Note:

We wrapped up the Mobile Growth Lab where over 60 marketers, executives, product managers and developers signed up to break the shackles of ATT’s performance and measurement losses. You can get access to the recorded versions of these sessions through our self-serve plan.

Check it out here: https://mobilegrowthlab.com/

ABOUT SELINA: LinkedIn | Evite | Gixo

ABOUT ROCKETSHIP HQ: Website | LinkedIn  | Twitter | YouTube

KEY HIGHLIGHTS

☂️ The first internet boom

👔 Growing the Evite business in the beginning

🎓 How did the team understand the scope of the business

🪴 Monetizing Evite

☄️ The effects of the dot com bust

🌈 The experience at SurveyMonkey

☕️ How SurveyMonkey handled international expansion

🤿 Pioneering the freemium model at SurveyMonkey

🤸‍♂️ The beginnings of Gixo

🎭 Why live coaches work better than recorded sessions

KEY QUOTES

What made Evite stand out

One of the things I would say that we did really well at Evite was really looking at the metrics and looking at that virality, which is how many people you invited and how many of them in turn became creators themselves. There was tons of competition at the time, there was Invite Me 2, Time There, See You There. I truly believe one of the reasons that we went above the crowd was because we were very focused on AB testing and constantly iterating to improve that viral coefficient. So even though we didn’t call it a viral coefficient, at the time, it was always how many invitees will become creators. That was a number we looked at. That was one of the main reasons I think we were able to sort of, be alive today.

Surviving the dot com Bust

That wasn’t very fun. We had taken $37 million in funding for online invitations. We were not as focused on revenue as we should have been.  We took out billboards because that’s what people did. We were in a position where to get the investor value back, the best thing we could do was sell the business. We did something very unusual – if I remember correctly, we took an ad out on the Wall Street Journal, saying, “Evite’s For Sale” We ended up with two bidders. 

Early beginings at SurveyMonkey

Survey Monkey was a very amazing business.  Ryan Finley, the founder, started the company in 1999. If you ask me, I think he’s the person who sort of invented the freemium model or one of the earliest people to do the freemium model.

Lifechanging transitions

So I sent him a note and negotiated my package. I told him that I was an executive in Europe, so I had to give at least three months’ notice. And I said to number three, I’ve early signs of pregnancy. Dave responded within minutes, and said he was determined to build a company that could support families, but also build a massive business, and that building the right culture, while also being profitable was very important to him. I got that email and I said, this is the guy I want to work for.  So I started a new job across the continent, across a different country, four and a half months pregnant.

What defines a healthy company culture

 On the culture side, specifically, the thing that I learned and appreciated the most from Dave is that a lot of people talk about culture, a lot of people put their values on a wall, and then you know, write it up and tout them, but Dave was not focused on that. He wasn’t focused on making sure that we had them sprinkled everywhere, he was focused on figuring out the culture and the values that we actually wanted to live by and how you took policies underneath that, to make sure. 

Lessons from failed tests

So every month, we would stand up there in front of the whole company and talk about our metrics. But we would always talk about some AB tests that didn’t work. Dave was a guy who loved to bet and we would always place bets in the AB tests. Sometimes he was wrong, sometimes I was wrong, sometimes our head of growth was wrong. 

The importance of a properly worded survey

One of the biggest things I learned about surveys that surprised me was how you can easily bias people with questions. I never really thought about that. If you ask people if they agree or disagree, most people in the US are going to agree with something because it feels nicer to agree with something than to disagree with something. 

FULL TRANSCRIPT BELOW

FULL TRANSCRIPT

Shamanth Rao  

Selina, I’m very excited to have you here. 

Selina Tobaccowala 

Thanks for having me.

Shamanth Rao 

Absolutely. I would love to start at the beginning. You graduated in the middle of the first internet boom. What was it like at the time?

Selina Tobaccowala

It was a very exciting time. There were tons of companies that were just starting. You had Yahoo, Excite, pets.com. I graduated from Stanford in computer science, there were tons of companies that were growing and innovating. so it was just a very exciting time in history.

Shamanth Rao 

You graduated in computer science at the time and yet you did not attend a career fair. Why did you not attend a career fair?

