Full transcript: Kevin Hartz on London Real
0:46 Brian Rose: This is London Real. I’m Brian Rose. I also host London Real. It’s the same studio, a little bit different of a show. We’ve had guys like Tim Ferriss from the Four Hour everything. We had Neil deGrasse Tyson. We had local bad boy Ashley Walters in here last week and it’s a little bit different of his show. So check that out at LondonReal.tv. But today we’re here to talk tech. My co-host is entrepreneur Colin Pyle. You’re rocking Crew Cafe. We just all had a double espresso of the good stuff. Kevin said great things about it. How’s the coffee business?
1:16 Colin Pyle: Coffee business is going well. Yeah, things are going great. Again, going down to Italy in about two weeks to nail down a few more blends and you know we’re early days so we’re trying to you know streamline and create efficiencies in our supply chain and you know deal with multiple partners so but good happy days
1:34 Brian Rose: another financing round so I’m sure you know a few of those
1:37 Colin Pyle: yeah exhausting but but all good stuff
1:39 Brian Rose: good where did you raise your money from
1:41 Colin Pyle: angels so yeah the first first round was angels second round will just be angels again and then And then hopefully we’ll-
1:48 Brian Rose: Are they in the coffee business, or are they better or more tech investors?
1:52 Colin Pyle: Yeah, a little bit of both, mostly friends and family.
1:55 Brian Rose: Yeah, yeah, yeah. That’s the trend back in the Valley is you have a lot of tech investors now investing in coffee and chocolate and all these other areas. Interesting. Fun businesses.
2:03 I wanna hear more about the Valley, so let me introduce our guest. It’s Mr. Kevin Hartz, who is the founder and CEO of Eventbrite, which is the world’s leading self-service ticketing platform, helping anyone to set up, promote, and then sell out any event. You guys have processed over 200 million tickets, worth $2.5 billion. You guys have raised $200 million for yourself, valuing you guys, I think, over $1 billion for your company.
2:29 You personally invested early in PayPal, Airbnb, Pinterest. Your wife, Julia, is a co-founder. We tried to get her. We got stuck with you. Kevin, welcome to Silicon Real.
2:40 Thanks for being here.
2:41 Kevin Hartz: Brian, thank you so much.
2:43 Brian Rose: You know, you just came in from San Francisco, right? I guess about a week ago. It’s London Technology Week.
2:49 Kevin Hartz: It’s crazy. There’s like 200 different events. Daily. Daily. It is crazy.
2:54 Brian Rose: And I know your schedule has been just, I’ve been watching it on Twitter and it’s been pretty nuts. I know you’re off to campus London later. I was wondering, what does London feel like to you as far as technology wise? Does it remind you of the Valley 10 years ago? Or does it have a unique feel or I just wondered what your thoughts are when you land here and you start going around meeting people, things like that.
3:14 Kevin Hartz: Well, physically, London is so steeped in tradition, and you come to this beautiful old city, and by the way, it’s been a whirlwind in the last few days we arrived on Sunday. It is, as I mentioned, so steeped in tradition, yet when you get out of the taxi or the Uber and you get into these events, it’s almost indistinguishable. I think entrepreneurs are universal, and entrepreneurs migrate to these centers, and London is becoming one of these centers now.
3:49 Colin Pyle: That’s always good to hear. I always wonder where we’re at. People always say in FinTech, we have an advantage because we’re right in the middle of the banks are literally a mile away from us, and government’s here. It’s like San Francisco, LA, New York rolled into one in that sense, but I always wondered if it feels early on. Everyone’s really helpful with everything we do at Silicon Real.
4:09 They always want to help each other out. But we haven’t had a lot of the big exits that people have had over the years. And I know you were involved in some of these early companies as an investor. And I was just wondering if it feels kind of like it’s still kind of a secret that’s moving up or do you think it’s maturing really fast here in London? Do you guys think about London when you’re in San Francisco?
4:28 Is it kind of what’s going on in Europe?
4:31 Kevin Hartz: Well, we think about London from a business perspective, from an Eventbrite perspective, because it’s our third biggest city in the world from a matter of sales. And that’s pretty incredible for a small company out in San Francisco for Eventbrite to have that global nature to us. And we actually set up an office. We have a team out here in London and have been building that team.
4:57 We didn’t proactively do that. We reactively did that because of the adoption of Eventbrite in London. And also because it’s just a great pool of talent, you can draw upon the whole EU, and also we can launch into other markets from London as well.
5:13 Colin Pyle: I’ve got it on my phone. I’ve used Eventbrite without knowing it because a lot of events had it and they had the tickets, and so that’s always a good sign when my app is already on my phone before they get here.
5:26 Brian Rose: For people that don’t know the story of Eventbrite, can you just walk us through kind of when it happened and how it happened? You know, your wife is kind of a co-founder, which I don’t know if that happens a lot in San Francisco or anyone else, but tell us about it then, right?
5:44 Kevin Hartz: Well, we started in earnest in 2006, and there were three co-founders, myself, Julia, who also happens to be my wife, and Renaud Visage, who spends a lot of his time here in London. We basically broke all the startup rules and in the sense that at the time, Julie and I were engaged to be married, and it’s fairly insane to go into a business venture with your fiancee, soon-to-be wife.
