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How a spare server turned into Twitpic, the $1.5M+ a year startup (mixergy.com)
85 points by merrick33 on Jan 14, 2010 | hide | past | web | favorite | 59 comments

That whole story is just one big WTF to me.

It seems most things sailing in the wake of twitter simply defy all logic and common sense. There have been literally dozens of picture sharing services before twitpic. The only difference I can see is the name ("look, we're for twitter!") and that he basically integrated an url-shortener.

The entire site looks like about a week's worth of work. 700k in annual profit? Not sure if I want to laugh or cry.

The entire site looks like about a week's worth of work. 700k in annual profit? Not sure if I want to laugh or cry.

Laugh. Be happy. Learn from this that you don't have to make something people want that nobody else could make because it's so complex and you're awesome. You just have to make something people want.

Does that mean the rest of us are bad at figuring out what people want, and we need to try to build the skill? Or are we just not as lucky?

It means that the only startups which get profiled/interviewed are the ones which do get get successful. Survivorship bias here.

The other takeaway for me is that it was an insanely risky bet.

Twitter could easily have built the functionality to share pictures into twitter (Like facebook did). Heck - then they might have a reasonable revenue stream.

If Twitter had done that, twitpic would have been stomped on.

Right, but if the entire site really was about a week's worth of work (or anything like that order of magnitude) then I wouldn't say this was insanely risky, I'd say "why the hell would I not try this?" ;)

Of course he was solving his own problem in the process - so worst case scenario : An educational programming experience that leads to a useful personal tool.

I wish I could vote twice, just occasionally.

I'm guessing he didn't just write it then sit back and let it run. Things tend to need tweaking/maintainence/upgrading, especially if you're scaling to the numbers he has...

But I agree, why not try stuff like this... Might just work.

A very risky bet, with high payoff and low risk. AKA, a good bet.

Chance of Success * Reward - Cost. Just because the chance of success is low doesn't mean it's a bad idea.

Very risky, yes. But it is chicken risk, not pig risk.

That to me is the real message from this: That twitter failed to implement and integrate this feature into their own service, and are missing out on a pretty decent revenue stream.

But the revenue stream is advertising which they could turn on any time

It's not so much what the site does but the fact that it came earlyish on and got so much traction (and recognition from most of the major Twitter clients). Being in the right place at the right time can beat execution in most areas.

you should cry for your attitude.

Why the negativism?

To clarify; I didn't mean to talk down the author nor the site. I was just expressing my surprise (and partly envy) about the success of such a seemingly trivial project.

My laugh/cry statement was about the fact how I (and many others) struggle in comparison. Seeing a site like this take off is a bit disconcerting. But well, you can't blame the lottery winner.

You should grow up.

you should cry that you didn't come up with that idea and have 700,000k+ sitting in your bank account.

Thanks for the comments everyone! I hope that you will find the information in the interview useful in some way.

Feel free to hit me up on Twitter (@noaheverett) if you have any questions.

Noah, thanks for putting all this info out there. And congratulations on your success so far.

Question: How did you respond to the leaked Twitter notes in which the Twitter guys talked about "blessing" another Twitter photosharing application instead of you? That had to be a low point. I remember when I first read that I clucked my tongue in sympathy for you. Do you suppose the Twitter guys would rather just work with a known quantity instead of some guy out in SC?

http://www.techcrunch.com/2009/07/16/twitters-internal-strat... (ctrl+F for "twitpic" to find the relevant section)

Is "O-off" a subtle dig at OAuth, or an audio transcription typo?

Typo, it's fixed in the Etherpad version

> Noah was recently offered 10 figures for the business


There were a few times in this interview that my BS detectors went off. Andrew asked a question regarding which VCs Noah had spoken with and Noah said he couldn't respond due to NDA. After some probing the story changed to say that only some of the VCs required NDA at the point of discussing monetary figures. Andrew did a nice job by continuing to ask questions like "what did they want you to do with the money?" and Noah again vacillated. It just struck me as odd that he couldn't remember what the discussions were about, it seems like something that should be really easy to remember. Of course, he could have just been nervous as well, but it really smelled fishy to me.

Disclaimer: I don't know Noah, I have never used TwitPic, I have nothing for or against Noah and / or TwitPic, so take all of this with an ENORMOUS grain of salt since this is nothing more than pure speculation

I've met Noah on at least one occasion. He's a very nice, and very bright guy. But he is a completely accidental entrepreneur, so I'm not surprised at all that he struggled in an interview like this. In fact, this might be the first big real-time interview he's done.

