Alexia Tsotsis works for TechCrunch as a writer. She attended the University of Southern California in Los Angeles, CA, majoring in Writing and Art, and moved to New York City shortly after graduation to work in the Media industry.
After four years of living in New York and attending courses at New York University, she returned to Los Angeles... → Learn More
This is Alexia Tsotsis from TechCrunch and I'm here backstage with Phil Libin and you just came out of panel or not a panel, a talk called Ever the anti-Zynga.
Yes. Yes. That's your guy's headline not mine. So, I think that's something that I I said in passing to Sarah a couple months ago, and I guess it just kind of stuck.
You guys are the anti-Zynga because, unlike Zynga where the goal is to get someone to, for lack of a better word, waste five minutes of their life people to stay?
I think we're more like the complement to Zynga. Zynga's a great company. I wasted a lot of time on other products, and everyone loves to to kill some time once in a while, but you're it. We said if you want a diversion. If you want to kill time that we would think that's kind of big, coolest place to do it and if you want to get something done you want to be productive, if you want to feel like you accomplish something, we want Evernote to be the place to do that.
So we kind of want to be the other half of your life, the productive half.
So it'll all even out at the end of your day.
Exactly.
The time that you waste on Zynga games will be replaced by Evernote.
You can sort of spend a lot of time with Zynga games and then you can do your penance in Evernote by actually being productive and making up for lost time.
So a lot...what's interesting about you being here in Beijing is last time I heard you talk, you were talking about building a hundred year old company. And you were...you brought up the idea of companies in China and Japan that were hundreds of years old or in that range.
Yeah. And you want...unlike what Sarah said, the people who get on stage and say that they want to build a hundred year old company, you actually do. Well, I can't speak for the people, but we certainly do. Yeah. The whole idea behind Evernote was we wanted to be forever. We wanted to be the company that we keep.
So the first two companies we made, we sold. so, we sort of felt like we build them for somebody else that we've said. Okay, the third one is is the one for us. So, from the beginning, we don't want to strategy. We don't want to sell it. We don't want to think about any of that stuff. What's planned is a really long term play so that we can make it a place of you would want to work for the next hundred years.
We recorded that you were raising a round of around 50 million which closed, right?
Yeah, a while ago now.
A while ago?
I think you guys reported it as closed, yeah.
Between 300 million to a billion in valuation. Were they closer to a billion or 300 million?
That's a good range. Let's kind of leave it at that, but we weren't' pacing the high evaluations as we talked about with Sarah and you know, the evaluations actually investors of this close item.
So, you're not looking for a buyer to pay you a billion. You want to see this through and so, that's the other part, whatever.
Yeah. We wouldn't sell the company a billion, 2 billion. There's basically no price that we would sell it. There isn't a price at which I would prefer to sell the whole company rather than, you know like 10% of it at the same evaluation. So, if somebody came to me tomorrow and said, Yeah. I'll give you $10 billion for revenue.
I will go to investors and say you guys give me a $10 billion evaluation. So, the 10% of that amount. They would say yes. I would be much happier to sell 10% than to sell the whole thing. So, as long as the secondary markets allow or the public markets allow us to have the right kind of evaluation then there's really no reason to sell and I think that's an almost.
That might just be a permanent state.
So, what are your top 5 tips for entrepreneurs that don't want to flip, that do want that 100-year-old Evernote or another company that's 100 years old, Sony.
No, not Sony.
Who's 100 years years old. I don't think it's 100 years.
The BMS. You know, several companies in Japan. The one that really inspired us. was where there were actually several companies in Japan that, you know, that are past that agent and they're still, you know, they're still going and that one of our partners is a company in Japan called Uchida Yoko and they were, I think, 101 and they have this really awesome display when you go into their lobby of their building.
We have this museum. It's kind of a circular room and you sort of stand in the middle of it and there's years going down. You know, each column and you can see the entire hundred years of their history, you know, samples of their products and everything for a hundred years and that takes up half of the room and then the other half is empty.
So, it's like for the next hundred years and it's great. It's sort of. It was amazing to stand there and see this company is good for a hundred years with a consistent vision and their vision is to go 100 more and they sort of left room to do it and those are great. So, I basically said I want to do the exact same thing, rip off that idea.
So, maybe 5 is much, 3 pieces of advise. for entrepreneurs and maybe like some extra who have this grand vision and aren't looking to, you know, head up Google for some Sure.
Some porsche cash.
Well So, Porsche cash.
Porsche cash.
I think. Maybe I think the most important one is you got to be doing what you love doing because if you're not completely infatuated with the idea with the company, why would you want to spend a hundred years, you know, doing it. So If you're going to attempt something like this, it's got to be in the field that you feel you can devote the rest of your life too, which is just a good idea anyway whether you want to do it for a hundred years or not Seriously. So, I guess the first thing is do something that you can devote the rest of your life too. I guess the second one is to make sure that all of your investors see it the same way.
It's true because they'll get. I mean they'll start pressuring you.
Yeah.
