TOP CEO: TextNow- 'The Code of Connection' (With Derek Ting)
Derek Ting 00:00
If we had the ambitions to build a very, very competitive WhatsApp competitor,
The Detective 00:07
imagine you're the CEO of TextNow, a company that reimagined communication by allowing users to send text messages over the internet, completely free of charge. You're leading the expedition into uncharted business territories. The destination. revolutionising connectivity with the path is strewn with challenges.
Derek Ting 00:34
We were very young and very inexperienced, literally just graduated college, and we haven't raised any venture capital yet. Each
The Detective 00:43
step, a test of strategy and resilience. Within your arsenal, you have a suite of innovative products, but a decision has to be made.
Derek Ting 00:54
At the end of the day, we didn't deliver a product we were proud of, we just weren't able to keep up. We just were able to keep up.
The Detective 01:04
Which do you let go? And which do you champion among them? Stands TextNow, a beacon of potential, the puzzle you face, carving out a sustainable revenue model for a service that defies traditional cost structures, a service that's universally free? How does one balance the technical with the strategic the present with the future? No easy solutions, no easy answers, just a relentless quest. To transform the way we
Derek Ting 01:37
connect, we had to figure out a plan to wind down the property. This
The Detective 01:41
is the story of Derek Ting. And this is The Code Of Connection.
Ben Kaplan 01:49
Derek take me back to the beginnings of an interesting model, which is providing phone and text message service for free being more ad supported, and take me through the generation of the company to start with, and how that annoyance of having to pay fees and by plans actually became a company. Yeah,
Derek Ting 02:11
it started with us with me being a college student. And being extremely annoyed with the concept of overpaying for phone service. That was something that that just really irked me. And what really triggered the birth of TextNow was when the iPhone first came out AT and T charged not only for internet and calling, but they want to charge $20 a month for text messaging. So at the time, he did pay 20 bucks a month for calling 20 bucks a month for internet 20 bucks a month for text messaging. And that was like, Hey, you can message over the internet. Why pay another 20 bucks a month for text messaging, that's a ripoff? Because it costs them nothing to send the text message. So why are you charging 20 bucks a month for it. So that was the birth of TextNow was building an app to text message using the internet so that I didn't have to pay another 20 bucks a month for AT and T and I thought a lot of people could then use it to not pay 18 T that extra 20 bucks a month. And what we've learned actually, when we brought text out of the world was a lot of people actually started using it for the iPod Touch. We thought a lot of people use it for the iPhone, but a lot of people use it flagged by touch. And we're like why? And it turned out a lot of people couldn't even afford the phone plan with the iPhone. And so they got the iPod Touch instead. And they were using our app to turn the iPod Touches and phones. And that's how we had our aha moment that like we should make phone service free. Not just text messaging,
Ben Kaplan 03:36
just to talk about your background a little bit. I mean, a lot of people are annoyed with phone plans. Not a lot of people start companies or services based on that annoyance. So you had a background. I mean, you were a computer engineer, you went to University of Waterloo, you worked as a software engineer at Qualcomm. And as this is growing, you're sort of turning inefficiencies you observe and trying to solve them. You're starting other projects, other apps at the same time. Correct. So take me through that. What what came tax now it was sort of in parallel with many other things, as you found kind of more itches you wanted to scratch?
