David Karp is the founder CEO of Tumblr and Kevin is the CEO and founder of instigram and this panel is on hockey stick growth and both of these founders have experienced hockey stick growth at different stages. Instagram is a much younger company and Tumblr is just taking over the web. What do you, you do like 250 billion impressions a day? 250 million a day. 250 million, I'm sorry, okay. About 7 billion a month now. No 250 million, yeah. Yeah, sorry. So you are 250 Million a day and you were at 250 million a month just a few months ago, right? Yeah, the sort of exponential growth we started to see is really sort of counter intuitive like to think back a year ago how many servers we were ordering. We were thinking about scale it just doesn't apply at all today and looking forward the next six months, planning is an interesting exercise, but often feels futile. Right. I think we have some charts, if we can put them on the screen now would be great. So that's your pretty, I dunno its hard to tell, I mean it's been pretty, what were the inflection points? If you have to look at that, and pick as many inflection points as you want, I mean what's the story that that chart tells you? So, one reason it's been hard to, I dunno, the interesting thing the whole way through is if you slice that chart anywhere and zoom in, it looks pretty much the same at any level along the way it's just that, you know, today the numbers that we're talking about, I think are a bit more substantial than they were, you know, two years ago when even though the graph looked pretty much the same, slope hasn't really, you know, it's always looked like it was tickingout its never been easy to think about, as far as reflection points, the only thing I think that's really pivoted over the last four years is been whether or not most of that growth was international versus domestic. And our first year was almost entirely US traffic. That next year we started to see significant international growth for the first time, to the point by the end of the year, by the end of our second year we were something like 75% international traffic. Then it started to even out and now you can see in that graph, orange is US domestic traffic. That makes up about 40 percent of our traffic today. So it's now starting to, I think, much of the significant growth we've seen over the last six months has been, sort of mainstream adoption overseas. So Brazil, Southeast Asia, Japan, various European countries starting to take to Tumblr the way the US was starting to adopt Tumblr a couple of years ago. So now lets look at the in instagram chart. That's a different scale, what is that scale? Actually how many photos are posted per minute? Per minute? Absolutely. So we are getting about ten photos per second right now. And that was, last time I talked to you, was six or four? It was a few months ago. I mean, I think a lot of what you just said really resonates with us as well which is, you never expect growth to keep growing the way it has been growing until you wake up one morning and you say, that growth we saw last month, that we thought was really large, just pales in comparison to what we're seeing today. And it's really exciting to wake up every morning and see that. I think on this chart, you were asking about inflection points. t's been a pretty steady growth since Christmas of this past year. Christmas day was like this huge day when everyone opened their iPhones and started using camera apps again because the iPhone 4 had this better camera. yours is international versus US. It's interesting because I actually think that our app was international from the very beginning and that actually surprised us. In fact, it was probably more international at the beginning than it is today. I think most of our growth early on was in Japan. And, only now am I seeing large growth in the United States as well. Do you think there's also a difference between mobile and web, and there's a lot of mobile components at Tumblr, obviously, but, if you think back to the, you know, where you were at this stage, right, I mean, is there any advice you have for Kevin? Yeah, Kevin seems to be a few steps ahead of me actually. I think he's been hanging out with the right people. One thing that, most of the stuff that I look back and kinda go man I could've done better was, sort of team building stuff, or more than team, really company building stuff, that it's just, it's easy to start setting up when it doesn't really matter if you kind of fail or need to change things dramatically. You know if you're 5 people or a dozen people it's much easier year to kind of say, okay, this is the scaffolding for the bigger company that we're going to grow into. Rather than, now we really doubled the size of our team in the last 6 months, now we're thirty plus people and I'm holding all team meetings for the first time in our four and a half year history. You know, I could have started practicing those back when we were a dozen people. Right. So, as your usage grows, right? Obviously you have the scale of the technology and that's a big challenge in and of itself. I'd like to hear you guys talk a little about that. And how many server melt downs have you lived through, if you can still count them. But then on the other hand what you talk to here which is not only to scale technology you've got scale of the organization, right? And how do you do that, and does that come up faster than you thought it