Monday 18 December 2017

Startups: so hot there's even one to decide which one is the hottest

Keeping track with the frenzied pace of new startups is a dizzying task in its heartland of San Francisco. The answer? A fledgling company run by a 28-year-old who can make or break an idea. We meet Product Hunt founder Ryan Hoover

'A lot of them aren’t going to survive. It's not a bad thing. It’s simply impossible for everything to succeed,' Ryan Hoover says of the new wave of tech startups
'A lot of them aren’t going to survive. It's not a bad thing. It’s simply impossible for everything to succeed,' Ryan Hoover says of the new wave of tech startups

Eric Newcomer

They came by the hundreds, spilling out of Ubers and Lyfts to wait in a line snaking for two blocks from the front door of Jones, a bar in San Francisco's Tenderloin district. A passerby asked if a band was playing.

No, the draws were free beer, Ryan Hoover and Product Hunt, the hot arbiter of the coolness of the hundreds of apps, services and gadgets released in any given month.

More than 3,700 people RSVP'd to an invitation Hoover posted on Facebook for his website's first-anniversary party, a pavement-jamming testament to tech's reign and Hoover's particular brand of celebrity. Hip-hop artist Nasa and New York Knicks forward Carmelo Anthony, both startup investors, are regular Product Hunt readers.

"I haven't seen anything that captures the magic of the times we live in the way Product Hunt does," says Groupon co-founder Andrew Mason, whose new company, the travel guide service Detour, scored a Product Hunt shout-out last year. "It just captures on one page the breadth and depth of entrepreneur innovation that is happening right now."

Hoover, who's 28, is one of the most visible benefactors of the tech boom, an earnest, hustling, unconventional power broker in the let's-create-a-company culture glorified and mocked in TV shows and movies. Products hyped on Hoover's site can expect a boost in sales - and occasionally queries from investors.

Venture capitalists put $48.3bn into US startups last year, the most since 2000, when the last boom was blowing up. Hoover got more than $6m of it. In the past 120 days, he raised the money from VCs like Andreessen Horowitz, hired five employees and has gone from working out of a coffee shop near Twitter to an $8,000-a-month apartment he converted into an Ikea-furnished office.

This month, his company collected the "Best New Startup" honour at the Crunchies, Silicon Valley's annual awards show.

Product Hunt didn't win for its revenue or roadmap to profitability - it doesn't have those. Like many entrepreneurs, Hoover's focused on building an audience and influence. If a money-making enterprise grows from there, great. "I started Product Hunt not expecting it to be a business," he says.

And he's not naive about his access to capital. "In a different environment, when the money was much harder, I'm not sure we'd be able to raise as much," he says.

"It'd be disingenuous for me to say we didn't benefit."

For all its clout, Product Hunt doesn't have a lot of frills. It's a website and email newsletter that every day singles out 50 or so recently-introduced things Hoover, his team and a group of discerning volunteers decide are noteworthy.

Readers "vote up" what they like, moving them higher on the site, where they get more attention. Startups are so hot in Silicon Valley that the industry needs a startup to curate them.

As its following has grown, Product Hunt has become a virtual town square for tech's cheerleaders, with people posting feedback about new products and startup founders like Groupon's Mason answering questions about their latest inventions.

Hoover has guarded who can comment, limiting the number to 8,000 thus far who were brought in through an invitation system. Mason says the biggest challenge for Product Hunt will be ensuring it's not overrun by the internet's default to vitriol.

The products popularised are a microcosm of the startup world. They're often clever, occasionally wacky and mainly appeal to people like Product Hunt's founder - men and women in their 20s and 30s with disposable incomes and check-your- iPhone-200-times-a-day obsessions with technology.

A recent batch of products highlighted include various delivery service for some random items, from cannabis accessories to bacon to underwear.

Among the number of buzzy if indeterminately successful apps Product Hunt has flagged: messaging services Taptalk and Yo; link-sharing app Point; credit-card protection service Final; and work-automation software company Workflow.

Hoover embraces a free-from-cynicism philosophy, and is an unapologetic defender of even the silliest of creations.

One of his personal favourites is an app called Mindie, which can make a 10-second music video to share with friends or, in his case, his mum.