Derek Ting 04:10
Yeah, at the time. Textile was kind of like a, it wasn't meant to be a company, right? It was meant to be like a passion project. And we had a lot of different passion projects. And in actually, I actually just wanted to learn mobile app development at the time as well. Right. That was a secondary goal. And, and so you know, built a lemonade stand game. And then we also built a another app that notify people when they got an email because back then, the iPhones didn't notify you when you had an email. So we had a relatively great success with these different portfolio of different products
Ben Kaplan 04:46
whose we at this point, I mean, was just a company was a bunch of computer engineers from college. What existed at that
Derek Ting 04:51
point? Yeah, it was literally my co founder, which was my classmate at the time and myself building it apps. And we actually hired an intern as well as interns. So, yeah, we made our own internship. And then we hired an intern as well to help us. Yeah. So
Ben Kaplan 05:10
you're having these projects, their passion projects, and they start growing at that point. And where did you start thinking about maybe you weren't at the point of accompany yet, but you were trying to think about like, Hey, this is more than a passion project, this is starting to turn to something was that when you started seeing people like, hey, they're buying back in the day I, you know, iPod touches, and trying to turn them into phones? Is that what clued you into something bigger? Or was it something else in the users the adoption that made you think we might have something there,
Derek Ting 05:37
I think they all had like a lot of traction, but I think textil had the most traction. And then we had another product that had a lot of traction, called Pink chat. Tipping Point was when we achieved the ramen profitability. And that means like, there was a business model in place where we could self sustain ourselves, and we don't have to get real jobs. That was kind of the moment. But
Ben Kaplan 05:59
those people who don't know a lot of people in the startup world know ramen profitability, that's basically like, you'd be profitable if like, all you did was eat ramen, and didn't really pay yourself. But you can like exist, you can, you're not gonna get rich, but you can sustain yourself, and you can sustain the Endeavor if you're kind of lean about
Derek Ting 06:13
it, basically. Yeah, we were at that point. And then that's the point where we realized like, this is what we're doing. We'll go all in. Okay. And you
Ben Kaplan 06:22
went all in? And was the strategy at that point? Was it like, have a portfolio of apps and we're just going to develop cool stuff and have a bunch of things in parallel wasn't like, let's throw spaghetti at the wall and see kind of what sticks and then double down there? What was the strategy in terms of just like, products, apps where you spent your time?
Derek Ting 06:37
Yeah, at the time, we didn't really have like, crazy ambitions, besides just doing stuff for fun. So then we, we had a lot of ideas, we like it just scratched it, we scratched a lot of itches. That was when we reached ramen possibility. And then, as time went on, it became clearer and clearer that we needed to, to focus our energy into fewer projects. And actually, it became even clearer, we had to focus on one, not even more than one. Basically,
Ben Kaplan 07:08
after all these passion projects, ideas, cool apps, you can build stuff, many of which had traction, eventually, as the story goes, you get down to kind of like two that are your main things, right? One, which is TextNow, which is this idea of let's make phone service and text message service for free by using a different source for that and kind of be ad supported. And the other ends up being like, kind of a for those of you who a lot of people familiar like a whatsapp competitor, kind of like a walled garden where you can message and communicate with other people in a kind of easy way. How are those at the time? Take us back? What year is this? And how are you kind of managing both at the same
Derek Ting 07:50
time? Yeah, that was like back in 2011. I want to say, Yeah, 2011. And it wasn't easy when they both have traction, because when they both have traction, though, they both come with their roadmap and their problems. And we've got a lean team, we probably had like a team was maybe like a dozen people. And
Ben Kaplan 08:12
how many of those were engineers? How many of that's like customer service people or other functions, or just that you just have
Derek Ting 08:17
to have Yeah, we had like two people on customer support. And then, and then they also doubled as a social media guru. And then rest of the team are either design product, or engineering, like, I would say, 90%. And like, at the time, I was spending my time writing software as well, like, maybe half my time.
Ben Kaplan 08:40
And then you're talking about what hundreds of 1000s of daily users at that point.
Derek Ting 08:44
Yeah, they both had hundreds of 1000s of daily active users. And
Ben Kaplan 08:48
it's you, it's your co founders, the two of you, it's a team of other people. How did you try to divide the work did like one take one and one take the other? Or? No, we were just kind of doing everything at the same time. At what point did this sort of start to feel like it was untenable?
Derek Ting 09:03
I would say we the way we did it was we had a couple of team members on TextNow. And then the rest of the team members on ping chat at the time, pics, actually, it was actually back then it was flipped. We thought ping chat was what we should focus on not text. Now. That's actually what what we did at the time. So textil was actually on maintenance mode. At the time, that was really early days. And then ping chat was this app that we actually acquired from another app developer. We paid a lot of money for it because we had the ambitions to build a very, very competitive WhatsApp competitor.