6:09 And we also, and Renaud was, while he was a software engineer out in the Valley, during the first dot-com bubble, he worked for a photo-sharing site that was funded by Kleiner Perkins. That’s how I first came in contact with him. He was spending most of his time in Paris, so we had a CTO that was based remotely for most of the year. So from a startup perspective, the three of us had kind of all the odds against us.
6:36 Colin Pyle: And is Silicon Valley littered with couples that have started companies up and then went wrong?
6:42 And I mean, it must be hard to keep founders even on the same page normally. But is that usually a recipe for disaster?
6:50 Kevin Hartz: Well, couples, it can work brilliantly. It doesn’t work most of the cases. And what we had always in mind is that we didn’t want to destroy a relationship.
7:00 We are spending the rest of our lives together and at the time we were starting Eventbrite, we were really thinking that, okay, the worst thing we want to do is end up in some kind of conflict that destroys the relationship. So we always had this plan A or plan B that one of us would step out of it if there was too much conflict. What happened is that there was just this serendipity, There’s just a balance, a complementary nature that you find in founding partners that just work very well.
7:34 We divided and conquer is a term we often use where we just don’t overlap much in expertise and she focuses in certain areas and I focus in others and that is really the recipe for all great founding teams or for founders is to have that complementary expertise.
7:55 Brian Rose: When you started at just organizing local events in Silicon Valley, I mean, it was started off as kind of just a free service. Was that…
8:06 Kevin Hartz: Yeah, we really… We launched as a very basic service that was based on PayPal, only PayPal really helped us get off the ground a lot like UC Stripe today, the Irish Brothers.
8:20 We didn’t spend our time rebuilding a payment system. We built a very basic system, but we really thought about low friction, is how can anybody sign up, publish an event, and start selling tickets in a matter of minutes. And in 2006, that was fairly unique. And we started it, we kind of hard started it by really speaking to our friends and colleagues in the industry and watching them and seeing how they use the product. So we built something that was scalable, but it had a really human element in the sense that we were watching, helping, learning from them in the process.
9:03 Colin Pyle: And when did it start expanding to other cities or started becoming paid for? When did you kind of see that kind of light?
9:12 Kevin Hartz: Well it’s one of those classic tales where we had focused on tech conferences because it’s what we knew and they were great early adopters and other tech conferences mainly you know blogs were exploding at the time and diversifying their businesses by starting a whole live event and so other conferences started to pick the service up so TechCrunch was one of our first and many other many other blogs and and conferences followed after that and And that’s that initial vector of growth.
9:47 But also at the time, we like to look at building business in terms of what vectors do you grow off? What kind of drafts tailwinds can you use to grow? And at the time, it was SEO. Google was really gaining prominence. And you were seeing a lot of companies grow through great organic search.
10:09 And Yelp was an inspiration to us what Jeremy Stoppelman had built in terms of indexing local businesses and seeing a lot of traffic coming from that way. And what started to happen after we primed the pump and spent a lot of hard work watching the customer, working with the customer, getting this flywheel going, is that we saw Google search picking up this really interesting local content that started out as tech conferences, but then were classes on photography or dance or bands playing in small clubs and these sorts of things.
10:43 Brian Rose: And was there a point where you felt it turning or tipping or you were like, okay, this is kind of growing on its own?
10:51 Kevin Hartz: You know, maybe I’m paranoid, but I always felt like we’ve always had to just be pushing and pushing and pushing. I don’t think we ever, you know, one may look back and, you know, we’re really proud of what we accomplished, but I think we’ve always been pushing the business. I think we’ve had a, we’ve taken advantage of a lot of beneficial tailwinds as we say, whether it was SEO and then the social revolution happened and all of a sudden we saw traffic coming from Facebook and more deeply integrated in Facebook and people started sharing events and that was a great factor.
11:25 We created, we made free events. If you were holding an event that didn’t cost anything, you can use our service at no cost. You’ve got this full featured platform And today, two-thirds of our events are free events and tens of millions of people attend free events each year on Eventbrite and they learn about Eventbrite and they turn into paid sellers themselves, many do. And so these natural drivers of growth, these virtuous cycles all really helped kind of sweep us up and I still always feel it’s a good battle every day And, you know, we’re only as good as kind of the next adventure ahead of us.
12:10 We probably should look back more and enjoy ourselves, but I think we’re looking forward to really enjoying the challenges ahead.
12:19 Colin Pyle: Just out of curiosity, what was the spark for the idea for Eventbrite? Was it a pain that you had where, you know, I’m tired of buying these tickets or, you know what I mean, and just that this all could be digital? When did that happen and maybe who had the idea?
12:36 Kevin Hartz: That’s a great question. It was really around, it feels like ticketing, and I use ticketing as a general term. I think that we kind of take ticketing with the O2 Arena, Royal Albert Hall, the World Cup, but it’s really something much broader. It’s any type of live experience.
12:55 We saw this, we think it was this last bastion of e-commerce, this completely untapped area where people were putting up flyers, or sending out emails, or trying to promote the so-called long tail of events. We saw this massive opportunity to be that solution. And really, the part of the vision is around live experiences, is that we love the notion of people gathering. It’s inherent to who we are. It’s part of, if you talk about Maslow’s pyramids, It’s one of those kind of core needs.
13:34 And what we’ve seen is people coming together around live experiences, whether it’s on the professional side, whether it’s to see a band play, whether it’s to watch a sporting event, whether it’s to compete in a Tough Mudder race, which are these crazy obstacle courses started by-
13:50 Brian Rose: I was on one about a month ago.
