Eventbrite (with Julia & Kevin Hartz)

In this episode of Acquired, hosts Ben Gilbert and David Rosenthal, along with CEO Julia Hartz and her co-founder husband Kevin Hartz, delve into the compelling journey of Eventbrite. They explore its inception in 2006 by a husband-wife team, the company's unique challenges and growth leading to a successful IPO in 2018 under Julia's leadership, and the strategic pivots made during the COVID-19 pandemic that brought Eventbrite's business from booming to near-zero revenue. The conversation also touches on Kevin's new venture, a $200 million SPAC, and the potential for Eventbrite's resurgence post-pandemic, likening the future to the vibrant return of social gatherings after the 1918 pandemic. The episode concludes with a reflection on the resilience and innovation that have defined Eventbrite's story and its ongoing evolution.

• The speakers engage in light-hearted conversation before the episode begins.
• Kevin expresses a readiness to start the podcast.
• Ben jokes about using their breakfast sandwich conversation as content.

"You guys are probably getting annoyed because we should get started." "No, I mean, I think we have enough tape here of just breakfast sandwich conversation that that can be the episode."

The quotes indicate the casual and friendly atmosphere among the speakers before diving into the main content of the podcast.

• Season seven, episode two of Acquired is introduced by Ben Gilbert and David Rosenthal.
• The episode focuses on the story of Eventbrite, particularly during the COVID-19 pandemic.
• The unique aspect of Eventbrite's history, including its co-founders Julia Hartz and Kevin, is highlighted.
• Key moments to be discussed: Eventbrite's 2006 founding, the IPO in 2018, and current management during the pandemic.
• Kevin's new project, a $200 million SPAC, will also be discussed, including the endorsement by Bill Gurley.

"Welcome to season seven, episode two of acquired, the podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert." "Today we come to you with the long overdue story of eventbrite."

The quotes set the stage for the episode's focus on Eventbrite, its history, management, and current challenges, as well as introducing a discussion on SPACs.

• The hosts thank listeners for survey feedback and discuss organic growth through word of mouth.
• They encourage listeners to share their favorite episodes to help grow the podcast.
• Discussion groups within companies are mentioned as a positive trend among listeners.

"We read every single survey response which thank you for all of your thoughtful feedback." "So we have a favor to ask today. To pick your favorite episode and share it with a friend or on social media to help our little experiment of seeing if we can move the needle just by asking."

The quotes emphasize the importance of listener engagement and the role of sharing in promoting the podcast.

• Pilot, a partner of Acquired, is introduced as a sponsor.
• The services Pilot offers, such as accounting and tax for startups, are described.
• Pilot's growth to a billion-dollar company and its backing by well-known investors are highlighted.

"Our next sponsor for this episode is one of our favorite companies and longtime acquired partner pilot for startups and growth companies of all kinds." "Which is wild because when we started working with them way back when they were just a startup themselves, and now they're a billion dollar plus company backed by Sequoia, index, Stripe, and even Jeff Bezos himself."

The quotes outline Pilot's role as a sponsor and its evolution from a startup to a major accounting firm for startups.

• Kevin's traditional Silicon Valley background as an original PayPal mafia member is introduced.
• He mentions the quality of Acquired's podcast on Pinterest, where he was a seed investor.
• Kevin's early career at Silicon Graphics is discussed, providing insight into the tech landscape of the time.
• The formation of the PayPal mafia and Kevin's investments in PayPal are detailed.

"I had the good fortune of being a seed investor in Pinterest. It's an excellent breakdown, the best I've heard to date." "So I had the good fortune of meeting Peter Thiel, also. Keith Ravoys. I was undergraduate. Peter was a graduate student at the law school, and we were involved in student politics together."

The quotes reflect Kevin's deep involvement in the early Silicon Valley ecosystem and his connections with influential figures like Peter Thiel.

• Julia Hartz's background prior to Eventbrite is briefly touched upon, referencing her age difference with Kevin.
• The story of how Julia and Kevin met at a wedding in Santa Barbara is recounted.
• Julia's work at MTV and her role as a reader at the wedding are mentioned.

"So it was May 24, 2003. I could never forget that date until just now." "So it was it. That was it. One line, and I was caught."

The quotes capture the personal history of Julia and Kevin, setting the stage for their future collaboration on Eventbrite.