The Detective 09:41
In the heart of Silicon Valley, Derek Tang and TextNow embark on a journey brimming with challenges. A pivotal shift learned as resources and passions were rerouted from ping chat to TextNow. They face the daunting task of redefining in revenue in a realm with services, we're expected to be free. As TextNow as horizons expanded, so too, did Derek's role. Transitioning from a hands on developer to a leader. He navigated the complexities of company direction, team dynamics, and clear vision, articulation. But how were these challenges met? And what solutions were formed in the fires of innovation?
Ben Kaplan 10:32
So was WhatsApp. Where was it in its journey? It hadn't yet been bought by Facebook. Now, Metta it was just an app that was becoming popular. And you found another similar app that you thought you could build upon. And that was a big investment for you.
Derek Ting 10:47
Yeah, yeah. Actually, the app developer reached out to us and be like, Hey, can we join forces? Because he saw a tech success? We have a TextNow. And his name is Gary, use the author for ping ping chat. It's like, Hey, can you help help me scale this thing? We're like, Yeah, of course. And then so at the time was I was just like, $1, right? And we're both $1. And then we're like, hey, let's make it free.
Ben Kaplan 11:10
So after you had kind of invested in Hmm, where did it start to switch? Because at some point, you're saying, basically, you're doing two of these products, and you can't do them both? Well, and you're gonna have to pick one. Take us through what happened there and how you eventually chose textile? Yeah,
Derek Ting 11:25
eventually, we tried to do both. And there wasn't like, like, we thought there are going to be like a lot of synergies between TextNow in this other product. But actually, it turned out the way that they were built, there were there weren't many synergies, because architecturally they were very, very, both very differently. So we had to basically split our engineering teams into two, two different teams work on different products.
Ben Kaplan 11:49
And have you raised any money at this point? Or did you think about raising money thinking like, we need to, like really scale this? What was what was the status of that? Yeah.
Derek Ting 11:56
So at the time, we were very young and very inexperienced. And we literally just graduated college. And we haven't raised any venture capital yet. So we were basically bootstrapped. And I think that was a big part of the reason why we had to pick a focus because we couldn't adequately staff, an engineering team for both and do both Well, right. And so yeah, yeah, we and then at the end of the day, we, we didn't deliver a quality product we were proud of, because we will always had to make trade offs between the two. What
Ben Kaplan 12:39
was that? What do you say? Not a quality product? What was the issue? Like people were having functional issues? Like it wasn't working properly? Or you just couldn't follow the roadmap of what you wanted to add features? Or you couldn't keep up? Or like, what? What did it mean to sort of not deliver the quality you had envisioned? Yeah, it's
Derek Ting 12:55
offer, it's like, there's like the classic like 8020 rule, right. So like, 80% of the effort is the last 20%. So we were able to get the app to work and stuff like that. But being like, real time communication app, as things evolve, we had to make sure the app was fast, it didn't have bugs and glitches, whenever we make changes to it, we didn't break anything. And that that took effort that time. And that required focus. And when the early stages, there was a lot of grace on quality. But as the market matures and develops, there becomes less grace, I
Ben Kaplan 13:33
see. So when you're when you're kind of like the new hotness hasn't really been done before people kind of expect out this is like kind of bleeding edge cutting edge. If you want it to become your like everyday communication tool. And there's more options out there. Now you become less tolerant of a little bit of slowness, or something that I don't know, the app crashes or something else like that starts to annoy you.
Derek Ting 13:53
Exactly, exactly. And it just, we just weren't able to keep up, we just weren't able to keep up. And also, it required. Sometimes, to achieve the quality that we need, we may need to refactor re architect the app, rewrite the app that required a substantial investment. I see.
