Chess.com

“We're about ten million daily active users, about 40 or fifty million monthly active users.”

“We have more than two hundred fifty million registered members and more revenue than I thought we would end up with as a chess company.”

“And so a friend and I bought the chess.com domain name for 56,000 dollars”

“And so I had a lot of meetings and basically most of them said, this is uninvestable. You should get a real job. Don't waste your time with this. And so I wasn't able to raise any money. No one believed in the vision.”

“We launched in 2007, right as I graduated from school. And then I think within like 18 months, we were starting to charge memberships for like online chess learning, and we pretty quickly became profitable.”

“Obviously Lee Chess exists today. They're kind of the, I would say the Linux of you know, they exist for a really important reason. It's great for the community. It's open source.”

“The interesting thing is chess is like, Not patentable. There's, you know, thousands, if not tens of thousands of chess apps in the app store and chess websites. And you know, at the end of the day, really product is going to win out and community and content.”

“For a pure software and content business like ours you know, and one where we didn't have like, you know, no major tech company was bearing down on us. We were able to kind of take a little bit of the slower, a slower road there which was great developed a gre…”

“Because before, before COVID and Queens Gambit, we had like a million daily active users, and we were shocked at that.”

“I also feel that we've been partly responsible for that, that we've kind of revolutionized what it means to be a chess player. Chess can be in your pocket. You can do it any time. The content is funny and relevant and interesting. And we also just redefined wh…”

“Well, I'll tell you, we're still a bootstrap business because CBC came in, but they still, you know they came in and bought secondary.”

“And so there's really not shortcuts to the process. There are shortcuts in the tools. You know, it's, we've made it, tried to make it as easy as possible to, you know, do your puzzles and to train on your different elements.”

“We spend a lot of time, a lot of money, a lot of resources on anti-cheating basically, and we have a whole set of tools, which I'm not going to get into because I don't like to give ideas to people on how we do it, but we track a lot of stuff. We have more dat…”

“Cheating. It can't be prevented because you can't, you know, you can't put a webcam in every single person's home. But we do do a really good job at catching it and banning people who do that and trying to educate them as well.”

“We recently launched gambit at gambit.com, which is our poker site and you can play gambit on your phone as well, but we're doing poker in a different way too. We're bringing the chess playbook, which is like poker for ratings.”

“And we're going to roll out other games as well. because we like the playbook of what we've done. So we're cooking up a bunch of other classic games. and we're gonna be launching those out there.”

“We literally just did like all the opposite of that. Like I hired my friend from San Jose state. We worked remotely. We didn't raise any money. We didn't pay any money for customer acquisition. We picked a tiny market.”

“I don't know if anybody knows about this, but Peter Thiel has a chess.com account with his real name, under which he's played over 50,000 games over the past 10 years.”

“80% of people that review their games actually do so after a win.”

“That change alone was pretty dramatic for us. It grew game reviews by 25%, subscriptions by 20%, user retention by a lot as well.”

“The PMs are mostly using vZero. The designers love Figma, so they're using Figma Make. The engineers are using a combination of tools right now. So Cursor, Cloud Code, GitHub Copilot. Marketing teams use all sorts of tools for translation, subtitles, you know,…”

“I think probably eighties percent of our Daily or weekly active users. I mean, I'll check the numbers, but something like that would be like a current user or an existing user, and then a new and a like reactivated or resurrected user. Those are actually about…”

“And it's like the growth experimentation is more the slow and steady or fast and steady, I should say approach where you're just continually iterating. You're making the product experience better, but then every so often, right, there's a big wave that comes i…”

“So behind the scenes, we're running chess engines to basically spit out evaluations for every move that you make. And then we translate that and make that approachable to the user using, you know, their native language and plain approachable style. And even wi…”

“So prior to 20, 23, the company practically didn't experiment at all. Last year they did about 50. This year they're On pace for about 250. And then next year we have that ambitious target of a thousand.”

“Over 75% of our new users, they classify themselves as like, I'm completely new to chess or I'm a beginner.”

“Less than a third of those users actually win their first game. And when you lose a game, user retention is 10% worse than when you win a game.”

“Started chess.com in many ways to support the e-commerce business.”

“I mean, I remember maybe in 2017 or 20 18 doing you know, ten million dollars in revenue or something like that.”

