On this episode of Contrary Radio, Josh Abramson of College Humor, BustedTees, and Vimeo tells us about:
Building a media business as a freshman at the University of Richmond
Running experiments that ultimately led to BustedTees and Vimeo
Team culture and how opportunities pop up
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00:00 Will Robbins: Hello and welcome back to Contrary Radio. I’m your host, Will Robbins. In this episode, I talk with Josh Abramson the co-founder of CollegeHumor, BustedTees and Vimeo. We cover how Josh started a media company his freshman year at the University of Richmond, running experiments that ultimately led into BustedTees and Vimeo, and team culture. Let’s jump in.
00:34 WR: Hey, Josh. Thanks for taking the time to talk!
00:38 Josh Abramson: Yeah, of course.
00:39 WR: So in 1999, right before the dotcom bust, you were freshman at Richmond, your best friend Ricky was a freshman at Wake Forest. What’s the story behind the early days of CollegeHumor when you guys were just putting fun stuff online and once you started to turn that into a business?
00:54 JA: Sure. So when I was in high school, I used to play the piano at a local restaurant, like a country club on the weekends and was able to make quite a bit more money than most of my friends were making working, like minimum wage sort of jobs that were available to 17-year-olds. And when I got to college, I didn’t have that job anymore and was sort of scratching my head, like “How am I gonna make this work?” ’Cause my parents were paying my tuition but that was about it. So if I wanted to drink beer or do any other thing that was fun, I was gonna have to come up with that money on my own. So that was really the genesis for just thinking about ways to make money but without having to go work in like the campus bookstore.
01:42 JA: So my brother at the time was working at Advertising.com. He’s about 15 years older than me and he would tell me… Whenever I talk to him about, just how their business worked and how they had a couple of different people who had websites that they were sending these big checks to every month. It got me thinking about what was a way to get people to come to a website and then I could sell ads against it. Basically just planted the idea of what a media business is in my head. I didn’t know it was called a media business for many years after that but that was the framework that I was working with.
02:22 JA: My buddy, Ricky, we’ve been best friends since we were in middle school, he actually knew how to build a website. He wasn’t a programmer but he knew how to actually put a website online. So I thought we should try and figure out a way to do this. And we throw some ideas back and forth. And then I had the idea for CollegeHumor.com which was basically… At that point in time, there were no real popular websites that people would go to find funny things. This was five years before YouTube existed. This was obviously many years before Facebook. So if you wanted to watch funny videos or look at funny pictures, they were literally on individual computers and you would have to go from your dorm room to someone else’s dorm room, and see what they had on their desktop. And then people would put their computers on the network and you could go browse.
03:21 JA: Our friend Brett has all these funny videos. So you go and watch his videos, and then you would go to another person’s. And we would spend so much of our time just going between each other’s dorm rooms. “Oh, you guys gotta see this one.” And then I was like, “Oh, send me that. I’m gonna put it on my hard drive.” That was what the first couple of months of college was like for me. And it was also an interesting time because most people… If you went to school of your freshman year in 1999, there’s a good chance that you didn’t have high speed internet until you got to college, your first day.
03:54 JA: People went from not really using computers much in high school to then being in a dorm room like you are right now where your whole living space is focused around a desk with a computer on it. And that was a really unique moment for everybody because everybody is on the computer all the time. So that was really what got the wheels turning. And I remember going through one of the registration websites and thinking about names. And so when the CollegeHumor was available, I was like, “That sounds pretty good. I’m just gonna buy that.” So bought that domain, built the website, launched in January and initially just took all of the videos and pictures from the different kids on my hall and put them up on CollegeHumor, and we would update it everyday.
04:51 JA: And then I went around in school and put flyers with jokes and stuff, and funny pictures over urinals, and with the address CollegeHumor.com underneath it. And then saw that the more flyers I put out the more people that came to the website. So then I drove to other schools and did the same thing, and then I got friends at different schools that were not driving distance… I would send them literally like FedEx people a stack of flyers and I will give them a T-shirt that says CollegeHumor on it. And that was really how we got the initial traffic to CollegeHumor.
05:26 JA: And then very quickly, it became… It started to feel a little crazy because I think three months in, we got a check for $6,000 for the month which, again, that was probably about as much money as I’ve made in my entire life up until that point. I was just putting funny pictures and videos on our website and from that point it just started to grow. I wouldn’t say exponentially but at a pretty good clip, month over month.
06:00 JA: And by the time the dotcom bubble had burst, call it, a year or two later, we had already had enough traction where we made some money. We made the decision at that point when… ’Cause the way it works back in those days is you could just put ad code on the top of your website and you would just get paid a flat CPM. Nobody was really looking at conversions or even clicks as much. It was very early days so not super sophisticated on the ad tech side. It was really easy just to get money if you’ve had an audience up until the dotcom crash.