Ben Kaplan 14:10
So you get to a certain point. And it's kind of like having a mess of wires in the back, you know, and like in the back of your head into this mess of wires you're trying to meet at a certain point, you just need like I need to like rip this out and like redo the wiring, like redo the whole thing to make this work. Right. And that was a huge investment. And you couldn't do that with two at the same time. No,
Derek Ting 14:27
no, not not with the capital we had not with or lien team. And also, like, we just felt passionate about just focusing on one as well. You know, it's also part of it's just mind share, too. It's not just about money. It's about also mind share, and passion.
Ben Kaplan 14:44
So you have like three dimensions are actually probably right, you have money, just dividing it you have time, which is just actual, like just limits in the day, particularly if the team's lean, and then you have mindshare. Just what are you thinking about? What are you focused on? What are you passionate about? And usually they sort of go in that order at the very beginning, everything's like a money situation, right? And then you start to get you're okay doing with money, and then it becomes a time. And then even if when you have enough time, it's actually just focus, just mindshare. And at what point did TextNow then become the winner? And what happened at that point? Yeah,
Derek Ting 15:16
it became just like, like, what makes us unique, and what we're passionate about solving for the customer, at the end of the day, you know, still to this day WhatsApp full of have a role in helping people not pay international text messaging fees. But it didn't really like doing anything much more beyond that. And we thought there's way more potential and TextNow and actually make the whole phone service free. And that was way more exciting for us that the future was way more exciting than just making a messaging platform, which Facebook kind of already solved that problem. At the time.
Ben Kaplan 15:54
Take us through what was the years after that? Like, what was the scaling process? Like? What obstacles did you have to overcome? How did you sort of get kind of enough resources to do what you needed to do? Yeah, so
Derek Ting 16:04
at first, it was like a big, like, big context switch in the company. Because there was not just some cost from like a pure dollars standpoint, but there was emotional sunk costs, and they go up, people worked on pink chat. In fact, actually, the rewrite that we talked about, we actually, in fact, did rewrite it. So there was so much like, costs, invested
Ben Kaplan 16:29
just pure energy in investing it that it was hard to let Yeah,
Derek Ting 16:34
exactly. And we're looking at more than half the company worked on it. And that was like their full time thing. And so managing that change was the first step was walking through the thinking process.
Ben Kaplan 16:49
How big was the company at that point, when you were doing this kind of shift
Derek Ting 16:52
was probably around like 30 people, 2030 people,
Ben Kaplan 16:55
were you and your co founder in agreement on this? Or did it start to expose more differences in opinion?
Derek Ting 17:02
I don't think we were in disagreement at all. I think we were on the same page. I think the writing was on the wall. But I think one of us was more excited about the change. And one of them, one of us was less excited about the change. But we both agreed that was the writing was on the wall. We
Ben Kaplan 17:18
both agree that change was necessary. But you were more excited about what the future of like TextNow was that maybe your co founder? Cisely? Yeah. So you do that shift? And then what did you do to kind of like, manage the emotions and focus everything? And Did did you lose people over that? What sort of happened within within the company? Yeah,
Derek Ting 17:34
I mean, my last my co founder, that's, that's one that was very tough changes to manage. And but fortunately, we kept almost everyone. And it just, it was about communicating the new vision, it was about, it was about showing the success we have already and what we could do to build upon it. And so getting everyone's head wrapped around, that made the difference. So at the end, you know, the the end law people stuck around and in, stay out stayed on board, what
Ben Kaplan 18:07
year are we talking about? Now, when you kind of do the transition? You're through the transition? What year are you at now?
Derek Ting 18:12
2013?
Ben Kaplan 18:13
Okay, so totally 2013, still kind of early in the process. And so what happens after that, now, you've got to grow this business? What do you do? How do you think about fundraising? How do you think about other types of things you need, like marketing and other functions? What happens at that point?
