Hey! Justin here, and welcome to another edition of Just Go Grind! This post is available in its entirety for 🔒 premium subscribers 🔒 of Just Go Grind. Free subscribers have complete access to 1-2 editions per month. I spend 20+ hours researching and writing about one world-class founder each week, sharing their story and best insights with you. Thank you to the 738 of you who joined since the last edition and all 20,261 subscribers!

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On to today’s piece!

Evan Spiegel

In 2015, at only 25 years of age, Evan Spiegel became the world’s youngest billionaire.

He got there by building Snapchat into one of the fastest-growing consumer apps and turning down a massive acquisition offer from Facebook.

But, like many great ideas, Snapchat was dismissed early on. Many people just didn’t understand how this groundbreaking idea of disappearing photos would appeal to a large user base.

Today?

Snapchat has more than 375 million daily active users and a market cap of more than $17 billion.

It’s been a wild journey to get here, from a subpar launch to a major lawsuit to leaked emails to having competitors blatantly copy them and much much more.

Let’s get to it.

Early Days

Evan grew up in Pacific Palisades, an upper-class neighborhood on the west side of Los Angeles.

Both of his parents were successful lawyers, with his mom, Melissa, choosing to resign when Evan was born and his dad, John, being a partner at the law firm Munger, Tolles & Olson.

Evan’s interest in technology started early and as a sixth grader, he built his first computer with the help of his teacher, Dan.

For high school, Evan attended the Crossroads School for Arts and Sciences, a private school known for its many celebrity alumni and parents.

While Evan would later become known as a product visionary, his fascination with design started when he was a teenager, after taking a graphic design course taught by Milka Broukhim at Otis College of Art and Design during one summer:

Evan would continue to experiment with Photoshop at Crossroads where he also worked at the school’s newspaper and even sold ads for it as part of his journalism class, walking around his neighborhood to sell to local businesses.

In his senior year of high school, Evan got the experience of working for one of the world’s most well-known brands, Red Bull:

Evan’s next experience, attending Stanford, would be one that’d change his life forever.

Stanford & Future Freshman

In the fall of 2008, Evan chose to attend his father’s alma mater for college, studying product design at Stanford and, by the end of his freshman year, getting into one of the fraternities on campus.

But the most important pieces of his Stanford experience for our story today?

One is how he got his first real introduction to the world of entrepreneurship.

Two is how being in that environment at Stanford introduced him to a couple of his classmates who he’d eventually start the precursor to Snapchat with. More on that soon.

Evan’s introduction to entrepreneurship came from his experience auditing a graduate-level class taught by Peter Wendell, founder of Sierra Ventures. Through the class, Evan was able to hear from guest speakers like Eric Schmidt, the former CEO of Google, and Chad Hurley, the co-founder of YouTube.

Another speaker was Scott Cook, who founded Intuit, and, after attending his session, Evan would end up getting a job for a short time working for Scott and an engineer at Intuit on a project called TxtWeb, getting to experience a high level of accomplishment working with a small team.

Evan was sold on wanting to build a startup and he’d do just that when he was recruited by a classmate, Bobby Murphy, to work on a new social network. While the project ultimately went nowhere, it wasn’t a waste.

When Evan had the idea for his next company, Future Freshman, he recruited Bobby to write the code.

Future Freshman would be described by Evan as:

They launched Future Freshman in the summer of 2010, but by the fall, with Evan and Bobby both studying abroad, Evan in Cape Town and Bobby at Oxford, it ultimately failed.

Not only did Future Freshman struggle to keep their attention, it wasn’t resonating with users and was battling other well-financed companies.

Even though they shut it down, it was an important experience, allowing them to understand that they worked well together and showing Evan that he needed a more original idea to build his next startup.

The original idea he needed would soon come running to him.

Disappearing Photos

Evan met Reggie Brown during his freshman year at Stanford. They lived across the hall from each other and eventually were in the same fraternity where, a couple of years later, they were both kicked out.

Reggie was a notoriously hard partier, which, as it turned out, ended up being important.

Why?

Because through that partying, he came up with an idea in Spring 2011 that he told two friends in his dorm room:

They laughed it off.

But who did he tell next?

Evan Spiegel.

Evan was immediately excited and reportedly called it “a million-dollar idea.”

They talked more in-depth about the company and decided to split it 50-50 with Evan being the CEO and Reggie being the CMO.

But they needed someone to write the code for the app.

After two people turned them down, Evan decided to reach out to Bobby who, while not initially convinced people would want to use the product, eventually decided to join them.

The first version was less than ideal, but they quickly pivoted, as told in the book, How to Turn Down a Billion Dollars: The Snapchat Story:

They wouldn’t release a web version until September 2022.

And that product sense in the early days would come in handy in the years that followed.

Building on the initial idea, Evan worked to refine it as part of a design class he was taking at Stanford, with a final presentation showcasing a prototype that didn’t exactly blow people away:

A few days before that presentation, Evan had emailed a few of his old fraternity brothers about the app, asking them to try it out.