Selina Tobaccowala

I always remember this story very vividly. I was standing outside in the hallway of our office, we had actually started our company in 1997. We had a very different idea about Evite at the time. It was an object oriented template language. So it was a terrible idea that had no product market fit. But we were really excited about it. 

I remember that this career fair came along, and I was like, “Okay, should I go?” And so I went into the hallway, and I called my dad. And my dad said to me three things. He said, first of all, do you love working without? And I was like, absolutely that’s obviously proven true. 

The second thing he said to me is,  “Are you learning?” and I said yes, I’m learning so much. 

We’re starting a company from scratch. 

The third piece of it was, “Are you excited about the product and the mission of what you’re building?” and we were. We were excited about what we were building, even though it had no product market fit. Those three things, people, product and learning have really guided me through my entire career in terms of every career decision I’ve made.

Shamanth Rao 

So much of that advice is timeless. But having had Indian parents myself, I would also point out that it’s not very common for most Indian parents to encourage their kids to take risks, or to become entrepreneurs. What would you attribute your dad’s encouragement to?

Selina Tobaccowala

I think it was a couple of factors. First of all, I do think many of our parents, especially those that immigrated here from India took a big risk. It is a huge risk to pick up your life and move across the world. I think by nature, that proves my parents and many of our parents were risk takers. Additionally, my dad took the more conservative path for a while. He stayed at ETS for more than 20 years. He saw many of his colleagues go and start companies and just saw them both enjoy it, as well as the risk versus reward profile. My dad himself then went to startups. And so I think it was something that not only was he encouraging me to do, but he was doing himself. So it was pretty validating.

Shamanth Rao

So he walked the talk himself. And that gave him the conviction to encourage you and back you. When you started Evite, what were some of the first things you did to grow the business?

Selina Tobaccowala

I would love to say that we were very planned and thoughtful about it, but really, the thing with Evite is that it did have a natural viral coefficient, in the sense that in order for somebody to use the product, they had to invite more people and bring them into the fold. 

When we started, we were surprised by how quickly it was growing. I tell this story, that I’m very clumsy and we had this server underneath our desk, and I actually tripped over the cable of the server that had Evite on it.  At the time, we were building multiple products, and we were consulting to try to pay our bills. And our phone rang, and somebody said, “What happened to Evite?” We plugged it back in and we were surprised at how well it had grown. I would love to say it was super intentional when we started and it wasn’t. Then we got more thoughtful about how we can continue to increase that viral coefficient.

Shamanth Rao

At the time, the word virality wasn’t quite in the business lexicon in the way that it has come to be since Facebook ads and social media. So what about what was happening, led you to recognize that this was an opportunity to build a business?

Selina Tobaccowala

It wasn’t just something Al and I realized on our own. We had advisors like my dad, but also we partnered up with Josh Silverman, who was our CEO at Evite. He had come from Stanford Business School and had more business experience than us. And he helped us also see the fact that it was a good business opportunity.  

One of the things I would say that we did really well at Evite was really looking at the metrics and looking at that virality, which is how many people you invited and how many of them in turn became creators themselves. There was tons of competition at the time, there was Invite Me 2, Time There, See You There. I truly believe one of the reasons that we went above the crowd was because we were very focused on AB testing and constantly iterating to improve that viral coefficient. 

So even though we didn’t call it a viral coefficient, at the time, it was always how many invitees will become creators. That was a number we looked at. That was one of the main reasons I think we were able to sort of, be alive today.

Selina Tobaccowala 

Did you think about monetizing Evite at the time?

Selina Tobaccowala 

We were very early. At the time, investors were all talking about eyeballs. How many eyeballs can you get on your site? And it was all about getting pageviews, which is obviously very funny today and not focused on revenue.  Another thing we did was, pretty early on, we were actually focused on trying to create some monetization through advertising. And we had a gentleman who was our head of sales, Jim Benton, and he went out and really sold some very big brands. We had Pampers, who sponsored our baby shower channel. I still remember it was Finlandia Vodka that sponsored our happy hours. He got these really strong brands to basically sponsor an event category. That was another reason I do believe we were able to sell the company when the dot com bust, because we really had some good advertising brands that IAC was excited about.

Shamanth Rao

Not only did you have advertising revenue, but I also thought you guys had a very sophisticated social graph for your time. You had profiles, you had feeds, you had photos, and you had a lot of data about the social behavior of your users.