06:47 JA: And then that all changed which has ultimately led us to thinking about more cost per acquisition types of campaigns to like figuring out how to sell stuff to people. So we started off trying DVDs on Amazon. Can we sell those as well? We can sell a couple but the margins aren’t that good. We messed around with selling posters. Posters did really well and if you work for AllPosters.com. I don’t know that CollegeHumor would have made it through my college years. And then ultimately, T-shirts proved to be a really good way to monetize the traffic.
07:28 JA: While we were in that period of post-crash pre me learning how to actually sell real brand advertising, we were doing a lot of those types of campaigns which were more difficult. But it also felt very real because if you’re actually getting someone to buy a product, there’s real currency exchanging, changing hands as a result of that. I just felt like it was a real business in a way that it didn’t feel super real to me in the beginning because it was almost too easy. So that was sort of…
08:07 WR: Just to push on what you said earlier about making the shift from web ads to actually building relationships with advertisers and doing more business development to sales stuff, one of the nice things about running an internet company is that nobody really knows that you’re a 19-year-old doing everything from your dorm room until you tell them. What was it like to start shifting into those more managed relationships where you couldn’t just throw up a slice of code?
08:33 JA: It took years. It really wasn’t until, I would say, 2004 that we started to get real brands like Toyota to start working with us. And even that took a long time to figure out how to do that and we started building out an ad sales team of people who had actually worked at… It was funny, I remember talking to somebody about ad sales who was much older. I moved to New York when I was 23. I felt like I had been successful in starting this website but it was still really small by any standard. And I was talking to some people and someone suggested, “Well, you should just hire someone who sells ads at Maxim.” I said, “That’s a good idea ’cause that’s a pretty similar brand to ours.”
09:24 JA: So I literally picked up the phone and called Maxim’s ad sales department. The person who picked up the phone… I just said, “Hi. Do you sell ads for Maxim?” chuckle They said, “Yeah.” I was like, “Okay, this is weird but would you wanna come work for me chuckle selling ads for my website CollegeHumor?” And the guy was like, “Oh, I’m sorry. Actually, I’m really happy here at Maxim. Thanks for calling.” I was like, “Okay.” So I hung up the phone and then five minutes later he calls me back from the bathroom or something. laughter He’s like, “Let’s meet up.” So then that guy ends up coming to our office the next day and was our first ad sales hire.
10:01 JA: And having somebody who had actually been through that process and seeing what it looks like at a bigger company was really helpful. And that was really the beginning of us figuring out how to sell into agencies and sell direct to brands. Before then, I was spending time… I would spend an hour on the phone with somebody for a $300 ad deal and then all of a sudden we weren’t taking deals any smaller than $5,000, $10,000. That number kept going up and up.
10:33 JA: But, yeah, you’re right. It is difficult as a really young person. Although I think it’s easier today because everybody see the social network, everybody is aware that there are young, smart people who are building interesting businesses. It wasn’t the case in the early 2000s. I have very vivid memories of people. Some of whom I still see around the city every now and then who were really not supportive of us in the early years and just treated us like we were kids that didn’t know what we were doing. And maybe we didn’t know what we were doing but I don’t know that we sort of deserved that treatment, but that was kind of the way that it went in those days.
11:18 WR: Totally. Yeah, I feel that. And I love that Maxim story a lot. And you haven’t really mentioned this explicitly yet, but for example, Jakob, one of your earliest business partners, he reached out to you cold, and you and Zach had the idea at one time of reaching out to a bunch of CEOs and just seeing what would happen. It seems like a lot of those random serendipitous encounters were pretty instrumental to your long term success, right? Would you say that’s true? Was that intentional?
11:44 JA: For sure. I think everything I’ve done, really, is derivative from that. The only truly original idea I had out of nothing was CollegeHumor, and then everything kind of fell out of that. Were we not forced to figure out how to actually sell product to people, we wouldn’t have tried selling t-shirts, and if we hadn’t tried selling t-shirts, we wouldn’t have launched BustedTees. Vimeo was my business partner Jake’s idea. That was really born out of the fact that we were all making videos for CollegeHumor, and he was probably the most… Not probably. He was the most active of us in terms of actually making videos day to day. And he was also the only one of us who could code, so he thought it was interesting that everybody was sort of poised to begin carrying cameras in their pocket. And this was before smartphones, but even at that point, the flip cameras had just become a thing, and I just remember him saying, “This is crazy. Everyone’s gonna have a camera really soon and you need to be an engineer to upload a video to the Internet and share it.”
