In 2007, Andrew Mason launched a website called The Point. It was an ambitious idea: a platform where people could rally around a cause, from a neighborhood fix to a consumer boycott, and pledge to act only if enough others pledged too. Once a campaign hit its “tipping point,” everyone acted together. Eric Lefkofsky, Mason’s former boss, liked the idea enough to put $1 million into it.

The Point didn’t take off. Campaigns were hard to explain, harder to organize, and most of them never reached their tipping point. Mason and his small team were in the position a lot of founders end up in: a well-funded idea that people said they admired and didn’t actually use.

But one kind of campaign kept working. When the cause was simply “let’s get a group discount,” people showed up. It was the least lofty use of the platform, and the one with the most obvious payoff. So in November 2008, the team tried an experiment on the side. They built a simple page that offered one deal a day, which only went live if enough people bought it. The first offer was two pizzas for the price of one at the restaurant on the ground floor of their own building in Chicago. They called it Groupon.

The side project grew faster than anything The Point had ever done. Within about sixteen months, Groupon was valued at more than $1 billion. By late 2010 it was in 150 North American cities with tens of millions of subscribers, and it turned down a reported $5.3 billion offer from Google. It went public in November 2011 in the biggest internet IPO since Google’s own.

Groupon’s later years were rocky, and that’s a story of its own. But the turnaround itself is clear. Mason didn’t abandon The Point because he had a better idea. He abandoned it because his users had found the one use of his platform that worked, and he was willing to build around their idea instead of his.

The lesson: when a business isn’t working, look for the one way people are using it that’s actually succeeding, especially if it’s the least impressive one. Mason built a platform for big causes. His users wanted cheap pizza. The money was in listening to them.

 

Article contributed by
The AFE Editorial Team