13:52 Kevin Hartz: Oh, good for you. How did you like it?
13:54 Brian Rose: It was tough. That’s what I told everyone afterwards, it was tough.
13:58 I put together a video with my GoPro head cam, And everyone was like, that looks like fun, but I cut out the four hours of running up hills. But yeah, it was a fantastic experience. And yeah, it was all about being together, and there’s no time limits, and I really like that. And that’s the, Will Dean created that. He’s, is he from London?
14:18 Kevin Hartz: Yeah, he’s British. He’s British Special Forces, and went over to Harvard Business School. And when he left business school, started that. And it’s just been one of these phenomenon’s of, I think that really typifies the live experience. Yeah.
14:32 Brian Rose: It’s interesting you said that it’s because we watch, you know, we watch live streaming and now you can stream concerts in HD and we’ve got Skype calls and we’ve got the social media revolution you talked about. And yet on the other side of that is this need for us all to connect and get together, which is the essence of your business model. And I was wondering how, do you see those kind of two battling in people’s heads or in people in tech space’s heads or us as humans going forward or we have all these tools to connect virtually, but we really want to connect physically.
15:03 Kevin Hartz: I really like how you said that. It feels like you’re really plugging a vent right now. I’m going to have to borrow that. Luckily, this has been archived, so I can transcribe this or something. That’s beautifully said, is that as we become more connected, in fact, technology has also enabled us to gather that, you know, a mobile phone given its characteristics or social media allows us to come together more easily and find out what’s going on or what’s happening around us.
15:37 And that’s really the vision of Eventbrite is to bring people together and not miss those great experiences or find new experiences that you wanted to be a part of. We see it as a media type, in the United States we have cable TV with a few hundred channels and you have your film and you have your educational channels and your sports and so on and we see kind of a, we want to be that cable TV of live experiences that cover every part of your life, whether it’s professionally, whether you want to learn something new, whether again you want to be challenged in sport, that you have this kind of channel guide to everything happening in the real world.
16:18 Brian Rose: Yeah, so you look at it almost as a media platform.
16:21 Kevin Hartz: Yes, exactly.
16:22 Brian Rose: It’s interesting how you look at things differently. It seems to be all the success stories out of, well, in technology or people just look at things differently and people talk about this recent Uber valuation and they say it’s because the president is not thinking about this as a taxi company. He’s thinking about it as a logistics solution. And it’s interesting, you talk about this being like almost a media vertical, getting together with people, whether it be for events or teaching or learning or something like that?
16:48 Kevin Hartz: Well, it’s one of the oldest media verticals around the Greek place. So we’ve gathered since almost the beginning of time, and it’s time to really formalize that more, and that’s really our mission. And so when we think about that, we think about, I guess there’s Nielsen ratings net ratings, if you have some ratings in the United States, but it’s how much time you spend watching television and these different things, and we foresee a future where you have that share of time that is spent in these live experiences that’s much more formalized.
17:28 And today there’s little bits and pieces of that. You go see a band, you run in a race, but we really want to understand and define that more and provide more variety to consumers because that’s really what kind of defines us as human beings, that we can gather and connect and discover and learn and all these great things.
17:46 Brian Rose: I think as a species we’re getting more and more frustrated because we think we’ve solved all of these things where you used to have to get together and go see a band live and now you can watch the music video at home, you can watch a DVD when you get home from work and relax, or you can do all these things where you communicate via Skype and I talked to my dad, but I haven’t seen him for four years, but I Skyped him last week.
18:11 I think we’re ultimately building this kind of human frustration, because we’re not getting out there. The Tough Mudder was probably one of the greatest things I’ll do all year. I was like this big thing, and we prepared, and I did it, and we were all there touching and looking at each other and having these emotions. Shared experiences. I don’t do enough of that stuff, and I live in London for God’s sakes, so I don’t know.
18:32 I don’t know why that is.
18:34 Colin Pyle: Yeah, I really sort of push against it because even just running a business, I thought, you talk about the start of Eventbrite, which is kind of ironic that here’s this company that’s bringing people together, but yet it was started with your CTO not in the same location. And it’s, for me, starting businesses, if you’ve ever spent a month with a developer not next to you or a designer not next to you, it can be hugely frustrating.
18:59 And you think, you know, until virtual reality, where you can kind of sit in a room, a virtual room with someone and actually work together. I don’t think Skype is, you know, it’s just, it’s a great service, don’t get me wrong. I love it, but.
19:14 Kevin Hartz: We’re seeing those challenges today as we expand and try to communicate or trying to maintain that communication with our London office, with, we’ve expanded in South America, we have an office in Argentina, a team down there, and it’s very difficult, but very important, given the global aspect of businesses today.
19:33 Colin Pyle: How many employees do you have globally?
19:36 Kevin Hartz: We have 373. Wow. Right on the money. There we go.
