I’m excited to share this week’s interview with you. In 2019, Rachel Vrabec founded Kanary, a company that helps keep you safe by scanning the internet for sites that expose your personal information and then working to remove it. You might be surprised to learn that there are thousands of websites claiming to be legitimate businesses that offer your name, email address, phone number, home address, names within your household, and more to any stranger on the internet, as long as they pay a small one-time fee.
This hits close to home because in my family I’m the online privacy and security nerd, from showing family members how to disable cross app tracking on iOS, to encouraging them to set up two-factor authentication. I’m also always telling them how much personal information leaks out into the ether. Which is why I jumped at the opportunity to speak with Rachel. A bonus was that I was able to meet up with her in person. A first for my One Year Wiser interviews.
Online privacy has been slowly coming to the forefront of the public conversation. As people have become accustomed to giving their data and personal information away in exchange for “free” services, it seems like many people have resigned to losing their privacy on the internet.
Rachel and the team at Kanary are working hard to help people feel more empowered when it comes to their personal information and the internet. They launched their initial mvp in early 2020. In August of 2020 they released an updated version of their product that was much more robust. I talked to her one year after this release. In early 2021 they announced a pre-seed round led by 2048 Ventures and First Star Ventures.
With one year’s perspective after her August 2020 release, Rachel spoke with me about:
My questions are in bold; this interview has been lightly edited for clarity.
Let’s start at the beginning. Can you give me a quick overview of how Kanary started?
Rachel Vrabec: Today, a lot of people are interested in privacy and are learning about how different businesses, governments, and websites use their personal information. Once you peek behind the curtain, it's hard to walk away feeling OK. For me, it started when I was working at a company that used a lot of personal data to target people. I started thinking about how we’re exposed online, who’s in control, and what rights we should have to privacy. I began to think about the question: is it worth trying to gain back privacy on the internet?
It was my understanding of the technology used to collect information about people that gave me a glimmer of hope and the idea for Kanary. I knew we could build technology to find information and make it easier for people to figure out how to delete it. So I posted about it on Reddit in a privacy subreddit. The privacy subreddit has a lot of skeptics, but I got a good response, a couple of hundred upvotes, and a lot of good comments. That was an early indicator that we should go forward with the idea.
Flash forward to today and we're building a privacy product. Our focus is to identify where your information is going and help you get it out of the hands of people who shouldn't have ever had it, and in other cases correct it if it’s totally misrepresenting who you are.
I’m biased as a product manager at Reddit, but I love that you validated your idea with a Reddit community.
RV: Reddit has been a really good place for us to get good feedback and build a trusted brand. Our product isn’t visual, our software is mostly a backend for sending and receiving requests, so it hasn’t made sense for us to have a TikTok or Instagram presence. Also, a lot of social media companies have practices we don’t agree with and go against our mission of data privacy. But Reddit has been a great place for us, we can engage with other people talking about what we're doing and that’s been very helpful for when people hear about us and wonder ‘are they legit?’
Tell me a bit more about the first version of your product. Was it just an email based service?
RV: Yes, the first version was an email service. It found your data and told you where to remove it. It was clear the first version wasn’t a viable business because most people said it was interesting, but they wouldn’t pay for it. The hard technical problem is building something that can automatically do the removals for the customer and continue to monitor those places so their data doesn’t pop up again. The v2 of our product is pushing in that direction.
What you are describing sounds similar to DeleteMe, which is something that I use, although the user experience is very poor and it only scans once a quarter, I think.
RV: Yeah, I think we can do a much better job and help minimize the worry that people have when it comes to online privacy. One of our main investors was a customer of DeleteMe and decided to invest in us because they were so frustrated by DeleteMe. For example, if you have a stalker, scanning once a quarter for your personal information is not at all comforting.
We started Kanary focused on people who really need to solve this problem and we want to build the best solution for this group of people.
I'm confident we can automate most of what goes on behind the scenes and keep the costs really low and therefore it can be widely accessible but effective technology.
How do you measure if you are delivering value for your customers?
RV: That's a really good question. I was reading one of your recent interviews and there was a little dialogue about the issue of using shallow metrics, which I liked. I think it's super easy in your first year of your company to get caught up in shallow metrics or metrics that somebody else uses that aren't really a good indicator for your business.
Previously I worked at a different company in the data privacy space and it failed. Partially because we lost interest and motivation in our idea. But we were also measuring the wrong things. We had these high expectations and looked at sign up rates and all of those things that you might to track if you were launching on Product Hunt. But they were shallow metrics and we got really discouraged when things got tough and top-level signups were decreasing.
Today, our biggest measures of success are retention and engagement. For example, we send out biweekly emails to our members that share updates on our progress and ask them for help. We look at the response rates and customer feedback to optimize our feedback loops. We're not really worried about the top of the funnel or broad marketing. We're really focused on how do the small interactions that we build into our product encourage people to come back?