Derek Ting 18:28
Yeah, I think the first thing was, like there was managing the people, and then eventually gotta manage the work that's changing. And that is, then we have to figure out a plan to wind down the property, which is like telling people, Hey, this is going to shut down because there's 100,000 People still using it. So that was painful. It's not just the employees working on it, but the people using it to say, hey, this products shutting down, this is the last day, it actually like also shifting people to like the new workstreams. That was the next thing we've done is like making a new roadmap, shifting people to the new work streams. And then my co founder was the head of engineering. So that was a whole I had to fill. So that was something I also have to manage is finding like an interim successor to the lead engineering.
Ben Kaplan 19:21
If you enjoy this show, you'll love TOP CMO with me, Ben Kaplan. never been a better chance on your opportunity to do that.
19:30
I would definitely encourage marketers to be engaged in the product development process, because you're banking
Customer 1 19:36
with the brands, great moments, but it's the great brands that create movements, and that's the spirit of justice.
Ben Kaplan 19:44
This is the podcast where we go around the globe to interview marketing leaders from the world's biggest brands, fastest growing companies and most disruptive startups available wherever you get your podcasts. So what was the growth For that, take us through the year since 2013 2014, you have 10 years in, what did you experience after that?
Derek Ting 20:06
Yeah, I think the first year, so it wasn't like a smooth sailing, we had to catch up on all a lot of tech debt in TextNow itself, because there was just tech debt accumulated when we were spread thin.
Ben Kaplan 20:23
And for those who aren't developers, we say that kind of technical debt, what you mean is that to get stuff going to make stuff work to make things happen, sometimes you have to like figure out a way to do something that isn't the ideal way. But that's like, you're almost taken out alone, right? Because eventually, you have to go back and fix it, that's not the ideal way to do something. And if enough of that accumulates, they can within you have like a big project just to go back. Correct. And almost do it properly unless kind of hacked together way.
Derek Ting 20:48
And then eventually, we started making investments to our product. And we we did our seed round, because also because of this context switch in the way, kind of our finances kind of came together, we needed a million dollars to get us through the transition. So that's around the same time as well. Right before Yeah, we raised a million dollars. So you raised
Ben Kaplan 21:11
a million dollars, and what is that going to go towards? That's going to go to actually getting rid of this, the team to get rid of this technical debt just to kind of keep
Derek Ting 21:18
things going. Actually, it was just like, just to keep operations going. I don't remember the exact details. But we made some moves that got us into a bad financial situation. So we need to raise a million dollars. I think that was just right, before we made that decision to focus, actually.
Ben Kaplan 21:35
Okay, so you did the seed round you focused? And then what are the next milestones of the company? After that? Take me through the milestones, other financial rounds, other user milestones, number of phone calls, conversations, take me through all of that.
Derek Ting 21:48
Yeah. Then we looked at figuring out how can we make phone calls free? And we also looked at how can we also grow as well. So then we started hiring a growth team, we started investing in the product, how do we make phone service free? How do we actually make the app work without Wi Fi, that was the biggest feature requests, because at the time, the use case was to download the app on the App touch, right, and then that part touch Wi Fi, and when it didn't have Wi Fi, then it didn't work. So to behave like a true cell phone service, it should work without Wi Fi. So these are the kinds of the problems we were trying to we were tackling. We didn't have when the app didn't exist on Android at the time. So we had to make an android version of the app. So there was like a lot of new investments as well. We're, we were making. And so we we started all those things at the same time. And that's when we started to see growth,
Ben Kaplan 22:41
and you start to see growth, because those were like the key sort of blockers are the key features that you sort of needed to realize the vision of free phone service. And what were the solutions? I mean, for an audience that isn't super technical, how hard was it for you to find the solution? How did you kind of get through all of that? Yeah,
Derek Ting 22:57
so the first biggest milestone was making calling free. And the calling itself wasn't hard, right? It's about getting enough volume. So then to get our cost down, at the same time finding a way to pay for it so that the users don't have to pay for it. And what I mean by that is we got to figure out some unique creative revenue model where an ad unit can pay for the phone call, rather than the user having to pay for the phone call. So the first version of free calling we had was people can watch videos to earn money, or minutes to make the phone calls. So that was the first big revolution towards having free phone calls. And eventually, we evolved to having our calling cost low enough that they can actually make phone calls for free without earning minutes. And then so that's also another point where we got closer to revision. And then eventually, we also did a deal with the carrier. So then we had, like phones, people could come by, that didn't have a monthly plan, or had a very cheap monthly plan that like let them use it without Wi Fi. So these are all the innovations we started coming up with to build on our growth.
