We spoke with entrepreneur and investor Brian Norgard on his company Chill.com, the importance of the team, when to pivot, and what it takes to build a killer startup.
Brian Norgard is one of the pillars of the Southern California startup community. He has co-founded a number of successful companies, including Newroo (acquired by Fox Interactive Media), Adly, and now Chill, which have received millions in funding. He is an expert in building great internet products, assembling winning teams, and understanding user behavior. Follow him at @BrianNorgard.
TELL US A LITTLE ABOUT WHAT’S GOING ON WITH CHILL
I think Chill is a really exciting project right now for a variety of reasons, but none more important than video is exploding on the internet. Video is the most expressive rich medium we have for telling stories. It’s amazing how important and impactful video is on our life. If you look at the data, by 2015 there will be about 500 billion hours of video on the internet. So the real problem is discovery – what should I pay attention to? What should I watch? What do I care about? And frankly we think there is an amazing opportunity for a great company to build an amazing product for customers in that category. If you look at the evolution of the television business which started in the 40s and hasn’t really evolved all that much other than a few blips on the radar, such as the VCRs and DVRs. But really, the internet and the television are going to merge. I don’t believe the experience is going to be pure internet, nor do I believe the experience will be pure television, it’s going be its own world with its own dedicated user-interface. Where Chill fits in is that we want to be at the center of discovery and helping people find interesting video content.
HOW DID YOU GUYS COME UP WITH THE IDEA?
We’re the spirit of two hackers. We’re always building new things and trying to figure out interesting uses of technology. It became clear in one of our old projects that people really had an affinity towards watching videos together and socializing around that video. So we asked ourselves, how can we build dedicated products around that experience? As with most great products there wasn’t a eureka moment where it all came together. It’s a series of thousands and thousands of small modifications and adjustments that led us to what we have today.
IS THERE ARE A CERTAIN MINDSET AN ENTREPRENEUR NEEDS TO HAVE TO MAKE SUCH ADJUSTMENTS?
Certainly. I’ve always called what we’re doing ‘evolutionary product development’. It looks a lot like a biological system where there are mutations and different adaptations emerge to allow different organisms to excel at certain environments. If you look at the past to building great product, most of the companies in market today with something that is defined as a great product, have taken a lot of turns in the road. That’s a function of the market changing very quickly. Also, to really execute on building a great product you have to be in market, listening to customers, listening to partners, understanding the entry points. I feel that this, and keeping your eyes and ears open, is a quarter of the battle. In order to really do something great you have to be in the saddle. We’ve made a lot of changes, adaptations and mutations, some good and some bad, but my general sense is that each time we do something we do it for a reason. And generally because the consumer internet is so reflexive (meaning that you can build something and get immediate feedback) it really is a series of thousands of little changes that add up to a new product that people love. It’s no secret. If you look at some of the early successes of consumer internet, such as OMGPOP, Path, Chill, everyone had something else before. Everyone. So it’s an interesting observation that most of the companies doing stuff that is perceived as high quality have started with a different idea.
SO ULTIMATELY IT’S ABOUT LEARNING AND HAVING THAT CUSTOMER FOCUS
Yeah. Learning, trying things, being really open to new concepts, and also being dogmatic about what you want to do for the customer. I see a lot of people pivot blindly many times with varying degrees of success, but in general if you don’t know what you’re building for that customer, a pivot is going to be really hard to pull off.
YOU’VE FOUNDED A NUMBER OF SUCCESSFUL STARTUPS. IS THERE A FORMULA YOU USE WHEN DECIDING WHICH IDEAS TO EXECUTE?
It all starts with intellectual curiosity, the ability to look at the world in a different way, not to accept the status quo or what people tell you the world should look like, but rather to accept the new model in your head as the new framework. So I’ve always started from the point of curiosity. If I’m not curious about a market or opportunity that will force me to read 100 books and talk to 100 people, I’m obviously not going to enter it. The second level is to really start thinking critically about what is the customer experience today and how can it be improved? I’ve always said that building products is not as much about such things as the technology you’re using on the backend, but rather understanding customers, incentives, the economics of attention, what people react to, what people don’t react to etc. I feel there are a ton of different skills that go into building a great product – part psychologist, part sociologist, part art-director – you have to combine tons skills. A lot of times when you see people with multiple perceived successes, in general what ties them together is an abstract skill set that brings together a lot of different disciplines. That’s what allowed us to stay in business. I think we have a lot of different skills and we try to put them to use. Of course you can get better over time, but your skill can atrophy too if you don’t keep up with the new environment. There have been a lot of new developments in mobile in the last few years and I know plenty of world-class product engineers that have not kept up. They haven’t absorbed themselves in iOS or Android; they haven’t spent the time using these devices. And frankly, the world is moving so quickly that if you’re not using them and actively trying to learn about them, the world will pass you by.
YOU’VE BOTH RAISED MONEY AND INVESTED IN INTERNET COMPANIES. WHERE DO YOU SEE THE FUNDING LANDSCAPE HEADING IN 2012?
It’s a beautiful time to be in the software and internet world. It’s changing how we do everything – how we interact with entertainment products, within our businesses, commerce, everything. It’s a fantastic time filled with tons of opportunity. The costs of starting a company and getting to a point where you can show some sort of product to an investor continues to decrease. But I said something on Twitter the other day “The cost of creating software companies is going down, but the art of entrepreneurship continues to get more expensive.” What I meant by that is that it’s a standard bell curve: you’re going to have huge amounts of people in the center. There are going to be those tail players that really get it, and that’s with any mature market. It’s going to commoditize in the center. There is a ton of smart money out of there for people who have really focused ideas with teams that support the idea. Anyone can come up with an idea or mockup, but can you build a team around the concept? Your first idea is probably not going to be the one you execute on. So when I look to invest in startups and what most early stage investors are looking for is a quality team. And that is hard to build. Not only is technology cheaper, but also engineering and product talent is becoming more diffuse because there are a lot of smaller companies. So building a team of 3-5 really smart people who are all attacking a big problem is worth something today. But it’s also gotten extremely hard because there’s so much competition from so many different angles. So my analysis of the funding landscape is that it’s absolutely one of the most beautiful times in history to raise capital. But it’s somewhat bittersweet, because the barriers of entry have lowered but building a quality team now might be even harder than it was 3-5 years ago.
WHERE DO YOU SEE TELEVISION HEADING?
TV means a lot of things to a lot of people. To some people TV is sport. To some people it’s Netflix. To some people it’s soap operas. So we have to be very clear that the term TV is an overarching terminology for people spending time consuming video content. What I see coming in the near future, and it’s very hard to predict timing wise, is a dedicated consumption experience around a variety of different screens in the living room – so you have an iPad, Android tablet, or phone paired up with your television. So these devices will work in harmony together with a dedicated user experience. Every great product that people spend time with develops a dedicated user experience. The reason why is that customers are going to live in this world. They want it to be beautiful, responsive and really thoughtful. Therefore, pasting a web UI on top of a television is a terrible idea. As is sticking with the UI that comes with our Comcast or Time Warner Cable subscription. So I think what you’re going to see is an entire new class of interface design emerge around a bigger device, that is probably going to be controlled with voice and tablets. Nobody knows how that is going to play out because these platform wars are complicated and bloody, but I wouldn’t be surprised at all that if you look at your television experience in five years it will look nothing like it does today.