• Kevin discusses the founding of Eventbrite and its connection to his time at PayPal.
• The idea for international money transfer, which led to the creation of Zoom (Xoom), was inspired by PayPal's platform.
• The challenges of fundraising for Zoom and the skepticism from venture capitalists are shared.

"We were the first developers on it. And we kicked around a lot of different ideas, including ticketing." "We had launched. We were sending money to the Dominican Republic, and we started to go out and fundraise."

The quotes highlight the entrepreneurial journey from PayPal's API development to the creation of Zoom and the initial challenges faced by Kevin.

• The podcast transitions to focus on the founding story of Eventbrite and the personal history of the co-founders.
• The differences in Julia and Kevin's backgrounds and their convergence at the wedding are emphasized.

"Like, Kevin, we could do a whole sort of valley history thing here, bring us through selling a company to PayPal, and then take us all the way up to starting eventbrite. And then I want to get Julia's side of the starting eventbrite story."

The quote indicates a shift in the conversation towards a deeper dive into Eventbrite's origins and the combined efforts of Julia and Kevin in its founding.

• Julia Hartz interned during college, balancing two paying jobs and a full-time internship while taking night classes.
• She began her career in a junior position and transitioned into an assistant role in series development at MTV.
• Julia was involved with the MTV series "Jackass," witnessing its growth from a demo tape to a successful franchise.
• She worked with teams responsible for reality television shows like "Real World" and "Road Rules."

"I got my foot in the door really early on by interning during college... And I was able to really identify what I wanted to do in Hollywood pretty early on."

This quote explains how Julia Hartz's early internship experiences helped her identify her career path in the entertainment industry.

• Julia Hartz observed content-driven disruption in the early 2000s, before the rise of streaming technology.
• She was part of the MTV team during a time when reality TV was burgeoning and new, unique content like "Jackass" was emerging.
• The content creation at MTV was a blend of creative, content, and business, similar to venture capital.

"You could tell that disruption was coming, but it was really sort of coming from content, not from technology."

This quote highlights the pre-streaming era's focus on innovative content as the main source of disruption in the entertainment industry.

• Julia Hartz noticed stark differences between Hollywood and Silicon Valley during the early 2000s.
• She recognized Silicon Valley's rapid pace and potential for creating and implementing ideas.
• Despite a successful career in entertainment, Julia felt drawn to the tech industry's dynamism and potential for innovation.

"However, spending two years going back and forth between San Francisco and LA really showed me the stark differences between what was happening in Silicon Valley during that Renaissance period and what was happening in Hollywood."

This quote reflects Julia Hartz's realization of the contrasting environments and opportunities between Silicon Valley and Hollywood.

• Julia Hartz met Kevin at a wedding, where they connected over her work on "Jackass."
• Their relationship progressed quickly, with engagement and marriage following within a few years.
• Kevin admired Julia's intelligence and work ethic, which played a role in their decision to work together.

"And at that point, I knew that it would be a lifelong relationship."

Kevin expresses his immediate connection with Julia and his confidence in their future together, both personally and professionally.

• Julia Hartz and Kevin considered a job offer from Current TV but ultimately decided to pursue their own venture.
• Kevin saw potential in Julia as a co-founder and proposed a business partnership instead of her taking a traditional job.
• They founded Eventbrite together with their technical co-founder, Renault Visage, and focused on building a product that served a wide range of event creators.

"It was a wonderful thing where we got to spend 24/7 together. So it seemed very magical. And I captured this talent along with our third co-founder, Renault Visage, who always gets left out because everyone wants to talk about the couple."

Kevin discusses the formation of Eventbrite and the importance of recognizing the contributions of their co-founder, Renault Visage.

• Eventbrite started with a focus on customer support and organically grew its user base without marketing.
• The platform was initially adopted by tech bloggers and then expanded to various event types, including speed dating.
• Eventbrite leveraged SEO and user-generated content to gain visibility and transactions.

"And meanwhile, I had no idea what this was going to be like. I was not the kid with the lemonade stand, so I didn't know sort of, if I would make a great entrepreneur, but I did know that I love to learn by doing."

Julia Hartz shares her initial uncertainty about entrepreneurship but emphasizes her eagerness to learn through experience.

