I had the pleasure of sitting down with my friend and colleague, Doug Knopper, co-Founder and co-CEO of FreeWheel, in the days leading up to the company’s ninth anniversary on February 14th. To mark this special occasion, I asked him to share some stories from the early days at FreeWheel as well as a few insights into how to take a company from startup to a market-leader. Here’s a recap of our conversation:
Jack Rotherham: How did you and co-founders Jon Heller and Diane Yu come together to start the company?
Doug Knopper: Jon, Diane and I first connected during our days at DoubleClick in the early 2000s. I was the General Manager of the Tech division, Jon was the operating officer of the Media division and Diane was the head of engineering for the Tech group I was running.
I left DoubleClick at the end of 2005 to take on a startup in California that we sold in the beginning of 2007 and so I was looking for my next step. Coincidentally, Jon, who had already left DoubleClick before I did, was also in California looking for his next opportunity. As it turns out, we were both looking at similar types of roles; at one point we were actually interviewing for the exact same CEO position. A conversation started that eventually led to the question: why not do something on our own? Jon had an idea, as Jon always has ideas, and we started bantering about the concept and refining it. We decided in late January 2007 to continue forward and went live on Valentine’s Day.
That March, Jon and I realized one of the critical early employees we needed was a head of engineering or CTO. We made a short list of ideal candidates and Diane Yu was one of them. Then, out of the blue, Diane, who I hadn’t spoken to in 18 months, called me and said, “I’m moving to the West coast and interviewing for a CTO role and they also need a CEO, would you be open to doing it together?” My response was, “Hold on, I need to talk to you. I’ve got a different idea.” She signed on in early April, as co-founder and CTO, just before we secured our first round of financing of $2.5 Million.
JR: Back when things were getting started, what were you seeing in the TV industry at the time? What problems were you aiming to solve?
DK: At the time, all eyes in the TV industry were on what was happening in the music industry, which was being decimated by music sharing sites like Napster. For the first time, people were able to get their music for free and didn’t have to buy CDs or records. Then Steve Jobs came along with the promise to music labels to create a centralized repository of all music that would completely re-establish the business model. By 2007, the music industry was starting to re-acclimate itself to this new reality… and waking up to find that Apple had stolen much of their business. Meanwhile, the television industry was watching the music industry implode and thinking, “Is this about to happen to us?”
And so, we came in with our business model and our message to TV companies: you can maintain the rights and ability to monetize your television content wherever your content goes. That was like a breath of fresh air to them. We sat down with the CEO of a major network’s interactive division and his response was, “This is brilliant. This is exactly what we need. You are the saviors of the industry.” And we started getting similar types of reactions from other big enterprise companies. We knew we had hit something really important. Ironically, I credit Steve Jobs for a lot of our success.
JR: Where does the name “FreeWheel” come from?
DK: It was a huge point of discussion in the early stages of the company. Jon and I had many excellent debates over this.
Jon came up with the name FreeWheel, which has two connotations. First a freewheel on a bike is the mechanism that allows the back wheel to spin. We felt that the industry was locked up, but if we could unlock one lane, like the gear on a bike, we could make the industry spin while everything else was locked up. The other connotation for freewheel is irreverent, fun-loving and free-spirited. We loved the play on both those concepts. I will admit that I was hesitant to agree to a company name that has the term ‘free’ in it (there were already too many companies out there with ‘free’ in their names), but in the end, I hate to admit that Jon was right.
JR: You once shared with me that there was a lot of angst over selecting the logo.
DK: Oh my god, yes. For all of Jon’s smarts and infinite wisdom, he is not a good judge of graphic design. He had in his mind what a logo should look like and he drove our designer crazy—we actually wore out three designers. The one we ended up choosing was the ugliest logo maybe in the history of branding. The only thing that remains from the first logo is the two sets of double Es (“ee”) in the word FreeWheel, which was actually my late father-in-law’s idea. He’s the one that pointed out that there’s no other word in the English language that has the double sets of Es. He came up with the backwards ‘e’ and that’s stuck with us ever since.
