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The Founders Behind the Worldwide e-Commerce Marketplace : Groupon

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In the industry, where most of the businesses want to earn more profit by avoiding bargaining and discounts on their services, Groupon.com brought a new way of earning profits with their different business model. The company is solely based covering the idea of selling discount deals on the services of local as well as multinational companies. The idea was unusual which gained huge popularity and benefits in a short interval of time.

It was Andrew Mason, who came up with the idea of creating such a business model for his first start-up company. Andrew Mason, who was first appointed as the CEO of the company, convinced Eric Lefkofsky, to invest $1 million in the idea, making the latter the co-founder of Groupon.

Early Life

Andrew was born in Pennsylvania and did his schooling from Mt. Lebanon High School, in 1999. In 2003, he received a bachelor’s degree in music from Northwestern University. After graduating from college, he joined a web designing company InnerWorkings, as a web developer. The company owner, Eric Lefkofsky, became his future partner and co-founder of Groupon.com. Andrew left the job to join the University of Chicago’s Harris School of Public Policy to pursue a master’s degree. However, he dropped out from the course after a few months of joining and again started working at Lefkofsky’s.

Founding Groupon.com

In 2006, the time, Andrew was working as a web developer, he was also dealing with the cancellation of a cell phone contract. He became frustrated with the client service and was looking for a solution. Soon, an idea lit Andrew’s mind and he started working on ThePoint, his first entrepreneurial venture. Lefkofsky also became interested in the project and offered a $1 million amount for the start-up. The two along with another business partner of Lefkofsky, Brad Kwywell, became the co-founders of ThePoint.

ThePoint was a platform developed for the purpose of getting people together to accomplish a certain goal, using the social media. Eventually, the main objective of ThePoint became saving money through various discounts from local vendors. In 2008, ThePoint was renamed to Groupon and was launched as the platform that focussed entirely on group buying.

The idea of Groupon was new in the market, and, in just one and a half year, the company valued at over $1 billion. The company became the first one, to join the $1 billion club in such a small time. In November 2011, Groupon was public, having the biggest IPO by an Internet company, since Google (2004). The concept behind Groupon was to provide deals to the consumers and sell the services of the companies, taking 50 per cent of every deal. Till 2014, it was noted that the company revenue hiked by 25% every passing year.

To avoid any kind of competition, Andrew and Lefkofsky started acquiring the local deal-of-the-day companies. Starting with the Europe-based MyCityDeal in 2010, Groupon also acquired other companies like ClanDescuento, the Japanese service Qpod.jp, Russian Darberry.ru, the Singaporean Beeconomic.com and the Indian deal-of-the-day website SoSasta.com. By March 2015, Groupon expanded in 500 cities worldwide, has 48.1 million registered users.

On February 28, 2013, Mason was dismissed from his post of CEO. Lefkofsky and Brad Keywell remain as the major investors of the company, and the former is serving as the chairman of the company.

Tom Preston-Werner : Co-founder of GitHub

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Almost every developer in the world has submitted at least one line of code or checked out for coding solutions on the social coding platform GitHub. GitHub is the largest online community of developers where they share programming code with other programmers to help them or seek help from them, to create better software. GitHub is among the fastest growing startups with having over 28 million users and 57 million repositories. It was founded by Tom Preston-Werner, a software developer, inventor and entrepreneur from America.

Early Life

Tom was born on 28 October 1979, in Dubuque, Iowa, US. He lost his father at an early age. His mother was a teacher and his step-father was an engineer. He did his schooling from Dubuque Senior High School and went to Harvey Mudd College in Claremont, California, to pursue his higher education. During his college, he realised that he is more interested in computer programming than the subjects he was pursuing at college. So after studying for two years in the college, he decided to drop out of the course and focus on learning programming languages.

Career

After leaving the college, Tom started with many small coding projects, one of which was based on flash replacement technique. At that time the websites had a limited set of fonts available for the users. His flash replacement project allowed the users to use any font on any website.

Tom Preston-Werner
Image Source: flickr.com

Later in 2004, he came with a new project named as Gravatar. The concept behind it was to maintain a single avatar for dozens of other services. The project was a success, but, without a business model, it was not paying the way it was supposed to. Finally, in 2007, a company named Automattic acquired Gravatar.

