The Exchanges

Q like, like, 15 or 16 years ago, you guys were on different sides of the country and pursuing very different paths. When, ah, when Mark, you, you reached out to Michael to kind of get back together and build what would become Strava. Why did you reach back out to him? I mean, what, what is it about Michael that, ah, that made you want to work with him again?

A This concept of trust is a word that often gets overused, but not understood. And there's just, he and I had such a long history together and being able to trust someone at a very intimate level, that's hard to define, but it's there. Second is we compliment each other very well. I like to joke that all you have to do is look at our degrees, you know, art history and economics and There's just a yin and a yang to the way in which we think. And the third reason I'll tell you guys that because he's got, he's got the golden touch. Michael's, uh, you know, there's some truth to the simple fact that, um, as long as I've known him, he knows how to make things work. He wins. Michael's, uh, Michael's a very quiet winner, whether it was Kana or Glykofi, good outcomes. And I just give him a lot of credit.

AI assessment note: “he and I had such a long history together and being able to trust”

Q How did you learn about it? What did you, because this is like, you couldn't just go onto Wikipedia. There was no Wikipedia. How did you, how did you even learn what, To do next.

A First off, Guy, I think you're hitting an important nail on the head here, and so in my case, and Michael, what we did, I'll never forget, we did track down a little company. It was called Catapult Entertainment. This was a company, again, mid-nineties that was basically allowing two Nintendo gamers that live in different cities to play and communicate with each other. And they had a part-time, sixteen-year-old kid who was answering customer email for them. And my old roommate was in that company, and he said, hey, you should talk to the sixteen-year-old kid. I think he's actually got a pretty good solution. And so I remember sitting down with him in a local Subway restaurant, and he took a placemat, turned it over, and been sketching sort of what the screen needs to look like, and the screenshots, and how the emails should move, and how you interact with the inbound and the outbound message. And You know, that one fateful meeting, we turned him into a consultant to us. This sixteen-year-old, I think, became perhaps the first consultant we had at Kana. And, you know, we became those experts that you described. It was, you know, you learn pretty quickly. It comes in these funny little chunks.

AI assessment note: “we turned him into a consultant to us. This sixteen-year-old”

Q right, so you have this, so you're all kind of working towards this concept, and it's going to be, I keep saying a social network, and maybe, maybe that's not accurate, but it sounds like that's sort of where it was headed, but I guess something happens in 2008 that there's a breakthrough, right, that kind of changes the way you think about it. What What was it? What happened?

A Yeah. Summer of 2008. We had a group of individuals. I think maybe no more than a half a dozen cyclists on the east coast out in Hanover and another half dozen cyclists that we recruited on the west coast. And Davey had built a, a very basic website and we used to call it the green machine. It was this lovely shade of green that everybody would log into. And we made sure that everybody had Garmin cycling devices and we asked them Through the time of the Tour de France, so over a three week period in July of, would you be willing to upload to this website? And in exchange, we're going to, we're going to create some competitions. We're going to, we're going to put East coast against West coast. We just love to get your feedback and your reactions to this experience of not just going out for a ride, but then sharing that information on this Strava website. And for me, the takeaway was twofold. One was It was clear very quickly that the cyclists who were using it were infatuated by the information they were seeing. Like there was a high level of engagement with this data and the storytelling. Uh, Davey just did this amazing job of taking what was pretty raw GPS information and creating a story for somebody afterwards. Takeaway two was just the level of interaction between these cyclists. Now, I mean, the level of trash talking and gamesmanship and Camaraderie and the competition ba…

AI assessment note: “that experience over three weeks in the summer of 2008 was really the final catalyst”

Q yoga and cycling, all while connecting and sharing with other people In a huge virtual community. Strava's focus on community engagement was inspired in part by how Mark and Michael first met as teammates on their college rowing team. For those who don't know about you or Strava, the two of you started a software company before Strava. How did the two of you meet? Mark, let's start with you.

A Yeah, we, we have to go back to the last century, guy. Um, we're a couple of dinosaurs here. We, we met while in college. Michael is the senior of the two here. I'll point that out. He was, uh, class of 1988, and I was class of 90, uh, at Harvard. We met on the crew team. Uh, we met in the boathouse, uh, which is pretty critical on two fronts. One was just the opportunity to develop that friendship. Uh, he was kind enough. Michael was captain of the team at the time that I joined, and he and some friends really took me under their wing, and And taught me how to row. I was a kid from Reno, Nevada. Uh, not a lot of rowing going on there, so. Learn how to row, and the friendship developed, and frankly then just that experience we had in that boathouse became, uh, really a catalyst for what we'll talk about later with Strava.

