Skout, a mobile application for flirting and dating, is already growing like crazy.But CEO Christian Wikilund has much, much higher aspirations than just a dating app — he wants to build a global network on the scale of Facebook and Twitter.
Right now, it looks like he’s on track — Skout is adding 40,000 to 50,000 new users on the app every single day.
What does he have planned? We caught up with him to find out — here’s what we learned:
- Dating and flirting actually only comprises about 20 per cent of Skout’s use cases. Most use it to just meet new friends — though that’s based on a survey, which is a little self-selecting, he said.
- They spend a ton of effort keeping the app clean. Every picture has to be reviewed four times to make sure Skout doesn’t become the next “ChatRoulette” and be a database of nude photos.
- One pivot later, Skout raised $22 million and is ready to grow, well, everywhere. The app already has huge user bases in some international cities, but it’s planning on expanding to just about every international market out there.
Here’s a full, lightly-edited transcript of the conversation:BUSINESS INSIDER: So, start from the top. How did you guys get off the ground?
CHRISTIAN WIKILUND: I would say we’ve been in under the radar for quite some time. We haven’t had much hype at all, we’ve just been building the product. We’ve been around for some time. We started in 2007 and we were a competitor to Loopt and Whirl and all these cool location-based services for you and your friends. Facebook didn’t have a mobile product. If we can build a location-based mobile social network, that’s the differentiator.
At that time, you couldn’t get access to location — we were talking to carriers and they wanted to charge $.40 per look-up. So we were using manual location entry. I couldn’t find my friends based on street address. We couldn’t get much traction. Google Latitude launched, Loopt sold, most of the others don’t exist any more. The whole industry thought, “location is happening now,” but it didn’t really happen. We had a small following of users that were very excited, but we couldn’t feel we could get consumer traction. So we looked at what current users are doing with the app and where can we build something more exciting.
Online dating was one vertical in particular that we felt was quite stale and we had no innovation for years. There were tens of thousands of dating sites in different markets all over the space, and we said we should go after this. The first launch, we were the first dating app for the iPhone. Since then, we’ve transitioned to a slightly broader area — meet new people and flirt.
BI: So has the mission of the company changed since launch? What are you guys focused on now?
CW: The mission for the company is to build a global network for meeting new people. That’s one of the untold mysteries online. Facebook built a global company around the social graph, Twitter built the global company around the interest graph. No one has built the global company about meeting new people. At the end of the day, meeting people will be part of the Skout experience. We’re doing some really exciting things that we’re gonna be launching this summer. With our pivot, we’re doing great, it’s really how can we help as many people as possible in the world to meet new people.
BI: Things weren’t always doing this well though. Can you tell me what it was like before you pivoted? CW: Well, you spend 12 months building the product and it’s all the anticipation of launching. You load up the office with beer and champagne and click the launch button and, nothing happens. Whoops. When we launched, it wasn’t exactly like that, not an overnight success, but it grew gradually.
The decision to change, it took a few months for us to talk, things were not working. We were not a big company that you had to convince, 18 months ago we had just 3 people and now we’re 60. It’s really nice, at that moment we could have said screw it, we’re not gonna try and let’s kill it. But we really believed in the space and we wanted to see it through. I’m really glad we stuck with it. Those moments happen gradually over time, you know when something isn’t working and we need to seriously consider something else. At the same time, you need to give it time to bake in. A lot of entrepreneurs leave the game too early, we felt it was the time to do something different but we didn’t just jump overnight.
“A lot of entrepreneurs leave the game too early, we felt it was the time to do something different but we didn’t just jump overnight.”
It’s really in the past year that we’ve really taken off. A year ago we had 30 million messages a month, last month we had 425 million messages. We were signing up a year ago 100,000 per month. Now we’re signing up 40-50k users per day. Everything has been growing, basically due to a good product. In the early days, every new release we do is fork-lifting the whole business. Engagement increases, virility increases, session length increases.
BI: You guys have raised a ton of money. What are you using it for?
CW: For us, when we first started talking to them we were break even for the past 4 months. Since we raised this money we’re not gonna be profitable this year. The metrics speak their own language, it’s growing really nicely. The overall opportunity is huge, the next billion people that are going online in their lives are gonna do it on a smartphone. How many people need to meet new people?
With Skout, we have a doable footprint. Our launch in Hong Kong and New York City. We’re big in the middle east and Japan, South Korea, Berlin, LA. We actually exploded in Puerto Rico, I don’t know why. We’re now growing in Sao Paolo, we built a service that we hadn’t really localised the experience for the middle eastern markets. It helps on one that we’re using services like Facebook to connect. There’s this untapped market for people who want to see new places and meet new people and spread their wings. That’s where we want to help people to meet new people and see new places and enrich their lives via real world connection or virtual connection. We don’t distinguish if it’s a real world connection or a virtual connection.
All of our users do both, they use it in San Francisco to meet locals and go to concerts. We were looking at the opportunity and we’d raised some major money before, and we felt the opportunity was being capped by not having a bigger war chest. I want the company to be the largest network in the world, we should be everywhere. I don’t want to take one market by market, I want to push everything as quick as possible. We have to hire people not only in San Francisco but also abroad. We need more engineers, we had one systems engineer that was trying to scale the whole infrastructure and that wasn’t physically possible. We need more iOS developers, back-end developers. It’s a product-focused company, making sure that the product moves faster forward and that the servers are up and running.