To sell sooner or...
That's right.
...at all.
And if, you know, if you chase the highest possible valuation, if you get the most, you know...if your goal is to get the craziest possible person to pay you the most amount of money for your company, you can do that and you can maximize some short term gain, but then you'll have a crazy person, you know, on your board.
And that's not going to be consistent for being around for a hundred years. So, you know, you've got to make sure that you have...make sure you have fully aligned interest with the investors that they're along for the ride.
And you should be up front while raising, "Hey, we want this to stick around."
Absolutely. Absolutely. And the best, you know, VC's and investors will love that. They'll be fully comfortable with it. But not everyone will. And so that's a big thing. And then I guess, you know, you got to surround yourself with people who you can spend the next hundred years with. Which is tough.
But that's the hardest thing, right? It's all about getting the team. So the whole secret of Evernote is we have this fantastic team. Many of the people I've been with for 10, 15, 20 years. Others are new obviously and they can do all the work and I don't have to do a whole lot and makes it a lot easier to actually think about continuing this for a hundred years.
I've got other people doing all the hard stuff. Who do consider a competitor? Is is Dropbox?
Well, certainly not Dropbox. Dropbox is a great company and lots of people that I know use Dropbox. I use Dropbox myself people have Dropbox has ever known. There are also quite companies, you know, certainly not competitors. I think Dropbox is the world's best, you know, file system. We really don't see ourselves as being primarily about storage.
We see ourselves much more capture and search and context and retrieval. But there's certainly lots of other competitors, but we don't really, you know, we don't think about them. That's one of the things that we supposedly decided not to do whatever notice is about competition because it doesn't do you any good worrying about them, you know.
The only way you can beat them is to have a better product, and it's not like we need their ideas about how to make a better product. So, any time that you waste worrying who's behind you, you're not making the best product. So, we sort of explicitly have a rule where we don't know who the competition is.
We don't know what they're doing. We don't really care. And so far, so good. Somebody may come along and kill us, frankly, but they're actually less likely to do that. They would be more likely to do that if we, you know, stopped and looked back and sort of agonizing about who's going to do it.
I mean a lot can happen in a hundred years, right?
A lot can happen in a hundred years.
We caught up with Evernote’sPhil Libin after his talk at TechCrunch Disrupt Beijing and delved deeper into a theme that he’s touched upon many times when describing his vision of Evernote’s future — the idea of building a hundred year old company in the age of the acqui-hire and the quick flip.
“We wouldn’t sell it for a billion, or for 2 billion,” Libin told me. “There’s basically no price that we would sell it. There isn’t a price at which I would prefer to sell the whole company rather than, you know like 10% of it at the same evaluation. So, if somebody came to me tomorrow and said, ‘Yeah. I’ll give you $10 billion. I’d go to investors and say ‘You guys give me a $10 billion evaluation and 10% of that amount.’ I would be much happier to sell 10% than to sell the whole thing. So, as long as the secondary markets or the public markets allow us to have the right kind of valuation then there’s really no reason to sell.”
Libin went on to drop his top three tips for building a hundred year old company:
1. Do something that you love enough to devote the rest of your life to.
“If you’re not completely infatuated with the idea with the company, why would you want to spend a hundred years doing it? So If you’re going to attempt something like this, it’s got to be in the field that you feel you can devote the rest of your life too, which is just a good idea anyway whether you want to do it for a hundred years or not.”
2. Make sure that all of your investors feel the same way.
“If your goal is to get the craziest possible person to pay you the most amount of money for your company, you can do that and you can maximize some short-term gain, but then you’ll have a crazy person on your board. And that’s not going to be consistent for being around for a hundred years. You’ve got to make sure you have fully aligned interest with the investors — That they’re along for the ride. And you should be up front while raising, ‘Hey, we want this to stick around.’”
3. Surround yourself with people you want to spend the next hundred years with.
“It’s all about getting the team. So the whole secret of Evernote is we have this fantastic team. Many of the people I’ve been with for 10, 15, 20 years. Others are new. The first two companies we made, we sold. We sort of felt like we build them for somebody else. Then we said, ‘Okay, the third one is the one for us.’”
Evernote just this summer raised another $50 million+ smackers to stick it out through the next century. Good luck Phil!
Evernote allows users to capture, organize, and find information across multiple platforms. Users can take notes, clip webpages, snap photos using their mobile phones, create to-dos, and record audio. All data is synchronized with the Evernote web service and made available to clients on Windows, Mac, Web, and mobile devices. Additionally, the Evernote web service performs image recognition on all incoming notes, making printed or handwritten text found within images searchable.
Phil Libin the CEO of Evernote. He is an entrepreneur and executive who has led two Internet companies from the very beginning to proven commercial success, and helped three others through rapid growth. Prior to joining Evernote, Phil founded and served as president of CoreStreet, currently one of the top companies providing smart credential and identity management technologies to governments and large corporations throughout the world. Previously, Phil was founder and CEO of Engine 5, a leading Boston-based Internet...
