“If you don’t adapt, you die,” Loic Le Meur told me when he came into the TechCrunchTV studio last week. And Loic – aka monsieur Pivot – is certainly one of the Valley’s most skilled adaptors. Having founded Seesmic in 2008 as a video aggregation network, he then transformed it the next year into a popular consumer Twitter client before shifting it earlier this year into a Salesforce and Softbank backed enterprise CRM tool.
The pivot, of course, is the thing these days. And Le Meur – perhaps because of his skill as a wind surfer – is a master of sniffing changes in the business environment before anyone else. In contrast with Catarina Fake and Philip Kaplan, Le Meur is strongly opposed to what the calls “the disposable start-up.” For him, he has a moral obligation to his investors at Seesmic (which include Mike Arrington) to adapt the company to the new environment – even if that sometimes means transforming the company into something unrecognizable from its previous incarnation.
So is monsieur Pivot right – is the “disposable company” immoral?
This is the second part of a two part interview with Le Meur. Yesterday, he explained why European start-up entrepreneurs have nothing to learn from their European counterparts. That post sparked a sharp rebuke from TechCrunch Europe’s Mike Butcher. And Loic responded himself in the original post comments.
Why entrepreneurs who don’t adapt, die
Well, but sports cars don’t get continually pivot. Do they?
Well no, if you do 360 then it’s not good, in sailing either. We’re not circling around, we started as a, you know, a video company I don’t even…
When was that?What year? That will be four years ago. Mike Arrington was one of your original investors. Yeah. He still is, disclosure. You’re not Mike Arrington though. Not last time I checked. I guess, you find. You know, that didn’t work and there was an option and which, I think, is an interesting topic where, where as an entrepreneur when you just launched something and we picked out a 100,000 users, didn’t grow suddenly because I think I exhausted of space of people want to do, you know, video conversations aren’t that many and then I decided I took it to my board and I said and i think that that’s something else that an entrepreneurs should do, is to be proactive to his board. And I said look, you know, we raised 12 million dollars, that didn’t work, what do you guys want to do. Here is an option that I see, that was the beginning of Twitter. We, acquired the second in chronology Twitter clan which was Twill and funny enough I did it to have video growth. And then that grew, like crazy. It was one of the first, you know, Twitter clan that was out there. And I recommended we focused on this because I thought that like there’s a Zynga on Facebook that there would be big companies on the Twitter ecosystem that will grow, and I thought it was very interesting. And my whole team and I have a passion for Twitter. So we did this, and I think the space has changed a lot again with TweetDeck being acquired. I was sure it was Seesmic versus TweetDeck. Well, there’s no story any more, because we’ve changed again, and now we’re a social CRM. But did you… Some people, perhaps, would say that TweetDeck beat you. Is that fair? When you were trying to compete with TweetDeck. In market share they’ve been bigger, for sure. No problem saying that. Now there are some…
Why do you think that was?Wait, I think it depends on the platform. For example, on Android we’ve always been very successful. We’re hitting like a million installed downloads and a very significant number of active users daily, which I can share with you if you’re interested. But it depends. Focus on the platform and also what we did, I think is very innovative. We have a plug-in platform with eighty partners on it. I think it’s cool. And of course we have our core user bases growing. But I don’t think we should compare it anymore. This is a subsidiary of Twitter now, right, which makes it interesting because we suddenly started competing with our biggest partner, Twitter, right? So fortunately I don’t have a crystal ball, but I saw the winds changing direction. A year ago when they acquired Tweety at the shop conference basically was a strong message that: 1. That ‘we’re competing with anyone doing a client.’ 2. That ‘maybe clients are not welcome that much any more’. So we raised money from sales force, and I can explain what we’re doing, but basically we’re like 80% about social CRM, which is targeting the professionals, and not any more of the consumers. Even though we’re happy have a lot of consumer users, we have a lot. But we’re going after a totally different target, which is mostly Salesforce customers now. We’ll get onto the Salesforce and the CRM market in a few minutes. But why do you think TweetDeck took off, while Seesmic in some senses didn’t. No, you can’t say that. We have ten percent monthly growth for like eighteen months, so we took off! Now you asked me a question and I gave you an honest answer on market share. You said are you bigger than them? No, they were bigger. But you can’t say we didn’t take off. I can show you my user growth, it’s very impressive and it’s activities seem to be growing very nicely. Like ten percent a month. So that’s nice, you know, it’s not, not take off
