How To Build a "Lifestyle Business" with 30 Million Visitors Per Month: The wikiHow Story

12/16/11Follow @wroush

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twice that of Instructables’, according to Compete.com, and both sites are far outstripped by WikiAnswers and eHow, Demand Media’s how-to juggernaut. But it’s true that wikiHow appeals to a broader audience than Instructables. And its articles are certainly more thorough, and more human, than those at content farm eHow—which, interestingly, Herrick used to own.

And therein lies a story. But before I get to that, I want to rewind all the way to 1991, when Herrick was finishing his B.A. in history at Stanford. He told me the whole tale during a long interview on the front porch of the “WikiHaus” on Emerson Street in Palo Alto, a couple blocks north of University Avenue.

Herrick went straight out of school into a management consulting position. “I didn’t like it and I was really bad at it,” he says. Luckily, at age 23, he discovered rock climbing. “It was one of those random days that changes your life,” he says. He quit his job, emptied out his savings account, squeezed all his possessions into the back of a pickup truck, and moved to Yosemite Valley.

It wasn’t a reckless, Into the Wild-style adventure, but it did shape Herrick as a future entrepreneur. “I was not a good athlete,” he says. “I was kind of a klutz. Also, I was afraid of heights. It was a bad combination. But climbing is one of those sports that rewards effort. It’s also a very cerebral activity—the most important muscle you use is your brain.”

Herrick became so absorbed in the sport that he ended up living out of the pickup for two and a half years. “I climbed Half Dome and El Capitan and ended up trailing all around the Western U.S. and Thailand and Nepal,” he says. “Through that process, I really learned a lot more than I’d been learning in my job. For one thing, you always partner with at least one person when you go after a summit, so I learned how to pick people and recognize talent and determination and shared values. I also learned about what you have to do to accomplish a goal. Climbing is 99 percent misery—it’s a lot of frustration and fear. It’s dehydration in the summer and freezing your ass off in the winter. It’s a lot like entrepreneurship.” In fact, it was during his rock-climbing phase that Herrick would meet the co-founders of two of his four future startups.

And there was one more aspect to this life that would stick with Herrick. To stretch out his savings, he tried to make do on $10 a day, with the exception of travel expenses and books, which he considered off-budget. Herrick marked off an area in the pickup that he called his “knowledge box,” and filled it with a rotating collection of new and used hardcovers and books borrowed from public libraries from California and Utah and Wyoming. “I had spent years at Stanford doing academic learning but for the first time, with my knowledge box, I was learning cooking and rock climbing and doing all of these things,” he says. “That started my interest in lifelong learning.”

Eventually, Herrick put his pitons away and went to business school, at Dartmouth. He went back into management consulting for just long enough to confirm that it wasn’t his scene. By then it was 1999, a good time to start something new, and with Dan Frank, one of his climbing friends from Yosemite, he started an online restaurant supply company called Big Tray. More or less overnight, the company won $10 million in venture funding and acquired 40 employees. “It was the sort of thing that only happened in 1999,” Herrick says. “It was a good story and a bad story. Let’s just say it was the best executive education that $10 million could ever buy.” When the dot-com crash hit in 2001, the company ran out of capital and ended up selling for pennies on the dollar. (Herrick maintains that “if the investors had put a little more cash into it, it would have been a good deal for them. Not the next Amazon, but the next Zappos.”)

Herrick took a year after the sale to do the “decompress, dot-com-bust, travel around the world, climbing-surfing thing” with his girlfriend, who is now his wife. Next came Luminescent Technologies, a UCLA-born semiconductor company. While he was there, he reconnected with another old climbing buddy—Josh Hannah, who was working at the time on sports betting sites Flutter.com and Betfair.com.

For entertainment, Hannah and Herrick “started goofing off with some ideas,” Herrick says. “In the process, we started … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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  • Scott

    Dear fellow entrepreneur,

    There is a huge ecosystem out there that does nothing but move entrepreneurs away from building business that can grow and flourish to crafting empty shells that can be inflated and sold. The big law firms have their “entrepreneur universities” to teach you how to get your company ready for funding. Business plan competitions, local economic development agencies and angle groups all do the same. This entire infrastructure is all aimed at getting you ready to sell (out) your company to VCs. By the time you have twisted and bent your company so many ways you will have changed from focusing on your old customer (the one with the pain that you have an unique solution for) to your new customer (the VC). It is the job of VCs to buy and sell companies, not to build them. And certainly not to solve customer’s problems. That is the reason why VCs have a 90 failure rate (by their standards). Think very carefully about that. If they fail to fund over 90% of business plans that they see and 90% of the businesses fail then why on earth should you bend yourself to their needs. Sure, if they do take the company public then you might get rich, if they haven’t kicked you out and the stock doesn’t tank before you call sell your shares. If getting rich gets you out of bed in the morning then go work for wall street, do not kill yourself building a product into a company.

    There is a radical solution out there. Find a customer with a problem, create a solution you can build with your resources, sell it to the customer at a profit and build a profitable business. That may mean cutting down on the scope of your first product to what you can deliver. Say you want to build an electric car company. That would take billions in VC money. Before you get past your first round of angle funding what ever brilliant insight that you may have had will be crushed by the twisted needs of the VC. Do not go there. If your idea to too large, find a piece of it that you can build and sell with your resources, then make and sell that product to start and build your company from there. That might only be new type of suspension rod in the car example, but if you can make it and sell it for a profit then you build from there.

    You say you are an early stage entrepreneur and not interested in the long haul? No worries. There is always someone there to buy a profitable small business. Rinse and repeat on a larger scale. That is what the whole lean start-up thing is really all about.

    Yes, I guarantee you that the VC infrastructure will laugh at you, but what is wrong with solving problems and creating jobs? Does this sound more like your father’s company or your grand father’s company? I hope so. They built companies that employed our neighbors, paid the taxes that build our infrastructure and educated us. It is time we stand-up and do the same. “Occupy Sand Hill Road” would be a silly exercise. Ignoring distractions is always the best course. What we really need is to occupy main street. Occupy main street not in protest, but in progress.

    Find a problem, create a solution, build the product from your existing resource, sell at a profit and build the company! Only take money from those who love you – friends, family and founders. Listen to your customers and then listen again and then listen some more to your real customers. Take pride not in how many share you have, but in how many people you employ. Be proud, be VC free, be a real entrepreneur.

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