I’ll admit it right off the bat: Phil Libin (CEO of Evernote) is one of my favorite entrepreneurs. I consider myself an actual “fan” of very few living business men, but he’s one of them.
Phil joined Sarah Lacy on stage today at Disrupt Beijing for a quick fireside chat, and, along with explaining why he plans to stay with Evernote for the long haul, offered up a bit of sage advice for the budding entrepreneurs of the world.
First: design for yourself, and love what you do. While Phil openly admitted that this wasn’t the most original advice, he dived a bit deeper into his logic:
“I’ve had three companies, and it took until the third to figure out some really basic things… My first company [Engine 5] did systems for retailers; we weren’t retailers. My second company [Core Street] built infrastructure for the government sector. With Evernote, we are the end-user. It feels like cheating. If I had to do it all over again, Evernote would be my first company.”
It wouldn’t just be his first company — it’d be his only company. Libin thinks of Evernote as a 100 year company, joking that he guesses he “has to be comfortable with the idea that [he] may not be the CEO in 100 years.” As for why he’s so open about this (and most things, really; Libin is often recognized for his transparency): “Evernote is asking you to trust us. If we’re going to do that, we have to tell you what we plan to do, how the numbers work, and how the technology works. If we didn’t do that, we wouldn’t get the trust we do.”
Next: don’t use crazy bidders to inflate valuations.
“Valuations in private companies are a really strange thing. In the public market, valuations are kind of the average of lows and highs across all sales. With a private company, you really only have one seller: the company. You base your valuation on the highest bidder. You can chase up your valuation by getting some crazy person to bid some insane amount — but then you have a crazy person as your boss.”
Finally: if you’re building a freemium product — as is all the rage these days — focus on the “free”, not the “emium”.
“People tend to highlight the ‘emium’ part. We value the ‘free’ part. The free version of Evernote IS the full product — but as long as you keep using it, the perceived value just keeps going higher and higher.”
In other words: make people fall in love with the free product, and they’ll be all the more willing to give your their money without you even having to ask.