Last Friday I had the opportunity to interview three entrepreneurs who have created billion dollar companies at the Venture Madness investor event in Phoenix: Justin Kan, Steve Huffman and Daniel Kan.
Justin, Steve and Daniel have each created companies worth over a billion dollars in Silicon Valley. They are close friends who have worked together on previous ventures. Justin and Daniel are brothers; they call Steve their “honorary brother.”
Justin Kan was one of the founders of justin.tv, a pre-YouTube live-streaming video service which later morphed into Twitch, the video game live-streaming and “e-sports” leader. Twitch was acquired by Amazon for nearly $1 billion in 2014. Justin then joined the Silicon Valley mega-incubator Y Combinator as a partner for three years. He just left Y Combinator to focus on several of his own startups.
Steve Huffman co-founded Reddit in 2005, which he sold and left in 2010. He started the travel deal website Hipmunk, which he sold to Concur in 2016. Steve returned as Reddit’s CEO in 2015 amid turmoil and controversy at the company. Reddit is the addictive and popular news aggregator, social rating and discussion website that attracts 250 million visitors a month and is the 19th most-visited website on the internet. Yep, top 20 ON THE ENTIRE INTERNET.
Daniel Kan worked at justin.tv and several other Silicon Valley startups. In 2013, Daniel co-founded Cruise Automation with the former Twitch CEO, Kyle Vogt. Cruise Automation develops inexpensive software and hardware to control autonomous vehicles (self-driving cars). The 40-employee company was acquired by General Motors for over a billion dollars in 2016 to help them move faster in the race to deliver self-driving cars.
Pretty crazy, right? That’s a lot going on for these three early thirty-something programmers in t-shirts. They each created very different billion-dollar businesses, and they don’t show any signs of slowing down.
They are all wicked smart, crazy hardworking and ambitious as hell. And nice too, while hanging out with them and interviewing them in front of 200 Arizona entrepreneurs. They couldn’t have been more gracious to me and everyone there. We hung out for more than an hour before the on-stage discussion.
We discussed their current projects, the Arizona startup scene and fun stuff they like to do. And enjoyed lotsa laughs. My 22-year old entrepreneur-engineer son in Silicon Valley asked me, “Dad, do you even know how sick that was that you were hanging out with these guys?” Yes I do.
Here’s what was most interesting about these guys. They aren’t just passionate entrepreneurs who can code. That was part of it, but it would be wrong to call these Silicon Valley disruptors only technologists or startup wizards.
They are business disruptors first and technology creators second. They go after disruptive billion-dollar global opportunities to create big, new businesses that change the world and create massive value in new companies. If it isn’t a big business opportunity, they don’t go after it.
- I listened at breakfast as Justin grilled Venture Madness chairman Gabe Hyams about his fast-growing “body tissue graft” company, Pinnacle Transplant. It wasn’t a technology conversation, it was a business conversation. How does that industry work? Who are the players? Why isn’t there consolidation in the distribution? Who has the data? What’s the future? How is it regulated? Where is the leverage? What’s the cost of goods on the tissues?
- Steve didn’t talk about the Reddit technology. He talked about his business doubling in revenue in 18 months with a savvy advertising model that is growing. He talked about Reddit’s impact on the election and the media business, Internet trolls, fake news and free speech. The impact of and opportunities for a 12-year-old website with 100% user-generated content.
- Daniel couldn’t give any details about his technology as an executive in a wholly owned subsidiary of a public company (GM). But he did talk about how autonomous vehicles (not just self-driving cars, think drones or food-delivery robots) will change just about every business, including the auto business.
Cutting edge technology and new business models are just the tools — the weapons — used to disrupt massive industries and change the way people do things.
Software businesses are no longer trying to automate or digitize what we used to do on paper. They are changing our behaviors and our businesses altogether, leaving established companies in the dust.
- Are you using technology to improve your established business model (defense) or create a new business model (offense)?
- How is your business using technology to create new business models that will disrupt your existing industry?
- How can upstarts disrupt your business and change the game on you?