Unlike the insane early reaction to Instagram, which had tens of thousands of downloads on the day of its initial release, or Facebook, which spread like wildfire at Harvard, Picaboo’s launch fell flat.

There were only a few dozen people who downloaded the app initially, mostly Evan’s friends.

But, Evan and his co-founders liked the idea enough to continue working on it that summer, moving to Evan’s dad’s house in Pacific Palisades.

Launching Picaboo

Working from Evan’s dad’s house, they launched Picaboo in the iOS App Store on July 13, 2011.

It was a massive success, right?

Wrong.

They only had 127 users by the end of the summer.

Worse than that?

A rift had already started forming in the team.

While Evan and Bobby were working hard building and designing the product, Reggie wasn’t contributing all that much.

Worse yet, having recently turned 21, Reggie was enjoying the Los Angeles nightlife a bit too much for what was needed to build what they thought could be the next big thing.

The misalignment was causing resentment - Evan and Bobby felt like Reggie wasn’t pulling his weight on the team.

Furthermore, Reggie was struggling with the marketing, positioning Picaboo as a sexting app, a very limiting use case that Evan tried hard to change into more of a fun picture-sharing app for friends.

After a night out with all of them celebrating the completion of their beta version of the app, Evan and Reggie got into a drunken argument about the lack of work Reggie was doing. Reggie would later overhear Evan and Bobby talking about replacing him with someone with more marketing experience.

Cooler heads would prevail the next day, but this wasn’t the end of it.

Even though there weren’t that many users for Picaboo initially, they had insane retention numbers for those who were using the app. While they were targeting 30% for their 7-day retention (The number of people who come back a week later after opening the app), by the end of July, when Reggie had flown back home to South Carolina to see family and work remotely, that number was 60%.

And Evan did a few important things around this time to help Picaboo grow:

• First, he stepped in to help with marketing, getting introduced to an aspiring model and her sister who agreed to do a photo shoot for Picaboo. The pictures would be used as screenshots for the Picaboo app in the App Store and on the website. Most importantly, they would quickly capture people’s attention when they were viewing the app.

• Second, he worked with Bobby to make the camera for the Picaboo app load more quickly than the default camera app on the iPhone by getting rid of the animation that would normally occur when you would open the iPhone camera app. The goal? Make Picaboo the default camera app for people.

• And finally, he worked on PR, securing their first target, a blogger Evan liked named Nicole James.

Oh and that rift in the team?

Yea, it got a whole lot worse:

You read that right.

Brown was kicked out.

But it wouldn’t be until nearly two years later, in February 2013, that he would file a lawsuit against Snapchat, at a peculiar time when Snapchat’s valuation was exploding. The case was ultimately settled, later coming out in the S-1 that Reggie was paid a total of $157.5 million.

So wild.

But that’s enough about that.

We’re here for Evan and Snapchat.

Let’s continue.

Snapchat is Born

It’s the fall of 2011, Evan returns to Stanford for his senior year, and Bobby gets a job in San Francisco.

Their company is now down to just the two of them and they get a cease-and-desist letter from a photo-book company with the same name so Evan and Bobby change Picaboo to Snapchat, re-launching Snapchat in the App Store on September 26, 2011.

This is the date they now use for the founding of the company.

More importantly, their app starts to take off:

But wait.

What fueled that growth?

A few things.

First, Evan and Bobby continued to improve the Snapchat product itself, adding photo captions to the app, letting users draw on top of the photos they took, and adding hidden features that delighted users when they discovered them.

Second, Evan was relentless about getting users, trying everything he could to get people to sign up, from handing out flyers at the shopping mall to convincing an entire class to signup for Snapchat before a lecture.

And not only did Evan’s cousin’s friends download the app at their school, but other high school students in Orange County and Los Angeles downloaded it too, spreading it to their friends.

Another important thing to note is that Evan had positioned Snapchat to be the anti-Facebook, Twitter, and Instagram.

There were no likes or retweets.

You couldn’t upload your email contacts or log in through Facebook.

Snapchat was something you used with your friends and you could only add them if you had their phone number or their Snapchat username.

Also, at least in the early days, users couldn’t upload photos from their camera roll - they had to be taken in the app and shared immediately.

All of this created a level of intimacy and made Snapchat feel cool.

By the end of January 2012, Evan and Bobby had increased their daily active users 10x from their December numbers, reaching 20,000 daily active users.

It was time to fundraise.

Raising Funding

By February 2012, the server costs to run Snapchat were growing, reaching $5,000 per month and increasing daily.

Evan and Bobby were maxing out their credit cards to pay the costs by the time they reached 40,000 users.

After talking to a former professor at Stanford he suggested they talk with venture capitalists or angel investors.

So Evan went out looking for funding.

But it didn’t go well.

Sequoia Capital passed.

Benchmark Partners passed.

Chris Sacca, an early investor in Twitter and Uber, wouldn’t even take a meeting.

However, fate would intervene:

Lightspeed invested $485,000 at a $4.25 million valuation while Barry Eggers, a partner at Lightspeed who sat on the board of his daughter’s high school’s investment fund, convinced the fund, Evan and Lightspeed to let the fund invest $15,000 as well.