19:40 Colin Pyle: It’s weird, because you see an Oculus acquisition by Facebook, and it would seem like Kevin would just ring the guy, the portfolio manager, and be like, look, if you want a zero-correlated asset, it’s Eventbrite, because they’re almost like the two separate issues, aren’t they? One is you have to actually be there, one is you have to actually not be there. Does that come through your mind when you see a lot of that virtual reality technology and you’re thinking that’s great to have the tech, but we know there’s always going to be the need for the…
20:05 Kevin Hartz: I love the zero correlated asset. Another line I will use, that’s exactly right, is we often say that we imagined a world that we would be in the snow crash, if you’ve read the novel Snow Crash, it’s this science fiction novel of the future where you travel through inside of these virtual worlds through this oculus type of interface. That is what we all imagine the future to be. I think there’s this dichotomy of the online and the offline. The offline will always remain robust and to maybe take this at a different angle, What you see in the digital world is a lot of disruption, so you saw the disruption in the music industry, Sean Parker in Abster, in Sean Fanning, and the value of recorded music go to nearly zero.
21:03 What you saw was that the touring industry really took off, that artists then made their money going out on tour. That analog works in so many different categories. We see so many different traditional magazines that are building their business or expanding their business through having live events, you know, whether it’s around wine and food or whether it’s around certain hobbyists, Maker’s Faire is something that comes to mind that was just in the Bay Area and is starting to tour more and more, but Maker’s fair started from, you know, it was really a publication and now the Makers Fair themselves are these wonderful festivals that celebrate coming together and creating.
21:53 Colin Pyle: Do you have people like the traditional ticket people, are they now becoming on your radar or are you going on their writer as you get bigger and bigger, the ticket masters and the stub hubs and the people that have, I mean, I wouldn’t say they’re the music industry of the past, I didn’t say that, but is that something that you have to consider now as you get bigger and bigger, that you’re ultimately competing with these guys? Or is that now obvious to them?
22:17 Kevin Hartz: Will the incumbents, some incumbents are certainly kind of tied to the past and challenged.
22:22 I think you’ve seen in most cases that incumbents really have difficulty transitioning to a changing world and history doesn’t bode well. The previous company, I co-founded a company called Zoom as a money transfer business. And Zoom went public last year. I can’t claim, I’m no longer operating in that business. I’m running Eventbrite full time, but I remain on the board and have watched that business grow over 10 years to really put a dent in Western Union.
22:56 And Western Union is one of these offline brands that’s having this real challenge moving online because it’s disrupting its own channel, how it does business. but I don’t even need to use Western Union as an example of disruption in progress. We can look at Blockbuster, we can look at Barnes & Noble and so on.
23:20 Colin Pyle: And so those companies aren’t necessarily ones you’re targeting, but you’re going after a similar market.
23:28 Kevin Hartz: Our approach has been to, our vision is to encompass every live experience and we aspire to be in that market And we do serve a lot of music clients in a number of festivals.
23:41 And however, it’s a more competitive market. And what that means is that instead of banging our heads against the wall and trying to break into the ultra competitive markets, what we’re doing is we’re expanding into all these different categories that range, again, from politics, to classes, to conferences, to all these different geographies, our growth in Europe, our growth in Latin America. We still need to make a push into Asia. We’re just scratching the surface there.
24:17 So we try to, we always say, follow the path of least resistance. And I think that is a lesson for startups. Disruption doesn’t mean to take an incumbent head-on but there are many different paths to get there.
24:35 Brian Rose: 373 employees, 200 million raised. You started off with three, now you’re 373.
24:42 If you have any advice to anyone who’s kind of in a smaller level and is going to get to your level some day, what is the hardest part of running a company that big now? Is it communication? You might have a vision. You don’t look in the rear view mirror, obviously. How do you keep the whole company kind of looking forward without over driving them?
25:01 Kevin Hartz: You know, I mean, it’s really on the Soylent green punch line. It’s the people. Or is that, do you get that reference? There’s some film. Right.
25:12 Brian Rose: That’s what it was made of. Yes. Made of people? Yes. But it is all about the people.
25:18 Kevin Hartz: I’m testing that. It’s probably not a good line to use in the future.
25:21 Brian Rose: They were eating themselves. That’s our tag line on the Silicon Rail. It’s about the people.
25:26 Brian Rose: It’s not in that way. It’s about eating the people. We’re cannibalistic.
25:31 Kevin Hartz: Well, but there you go. Your tagline is more apropos. It’s you build a great company. I think that It’s so it is critically important to focus around the product In building a great product and making your customers happy but it’s critically important as important to focus around the team you build and so Finding those right people for those right positions really is the key aspect to scaling in the early days and what most of The listeners coming from the startup side, when you’re 3 or 5 or 10 people, you’re working on everything, you’re driving very hard, you’re moving the business yourself, but as you scale, that’s all really done by finding the talent that can actually do things better than you that are more sharpened in certain areas that can complement you, that can really help you scale and that was the the key to our growth at Eventbrite was finding where our weak points are and finding great people to fill those roles and that’s the key to it. In the early days it’s you know most critically important to have you know it’s that founding team do you have the right chemistry amongst the founding team that Julia, Rinoa and I you know we’re lucky that we’d come together and things worked making sure that there’s complementary expertise that there’s good chemistry and in balance that there’s great trust and you can divide and conquer in your own way and that you can each go out there
27:08 And have an impact. I like building startups in more of a bootstrapping fashion. I’m not a fan of going out and raising a lot of money initially. I like to prove a market and especially with the market and with the You know, the kind of world, the way it’s evolved, that you have so much open source software available, you have so many resources available to help get a company started into orbit without a lot of capital, that’s really kind of the test is you should be able to get a product live, get customers, even perhaps get to revenue, and each one of those steps reduces the risk to business success.
