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How a spare server turned into Twitpic, the $1.5M+ a year startup
- alexro 17y ago2010 turns out to start full of good news about small teams. First Balsamiq story, now this one. Anticipated is a new wave of optimistic first-time entrepreneurs with financial projections built on these cases :)
- fizx 17y ago> Noah was recently offered 10 figures for the business Bullshit.
- noaheverett 17y agoYeah 10 figures is a typo. It's stated as 8 in the actual interview.
- rodyancy 17y agoThe real story is the Tulsa tech scene. First, the Ping.fm acquisition and now the Twitpic story. Tulsa FTW.
- callmeed 17y agoThat's awesome. I may move to Tulsa area later this year and I've been wondering about the tech/hacker scene. Anyone else?
- rodyancy 17y agoThat was a joke, really. The scene here is limited. There are a few of us working on interesting things. The problem is when they take off the founders tend to move, like the guys behind Ping and Noah. Anyway, when you do move look me up.
- callmeed 17y agoDang, I'm usually good at spotting jokes/sarcasm–my bad. I'll definitely look you up.
- sucuri2 17y agoIt certainly seems hard to believe...
- grannyg00se 17y agoWhat I found hard to believe was that if someone was offered more than $10M for something like that, they'd turn it down simply because it's fun to operate. Unless that person is already financially independant, I'm pretty sure they'd take the money.
- antidaily 17y ago8. andrew says "so at least 10 million". he counters "much more than 10 million".
- petercooper 17y agoAnd if he didn't take "much more than 10 million" for a site that's making about $1m in profit, he either has gigantic balls or a tiny brain :-) Good luck to him though!
- gridspy 17y agoI imagine that its profit in the next financial year will be more. Also, he isn't in it for the money. Would you walk away from a fun success?
- petercooper 17y agoIt depends. If it were powered by advertising, yes, yes, and yes. If it were customers paying money for goods or services, not if it were really fun. But I'm still at that pre-$5m net worth stage where having more than that would basically set me for life. If I were already wealthy, the rules would be totally different. At the moment I just want to hop that fence, then forget all about money (to a point).
- mikeryan 17y agoIt is - in the interview its 8 figures, 10+ million.
- icey 17y agoThere were a few times in this interview that my BS detectors went off. Andrew asked a question regarding which VCs Noah had spoken with and Noah said he couldn't respond due to NDA. After some probing the story changed to say that only some of the VCs required NDA at the point of discussing monetary figures. Andrew did a nice job by continuing to ask questions like "what did they want you to do with the money?" and Noah again vacillated. It just struck me as odd that he couldn't remember what the discussions were about, it seems like something that should be really easy to remember. Of course, he could have just been nervous as well, but it really smelled fishy to me. Disclaimer: I don't know Noah, I have never used TwitPic, I have nothing for or against Noah and / or TwitPic, so take all of this with an ENORMOUS grain of salt since this is nothing more than pure speculation
- noaheverett 17y agoNervous is an understatement...as you can see I almost failed speech class for a reason :)
- icey 17y agoThat's a good enough explanation for me; I hope you can see why I thought it was odd. I was about to delete my comment but saw that tannerburson had replied. Sooo... were the VCs interested in getting you to add manpower or spend money on marketing (or something else, like infrastructure)?
- noaheverett 17y agoYeah man power and infrastructure. The goal with VC usually is to help something move faster in the direction of success/profitability via whatever resources the startup is lacking in.
- tannerburson 17y agoI've met Noah on at least one occasion. He's a very nice, and very bright guy. But he is a completely accidental entrepreneur, so I'm not surprised at all that he struggled in an interview like this. In fact, this might be the first big real-time interview he's done. My reading of the situation tells me that he's just really uncomfortable talking about the conversations he's had with VCs, and doesn't know how to convey that without being awkward. That said I've never really understood his motivation for handling TwitPic the way that he does, but that's definitely not my place to criticise.
- jasonlbaptiste 17y agoit says somewhere 8 figures. thats a typo.
- AndrewWarner 17y agoOh man. Good catch. Typo. Complete mistake. I'll correct it. I was doing an interview and didn't see your comment till now.
- moe 17y agoThat whole story is just one big WTF to me. It seems most things sailing in the wake of twitter simply defy all logic and common sense. There have been literally dozens of picture sharing services before twitpic. The only difference I can see is the name ("look, we're for twitter!") and that he basically integrated an url-shortener. The entire site looks like about a week's worth of work. 700k in annual profit? Not sure if I want to laugh or cry.
- abstractbill 17y agoThe entire site looks like about a week's worth of work. 700k in annual profit? Not sure if I want to laugh or cry. Laugh. Be happy. Learn from this that you don't have to make something people want that nobody else could make because it's so complex and you're awesome. You just have to make something people want.
- axod 17y agoThe other takeaway for me is that it was an insanely risky bet. Twitter could easily have built the functionality to share pictures into twitter (Like facebook did). Heck - then they might have a reasonable revenue stream. If Twitter had done that, twitpic would have been stomped on.
- emmett 17y agoA very risky bet, with high payoff and low risk. AKA, a good bet. Chance of Success * Reward - Cost. Just because the chance of success is low doesn't mean it's a bad idea.
- aaronblohowiak 17y agoVery risky, yes. But it is chicken risk, not pig risk.
- abstractbill 17y agoRight, but if the entire site really was about a week's worth of work (or anything like that order of magnitude) then I wouldn't say this was insanely risky, I'd say "why the hell would I not try this?" ;)
- robryan 17y agoI would have sold, at any time twitter could basically undermine his business, actually the more successful it becomes the more likely twitter would be to integrate it.
- anApple 17y agoMy thought as well
- jfarmer 17y agoTo wit, Twitter switched the default URL shortener from tinyurl to bit.ly, and now bit.ly is the largest URL shortener on Twitter. This is what happens when your business is a commodity (and you're not the one who commoditized it).
- gsmaverick 17y agoTwitter is almost guaranteed not to go into photo sharing. They've had tons of opportunity to add in media services but they clearly aren't interested.
- deleted 17y ago[deleted]
- noaheverett 17y agoThanks for the comments everyone! I hope that you will find the information in the interview useful in some way. Feel free to hit me up on Twitter (@noaheverett) if you have any questions.
- brandnewlow 17y agoNoah, thanks for putting all this info out there. And congratulations on your success so far. Question: How did you respond to the leaked Twitter notes in which the Twitter guys talked about "blessing" another Twitter photosharing application instead of you? That had to be a low point. I remember when I first read that I clucked my tongue in sympathy for you. Do you suppose the Twitter guys would rather just work with a known quantity instead of some guy out in SC? http://www.techcrunch.com/2009/07/16/twitters-internal-strategy-laid-bare-to-be-the-pulse-of-the-planet/ http://www.techcrunch.com/2009/07/16/twitters-internal-strat... (ctrl+F for "twitpic" to find the relevant section)
- Skeuomorph 17y agoIs "O-off" a subtle dig at OAuth, or an audio transcription typo?
- rythie 17y agoTypo, it's fixed in the Etherpad version
- anApple 17y agoLucky guy. Twitter could have killed him in a glimpse by just offering an image/video storing site themselves.
- slig 17y agoYeah, right after building their own URL shortener.
- dusklight 17y agoQuestion for noah, if he's willing to answer it: You said that currently you have $1.5M+ revenues, and margins of 70%. What are the current cost breakdowns right now? Other than salary, what other ongoing costs do you have?
- ynniv 17y agoYou have to serve a lot of content to make $1.5M in advertising.
- sewerhorse 17y agowell i guess the cdn costs is trough the roof when the core functionality of your site is photo sharing.
- tennisman120 17y agoThis is just one of those pot-luck ideas. It was already out there, he just hit the jackpot.