In 2005, Tom moved to San Francisco and started working with Powerset. Eventually, Microsoft acquired Powerset in 2008, and, offered Preston-Werner a $300,000 bonus and stock options in the company. But he had already started working on GitHub project, so he declined the offer to focus on it.

Founding GitHub

Tom was always in the favour of documenting the software codes so that other developers can easily understand how the codes exactly work. Being an active contributor to the open-source developer and hacker culture he came across with the idea of an open-source development community. Also, with the bad experience of the business with Gravatar, this time he was ready with a better business architecture for his new project. In 2008, he founded GitHub with his co-founders Chris Wanstrath, PJ Hyett and Scott Chacon. He had met Chris Wanstrath and PJ Hyett on one of the developer meet-up in San Francisco. GitHub was a commercial success and gained over 46,000 public repositories, in the initial year of its being online. Tom was appointed as the CEO of the company.

In 2014, Tom resigned from the company after he and his wife were accused of harassment by GitHub programmer Julie Ann Horvath.

After resigning from GitHub, Tom co-founded Chatterbug and Codestarter. Codestarter is a non-profit organization that donates computers to kid coders. He works as the advisor at Codestarter.

Personal Life

Preston-Werner is married to Theresa Preston-Werner, an anthropologist, known for her involvement in much historical research and social subjects.

Andy Bechtolsheim : German Electrical Engineer & a self-made Billionaire

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Being a successful entrepreneur depends highly on an individual’s decision making and risk taking capability. Higher the risk, greater the reward. This has been said and written, over and over. If you read about businessmen, who are highly successful today, you will find the huge array of risks, these people have taken to reach where they are. Out of these risks, emerges many successful companies. A company that produces valuable products and employs thousands of people. One such risk taker, and now a billionaire, is Andy Bechtolsheim.

Early Life and Education

Andy was born on 30th September 1955, in Bavaria, Germany and was the second of the four children in the family. He spent the most of the time of his childhood between the electronics devices, as there was no television or children in the neighbour to play with. So he chose to keep himself busy and entertained with electronics.

At the age of 16, Andy designed an industrial controller that worked on Intel 8080. He programmed it in binary code as he didn’t have any access to assemblers. He made this controller primarily for a nearby company, who then further paid him royalties for the product. These royalties paid for Andy’s most of the education.

Andy Bechtolsheim
Image Source: forbesimg.com

When Andy was attending the Technical University of Munich to pursue engineering, he entered the Jugend forscht contest that was organised for the young researchers. He kept participating in the contest for three years and finally, in the third year i.e. in 1974, he won the physics prize.

Andy, further, went to Carnegie Mellon University in the USA, after he received the Fulbright Award, in 1975. In 1976, at the same university, he received his master’s degree in Computer Engineering. Later, he went to the Stanford University to earn his PhD in electrical engineering, in 1977.

Early Career

While his time at Stanford, Andy came across the Xerox Alto computer, developed at Xerox Palo Alto Research Center. Inspired by this computer, he designed a powerful workstation, which had a built-in networking, named as SUN workstation (taken from the initials of Stanford University Networking). This workstation gained him free access to the researches at Xerox Palo Alto. During the same time, Lynn Conway was developing Very Large Scale Integration circuits (VLSI).

Birth of Sun Microsystems

The VLSI was developed on the workstation made by Andy. One such company called Daisy systems was also into building computers for the VLSI design. A man named Vinod Khosla worked at Daisy systems, who would soon partner with Andy. Khosla graduated from Stanford Graduate School of Business just a couple years earlier than Andy. He was good friends with his classmate Scott McNealy who was the manager of manufacturing at Onyx Systems. These three people came together and developed a business plan for their first company. They also received funding in no time from the venture capitalists in 1982.

Andy with three others was joined by Bill Joy as the fourth member responsible for the development of BSD series of Unix OS. In the earlier days, Andy and Joy shared an apartment in Palo Alto. Sun Microsystems launched their first product named Sun-1. It included Stanford CPU board design with expanded memory and a protective metal sheet casing. The company went public in 1986 and reached $1 billion in sales by 1988. Andy also launched a cheaper desktop computer for educational market under his project SPARCstation. The computer was known as Campus.
Changing Companies.

