I met Matt through my good friend Nick Ganju, cofounder of Zocdoc. In early 2016, when we were starting the subscription part of the business and trying to work through some logistic challenges, Nick said, “You should talk to Matt. He’s been through this.” We met and became quick friends. His input has been invaluable to our development of the Crate Club and Book Club programs.
A Minnesota boy, Matt looks every bit the part: mild mannered, soft spoken, typically dressed in plain jeans and plaid shirt. But don’t let that genial nature fool you: Matt is an animal (and, yes, pun intended) who has spent his whole career at the forefront of disruption and innovation.
Emerging from college in 1997, he was uninspired by the Fortune 500 companies showing up at the job fairs—but he was intrigued with the Internet. None of these companies were talking about that back then (or even thinking about it), so he went looking for an opening at a smaller company, as he says, “something where I could learn faster and get my hands a little dirtier.”
He found a digital ad agency in New York that was hiring young people who were hungry to learn. In 1997, the very concept of a digital ad agency was radical, and when Matt packed his bags and moved to New York, it was like crossing the continent in a covered wagon and stumbling upon giant redwoods and the Pacific Ocean. The company, i-traffic, played with all sorts of unlikely concepts like pay-per-click that today are taken for granted. Matt and his colleagues created the first banner ad. (“So, yeah,” he says. “We’re the ones to blame for that.”) They also helped introduce clients like Disney, Staples, Capital One, and Discover card to the untapped horizons of the Internet, helping them get online and learn how to navigate their presence on this unknown space called the World Wide Web.
After two years, the company was sold to a large, traditional agency, and Matt decided to hit the bricks. For the next few years, he worked on an idea for a handheld communication device built into a credit card—prescient stuff back in those pre-smart-phone days when texting wasn’t yet a thing. He and his business partner burned through $15 million without releasing a single product. Matt says he learned some critical lessons in that failed venture that would serve him well later. (More on that shortly.)
His next business idea was triggered, in a way, by the events of 9/11. He and a friend, Scott Heiferman, were struck by the feeling of community in New York City in the days after the attacks. People were talking to each other, meeting up in coffee shops, showing genuine concern for one another. Inspired by what they saw, Matt and Scott started asking themselves, “How could we create that more permanently, and all around the world?”
That question led them to start Meetup.com, an online portal dedicated to helping people find and meet other people who share common interests. They formed the company in January 2002 and launched the site that June.
Meetup was a phenomenal success, in terms of its growth and popularity, but it also offered a years-long laboratory in the challenge of how to monetize a digital business (a challenge we would grapple with a decade later at Hurricane Group). For the first few years, they tried various business models, but nothing stuck.
In April 2005, after three years in the business, Matt was touring the country to meet members and organizers and listen to their product requests. At a meeting in Atlanta, a woman stood up and said, “I’m so glad you’re here. I joined the Atlanta Breast Cancer Survivors Meetup four months ago. I’ve been struggling to recover and was really looking forward to this group meeting—but it’s been four months, and so far there hasn’t been a single event. I’m starting to lose hope.”
Her story hit Matt hard. This was a problem they’d been wrestling with for a while now. Because anyone could start a Meetup group for free, they had tons of people starting groups and then doing nothing with them. All these groups lying dormant with members piled into them and nothing happening was creating bad experiences for people.
EBay founder Pierre Omidyar, who was on their board of advisers, had told them they needed to start charging their organizers a fee. “Most people who get to start a group for free won’t take it seriously,” he said. “This is a privilege you’re offering them. You’ve invested a lot in this platform. You’re providing value here. You need to charge.”
For months, they had resisted his advice, but the woman in Atlanta added a whole new dimension to the issue. “This wasn’t about Pokémon cards or knitting,” says Matt. “This woman had her life hanging here by a thread, she was counting on this group—and someone had just started it and walked away.”
That’s when they decided Omidyar was right: they needed their people to have some skin in the game. They announced that they were going to start charging a monthly fee to host a Meetup group.
All hell broke loose. People screamed at them, flamed them, said they’d been betrayed, kicked and yelled, told them they were going to be out of business in no time. “They said just about every awful thing someone could say to you,” says Matt.
Pierre had predicted that they would lose 85 percent of their user base, and he was close: they lost about 80 percent. “It was terrifying,” says Matt.
It took about a month to go through the storm and emerge out the other side, but emerge they did. Not only did the new fee structure stabilize things and greatly increase user satisfaction, it also turned out to be a revenue model that made sense, and it’s worked for them ever since. By 2008, the company was showing a profit, and it’s still growing today.
After leaving Meetup in 2008 (“I felt like I’d done what I set out to do there”), Matt created a few more start-ups and had more or less settled down into an advisory role when he quite unexpectedly got bitten once more by the entrepreneurial bug.
