Virgin Media Business chose three companies whose simple ideas led to massive success while positively disrupting their marketplace.
Stripe
The story of Stripe and the Collison brothers is nothing short of remarkable. As is widely known, by the time John and Patrick were 20 years old they had become millionaires, shaken up the tech community and revolutionised the world of online payments and an underlying theme to their route to the top: "let’s keep it simple".
School will only teach you so much
Having accomplished so much in business you’d probably expect to see a glittering academic career in the lead up to their professional life. However, their real education happened outside of the classroom with the brothers teaching themselves code in the 2000’s by building websites. They were increasingly frustrated with state-of-the-art websites (for the time) having antiquated payment systems. The brothers enrolled in the prestigious MIT and Harvard universities in Massachusetts. By this stage the brothers had been discussing for years the idea of making payments online a whole lot easier. The "keep it simple" mantra appeared to go into overdrive.
In June 2010, Stripe received seed capital from Y Combinator to get up and running. In May 2011 they received a $2 million investment from venture capitalists Peter Thiel, Sequoia Capital, and Andreessen Horowitz.
Sequoia Capital are one of the longest running and most successful venture capital companies in Silicon Valley and have invested in more than 250 companies since 1972, including Apple, Google, Oracle, PayPal, YouTube, Instagram, Yahoo! and WhatsApp.
“Founders build roads, not cars”
When they began working on Stripe, the Collison’s set out to solve a problem rather than build a business. Patrick is often quoted as saying: “Founders build roads, not cars”.
There were some online payments systems in existence at the time, but installation was cumbersome. Stripe works seamlessly with its pre-built integrations system and numerous product features available to all platforms.
Stripe offers a simple and straightforward pricing scheme. They charge a small fee on each transaction. With Stripe now processing billions of transactions and having received more rounds of funding, the company is currently valued at $9 billion.
Dollar Shave Club
In round numbers the global razor blade market is worth approximately $7 billion annually. The US accounts for $3 billion of that market and one company, Gillette, owned by Proctor & Gamble accounts for about two thirds of the US market.
Enter the Dollar Shave Club
The idea for this company was generated over a few drinks at a party in 2011 where Michael Dubin was complaining about the cost of shaving just as Mark Levine was describing how he had a warehouse full of quality shaving products that he was trying to offload after a failed business venture.
The two men set up the subscription based Dollar Shave Club butwith the business up and running, orders were not coming in at the level the founders had hoped for.
Michael Dubin wrote and starred in a video ad. In his attempt to make his company stand out he created this tongue in cheek classic video commercial. This unique approach captured the zeitgeist. DSC would grow to command approximately 60 per cent of the online razor blade market.
In 2016 Unilever reportedly paid $1 billion for Dollar Shave Club. Gillette responded by adjusting their prices down…eventually!
Tough Mudder
Tough Mudder was the brain child of Will Dean while he was studying at Harvard Business School. He wanted to create a physical challenge based on team work, not leaving anyone behind and working together to achieve collective goals.
Up and running, literally
Tough Mudder held its inaugural event at Bear Creek Ski Resort, Pennsylvania in May 2010 and midway through 2013 they received their one millionth event registration.
While the growth in participants and therefore the company was beyond expectations, Dean noticed he may have an issue with his demographics. The Tough Mudder product set needed an easier event that would appeal to those outside the young male demographic.
Dean also doubled down and broadened the product set by adding a much more challenging event called The World’s Toughest Mudder.
Building a community
In 2016 Tough Mudder noticed that about 15 per cent of people who sign up for an event don’t show up. A common reason for not participating was the people had failed to train properly. To counter this, Tough Mudder created a training programme and converted a floor of the Tough Mudder office in New York into a gym. He then invited people who had signed up to events to come and train there.
By focusing on the community aspect rather than the fitness, Dean created a loyal tribe and a global business.
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