Another that he enjoys, Drake Shake, superimposes a picture of the hip-hop artist Drake in a photo of your choosing.

"People shouldn't be so damn judgmental about people creating things - a silly app is just something fun," Hoover argues.

"'Not everybody is trying to change the world, and part of my frustration is people start complaining that we are spending our time wasting it on things that don't matter when not everything is supposed to matter."

Tall, with blond hair and greenish eyes, he's easily recognised around town by tech workers and aficionados, and by app inventors who buttonhole him. His usual mode of transportation is walking, and he often wears the tech uniform of jeans and a hoodie.

He lives in the Tenderloin, an easy stroll to the Mid-Market tech-land neighbourhood brimming with offices for the likes of Uber Technologies and Square.

Being the toast of the town hasn't unsettled him, he says. "It's somewhat flattering, but it's just different because it's never happened before." But he adds, "I have to be hyper aware about what I do and what I say."

At the anniversary party last month, many guests were aspiring Hoovers, obsessing over their own startups and hoping to have founded one of the few that won't end up failing.

One, Erik Chan, is working on a web platform where people can buy stakes in their favourite products. Another, Sydney Lai, holds the job title "Startup Evangelist" at F50, which helps new companies connect with potential investors.

Some asked Hoover to pose for pictures.

"I'm going to make this into a poster," said Nick Haase, the founder of the brand-marketing app Loot, half-jokingly.

A week earlier, at an office-warming party, former Microsoft executive Steven Sinofsky served as the photographer, snapping pictures as Hoover mingled and his guests drank beer and ate pizza.

"Any new company in the early stage success is going to be a product of the founders themselves," says Sinofsky, who's on the Product Hunt board and a partner at Andreessen Horowitz.

"The idea for Product Hunt is a natural evolution of Ryan himself."

Growing up in Eugene, Oregon, Hoover was captivated by computers and film-making. He and his friends made horror movies, sometimes starring his kid brother; they'd sneak into his room to scare him, and tape it. His parents ran a video-game store when he was young, and now own a recycling company.

With a business degree from the University of Oregon, Hoover moved to San Francisco to build developer tools for the video-game company Playhaven.

He says he stayed about three years, quitting when he tired of the work. With some savings but not much of a plan, he blogged about tech and introduced himself to people he admired, such as investor Paul Graham and news aggregator Digg co-founder Kevin Rose.

The youngster had an itch to start something of his own. "His dad would always say to find a niche and fill it," his mother Shari Hoover says.

"Ryan would always try to think of something that was new and creative so somebody else would want it."

What the tech world needed, he concluded, was a central appraisal hub for the stream of apps and other products. He started with the newsletter, making the picks himself, and pulled in his first round of financing last year. He declines to disclose his salary, but says Sinofsky set the sum for him.

Product Hunt's success story could have a lot to do with Hoover's energy and networking dexterity.

He wakes up at 5.30am to scour the web for worthy items. The browser on his Macbook Pro often has 20-plus tabs open, and there are more than 300 apps on his black iPhone 6.

He seems to be constantly texting, emailing, blogging, podcasting or posting comments on the site. He writes thank-you notes - on paper - to readers.

"I didn't think this guy was as well connected as he is," says Or Arbel, co-founder of the one-word messaging app Yo. "I found out that Ryan was one of the most connected people in the community."

Arbel credits Product Hunt with some of the app's overnight attention. A post about Yo popped up on Product Hunt nine months ago, an online discussion of its merits ensued and before long, Yo was being written about by media outlets and the company raised $1.5m.

While Hoover's a champion of startups, he's fine with the fact that the market will decide whether what Product Hunt determines is worthy will succeed. "A lot of them aren't going to survive," he says. "It's not a bad thing. It's simply impossible for everything to succeed."

Now Hoover says he plans to introduce offshoots for other areas, including music, films and fashion. The first spin-off for video games is likely to be out later this year.

Has it all gone to his head? He laughs about being so tech-famous, and shrugs off the possibility there'll be a backlash against Product Hunt as it grows.

"When a band is unknown, everybody loves them because you can't really hate them, because they are just some people trying to do something cool," he says.

"But when they become popular, they sold out or aren't cool any more. The perception is that it lost some of that allure, even though it's still amazing."

 

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