He never planned to start Bark & Co. In fact, he resisted the idea. But he couldn’t help it: he had a great idea. Or really, it was more like the idea had him. “I had no choice,” he says. “It just dragged me in.” (Think Al Pacino in The Godfather: Part II, only in corduroys.)
Matt had a dog he loved to spoil, a 130-pound Great Dane named Hugo. He was having a hard time finding new products for Hugo, so one day in the fall of 2011 he came up with this idea: a monthly box filled with treats and cool toys for dogs.
“It wasn’t meant to be a big idea,” he says. “It was just a side project, a little experiment to set up and watch, and make my dog happy along the way.”
He told a friend, Henrik Werdelin, about the idea and Henrik sketched up a mock home page, which Matt set as his cell phone home screen. He started showing it to friends to see what they thought. People said, “Hey, that’s great—I have a dog, so let me know when it’s live, and I’ll sign up!” After a few weeks of this, Matt attached a Square credit card reader to his phone and started taking orders—for a product that didn’t exist, for a company that didn’t yet exist either. By December, he had forty-nine paying customers eager to start their subscriptions.
The holidays were just around the corner. Matt and Henrik figured they better come up with something soon to satisfy those people who’d voiced their interest and put up their credit cards, so they hastily assembled some items into some boxes and shipped off forty-nine packages.
They’ve shipped every month since.
By the end of the first year, they’d gone from those first 49 to about 10,000 customers. By the end of year two, it was 60,000, and it kept growing. By the end of 2015, they were at about 225,000 monthly shipments, and in 2016 they doubled that to about 450,000. By the time this book is in the stores, they’ll be at well over half a million BarkBox customers.
In March 2014, Forbes named BarkBox No. 4 on its list of “20 Companies You Should Be Following on Social Media”—a list that included TED Talks, SpaceX, Starbucks, and Zappos. Not too shabby.
Even as their core concept, the BarkBox, has continued to grow like crazy, Matt and his partners have continued spinning off new idea after new idea. Just as I’ve found with our Web sites, some of those ideas stick and some don’t. The BarkPost, a blog about dogs (sort of a dog-themed BuzzFeed), and BarkShop, a retail portal for pet-related products, are both alive and thriving as I write this. BarkCare, a virtual veterinary referral service complete with twenty-four-hour hotline for dog questions and emergencies (and even house calls), didn’t make the cut, and they had to shutter it after a year.
All grist for the entrepreneurial mill.
Right now they’re working on BarkAir, an ambitious plan to provide a door-to-door travel experience, partnering with ride-sharing companies, hotels, and airlines. The week we held our interview, they were doing a trial flight from New York to Boston with a complement of dogs.
Which brings me to the point of Mr. Meeker’s Wild Ride and the critical lessons Matt says he’s learned along the way. The success of Bark, especially as placed side by side with the colossal failure of that early tech company that never shipped a product, has shown Matt three keys to staying out ahead of the curve and doing so successfully:
Matt had access to the wisdom of Pierre Omidyar, one of the most successful digital entrepreneurs of his generation—but it was contact with that woman in Atlanta who drove the wisdom home. And it was customer response, even before they’d shipped a product, that told Matt and Henrik they had a viable business.
“Which is difficult,” says Matt. “As a perfectionist, it’s tough to let go, to let other people take your thing and run with it. But there’s tremendous power in that, too.”
I thought I should close this chapter by telling you how we did in getting out of that 2014 slump.
I brought Ben on at the beginning of 2015, and we immediately did some housecleaning and restructuring. I also decided it was time to stop this commuting silliness and put myself in the belly of the beast, so I secured a small rental in the heart of Manhattan and relocated from California and Nevada to New York City and San Juan, Puerto Rico (for the tax advantages and fantastic climate). During 2015, Ben and I put together an advisory board of outstanding businesspeople from a wide range of fields whom we could tap to help us with our thinking: people like Betsy Morgan, Kamal Ravikant, and Matt Meeker. In November, we held that strategy meeting where we decided to create our own box-subscription program. We launched the Crate Club in January 2016 and the SOFREP Book Club a few months later. In January 2016, we also made a huge jump in the volume of our content on SOFREP, increasing from three or four posts a day to twenty or more as a tactic to increase traffic to the site. This also had the effect of cementing us as a solid source for news and current events.
We finished 2015 at about $1.5 million in top-line revenue. In 2016, we had already sailed past the million mark by April; we closed out the year at $4.5 million and will grow to almost ten times that in 2017—with fewer than sixteen people on the team.
Here’s what happened, in a nutshell: I stopped being simply busy and started being effective again. I got back to leading with a clear vision—and leading from the front.