Ben Kaplan 24:08
Where's your user growth of that time? Where do you first hit like, I don't know, a million users in a day? Where do you start hitting other metrics where this gets bigger and bigger? And also revenue continues to grow? Yeah, so
Derek Ting 24:19
I think from 2013 Till now, every year, we've been kind of doing double digit percentage, year over year user growth, as well as revenue per user growth. So we've basically gone from forget the exact numbers but like, like 30 person company doing like 13 million in revenue back in 2012. To like, now we're doing 130. So, like, in that that's not like, overnight, that's just us gradually building one year, on top of next year on top of the year after that, I
Ben Kaplan 24:55
see so over 10 years, roughly 10x The amount of revenue if he went from 13 million to 130 million, let's say, and kind of a, a steady pace, it sounds like and and how did he feel about that as CEO, you know, Bay Area, you see companies that can go like, you know, in a year or two, just like some kind of crazy growth. But yet you see a lot of companies flame out to at the same time they could start, even if sons that raise a ton of money are the hottest thing and then and then they're gone. So how did you feel about this steady growth that probably a lot of other businesses? That's great, right. But in Silicon Valley, you sometimes have different expectations of other things of that? How did you view it
Derek Ting 25:36
being in it at the time, it felt slow, it felt like we were underperforming, or with our periods, it felt like everyone was growing way faster than we did. And we should be raising venture capital as well to grow faster. That was definitely my psychology at the time. And the truth is because our business is so unique, and so special, that it didn't fit a mold for venture capital to invest in and we struggled to raise venture capital, did
Ben Kaplan 26:09
you raise any more money after that $1 million seed round,
Derek Ting 26:12
despite our attraction, we struggled to raise or a round, we weren't a company that venture capital was attracted to. So actually, ironically, that became a blessing because it allowed us to just focus on the first principles of our business and kept improving it every year, without the pressure and distraction of venture capital, and got us to where we are today.
Ben Kaplan 26:38
You know, that's the second time focus became important for you. I mean, the first time is like, you know, you have a lot of different apps. Now you have two competing apps, you focus on one, and this one you just focused on, you know, really a long term agenda of the product without a lot of other considerations and sort of time shifted away. How important do you think focus is overall and kind of looking back on your journey?
Derek Ting 26:59
That focus is the key theme of how we got to where we are focus on what are focused on customers focus on the problem we're solving, focus on building a great team, focus on management doing that right? Focus on leadership. So just, there's a lot of like unsexy things that come with running a business getting those things right translates to growth. And just learning that and focusing on that is been the blessing in disguise.
The Detective 27:33
Faced with a need for focus, explored the company's resources to TextNow, a move that honed their efforts and propelled the app forward. To sustain their free service model Tech's now adopted an ad supported revenue strategy striking a balance between profitability and user accessibility. Derek decided against the race for rapid expansion, choosing instead a path of Steady, sustainable growth. This strategy not only safeguarded Tech's now from the risks of over expansion, but also cemented its enduring presence in the market. embracing his new role, Derek galvanized the team with a clear vision and strategy. Ensuring cohesive and effective programs are one of the future of TextNow.
