Year One Labs

This is the first in a series of interview posts we’ll be doing with our Mentors. The goal is to introduce you to mentors individually, and help you understand their experience and how valuable they’ll be to Year One Labs. Our first interview is with Luc Levesque, who is currently General Manager at TripAdvisor / Expedia. He got there by selling his company TravelPod. It’s a great story of entrepreneurship, timing and riding the proverbial rollercoaster.

We’d strongly encourage you to follow Luc (@luclevesque) and read his blog: http://luclevesque.com.

1. What’s your entrepreneurial background? Please provide a quick summary.

I come from an entrepreneurial family. My parents, uncles, aunts and cousins have all run businesses. My personal background is in computer engineering. I’ve always loved building stuff. When I was growing up, I was lucky enough to get the hand-me-down PCs that my father’s businesses didn’t need anymore. I used those PCs to learn how to program, build services ( remember BBSes? ) and I have been building software based products and services ever since.

2. Can you provide a bit of history on TravelPod? Why you started it? How you got started? How you exited? What that was like?

I started TravelPod in 1997; it was originally an experiment. I was working for an Internet Service Provider in Ottawa and started teaching myself Web programming on the side. I had planned a backpacking trip to Europe and heard about these “cyber cafes” popping up everywhere. Apparently you could access the Internet from the road using these cafes. That was pretty revolutionary at the time.

So, I built a basic one-page site that I could access from cyber cafes while I traveled. Rather than emailing my travel experiences back home in bulk emails, I’d update the site and the site would email my friends and family a notification that I’d added an entry as I traveled.

Basically, it was a blog, before blogs.

It was an ugly site, very basic and text only ( digital cameras were still $3k+ a pop back then ). When I arrived back home after my trip, I was amazed by the reaction I received from my followers. They were all amazed at how cool it was that they could follow along on my trip as I traveled. Thinking back now, it’s odd to think that such a simple thing was that amazing back then but hey, it was 1997.

Based on that experience, I started building TravelPod as a hobby for other travelers to use. It slowly grew organically through word-of-mouth until in 2003 when Google acquired Blogger.com. That’s when everything changed.

I thought that would be the end for TravelPod but what happened was that Google instantly validated the market. For the first time, TravelPod now had real competition as VCs started investing in other travel blogging companies which were competitive to TravelPod but what also happened is that users began flocking to blogging sites. Blogging was starting to go mainstream. That’s when TravelPod’s growth really took off.

I definitely felt like I had the tiger by the tail. It was time to move the servers out of the basement.

I spent the next few months doing interviews. It seemed like everyone was all of a sudden interested in blogging. The Wall Street Journal, USA Today and even CNN got in on the action and reviewed TravelPod. Blogging was hot.

While the buzz around blogging was at it’s peak, I was scrambling to find additional cheap bandwidth and servers for TravelPod to keep the service up. I’d spend weeks setting up new servers and only a few weeks later TravelPod would reach capacity again and I’d be working on another upgrade to keep TravelPod going for another few weeks.

I was working long hours and wasn’t sleeping very much, juggling a girlfriend who I’d been ignoring severely so that I could work on TravelPod and was running hard to stay ahead of competitors who’d been launching at a fierce pace.

It was absolute madness.

I had two choices. I could shut the servers off, regain a normal life and forget about TravelPod, or I could try to turn it into a business. I chose the latter.

It was at that point that I brought in my uncle Glenn McDougall ( Managing Partner of Doyletech ) who helped me take TravelPod to the next level. Glenn was as passionate about growing businesses as I was about TravelPod. Without his help, I don’t think TravelPod would have been as successful as it ended up being.

The first thing Glenn helped me do is to build a team. We recruited a CEO and a CFO, Martin Horne and Dan McCarthy. Dan and Martin were experts when it came to everything involved with selling companies and I’d hoped that an exit would be in TravelPod’s future so we brought them on.

The team then went on to raise a small angel round and brought in a dozen new employees. Almost everyone was working on TravelPod part-time “on the side” and worked for mostly sweat equity for a frantic year and a half.

During that time we built out more features, tried to monetize the site, grew traffic, and generally invested as much as possible into the product and business until November of 2006 when I received two unsolicited email offers from large Internet companies to acquire TravelPod. It’s a very odd email to get: “We’d like to buy your company” … but I wasn’t complaining.

We then reached out to everyone in the online travel space to see if any other companies were interested in submitting a competing bid and we received a few more offers. Ultimately TripAdvisor ( part of Expedia ) had the best offer and we accepted it.

As wild of a ride that the first 10 years of TravelPod were, the next 3 years within TripAdvisor have been just as exciting.

We couldn’t have picked a better company to join. TripAdvisor has mostly let us operate independently. We’ve launched several awesome products since then ( The Traveler IQ Challenge and TripWow ) and have continued to innovate. I’ve also learned a tremendous amount from everyone at TripAdvisor especially from Steve ( TripAdvisor’s CEO ) who I report to and respect tremendously.

I think of the first 10 years of TravelPod as a great experience building a world class product and the last 3 years as a great experience building a world class business.

I’ve spoken with several CEOs over the years who’ve regretted selling their companies which is a shame. Selling TravelPod has been one of the best decisions I’ve ever made.

3. Any key startup lessons learned from your experience with TravelPod? Anecdotes? Stories?

Great products are important but great marketing is more important. It’s easy to get into the trap of spending time and engineering resources adding features and improving a core product but you need to spend just as much ( if not more ) time thinking about how to excel at how you market your product.

It seems so basic but I think that ultimately, most entrepreneurs want to build awesome products… building awesome marketing sometimes takes the back seat.

Nowadays, the first question I ask entrepreneurs who come to see me for feedback on their ideas is: “How will users discover the product, at scale?” Unless it’s a truly game-changing product, a great product without great marketing likely won’t produce huge returns.

We spent many, many years building what I still think is the best travel blogging site on the web at TravelPod but it wasn’t until after we were acquired that I started spending more time thinking about SEO, viral tactics and other means of user growth that we went from hundreds of thousands of uniques visitors (UVs) per month to millions of UVs per month.

That wasn’t done by improving the product, it was done by improving the marketing.

4. What are your thoughts on the changing landscape of venture capital and investment for startups?

It’s very exciting to think that a small team of talented individuals with a dream can start executing on a business idea without very much capital today.

For good reasons, VCs like to invest locally which makes it hard to raise capital in large sums from most cities that don’t have a large VC presence. Now that large amounts of capital are no longer needed to build a v1 product ( in most cases ), startups that don’t have access to large amounts of capital can still give it a go.

I think we’re going to see much more innovation in the next 10 years than in the last 10 because a small handful of rock-star developers with a passion for an idea can build something awesome.

If that doesn’t get you fired up, I don’t know what will.

5. What are your goals for working with Year One Labs and the startups we bring in?

I wish I had brought on experienced advisors who’d “been there” earlier on at TravelPod. I’ve witnessed many times how much value a small piece of advice from someone who’s “been there” can add. A simple comment from an advisor based on their personal experience can sometimes save months of wasted time and have incredible returns.

It’s my goal to help out other startups at Y1L and to give them some advice I wish I’d had been given.