Messenger: Seth Epstein, Co-Founder and CEO SocialStay, former Founder and CEO of FUEL (acquired by Razorfish), Emmy winner for work on X-Games and re-brander of ESPN’s Sport’s Center. Seth attended UCSB but dropped out to start a denim company.
Value Prop Twitter Style: SocialStay is:"An easy to set up & manage mobile platform designed for the hospitality industry. It drives revenue & engages guests."
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10) Seth, why does the world need SocialStay?
“SocialStay gives guests more… more access, more freedom, more pleasure, more connection, more savings, more say…”
9) You guys have done an impressive job getting traction with a number of boutique, high-end hotel chains. What will you have to do differently to jump the proverbial “chasm” and appeal to more mainstream, bread-and-butter hoteliers?
“We have built SocialStay for scale so I think the ‘chasm’ is both a function of time and sales. We are focused on low friction adoption, meaning we don’t make it difficult to adopt for hotels and venues. Month by month, the hospitality business is sorting out how mobile plays a role in increasing revenue and driving loyalty. They are starting to see the light. We’re positioned well to scale.”
8 ) SocialStay is effectively a B-to-B, SaaS product that requires you to simultaneously speak to several audiences (hotels, travelers, travel sites, etc.). To what extent have you been able to leverage your experiences as a brand marketer to effectively address the differing concerns of these constituents, without utterly confusing your message? Do you ever find yourself wishing you were 20-years old again, selling high-end jeans to a conscribed set of retailers?
“Yes, it’s harder to target, 2 targets… need 2 bullets. The key for us was realizing our primary client is the hotel management. We need a clean shot with one bullet. Without their buy in, we don’t get the opportunity to interact with end customers. We remind ourselves of that regularly.
My brand marketing experience is making a big difference with our audiences since hospitality is all about a ‘brand experience’ and they want their stuff to look great, be a reflection of their brand and get customers excited. Great design/ user experience carries more and more weight these days and I have been lucky to touch some of the world’s most visible brands. I was having a meal with a friend who works at Apple – and I learned that Apple is ‘run’ by the creatives – run on gut, on quality on a commitment for amazing design and user experience. We subscribe to the same philosophy.”
7) My hat is off to you with respect to the degree you have bootstrapped SocialStay. Your team operates out of a barn on your idyllic, coastal property, yet you have created a world-class product. Do you have any advice for emerging entrepreneurs regarding how they can be frugal without compromising their company’s value prop?
“Yeah, I have made plenty of mistakes in this category in the past. I overspent on stuff that didn’t matter or that I thought mattered. The only thing that matters is getting the product (in prototype, cardboard, concept, wireframes...any workable form) in front of real clients as soon as possible. Technically you don’t need business cards really. You don’t need much… But what you do need is sales. Bootstrapping requires that the entrepreneur go out and talk to their users or clients. The other thing would be to be CLEAR on legal structures, partnerships, etc… to the degree you can. In the beginning, when there is nothing, it’s easy to make promises or throw around equity. Write it down…. There’s a lot more on this for another time.”
6) Your Company’s success squarely resides on consumers’ willingness to trade personal data for enhanced services and discounts. Do you believe non-native Internet users (ages 35 and up) will migrate toward such a tradeoff, or do you think the unwillingness of older users to share private information is relatively intractable?
“I have found that trying to change someone’s fundamental behavior or wiring is like expecting a shark to change into a dolphin –but it probably ain’t gonna’ happen. Users who will not trade personal info will remain unwilling. And, more and more people are comfortable every day. We changed our sign in process altogether actually to address this…”
5) As an investor, I frankly find it tiresome the degree to which entrepreneurs attempt to hype their companies by integrating “social networks and social media” into their pitches.
However, in the case of SocialStay, it is not hype. To what extent does all the “social” noise and excitement help or hurt your ability to tell SocialStay’s story to potential investors and partners?
““Social noise is not a bad thing at all though our name leads some potential clients to think that we are something to do with social networking vs. mobile. Social is not a hype movement; it is part of the web’s DNA. Data, social and location are all becoming foundational to the web. Question is, ‘How is it used?’ SocialStay is a bridge between mobile and social for our clients… it’s designed that way. It’s very practical on an everyday basis.”