Ben Kaplan 28:29
How much of your time now is SEO? Is your time spent on the product? You are still working half of your time is spent coding early on? How much of your time is that versus how much time is like running a company? And how many like employees team members do you have now? So yeah,
Derek Ting 28:42
we're now a team of over 200. So I'm not necessarily involved with the product, that micro product decisions anymore, it's not my job to be. Now my job is making sure the business is healthy, making sure we're evaluating the team and having the right team in place at the right at the current cycle of the company's growth, making sure also, the vision, the vision is well articulated, and people understand the context that they're operating in so they can make good decisions. So I would say my job has been shifting from being hands on to now being the chief communicator in the company.
Ben Kaplan 29:25
And what kind of focus do you have now? It's a different type of focus. What kind of focus do you need? Where do you spend your time on if you're not the product visionary or product owner? There's other people for that. What is the critical thing that you focus your time on now? There
Derek Ting 29:38
is like external stuff I've spent my time on like talking to wonderful people like you
Ben Kaplan 29:44
do a great podcast. Sure, yeah.
Derek Ting 29:48
There's talking to candidates. Like I'm in a way I'm the chief sales person. So evangelizing the company evangelizing the product, and then also evangelizing internally or culture and helping the leadership, we have to do a great job. And that involves, again, like setting the context for them, inspiring the company with setting the vision and providing, again, a lot of direction, like not not that not Michael direction, but providing like the context. So then people know what, why they're doing something. It's
Ben Kaplan 30:23
the beginning of 2024, you know, out of a pandemic, there's been disruption in how people work and live and all of that, where do you see this all going? What is the next goal for you in TextNow,
Derek Ting 30:35
or view is like, our job is not anywhere near done, there's still so much to do, we made a lot of progress. We've, there's you come to text, now you can get free talk and text plan that you can use now outside of Wi Fi, and on Wi Fi. So we made a lot of great progress, but we're not done. And the next frontier for us is we want to make mobile internet free. So this year, we're gonna make a lot of progress in that space of providing not just free talking tax, but also free mobile internet, and creating very creative revenue models. So then the consumer doesn't have to pay for not just talking text, but talk text and mobile internet. And we
Ben Kaplan 31:17
say mobile internet, you mean data that you would use to run basically everything else that is going on your phone? How can you make that free,
Derek Ting 31:26
we're making it free, we have a lot of experience making, calling in free text messaging free. And we're at a point now where we're extremely profitable making talk and text free, and we can be profitable offering some form of free internet to our customers may not be unlimited, HD, YouTube streaming for free, but it'll be some form of a very, very compelling free internet plan. And then they can spend a buck five bucks 10 bucks to upgrade if they want to. But there'll be a very usable free internet plan that we're gonna be rolling out to
Ben Kaplan 32:01
do that. And to get to that next vision, do you consider fundraising? Again? Do you consider other things that's going to make this a much bigger company much bigger endeavor? Or do you think, no, if you can kind of keep up that steady growth you've had, and continue to, obviously control the company not have a lot of outside investment, that's great for you. Or if you rethink things in this new phase,
Derek Ting 32:23
the company is in a unique position where we don't have to take capital, and we can still be perfectly well positioned to execute on our plan, and continue growing in a very, very impressive pace. And also, at the same time, if a financial partner came along, could there be a lot of creative things we could do that we haven't thought about doing or wouldn't have otherwise thought about doing? Absolutely. So the simple answer is, if the right financial partner comes along, and there's a good mutual fit, we're definitely open to it. We welcome that conversation. But at the same time, we don't have to do it, if it doesn't feel right for the company, because the company is very, very well positioned from from balance sheet from a profitability standpoint to continue reinvesting its own earnings.
