How We Sold Ticketbis to Stubhub
The sale of Ticketbis to StubHub (Ebay) was announced two days ago, at 10:00 AM. We had months of rumors and, finally, it’s been made official. I think I haven’t slept yet. I can’t help remembering when we were four people conducting interviews in a shared apartment kitchen five years ago. It’s been a time of big ups and even bigger downs. The famous startup roller-coaster.
But Ticketbis is, as of today, a story of business success in Spain, and one of the biggest. I’d like to share some things that have come to my mind in the last intense hours and I think were key to have made it this far.
1. Fuck bureaucracy
Maybe because I’m not someone who loves processes, I hate bureaucracy even more. For me, bureaucracy is mediocre people’s excuse. Processes, reports and meetings are much easier than sitting in front of a few results and say: now, how do I get two, three or ten times more? There are people who love organization. And I admire them. And I think it’s important. But organization and processes should never, never, never be above results.
Luckily, I believe that in Ticketbis — during most of the time — we’ve paid attention to the results, leaving aside the accessory or superficial things like pretty but useless reports or control processes that improve irrelevant channels. Ander Michelena— a CEO like no other who has made of his impatience the DNA of his company, always demanding one euro more on everything we’ve done, approving major projects over the course of a first meeting and discarding in thirty seconds whatever wasn’t a tangible growth — is to “blame” for most of that.
2. Copying is good
On the first day of Computer Engineering, the professor of Programming told us something that left everyone in shock, “don’t try to do everything for yourselves. If someone else has done it before, copy it”. That sounded like cheating to 18-year-old teenagers with pimples. Copy! Can you believe it? We couldn’t. But what she was talking about was efficiency. Putting efforts into evolution, not into repeating the past again. Copy to improve.
The same thing happens in a company. Ticketbis didn’t invent anything: StubHub or Viagogo came before us. And we’ve learned a lot from them. For example, through similarweb.com we discovered the traffic acquisition channels of Viagogo in Germany — a market where we’re not strong. We could have been in 37 meetings trying to figure out what’s the key, but we chose to analyze data, notice that 50% of their traffic comes from search and reaches only ten specific categories, and go all out for it. Sometimes, it doesn’t even have to be the competition, it can be Google, Facebook or even Mercadolibre — a local example. They have already paid a lot of money to have the best people at thinking; I don’t believe the way is trying to demonstrate we’re smarter than anyone else.
In short, I don’t know how many times we’ve said here: “it’s all been done before, we have enough with doing it in 48 countries!”.
3. AAW = Always Ask Why
You shouldn’t be afraid to ask for answers, even if you feel uneasy about seeming boring or annoying. The human being tends to avoid confrontation (if not, it would be impossible to work) and when someone gives you two or three excuses it’s easier to look away to avoid tension.
But the fact is the lack of “whys” is a deadly poison we must purge, starting with ourselves. Over these years, the CEO asked me many times why I did or didn’t do something, and I beat around the bush… knowing I wouldn’t be able to escape the next time. Most of the Ticketbis’ success has to do with this continuous scrutiny.
Typical example — highlighting an action because it has had many retweets. “We’re super cool, we got 200 retweets!” Hey, I want results that are worth money like leads or sales. A retweet, until proven otherwise, is worth zero. And by the way, a Facebook fan too. It’s incredibly easy to get thousands of fans having money, but if you research how much you get from those fans, maybe the numbers would be seen in a different way.
And this leads us to the following.
4. The 80–20 rule is sacred
It’s statistically likely that 20% of your customers, products or pages get you 80% of your company value. And it’s very likely you’re not devoting most of the time to that 20%. In our case, as a result of transforming a handmade company into a data-driven company in 2012, we noticed less than 100 events were responsible — back then — for 93% of our turnover. If instead of doing everything right we were able to double the sales of these 100 events a year, we’d almost double our turnover! Indeed, putting all our efforts into them we reached a steady speed. And until today.
The 80–20 rule — also the Pareto principle — should be applied to everything. In Product Managment, for example, things get out of hand very easily. As of today, there are still many not automated things that some departments have to routinely do. Seriously, some of those things would make you feel embarrassed. But the fact is that until the big 20% of what is essential is done, it makes no sense to invest resources in doing anything else.
During the time that I’ve been in charge of the Product department at Ticketbis, I’ve been hated by a significant number of people; but if something didn’t pay off, it wasn’t done. It’s that extreme and that effective. We’ve practically doubled the conversion each year.
Again, my favorite one is “let’s get a lot of fans on Facebook” (apparently I have something against Facebook fans!) a paradigm of the 80–20 rule. Perhaps having a lot of fans is useful for Zara or Coca-Cola. The others don’t care. Because there are many companies doing that as if their life depended on it.
Measure everything, basic to follow the 80–20
Five years ago, we registered our sales by hand, on a screen with 50 transactions per page manually distinguishing between the accepted and the not accepted ones. Today, we have more than 1,500 tables that analyze each one of the countries, events and clients. And, honestly, I believe that we are just getting started with the benefits we can get from data analysis.
The only way to do things that work, follow the 80–20 rule or find the real answers to the “whys” is by measuring.
If there’s no data, you assume. And the easiest is to make mistakes. You should never assume anything, because data show us every day how limited our sixth sense for business is.
5. Tens and zeros
Throughout these years I’ve identified two types of workers who determine the future of the project. Identifying and either holding or getting rid of them on time is essential.
Tens are terribly scarce. They are exceptional, the people responsible for company growth. Smart, fast, and self-confident people who take on the decisions that show the way the company will follow, without fear to mess things up because they are committed in the long run to themselves.
Talent is always cheap even if you pay a lot for it
Tens represent, perhaps, 1% of society so a good way to understand their uniqueness is by thinking that, at most, there will be 1 out of 100 employees. The biggest mistake you can make is to be unaware of this, believing everyone is replaceable. No, not everyone. These strategic employees must be retained almost at all costs and must have sufficient autonomy to make a deep impact on the company.
And to incorporate these people you have to be willing to pay what they are worth. You can’t expect someone will take the reins of a company area to make it grow and pay them $50k. There are no such bargains or if they exist because the planets aligned, it won’t last for very long. And looking for them is a huge management mistake. Someone who took a great responsibility, but is not trained for that, makes more damage than not hiring anyone. Saving on talent is the perfect recipe to ensure failure. In Europe, we still have a long way to go in this regard. It’s essential for managers to change this culture; it’s necessary to stick in our minds that what matters is not how much you pay, but what you get in return.
On the other side of the tens, there are zeros. The tens multiply, the zeros sink you. I think we haven’t had too many in Ticketbis, but the ones we’ve had have been a total brake. They don’t have to be more or less intelligent— an employee’s ability doesn’t depend only on that. Rather, they’re the “this can’t be done” people, the ones who don’t want to grow because staying always the same is easier, those who always say it’s somebody else’s problem, it’s never their or their team’s problem. For zeros, the greater the responsibility, the greater the mess. And there is no better solution than getting rid of them as quickly as possible. Otherwise, there will be a negative situation for everyone.