Luma and Victor Pontis
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Luma and Victor Pontis
They built and launched a product in a week and eight months later raised $3m to accelerate growth
Victor Pontis and Dan Liu founded Luma in April of 2020 as a way to make it easier for people impacted by the pandemic to run their events online. And they had only met each other a month earlier on Twitter. It started with a tweet from Victor asking if anyone was building something to help with COVID:
Dan DM’d Victor and they decided to work together on a COVID tracker, which they launched four days later. They enjoyed collaborating so they continued to look for other problems to work on. A few days later a friend reached out for help with her Yoga classes. She was having trouble hosting them on Zoom, sending invites, setting up reminders, and taking payments. Dan and Victor realized there was an opportunity and started work on Luma. They launched the first version a week later, got some early traction, and earned their first revenue in May 2020.
In December they announced a $3m seed round led by Maven Ventures and Venrock to expand the product to also include helping event hosts build communities.
In our conversation, Victor talks about:
The risks of launching your product with only a demo and email waitlist
How they evolved the product from an event tool to one that helps people build a community around a shared passion
How organic referrals have been the primary driver of their growth
The difficulty of knowing if the reason people aren’t using your product is because it’s not good enough or if it’s simply that you are trying to solve a problem that doesn’t matter
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 Luma started? I believe you originally called it ZmURL?
Victor Pontis: The impetus was COVID. I had been working on a project called, Spring, in the micro mobility space. The thesis was that a Shopify for micro mobility would help smaller scooter and bike rental companies succeed. That business was already turning out to be tough and then COVID hit and I thought, ‘OK, things are really going to be on pause for a long time.’
I started to work with a friend of mine, Dan Liu, on various ideas to help people during COVID. We weren’t necessarily trying to start a company, it was more to just work on projects that would be useful to people. First, we made a COVID tracker where you could graph the COVID growth rate across different countries. Then we started work on what would become Luma.
We originally called it ZmURL which is a really rough name. The idea came out of wanting to help our friend host her yoga classes on Zoom. She had texted me asking how to manage all the stuff that comes along with a virtual class, like invitations, registrations, collecting money, etc. I looked into it and saw that there wasn't a good way to do it. Yes, there were some event tools, like Eventbrite, but they are very very heavy. They are designed for people throwing a big EDM concern or a Tough Mudder. If you just want to do a few yoga classes those platforms don’t really make sense.
We launched ZmURL in April, pretty quickly after my friend had reached out to me. We actually launched with just the idea before we had built anything. I tweeted the idea that we had and asked if people thought it was a good idea. People gave us positive feedback saying it would be useful. Josh Constine, who is now a VC, but at the time was a reporter for TechCrunch reached out because he was interested in the ecosystem that was being built around Zoom. Our concept very much played into that story. So based on the feedback we got we went ahead and built it. It was maybe 10 days from idea to the first release.
Wow, you moved really quickly. That’s great. How were you gauging the success of the initial launch?
VP: One thing that we didn’t do, which a lot of scrappy MVP launches do, is validate our idea based on how many signups we get on our waitlist. That is a very shallow metric to use. It’s easy to put your email on a product waitlist, it’s not a deep expression of interest. I've seen friends do this, they launch on Product Hunt with a waitlist, they get a ton of signups because they promised something really, really cool, but then it doesn't pan out.
We focused on building the core product. We didn’t even have a user login system in our first version. It was a tool that you could use over and over again without creating an account. It was very reassuring to us as we saw people coming back and using it over and over again to host their events on Zoom. We were solving a real need.
That’s good advice about making sure you don’t measure your product’s success against a shallow metric. Can you tell me about how you evolved the product and business from ZmURL into Luma?
VP: We had a few different phases. The first phase was the expansion of the event product. We began to make the event page more sophisticated. Hosts could log in, invite people, we remembered who they’d invited last time so they could easily invite them again, and enabling payments for events. We also provided some traffic analytics so hosts could understand where visitors were coming from. We added an event calendar so visitors could see all of the upcoming events for a host.