“We have been profitable basically since the very beginning.”

“I think I sold the business for a little under two million dollars, something like that. It was actually less than that. It was like one and a half million, if I remember correctly. And then I paid, so after I paid taxes, I had about a million dollars. And the…”

“I, you know, in, in many ways I was happier than I am today because the stress of chess.com today is so much more than it was back then. So, you know, I don't wish a huge success on anyone. It can be quite a burden at times to be totally honest.”

“And we ended up we ended up settling that lawsuit in exchange for two cases of vodka. That's what he wanted. And so no money, just had to ship two cases of vodka. And then he settled the lawsuit.”

“I think people are a little bit Naive about the downsides of raising money. Ultimately your investors will want an exit and it may not be at the same time as you. And for a business that's as mission driven as chess.com is, it's, it has at times been irritatin…”

“Met with a lot of private equity and venture firms. And, you know, most of them passed. They still couldn't see the vision of where chess could go. They still thought they said the same things, you know, the market isn't big enough, et cetera. But, you know, G…”

“Up until about 400 people on our team, We had a kind of everybody was reporting to me in some ways. It was extremely flat company. You know, everybody was emailing me their weekly reports. I was responding to, you know, two, three, 400 emails every weekend.”

“I mean, we've seen many businesses come into chess, having raised millions of dollars and seen them flame out.”

“We're at five million daily active users now, you know, 40, fifty million monthly active users.”

“I think we're ready for twenty million daily active users and a hundred million monthly active users. I think we're ready for that. And I think it's coming.”

“I think a lot of people would look at, you know, single digit growth, like we're going to have this year and say, ah, well, you're not ready to be a public company.”

“But I do think we'll be there one day.”

“We've been growing at the speed of cash. And so we don't have just tons and tons of excess cash.”

“That's why we recently did you know take money, a little bit of cash, and then some secondary from WME and Endeavor which is a large media company, and we're working with them to, you know, look at different ways we can grow the game.”

“We're only really looking for media partnerships at this time, because we believe that while we work on our core business, our top of funnel And new, new users are going to come through media partnerships. And luckily we have some amazing great media partnersh…”

“Interestingly, India is not a top monetizing country for chess.”

“A some ridiculously large number percentage of people in Norway have chess.com on their phone. It's like, it's massive. I don't want to say it's half, but it feels like it's close just because of Magnus Carlsen. And probably 10% of them are paying subscribers”

“Yeah, I mean, I've had death threats.”

“Wait for the TV show next year. You'll, you'll, you'll hear more about it.”

“One thing we tell people who work at chess.com, every single person who gets hired, They hear the same thing, which is chess.com will never be your highest paying job. We're just economically not set up for it.”

“Chess.com is my third chess business, which is totally absurd to say.”

“Everything I saw going on in Silicon Valley was like spend, spend, spend. We did the opposite. We thought about monetizing immediately.”

“56,000 dollars.”

“Ridiculously large role, especially at the beginning and the beginning sets the tone for later. Now, I mean, in today's world, if we hadn't done it, if you, would you have to start on chess.com? Probably not, but given the time that we started and how it worke…”

“When COVID came and the Queen's Gambit hit and our numbers like five X overnight, it grew the game of chess five X.”

“We tried for like the first Five years to raise money. We tried many times. We tried angels. We tried, I met Peter Thiel. I went, I met a bunch of different angels. I went up and down. I used all my connections up and down Silicon, you know, Sand Hill road to …”

“We'd totally been burned on, on paid acquisition, and we pretty much made You know, a very firm rule that we weren't going to do paid acquisition. And so instead we said, we're going to take any money that we have and we're going to put it into content because…”

“We were doing live streaming back when it was justin.tv long before it was Twitch.”

“Our most recent wave was Completely driven off of short forms, whether it's YouTube shorts, Instagram, you know stuff or reels or, you know, TikTok. It is totally driven.”

“It pains me to say this, but somebody who wins their first game of chess is two to three times more likely to stay around than someone who loses their first game.”

“What we're trying to do is push people toward not playing a person first, but knowingly playing a coach bot personality where they will win and feel good But not to just throw them in the pool of players against other people where there's a fifty-fifty chance …”