This afternoon WPP Beach at Cannes Lions saw two young tech entrepreneurs worth a combined US $3.5 billion sit down for a casual chat. They were Snapchat Co-founder & CEO Evan Spiegel and Reddit Co-founder & CEO Steve Huffman.
Evan Spiegel interviewed his friend Steve Huffman about his return to Reddit five years ago after leaving the company in 2009. Both have built incredibly successful technology businesses.
There are 190 million users globally on Snapchat and according to new research, they reach 90 per cent of all 13-24 year olds in the US.
Meanwhile Reddit has a base of 330 million users, the largest ever community for tech lovers and gamers.
Steve Huffman: “When we started Reddit, we didn’t know what we were building. And even in our wildest dreams we didn’t think we’d be here today, let along dreaming of what we want to do in the future.”
“I was gone for five years and when I left Reddit, it was already bigger than I think I’d ever imagined. And it was the only thing I’d every done. So I had no perspective.
“I thought if you build something and put it online, it will just grow. That’s what happened with Reddit. And coming back was actually a very difficult decision.
“I was at Hipmunk which is a a travel search company, I was slinging plane tickets. And Reddit was going through a really difficult time.
“It was basically ritually committing suicide in front of the entire internet. If there was a checklist of things you could do to kill a company, Reddit was masterful at working their way down that list.
“But I was happy at Hipmunk and I didn’t want to leave. I was the co-founder of that business.
“My deciding moment was my realisation that Reddit is more important to the world now than Hipmunk will ever be. I thought to myself Reddit has incredible potential and it would be a real shame if it died.
“And I thought I could help. And that is the spirit in which I came back to the company.”
Evan Spiegel: “So you saved Reddit from death? Well thank you.
“One of the things that founders are known for, one of the most important parts of the job is setting the culture and building a team that reflects your values and what you want to create in the world.
“How do you define the culture at Reddit?”
Huffman: “That’s a good question. And actually when I came back to Reddit the culture of the company was not aligned with me.
“I spent a lot of time of thinking abut this and how I change it. There were lots of intentional things we did but more than anything, the culture and values of a company really reflects the culture and value of its leadership. And that happens very naturally. You have to actually do more work to make that not the case.
“So when I came back to Reddit in 2015, I think we had 70-80 people and within the first year about 50 of them were gone. We let some people go but a lot of them just left. You can see how quickly people realise ‘it’s not for me’.
“Everything else falls into place once you have the leadership in place.”
Spiegel: “Another famous founder who left and then returned was Steve Jobs. How have you grown from V1 Steve to V2 Steve and what changed?”
Huffman: “Reddit v1, which I guess was Steve v1: we were winging it! We didn’t know what we were doing, we followed our intuition.
“Our product philosophy was that we would build things that we like.
“My thesis was, ‘if I like it, there are millions of people just like me so they’ll also like it.’ Which turned out to be true!
“But it turns out that if you’re trying to build a really large company, there are millions of people like me but there aren’t hundreds of millions of people like me. So intuition can only take you so far.”
“At Hipmunk we had to learn a really important but painful lesson which is: ‘I am not my customer.’
“At Hipmunk we had this idea that people travelled just like me and my co-founder Adam do. But it turns out they don’t. We are actually anomalies. We are consumer travellers who travel a lot.
“It turns out that that doesn’t exist. Consumers travel once or twice a year and business people travel a thousand times a year.
“Having empathy and building products for people that are different from us was probably the most important lesson I learnt.
“And the other big change was that I was an engineer. For the first five years of Reddit that’s basically all I did: write code for Reddit.
“At Hipmunk I was CTO and coming back to Reddit was the first time I was a full-time manager.
“If I went back in time and told my 22-year-old self, ‘you are going to obsess about management, you are going to read every book and talk to people about leadership and management and board structures and you’re going to go nuts for mission and values’, I would have have said, ‘get out, there’s no way!’
“But actually I really love that stuff now!”
“We’re in the ads business. It’s funny because when we started Reddit, we didn’t want to be in the ads business.
“I was an internet idealist. Ads just felt icky. Our starting ethos was that we felt that the whole world is bullshit. Media is bullshit. Marketing is bullshit. Everybody’s lying to us. We just want a place that’s real.
“That’s what we built at Reddit. And one of the things that I’ve learnt is that I used to be cynical about brands. In talking to brands I’ve realised that these people really love the companies they work for.
“For example, we have a community on Reddit called Makeup Addiction. Makeup Addiction is for people who really like make-up. They post pictures of themselves, they give tutorials and ask for advice. And L’Oreal is an advertiser and it’s a really natural fit there.
“One of the lessons I had to learn is that instead of thinking of L’Oreal as an advertiser, I think of L’Oreal as a company who employs people who love make-up so much that they work at L’Oreal.
“And Makeup Addiction is a place for them to hang out.
“Ads on Reddit, I think, are a little bit different. It’s not about blasting your message as loudly and frequently as possible. It’s about being in touch with your customers, with your communities, with people who have the same passions that you have, and it’s an opportunity to create a connection that is very difficult to create anywhere else in the world.
Spiegel: “One of the things that you’ve been really passionate about it is about protecting user privacy. You’ve said publicly that Reddit wasn’t built to collect and sell user information.
“But advertisers sometimes ask for advanced targeting or really detailed profiles of users so that they can better target their messages.
“How do you think about those trade-offs between user privacy and effective advertising?”
Huffman: “I think we come from a similar place in being idealistic about the internet and people’s privacy.
“I very strongly believe in a company that can build great content and ads without violating people’s privacy.
“If you want to target people who wear make-up, go to Makeup Addiction. It’s very simple and straightforward. Even a marketer can figure it out.
“Aligning around people’s interests and values and passions is very straightforward and you’re not violating people’s privacy to do so.
“And also this idea that privacy and advertising are at odds with one another – I’d like to squash that idea.
“Fundamentally, for us, we know things about our users, they tell us things, we can figure things out from the data but we just make it transparent. Let people opt-out, let people reset their data, give them control.
“I don’t think it’s too much to ask that we have that contract between our users. This is how our business works, this is what we can target on and you can opt out if you want to.
“People want relevant ads and they also want to know that the conversation they’re having is authentic and that the company they’re dealing with is telling the truth.”