AI assessment note: “We, we met while in college... at Harvard. We met on the crew team.”

Q This past year, a lot of people have found routines because they're not traveling, um, they're working from home, and a lot more people have taken up fitness routines. For people who haven't, how, how do you get people to get motivated? Mark, what, what do you suggest?

A Well, I go to, to two basic principles. One is I tell my own story. Which is, uh, it's not, this is not about being fitter or faster or stronger. This is just simply an acknowledgement that when I find even 20 or 30 minutes a day to go do some form of exercise, and again, it can be the walk around the block, uh, I've just found that I'm a better person, guy. I'm a, I'm a better partner, I'm a better coworker, I'm a better parent, uh, and it's just a fundamental principle, and it's been proven by science and everything else, but anecdotally, I need to share that. The second thing I'll say is, To be candid, there's enough people who've decided that fitness can be part of our life that that's, we're really there to help them stay motivated because we believe that not only is it about accountability, but if we want to get other people off the couch, they need to be inspired. And so we know the community we're supporting that's figured this out. They're going to inspire the rest of the world. We could tell you some amazing stories of creativity and innovation from our athletes this, this past year during the pandemic, people running marathons on their balcony. You know, doing what we call Everesting, where you basically go the equivalent of climbing 29,000 feet in their backyard on a little hill, right? It's a, so for us, if we can support those folks, they're telling the story, and…

AI assessment note: “Well, I go to, to two basic principles. One is I tell my own story.”

Q What were some of the ideas you were thinking about at the time?

A A big range. So I, you know, two examples, uh, we were looking at things like headlamps for mountain bikes and, you know, night running and things like that. Didn't go very far for a variety of reasons. But another idea that we were looking at was this simple notion of, you know, my friends and I, who had all been competitive in, in college and in high school, you know, when we graduated, there was this void. In our life. There was this, um, this hole that we felt. Um, I remember, I remember when TA first hired me, my firm, they, they said, oh, you know, one of the things you're going to love being here is you're going to get that same competitive thrill that you got while you were competing and rowing and running.

AI assessment note: “we were looking at things like headlamps for mountain bikes”

Q Mark, are back as CEO now, and Tell me a little bit about, I mean, how, how the, the, the product is being adopted. I mean, is, is it almost entirely just word of mouth? I mean, is it that tribe of cyclists and runners who are telling other cyclists and runners about this and, you know, wanting their friends to be on it so they can share their experiences?

A It is. As simple as it sounds, our, our greatest source of growth are our members. Um, it's been like that from day one, and frankly, despite our efforts to come up with other ways to grow and so forth, and that's not to say we don't have a fantastic marketing team, and there aren't things that we continue to do, but if you look at sort of the core best source of our growth, it's, it's happy members. It's people who are engaged in Strava and are telling their friends, and yes, that was happening in You know, in a typical sort of network-like effect, and particularly a freemium business like ours, um, if you're patient and you have the resources to be patient, the flywheel does start to spin faster and faster and faster, and you could see that in our growth. Uh, just, Michael can tell you how long it took us to get our first million members, and, you know, now we add two million every month, but, uh, I think it took us, what, Michael, eight years to see our first million members? Something, maybe not quite that long, but, uh, not eight years, but it was like three or What was it, Michael?

AI assessment note: “It is. As simple as it sounds, our, our greatest source of growth are our members.”

Q tens of millions of dollars, and those investors at some point want a return on their investment. So you have resisted advertising on the platform, but you've got tens of millions of eyeballs on your app. I mean, you've got a lot of people who use it. Um, how do you resist the pressure to run ads? Because that, that would be an easy way to, to clear some cash.

A It's, uh, we watched Social Dilemma recently, Guy, and, and, you know, this notion of if you're not buying the product, you are the product. And, and I really, we believe deeply in that thesis at Strava. We're, we're convinced that there is a capacity within this FIT community to continue to support Strava and grow this business in a way that our investors are excited about. It's, we've not felt that pressure from the outside. Um, do we believe that there's opportunities for diversifying the kinds of services we offer over the next, you know, again, 1020 years? Of course, but we really are stuck on this principle that you need to understand who your customer is and stay focused there.

