SXSWi: Where five days can seal a start-up's fate
Co-founders of Fast Society, an eager New York social app start-up, believe that the company's success at the Austin festival next month will indicate whether it will survive another year.
NEW YORK--"It was like a black hole," Matthew Rosenberg, 28, says of the failure of his first company, eDopter. "It was the hardest thing I've ever done. Having a start-up and putting two years of your life into something and watching it fail is gut-wrenching."
eDopter, a trend-tracking start-up, launched in 2008 at a time of peak economic panic, when venture capital activity in New York was stagnant and, as Rosenberg and his co-founder Andy Thompson relate willingly, a prospective investor bailed in the middle of a lunch meeting because he saw what a precarious drop in the Dow had just done to his portfolio. eDopter ran out of money.
Rosenberg and Thompson are hoping that the outlook will be brighter for Fast Society, a mobile start-up that they have co-founded with a third friend, Michael Constantiner. And in the short term, that means there is one huge goal on the horizon: make a splash at the South by Southwest Interactive Festival (SXSWi) next month.
Powered by a small amount of angel investor money and a whole lot of caffeine, Fast Society has been readying a revamped version of its iPhone and Android apps to launch in conjunction with SXSWi, and almost as importantly, it plans to throw a party to get the word out and accelerate its momentum. The stakes are high: As a gathering point for thousands of technology enthusiasts from around the country who are just as eager to meet up for margaritas as they are to attend conference panels, the annual Austin, Texas, extravaganza has proven the perfect stage for new trends in social media to emerge. Fast Society wants to get noticed, but so do its competitors in the emerging sector of group messaging, in which temporary or permanent clusters of cell phone users communicate with one another through text messaging or a smartphone app.
It's a packed space right now. There's GroupMe, fueled by a fresh $10.6 million infusion of capital from top-notch firms like Khosla Ventures and First Round Capital (and which recently announced that it processes 1 million messages per day), and Beluga, founded by a team of former Google engineers. Fast Society acknowledges it's the underdog, and that a poor showing at SXSWi may put it out of the running.
"We're scared out of our faces, because there's tons of anxiety and there's so much pressure," says Rosenberg on a weekday afternoon in a conference room at Dogpatch Labs, a group workspace for small start-ups run by tech investor Polaris Ventures. "South by Southwest is already, it's intense, there's a lot going on. And then to launch a new product and to know that people in our space are going to be launching these products at the same time, and to know that everything depends on this...We're competing with people in our space not just in our space but in general that have tons of money."
Rosenberg is trim, with a prominent brow ridge and round blue eyes that grow wider and wider as he talks in an earnest staccato about Fast Society. Across from him in the Dogpatch Labs conference room are Thompson and Constantiner, both 27, who are quieter than their co-founder but sport the same symptoms of restlessness and sleeplessness--a generous peppering of stubble, dark circles underneath their eyes. All three can finish the majority of each others' sentences; their rapports are as deeply personal as they are professional. Rosenberg and Constantiner have known each other since elementary school in Houston; Thompson was in the same fraternity as Rosenberg at American University in Washington, D.C.
At Fast Society, none of the three (they recently hired a fourth employee) holds the title of CEO. Constantiner runs business operations. Thompson is the developer and designer. Rosenberg, who holds the title of "Director of Ideas," says he's the liaison between the two.
"What's the word you call me?" Thompson asks Rosenberg.
"I feel like he's a unicorn--"
Thompson interjects. "They'll just refer to me as 'unicorn' on Twitter."
"Andy's probably the best designer I've ever met," Rosenberg says. "And he's probably one of the best designers in the world--"
"...and every time he says that, I say, 'Don't say that to people ever again!' It puts kind of a high mark of expectation on me," Thompson jokes.
"But it's true," Rosenberg insists, his eyes growing wide. "And he's equally good at development, which is rare." Like a unicorn. Hence the nickname.
The ebullient, party-ready Fast Society co-founders are hardly conventional in today's start-up world of change-the-world rhetoric, talk of "platforms" and "utilities," and hardcore allegiance to the "hacker" spirit. Thompson says he has been designing and teaching himself code for most of his life, but beyond that, all three co-founders are marketers rather than engineers, going all the way back to Rosenberg and Thompson's respective college internships at then-upstart beverage brands Vitamin Water and Red Bull. Their aim is not to build a technology that the entire world will use, but a finely honed youth brand. "Our backgrounds--we're about brands. The site is as much a brand as it is a product, and we spent so much time trying to do that," Rosenberg says. "We're only focused on 13- to 30-year-olds that are socially active. We're a social tool."