4) I have written a lot about the importance of addVisors during a startup’s early days. You have pulled together an impressive array of addVisors into your orbit, including Jeff Jacobsfrom Harpo, Brian Donahoo from AppFolio and Lex Sisney from Commission Junction. What advice do you have for an emerging entrepreneur who is in the midst of building an addVisor team?
“Jeff and Brian are informal and very generous with ideas, input and feedback when they have time. Lex is a great thinker and has a different cut on business I really appreciate and find practical. He is my week-by-week advisor and it’s a more formal structure.
When I was running FUEL, I really did not have advisors – I did have a coach the entire time, who was a sounding board, but we worked on more esoteric concepts like ‘creating space’ (much longer convo) and on interpersonal relations and how to inspire growth, etc… That worked.
I think it takes emotional maturity that I did not have while building FUEL to be able to synthesize information from advisors take the coaching. A good leader synthesizes and forms his or her own style. There are just too many things happening too quickly to have to learn it. If someone has traveled it before, it makes sense to listen, even if you choose a different path.
AddVisors can be formal or informal. Ingredient #1 is that there is a mutual connection of some kind. I could go on and on about this since there can be downsides as well. I look for people I admire and that have experience divergent from my own, who have traveled the path ahead of me… Also, AddVisors ideally have a network of relationships that can help the company.”
3) SocialStay seems to have broad applicability outside of the hospitality space. How do you manage your entrepreneurial desire to explore new opportunities while ensuring proper focus on your initial, core market ? In your weaker moments, what industries taunt you for further exploration?
“I learned early on in the TV business to focus, focus, focus, focus… probably because I am so ADD with ideas and possibilities. I chose to focus originally because I wanted to prove, beyond a shadow of a doubt that I could kick ass in one thing…. Show mastery. I had failed previously by being too spread thin. Staying focused took a lot of self-control… takes a lot of self control. Grass is always greener…. Focus and excellence are always rewarded in the marketplace. The most immediate and natural extension for us is conferences since our solution fits perfectly for that industry.”
2) I remember one time I was eating lunch in Atlanta and a group of guys at the table next to me were talking about how great GoToMyPC was . Eavesdropping on this seemingly insignificant conversation convinced me that we had “made it” – people outside of our family and friends were singing our praises half-way across the country. What do you think will be the tipping point for SocialStay where you wake up and say to yourself, “We freakin’ did it.”?
“We created ‘markers’ for ourselves… number of accounts, number of articles a year, revenue numbers… Starting with markers is a good thing but ultimately, I suppose when a brand is a highly profitable and respected within its industry as the leader or at least the top 3… that could be considered success. I guess I will have to sit in the Atlanta airport and listen to truly know 8).”
1) I know that you guys are in the midst of a funding round and are hiring. What positions are you looking to fill and how can prospective employees and investors get in touch with you?
“[email protected] is the best way to be in touch. Positions range from sales, tech, producers, etc…. constantly looking and interviewing.”
Liftoff: Rapid fire answers to various irrelevant questions:
Invisibility or mind reading? “Mind Reading --- good skill for a CEO… kinda got to act like you a mind reader anyways when building a co.”
Droid or iPhone? “iPhone for design, Android for being a more democratic platform. I have both now and android is great but simply not as sexy or easy…Design wins this one.”
Magic Johnson or Larry Bird? “ The smile or the ugly dude? (sorry Larry) – Magic cuz of his post career work. Not so sure what Mr. Bird is up to. Both men of amazing will.”
Cowboy or Indian? “Indian by a mile. Admire the native connection with land and spirit… and my wife is part American Indian…. I think she’s hot”
Mary Ann or Ginger? “Mary Ann was very J.Crew before there was a J.Crew…. I go for the cute ones vs. the saucier ones….so Mary Ann”
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John Greathouse has held a number of senior executive positions with successful startups during the past fifteen years, spearheading transactions which generated more than $350 million of shareholder value, including an IPO and a multi-hundred-million-dollar acquisition.
John is a CPA and holds an M.B.A. from the Wharton School. He is a member of the University of California at Santa Barbara’s Faculty where he teaches several entrepreneurial courses.
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