Getting the Startup Equation Right

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It was exactly the right team for a machine-learning, technologically-based startup. These were all people who had MIT degrees and track records building successful products. They were no slackers.

But when they decided they were going into the user-generated content direction, they knew it was not their strong suit. That's what I do. I had a lot of experience with building, designing, social software, getting a product integrated in other pieces of software—that kind of thing. It was a great combination of our two skill sets. I ended up joining their board, and then they made the unusual move of making me a co-founder late in the game. They did that because they had completely changed the direction of the product, no longer taking just a computational, algorithmic approach but building a user-generated content layer on top of it.

The Allure of Taking Risks

It would have been easy for me to build another social networking site, or another photo-sharing site. But I'm doing something different with Hunch, taking risks. This was a deliberate choice. I was offered jobs at VC firms and CEO posts at startups that already existed. These gigs would have meant much more money and security. I'm a single mom with a toddler, so I could easily have justified doing a less risky venture. You can rest on your laurels, or you can go out there, or you can start again and have no idea what the hell you're doing—which is obviously much more interesting. You have a much greater sense of invention, and you have the ability to create something new if you do that.

In 2006, I first met Rob Kalin, who is a co-founder of Etsy. I could see that they had a big and ambitious idea: to make a marketplace. Few people were doing any kind of marketplace startups then. He'd found a parade and gotten in front of it—people had tired of big-box retail and the soulless manner in which products were bought and sold. There was no longer any humanity in marketplaces, which throughout history had been meeting places and places where people socialized. It was very clear that Rob was not going to fail. He was a very resilient and determined founder. He walked the talk. It was a very community-driven site, and through and through, he stood by what he believed in. He created a company that reflected the values of what the company itself was trying to build, which was a means by which regular people have a very human contact with one another by the things they make and the things they buy. In fact, Rob recruited Jared Tarbell, whom we'd tried, and failed, to recruit for Flickr.

My point with these examples is that the combination of the idea and who is doing it can't be emphasized enough. Obviously, lots of factors go into the success of a company, but in my experience, those two are the most significant. You have to be building the right thing, first of all. And the right people can figure out how to build it, how to market it, and how to make it a winner.

—As told to Nick Leiber

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