12:55 JA: So Vimeo, when he first launched it in the end of 2004, was the first website that you could as a consumer, just a regular human, go and upload a video and share it with friends or… It really was meant to be social, and in a way, it’s actually more similar… The first version of Vimeo is more similar to Snapchat or Instagram, in a way, than it was to what is today, YouTube. The idea was, you’d upload these short video clips, and we actually strung them together, not unlike Instagram Stories, or previously, Snap. And the idea being that short videos, strung together as a more compelling way to interact into a few of your friends’ lives than just a bunch of pictures. So that was the original idea, and it was really about sharing videos with friends and family. And we didn’t really think of it as a place for people to upload videos and sort of… The idea for… Or what YouTube ultimately became, and I think Vimeo, to a lesser extent today, was not really the initial idea.
14:07 WR: Huh, that’s really interesting. I didn’t know that. And between that and then the t-shirt business, the posters business, it seems like you really spent a lot of time just experimenting and seeing what worked and what didn’t. Was that really deliberate? And I guess a related question might be, how did you decide when to spawn new things versus cut them off?
14:28 JA: Deliberate in the sense that we were… I’ll say this, CollegeHumor, in my head, was always sort of a means to an end. Even in college, I thought… I wrote a resume a dozen times and like was constantly revising it with my accomplishments on CollegeHumor, and I never sent it out to anybody, but I was constantly thinking about, “What’s my resume gonna look like? What kind of job am I gonna get after college?” It never occurred to me that I could just continue to be an entrepreneur indefinitely. And CollegeHumor, just by virtue of its name, I guess I always felt it was something that would be cool to do in college, but then I would do something else after college. And it wasn’t until my senior year that I decided I was gonna do it after school.
15:11 JA: And I remember the conversation was, I had an internship at an investment bank the summer after my junior year of college, and I remember sitting in a phone booth in London, talking to my business partner Ricky and basically having the conversation, “Why don’t we just do this after school?” At that point, we were making almost as much money as we would have made even if we had gone and worked at an investment bank. So it seemed like a pretty low-risk thing. So we were kinda like, “All right, well, let’s just do this.” But I think that idea that CollegeHumor was a means to an end sort of always stuck in my head and I thought, “All right, well, at least we have some revenue. Let’s go get a house or something, somewhere, and just see if we can build other cool stuff.”
15:58 JA: And also, again, back to the differences between 2003 and 2018, at that point in time, I really felt there were so many ideas and so many of the things that have grown into huge businesses, we had a lot of those ideas, but you can only do so many things. Whereas today, I think it’s more of the opposite, where you have an idea for something and you do a little bit of digging and you’ll find 10 Ivy League teams across the country who are working on that same idea. Just everything is very, very competitive. There’s a lot of people who are trying to build these types of businesses. Again, that was not the case in 2003. It just felt very… It’s just like a land grab of sorts. I think that was amplified by the fact that there’s no tech crunch, there were no resources to sort of read about what was going on. So even if things were happening, there was no way to know that they were happening, just ’cause people weren’t talking about it. So it really felt like we could do anything.
17:04 JA: And I think, in some cases, when you know about the businesses, obviously, that have been successful, but we’ve probably started half a dozen or more businesses that you haven’t heard of ’cause they didn’t work. We literally built a social networking site for college kids in 2002 that just didn’t… Wasn’t the right… We didn’t get it right. But it’s exciting to sort of think back on those moments, because if we waited two years and thought about it slightly differently, could it have been Facebook? Probably not, but maybe it would have been something bigger than it was. And it was such a unique moment for us, just having all these opportunities there, and I think the benefit and the curse of being super young is not being afraid to try a lot of stuff, but also lacking maybe focus. I think if I could go back and do it again, I probably would’ve handled it a lot differently, but maybe would’ve not built Vimeo, or… You know what I mean? Who is to say how it would’ve actually turned out?
18:14 WR: Totally. And for any founders listening, was there anything that might have predicted which experiments would fail and which would succeed, or anything you would have done differently?
18:24 JA: Not really. I’ve always been somebody, as an entrepreneur, who’s focused on revenue immediately. And CollegeHumor was exciting to me because I knew that I could make money very quickly. The t-shirt business, we were selling t-shirts the first day we launched. Vimeo was really difficult for me because we built this really cool piece of software, people loved it, it started to get a lot of traction on the user side, but the more people that used it, the more money that it cost, and there was no clear monetization plan. And the business that Vimeo has built around premium accounts, we were years away from thinking about that, and ultimately, it wasn’t us that came up with that. That was the second owners of the business after we sold it. And the advertising business didn’t really make sense for Vimeo. We kind of tested the waters a bit there. So Vimeo was always a thorn in my leg. It was this thing where it was sort of a squirrel in the middle of the road when the car is coming, and I wasn’t sure if I should go this way and try and be really conservative and spend as little as possible or go the other way and just try to invest more and make it into something big.