And the company almost didn't happen in the first place. Shortly after they'd thrown in the towel on eDopter, Rosenberg and Thompson went to a concert by electronic rockers Bloc Party and spent some time talking about how difficult it was to connect with friends at the crowded event. They envisioned some kind of mobile software that could bring it all together. But they were skeptical: "I was kind of looking for a job. We weren't sure we wanted to go down this path again," Rosenberg admits.
It was another fortuitous set of school connections that made things happen, Rosenberg and Thompson relate. Jeff Rosenthal, a friend of Rosenberg's from college, had recently begun working for the Summit Series, an elite of young entrepreneurs, and the two were hanging out with Doug Imbruce, a New Yorker on the verge of moving to the Bay Area to start a now-buzzworthy and well-funded endeavor called Qwiki. It was a clear summer day, Rosenberg recalls, and they were hanging out by New York's downtown waterfront at North Cove Marina, a small set of moorings off the Hudson River that are packed to the seams with sailing schools' vessels, a few small private yachts, and upscale floating bars that host many a Financial District company's booze cruise.
Rosenberg was struck by Imbruce's confidence. "No one knew what Qwiki was, no one had even heard of him, and he's like, 'I had this idea for this thing. I'm raising money for it'," he relates. "And I was like, yeah, I told him about what we were doing, that I'm thinking about getting a job, I don't know what to do, I have this one idea but I'm not sure it's any good. I told him the idea for Fast Society and he's like 'Dude. You gotta do that.'"
Seduced by the same entrepreneurial siren song, Rosenberg and Thompson decided to go ahead with Fast Society. They called up Constantiner, then living in Los Angeles and working at talent agency CAA, to convince him to join them. "I'd wanted to do a start-up of my own, or something, so Matthew called me, and we'd been talking, and he was like, 'Look, we have this idea to do this group text-messaging app, and we'd love to have you help out," Constantiner relates. "I was driving to work that morning, and I just end up circling the building, making loops around CAA at 8:30 in the morning while we were on the phone for like, 30 minutes. And I went in and basically told my boss that day that I was leaving."
'Built to party'
Assembling a team is one thing. Building and releasing a product is another. Making it through SXSWi as a brand-new start-up is Herculean. Fast Society has tried to cover all the bases: They've booked a party venue in a strategically close location to the central goings-on at the Austin Convention Center. They've enlisted an event planner, Ben Hindman, a former marketer for men's entertainment brand Thrillist who's in a similar make-it-or-break-it position as he gets closer to the launch of his own company, One Clipboard. They're doing everything they can--up to and including appeals to divine intervention--to ensure that the overhauled app shows up on the iTunes Store in time.
But just being ready isn't enough. SXSWi is less a technology conference than an annual experiment in hypercharged socialization, a driving range for whacking mass amounts of digital media at the proverbial wall and attempting to see what sticks, a test of the human limits of social app overload. There will, invariably, be at least a dozen other parties that night, some heavily promoted over the weeks leading up to the festival, and some planned and announced a matter of hours before they flood the Driskill Hotel bar with badge-wearing conference goers. The outdoor-terrace-laden Austin could be hit by a rare deluge of rain, as it was during one night of SXSWi last year. It's exactly the kind of noise and chaos that Fast Society and its competitors are designed to help people navigate, but these new companies have to prove their ability to navigate it, too.
Failing the first time around may not have given Rosenberg and his co-founders the track record of GroupMe, whose co-founders left plum engineering gigs at Gilt and Tumblr to start their company, or Beluga, with the street cred of an ex-Googler founding team. But it's given them a taste of reality, they say, and it's made them gutsy.
"The reason we've been able to do Fast Society, the reason that this feels awesome just to be here, is that it's never been easy for us," Rosenberg says. "We're a company that's never had it easy. Everything we've ever had to do or make has just been a straight-up hustle."
They have a believer in Doug Imbruce, the Qwiki founder whose enthusiasm inspired them in the first place. "With a tag line 'built to party,' how can it not succeed at SXSW?" Imbruce wrote to CNET via e-mail. "That's practically the conference's tag line."
In the back of the Dogpatch Labs conference room, there's a dry-erase whiteboard--the preferred wall hanging of young, volatile start-up life--as the Fast Society co-founders are still bouncing around potential ideas for SXSWi. As long as they can afford it, nothing's out of the question. The only thing that's for sure, Rosenberg says: "We want to do something that's f***ing cool."