Seesmic’s new CRM business model
You’ve beenPivot-ing recently, what have you been up to? As I said, you need to be very agile when you start a business, adapt to current market conditions, and I think the opportunity of building client apps around query is closed, and that pushed us since the Twit acquisition to do something else. And it’s been a year, fortunately we’ve been working on it. We raised money from Salesforce. What we did is very very easy, we looked at the consumer versus professionals market, and the consumer space around Twitter is basically shut down for what we do, I think. So, when you look at the professionals, you have two types of businesses here. There is one which is helping people manage their social networks, which we do, and which…where we have a lot of growth. So basically it’s the brand managers, community managers, people like that. That’s one. There is another one which is even more more interesting I think, where I think we’re creating our space right now, where we’re alone, is the CRM plus social space, especially on mobile. And I give you the use case: it’s more like salespeople. So if I meet you and you’re an opportunity for me, now we’re getting into CRM. I want to check you out on LinkedIn maybe. I want to see if there is an opportunity with you. I will log it in the CRM tool, like Sales Force, which is leader. And then I want to maybe follow you on Twitter and add you on Facebook and so on. But you know what’s the most important is finding leads on those social networks as well. So let’s say you say…you tweet, “I want to change my car.” You’re a lead for a sales dealer, for example, for a car dealer, I’m sorry. And so bringing CRM on one side to social on the other side, especially on mobile. We have seventy-five to eighty percent of our new users on mobile, mostly on Android is fascinating to me. So that’s what we’re doing, our company is you know, not in that you know, trying for Twitter space anymore. We really value a lot social: Twitter and Facebook and LinkedIn. But we do it through the use of professionals which are using CRM. So it’s very different. I move from one ecosystem to another basically, like, very fast. And we are now building mostly for SalesForce, with SalesForce. We have incredible support from SalesForce. So is SalesForce just an investor? What proportion of the company do they own? Oh, we made this public. They invested, we invested, we got a four million dollars investment from SalesForce and SoftBank. That’s way like a clear minority for us. It’s a small chunk of our company. I’m not authorized to discuss exact number, but it’s not big. And what’s the business model? How do you make your money in this new market? Very simple, we will release end of August new apps which will be on the new mobile. Mobile I just described, which is social on the one side, we already have that. Instead of monetizing this, we’re adding CRM to it and we will monetize it when we have CRM. It will be a per user, per month fee which is the same business model as SalesForce. We were looking, some engineers and TechCrunch and myself, were looking at the sesmic site just before ths interview. And it promises at one point on the site you’re the only social media tool that you’ll ever need. Is that true for everybody or just for corporate clients? If, I should probably change that now that you are saying that. It’s a, it’s a tool that embraces Twitter, Facebook, LinkedIn, now SalesForce, CRM soon and if you use our desktop it has 80 integrations so, for example, maybe you use Chatter Bill so instead of you use Yammer we have both, you choose, right? Maybe you want to add customer support. We have a zen desk plug in. It’s there as well. You see it’s like, it’s like a puzzle. You assemble the modules, it’s like modular, you assemble the modules you want. So in that respect, yes, we are the only social networking tool in the world that has so many services, 80 of them.