He left Sun Microsystems in 1995, after working there for almost a decade. The same year he founded Granite Systems. A startup working to develop high-speed network switches. In 1966, when Andy owned about 60% of the company, Cisco acquired it for $220 million. After this deal, he also acquired the position of Vice President and General Manager of Cisco’s Gigabit Systems Business Unit.

After working for 8 years at Cisco, he left the job in 2003 and took the head position in Kealia, Inc. This was the company that Andy had founded back in 2001 along with a Stanford Professor named David Cheriton, also a partner in Granite Systems. Kealia worked on developing advanced server technologies using the Opteron processor from Advanced Micro Devices.

Andy was soon going to go back to where he started from. In the February of 2004, Sun Microsystems acquired Kealia, Inc., and Andy took the position of Vice President and Chief Architect in the company. He founded yet another company named Arastra which was renamed as Arista in 2005. The company was focused on developing high-speed networking. He left Sun and took Chairman and Chief Development Officer in Arista in October 2008.

Investment in Google

In the September of 1998, Andy and Cheriton decided to invest in the emerging search engine company Google. Both invested around $100,000 even before the company was founded and legally incorporated. His investment is now worth $1.6 billion.

Andy is known as the most successful investors in the electronics sector. He also invested in Magma Design Automation. His stake is valued at $60 million. He has invested in a number of startups and has been successful every time.

Achievements

Andy received the Smithsonian Leadership Award for Innovation in 1999. He also received Stanford Entrepreneur Company of the Year award. He is a member of the National Academy of Engineering.

Personal Life

Andy is not married and has not taken US citizenship. He continues to be a German and does not intend to change it. He lives in Palo Alto, California, US.

Sean Parker : The Co-founder of Napster

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In the advancement of the tech world, the college dropouts have made their different place with their vision and intelligence. Whether it’s the founder of Apple, Steve Jobs, Michael Dell from Dell Technologies or Microsoft’s Bill Gates, they have proven that one’s intelligence and talent cannot be judged with a mere degree. Sean Parker an American entrepreneur and philanthropist have also followed their lead and have discarded the worth of a physical degree by his knowledge.

Early Life

Sean Parker was born on 3 December 1979, to Bruce Parker and Diane Parker in Herndon, Virginia. His father was a U.S. government oceanographer and mother was a TV advertising broker. As a kid, Sean was an avid reader and started learning computer programming from his father on an Atari 800 at an early age of 7. The exposure to programming grew his interest in hacking and at the age of 15, he hacked into the network of a Fortune 500 company. His IP address got tracked by FBI and as a result, being an under-age, he was sentenced to community service.

Sean Parker
Image Source: wikimedia.org

Parker did his High School from Fairfax County, Virginia and Chantilly High School. During his school, he used to spend most of his time in the computer labs learning new programming skills. During his final year of high school, he got an internship at Zynga, Pincus’s Washington D.C. and later, got employed at CIA, while he was still a teen. Until the completion of his school, he was earning enough to be able to decide to become an entrepreneur.

Career

During his teenage, Parker met his future partner Shawn Fanning, and the two bonded with each other by their common interest- Hacking. After a few years, the two launched their startup as a free music file-sharing service Napster. At the time Parker was just 19 and he invested $50000 in their startup. Within the first year of its launch, Napster got millions of users, along with a few lawsuits by recording companies like Recording Industry Association of America. Even with the fastest growth of the company it got shut down in only two years.

In 2002, Sean founded Plaxo, a social networking tool that later got integrated into Microsoft Outlook. Plaxo also became viral in a short span of time, but this time Parker was driven out of his position in Plaxo by its investor over some argument.

Later, in 2004, Parker became familiar with a networking website The Facebook and managed to meet Mark Zuckerberg. After a few months of this meeting, he was appointed as the president of the 5-months old company. Sean played a pivotal role in creating the clean interface and the picture sharing features in Facebook. In 2005, he was arrested from a private party as the police founded cocaine in his rented house. After a few days, he was released from all the allegations, but, this brought a bad impact on the other investors and he had to resign from his post. Even after the resignation and the controversy, he has always been in touch with Mark Zuckerberg unofficially.

Being a music lover and after a bad experience with Napster, he got to know about Spotify and invested the US $15 million in it. Now he is serving as one of the board members of Spotify.

