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Overview
"In the grand tradition of Ben Mezrich's The Accidental Billionaires (2009)... an engaging look into a fascinating subculture of millions." —Booklist
"Breezy...How to Turn Down a Billion Dollars ably if uncritically chronicles the short history of a young company catering to young users, with a young chief executive, and reveals, intentionally or not, the limitations that come with that combination." —Wall Street Journal
The improbable and exhilarating story of the rise of Snapchat from a frat boy fantasy to a multi-billion dollar internet unicorn that has dramatically changed the way we communicate.
In 2013 Evan Spiegel, the brash CEO of the social network Snapchat, and his co-founder Bobby Murphy stunned the press when they walked away from a three-billion-dollar offer from Facebook: how could an app teenagers use to text dirty photos dream of a higher valuation? Was this hubris, or genius?
In How to Turn Down a Billion Dollars, tech journalist Billy Gallagher takes us inside the rise of one of Silicon Valley's hottest start-ups. Snapchat developed from a simple wish for disappearing pictures as Stanford junior Reggie Brown nursed regrets about photos he had sent. After an epic feud between best friends, Brown lost his stake in the company, while Spiegel has gone on to make a name for himself as a visionary—if ruthless—CEO worth billions, linked to celebrities like Taylor Swift and his wife, Miranda Kerr.
A fellow Stanford undergrad and fraternity brother of the company’s founding trio, Gallagher has covered Snapchat from the start. He brings unique access to a company Bloomberg Business called “a cipher in the Silicon Valley technology community.” Gallagher offers insight into challenges Snapchat faces as it transitions from a playful app to one of the tech industry’s preeminent public companies. In the tradition of great business narratives, How to Turn Down a Billion Dollars offers the definitive account of a company whose goal is no less than to remake the future of entertainment.
Product Details
| ISBN-13: | 9781250108623 |
|---|---|
| Publisher: | St. Martin's Publishing Group |
| Publication date: | 02/13/2018 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 294 |
| Sales rank: | 809,272 |
| File size: | 11 MB |
| Note: | This product may take a few minutes to download. |
About the Author
Read an Excerpt
CHAPTER 1
RUSH
APRIL 2010
STANFORD, CA
Sam leaned against the shopping cart, forearms bulging as he pushed with all his strength, picking up his pace from a trot to an all-out sprint. On most days, he used his athleticism to play wide receiver for Stanford's football team. Tonight, he was using that same athleticism to push his friend Stuart in a shopping cart because they were freshman boys trying to get the older guys' attention at fraternity rush.
Pushing Stuart off a makeshift ramp designed for frat bros to tricycle over seemed like a good way to make an impression. It was working. As they rounded the corner of Kappa Sigma's parking lot, several fraternity brothers standing on the concrete steps and sidewalk realized that these freshmen weren't using the normal Target-bought tricycles.
Where the hell did they get a shopping cart? one of the guys thought as he joined his brothers and started cheering as Sam steered the cart around the turn of the parking lot.
Stuart, a thin, goofy kid with his dark brown hair in a bowl cut, sat in the cart, looking diminutive next to his friend Sam and wondering why he'd thought this was a good idea. The Jack Daniels had initially calmed his nerves, but Sam was pushing him pretty damn fast. He didn't have time to rethink things.
Sam whipped the cart around the corner of the parking lot, its wheels rattling over bits of broken beer bottles. The parking lot's lone light cast a faint orange glow over the scene. The cart went up on two wheels as it turned; Stuart almost fell out, but Sam grabbed it and slammed it back down.
Steadying the cart, Sam sprinted toward the hastily constructed ramp and threw the cart forward into the warm California night.
The plywood ramp sagged atop its cinder block supports. Rather than soaring gloriously into the air as the boys had intended, the cart slid right off the end, its old wheels digging straight into the asphalt with a harsh screech. The cart violently ejected its cargo — Stuart flew through the air and tumbled end over end against the hard asphalt.
The onlookers paused.
Rolling over, Stuart rose gingerly. He turned and looked back at the group watching him and triumphantly raised his fists in the air over his head, like a snowboarder who had just won Olympic gold.
The older brothers exploded into hollering and cheering. This kid was getting a bid.
Evan Spiegel smiled and sipped his beer from a red Solo cup, watching the chaos from the crowd. Tall and lanky, Evan had brown hair that he kept short and styled up across his sharp, angular face. He was often seen partying on campus in a tank top and shorts. As a sophomore rush chairman, Evan held the keys to the kingdom for these potential newcomers. All around him, nervous freshman engaged in the same small talk with active brothers: Where are you from? What freshman dorm are you in? Did you play any sports in high school? How's freshman year going?
