New York's First Tech Billionaire Reveals Key to Startup Success
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Chapter 1: The Nature of Entrepreneurial Stress
Launching and running a startup is often a demanding and taxing endeavor. However, it’s essential to recognize that not all stress is detrimental. In fact, there's a term for constructive stress: "eustress." This type of stress, as opposed to "distress," can be advantageous for those who experience it.
If I were to make an assumption, I would say that most of the stress entrepreneurs encounter is of the eustress variety. Although creating companies can be draining, many entrepreneurs find joy in the process. It’s the very stress that motivates them each morning, fuels their enthusiasm, and drives their hard work. However, this somewhat masochistic enjoyment of challenging tasks can hinder entrepreneurs from concentrating on what truly matters. Jon Oringer, the founder of Shutterstock, shares this perspective.
Jon established Shutterstock, a multi-billion-dollar stock photography platform, in the early 2000s. As a solo founder, he maintained majority ownership and became New York City's first tech billionaire. He attributes his entrepreneurial success to a crucial yet often overlooked aspect of building companies that many entrepreneurs tend to neglect once they have the means to do so.
Section 1.1: Revolutionizing Stock Photography
Shutterstock may not be the first name that comes to mind when discussing successful tech companies in New York. Typically, you might think of BuzzFeed, Rent the Runway, or WeWork. However, for those frequently in need of high-quality images, Shutterstock's significance is undeniable.
Jon articulated this need eloquently during our conversation: "Images are vital for selling products. Effective marketing relies on visuals. Yet, shooting photos yourself or hiring models can be both time-consuming and costly. On Shutterstock, you can access countless options without the hassle of assembling a team or finding a studio."
Before founding Shutterstock, Jon faced his own frustrations with acquiring images as a serial entrepreneur. He constantly sought high-quality photos for marketing campaigns but found the process of navigating various stock photography services to be both costly and inefficient. Rather than forcing customers to purchase images individually from several platforms, Jon envisioned a subscription model for one comprehensive stock photography website.
The outcome was Shutterstock, pioneering the concept of subscription-based stock photography. As Jon put it: "I aimed to create an engine that enabled businesses to market through subscriptions."
Section 1.2: The Importance of Customer Connection
When Jon launched Shutterstock, many doubted its potential for success. However, he proved them wrong. Remarkably, Shutterstock has remained profitable for nearly two decades, achieving consistent quarterly profits. This success involved immense effort, but Jon emphasizes that one aspect stands out as vital: maintaining direct connections with customers.
In the early stages of a startup, entrepreneurs often wear many hats. As their businesses grow, they begin to delegate responsibilities, often offloading tasks they find unenjoyable. While entrepreneurs thrive on the challenges of product development, marketing strategies, and even negotiating with investors, they frequently dislike handling the repetitive inquiries and complaints associated with customer service.
As Jon explained, "In the early days of Shutterstock, I was the sole customer service representative. I handled subscriptions, complaints, and customer inquiries directly. Those interactions were invaluable."
Many entrepreneurs find customer service to be the least enjoyable aspect of running a business. Not only is it often tedious, but it also involves addressing complaints, which can be draining. Consequently, founders often delegate this role as soon as possible. However, Jon warns that doing so can disconnect them from vital feedback about their product.
He stated, "If you raise $3 million and hire a customer service representative right away, you risk becoming detached from your product's reality. Taking those calls is crucial; it guides your product development in ways that hiring someone else cannot."
According to Jon, engaging directly with customers—especially those who are dissatisfied—is essential for understanding what works and what doesn’t. This insight is critical for enhancing a company’s offerings. Notably, Jon still personally addresses customer service inquiries, emphasizing the importance of staying engaged with customer feedback.
He shared, "Even now, when I see a complaint on Twitter, I respond myself. People often think it’s not me, but it is. Maintaining this connection is vital. There are only so many hours in a day, but if you overlook this aspect from the start, your company is unlikely to thrive."
Jon's commitment to customer service underscores its significance in entrepreneurship. If a billionaire founder prioritizes customer connections to the extent that he still engages with them directly, it’s worth reconsidering any reluctance to embrace customer service in your own startup.
Listen to Jon's entire journey by searching for "Web Masters" on platforms like Apple, Google, Spotify, Stitcher, or your preferred podcast service.