On June 3rd, Startup Grind San Francisco hosted CEO and Co-Founder of Thumbtack Marco Zappacosta. Zappacosta’s interview was conducted by Sequoia Capital's Bryan Schreier centered on the development of Thumbtack and how the company overcame obstacles to arrive at their current success.
A world run by technology where consumers are lazy.
Zappacosta and his co-founder Jonathan Swanson did not go the traditional route of starting Thumbtack. Instead of the typical approach of having an idea and creating a company from an idea, they founded the company and then went searching for a problem to solve. After their original idea no longer became an option due to the arrival of Mint, they realized that the market was lacking an easy to use mechanism to connect customers to professionals to help them achieve their personal projects. In the interview Zappacosta described where the influence for Thumbtack came from the question why it is so hard to hire a plumber, he says: “Here you were 2008, you could buy any product you could think of in 2 to 5 days it would show up at your doorstep, you could stay in touch with your friends all around the world instantly and for free, you could look up any piece of information, on any topic, at anytime, anywhere, and yet you had to waste a whole afternoon to hire a plumber…that just made no sense to us.” Thus they arrived at the idea of Thumbtack, with the notion that in a world run by technology where consumers are lazy, there was an inevitability of the idea of a service like Thumbtack that would bring together customers with professionals.
A bulk of the interview centered on the challenges Zappacosta and his team experienced between their angel and Series A round of venture capital funding and how he kept his team afloat through the difficult time. Zappacosta described how at one point only 3 of 10 members of his team were earning a real salary, but his team members forged strong relationships because of their leaders’ fearless transparency. He never hid information from his team, but his vulnerability and honesty about why he himself could not understand why investors couldn’t see the value in Thumbtack that they saw in their company and their goals. So to stay afloat in the fall of 2011 between Thumbtack had to switch from a transaction fee based system to a subscription service to prove to investors that they could bring in revenue.
Presuming to know what you do not actually know.
Zappacosta’s humility, describing in the interview, “the worst mistake you can make is presuming to know what you don’t actually know”. For example, Thumbtack’s current model represents the idea of third times the charm because the monetarized system Thumtack used today came a result of two other systems that did not work. Zappacosta’s ability to acknowledge that he did not have all the answers and still does not know is what has made him grow as a better leader for his team. Thus by being a transparent and unassuming role model for his team, Thumbtack was able to grow to its current success of over a billion dollars in commerce annually.
Hire the best people around.
In terms of growth, Zappacosta also emphasized the importance of hiring the right team and utilizing being in the Silicon Valley as a resource to make sure to hire the perfect candidates. Thumbtack did not truly expand their team with vice president’s until 5 years into the company’s development, which allowed it to grow and wait to hire the best people around. Zappacosta, a bay area native, had the advantage of being able to reach out to experienced leaders in the valley to ask them what he should look for in their similar positon at Thumbtack. Zappacosta highlighted the uniqueness comradery and welcoming environment found in the bay area. Since there is such a diverse group of companies growing here, many leaders were beyond willing to help him learn about the recruitment process because they are not direct competitors thus it is a win-win for everyone. We should recognize how fortunate we is in the Silicon Valley that not every situation with another firm is a Nash equilibrium situation, where ones loss is another gain thus more experienced companies can help newer developed firms.
In conclusion, Zappacosta demonstrated how young company leaders should be vulnerable, transparent and honest with their team and reach out to other Silicon Valley leaders to help them gain the wisdom and knowledge to help their company grow.
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This was written by a SG contributor.
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