In front of a packed crowd at Tech in Asia Singapore 2017, Reddit co-founder Alexis Ohanian made it clear that the Lion City holds a place close to his heart. “It changed my life,” he said of Singapore. “This was where I decided I wanted to be an entrepreneur.”
In his Wednesday afternoon fireside chat with Mashable APAC director of strategy and business development Gwendolyn Regina, Ohanian explained that his first trip to Singapore – well over a decade ago – came as part of a tech entrepreneurship competition at the National University of Singapore. Inspired by the atmosphere, he pitched his professor an idea and then fired off a very enthusiastic email to his friend Steve Huffman. That email marked the beginning of Reddit.
Not that it was smooth sailing at first. “We got smacked in the face with failure,” Ohanian said of his and Huffman’s early efforts. Their original idea was called My Mobile Menu – a phone-based ordering system designed for restaurants in the pre-smartphone era. The pair dove into the idea without doing much to confirm that it could actually work. “We spent a year working on a product that we didn’t really test,” he said. Restaurateurs would express enthusiasm, but none ever signed on for real testing.
That’s an important lesson for founders, Ohanian said. When you’ve got a startup, “everyone tells you it’s a good idea because no one wants to tell a founder their idea is terrible.”
Eventually, Ohanian and Huffman pitched the idea to Y Combinator, and the Y Combinator team liked the two of them enough that they offered a US$12,000 investment on the condition that the pair pivot away from the mobile menu business. Ohanian and Huffman agreed, and Reddit was born.
Advice for founders
Looking back on his journey from the perspective of a successful founder and investor, Ohanian found lots of lessons worth sharing with would-be entrepreneurs. “I see so many founders who are idea-rich but execution-poor,” Ohanian said. “At the end of the day your ideas don’t actually matter.” What matters is execution. Startups should do precisely what he and Huffman failed to do with My Mobile Menu, Ohanian said: “Make a product and test an idea as soon as possible and as often as possible.”
He also reminded founders that there’s no single path to success. You don’t need to penetrate Silicon Valley’s inner circles to make an impact. Snap co-founder Evan Spiegel was rejected by Y Combinator, Ohanian reminded the audience, but that clearly didn’t hold him back. Entrepreneurs – and particularly entrepreneurs in Asia – should not feel restricted by the “rules” of Silicon Valley. “Innovation is not limited to just a zip code in Northern California,” Ohanian said.
Alexis also offered some less conventional advice for founders: take stock of your friends. “You have so few things in your life that you control,” he said. “It’s worth it to really do an inventory of your closest friends and ask yourself: are these people who make me better? Your relationships are one of the most important and zero-cost (in terms of dollars) investments that you can make.”
Ohanian’s VC firm, Initialized Capital, has scored big wins with early bets on companies that looked risky. Their secret, Ohanian said, is looking for the right sorts of indicators. In 2009, for example, Bitcoin seemed like little more than a gimmick to many, but Initialized was willing to bet on Coinbase because they saw that co-founder Brian Armstrong believed in it enough to give up on a promising position at the ascendant Airbnb to build it. Soylent also seemed like a crazy investment in the early days, Ohanian said, but he and the Initialized team noticed that the startup already had an active and dedicated group of supporters on Reddit. Knowing that the company could leverage that passionate community, Initialized bought in.
Conversely, Ohanian said there are also a few signs that a founder might not be a good investment. Chief among them: a founder who has raised money and done little with it but wants to re-up. Many founders build working products without any funding, Ohanian reasoned – a company that’s been lucky enough to find funding but hasn’t been able to make much use of it probably doesn’t have any hopes of longevity.
As far as his personal aspirations, Ohanian said that he always aims to do things that “make the world suck less.” He hopes to one day build a legacy for effective nonprofit work that rivals those of Bill Gates or Warren Buffet (though he’ll need to keep building his fortune to do it). And in the shorter term, he has another big aspiration. “I want to be an awesome Dad,” he told the crowd. Ohanian and his fiancee, tennis star Serena Williams, are expecting their first child this fall.
This is part of the coverage of TIA Singapore 2017, our conference taking place on May 17 and 18.
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