All told, there must have been more than a hundred people there, milling about between the makeshift tricycle track in the parking lot and the fraternity house. The freshmen had come sporting a variety of attire, from the East Coasters in polos to Southern Californians in tank tops, most trying too hard to look cool and casual at the same time. All the brothers were wearing yellow t-shirts for rush; the front depicted Curious George passed out next to a tipped-over bottle of ether. The lower right side of the back showed a small anchor with the fraternity's letters, K?, on each side — it was Evan's signature. The anchor was his way of saying, "This is an Evan Spiegel production."
Evan was born on June 4, 1990, to a pair of highly successful lawyers. His mother, Melissa Thomas, graduated from Harvard Law School and practiced tax law as a partner at a prominent Los Angeles firm before resigning to become a stay-at-home mother when Evan was young. His father, John Spiegel, graduated from Stanford and Yale Law School and became a partner at Munger, Tolles & Olson, an elite firm started by Berkshire Hathaway's Charlie Munger. His clients included Warner Bros. and Sergey Brin.
Evan and his two younger sisters, Lauren and Caroline, grew up in Pacific Palisades, an upper-class neighborhood bordering Santa Monica in western Los Angeles. John had the kids volunteer and help build homes in poor areas of Mexico. When Evan was in high school, Melissa and John divorced after nearly twenty years of marriage. Evan chose to live with his father in a four-million-dollar house in Pacific Palisades, just blocks from his childhood home where his mother still lives. John let young Evan decorate the new home with the help of Greg Grande, the set designer from Friends. Evan decked out his room with a custom white leather king- size bed, Venetian plaster, floating bookshelves, two designer desk chairs, custom closets, and, of course, a brand new computer.
From kindergarten through senior year of high school, Evan attended Crossroads, an elite, coed private school in Santa Monica known for its progressive attitudes. Tuition at Crossroads runs north of $22,000 a year, and seemingly rises annually. Students address teachers by their first names, and classrooms are named after important historical figures, like Albert Einstein and George Mead, rather than numbered. The school devotes as significant a chunk of time to math and history as to Human Development, a curriculum meant to teach students maturity, tolerance, and confidence. Crossroads emphasizes creativity, personal communication, well-being, mental health, and the liberal arts. The school focuses on the arts much more than athletics; some of the school's varsity games have fewer than a dozen spectators.
In 2005, when Evan was a high school freshman, Vanity Fair ran an exhaustive feature about the school titled "School for Cool." The school, named for Robert Frost's poem "The Road Not Taken," unsurprisingly attracts a large contingent of Hollywood types, counting among its alumni Emily and Zooey Deschanel, Gwyneth Paltrow, Jack Black, Kate Hudson, Jonah Hill, Michael Bay, Maya Rudolph, and Spencer Pratt. And that's just the alumni — the parents of students fill out another page or two of who's who A-listers. Actor Denzel Washington once served as the assistant eighth grade basketball coach, screenwriter Robert Towne spoke in a film class, and cellist Yo-Yo Ma talked shop with the school's chamber orchestra.
Evan was attracted to technology early on, building his first computer in sixth grade and experimenting with Photoshop in the Crossroads computer lab. He would later describe the computer teacher, Dan, as his best friend.
Evan dove into journalism as well, writing for the school newspaper, Crossfire. One journalism class required students to sell a certain amount of advertising for Crossfire as part of their grade. Evan walked around the neighborhood asking local businesses to buy ads; once he had exceeded his sales goals, he helped coach his peers on how to pitch businesses and ask adults for money.
By high school, the group of 20 students Evan had started with in kindergarten had grown to around 120. Charming, charismatic, and smart, Evan threw parties at his dad's house that were "notorious" in his words. Evan's outsized personality could rub people the wrong way at times, but his energy, organizing skills, and enthusiasm made him an exceptional party thrower. He possessed a bravado that could be frustrating and off-putting but was great for convincing everyone that the night's party was going to be the greatest of all time.
Obsessed with the energy drink Red Bull and the lifestyle the brand cultivated, Evan talked his way into an internship at the company as a senior in high school. The job involved throwing parties and other events sponsored by Red Bull. Clarence Carter, the head of the company's security team, would give Evan advice that would stand him well in the years to come: pay attention to who helps you clean up after the party. Later recalling the story, Evan said, "When everyone is tired and the night is over, who stays and helps out? Because those are your true friends. Those are the hard workers, the people that believe that working hard is the right thing to do."