27:54 Colin Pyle: Is it hard to find talent in San Francisco when you’re like, I need to hire 10 people? I don’t know what the job market’s like. Is it nearly impossible? And if you can find people, is it about the money, is it about the stock options, or is it about the vision? There’s slides.
28:07 Kevin Hartz: Slides in the offices. It’s very challenging in San Francisco, and like we often use the analogy of customer acquisition in, you know, on the marketing side that you need to find unique channels to discover great people that you can’t use the typical channels, the kind of great example is that people used to just find an engineer on Craigslist or post to Craigslist. That’s played out. That’s arbitrage is gone. So how do you reach out and find talent around the world or pull from universities or acquires or, you know, how do you go about approaching, finding great talent, retaining great talent is as important as finding customers and making those customers happy.
29:03 Building a great company, having those people in place builds a timeless company that any product you build or launch will be successful with those right people.
29:11 Colin Pyle: Europe, when you look at Europe from where you’re based in California, is it, is it, And when other people like your peers in San Francisco look at Europe, is it like really hard to get your head around all the languages and all the different markets we got Germany you have to be in, but you have to be there in German and England seems kind of easier because it’s the same language. Does it look like a mess to you or does it just look like a wonderful opportunity to kind of test your product and find different ways of doing it better?
29:37 Kevin Hartz: We’ve been looking at it for a number of years now and so I would say we’re still in the early stages of understanding, but we’ve come quite far. A lot of our investors, Tiger Global is one of our investors that really focuses, has an international focus, Sequoia Capital has a global focus, and that’s been helpful to get that perspective that the internet industry is not just about Silicon Valley and winning the United States that used to be the old paradigm ten years ago is that you had a win domestically and you know nearly from day one you’ve got to think globally and the UK market um… Ireland uh… we’ve just really launched in Ireland recently and seeing great growth there uh… and then now pushing into the the continent um… really amazing markets and ones that we have to uh… appreciate and grow you know on their own with their own leadership
30:39 Brian Rose: Would you ever move to London?
30:41 Kevin Hartz: I spent a year in graduate school outside of London.
30:44 Brian Rose: That was strange. You went to Stanford, and then you went to Oxford for a history degree. That’s right. That’s quite a…
30:51 Kevin Hartz: Not so apropos for technology, one would think. But I would say the key component of history is that you see these patterns that happen over and over again, and we see these patterns in tech happening over and over again. So that’s maybe my one tie to how history is actually applicable. Otherwise, the period of Georgia 3rd doesn’t hold a lot of weight in the Valley, expertise in that area. So it has been useful, that history degree.
31:23 I would say that the intellectual curiosity and pattern recognition are really what I took away from Oxford.
31:31 Colin Pyle: Speaking of history, I mean, we’ve seen big bull markets in tech, and we’ve seen them recede whatever you want to call those things. We’ve seen a recent variable market. We’ve seen these Uber valuations, which are very impressive or crazy, whatever you want to call it, raising nine figures for Uber at $17 billion valuations. Do you see patterns here?
31:56 I mean, you’ve been in the valet for a while. You probably saw the 2001, 2002, and you’ve seen it again. Does this feel different? Does it feel like a slower growth, a sustainable growth, or do you still say, I can pick two out of these ten companies that are not going to be here in five years?
32:11 Kevin Hartz: Well, you know, I think you answered the question.
32:14 There are these really clear patterns that happen. We saw in 2000, you know, we see these pendulum shifts, and you describe it as the pendulum of capitalism never stays still in the middle. it’s either boom, it swings out one direction or bust and swings the other. You know, we’re a little bit out on the boom side but you can never really tell how far it goes or how long it lasts. We’re in a, there seems to be a fair amount of health.
32:47 I mean, despite, you know, we’re seeing some big valuations and so on and, but you’re also seeing some remarkable numbers and some remarkable economics out of these companies that I’m not going to say this is different from last time. As soon as, that’s the most dangerous line I’ve ever heard. And, you know, we heard that in 2008. We’re hearing it now and usually as soon as you start to hear people saying it’s different this time, it means the end is near.
33:19 But, you know, what’s wonderful is that there is a greater capital efficiency to the businesses being built. I love studying and really looking at these marketplace businesses. Uber, Airbnb, Eventbrite is a marketplace of buyers and sellers, attendees and organizers. Our center of gravity has been really focused around the organizers and where we’re shifting and spending our focus now is around the attendees and consumers and filling that vision of finding great things to do.
33:54 Kevin Hartz: I dodged your question a bit about whether we’re in a bubble. How did I get away with that? I don’t know, but I… I shifted it right back to… I expected nothing less.
34:03 Colin Pyle: When I think about the pendulum, because I’ve spent a lot of time travelling, especially China and India, almost two billion people, right? But it’s like, I think the pendulum’s swinging, but also the pendulum itself is getting bigger and bigger and bigger. So I think you can see all these massive valuations, and I don’t think they’re as crazy as people think because a billion people are going to come online in the next X years and I think really Asia and India some few companies from the West have actually really tapped, right?
