By Scott KirsnerGlobe Correspondent
Silicon Valley tech companies are lined up to go public like jumbo jets on a runway.
Uber, Airbnb, and Slack, a maker of collaboration software, are likely to be next for takeoff. Already aloft are Pinterest, a site for collecting digital stuff, and the transportation app Lyft.
Lost amid all the buzz about jumbos are the smaller “aircraft,” well-made and reliable, that figure out an efficient way to get from Point A to Point B. One is a San Francisco startup you probably haven’t heard of called Poll Everywhere. It provides a fascinating contrast to all those buzzy “unicorns” with money to burn: It built a nifty product, didn’t raise jillions in venture capital, and has attracted very little press over the past decade.
Advertisement
Instead, it has simply focused on attracting customers such as McDonald’s, Google, Harvard, and Northeastern University.
Poll Everywhere was still in stealth mode when I first came across it, at a 2008 “demo day” in Cambridge hosted by the investment firm Y Combinator, which provides a small amount of seed capital and a lot of learned advice to help its companies become successful. (Back then, Poll Everywhere got $20,000 in exchange for a roughly 6 percent stake in the startup.) At the time, I instead profiled 15 other companies; just about all of them flopped.
Y Combinator’s motto for startups is simple: “Make something people want.” (Among its alumni are the lodging site Airbnb and Dropbox, a data-storage service.) Poll Everywhere did exactly that. Using the company’s software, a presenter, for example, or a teacher could add a polling question to any PowerPoint presentation — “What brand of mobile phone do you own?” — and the audience could respond by text. The slide would create a live chart as the answers came in.
It “was a product that by its very nature spreads, because people in the audience have to use it,” says cofounder Sean Eby. “As soon as somebody brings it up in a presentation, it would pique peoples’ interest.”
From the start, Poll Everywhere had a pretty straightforward business model: a free version that offered basic polling function, and a pay version for those who want to run lots of polls with lots of audience members — currently starting at $10 per month.
Advertisement
In fall 2008, Poll Everywhere sought other venture capital funding, during the thick of a worldwide financial crisis. It struck out, in part because the company seemed to lack ambition.
“I had us on track to make a few million dollars in three years, but that wasn’t good enough,” chief executive Jeff Vyduna recalled of his pitch presentation. “People said, ‘You need to think bigger.’ ”
Eby says angel investors offered to invest about $600,000 but the three founders decided to pass. “We were already growing with revenue, and it seemed like the extra $600,000 wouldn’t have moved the needle a lot,” Eby says.
Plus, they would have had to hand over more equity to those investors.
Instead, the founders focused on improving the product and marketing it better. (Teachers turned out to love the idea of live polling, to keep students’ foreheads off their desks.) The vision has always been simple: Given that audiences have the choice of zoning out, how do you keep them engaged?
Advertisement
“Nobody knew it in 2007 or 2008, but smartphones became the natural enemy of every presentation,” Vyduna says. Poll Everywhere gives audience members something constructive to do with their phones.
A few years after finishing the Y Combinator program in Cambridge, Poll Everywhere migrated west.
When did the founders feel like things were really starting to take off? Vyduna recalls a moment in 2012 when they wondered what percentage of Fortune 500 companies were customers of Poll Everywhere. They did a quick search of their database and discovered that it was more than 60 percent.
“It was a real moment to realize that a dinky team of about 15 people working out of my apartment could make something that so many industries and professions found useful,” Vyduna says.
Today, Poll Everywhere has 58 employees and nearly $10 million in revenue. “The goal of the company has been to have close to zero profit, and to be always reinvesting in growth itself,” Vyduna says.
When Poll Everywhere showed up on the Inc. 5000 list of fast-growing businesses in 2018, its three-year growth rate was 96 percent. Not too shabby.
Vyduna says he doesn’t tend to boast or get nostalgic about what he and his colleagues have achieved. “It was kind of tough,” he says. But “that toughness forced prioritization.” The company had the money to pursue only a few chosen ideas, and not enough to chase everything that seemed halfway interesting.
The founders managed to retain control of the company — almost 70 percent, according to Eby — with another 20 percent set aside for employees. (While Eby still has a stake in the company, he left his day-to-day role at Poll Everywhere several years ago.)
And they don’t have this problem: When you raise millions from outside investors, “the price you’re going to need to sell the company for just skyrockets, and you’re on their time scale,” Eby says, meaning they hope you’ll sell or go public at some point in the not-too-distant future.
The only outside shareholder, aside from Y Combinator, is Chris Sacca, a former Google executive who also has advised the company. Sacca has been an investor in Instagram and Uber and has occasionally appeared on television’s “Shark Tank.”
Sure, venture capital money enables a startup to embark on a long journey — often in search of a workable business model — in the hopes of one day being worth billions. But there are other ways for entrepreneurs to get to a worthy destination, and Poll Everywhere is a great example of that.
“In many ways, it was the anti-startup startup,” Eby says. “We kind of threw all of the [rules] out the window, and it worked for us.”
Scott Kirsner can be reached at [email protected]. Follow him on Twitter @ScottKirsner.
Let’s block ads! (Why?)