After investing in Spotify, he started a few new ventures like Airtime.com, Brigade and invested in other startups like Willcall, Quantcast, Path, and Knewton with its venture capital The Founders Fund based in San Francisco founded by Peter Thiel.

Donations and Charity

Sean Parker is associated with cancer research donations since 2005 and has created Parker Institute for Cancer Immunotherapy, in April 2016, with a grant of $250 million. He has donated $24 million to create the Sean N. Parker Center for Allergy Research at Stanford and $5 million grant to Stand Up to Cancer and the Cancer Research Institute. His foundation focuses on three areas: Life Sciences, Global Public Health and Civic Engagement.

Parker has got an interest in the politics and has also funded both sides of US political parties and spoke in favour of rich people paying higher texas. He has also been a part of many political campaigns and has supported them financially.

Personal Life

Sean got engaged to Alexandra Lenas, a singer-songwriter and the two got married in 2013. Their wedding was based on lord of rings theme and created news as it cost more than $10 million. The two have a daughter named Winter Victoria Parker and a son named Zephyr Emerson Parker.

He was featured on the cover of the Forbes 400 issue in 2011 and was ranked number 722 in the Forbe’s list of the world’s billionaires in 2016.

Steve Chen – Co-Founder of YouTube

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Young and enthusiastic minds always take their ideas to next level starting from scratch. Many of these revolutionary ideas have led to innovations that have changed the way our world is connected. Now you can be connected to any part of the world in just a few clicks. You are also able to see what’s happening in the world, on the largest video streaming network – YouTube. The idea for this video streaming service was born into one such young mind of Steve Chen.

Early Life

Born on August 18, 1978, in Taipei, Taiwan, Steve Chen and his family immigrated to the United States of America, in 1993 and, got settled in Prospect Heights, Illinois. Chen took his middle school education from River Trails Middle School, which is situated in Mount Prospect. Then for the first year of high school, he went to John Hersey in Arlington Heights. He spent the next three years of high school at Illinois Mathematics and Science Academy in Aurora, Illinois. Finally, Chen went to the University of Illinois at Urbana-Champaign, to pursue a degree in Computer Science. and graduated in 2002.

Initial Career Stages

Just after graduating, Chen landed his first job with industry financial company PayPal. It was this company, where he met his future co-founders Jawed Karim and Chad Hurley. He also spent some time as an early employee at Facebook, but, left the company in few months to focus on his own venture.

Steve Chen
Image Source: wikimedia.org

He had a knack for innovative ideas and one such idea was lurking in his mind. It was to develop a video streaming platform, and Chen, along with Chad Hurley and Jawed Karim, founded YouTube in 2005. Steve took the position of Chief Technical Officer in the company.

Just within few months, Chen announced that YouTube was receiving around 100 million views per day and around 65000 videos were being uploaded from different parts of the world each day. The popularity of YouTube skyrocketed and quickly came to the notice of Google. Next thing they knew was Google offering to acquire YouTube. The online video streaming site was ranked among the top 10 most popular websites.

Google acquired YouTube in 2006 for a mind-boggling $1.65 billion. From then on, YouTube has never looked back and is constantly achieving new heights of success. Chen received 625,366 shares in Google and extra 68,721 in trust as the part of the sale. These shares are valued at $729 million in 2018.

After YouTube

Steve Chen is an energetic person who does not prefer to stop at one success. The definition of success is to keep moving forward and achieve greater heights than the previous ones. The next venture Chen started was named AVOS Systems, Inc. He founded this venture along with Chad Hurley and Vijay Krishnamurthy. One of the services known as Mixbit, which is a video sharing service is quite well known. AVOS acquired Delicious from Yahoo! Inc. The founders sold AVOS Systems, Inc. to Science, Inc. in 2014.

Along with founding a couple of most successful companies, Chen is also well-known for his investments in promising start-ups and businesses. He has invested in HonestBee, Drama Fever, Spool, Wish, Road Hero and many more.

Personal Life

In 2009, Chen got married to the Google Korea product marketing manager, Park Ji-Hyun also known as Jamie Chen. The couple lives in San Francisco with their two sons. Chen is a huge art admirer and makes a humble contribution towards The Asian Art Museum of San Francisco.