34:30 You said you’re just scratching the surface in Asia, which is you know, a good chunk of the world And it’s just so I think when you look at valuations, it’s like can this team Tackle Asia can this team, you know do something in China and India and if that answer is yes And a lot of these valuations I think actually makes sense and you look at the numbers I mean like everyone’s saying if you look at the numbers that were leaked about uber I mean this is real money changing hands between that It’s like diversified revenue streams and cities all around the world between all these different users same with Airbnb I’m guessing the same with event, right? So it’s like it’s hard to necessarily ignore these kind of numbers is were you alluding to that?
35:16 Kevin Hartz: I Am and I I think there are some real businesses, you know, they’re of course in in all the excitement and and some businesses that either get funded too early or maybe didn’t have the sustainability end up kind of caught up and trapped in these over-funding situations or over-expanding.
35:33 And so you want to see a healthy pruning of the industry. And the NASDAQ went through that a couple months ago. There are a number of companies that really they’ve lost a tremendous amount of their value. But the best companies, we know over time there tends to be this consolidation and a few winners in each and usually one winner in each category exist and it looks like that’ll be the Uber
36:07 In that space, the Airbnb, I’m of course biased here. But that’s how markets operate. So it’s good to see a bit of that coming off and pruning, that kind of thing.
36:18 Brian Rose: Is it true you have a pets.com stuffed animal in your office?
36:22 Kevin Hartz: Wow, that’s exactly right.
36:24 Kevin Hartz: I do. And that’s the reminder. That’s, you know, thou art mortal is not to get too overconfident and I look at that pets.com sock puppet, which became the kind of, what do you call it, the metaphor for the craziness of the late 90s.
36:43 Brian Rose: Were you involved in that company at all, or you just keep it around?
36:48 Kevin Hartz: I wasn’t.
36:49 I had an office down the street, or actually I lived down the street from the pets.com office and always that was like the sign of the times there, but I keep that sock puppet on my desk to remind me that not to get too ahead of ourselves, not to get too overconfident to really think about building a great business.
37:10 Brian Rose: Apparently, your wife has tried to throw it away a few times, and you won’t let her.
37:16 Kevin Hartz: Absolutely not.
37:17 Colin Pyle: I remember that mania. I was in 99 at a dot-com startup, it was an e-commerce one, and I remember the different iterations of pets.com, there were four or five that were selling all those supplies, and I guess it is, it is the epitome of that bubble.
37:34 The question at that time for that industry of pet e-commerce companies was whether you shipped dog food or not because dog food was so you know the shipping cost you know that that was the great question and then of course Amazon I think is has solved that in one way or another right do you watch the television show Silicon Valley and is it accurate
37:54 Kevin Hartz: I have not seen it yet I’m a little obsessed with
37:57 Brian Rose: yes I really want to see it I you know there’s so much buzz around it and I’ve not gotten around I think it’s as HBO released it to iTunes yet I should know that because because I watched it legally so I don’t know there’s been eight shows in the series I’m not sure if they have released it I was pretty impressed it’s it on Netflix or no I don’t know it’s not on Netflix it’s you know HBO and Netflix or warring and we’re not HBO subscribers so you know I have to find it digitally and if it’s not available digitally yeah why would you I’m always just trying to get a feel for what you know that what San Francisco’s like and and what the feeling is there and and whether you know it is madness and mania around the tech or is I know there’s been a lot of criticism as far as the normal everyday person in San Francisco versus the the tech kind of person is it feel like a two-class system people used to say in New York City in the 90s where I lived that if you weren’t in banking you were a second-class citizen and it were probably right I was
38:58 In banking at the time but is that the case in San Francisco is it that much of a divide or is it overblown?
39:06 Kevin Hartz: Well, it’s really a renaissance period in San Francisco and we hope that the rising tide raises all boats and that you see this flourishing businesses that are part of the ecosystem of tech growing, all the different retailers, the different service providers, You know, the city, the real estate, the city’s undergoing this wonderful renaissance. However, to the flip side of it, you know, it’s just, it’s not a simple equation.
39:39 It’s the rents are astronomical. The, you know, there is a fair amount of unhealthy materialism, in my opinion. And, you know, and I think that the Valley does need to think about the other side of the equation, and that’s the simple fact of it. In any of these great periods of prosperity, these types of divisions occur, and, you know, we’re right in the midst of trying to contend with it in what you see are these, you know, issues or powder takes arise around attacking buses and things like that.
40:24 Colin Pyle: What have you seen in London this week that it impresses you? Has there been any kind of sector or companies or anything that you’re like, oh, it’s interesting to see what these people are doing? Because in a weird way, you kind of put these people in a different time zone, eight time zones away, and they’re obviously gonna come up with slightly different things than people in New York or San Francisco. I was wondering if anything kind of stuck in your mind.
40:43 Kevin Hartz: Well, it’s, you know, as I’ve traveled around the city, I’ve just gone from startup to startup and going into these offices and seeing 15 companies on the placard of cool startups and sitting down with these entrepreneurs and speaking to them and seeing the sophistication, the intelligence, the drive, the things that you wanna see in a growing tech community. Now, Silicon Valley has had decades headstart. We had many, many decades, actually. The chip industry, Hewlett-Packard, the military influence and impact that spawned the chip industry, which spawned the hardware industry, which spawned the software industry.
41:34 So there’s been a lot of time for what’s happening in the last two decades to actually develop. And so I think that London is on its way. It’s falling more of a course of, I would say, New York. We’re seeing a lot of promise and excitement coming out of New York. So it’s falling more of that, whereas if I think about the exciting things that are happening in India, in China, you have a lot of Indians, a lot of Chinese going back to India and China to start companies.