Selina Tobaccowala

If you think about it, we obviously missed an opportunity. We probably at the time had the largest social graph in 2000-2001, way before any of the social networks.

Shamanth Rao 

Sounds like you guys were way ahead of the time because Facebook came way after you guys. You guys did go through the dot com bust, what was that like?

Selina Tobaccowala

That wasn’t very fun. We had taken $37 million in funding for online invitations. We were not as focused on revenue as we should have been.  We took out billboards because that’s what people did. We were in a position where to get the investor value back, the best thing we could do was sell the business. We did something very unusual – if I remember correctly, we took an ad out on the Wall Street Journal, saying, “Evite’s For Sale” We ended up with two bidders. 

In April of 2001, we sold to ISC. Ticketmaster City Search was the main entity buying us at the time.  It worked out really well because, for us, we had invested so much in the product and invested so much in the brand and to see that brand still alive today makes me really proud.

Shamanth Rao

Absolutely. 20 years is a lifetime.

So if we were to fast forward to 2009, you were in Europe at the time, because you had moved to Europe after selling Evite. You had been thinking about moving back to Silicon Valley. What were some of the options that you were evaluating at the time?

Selina Tobaccowala 

I was living abroad, working for Ticketmaster, which was a wonderful experience but I was traveling about 60 to 70% of the time, and my husband and I wanted to start a family. I knew I couldn’t travel so much. And I was very excited to get back to Silicon Valley and come to something more innovative. I looked at a whole bunch of different options. I looked at, really early-stage companies, I looked at slightly larger companies. But really, when I met Dave and heard the Survey Monkey mission and vision I was sold.

Selina Tobaccowala

Can you tell us who Dave is?

Selina Tobaccowala 

Dave Goldberg was one of the most wonderful leaders in Silicon Valley. He was the CEO of Survey Monkey. He was an extraordinary leader, extremely data-driven, and extraordinarily intelligent. Unfortunately, he passed away in May of 2015.

Shamanth Rao

He’s very much a fabled figure in Silicon Valley. So what was your first reaction when Dave told you about Survey Monkey and a business?

Selina Tobaccowala

For many of us when Dave first called us, and what was always a joke on our executive team, we would all say, “Surveys?” “Really?” But then you would hear the vision of using people’s voices to help make better decisions, of taking input on employee feedback, customer feedback in education, in nonprofits, across all of these different sectors, and really using people’s voices, to change how things operate and using data to provide people real benchmarks. 

That vision was there, and it was so exciting.

Shamanth Rao 

It would have been exciting, even though it was so small at the time. How many people were there when you joined?

Selina Tobaccowala

Survey Monkey was a very amazing business.  Ryan Finley, the founder, started the company in 1999. If you ask me, I think he’s the person who sort of invented the freemium model or one of the earliest people to do the freemium model.

In 2009, he sold a portion of the business to two private equity firms, and they brought in Dave and Dave then brought me in. 

The company was small in employees, which was amazing and had a very high margin. There were about less than 20 people when I started, but the company was doing $20 million in revenue. So it was a very, very unique business, which had scaled from a product and scaled from a user base perspective and a revenue perspective to a certain degree, but hadn’t really overgrown from an employee base perspective.

Shamanth Rao 

Wow. $20 million for a 20-person company is impressive. What’s even more impressive is where you and your team took it from there. So can you tell us about what happened at Survey Monkey? Over the next couple of years?

Selina Tobaccowala

We grew the business from 20 million to 200 million. We grew the employee base from 20 to almost 400. Dave’s biggest joke was that we all brought the margin down. But we’re able to grow the business quite well. One of the first things we did was international expansion. The business was almost completely US based in 2009. We were about  60% US and 40% international when I left.  That was one of the big things we did. We also introduced a bunch of new products. We introduced SurveyMonkey Audience, which was a way for people to reach customers and ask for basic market research. We launched SurveyMonkey Benchmarks, which gave people comparative benchmarks on their analytics. We also were able to just rapidly grow the business and the exposure of the brand.

Shamanth Rao

There’s so much that I want to dig into. But what I would love to do is take a small step back to 2009, to the time just before you joined Survey Monkey, I’d love to talk about what you’ve described as your learning moment.