As soon as the wire hit on Evan’s Wells Fargo app while he was in class at Stanford, he dropped out, weeks before graduation.

They were off to the races.

Turning Down $3 Billion

By April 2012, Snapchat continued its crazy growth, reaching 100,000 daily active users.

That summer, they were signing up more than ten thousand people per day to Snapchat.

By October, they launched the Android version of their app and more than 20 million photos were being shared daily.

Clearly, the narrative in the media at this time of it simply being a “sexting” app was wrong.

In February 2013, Evan raises a $13.5 million Series A led by Benchmark, who had stayed in touch with Evan since passing on the seed round, valuing Snapchat between $60 million and $70 million.

Only a few months later, they raised another round of funding, valuing the company at $860 million. As part of that financing, Evan and Bobby each sold $10 million worth of their shares in a secondary offering.

And their team had grown significantly:

This team launched Snapchat Stories in October 2013, an incredible feature that certainly got the attention of other companies in the space.

One of them?

Facebook, which would copy the stories feature a couple of years later.

But at this point in time, Facebook was thinking of an acquisition.

After meeting with Mark Zuckerberg in Los Angeles, Evan and Bobby were offered around $3 billion to sell Snapchat to Facebook.

Three.

Billion.

Dollars.

They went back and forth on the decision at a time when they had no revenue and no business model.

They turned down the offer.

It would have made them each worth hundreds of millions of dollars.

Why did Evan do it?

He had a couple of reasons.

One, he explained in Forbes:

Another time, during commencement at USC in 2015, he offered up another explanation:

By January 2014, Snapchat had 35 employees and made a number of acquisitions that year.

Evan also had to deal with the shitstorm that came after emails were leaked of his fratboy days at Stanford that made him look very very bad.

Oh and remember that lawsuit from Reggie Brown? That was settled in 2014 as well.

What a year.

The next year would be much better for Evan and Snapchat would continue to expand.

Youngest Self-Made Billionaire

Discover as well as Lenses (Snapchat Filters) was launched by Snapchat in January 2015, not only expanding the functionality of the app but bringing on board a number of publishers.

Snapchat also built its own content arm at that time:

And Evan continued to focus, saying no to opportunities that didn’t make sense for their users:

Evan cares a lot about the product, thinks about the product constantly, and it’s not surprising he’s been called a product visionary, especially given who he admires:

Clearly, this was all paying off, because in 2015 Evan became the world’s youngest self-made billionaire.

But he was only just getting started.

Snap Inc.

In 2016, Evan went on another spending spree for Snapchat, acquiring Bitstrips for $100 million in March, Obvious Engineering in July, and Vurb for $114.5 million in August.

On September 24, 2016, Snapchat rebranded to Snap Inc. and announced Spectacles, a $129 hardware product that had been in the works for years.

Evan raved about the early prototype he first tested in 2015 with his fiancée, now wife, supermodel Miranda Kerr:

By this time, Snapchat has 150 million daily active users and growth just continues.

It’s also later reported that around May of 2016, Google allegedly was interested in buying Snap for $30 billion.

Obviously, that didn’t happen, because the next year, Snap went public.

Going Public

In March 2017, Snapchat goes public under the symbol SNAP.

A November 2017 article, written by Evan, gives a glimpse into how he views the company:

When Snap released a redesign of their app in 2018 and pissed off a lot of users, Evan’s vision would certainly be tested, but he explained at the 2018 Code Conference why they did it:

Of course, at this time, Snap is a public company, and Evan also has to build trust with their investors, something he talked about in 2018:

Evan is leading a team of 3,000 people at this time.

Their ability to innovate, again and again, is vital.

And, as I’m sure you have heard about Facebook copying Snapchat repeatedly, Evan has a response:

Struggles, Hardware, and What’s Next

Jumping ahead a few years, in 2022, Snap had to undergo big layoffs.

In August they laid off 20% of their 6,400-person team and killed off Pixy, their flying selfie drone.

When asked at Code 2022 about competing with well-funded companies in the hardware space, Evan offered up this:

Evan would launch Snapchat+ in 2022, a paid offering starting at $3.99/month, and by April of 2023, Snapchat+ would have 3 million users.

While it’s a small percentage of their 375+ million daily active users, it’s encouraging.

And Evan’s latest move?

Launching My AI in February 2023, essentially integrating ChatGPT into Snapchat, a feature which more than 150 million people have already interacted with and more than 10 billion messages have been sent.

It’s remarkable how far Snapchat has come from a “sexting app” that people just didn’t understand to a public company that has withstood numerous challenges and continues to grow.

Where will Evan take Snapchat next?

I don’t know, but it’ll be fun to watch him continue to innovate.

Evan’s Wisdom

In each edition of the Just Go Grind newsletter, I like to include a few more quotes at the end from my research into the founder who is featured, sharing their wisdom.

On the practice of council:

On utilizing coaches:

On building an organization with a culture of ongoing innovation: