This guy worked 1 hour per day and exited for $575M?
I actively look for interesting companies to write case studies on and spent the last week going through everything public on Plenty of Fish (the dating site). Here are the biggest takeaways that I thought I would share with y’all.
The Numbers
- Launched in the summer of 2003. Sold in the fall of 2015.
- 12 years from idea to exit.
- No outside capital raised
- 2.8 billion page views per month.
- Over 100 million registered accounts at sale.
- 75 staff at the time of the sale.
- Approximately $100 million (est) revenue per year at sale.
- Sold for $575 million to Match Group in 2015.
- Markus Frind (founder) was 36 at the time of the sale, and has since started several other ventures including a winery.
Lessons
1. He wasn’t trying to start a company.
In 2003, Plenty of Fish founder Markus Frind was unemployed after the dot-com crash and wanted Microsoft’s ASP.NET
on his resume. Instead of saying he knew how it worked, he figured why not just build something instead.
It was built in just two weeks with his development expertise and published as a free site (since it wasn’t to start a business). He posted the site to dating forums where people often complained about the sign up fees charged by other sites at the time.
2. Free was the competitive advantage.
Match and eHarmony charged up front before a user could even start to use their site, meaning the funnel failed at step 1. Those who didn’t want to pay automatically were pulled to Plenty of Fish. So really, his competitors were his acquisition strategy because his positioning was free instead of paid for essentially the same services.
Just a few months after introducing the site, Google introduced AdSense which was ultimately what allowed the site to cash flow.
Revenue grew from $1k the first month to over $200k in January 2005 just 18 months after launch. When the monthly revenue hit $4k in October 2003, Markus stopped looking for work.
3. He worked solo for much longer than others I have studied.
From idea in 2003 to 2008 when the site was driving $10 million in annual revenue, Markus ran everything himself. He then hired very slowly and those he did hire were expected to be jacks of all trades.
The interesting thing about Markus was the remarkable understanding of cost. Most other founders I have written about see headcount as growth rather than a quick route to bankruptcy if growth stagnates. Markus solely focused on the revenue per employee.
4. A bias towards action.
Markus has always been a proponent of taking action. He has publicly stated that he would rather try something and fail rather than read a book because the feedback loop is shorter and much more effective for retaining information. Action first, then problem solve for a solution.
5. Leverage a growing company
Markus turned down many offers from Match Group over the years (sometimes they also declined because prices he quoted were often more than 10x annual revenue). He wasn’t holding out for a better price so much as he had no reason to sell. It was just him with nobody to answer to and a company that paid him handsomely each month.
The thing I love most is how he treated doubters. When people called him a liar online when he claimed to be running a free online dating site and making seven figures per year, he uploaded a Google AdSense check for over $900k. Probably the biggest flex IMO.
6. Ruthlessly omit everything not linked to growth
The other thing I found inherently fascinating was the obsession with narrowing the field of view around growth. Markus was famous for working one hour per day. He would walk into his office around noon, walk around and then go home to play video games. What a legend.
In interviews he has said that he focuses on four or five things per year that really move the needle and omits everything else. Being a solo founder and nobody to answer to seriously cut down the time that would otherwise occupy a founder and he didn’t fill it with busywork.
A lesson for some of us workaholics out there.
What’s something you can relate to here? I found the one hour of work per day very interesting given hustle culture and the need to work 24/7 to achieve success. Should we be doing less instead of more?
P.S. If you're like me and want to build a business without sacrificing your life, I write every Thursday about building systems that keep your business running even if you disappear for a 3-month vacation. Join for free here