• Eventbrite operated for two years before raising money, reaching tens of millions in gross ticket sales.
• The founders focused on product-market fit and customer-centric development rather than seeking early investment.
• They faced challenges in convincing investors of the market potential due to the business's unconventional focus on smaller events.

"And we really feel, and I feel strongly that that's the right way to build a company. That capital can be a good thing, but a lot of times, financing really hinders companies that it gets one focused on the wrong things."

Kevin explains the philosophy behind bootstrapping Eventbrite and the importance of focusing on the product and customers over raising capital prematurely.

• Eventbrite aimed to create a self-sustaining platform where creators (merchants) could find business, publish events, sell tickets, and host events.
• The platform was designed to encourage attendees to become creators themselves, creating a cycle of growth.
• The success of Eventbrite was amplified by leveraging new social media platforms like Facebook and Twitter.
• Sequoia Capital and Ruloff identified the potential and lift Eventbrite was experiencing, leading to a Series A term sheet in 2009.

"We wanted to build a platform that did that. We wanted to put something in motion, and we would have creators, our merchants, find the business, publish on eventbrite, sell tickets, hold their events, and the attendees would learn about eventbrite, and some of them would convert to creators or merchants, and you'd wash, rinse, repeat again."

The quote explains the core business model of Eventbrite, which is to create a self-reinforcing ecosystem of event creation and attendance, fostering growth within the platform.

• Eventbrite faced a challenging fundraising environment in 2008 due to the economic downturn.
• Julia Hartz mentioned that they met with 27 venture firms and received 27 rejections.
• Despite the economic collapse, the online movement and efficiency of services like Eventbrite became more apparent.
• The company raised a seed fund, which included their own money and support from early backers like Jeff Clavier, Michael, and Xochi Birch.

"We weren't fundraising the entire year, but we did go out towards the end of 2008. It was the fall of 2008, and I don't know if you really great. You two young chats are old enough. But it was a tough time for the economy. The sky was falling."

Julia Hartz reflects on the difficulty of raising funds during the 2008 economic downturn, highlighting the resilience and eventual success of Eventbrite despite numerous rejections from venture firms.

• Eventbrite tapped into a "shadow market" of offline transactions, unlocking a large opportunity for a long tail of creators.
• The platform served close to a million creators in 2019, a number that seemed unlikely in 2008.
• Eventbrite's success is compared to Etsy's, in that both platforms brought a long tail of offline activities online and helped users grow their businesses.

"But the Internet creates the opportunity for niches to individually be large. And so this whole long tail of creators that otherwise didn't have tooling and were thus collecting checks at the door or not having an events because it was too high of a friction thing, this basically unlocked new value for that massive long tail of."

Ben Gilbert discusses how the internet enables niche markets to become significant, and how Eventbrite capitalized on this by providing tools to a wide range of creators who previously operated offline.

• Calculating TAM for Eventbrite was challenging due to the nature of the "creationist market."
• Kevin Hartz struggled with TAM calculations, unlike with Zoom, where remittances were recorded by central banks.
• Julia Hartz argues that focusing on TAM for a platform like Eventbrite is not helpful and that the platform's data provides clearer direction for product development and market focus.

"At some point when we did have some money, we would try to find consultants to help us, and it just was impossible to try to peg down every one of these categories."

Kevin Hartz speaks to the difficulty of determining the TAM for a diverse and dynamic market such as the one Eventbrite operates in, where traditional methods of calculation do not apply.

• Eventbrite's IPO process took approximately nine months and was seen as a starting point, not an end.
• The company focused on highlighting creators' stories to investors and used the IPO process as an opportunity to improve operations.
• Julia Hartz aimed for a public debut that would reflect the company's values and position in the market.
• Eventbrite faced numerous travel mishaps during their roadshow but persevered and went public on a significant market day.

"We landed on September and all along. So one thing that I think maybe you guys don't know about me is that when I make a plan, that's the plan. So I decided that since Kevin's birthday is on September 18 and Roloff's birthday is on September 19, that obviously we'd be going public that week."

Julia Hartz describes her determination to stick to the initial plan for Eventbrite's IPO, illustrating her commitment and the significance of aligning the company's public offering with personal milestones.