In the fall of 2008, Evan burst onto the campus scene at Stanford. Known as "The Farm" because Leland and Jane Stanford founded the school on their old Palo Alto farm, Stanford has an idyllic 8,000-acre campus in northern California, just south of San Francisco. He lived on the top floor of Donner, a three-story all-freshman dorm. Evan quickly became friends with the guy who lived right across the hall from him, Reggie Brown. Evan could not possibly have imagined it at the time, but meeting Reggie would become one of the most important things he did at Stanford.
Reggie was born on January 17, 1990, in Isle of Palms, an affluent coastal town just outside of Charleston, South Carolina. Reggie had a masterful way of making people feel welcome and comfortable around him, like he was genuinely interested in getting to know you. He could come across as a goofball at first, as he smoked and drank and made lowbrow jokes, but he was deeply intelligent and creative. Reggie knew from the day he got to Stanford that he wanted to be an English major and focus on writing. Reggie was a beefy, good-looking kid with shaggy blonde hair that was typically tucked under a backward cap. A wide, silly smile usually brightened his face. His Southern manners set him apart in Northern California, as he would frequently address professors and friends' parents more formally.
Evan and Reggie spent a lot of time partying together. The group in Donner was unusually social that year, not least because the two fast friends frequently threw parties in their dorm. This was not common for freshmen because it was frowned upon. These gatherings were typically lubricated by handles of vodka and Red Bull Evan had shipped to him, as he was still working for the company as a brand manager, giving out free samples.
Most freshmen did not have a car and were adjusting to life without their parents. Evan drove a Cadillac Escalade and thrived in his new environment. In addition to his ever-growing group of friends he met through his and Reggie's parties, he started dating a pre-med student named Lily, and they were soon attached at the hip.
Lily was a steady, positive influence on him. She was a very patient, understanding girlfriend and put up with some of his absurdity because the good times — from fraternity parties to adventures for just the two of them to a spring break trip to Cabo San Lucas in Mexico — were so much fun.
Throughout the year, Evan designed and printed tank tops for his Donner crew. He had befriended the owner of a printing shop and was able to negotiate discounted prices and short turnarounds on orders. Evan created a tank top mimicking the Stanford athletes' Nike gear. The shirts said STANFORD across the chest, but instead of a team sport underneath "Stanford," it read HUSTLING. In the spring, a friend tossed out the idea for a "Sun's Out, Guns Out" tank top; later that day, Evan emailed the dorm a Google doc to collect people's orders and sizes, and by Friday everyone who paid him could rock their shirt.
By the time spring quarter arrived, Evan's reputation had grown — he was the kid from LA who liked to throw parties. Most of his Donner crew joined a fraternity or sorority that spring. Reggie, Evan, and their friend Will rushed the Kappa Sigma fraternity.
The Kappa Sigma brothers had a work-hard/play-hard ethos; they prided themselves on being able to excel on campus while drinking and throwing ridiculous theme parties. The leaders of the house typically did very well academically and balanced sports teams and other extracurricular commitments with heavy drinking binges. The Stanford Flipside, the school's beloved Onion wannabe, summed up the culture best with an article titled, "Kid Vomiting in Stall Next to You to Run Fortune 500 Company Someday."
In April 2009, Evan, Reggie, and Will were awoken in Donner by Kappa Sigma brothers, offering them Natty Lights and little manila bid cards — invitations to join the fraternity. They were in.
Evan and Reggie took widely divergent routes through the fraternity pledging process. Most of the new members went with the flow during pledging and did what the older brothers told them to do. Evan constantly questioned: Why do we do it this way? Why are we letting other people tell us what to do? Why can't we go do this? Reggie, on the other hand, simply couldn't be bothered to show up or take pledging seriously. During the process, the older brothers frequently wrote out the pledges' names on a big whiteboard and gave them points for tasks well done, events they showed up to, and generally how much they were liked by the active members. Reggie was always at or near the bottom of the list.
While he didn't put any effort into the setting up, cleaning up, or planning of parties, Reggie excelled at one part of the process: the parties themselves. All pledges were given tasks: one had to carry a lunchbox around to classes, another had to roller blade around campus, and a third had to wear a bike helmet to every party. All received nicknames as well: Reggie earned the nickname Blue Suit, given every year to the pledge who parties the hardest. He was handed down a baby blue men's suit that was rarely, if ever, washed. He had to wear it to every party, adding more layers of liquor stains to its illustrious history.
