It was in the middle of a night in November 2002 when Sam Yagan’s phone started ringing and wouldn’t stop. When he finally picked up, his friend Chris Coyne was screaming into the receiver.
“He was yelling, ‘Dude! I have the best idea for a website! You would go to it and there would be a big ‘blind date’ button. You'd click on the button and the site would give you the name of the person you’d meet, the time and the location. What do you think?’” Yagan says.
Yagan wasn’t amused. While Coyne was known to come up with great ideas—the pair created SparkNotes in 1999 from their Harvard dorm room and sold it for $30 million to Barnes & Noble in 2001—on this night, Yagan was too tired to take Coyne seriously.
“I told him he was crazy and to call me back in the morning,” Yagan says.
The pair met the next day to discuss Coyne’s idea. Instead of a blind-dating site, they decided they would create an online dating service as an alternative to the already-established Match.com and eHarmony.com. The site would be free to users and, instead of using psychological research to match dates, former math majors Coyne and Yagan would mathematize users' answers to dating "deal-breaker" questions and match couples accordingly.
In 2004, they launched OkCupid. The site experienced wild success and, in 2011, was purchased for $90 million by IAC, the same company that owns Match.com. Today, Yagan is CEO of IAC’s Match division, which means he not only oversees OkCupid, but also Match.com and a host of other dating sites.
Katie Morell: Do people swarm you in public places to thank you for setting them up with their significant others?
Sam Yagan: Not constantly, but I did have a woman catch me off guard last summer while I was waiting for a flight at LaGuardia. I was sitting there, wearing an OkCupid t-shirt, and she came up to me and just started talking. She asked if I worked at the company and I told her I was the founder. She freaked out: "Ohmygosh, do you know that my son is engaged to a woman he met on OkCupid?" Then she got out her phone and called her son so he could thank me himself.
Photo: Sam Yagan
KM: You started OkCupid after selling SparkNotes, so I’m guessing funding wasn’t a challenge. Did you face other challenges?
SY: Of course. You are right, though, funding wasn’t one of them at first. The challenges came later, after we’d launched. Things were awesome from 2004 through 2006, but got pretty bad from 2007 to 2009. We tried initiatives that didn’t work, like going international. We spent nine months trying to expand beyond the U.S. and it was a disaster. Then the economy crashed at the end of 2008 and things were just bad all around.
KM: Did you worry that you’d have to close up shop?
SY: Yes. I had a spreadsheet that only my co-founders knew about. It had the date when we would run out of money—our "go broke date," or GBD. In early 2009, we were down to about two months of money. We would spend nights at the office and try to cut costs wherever we could, crash at friends' houses instead of hotels when we traveled. Things started getting better by summer 2009.
KM: Was there a magic bullet?
SY: It was a combination of a lot of things. Christen [Rudder, a co-founder] started writing a blog for the site that generated media attention. We also rolled out new product features and a big redesign of our site. At that point, we had really bottomed out. Everything has been great since then.
KM: Was IAC acquiring OkCupid a strange deal for you to accept, considering Match.com was your archnemesis?
SY: Our relationship with Match was really only antagonistic in the press. The truth was that we always respected what Match had built. It was a good fit for us and kind of felt like sending your kid off to college. The concept of selling was scary, just like saying goodbye to your child. But at the same time, you want your kid/company to go to a great college. IAC was that for us.
KM: So now you're CEO of IAC’s entire Match division—working for the man, as they say. You’ve been quoted saying that working for a major corporation is like going through a sex change operation because it is so different from being an entrepreneur. How do you like it?
SY: [Laughing] Did I really say that? Well, it makes sense because it's how I feel. And I’m having a great time at IAC. I’m learning a ton and I have a really talented team. It is also fun to operate at a scale of millions of users all over the world. We couldn’t have replicated that at OkCupid.
KM: Do you see yourself ever going back to entrepreneurship?
SY: I suspect that I will start another company at another time, but for now I’m happy.
KM: There's a lot of buzz around IAC’s Crazy Blind Date service. Is this the realization of Chris’ late night vision from 2002?
SY: Yep! After 10 years, we finally launched his product. It's a mobile-only product. You sign up and pay on a per-date basis. The response has been great so far; about 70 percent of dates are getting positive reviews.
KM: What do you see as the future of online dating?
SY: As we move into the third decade of online dating, online dating will move offline. Services will launch mobile products, so when you're on your dates, you will get real-time suggestions and apps will act as your wingman.
KM: Any final pieces of advice for budding entrepreneurs?
SY: I have three pieces of advice. First, don’t start a company alone. It looks glamorous, but it's the loneliest job in the world. Second, don’t be secretive about what you're working on. If your only advantage is that no one else thought of your idea before, that isn’t substantial enough of a reason to start a company.
And third, just do it. It doesn’t get easier as you get older. You might make more money and have a job that's harder to leave. Find a way to do what you love on nights and weekends. You can think about it all you want, but until you start, nothing will happen.
Read more interviews like this in our Building an Empire series.
Katie Morell is an independent journalist based in San Francisco. She regularly contributes to Hemispheres, USA Today, Consumers Digest, Destination Weddings & Honeymoons and Crain’s Chicago Business.
Photo courtesy OkCupid