• Eventbrite's IPO was a significant milestone, marked by the presence of family, the executive team, first employees, and customers.
• Julia Hartz felt honored yet bittersweet being one of the youngest female founders to go public.
• Stacey Cunningham, president of the NYSE, noted the unprecedented number of women executives present.
• Pete from Citadel remarked on the unusual number of children on the trading floor.

"Stacey Cunningham, said that they had looked through the archives and had not yet found a picture of that many women executives on the podium."

The quote highlights the notable presence of women executives at Eventbrite's IPO, suggesting a break from tradition in the male-dominated finance industry.

"Pete from Citadel, our market maker, our opener, he said he'd never seen that many children on the floor."

This quote emphasizes the family-oriented atmosphere of Eventbrite's IPO day, which differed from the typical business-focused environment.

• Julia Hartz encountered a lack of female representation during the roadshow, with only one woman present.
• She stresses the importance of support from male allies in the industry.

"We actually didn't see one woman on the roadshow. We saw one, actually. Sorry, we saw one, and I'm dear friends with her."

This quote reflects the scarcity of women in the investment banking roadshow process, highlighting gender disparity in the industry.

• Kevin clarifies that during a roadshow, meetings are held with portfolio managers, not bankers.
• Portfolio managers are responsible for making investment decisions for large pools of capital.

"You're meeting with portfolio managers of long only funds."

The quote corrects a common misconception about roadshows, clarifying that the meetings are with investment decision-makers, not bankers.

• Kevin emphasizes the importance of capital efficiency and the challenges of managing private funding.
• He advocates for disciplined capital allocation and avoiding overhiring.

"We were really fighting this gravity of overspending and creating inefficiency."

The quote discusses the struggle against the tendency to overspend and become inefficient, which can be exacerbated by large amounts of private capital.

• Eventbrite raised $225 million as a public company during the pandemic.
• Julia Hartz and her team managed to navigate through a significant revenue drop due to COVID-19.

"We raised $225,000,000 as a public company."

This quote signifies Eventbrite's ability to secure funding during a crisis, demonstrating the resilience and adaptability of the company.

• The pandemic had a profound impact on Eventbrite, causing a rapid decline in revenue.
• Julia Hartz led the company through difficult decisions to shore up the balance sheet and focus on core business strategies.

"We had almost been in a position that the sun was shining. When you look back at everything else compared to what happened in March, we had a phenomenal January and February."

The quote contrasts Eventbrite's strong performance before the pandemic with the sudden and severe impact of COVID-19 in March.

• Eventbrite responded to the crisis by narrowing its focus and making strategic cuts.
• The company emphasized its self-service platform and pivoted to support online events.

"We immediately made a cut that was deep and it was painful, and it was a cut that we made not just for cost cutting sake, but actually to prepare the company to narrow its focus."

This quote explains the strategic reasoning behind the difficult cost-cutting measures Eventbrite took in response to the pandemic, aiming to streamline and focus the company.

• Julia Hartz believes being public provided Eventbrite with advantages during the pandemic.
• Access to public markets allowed the company to raise significant funds and focus on helping customers.

"I think it would have been harder if we were private."

The quote suggests that the transparency and structure of being a public company facilitated Eventbrite's ability to navigate the crisis and secure funding.

• Crusoe Energy Systems is highlighted as a clean compute cloud provider for AI workloads.
• The company's partnership with Nvidia and use of stranded energy is emphasized.

"Crusoe's cloud is purpose built for AI and run on wasted, stranded or clean energy."

The quote promotes Crusoe Energy Systems' unique value proposition, focusing on its environmentally friendly and cost-effective AI cloud services.

• Eventbrite aims to focus on its core business and self-service ethos post-pandemic.
• The company seeks to support the live experience economy and adapt to new market conditions.

"The a plus outcome is the silver lining of being able to dramatically focus the business on the core of the business."

The quote from Kevin outlines the potential positive outcome of refocusing on Eventbrite's core strengths and business model.

• Julia and Kevin provide their email addresses for contact.
• Kevin encourages support for the arts and community events, reflecting Eventbrite's mission.

"Kevin@Eventbrite.Com I'm a terrible salesperson, so I'm not going to pitch eventbrite."

The quote humorously conveys Kevin's reluctance to directly promote Eventbrite, instead focusing on the value of community engagement and support for the arts.