Each month, Startup Grind, an event series designed to educate, inspire, and connect local entrepreneurs, hosts guest speakers to share their entrepreneurial story with our community. They talk about the challenges they faced, how they overcame them, and what they’ve done differently since then. This past Wednesday, we had the privilege of hosting Matt Rutledge, founder of Woot and current President of Mediocre Laboratories.
His story:
A Texas native, Matt got his start as an entrepreneur at the age of 22 when he started Synapse Micro, a computer hardware distributor. In 2004, after growing Synapse Micro to over $50 million in revenue during the previous 10 years, Matt launched Woot.com, a daily deals site founded on the concept of selling one deal per day.
Coupled with the outrageous daily deals (updated each night at midnight), his team at Woot had a wild flair for poking fun at its products. Initially, people visited the site for the daily deals, but it wasn’t long until Woot amassed a following that came just to read the snarky product descriptions.
In 2010, after serving millions of customers and generating hundreds of millions in revenue, Woot was acquired by Amazon. After several years at Amazon, Matt left to rejoin the startup community with his newest venture, Mediocre Laboratories. Mediocre is an ecommerce incubator set up to launch “experimental ecommerce” business models with the help of input from public forums.
What he learned:
At Woot, Matt’s most important lesson involved the value of a great deal. “The business was built on the deal,” said Matt during his Q&A at Startup Grind. “Everything went to the deal. You didn’t hire a single body in the company that wasn’t going to help you obtain a better, more efficient deal or record what happened when that deal sold or shipped.”
Armed with this mentality, Woot was able to drive people to the site and gain a massive following through word-of-mouth marketing. “If you define the market-clearing price on an item—” said Matt, “that’s the price at which it takes to clear out all those items—somehow the customers just arrive. It just worked.”
What he’s doing differently going forward:
At Woot, Matt felt like his opportunities to develop new ecommerce concepts were somewhat limited by the brand. With Mediocre, “the concept is we’re an incubator – we’re going to develop ideas that are our own and put them into action, but we’re going to do different brands,” said Matt.
Now free to set “low expectations” with Mediocre, Matt and his team have the opportunity to come up with ideas—both “crappy and good”—to present on public forums. With the help of the public’s input, Mediocre will develop novel ecommerce sites that build off the lesson of offering great deals that he learned at Woot.
Going forward, transparency will be part of Mediocre’s DNA. During our Q&A, Matt said he thinks that people are starting to be more ethical and open to sharing ideas. “I think one of the things you hear…is that the idea is not that valuable. It might be, but it’s not something to be protected, it’s not something to be hoarded. If we have a great idea and somebody else executes on it, then that makes us happy.”
Startup Grind is an event series and website designed to help educate, inspire and connect local entrepreneurs. Each month we welcome a speaker who shares their story with our community and tells us what worked, what didn’t, and what they’ll do differently next time. It’s an opportunity to learn from the best, network with other members of the startup community, and improve your chances of entrepreneurial success.
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