As we evolved the event product we saw that there was an opportunity to address all of the parts that come after hosting a single event. During this time we changed the name to Luma. And we worked on creating a suite of tools for event hosts. Things like profiles, newsletters, and other re-marketing tools. But we actually didn’t see great adoption of some of these tools. People mainly thought of Luma as an event product.
We weren't as excited, I think, about just building a suite of event tools. It was hard to connect them in a meaningful way. So we dug in on the people using Luma the most and we also spent time thinking about what would get us most excited. What do we want to work on for the next five or 10 years? What we found was that the people using Luma multiple times a week to bring people together, instead of monthly, were teaching an online course, or a religious organization, or a progressional group, or a paid community. They were teaching people and bringing people together who had never met in person. At the time this was a relatively new thing, to meet someone for the first time over video on the internet and then meet them in person afterwards.
That's where the idea for community came from. We saw an opportunity to tie together the event tool with communities. We provide the structure for this community product. You can send out an email to your members and let them know what's happening. There's a member directory so you can see who everyone else is. There's an event calendar and a library which has resources and content from the creator. Also, we recently released a basic chat feature for the communities.
You mentioned that you saw the marketing tools were not being used that much and you then looked at the most frequent users of your product to identify the community angle. What exactly was that process? Did you do user interviews with your high frequency users or something else?
VP: We use Intercom for support and we get tons of support messages every day. People are asking for help to set up their event or have questions. Based on the questions they were asking us we got good insight into how they were using the product and what types of things they were interested in. The other part is the story of the product that we're telling to people. Originally, we had the story that Luma is a tool to host your events plus be your all-in-one tool for everything you do related to events. But it was hard for us to tell that story and it didn’t really resonate with people. It wasn’t as powerful a story as the initial event hosting tool.
How did you realize that it wasn’t resonating with people?
VP: It was a mix of quantitative adoption numbers and the qualitative feedback. We weren’t hearing from people that this was changing their life. When we first launched Luma as ZmURL, people were writing to us about how they'd been trying for so long to run events and they had quit trying. Luma was something that really allowed people to do something totally different and new. We heard from people that had wanted to run fitness classes online, but didn't know how, but then they found Luma and now they have a business. There were a lot of awesome and really cool stories that motivated us.
But, when it came to the suite of event tools, people said it was really easy to use. They could now just use one tool instead of all these other things. And they liked the interface. But it wasn’t this step change in what they could do. It was just, ‘this is nice and I’m happy I’m using it.’ There was no emotional resonance.
That makes sense. I can imagine that in the early days you could really see the impact you were having. You were helping people continue to run their businesses despite having their life upended by COVID, but you didn’t feel that when it was a suite of event marketing tools.
Looking ahead, as people get vaccinated and begin to go back into the world, how do you see your product strategy evolving? Will you be continuing to lean into the community aspect?
VP: Yes, the interesting shift that we're seeing is that this previous generation of social networks which digitally codified relationships that began in person is shifting to digital first relationships. COVID has accelerated that shift for us. Before you’d meet somebody in college or at a party, exchange numbers and then add them on Facebook later. When you interact with them online you already have that amazing context of what you had already talked to them about when you met. Maybe you had talked about basketball and now you’re chatting online about basketball and then you organize a game at the park. Because the relationships started in person, Facebook doesn't have to do anything to incentivize us to be friendly or nice with each other. And actually in a lot of ways, people say that Facebook encourages the opposite of that. It encourages people to be unhappy and mean to each other.
I think in part due to the rise of video during COVID, people are meeting online first and then meeting in person. You can join an online community that also has an in-person manifestation. That's the real big shift that COVID accelerated for us. I think it was already happening in dating, where now people meet first on Tinder and then they chat back and forth, maybe a video call, and then they'll meet in person. We are seeing a similar thing on Luma. Professional learning, religious groups, and hobbie communities are starting online. It’s really, really easy to meet other people virtually and get an idea if they’re the type of people that you vibe with. Also, you can probably find people who are interested in something that is much more niche than if you're just looking at the surrounding 10 miles of your house.
What’s been your customer acquisition strategy? Have you found anything to be really effective?
