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What We Learned From The Founder Of Draw Something

When Dan Porter started his second company he had every intention of building a massive business and getting rich. In 2013, after creating one of the most viral mobile games on the planet he achieved his goal and sold his business to Zynga for $183 million. And now he plans to go even bigger with his new company Overtime.

We got a chance to hear him speak last week to a small group of entrepreneurs that Sergei works with at the eLab at NYU, and we were inspired to share some of the insights and wisdom that Dan bestowed on us during his 60 minute conversation with the group.

In this episode you will learn:

  1. How to compete with massive established companies and win
  2. How to make products designed for a niche group, mainstream
  3. The importance of relationships and how to cultivate them

Show Notes

5:14 The three main takeaways from this episode are
1) How to compete with massive companies. Price is only one way to compete, and it’s not the best way.
2) How to make a niche product appeal to a broader audience. Dan has done this successfully and has made $100s of Millions doing it.
3) The importance of nurturing long term relationships.

5:57 Dan Porter is from Brooklyn and started off being a teacher. This led him to then joining the national non-profit Teach for America as an early employee.

6:19 He rose through the ranks to become President of the organization by creating an ability to scale hiring the top teachers, and helping make teaching in high-need areas a prestigious job.

6:43 At 30 years old he grew tired of being poor, and decided to get into investment banking to learn about business.

7:45 At the height of the dot com bubble he decided to start a company in the online ticketing industry. He wanted to compete with the monopoly that Ticket Master had created.

8:30 And he decided that he would only be able to compete by focusing on a very niche market and dominating it. So he focused on San Francisco. And only smaller venues.

9:02 He couldn’t compete with TicketMaster because they could basically go to a venue like Madison Square Garden and pay them millions of dollars to secure an exclusive license to sell tickets for them.

9:47 So they just focused on SF and smaller venues that TicketMaster were ignoring, but they also became very good at PR and kept getting article published saying they were going after Ticket Master’s business.

10:10 By pinning themselves against TicketMaster over the years, they ended up getting acquired by them just to buy them out of the market.

11:05 So one way that startup can compete with a big player in the space is by being able to move faster in cornering one part of the market that the competitor is ignoring or is too slow to move in to.

12:54 For his next venture, Dan saw a gap in the gaming market and started designing games with a few cofounders.

13:07 And much like in our previous episode about stumbling into greatness, Dan didn’t see immediately what his gaming company would turn into.

13:12 But like with every great idea, he had an insight into the market that helped him differentiate.
The insight was that all games were designed for hardcore gamers who were obsessed with game mechanics and having levels etc.

13:40 Dan saw that since mobile phones were being used to communicate, why not have games be interactive and multi-player? One of the only games in the market that did this at the time was Words With Friends, so he took a similar idea to pictionairy and designed Draw Something.

15:12 Because this was one of the few mobile games at the time that let you play with your friends, it grew very quickly.

15:26 They grew so quickly that the creator of Words With Friends, Zynga, bought them for $200 Million.

15:51 He also went about distribution in a very smart way.

15:58 One of his marketing strategies was to go to colleges and universities to spread the word about the game. But instead of going to the biggest schools where it was harder to stand out, he went to small liberal arts colleges where he could penetrate an entire campus very quickly, and with no competition for attention.

He calls it “starting with smaller unloved markets.”

17:21 Now Dan is doing the same thing with his new company Overtime, taking a concept that had relatively narrow appeal, and making it attractive to a broader market.

17:31 His insight was that young people are not really watching traditional sports, but he noticed that on Instagram there was this growing group of high school athlete influencers who were getting huge followings doing tricks during games. He realized that this is the new way that young people would want to consume sports.

18:08 So he scouted some of the best high school players across the country, recorded videos of them doing cool moves, and focused on only marketing this content on one platform, Instagram.

19:03 Again he took this relatively niche concept, and by packaging it in a new way, made it broadly applicable to others. Since the big sports networks are ignoring this market, this gives him room to grow his company to a point where the bigger players will want to acquire his business later on just to access the younger demographic.

20:08 The last thing that stood out from the talk that Dan gave is how he thinks about relationships. He sees some of the most valuable relationships as a long game. You can’t think of relationships as a transactional thing. You should prioritize adding value over a long period of time, and maybe something will come back to benefit you.

20:56 One thing Dan encourages is updating people that he wants to keep in his orbit through monthly or quarterly updates.

21:14 He told us a story of how he sent monthly updates for 5 years over 60 emails to Marc Andreesen of A16Z, without ever hearing back to him. Until one day 5 years later he replied saying he was excited about the progress that Dan was making, and he has been quietly following him for years reading his updates.

22:10 So any supporters you meet, investors, advisors etc., keep them in the loop.

22:28 Even at this stage of his career he still does this. He once met an executive at Disney, and even know he doesn’t now if they could ever do anything together, he’s going to keep that person updated in case he might be interested in working together down the line.

23:18 And when you read about companies acquiring others, in most cases this happens over years of relationship building until an opportunity presents itself. It’s all about the long game.

Relationships are all about the long game.

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