42:10 And that’s because there’s self-contained markets and they’re so enormous, you know, the Alibaba’s and Flipkart’s and so on of the world. And they’re just great opportunities back there. London is different and I would put it more akin to New York if I try to make that comparison.
42:29 Brian Rose: All right, that’s a good comparison. Can you spot a successful entrepreneur in five minutes?
42:35 If you sit down and talk to someone, you said you’ve been going through these companies.
42:42 Kevin Hartz: Um, you know, I think it’s the, well, I mean, I, sometimes I guess that’s, that’s my cop out. And I think, uh, just enough, um, you know, I can certainly, um, I, I certainly look for certain characteristics and I actually like to learn a lot about, um, family, family history background. Um, like I like to hear the obstacles that entrepreneurs have overcome. And so like I almost like run a psychological profile on entrepreneurs to say what is their true motivation, how were they influenced by their family and their parents, as it really tells me a lot about an entrepreneur and their true motivations.
43:31 But I’ve certainly made my fair share of mistakes. I think that you mentioned all those great companies that I had the good fortune to be involved in, but I think a great investor is just somebody that’s managed to push aside or convince everyone to forget about all the disasters he or she has been involved in.
43:50 Brian Rose: That’s good advice. How do you get involved on the ground floor with those companies like PayPal, Airbnb, Pinterest, or is there another 97 in your portfolio that didn’t do very well?
44:01 Is that because people you knew or you believed in their business models? How did that happen?
44:08 Kevin Hartz: Well, it was a fledgling time in the Valley that I was really out there. And you can see that in London today is that it was a special movement that was happening. And there weren’t 15 or 20 Airbnbs.
44:24 There was just one. There weren’t 15 or 20 Trulia’s. There was one PayPal. And it was a relatively small network. And I was an entrepreneur, and what I found is that I was just drawn to learning.
44:44 Part of really the context or really the main thrust of Eventbrite, we value transparency, we value collaboration, and we value learning. And I could learn a lot of the early stages by spending time with these great entrepreneurs. And so they were investments that I was supposed to be advising and helping, but in fact, I was gaining as much information the other way. And that’s really what the core is of what it takes to build a collaborative, fledgling industry.
45:18 And that’s what needs to really happen with entrepreneurs in London. And that’s what’s heartening to see when entrepreneurs are all housed together and sharing problems. We talk a lot about open source software, but we should talk about open-source sharing of knowledge. And that’s what was helpful was these formative years of being able to interact with all these great entrepreneurs.
45:40 Colin Pyle: That is probably the best statement you’ve made so far.
45:43 It’s just the most interesting. It feels like a really open community here. I don’t really have anything to compare it to, but I haven’t heard of anyone trying to hide an idea or hide knowledge. Everybody is more than happy to give introductions and they’ve taught me to be the same. And it’s just like, let’s help, help, help, help.
45:58 We still feel like a movement that’s foreign to this city. We’re not in government, we’re not in banking, we’re not, you know, in advertising. I kind of span the tech world and then with my coffee business, the old traditional product business. And I see it enormous gaps, right? Like the lack of transparency and the shadiness that exists and sort of the coffee industry of sort of the moving products is incredible.
46:24 And the hesitancy to give introductions and-
46:27 Kevin Hartz: Yeah, exactly.
46:27 Colin Pyle: I’m trying to take the tech world and be transparent and open and then guys are screwing me over, and I’m like, what the fuck, man? I’m trying to pull, you know, be tech here with you, and you just, you didn’t play tech, and that’s not fair.
46:42 Kevin Hartz: It occasionally happens in tech, but it’s harder to do because, you know, it’s an open, transparent community, and you don’t, you know, if you act as a bad character, the reputation sticks with that entrepreneur for a long time, investors as well.
46:56 Brian Rose: Yeah, and it’s not just the bad relationship you have of the person, it’s like everyone sees your behavior, like a true monkey clan, and you get punished for it. Kevin, we always ask everyone here a few questions at the end, I wanna ask you the same, if you could make a phone call to the 20 year old, Kevin Hartz, and give that young man a bit of advice, what would you tell him to do?
47:18 Kevin Hartz: Well, my advice to any 20 year old or fledgling entrepreneur is to not listen to their parents.
47:24 And what that means, I like to give my parents a hard time and tease them, so that’s why I like to say that for one. But secondly, the truth of it is that our parents, or the status quo, is not thinking about what the future looks like. One is thinking about what the past looked like, what success looked like in the past, and that was being an investment banker, being a consultant, or taking a risk adverse route route to so-called you know success or happiness and the reality is that you have to take extreme risk and especially at age of 20 it’s a time to you know take some risks really try to make an impact on the world and do something really incredible and that’s what we wake up every day that’s what motivates me is and so thinking big taking big risks really go for it going for it is is that phone call to that 20-year-old.
48:26 Brian Rose: And that 20-year-old being you, were you taking those risks at that point?
48:31 Kevin Hartz: I think I was, I think I zigzagged a bit and, but no, I could have, I certainly could have been thinking bigger, was certainly not on any track of a Mark Zuckerberg. I would call myself a late bloomer having started my first company in my mid-late twenties.