VP: It's been totally organic and referral based. We don't do a great job with marketing because we are a really small team and have been focused on building the product. The small amount of marketing that we’ve done speaks to event hosts. Luckily, events are a social thing. Event hosts and community leaders are the connector nodes that bring people together on our product. They are often connected with other event hosts and community leaders. So we’ve seen them recommend the tool to others. Another interesting thing we've seen is that some guests begin to host their own events or will suggest the tool to another community that they are involved with. So it’s been totally organic and that's nice.
Have you invested in any in-product referral systems to increase that referral rate?
VP: We tried a referral system at one point, but it really didn't work. We had tried a system where if you referred someone and they made money, you’d also make money. I think it increased our referrals maybe a percent or something, but it wasn’t meaningful to overall traffic. If you have a good referral system it can be really amazing. But it’s something that you can’t just tack on and expect to work well. A referral system consumes a little bit of goodwill and it’s unclear to the person getting the referral if it’s actually something good or just something their friend is telling them about to get a discount.
I think at this point most people have referral blindness. They don’t value those $5 off on your next order codes and the people that actually love your product are going to refer it to their friends anyways, with or without that coupon code.
VP: Yeah, I think the ones that do work are if you have something that is delivering real and meaningful value to the person and they get a clear benefit from referring it to others. Like Dropbox and their extra storage space for referring it to others. It's so good because you want extra space and you don't want to pay for Dropbox. If the benefit is something more nebulous, like five dollars, even though five dollars is worth more than the extra space in Dropbox, it's not a concrete benefit tied to the product.
That’s a great point. My last question for you: A lot of entrepreneurs struggle in that first year as they try to find product market fit and the buzz from the launch has worn off. How do you manage to stay motivated and focused after the excitement of a launch?
VP: For us, it's that we’ve found the work we like to do. If my job was to make Tiktok videos everyday so each morning I woke up needing to make 10 Tiktok videos, that would be really hard to stay motivated. But I wake up and think, ‘hey, I'm going to work with other people who I like and I'm going to be working on a product today.’ That's something that comes very naturally to me. Also, when you’re building a product, you really want it to be better. It's always this both negative and positive motivation since you don't want to fail and you want it to be even better than before. You keep pushing on that.
I think the harder question is around when a launch doesn’t go well. Is it because you didn't spend enough time on it and it's not fleshed out enough, or is it because people don't want it? For example, if you had launched Uber and told people you can order a car to go from here to there, but in the first version it takes an hour for the Uber to get to you and it is always crashing and only three people hear about it. You’d see that there's no rides that week and might think, ‘this is a horrible product, no one wants it.’ but if you had actually made it way better, people would use it, and it would become this huge company. So it’s sometimes hard to know if it’s the product or the quality of the product.
Initially we were doing a lot of pathfinding, asking ourselves what do our users want, trying to anticipate that and build it. But now, we’re more focused on the community product and bringing people together to help them meet for the first time. We have a clearer direction which means we are doing more planning and roadmapping which helps a lot. We’re spending less time reevaluating all of our features.
So it’s about having conviction in the direction you’re headed?
VP: Yes, butI don’t think you necessarily need to have it from the start and it’s hard to manufacture. It’s hard to say, ‘I’m going to make a better...anything’ and then release it and get a ton of negative feedback from people saying they don’t want it. And you still think that if you make it better enough there will be this phase transition and people will like it.
I’ve been reading more about phase transitions lately, and I think it also applies to products. A phase transition is where if you take water and freeze it, it doesn’t become ice slowly. The water molecules don’t turn to half ice. It’s water until it becomes ice. I think that's true to a big extent in products as well. If you make it good enough, it can have a phase transition which means it’s hard to measure the incremental success of your improvements. This relates back to the launch waitlist. It's hard to know if people actually really care about your product from a waitlist. But once you have something that people can engage with, I think you're on the other side of that phase transition and can tell if you have a valuable product or not.
Thanks for speaking with me today. Where can people go to learn more about you and your business?
VP: Our website is lu.ma or they can follow me on Twitter.
I hope you enjoyed my interview with Victor 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