That Time Alexis Turned a Rejected Idea Into a $10 Million Exit

Ready to take your business to the nest level? I have one spot left in my Corporate Contracts Coaching program. If you are finally ready to start fishing for bigger fish and making the kind of money your deserve, shoot me an email at [email protected] and let’s talk.

When Alexis was ten years old, he built a popular fan site on GeoCities about the video game Quake. What he really loved was the traffic counter; watching strangers from across the world show up on his page.

(That same passion would later change the Internet.)

Years later at the University of Virginia, Alexis met Steve Huffman. They were both geeks, both restless, both convinced they were not meant for ordinary careers.

Yeah, they became fast friends.

During their senior year, they drove to Boston to hear Paul Graham speak about the future of startups. Graham had sold his business to Yahoo for $50 million and had just begun Y Combinator (what would become the famous startup accelerator / funding source.)

Hello Paul!

But remember: Alexis and Steve did not have a company yet. They were just a couple of college kids with an idea for a food app. They shared the idea with Graham. He liked their energy, hated the app.

Still, he told them they should apply to Y Combinator.

Getting their hopes up from none other than the founder of the program, Steve ad Alexis poured their all into upgrading the application. They got invited to present it in person, back in Boston.

The Big Pitch

So the pals traveled back to Boston a few months later for the official interview and pitch, and then they waited. The answer came back too quickly:

Thanks, but no thanks.

Dejected, the pals hopped on the train and headed back to college in Virginia. They were staring out the window at their failed dream when Alexis’ phone rang.

It was Paul Graham.

He told them he couldn't stop thinking about the interview. Yes, he still hated the food app, but he liked them as founders. He told them to get off the train, turn around, and come back to Boston.

His only condition was that they had to build something else.

They didn't hesitate. They stepped off the train in Connecticut and caught the next one heading back north (but only after Alexis convinced the conductor to let them ride back for free on the same ticket, they being broke college kids and all.)

The “Front Page of the Internet”

Paul said that Y Combinator would give the young men $12,000 if they would build “the front page of the Internet.”

OK!

So Alexis and Steve built a bare-bones site. There were no complex features on the site and definitely no big vision document. It was just links and two buttons: Up and Down.

And at first, it looked like darkness, their old friend, was back. There were no users. Absolutely no users.

Today, of course, their site - Reddit - is one of the most popular sites online, and worth some $10 billion. So what happened?

The Secret Ingredient

The secret ingredient wasn't the code. It was energy. Alexis and Steve created dozens of fake accounts. They submitted links in Reddit forums, they commented, and they even argued with themselves under different names.

They manufactured activity until real people would hopefully arrive.

The founders understood that like energy attracts like energy so they seeded their site with comments and content and made it dead simple for anyone else to do the same.

The site blew up.

Within a year, Reddit was acquired by Condé Nast for some $10 million and is now one of the most influential platforms in the world.

P.S. As I mentioned, if you are ready to catch bigger fish and work with big brands, I have one spot left in my Corporate Contracts Coaching program. If so, shoot me an email at [email protected] and let’s talk!

The Takeaway

One of the great things about being an entrepreneur is that you can pivot, and probably will HAVE to pivot if you want to make it to the promised land. Alexis and Steve were on that train with a dead dream, but they didn’t let their ego keep them on the tracks. They were willing to be wrong about their food app and go in a whole different direction.

In your business, your greatest asset isn't your original plan; it is your agility.

Steal This Strategy

📖 Book — Without Their Permission by Alexis Ohanian The raw account of the early, scrappy tactics used to build Reddit from nothing.

🎥 Video — Alexis Ohanian: How to make a splash in social media A TED talk on the power of community and why the "users" are the real secret ingredient.

🛠️ Tool - Fiverr A great platform for entrepreneurs to get affordable help with design, marketing, and more.

About Steve

Steve Strauss is the best-selling author of The Small Business Bible (and 17 other books), Inc.’s small business columnist, a lawyer (non-practicing), and an entrepreneur. He sold his last venture, TheSelfEmployed.com to Mark Cuban & Zen Business. Need a ghostwriter or a newsletter for your business? Contact Steve!