Interesting, I’ve heard that from a few founders now. It’s so important not to focus on superficial metrics. Was there anything about your early product that you wish you’d done differently?
RV: I think we launched way too early. Posting on Reddit and then quickly launching our first service, signed up the team and myself up for a lot. We've disappointed a lot of people. We could have done a closed beta, but we just made it available to everyone and asked for feedback. Some people responded and told us it was terrible. But you have to kind of get through some of that too, because people will come back if they have the problem and there aren't any good solutions in the market. You don't want to obsess too much over tightly controlling who has access to your product but I think I overcorrected.
You raised a seed round in April 2021. How were you positioning Kanary to investors and how has fundraising helped you?
RV: I’d call it a pre-seed round, we raised just under a million dollars, right now people raise seven million and call it a seed round. Regardless, it's given us a chance to hire a couple of smart people who care about our mission. We can now focus on a couple of things at once.
When we were fundraising we had launched and built something that was competitive in the market and interesting to enterprise companies. We had interest from a couple of big companies to buy data deletion for all of their employees as a benefit. One of the main pitches to investors was that we have an opportunity to take this market and go further. We're already getting inbound interest and we have growth via word of mouth. Fund us so that we can take the opportunity in front of us and make it even bigger.”
One thing that is super important when raising money and that I only realized after raising money is that you should focus on finding investors that believe in the market trend, even more so than your business in particular. I talked to a lot of investors who didn't care about privacy, and that was such a waste of time because the only investors who put money into Kanary are people who believe that there is a market for privacy that's going to grow exponentially in the next 10 years.
Let’s talk about product market fit. You mentioned in another interview in June that you don’t think you’ve quite found it. What’s your approach to figuring it out?
RV: That's such an interesting Y Combinator question. I think the Paul Graham response is “you don't have to ask yourself if you have found product market fit because, you’ll know when you do.” So what are we doing to get there? The way that I think about it is that there’s a scope of problems that people have that they're willing to trust somebody else to deal with and expect somebody else to solve for them. Whether they're willing to pay for the solution is a secondary question. When it comes to product market fit, the question is do you cover that scope of problems that person's having or not? Are you only covering a tiny sliver of them? Can you go above and beyond so that you do more than just solve the problem?
I think data removal and the technology we have today is sufficient for some people, but not for most. That's why I say that we haven’t gotten to product market fit yet because I don't think our solution is quite comprehensive enough for the size of a market that we're going after. People aren’t pounding on our door asking for Kanary, comparing us to DeleteMe and saying there's no question Kanary is 10x better.
There's going to be some sort of inflection point where we know we've solved enough of the problem. Our service right now is very reactive. But I know there's a lot of people who are also looking for proactive tools. For example, VPNs are super popular. Password managers are super popular. Those are all proactive tools. For our product to be successful there has to be a combination of proactive and reactive so that we can take advantage of the tipping point when it happens.
What advice do you have for people that are considering starting their own business?
RV: A few things come to mind. First, my advice to somebody who doesn’t have a co-founder is if you really care about the problem you can do it alone because the people you're helping, your customers, they will end up being your co-founders. That's what has kept me going, that connection with our members. If you aren’t super passionate about the problem and don’t have a co-founder, I would say put your idea on hold, it can wait a few months. Go find somebody to start the business with because if you're not totally in tune with solving a problem for someone you feel deeply empathetic for, it's going to be really hard and lonely.
Second is to handle reversible and irreversible decisions very differently. This is something I learned from a mentor, Holly Liu, and I think Jeff Bezos talks about this as well. Almost every decision you make is going to be reversible, so just try to break things down into pieces, understanding that you’ll never be 100% confident in a decision, and get it done fast. It's super easy to get caught up in a big idea or a big vision of something and then look at it and think, ‘that's not quite right’ and you don’t move forward. What I would have told myself a year ago was, try to get to those small pieces as soon as possible. On the other hand, irreversible decisions deserve a lot of time and deep thought.
Finally, getting feedback is really important. Something that I did early on was add a newsletter signup form on our website where anyone could sign up to follow updates on our company. Now I have this list of almost 1,500 people who have opted in to hear from me. I've gotten so much help from people on this email list, from hiring contractors to getting good feedback on the product. Related to this is that it’s hard to ask for feedback when things aren’t going well. I have to remind myself that it's OK to be vulnerable. I'm not the type of founder who's going to be tweeting about how we've messed up, so having this safe sort of public space to share some of the challenges we’ve faced has been super helpful.
Wow, that’s great. Thanks so much for taking the time to speak with me today. Where can people go to learn more about you and your business?
RV: Our website is a great place to start, also our subreddit is a good place to learn more.
I hope you enjoyed my interview with Rachel and learned a few things. If you did, give it some love on Twitter with a RT or Like. This helps more people discover my newsletter 😊 -Tyler