48:49 Colin Pyle: And when you were at Oxford, you weren’t thinking, I’m just gonna get back to tech pretty soon here. I’m going into tech.
48:57 Kevin Hartz: I was thinking graduate school, more graduate school or you know, who knows what.
49:03 Brian Rose: On that same line, best advice you’ve ever received, business or personal over the course of your career?
49:11 Kevin Hartz: Best advice I’ve ever received. Surround yourself by great people. It’s something often heard, but really just not compromising on the quality of the team that you’re gonna build around you.
49:25 And at the same point, finding great mentors to get advice. If your startup out there, startup here in London, it’s hard to hire employees or you may not have the capital to do it, but you can find great mentors and people to learn and get advice from.
49:41 Colin Pyle: Excellent. Last bit of that, you mentioned to the 20-year-olds advice and things like that, if they do want to get into tech and they’re not located in a major metropolitan area where they can maybe drop by for a drink about it, that kind of thing, what should they do?
49:58 Should they try to build something? Is there any key thing that they can do if they want to get into the industry?
50:07 Kevin Hartz: It’s incredible the body of knowledge available and resources available such as this show that anyone from around the world can listen in and gain hopefully some insights, you know, whether then it’s also you can learn to code online, you can take classes from MIT on computer science, so there’s so much that can be done now and, you know, really listening, learning and just making that jump of, you know, there’s always the opportunity in the 20s to make a lot of mistakes, and if it’s an interest and a passion, go for it.
50:47 The downside, or the thing to be cautious of, is just make sure, I think that technology can be somewhat fashionable, and it comes and goes sometimes, and entrepreneurs can get into it for the wrong reasons, can get into it for the, they see piles of money, or it seems to be the invoke thing to do. And really what entrepreneurialism is about is making an impact on the world in a positive way. And if you see that as your true north then follow it.
51:20 Brian Rose: Very well said, take some risks.
51:22 That’s good advice for the 20 year old. Good.
51:25 Colin Pyle: I have one more, you have such a unique background for payments, do you know what I mean? I think I wanna hear your opinion Where are payments going? Is Bitcoin here to stay? Maybe share shed some light on some of that stuff
51:40 Kevin Hartz: well, I’m biased again, I’m I’m long in Bitcoin and You know have did get involved in payments early on as you know A spectator on the sidelines of watching PayPal grow and that great team do amazing things as that company was started and then of course zoom and and now Eventbrite is very payments heavy.
52:01 So looking very carefully at the world of payments and certainly watching Bitcoin, I think that, you know, I think optionality is important. So by that, I mean that, you know, I believe that Bitcoin has that opportunity to be the TCP IP of money, meaning to be this new form of currency that becomes ubiquitous, but there’s also a lot of risk to it. And so you don’t want to necessarily put all your eggs in one basket. So that’s the question is, and that’s the question of the challenges of Eventbrite every day, is there are things that can disrupt or propel Eventbrite to the next level.
52:45 Google Search, organic search was one of those things that propelled us to the next level. Social and Facebook and Twitter was something that propelled us to the next level. The mobile revolution is now, and we have to decide, Will Bitcoin be that? Or will it end up being something forgotten of the past? And I’m long in Bitcoin, but I also can’t, I would say it’s a small part of my portfolio, so I’m hedging myself.
53:16 Colin Pyle: So keep your options open. Exactly. Yeah, I love Bitcoin, I’m fascinated by it. I’m not that long. I have a slightly small long position.
53:23 But I’m not convinced it’s gonna change this whole payment game in the next five years and maybe in the next 10, but that’s my opinion. Not that you even asked my opinion.
53:33 Brian Rose: That’s okay, I’m glad to hear it. Kevin, thanks so much for your time. Thank you.
53:38 Brian Rose: This was a great episode because we really got really in your head about a lot of things. So thanks for the insights. We’ve been doing this now a year, 52 episodes, and it’s great to kind of get the stories and especially someone that’s been in the industry as long as you just get your thoughts on there.
53:54 Kevin Hartz: Really a pleasure. Thank you, Brian.
53:56 Thank you, Colin.
53:57 Brian Rose: Yeah. Thanks for making the stop on your busy, busy week in London. Yeah. Well, if you’re listening to us on iTunes, you can watch us on YouTube.
54:04 And as we say, it’s at Silicon Real. It’s about the people. We’re one year in. We’re going to keep doing this.
54:09 Colin Pyle: Happy birthday.
54:10 Brian Rose: Thank you. Happy birthday to you, too. And yeah, if you want to help or get involved, send us an email, hello, at siliconreal.com. We got a couple of people that are working for us, getting involved, meeting all sorts of great people. And we always want to hear your suggestions for guests.
54:22 Colin Pyle: And there you go. Kevin, all the best in your journeys and with Eventbrite, big fan of what you’re doing and take care of yourself. Thanks so much.
54:31 Unidentified speaker: We have people pair up between some of the startups that we work with and some of the established people that we have within the business and it’s about sharing best practice and mind share and you know all of that sort of stuff and it really wraps off on them, it really wraps off on them in terms of some of the ideas that they can come back with and the different ways in which they approach challenges. If you’re going to grow, if you’re going to be successful you need to take risks.
54:59 When you get that call, when you get that opportunity, just go for it, don’t worry. Consistently push yourself outside the boundaries. There’s a world of possibilities out there, so I think it’s a really exciting time.
