dont' know how to write any software code.

01:16:38: And because of that.. ..i spent the time going find people who did.

01:16:42: I spent the time to go find really great marketing executives and salespeople, developers.

01:16:48: And then once i found them...I empower him!

01:16:52: Like GO!

01:16:53: You know your job better than I do.

01:16:55: you just tell me what resources you need now

01:16:57: help.".

01:16:58: So that was my background.

01:17:00: so there is just a ...the way it was raised.

01:17:04: its like incredibly grateful for what have been given in this humility thats still here both humble and has been successful.

01:17:13: And they're excited about the job, they want to go do it... They wanna prove to me that you can.

01:17:17: really well I'm willing take a risk.

01:17:20: How do i support them?

01:17:21: There's always advisors out there who have that experience That are more than going help.

01:17:27: It is amazing Once we start reaching out particularly in today where look at two of us California, you're in Berlin and we're having this great conversation.

01:17:37: You can find amazing people out there who are willing to give of their time And maybe it's formal or informal Maybe once a month Or every week Because they hire them because They just do something as favor.

01:17:51: But part of that humility That person has means they're willing To learn If they want to take it In.

01:18:01: go Great things happen.

01:18:03: Do you incentivize the advisors?

01:18:05: or is it more like hey, would your mind chatting with David who's now responsible for our marketing?

01:18:12: Yeah.

01:18:12: That's another really good one.

01:18:15: both have happened.

01:18:16: At Strava we ultimately did develop a very sort of loose advisory board I wouldn't even call it aboard more than an advisory network and those advisors Who did join they were given equity in the business And then they would earn it over time They don't think was like a three-year uh, vesting plan and that way they were available.

01:18:36: And it was very low-key.

01:18:38: um you know I'm thinking of...you know there's one person in particular.

01:18:43: well..there has been many of them but i am thinking about an expert on subscription who is literally written books going back to, she's great.

01:18:56: She lives here in California and we got her

01:18:57: involved.".

01:18:58: And she spent a lot of time with our product teams, with our monetization teams and so forth over the time just sharing sort of her own experience because she'd been not only writing books but consulting with hundreds of companies into space... You know they'll kind of spend a lot.

01:19:23: We've got lots of examples like that.

01:19:25: I love them.

01:19:27: now, we probably talked about a tonneau things definitely not everything That we could talk About.

01:19:32: but when you are given the last words Of this podcast episodes and targeted towards founders who Are currently building And often enough struggling as You know yourself even When it sounds Like Everything It's perfect.

01:19:48: There would be probably hundreds of moments that we could talk about where you were like, Michael and the whole team are like holy shit.

01:19:55: what is happening here?

01:19:57: What will your advice for these founders currently in this situation say?

01:20:03: hey I'm not sure when or how it might end up with.

01:20:09: my vision wants to be.

01:20:16: I will, I'll start by saying one if they've made it this far into the podcast.

01:20:21: Um-um...I'm really happy that you know They're willing to listen at this length and then put them to sleep.

01:20:28: And more importantly like If there are kindred spirits in this entrepreneurial journey Like just what your doing is important because i think Bringing your voice to an occupation and a way of life that can be extremely lonely Entrepreneurship is tough.

01:20:49: Like it's you know, there's kind of this dark underbelly as You've said like it's a lot of grinding It's a lotta grit.

01:20:55: It's A lot Of people saying no That doesn't work And you have To just sort of go past it.

01:21:00: There's This weird balance between Sort of having to Have this belief I Can make this Work yet being objective enough to Know hey when am i pushing something?

01:21:11: I've got a course correct.

01:21:13: And that's really

01:21:15: hard.".

01:21:15: So my first thing would be just like, you're not alone and we'll make sure... You can tell all your listeners how to reach out to me and I'm happy have conversation anytime.

01:21:24: but it's ... We are here support each other because were doing good stuff building things for people in being innovative.

01:21:33: This is the lifeblood of sort, what's going to make this world great.

01:21:37: And look we're in some difficult times right now so I you know... We don't need to get into politics but let just suffice it to say that entrepreneurs are gonna save the world and we're gonna figure out how to do it.

01:21:49: So that would be one.

01:21:50: then.

01:21:50: my second thing is like a dumb phrase But as soon as you can get comfortable with the uncomfortable The better You'll sleep.

01:22:02: This is hard work, but it is under the right perspective.

01:22:07: There's nothing better.

01:22:08: You get to control your destiny you get to decide.

01:22:11: I used to always joke The reason that i want her becoming an entrepreneur was so That I could set my alarm clock myself.

01:22:16: nobody had To tell me when I Was getting up?

01:22:17: I would Decide When I Would do It and You know that's.

01:22:22: I would just leave People with Folks that its worth it.

01:22:28: Just Gotta Be patient And Keep Grinding.

01:22:30: Know Your Not Alone.

01:22:31: Yeah, I have to add one more question.

01:22:34: What would you say is the recipe?

01:22:38: To not burn out throughout a more than a decade-long journey?

01:22:42: You know i referred to those three Ps earlier and that's patience persistence And perspective.

01:22:50: um...and That third one actually changed.

01:22:53: so The original Three Ps when we were building Kana was patients persistence and perfection.

01:23:00: I realized perfection is not something we should be chasing, but instead maintaining perspective.

01:23:06: So I would say there's been two goals and by the way i'm not always good at this.

01:23:11: my boys would tell you...I used to have something called SOB disease Fabian.

01:23:15: it was Strava on The Brain.

01:23:17: uh..i'd come home , i'd be having dinner with the two of them .

01:23:20: I'd ask him how their day had gone at school.