19:40 JA: And I think YouTube, by comparison, those guys were only focused on YouTube and they had a lot of capital and they were able to just go for it and with no governor on the speed with which they were trying to achieve what they wanted to achieve. So I think that… Just thinking about the framework for how to start these things, what can allow you to grow businesses out of other businesses, it’s a tricky one, and I think… I’ve heard a lot of people talk about different strategies around incubation and that sort of thing, and I don’t have a solid process that I could write into a textbook or anything like that. It’s always been super opportunistic. I always think about it as, you walk into a room every day and there’s a couple doors and you can pick which doors you open, and then you go into another room the next day and there’s more doors. And that’s before you know you found your way into something or not. But it’s really hard to know what the next day’s doors are going to be. And I think every one of the businesses that I started, it required having something else work a little bit to have the idea to kind of go along with that thing.
21:09 JA: So I think sitting in a room and just coming up with an idea from scratch is really hard, and everything that I’ve worked on ultimately takes a very different shape in the end than what the initial idea was. So much of it is just doing it. And I’ve given advice to people before, and this is sort of arbitrary, but at least in my experience, somewhere around three to six months is the amount of time I’ve spent on a handful of businesses before deciding, “Alright, this is a bad idea. We shouldn’t do this.” But it wasn’t until three or four months that I started to realize, “Alright, here are the reasons why this is a lot harder than I thought it was gonna be,” or “Here are the reasons why this just isn’t as good of an idea as I thought it might be.” But it’s really hard to just sit in a room and have those conclusions, because you just don’t know what you don’t know in the very beginning.
22:08 WR: That all make sense. And to go back to one thing that you mentioned earlier about you not taking a big financial risk doing CollegeHumor out of school just because you were already making money, I think one of the under-appreciated components there is that you had already worked so well with your close friends and you had a great team that you could really rely on to experiment, to have fun, to just build something meaningful and take risks. How did that culture develop? Was it deliberate at all? And what sort of role did it really play?
22:34 JA: Yeah, it was the opposite of deliberate. It was totally just natural, and I think… I started the business with my best friend. We brought on Jakob to be our first developer within six or nine months or so of starting, and we’re only 18 at the time. By the time we graduated from college, we lived together for a year in what was basically an upgraded dorm room in San Diego. And then, we moved to New York City and we got a much nicer apartment. And at that point, our fourth partner, Zach, had joined full-time. And I think we just all had a lot of respect for each other.
23:20 JA: It was also pretty unique, in that there are four of us who are all very good at something that the other wasn’t good at, if that makes sense. So we had… Jake was an amazing product guy and engineer; Zach is this incredible designer; Ricky’s on the sort of editorial and sort of content side, just as a general creative person is fantastic; and I was sort of the person focused on the business side of things and marketing and that sort of more nuts and bolts kinda stuff. And I think, as a result, we would find ourselves in meetings where people would ask the four of us a question and it was never unclear who was going to answer it. We were sort of finishing each other’s sentences.
24:02 JA: And we would go out to parties, I remember, all the time, people would just ask what our band was called. They just assumed we were in a band. We had that energy. And I think, having started businesses since then and thinking about continuing to start businesses as my career continues, I think that’s the one thing that I will be the most nostalgic for, is sort of that time which you just can’t replicate it as a 37-year-old with two kids and a wife at home which is also lovely, but it’s just a different…
24:34 JA: I think you have this window as a 20-something entrepreneur that is really special, especially if you can match up with the right people, that you sort of have a vision together and you enjoy spending time together. And I think, ultimately, the culture that we built and which I’ve seen built in many other companies is often sort of derivative of founders’ relationships with each other, and we just sort of hired people that we liked. And again, by virtue of the fact that everybody was in their 20s, we were… Every weekend we were sort of going out together as a group, even as our company grew, and I think that was felt throughout the office. And when you watch some of those early CollegeHumor videos of the lip-dub, none of that was fake. These were our real friends, and it didn’t really occur to any of us that like, “Oh, we shouldn’t have our employees all be our best friends,” but that’s sort of just naturally what happened.
25:37 JA: So yeah, it was a pretty special culture as a result of that, and one that’s certainly hard to replicate by design. I think it just sort of has to happen.
25:48 WR: I love it, that’s a ton of fun. So yeah, I think that’s all the time that we have today, Josh. So again, I really enjoyed chatting, and thanks for taking the time.
25:56 JA: Yeah, of course.
26:00 WR: And that concludes another episode of Contrary Radio. Thank you so much for listening. If you wanna find us on the web, we’re at contrarycap.com and we’re on social media @contrarycapital. Thanks!