Selina Tobaccowala 

Two days before I was going to interview with SurveyMonkey, I said to my husband, “Something doesn’t feel quite right.” And I took a pregnancy test, and it was positive. I went and I interviewed with SurveyMonkey and the board. I was flying back to London, and I landed and I had an offer in my inbox.  I really wasn’t sure what to do. So of course, I called my dad again. He said, “Be honest with Dave, he’s been honest and wonderful with you this whole journey.” 

So I sent him a note, and negotiated my package. I told him that I was an executive in Europe, so I had to give at least three months’ notice. And I said number three, I’ve early signs of pregnancy. Dave responded within minutes, and said he was determined to build a company that could support families, but also build a massive business, and that building the right culture, while also being profitable was very important to him. I got that email and I said, this is the guy I want to work for.  So I started a new job across the continent, across a different country, four and a half months pregnant.

Shamanth Rao

Wow, I can see why Dave Goldberg was considered so extraordinary. So what were some of the things that you learned from Dave?

Selina Tobaccowala 

There’s no way to summarize that quickly. There were many things I learned from him from how do you think about financing the company? 

How do you think about making sure that you build a company that is metrics and data-driven, but at the same place, leaves room for creativity? 

On the culture side, specifically, the thing that I learned and appreciated the most from Dave is that a lot of people talk about culture, a lot of people put their values on a wall, and then you know, write it up and tout them, but Dave was not focused on that. He wasn’t focused on making sure that we had them sprinkled everywhere, he was focused on figuring out the culture and the values that we actually wanted to live by and how you took policies underneath that, to make sure. 

One example is people always say that I want to take intelligent risks, or I want to be data driven, but in order to do those things, you have to be willing to share your metrics and spend the time making sure the whole company understands your business metrics. 

People say they want the ability to fail,  to create an entrepreneurial or innovative environment. Well, to create an innovative environment means you have to be willing to let people fail. 

So every month, we would stand up there in front of the whole company and talk about our metrics. But we would always talk about some AB tests that didn’t work. Dave was a guy who loved to bet and we would always place bets in the AB tests. Sometimes he was wrong, sometimes I was wrong, sometimes our head of growth was wrong. 

Being able to be willing to stand up there in front of the whole organization and say, here’s an AB test we tried, and this didn’t work and I bet on it. That just showed the company that you’re willing to fail. That you’re willing to take those risks. It’s not just about putting that value on your wall, it’s how do you actually have the policies underneath it? What are you actually doing underneath it to actually live by that culture? And that was the biggest difference that I saw with Dave.

Shamanth Rao 

I think it takes courage to fail publicly and to embrace failure as a value. That’s awesome. So to go back to something you mentioned earlier – international expansion, which I know was critical to SurveyMonkey. For most startups, the US seems to be a very high priority. The international expansion comes almost as an afterthought. So why was international expansion a priority for you guys?

Selina Tobaccowala

The US is a focus for most companies up to a certain point. Then there’s always an opportunity for international expansion. If you think about larger businesses, like Microsoft or Amazon, they’re about 50/50 US and international. I don’t think it’s fair to say, from that perspective, that companies don’t think internationally. It’s where in their life stage are they thinking about going international. 

At SurveyMonkey, we saw a very clear opportunity to make that leap and grow internationally quickly. Again, because SurveyMonkey also had this natural viral coefficient, you were sending surveys out to people, and then they were seeing the brand, which is you needed to see the market up to a specific point to get those network effects. We saw there was an advantage to going into those markets earlier and starting that sort of network effect in those markets. And so that was a big reason, we decided to make the investment to go international.

Shamanth Rao 

Can you elaborate on what you said about the fact that you needed to seed the market to a certain extent before you would start to see network effects?

Selina Tobaccowala

In any business that has any sort of network effects, you obviously need some base of customers to start that network. With SurveyMonkey, as an example, you needed to be touched by a survey just about over two times before you yourself would think okay, these are different use cases I’ve seen that I now think, “Oh, I can use this product myself.” 

That’s generally true if you look at some of the stuff that we just talked about, with LinkedIn, or I believe even on Facebook, there’s a number of initial people you need in your network for you to then become really engaged and part of that network. That’s true with any business that has network effects. If you have a business like that, obviously, getting into that market early, and especially staving off your competitors becomes really important.

Shamanth Rao 

So once you have a critical mass of users in any country, let’s say in Indonesia, then you have more and more people signing up for SurveyMonkey, simply because you already have other people who are already in the network. And these people want to interact with the people already in the network, and that self perpetuates. 

Something that SurveyMonkey very much pioneered was the freemium model. You guys were one of the very early adopters of the freemium model. Was this something you guys questioned at any point?

Selina Tobaccowala

Absolutely not.  Ryan Finley, the founder was the one who created the innovation around the freemium model. When you think about using a freemium model versus a free trial model, if you have a network effect, whereby touching those individuals, you’re actually building your brand, or you’re creating some value for the business, then you can do a freemium model, which is exactly what SurveyMonkey was doing, which is all of the free users were actually essentially marketing to other customers. That’s where freemium models work.

Or if you can get somebody into a freemium model where they’re naturally starting to expand usage or something that you then can drive them into paying but you’re hooking them in the freemium. That’s where freemium models work. So SurveyMonkey is absolutely the right type of business to be a freemium model.

Shamanth Rao

So how did you decide what features to keep free and what to keep paid?

Selina Tobaccowala 

It was a lot based on exactly that, which is, is this feature going to drive touching more customers, touching more recipients? That’s how you would start to draw the line. 

The other thing was looking at who were the users of those feature sets.  Are these users more likely to be educators and teachers? Let’s put those in our lower price packages. Are these users really going to be sort of market researchers at corporations? Let’s put those in our higher price packages. Because you have to think about willingness to pay.

Shamanth Rao

So they would have different price sensitivities. That makes sense. So how did SurveyMonkey get enough users to get to a point when network effects would start to kick in?

Selina Tobaccowala

When we took on the business in 2009, Ryan and his brother had really done almost no marketing at all, to drive the business. It was purely through natural virality. There was a good opportunity for SEO & SEM. We did paid media for the first time and so we built out a marketing function at SurveyMonkey, so that we could initially grow in markets as well as accelerate our growth in the United States.

Shamanth Rao

So you worked on surveys at SurveyMonkey for over five years. What were some of the things you learned about surveys that surprised you?

Selina Tobaccowala

One of the biggest things I learned about surveys that surprised me was how you can easily bias people with questions. I never really thought about that. If you ask people if they agree or disagree, most people in the US are going to agree with something because it feels nicer to agree with something than to disagree with something. 

How you word your questions. What the answer options are, that really needs to be so specific in order to actually get the right answer and learnings from a survey. That’s why we built at SurveyMonkey the concept of a question bank, where you could take questions that were worded correctly, that you knew you would receive a good result against.

Shamanth Rao

I imagine that had the added benefit of making survey creation easier for your users as well? Yes, for sure. During your time, at SurveyMonkey, you lived through the transition from desktop to mobile. Did you see this transition coming? How did you and your team think about adapting to this transition?

Selina Tobaccowala

For SurveyMonkey, we definitely saw there was a big transition from desktop to mobile. For us, the biggest place that that was happening was actually taking the surveys. We still have most people, again, this was a couple of years ago when most people were creating the surveys on the desktop and doing it from a work environment, but the taking was rapidly moving to mobile. Making sure that again, our survey page was our biggest brand touch making sure that worked really well on mobile was a big priority for us.

Shamanth Rao 

That makes sense. Fast forward to more recently, you started your new business Gixo. Can you tell us about Gixo and what inspired you to start it?

Selina Tobaccowala

Gixo is a mobile app that has live coached fitness classes.  It’s really unique in the sense that there’s actually a human live coach that’s training you and driving you through the class experience. We have a variety of workouts from walking and running to strength training. We have amazing music. We have this community of people that are taking the class with you, and then obviously the life coach. I started this company with Al Leib, who was my co-founder at Evite. And for both of us, we’re very passionate about health and wellness. 

For me, a big impact was Dave passing and thinking about how I could use technology to make a difference in health. It was just extremely surprising to us. You really only have to get people to move 150 minutes a week, 21 minutes a day, and it has massive impacts on people’s health. We knew that we could do that through technology, we saw this awesome opportunity, 

Shamanth Rao 

I can speak to the tremendous impact that working out has had in my own life in ways that I could not have imagined or conceived before I started working out. So tell me, why this model of having live coaches?

Selina Tobaccowala 

When you ask consumers and of course given my SurveyMonkey background, we did a whole bunch of consumer research, why they don’t exercise. So we just stepped back and thought about the market. You have 55 million people a year in the US alone who pay for gyms. And yet you only have 33% of people who use their gym membership. So it’s a very, very broken and inefficient model. And the gym doesn’t actually want you to come, right, they depend upon your breakage. 

So when we asked people why they don’t go, we consistently heard two things, lack of time and lack of motivation. And when you dig into lack of motivation, it’s very clear that lack of motivation is because it’s not enjoyable. When you look at all the academic research, and there’s a really interesting book by Michelle Seeger, called No sweat, and it talks about, one of the biggest things in exercise and fitness is if you can get somebody to change their mindset that this isn’t a chore, but this is something I do for myself, this is something I enjoy, that’s what helps people retain. 

When you look at the data of who is actually retaining in the health club space, it’s people going to classes. They’re more fun. If you have a live coach who’s moving you along, you have great music, and you have these other participants that you can engage with, it’s a more fun experience. I am somebody who literally did nothing for five and a half years. And now I look forward to my Gixo classes. That is the big differential. Most of the things out there are these pre-recorded experiences, you’re going after the 20% of people who are already fit, who are already exercising, and who already have motivation. We’re trying to help motivate and keep people accountable to the rest of the population.

Shamanth Rao 

I also think this has so many parallels with what you said about virality, while at SurveyMonkey, and at Evite, where, if people have a certain number of people in the network, or their classes, in this case, they’re more likely to bond with these other people, they’re more likely to stick around, and they’re more likely to come back.

Selina Tobaccowala

Yes. When you think about doing an activity, when you were a kid, and you were riding your bike with your friends, or you were playing sports with your friends, you didn’t say. “Oh, I have to go exercise.”  

You went to do fun stuff. Even today, going on a hike with your family, any of those things where you’re moving in that social environment. That’s one of the main reasons why people love classes, because you’re doing it with other people. So we saw that not everybody has access to these great experiences, especially for a very affordable price. So we saw this opportunity, where we could give people access across the entire country and eventually across the entire world, to this great class experiences for you know, only $19.99 per month for unlimited classes versus most classes are $30 per class,

Shamanth Rao

Do you think that having the model of live virtual classes can limit the audience you can reach, because people have to agree to make a commitment for a certain time, and then show up? And people can be flaky.

Selina Tobaccowala 

I don’t think it’s limiting what we can reach. We have classes from 2 am to 10pm, on the weekdays, and 5 am to 5pm on the weekend. We have a really broad coverage of times, so people can jump on nearly at any moment and take a live class. Yes, of course, some people sign up and don’t show up. But I think that people feel more accountability to coach and so we do have better rates than I think a lot of places.

Shamanth Rao 

Yeah, that makes total sense. You know, we are close to the end of the year. What are some of the things that you are excited about figuring out for Gixo?

Selina Tobaccowala

For Gixo our real main thing is figuring out, we have this product that people absolutely love, we have 4.8 rating in the app store, we have really good engagement, the customer stories are just outstanding, and now we need to figure out distribution. How do we tell the world about it in a cost-effective way? I’m excited to figure that out.

Shamanth Rao

Exciting. You guys are poised for some exciting growth in the coming year. Who do you consider your biggest influences? Who do you consider your mentors? What resources do you people learn from?

Selina Tobaccowala

Constantly from people all around you. So whether it’s official mentors, like my dad, or like Dave was, there’s another woman, Judy Estrin, who I call whenever I need help, but you actually learn from everybody, your employees, your colleagues.  For me, it’s continuing those interactions and continuing those conversations and being open to that from around you. In terms of books, I’m a heavy reader. I love to read, but I actually mostly like to read fiction. It’s all these books that are really helping you think about both pricing and consumer psyche in motivation,

Shamanth Rao

Selina, I know we’re very close to the end of our time together for today. So this would be a good spot for us to start to wrap up. Thank you so much for taking the time from your schedule to speak with me today. I’m very, very excited to share this conversation with the world very, very soon.

Selina Tobaccowala 

No problem. And good luck with it.