would, would be you need to fill certain roles that you didn't think you'd have to fill for 6 months and all of a sudden you really need it. So,I'm terribly curious to hear how Kevin's been approaching the what their attitude toward the scaling and the architecture is. I'll tell you that the thing that our investors kind of beat into me for years before it finally clicked, and I sort of accepted or understood it, was it was really just a question that I would get at every board meeting which is, "Is the way that you're thinking about scaling, or the way you are thinking about technology going to scale?" What I now see what they meant was, whatever position you're in and whatever expectations for where your product is going, exponential growth is sort of unfathomable until you cross over to the other side, and all of these steps along the way require completely different solutions. As a scrappy team of two engineers at Tumblr for three years, we wanted to come up with clever solutions and engineer our way out of any scaling challenges which came along. Realistically, negotiating transit, building up multiple data centers and building an application that can, live and write to multiple data centers are things that are really sort of impossibly large challenges for people that haven't been through them before. And approaching it that way of, there are just things that, this is the reason that Facebook has very smartly gone through several, sort of, iterations of their engineering team, bringing in people who have been through these things before and know how to think about this next level of scale and it's why at this point I completely defer to our operation's and engineering's teams who have seen the stuff before, cause it's not stuff where I can help with anymore and it's not a place where I can be clever anymore. How are you in terms of all of these companies that just take off, whether it was Twitter or Tumblr. Right? You have these periods where it's down, and everyone makes a big deal about it because it's not available. And if people start to rely on a service, it becomes noticed when it's not available. It's been a few weeks since the last time I heard that Tumblr was down. Where are you? I would say first of all, when that stuff happens its absolutely heartbreaking, I mean it's like the most gut-wrenching experience in the world and I don't think absolutely gut-wrenching experience. Well lets see, what took, it took me too long to realize that for us it was actually that we needed more resources, we needed to be in more data centers, we needed a bigger engineering team. And interestingly, if you actually zoom out and look at our all last-team meeting, we looked at that traffic graph next to our up-time graph for the last year. And you can see nine months ago, when it started getting a little bit rocky where we had, you know, fantastic up-time and performance for years before that, all of the sudden, we were hit with this growth that, again, it was that exponential growth that's, just sort of, impossible to imagine where you're, you know, you're just, like, OK we're ordering, you know, how ever many servers a week and in a few months we'll be ordering this many servers a week. You don't realize that, like, you know, it's a lot of work for your managed data centers to set up racks of servers. They might be fine to turn on one server for you a day but all of a sudden you place an order for 10 racks and they're like, okay give us a couple of weeks. And you know, it It's a completely different world and a completely different set of solutions. Anyway, the graph that we looked at was watching our up-time get kind of rocky over a few months, and then our down-time in December, we had a major outage that took our site down for a day, which was like the most painful thing in the world. And, it happened that in December was when we started to do our real push for hiring, recruiting really spectacular engineers. We quadrupled the size of our engineering team since December, and if you look at our up-time graphs since then it just straight slope or its actually very steep slope straight up and out or back to several nines up time. And you have great 404 error. Getting better, yeah. The thing that was really important to us through this whole experience was that, or has been really important to us, is making sure that that's not something that kind of defines our company. I think it was sort of a stigma that hasn't quite left Twitter. I think all of these stigmas you can leave behind. I think generally it takes somewhere between three months and a year before people...The internet has a very short attention span and very short memory. Have you had any big meltdowns Kevin? Yeah, we had actually the first day, we launched and we had no idea we we're going to be as big as we became. And that first day we were on a single computer in a managed data center. And I still remember my co-founder Mike, calling them up and saying, "We need another computer," and they're like, "It will be 6 hours." And we didn't half six hours, so we ended up moving to Amazon actually for everything and I think it's a trend now with a lot of the smaller start-ups including ourselves to move to the cloud because of the flexibility that you have with growth. On the downside, you're paying more than you would if you owned your own assets. But that flexibility I think really allows you to scale. At least at our level, very quickly. And then...