In 2008, Chen along with his partner Chad Hurley was awarded Vanguard Award. The Magazine 2.0 nominated Chen as one of the ’50 people who matter now’ in business. The Asian Scientists Magazine listed Chen as one of the 15 Asian Scientists to Watch.

Tony Hsieh – Co-Founder of the Online Shoe and Clothing Company Zappos

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For constant growth, one needs to take risks, from time to time. Getting into a new business, or changing a line of work, or anything that keeps your adrenaline rush at its peak as it will lead you to most fulfilling experiences. The success, of course, follows and, so does money. Entrepreneurs are known for their risk taking abilities and venturing into newer forays. Tony Hsieh, is one such figure, who has kept evolving his talent from time to time and has reached the topmost position in the corporate world.

Early Life

Tony Hsieh was born on 12 December 1973, in Illinois, US, to Richard and Judy Hsieh, who shifted from Taiwan to Illinois. He was brought up on the bay area of San Francisco with his two brothers, Andy Hsieh and Dave Hsieh.

He graduated in Computer Science from Harvard University, in 1995. While studying in Harvard, Tony managed the Quincy House Grille and, sold pizza to the students in his dorm. Here he met Alfred Lin, who was his best pizza customer and, a future colleague.

Career

Tony landed his first job with Oracle Corporation, soon after he graduated. But, just in half a year, he realized that the corporate environment was not meant for him and, left the job. Later he went on to set up LinkExchange – an advertising network – along with his college friend and ex-Oracle employee Sanjay Madan.

Tony Hsieh
Image Source: flickr.com

The central aim of LinkExchange was to advertise the sites of companies, interested in the company. Tony landed his first 30 clients, via e-mail and, just within three months, the site displayed ads of 20,000 web-pages. Members were allowed to advertise their site using banner ads on LinkExchange. The banner ads were displayed over 10 million times and, by 1998, the site registered 400,000 members and 5 million ad rotations daily. The company was sold to Microsoft for $265 million, in November 1998.

The next business Hsieh started was an incubator and investment firm, whose name was originated as a result of a dare. One of Tony’s friends said that she would invest everything, she has got, if they named the company ‘Venture Frogs’ and, thus, accepting the challenge, the company with the same name was born. Venture Frogs invested in several companies, like AskJeeves, OpenTable, and Zappos. The company did not witness huge profits but, led Tony to take interest in Zappos.

Founding Zappos

Nick Swinmurn, the person with the original idea of Zappos, approached Tony, in 1999, with the idea of selling shoes online. Hsieh wasn’t interested in the early days but, when Swinmurn mentioned that footwear business accounted to $40 billion in the US alone, of which 5% was sold by paper mail orders.

The figures struck Tony, and through Venture Frogs, he decided to invest in the business. He accepted the position of CEO of Zappos, investing $2 million, and in 1999 started ShoeSite.com. Tony enjoyed working in Zappos and set up an office in Venture Frogs premises itself. In 2000, the company received additional funding and generated about $1.6 million in revenue, and $8.6 million, in the next year.

In 2004, Sequoia Capital invested $35 million in Zappos as they saw the company made sales worth $184 million. In 2007, the company made sales worth $840 million and had expanded their products, in every sector, like kids, men’s, women shoes, etc. By this time, they had a dedicated headquarters situated in Henderson, Nevada.

The year 2009, was the most blooming for Zappos, as the company touched $1 billion in revenue. On July 22, 2009, Amazon acquired Zappos, for a whopping $1.2 billion, and Hsieh made about $214 million through this deal.

Later, Hsieh also joined JetSuite’s board in 2011 and closed a $7 million investment deal for the ‘very light’ jet project.

Personal Life

Tony Hsieh, apart from business, believes in sharing knowledge. Therefore, he wrote Delivering Happiness, which became an international bestseller. In the book, he explains the details of Zappos’ journey and achieving the feat of $1 billion, in less than a year. The book remained on top lists for 27 consecutive weeks.

Tony isn’t married and likes to party. He does not stay with his parents as they wanted him to be a doctor or a lawyer. Hsieh received Ernst & Young Entrepreneur of the Year Award in 2007. He lives in Downtown Las Vegas, Nevada, and also has a home in Southern Highlands.