JR: What do you admire about your fellow Co-Founders?
DK: Everybody told me that setting up the business with co-CEOs and three co-founders wouldn’t work, that we were destined for failure. For seven years leading up to the acquisition in 2014, we made that work, and still continue to make it work now, though with a slightly different model. That’s because the three of us know each other’s strengths, when to get each other involved, how to argue it out and when to compromise. So if you’re asking what I admire about my fellow co-founders, it’s that these three strong-willed, highly opinionated and smart people were able to come together and agree on a direction and make it happen. That’s really unique. In my lifetime I don’t think I’d find this again with three individuals.
JR: What aspect of FreeWheel are you most proud?
DK: When I think about the key to any successful company, there are three things that have to be perfectly aligned: a great product, a great team and great market dynamics.
We were fortunate to have all three of these align at the right time. But to take success to the highest level, you need a fourth element: an amazing culture. We built a culture that’s now the foundation of our core values: we are purposeful, proudly unique and deeply caring. I couldn’t be more proud—in my mind that’s the legacy of FreeWheel and always will be. We’ve created an environment where people like to work, where they have fun at work while still being very focused and disciplined. And yet it’s still a culture that everyone is passionate about even two years after our acquisition.
JR: How can a company stay true to its culture while growing so quickly? Does the culture shift with the people or does FreeWheel only hire people that already match the culture?
DK: That’s a great question and something I think about all the time. In my mind, company culture starts from the center, meaning me, Jon and Diane. From the center, the culture creates a ripple effect that resonates through the company as new people are hired. That’s what makes me proud: the employees at FreeWheel are continuing to build and expand upon the FreeWheel culture—even new hires have the capacity to be as important to the culture as anyone from the beginning. You don’t see that in companies that are growing at the same pace as FreeWheel—it’s a pretty amazing phenomenon.
JR: It’s been nine years since FreeWheel was founded, what surprised you along the way?
DK: There’s a family side of things that I never thought or dreamt about in the early days. People got married and sometimes divorced, so many kids have been born (we even had our first baby FreeWheeler, a child born to two FreeWheel employees), and an employee was tragically killed in a car accident – things that you deal with as a family, but not typically as a company. We’ve had to learn how to, as a company, adapt to some good things and some bad things. It has been fascinating and sometimes heartbreaking to watch.
JR: Talking about the acquisition, how has the Comcast’s acquisition impacted the company?
DK: Let me first take a step back and tell you why we got acquired. From the very beginning, Jon, Diane and I knew, as a venture-backed company, there would have to be an exit, most likely sell the company or go through an IPO. We had agreed from the start that we would sell the company at the right time, to the right buyer.
We had many opportunities to sell, but the one that mattered to us was Comcast. Comcast, as the biggest TV-oriented platform in the world, is helping FreeWheel grow and build our offering on a much bigger scale than we could have done on our own. Comcast’s assets, platform, people, and tools are allowing us to operate at a much higher level. They agree with our vision and let us continue to run the business. Their oversight has been nothing but positive. As I touched on before, we continue to build (and invest in) FreeWheel culture. To say that FreeWheel continues to flourish in the wake of the acquisition would be an understatement. At roughly 500 employees, we’ve doubled in size since 2014. We got everything we wanted out of it— I have no complaints. I would do it again.
JR: Now, turning our gaze to the horizon, what’s next for FreeWheel?
DK: We will keep expanding and strengthening our already strong position in a quickly evolving ecosystem. We want to continue to help the world’s largest media and entertainment companies meet and leverage the volume and velocity of change in front of the television ecosystem today, while continuing to drive their success from our position the center of the premium video economy. So, nothing changes and everything changes at the same time.
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It’s amazing to see how far the company has grown in just nine short years. As Doug mentioned, we now stand firmly at the center of the premium video economy with the world’s largest media and entertainment companies turning to us for our superior end-to-end technology, premium marketplace, and best in market advisory services. Yet there’s so much more ahead—2016 will be a banner year for FreeWheel, as well as the FreeWheel Council for Premium Video, which advocates for the entire premium video industry.
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