On the immorality of the “disposable startup”
Social networking, mostly Twitter, and now Sales Force. At any point I could have just said, “Enough, right. Here is your money back, investors, thank you will start over something. Maybe you want to participate with something new.” But some people say that’s very moral, as the right thing to do. That’s what I do because I feel responsible. I think it’s important. I think it’s a long term, imagine as an entrepreneur that you’re defending, as well. our arguments for both because the more money you raise, we’ve raised 16 million dollars, the more like baggage you’re carrying as well. You see what I mean. You carry that with you. So, I could raise again and again and again, and probably, we’ll see if I need to, but we’re trying to do a revenue now. That’s the agenda instead of raising. I think it’s going to do great. But it’s two different styles and I was thinking about a blog post actually via disposable startup. And think about Google. Right. Gmail. Hit. Google Maps. Hit. Google Earth, you see the point. But at the same time Google Buzz, not good, they shut down Google Health two days ago. It’s Google operates that way.
So, why wouldn’t the startups operate the same way it`s like the disposable startup that you launch, you raise whatever, 1 million, 5 million, 10 million, doesn’t work – stop as fast as you can. Do something else, it’s not what I’m doing. I don’t think I would be doing that or I would say at the very beginning. If you raise money here is what I’m gonna do with it, and if it doesn’t work we’re going to stop. I guess if it’s clear with your investors, fine. But, Blippy was surprised after nine months. Actually the company is still around, but Phil already tweets around this new gig, right? And by the time I, he wrote. Did you say pivoted? Pivot. You pivoted. Twice! I guess Katerina has launched one and now a second company. I’m not criticizing. By the way, I think those are two different ways Did you offer their investors their money back? We had a discussion when the video thing didn’t take off, and we could have came to that conclusion. That happened with Twitter, of course, and some of the investors lost out massively. So, it works both ways. Right because they could have been an invester in Twitter. Yeah. And I know absolutely some of them, one quote who are very pissed that they could not get in on Twitter. What do you think you learned most of all from the failure of the first two versions of seasoning that’s helping you now. I learn absolutely everyday you know. I think I was. But you’re not answering my question, what did you learn? We all learn everyday. Well, yeah, what did I learn? I think for the video thing, it was mostly that video is very tough, because not everybody is like you and me, able of discussing in a natural way I think as much as possible in front of cameras. Most people are shy, afraid of their image, they don’t like it stays online as well. Like Scoble or something like that. I’m not giving example, actually Scoble is fine, but he doesn’t give a damn right? Yes. But most people like, so that’s one learning. Video, if you look at this period, when I launched Seesmic, the first version of it, it was all about video, it was juice actually launched. There was a number of YouTube competitors, there were, UStream was barely launched. And that’s apparently a success. wish for John. But you see what my point is that everybody thought video was the next thing, and since then, what happened, YouTube took it all. How many video startups are actually successful? Very few, right? I don’t know many startup entrepreneurs building stuff around videos these days, because it’s very tough. Have you had any crises though as an entrepreneur in terms of your faith in yourself? You’re clearly a very skilled promoter and marketer, but obviously given the failure of the first two versions of Seasoning there have been some questions about your skill as a startup entrepreneur. Really? Did you see that somewhere? Well, it’s something people sometimes say. Really? Yes. That’s very European of you to ask these questions. Why European? Because Europeans love to talk about failure and how bad it is. Here we celebrate it. Come on. Well I was a, most of our audience probably don’t know this. I had a company in the 90’s called Audio Cafe, it was a massive failure. And you failed. I failed, but it convinced me that I was a terrible entrepreneur, and I’ve never tried it again. Big mistake, Andrew. Big mistake. Why? Why? Because if you failed, that means you learned a lot, and you should…
Yeah, but at acertain point, it’s like, I interviewed Ron Conway. He’ll always invest in someone who’s failed once, occasionally twice, but if you failed more than twice, he’ll never invest in you. Well, you know, I…
But…Back to the question. You know, Le Web is a huge success. This is my fifth company. And by the way, this is not failure yet, right? So we’re doing pretty well.