Pinterest is a hidden unicorn
Pinterest, Silicon Valley’s successful outsider.
Where online social network sites such as Facebook and Twitter have been compromised by the scandal recently, Pinterest is the exception. Its philosophy and unique business model is much less aggressive than the others. This has not, however, hindered its ability to reach 250 million users this summer. Interview with Ben Silbermann, co-founder of Pinterest, Silicon Valley outsider.
San Francisco — Ben Silbermann does not enjoy being interviewed. He is not a fan of speaking at tech industry conferences. He does not think he should have to explain Pinterest, the web service that allows people to save images to virtual pinboards, to anyone other than those who want to use it.
2. That is the case even in the last couple of years, when Pinterest and Silbermann, its cofounder and chief executive, could have been shouting the company’s virtues from the rooftops. Its peers, Instagram, Facebook, YouTube and Twitter, have been drowning in toxic harassment, fake news and Russian disinformation campaigns. Critics have denounced social media-induced anxiety and addiction.
3. Pinterest, by Silbermann’s design, is the opposite: the web’s last bastion of quaint innocence. Having de-emphasized its social media elements years ago, Pinterest aims to be a safe and happy place for inspiration, self-improve- ment and salted caramel cookie recipes. It also rejects Silicon Valley’s typical unicorn formula of moving fast, breaking things, chasing growth at all costs and bragging about every victory.
4. But the reserved, slow and steady approach has long frustrated some investors and employees, who believe that it has neutered growth, according to interviews with more than a dozen people who have worked with or for the company. Matt Novak, a partner at All Blue
Capital, said his firm was trying to sell its stake in Pinterest, which the firm acquired on the secondary market, because it had not lived up to its potential. “If they don’t keep up, they very quickly become prehistoric,” said Novak.
5. And yet despite Silbermann’s approach — or maybe because of it — the company is worth $12.3 billion and growth is accelerating. This summer, the company crossed a new milestone — 250 million monthly active users. The company is on track to top $700 million in revenue this year, a 50 percent increase over last year, according to a person familiar with the company. If Pinterest continues its trajectory, it could change the narrative of what it takes to build a successful company in Silicon Valley, a meaningful feat at a time that the startup world is seeking new templates for leaders.
‘MEASURES TWICE, CUTS ONCE’
6. Tech companies usually reflect the personalities of their founders. Mark Zuckerberg infused Facebook with a “move fast and break things” hacker mentality. Silbermann, 36, grew up in Des Moines, Iowa, in a family of doctors and assumed he would also go to medical school. But his first encounter with high-speed internet, at Yale University in 1999, changed his mind. “You could find your people there and really explore inside yourself,” he said. 7. He has tried to instill that same thinking at the company. Pinterest values “knitting,” a term its employees use to describe collaboration among groups. In the beginning, when Pinterest was desperate to hire engineers as quickly as possible, Silbermann screened potential hires for their values before even considering their technical skills. Silbermann is someone who “measures twice, cuts once,” said Rick Heitzmann, a managing director at FirstMark Capital and early investor in Pinterest.
8. Pinterest has always confounded Silicon Valley insiders. Its first users were not teenagers — the typical early adopters of digital services — but Midwestern women. And Silbermann and his co-founder, Evan Sharp, were not engineers, a prerequisite for many venture capital investors. “From the beginning, this company did things differently from how most storybook Silicon Valley companies have operated,” said Jeremy Levine, a partner at Bessemer Venture Partners, Pinterest’s largest shareholder.
9. The company’s growth exploded by 2011, just a year after its service went live, spawning countless copycats — for families, for music, for pornography, for Lady Gaga fans — and clones in every major country. It seemed possible that Pinterest could be as successful as Facebook, Instagram, Twitter or YouTube — maybe even Google. The market for social media advertising was still young and up for grabs. 10. The business case was simple and powerful: It was a shopping mall disguised as a mood board that held its users’ aspirations, unearthing pure and unfiltered commercial desire. But just as the company began selling ads in 2014, user growth stalled and it was not clear why. Executives on Pinterest’s “growth” team proposed spending $50 million a year to acquire users through marketing, a common tactic for web companies. Other executives argued that the company should court celebrities and pay influencers to share content on Pinterest. Silbermann opposed both. He preferred what he called “quality growth.”
11. Silbermann said, “In technology, people are very, very fast to declare something a winner or loser, like, ‘That’ll never work,’ or ‘That’ll take over the world.’ The truth is always somewhere in between.”
Ben Silbermann, the chief executive of Pinterest.