Ben Kaplan 33:15
Looking back, would you do anything differently? Is there anything you would have changed? Or do differently? What would that be? And what did you learn from this entire journey? Hindsight
Derek Ting 33:23
is always 2020. And I think the beauty of hindsight is you can you look back at literally everything, you do it differently with hindsight. So my, my goal isn't necessarily to like, try to look backwards and say, Oh, well, I could have done that differently. It's more about just learning what we could have done differently, and then apply it to how we look at the future. And so, and I think there's a lot of management lessons we've learned, focusing is one of them. And being very, very disciplined in the way we manage and be lean still, even though as we grow is another lesson. And so there's there's always a lot of management lessons we learn along the way that we can apply in the future, it's hard to pinpoint to one because the whole journey is just about learning. And
Ben Kaplan 34:16
what is your advice for final question for other entrepreneurs, other people facing a similar decision, maybe they've got competing products like you did, maybe they've got ideas, pulling them in different directions hack, maybe they've got the lucrative career at a big company, and then they've got their side hustle, which is turning into could be a main hustle could be a company in its own right. What is your advice from all of them? Just everything you've learned over the past 15 years?
Derek Ting 34:43
I would say the most generic advice would be it's like really hard. And so it's gotta be something that that we're passionate about, that we feel convicted about. And it's got to be something that we're able to give 100% of our effort to So I think that's the reason why I didn't sign up for a full time job. While starting tech. Now, it's just because it requires 100%. And that lesson got reinforced when we had two competing products, because it felt like we had two jobs. So we had to quit one focus on one. So that that would be the most generic advice I can give. And
Ben Kaplan 35:23
it sounds like you found your purpose within that. I mean, some people could view this and say that, you know, we're making cool apps that give people some some functionality that they like, at a great price free in many cases, but But you really found within that like this, it sounds like this mission to like, Hey, first you're going to democratize text messaging, and then you're going to democratize phone calls. And now you're going to democratize mobile internet. And it almost sounds like a bit of a cause and how you view it, even as you build a business, and you're able to find kind of a purpose, beyond just building a business and doing something entrepreneurial, and hopefully making some profit too, and, and all those things that you found a purpose even beyond that.
Derek Ting 36:03
Yeah, it's all about finding a problem that that resonates with us and then being obsessed with solving it. And I think that's an example here is solving for not paying not getting ripped off, or phone service is something that that resonates a lot with me. And so that's, that's, that's why we get up every day, because we're very passionate and very motivated to solve it for our customers. And I
Ben Kaplan 36:27
like your use of the word obsession, because I think that word, in a lot of contexts, it can be negative. But if it's something you love, if it's something you're passionate about, if it's something in the world that you feel like, isn't this way and audit exist a different way, then that obsession can be an incredibly positive force to do something. And I think your story is interesting, because I think so many times entrepreneurs or people that want business success, are sort of taught to like, look for market opportunity, like find something that sort of is a good opportunity, and sort of exploit it. Why because it's a good opportunity. And that's important. But it also is maybe I would argue equally important that it's something you're passionate about something that even if it's not as good at market opportunities, something else that you're not passionate about, if you follow your passion, maybe it's worthwhile, because it's going to be hard, it might be long, there's going to be ups and downs. And that's the fuel that sustains you. So look for market opportunity, but collide that with things you're passionate about, because you're going to need both.
Derek Ting 37:24
Yeah, and I would say market opportunity is like a problem that either you personally experience or someone else and yourself all experience. Not necessarily like Oh, because there's $1 there. It's more about is someone does someone have that problem. And one good example would be a lot of people think oh, crypto or AI that's like an opera. Like that's a market opportunity. Well, not really on its own. It's got to be an actual problem or pain point resolving for someone. I think that's what makes it the opportunity not because a bunch of venture capitalists put a price on it.
The Detective 38:02
Under Derek Ting's leadership takes now turn the tides of challenge into the winds of change. In this episode, choosing to pursue sustainable growth over rapid expansion shows that true success is measured not by the speed of ascent, but by the ability to endure and evolve.
The Detective 38:31
Derek's transformation from a hands on developer to a CEO is a testament to the idea that leadership is not about wielding power, but about empowering others. The enduring message is clear in the realm of technology and beyond trial is not solely about mastering the tools of the trade or dominating the market. It lies in the audacity to envision the future the courage to forge new paths and the resilience to turn every challenge into an opportunity for growth and innovation. And with that, it's Case Closed.
The Detective 39:18
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