AI assessment note: “we've not felt that pressure from the outside”

Q You know, a lot of companies have taken big swings for the fences this past year because they've had to out of necessity. They've had to be radical. Are there any radical things that you've Done this past year that maybe would have been more challenging or more bureaucratic to, to try in previous years?

A Well, I can think of two. One predated the pandemic, and then we faced an interesting sort of question as to whether or not it was appropriate, and that was, uh, some paywall moves. We did some, in essence, some pricing changes, uh, Guy, and it was, it goes back to what Michael alluded to, you know, we'd gone through a rough past in 2019, and we needed to stabilize the business, and we were really thoughtful around, wait a second, if we're gonna dedicate to our athletes and to the subscription business, then let's be transparent But let's do it in a way we believe is scalable long-term. And so in the midst of the pandemic, we shifted the paywall. We, we added 70 new features throughout 2020, but it was not without trepidation, uh, because here we are not just in the middle of a illness and a pandemic, but there's an economic downfall that's taking place and, you know, being very sensitive to, to our own athletes and, and what they're trying to, to go through. So the other I would add is just The way in which we had to allow our team to sort of find their comfort zone, find their space, and whether that was physically, where do they need to be? You know, no longer could we ask them to be in our offices in Denver and San Francisco. We need to let them go where they could find comfort and solace, whether that was family or, you know, just someplace safe and off the grid. Those are…

AI assessment note: “Well, I can think of two... that was, uh, some paywall moves.”

Q started to get anxious, probably, that, because there's a lot, I mean, right, because, you know, you've got the camaraderie of the people around you, and a sense of purpose. You're going to an office, you're, you're having meetings, there's, there's tension, creative tension, but, you know, you're all working towards this goal, and then all of a sudden, like, no, your phone's not ringing. You're not, you're not, right?

A I, I, uh, there was a period that professionally, what I did was I spent a lot of time on boards, and I thought that perhaps that was the next chapter, in the same way Michael described his His academic opportunities is sort of the next chapter. I saw myself as, okay, well perhaps now I can take my experience and apply it across a spectrum of, of board opportunities and so forth. But what I learned was those, I love to equate being on boards to eating junk food and I'll be the first to attest. I like junk food. Like I will occasionally have it. And so, uh, in the moment being at a board, Can feel really good. Uh, you're, you're contributing, you're having interesting intellectual conversations, you're, you're thinking through strategy. The only problem is you leave the board meeting. That's like junk food. It's just not that satisfying. At the end of the day, you're not on that team who's going in now executing all these ideas that you discussed. And it served its purpose for those four or five years that we were basically trying to stabilize our family and get everybody back and healthy and This is, this was the time I, I ended up, Lisa and I divorced in 2005, so we had to go through that period and that chapter in our life as well. So between the health issues and the, just the family dynamics, board service was a great way for me to keep my finger on the pulse of what was go…

AI assessment note: “At the end of the day, you're not on that team who's going in now executing”

Q Yeah. Alright, here's a question for both of you. It's the mid-eighties, you are in Massachusetts, and then you're getting in a freezing cold boat in a freezing cold river. Tell me, what was attractive about that to you?

A You know, guy, I, I often refer back to the time spent on the water in the boathouse. I mean, that was my education at Harvard without question, the life lessons there. And I remember being out on a, on a long row. So this was supposed to be just a call at 45 minutes along the water where we're all supposed to be pulling at a relatively easy cadence and working on our endurance. And the boat was just rocking back and forth. We had no rhythm whatsoever. It just was miserable. And this was at a time where we were just starting to experiment with heart rate monitors. So early days, again, late eighties. And so we're all wearing them. And the coach actually stops the boat because he can tell we're just, we're miserable. And, uh, he asks each of the rowers, call out your heart rate number right now. Tell me, tell me what your monitor is saying on your wrist. And we kind of go down the boat and one of our top rowers, it was not Michael, by the way, it was somebody else. But, uh, His heart rate was like 40 beats higher than everybody else. He clearly was working way harder. And, you know, he was trying to pull hard. He was trying to do what he thought was right. But just the fact that he was actually working harder than everybody else completely threw off our entire system and the sort of the rhythm that we had. And as soon as we got him to just actually relax and calm down, that boat…

AI assessment note: “that was my education at Harvard without question, the life lessons there.”