My reading of the situation tells me that he's just really uncomfortable talking about the conversations he's had with VCs, and doesn't know how to convey that without being awkward.

That said I've never really understood his motivation for handling TwitPic the way that he does, but that's definitely not my place to criticise.

That would certainly explain some of the nervousness. He seems like a nice guy, and the interview was interesting for the most part. I've just seen the NDA game ("sorry, I can't go into details, everything is under NDA with mystery players") played before so it stuck out to me.

To be 100% clear, my post was purely speculation. I was just about to delete it before I saw you'd replied.

most companies are started by accidental entrepreneurs. steve jobs was a hippie basically, larry+sergey were doing phd work, zuck wanted to get laid at harvard instead of studying for finals, etc.

In fact, it seems to me most of the succesful folks are motivated by the fact they are going to do something cool and have fun and not necessarily by the idea of making billions. That is the one thing I cannot stand about mixergy: it's always about millions, billions and gazillons.

Nervous is an understatement...as you can see I almost failed speech class for a reason :)

That's a good enough explanation for me; I hope you can see why I thought it was odd. I was about to delete my comment but saw that tannerburson had replied.

Sooo... were the VCs interested in getting you to add manpower or spend money on marketing (or something else, like infrastructure)?

Yeah man power and infrastructure. The goal with VC usually is to help something move faster in the direction of success/profitability via whatever resources the startup is lacking in.

Yeah 10 figures is a typo. It's stated as 8 in the actual interview.

The real story is the Tulsa tech scene. First, the Ping.fm acquisition and now the Twitpic story. Tulsa FTW.

That's awesome. I may move to Tulsa area later this year and I've been wondering about the tech/hacker scene.

Anyone else?

That was a joke, really. The scene here is limited. There are a few of us working on interesting things. The problem is when they take off the founders tend to move, like the guys behind Ping and Noah.

Anyway, when you do move look me up.

Dang, I'm usually good at spotting jokes/sarcasm–my bad. I'll definitely look you up.

Oh man. Good catch. Typo. Complete mistake. I'll correct it.

I was doing an interview and didn't see your comment till now.

It is - in the interview its 8 figures, 10+ million.

10 figures = 1 BILLION. I have to agree with the OP on this. I think it's BS.

It's a typo. He says 8 figures in the interview.

(I was agreeing ;-) I think Andrew combined 10 million and 8 figures.

LOL. I meant to reply to the other guy.

8. andrew says "so at least 10 million". he counters "much more than 10 million".

And if he didn't take "much more than 10 million" for a site that's making about $1m in profit, he either has gigantic balls or a tiny brain :-) Good luck to him though!

I imagine that its profit in the next financial year will be more. Also, he isn't in it for the money. Would you walk away from a fun success?

It depends. If it were powered by advertising, yes, yes, and yes. If it were customers paying money for goods or services, not if it were really fun.

But I'm still at that pre-$5m net worth stage where having more than that would basically set me for life. If I were already wealthy, the rules would be totally different. At the moment I just want to hop that fence, then forget all about money (to a point).

It certainly seems hard to believe...

it says somewhere 8 figures. thats a typo.

I would have sold, at any time twitter could basically undermine his business, actually the more successful it becomes the more likely twitter would be to integrate it.

To wit, Twitter switched the default URL shortener from tinyurl to bit.ly, and now bit.ly is the largest URL shortener on Twitter.

This is what happens when your business is a commodity (and you're not the one who commoditized it).

Twitter is almost guaranteed not to go into photo sharing. They've had tons of opportunity to add in media services but they clearly aren't interested.

My thought as well

Lucky guy. Twitter could have killed him in a glimpse by just offering an image/video storing site themselves.

Yeah, right after building their own URL shortener.

This is just one of those pot-luck ideas. It was already out there, he just hit the jackpot.

2010 turns out to start full of good news about small teams. First Balsamiq story, now this one. Anticipated is a new wave of optimistic first-time entrepreneurs with financial projections built on these cases :)

Question for noah, if he's willing to answer it:

You said that currently you have $1.5M+ revenues, and margins of 70%. What are the current cost breakdowns right now? Other than salary, what other ongoing costs do you have?

You have to serve a lot of content to make $1.5M in advertising.

well i guess the cdn costs is trough the roof when the core functionality of your site is photo sharing.

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