Evan moved into the Kappa Sig house his sophomore year and was assigned a room in the Mid, so named because it was located right in the middle of the house, where the bedrooms met the kitchen, lounge, and chapter room to form a T. Five pledges lived in two small bedrooms, with a larger common room connecting them in the middle.
Choosing to live in the Mid meant committing to a quarter4 where keg stands would take precedence over classes. Mid residents who wanted to get homework done had to escape the fraternity for the library. And it was difficult to get to bed before two o'clock in the morning most nights, as fraternity brothers would drink and party or smoke and play Super Smash Bros. on a beat-up N64 in the middle room. In the larger common room of the Mid, Evan and his friends would throw regular weeknight parties, inviting everyone they knew.
Evan had a private text group with a bunch of the girls in his year to which he'd regularly send mass texts like, "Raging tonight at Kappa Sig, be there." Almost inevitably, Evan's Thursday-night parties would explode into all-campus events. Sorority girls, overeager freshmen, and jaded-but-drunk seniors alike would wander over and cram into the Mid to slam back Natty Lights, take pulls from plastic handles of bottom-shelf vodka, and forget that they had class the next morning. During these parties, Evan was in his element. He could often be found sitting on top of a speaker DJing in a tank top, gauging the mood of the crowd, and making sure everyone was having a blast. He even came close to getting LMFAO, a hip-hop duo best known for their "Party Rock Anthem" hit, to come play at one of the fraternity's parties.
Fraternity life posed a continual challenge for Evan — he always wanted to take things to the next level. Instead of planning mere parties, he constantly increased their vision and scale until they became planned events with specially built props and specifically designed tank tops. "Spiegel, we can't do that" became the most common phrase uttered at house meetings. Evan would type up ridiculous event descriptions for emails and Facebook invites, describing parties in the most absurd, dramatic ways.
Evan was elected a social chair and quickly went way over budget. As Stanford's football team embarked on their first winning campaign in nine years and the busy student body started to pay attention to the games, Evan pushed to make tailgates into bigger spectacles. For every home game, he would cart his own enormous speakers down to the dirt parking lot next to Stanford Stadium. The Kappa Sig brothers invited every girl they knew and threw a full-on frat party in the parking lot. Evan worked the crowd with ease, greeting people left and right with a thin, wide smile on his face. When his head wasn't thrown back laughing, he was typically drinking from his red Solo cup or gesticulating with his long, gangly arms to make a point. The tailgates kept growing, week after week, riding the unstoppable waves of the football team's success and Evan's party-throwing acumen.
In addition to obsessing over his parties looking a certain way, Evan had already begun to think about his future. Evan decided to study product design, to learn how to look at the things he used in his daily life and see how he could make them better and cooler. David Kelley, the head of Stanford's famed design school, took Evan on as his advisee. One thing was clear; as he frequently put it, "I'm not going to work for someone else." And this gave him freedom from the heavy grind of Stanford. Nobody would ever see his résumé or grades, so he took classes for what he actually wanted to learn.
(Continues…)
Excerpted from "How To Turn Down A Billion Dollars"
by .
Copyright © 2018 William Gallagher.
Excerpted by permission of St. Martin's Press.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Table of Contents
Author's Note ix
Prologue: Initial Public Offering xiii
Part I An Evan Spiegel Production
1 Rush 3
2 Future Freshman 14
3 Million-Dollar Idea 20
4 The Other Startup 29
5 Lawsuit Possible 40
6 The Fight 47
7 Snapchat 50
8 Sexting 62
9 Betrayal 69
10 A Not-So-Innocent Toy 76
11 Poked 83
12 Reggie's Return 89
13 The Phenomenon 94
14 Stories 104
15 How to Turn Down Three Billion Dollars 109
16 Happy New Year! 123
Part II Toys are Preludes to Serious Ideas
17 Hangover 129
18 The More Personal Computer 133
19 Snapchat Everywhere 141
20 Goodbye Reggie 150
21 Snapchat Live! 155
22 "We Need to Make Money" 163
23 Blank Space 171
24 Discover 177
25 Major 187
26 Keeping Secrets 198
27 Evan's Empire 206
28 The Road to IPO 212
29 The New TV 218
30 Discover Falters 223
31 Fear and Loathing in Menlo Park 231
32 Snap Inc. 240
33 Spectacles 247
Acknowledgments 253
Works Cited 256
Index 281