01:23:22: they'd start telling me in two minutes into the conversation they were basically saying hey dad what did I'd be so embarrassed because actually, I hadn't even heard it.

01:23:32: Because my brain was still just like spinning around how to do it.

01:23:35: So i'm preaching something that i'm not always good at.

01:23:39: but i would say number one is you gotta maintain perspective.

01:23:42: here we're trying To build things That bring joy into the world.

01:23:48: in our case at Strava We are trying Make It easier for people to Be active!

01:23:53: We think thats really important.

01:23:54: again as i said earlier I know when i'm active, if can just go run for thirty minutes of the day.

01:24:00: I am a better person and parent or co-worker , student partner and spouse to my wife .

01:24:11: And it's hard.

01:24:12: so that is what we are here do but not curing cancer like maintain perspective.

01:24:17: you're going make mistakes screw things up need own those part its perspective.

01:24:24: And the other piece around perspective is don't let your business and what you're trying to create define who you are.

01:24:34: You asked me earlier when we were off camera, why did I decide to retire from Strava?

01:24:42: Part of this is like...I will always be a co-founder or really proud of what Strava is!

01:24:49: It's one of many things that i've enjoyed.

01:24:52: But I can't let it defy, there's a bunch of other things that are just as important to me.

01:24:57: Whether its my boys careers and what they're doing... My wife Ashley.

01:25:01: you know our two dogs!

01:25:02: And i'm passionate about skiing.

01:25:05: so im chasing snow right now looking for great ski conditions..and I love entrepreneurship.

01:25:12: So Im constantly talking to young entrepreneurs.

01:25:14: You and I talked earlier.

01:25:16: There is amazing thing going on....I think your gotta make sure she have life outside of whatever it is that you're trying to build.

01:25:25: It doesn't mean that has to be balanced, there's going to late nights when your working on stuff and just have do it get through the grind but then occasionally pull out release valve.

01:25:39: make sure she got what ever other thing in this one or two things whether its workin'out reading good fiction spending time with your partner.

01:25:52: I'm not here to tell you what it is, do it!

01:25:55: You will be a better entrepreneur if you give yourself that grace... ...to occasionally have the release

01:26:01: valve."

01:26:18: with the podcast, especially because it's a lot of my work time.

01:26:23: And so actually me talking to people that might be even more easily identified with myself personally.

01:26:32: but It's hard too leave at as a doorstep when you're coming home and not thinking about it.

01:26:39: So definitely something that a lot founders will listen to like yeah he got me here But I'm no sure how change Again, it's that little thing of do what I say and not what I'd do.

01:26:52: I talked about that sob disease that I have in kind.

01:26:55: the way which just creeps-in is always there so its...I think theres some intentional stuff but speaking to you personally would remind me like You are multi dimensional.

01:27:06: Unicorn Bakery Is amazing What your building And whats your doing for people and should take great pride.

01:27:13: Right now is probably the time where you are investing a big piece of who you are in it and It makes sense to do.

01:27:19: I'm very careful when it comes to balance.

01:27:20: balance Is not something that happens daily or weekly?

01:27:24: It tends to ebb and flow over Time but i'm also here, to tell You how bet if u And i just spent another two minutes and like i got To start asking new questions i'd find other aspects Of your life That Are Just as interesting and just As important.

01:27:38: and what i will remind you is If you give that stuff time Unicorn bakery will thrive from it.

01:27:48: There's a misconception that somehow if I stop thinking about, It'd be off.

01:27:54: but at times what i've learned in thirty years is some of my best ideas have come when i've taken a break.

01:28:01: and you know often joke like My Best Stuff Comes When I Just Go For A Run.

01:28:05: When I Leave I Put My Shoes On And I go um...and don't think im going to Be About Business.

01:28:09: But Then As Im Going And it's because sometimes you just have to change your frame of reference and so forth.

01:28:17: So yeah, I'm a big believer that having those other aspects in life enhance what you're trying to do as an entrepreneur.

01:28:25: The coaching session...I didn't know i needed but thank you so much!

01:28:29: It has been such pleasure talking with you.

01:28:32: I would say probably not the last time we will do.

01:28:34: this depends on your end or years.

01:28:39: I really enjoyed it.

01:28:40: Thank you so much, i will link to your LinkedIn for people who want for it to take off and then also starting with Garmin handlebar attachments.

01:29:15: For your bike, and by computers that you had to have an now having more than a hundred million users said obviously don't have to have a garment.

01:29:25: they might because runners and cyclists and triathletes in everyone is into garments.

01:29:30: but To see where the started And how I devolved Is crazy inspiring?

01:29:38: taking the time and diving deeper.

01:29:42: Mentioned that we did, he now has a bit more times so you can slide in his LinkedIn DMs And he probably is able to take some time because he loves talking to entrepreneurs.

01:29:51: So if your building think that Mark could help with few insights He could be open to it In the end.

01:30:00: I love what Strava builds as community app Probably one of most loved community products out there for, especially in the sports industry.

01:30:11: And then a substantial business with hundreds of millions of revenue even when not all the numbers are communicated.

01:30:18: it's an impressive story and if you haven't checked out Strava feel free to.

01:30:22: otherwise I'll link marks linkedin profile In those show notes.

01:30:26: If You Don't Want To Miss Other Great Founders And Tactical Advice On Building Startups And Successful Companies please subscribe to the Unicorn Bakery wherever you're listening or watching and share it with a friend, because I can imagine at least one person who absolutely learns something out of this conversation.

01:30:49: Or shared on social media could also be super helpful for us!

01:30:52: I'm super grateful that your'e listening.

01:30:54: My name is Fabian Tausch.

01:30:55: You are listening to The Unicorn bakery And then looking forward to seeing back in next episode.