But then when
Amazon's down...Yeah, when
Amazon's, so it's, you know, but at the same time if you do Amazon correctly you don't face those things and I think a lot of people were in one availability zone and that really bit everyone in the butt so. Let's talk a little bit about, this is a high quality problem to have obviously. Right? It's a great problem. Can you manufacture growth, or do you just build the best product you can and what happens happens? I'm not sure you can manufacture growth, actually you can, but I'm not sure it will be sustained. Like you see this in the app store all the time. We live and die by you know the top three apps right, and you see apps that have a one-star ratings pop to the top and you realize that something is going on there, so you can manufacture short-term growth but I don't think that long-term growth, the nice growth you want to see in a products, you can manufacture outside of building a great product and outside of building a great team that builds that great product. When you build something that people really want it turns out it spreads really well. And I think, you know, from day one we saw that there was something special about this thing we call Instagram, like, the second we put it out people really resonated with it. Our job was to really support that government. Right, so if anyone has questions we can come up to the mikes and I'll call on you. One thing I like to talk about is, it seems to me and correct me if I'm wrong, but for Tumblr, I would guess that a lot of the growth is sort of, feeds it on itself. It's sort of in turn, just the way the product is designed, right? Yeah. People reblog and you know, the traffic is coming from other Tumblr blogs. So 90% of our new registrations actually come through the, come through blogs on Tumblr. That's 90%, so that means the other 10% are people typing in tumblr.com directly, googling, I don't know. Blog platforms or something. But 90% come from the Join Tumblr button up in the corner of blogs, the Follow button on blogs, typing in Tumblr after you've visited a blog on Tumblr so you're, you know, trying to investigate what this thing is that they're using, or clicking the Powered by Tumblr link at the bottom of the screen. Not huge, you know, promotion or anything and there's, frankly, pretty little incentive to sign up. It's not like you have to register to comment on those blogs or to interact with them. But people see these things that people are doing with Tumblr and it inspires them to want to try that for themselves. Right. And that's a pretty cool feeling, and I also think that's one reason our retention has been so good. So 85% percent of those new people who signed up are still posting a week later, which is spectacular. And for you how much is it internal growth versus, I think you did a really great job of Using Twitter and you know Tumblr, and Facebook and all these other social channels that exist to spread the, you know, like i want to broadcast my photos right? And just looking at it, I dont necessarily, if I happen to open an Instagram then I'll go through the feed, but really I look at it because I see my Twitter feed and I click through, right? Yeah. So how much are you using these external networks to drive the growth? External networks certainly drive the most growth that we have. It's great when your growth strategy is also aligned with your product strategy. Our growth strategy was: get out on other networks; allow people to broadcast their photos to existing networks, while building bootstrapping one underneath. That's because we felt like that solved a problem for people. People wanted to take pictures and have them shared on multiple networks all at once. So, that simple fact of of our product strategy aligning with the growth strategy has been fantastic for us. Right. So if you look at other photo apps, there's like this proliferation of photo apps right now, even in the start-up battlefield. And if you look at Path or Color, which took a more private approach, you can understand why philosophically they did that because they wanted to maybe share things that people don't want to share publicly. But I think that hurt them. I mean definitely, like yesterday, opened up Color,Keith here opened up Color. There's no other pictures in this crowd. So nobody is using that. I think that that's an issue. For Path, for instance, I think that they would be much more popular if there was more of a public sharing, which now they have sort of like Facebook. There's a lot of founders here who are doing, not just photo apps but other apps, that they're trying to figure out, like closed groups versus public groups. What's the pros and cons. go one way versus the other? So for us, we took a really strong bet on the follow model to begin with, because we hadn't seen that done on photos before in a really strong way. There was no network out there, that we felt like embodied that follow model, and we wanted you to allow you to discover people anywhere in the world. I think that that simple bet--and it was a bet, by the way, because it wasn't clear that it was going to take off in any way at the time--that simple bet allowed us to grow because it meant you could use the service without knowing any of your friends on it. You could discover cool people to follow anywhere in the world, and I think that really aided our growth early on. Tumblr is just much easier to think about in terms of product. If you look at Flickr, which was sort of, absolutely the home to photos for many years, which tried to include public and privacy controls, it leads to very convoluted settings pages; it leads to a lot more overhead when actually creating content because you've got a whole bunch of boxes to check, and define what groups you want this to go to, and whether you want this to show up on your main Source: http://feedproxy.google.com/~r/Techcrunch/~3/Chq2umQviYY/doodle for google chuck norris john stamos flowers online kendra wilkinson invincible funny or die
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