BI: A big focus now seems to be dating. Will that change any time soon?
CW: End of day, I think a great product can be a product what you want it to be. Some people just use it for dating, some people use it for meeting new friends, some use it for entertainment, like they just want to chat with someone. If you look at demographics, there are more and more single households, single people, people are moving into big cities and to some extent people are getting more lonely as well. We’re working harder and getting disconnected. The typical use is a young professional who just moved into the new city. You have your first gig and you’re working long hours and it’s hard to find the time to meet new people.
Using Skout can be a great extra platform, you can do it continuously throughout the day. Our users, they use Skout almost like they would use text messaging. They don’t sign in for one hour, instead they sign in 9 times per day and spend two to three minutes per session. You don’t have to commit an hour at a time, you can bring it up and send a few messages. You can use it actively or passively and it fits well into the lifestyle. I think the tie is much bigger than just dating, but dating is a subset of the network for meeting new people.
Right now, 50 per cent of adults on a national level are single, but 80 per cent of our users are single. We have a higher concentration of single people than the national average. We did a survey, and surveys are surveys, but found 80 per cent were now using it for finding new friends. 20 to 25 per cent said they were there for dating. It’s hard to know, though — did they want to be perceived as finding new friends?
I want Skout to be as inclusive as any social event, may it be a death metal concert or a bar. It’s a place people go to socialize. Will there be flirting, yes. Do we have to provide a good experience for that? Absolutely. But will there be friendships made? Of course there will be. I think there are definitely more use cases. The product today in the app store is more skewed toward flirting. I do think the space is much bigger than just dating and flirting. We’re doing a huge launch this summer which will help that. We’re redoing the whole UI and it’s really beautiful, it’s a cool release.
BI: What’s are the goals for this year?
CW: This year it’s two big things for us: really keep pushing the product forward, that’s the most important thing, and anchor our experience better internationally and grow internationally. In January we had 20 people in the company, now we’re 60 and we’ll probably hire another 60-80 this year. We’re moving into a new office in San Francisco in the next month. It’s a super-exciting time for the company, for me personally to experience the next phase so to speak.
BI: How do you keep the app safe for users and keep it clean?
As a company, we’re definitely not done innovating. We’re still in the experimental phase, and we want to keep being fast and nimble. It’s all based on product and keeping the community clean and safe. We all remember Chatroulette, what happens when you let things roam free. We’ve banned 40,000 users every month, we’ve developed very strict procedures and policies on what’s acceptable, how we address people who shouldn’t be on the server. We took the stance that anything that’s not socially acceptable during lunch time in San Francisco should not be accepted on Skout either. You don’t see people walking around naked in the middle of the street so people shouldn’t be walking around naked on Skout either. We have a zero tolerance for douchebaggery.
“You don’t see people walking around naked in the middle of the street so people shouldn’t be walking around naked on Skout either. We have a zero tolerance for douchebaggery.”
Every user can report other users and we have a 24/7 support staff. We have algorithms to identify bad behaviour by looking at engagement patterns. We do a really good job and it’s one of the most important functions of the company, community management. Facebook, of course there’s bad stuff, but you have a social graph that keeps people in check. You don’t post certain kinds of pictures, it sort of self-polices. On Skout, you don’t have a social graph, you’re there by yourself and a small per cent of people will say, “wow there’s no one here watching me so I can behave in an inappropriate matter.” Every picture you post will be reviewed by four people, all four people have to agree that it’s G-rated. We put a lot of emphasis and work into community management. That’s been one of the reasons we have been able to grow. You know how chat rooms work in the past — it can get out of hand if you don’t keep it tight.
It’s another reason we don’t do check-ins, it’s a network for meeting new people. If you declare where you are, it’s a privacy violation. If you get closer than half a mile, we don’t show he’s within half a mile. You just know a person is in the area and can engage in a chat and ask to meet up somewhere.
BI: Do you still expect to make money if you shift the focus away from dating?
CW: Our revenue model is, we don’t charge for communication or to use the service. We just charge for extra fun, like seeing who checked you out or promoting yourself. You don’t have to spend a single dollar using our service. That’s a beautiful part of it, that we’ve been able to grow a large network. We’re monetizing certain things around that. My bet is that it’s still gonna work. It’s more interesting long-term. One of my goals is to build the largest pool of cross-demographic users.
There will be fun stuff happening in the location-based advertising space. But there’s the promise that when you know more about me and it’s 5 p.m. in San Francisco and you know I’m in the South of Market neighbourhood, then why don’t you send me a relevant ad instead of an ad that I don’t care about. Hey, there’s a happy hour, here’s a happy hour coupon. When you can combine real agility in ad units, you have a real win-win for advertisers. It’s not something we have planned for now but there’s some real interesting advertising. We would never sell the information, it would be an advertising platform. There’s regulations coming as well, you’re watching a show on comcast and you’re getting personalised ads and people are people freaking out about that. They know Christian is 31 and likes UFC. I think there’s probably something where you can combine a guide and get more recommendations. My habits, I go to the same restaurants every day. I would love to expand my list of restaurants and get recommended. If that can be tied to some kind of human, that would be awesome.
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