Strava cofounder: Mark Gainey Live in San Francisco

• Mark Gainey discusses how Strava started with a $3 million raise, spending $2 million on a lawsuit, highlighting the unpredictable nature of business.
• Strava's initial target was the niche market of middle-aged men in Lycra, which helped them build a loyal user base before expanding.
• Gainey emphasizes the importance of understanding your market, sharing how Strava's user base is 82% international.
• Strava's evolution from a website requiring Garmin uploads to a mobile app showcases the rapid technological changes in the industry.
• Despite early challenges, Strava's mission of building a community to keep people active has remained consistent since its inception.

In this podcast with Kyriakos, the CEO of Terra, Mark Gainey delves into Strava's journey from a niche cycling app to a $2.2 billion fitness platform with 150 million users. He shares insights on the unpredictable nature of business, recounting how they spent $2 million of their initial $3 million raise on a lawsuit. Gainey also discusses the importance of focusing on a niche market and how Strava's user base is predominantly international. Listen to learn how Strava's mission has stayed true to its roots while adapting to technological advancements.

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42,000 Tickets and Zero Ad Spend

We literally had just raised our first $3 million and we had to spend almost $2 million of that to defend ourselves against a wrongful death lawsuit. So that's the other thing I'll tell you: whatever you think your business is gonna be and where it goes, they're wildly different. So get ready for the ride.

This is Mark Gainey, co-founder of Strava, a $2.2 billion fitness platform that turned running and cycling into a global social network with over 150 million users.

Look, AI right now can do so many things and it's so capable. So it might be a problem focusing on a niche. Is this a wrong way of thinking about it? Vision is important. So where you believe you can get to, but separate that out from go-to-market and how you go to market. And if you don't understand who you're building for, there's tremendous risk. Probably in our space, Strava is the best in the world in removing things and simplifying things. And how do you optimize for having the only feature that is useful for that? Part of how we did it was we initially started with everything but the kitchen sink and then we were ruthless at watching not just what our customers were saying, but the way in which they were interacting with it. And we started that cutting process.

What's the best way of raising money, raising funding for their business? Speed over greed. You don't have to own the whole thing to somehow do really well. The first offer we had was $300,000 for 40% of the business. And we managed to get $700,000 for 40% of the business. Four years later and only two rounds of financing later, we had a company worth $10 billion. So despite selling 40% of the business, my little slice that was still left was pretty damn good.

When it comes to storytelling, Mark, you are, if not the best in the world, one of the best in the world in this. So how would you advise people how to learn, how to speak to customers, how to speak to investors?

Okay. We're beyond excited to have Mark here to share insights from his journey building the biggest fitness and exercise app in the world. We also invited Kyriakos. He's a founder of Terra API, helping developers and companies leverage health data through wearables and sensors. So everyone, please give it up for Mark and Kyriakos.

Hello guys.

A lot of people in here. It's a lot of people. How many people, how many of you are using Strava? Oh. Everyone. Thank you very much. Just made my day. So how many of you are cyclists? How many are runners? What about weightlifting? Oh, what else? Is like surfing anyone? Oh, windsurfing maybe? There we go. It was less and less. There we go. Oh yeah. Okay. How many pay for the app? Oh. Yeah, yeah, yeah. Okay. That's okay. We can talk about that one. Super.

Just to give you an introduction guys, Mark studied at Harvard and then he was also a Dragon Cross runner, joined the crew rowing team. After he left from Harvard, he joined TA Associates, then started a company called Kana, which became a public company at $11 billion valuation. And then he left and started Strava, which has 125 million users around the world, if not more these days.

Oh, 150.

150. And then he's the leading digital community of athletes globally. So thanks a lot for coming, Mark.

Of course. It's my pleasure.

The Photo That Built a Flywheel

For the first question, I wanted to ask you, because everybody in this room is today here for the AI event. You started in the previous era when the internet started. And then, so can you give us like your view about how the company building changed when you started with Kana, then with Strava, and then to today?

Sure. Yeah, there's a lot in there. Well, first off, I'll start by saying, thanks for having me. Thanks for coming to listen. This is gonna be really fun. I would start by, I am so jealous of all of you right now, just because this AI moment feels very much like, frankly, when I was your age, I'm a dinosaur, I'll admit it right now, 57 years old. But when I started my first company, it was 25, early 90s. And the internet literally was just starting. Like there were no companies on it. It was coming out of DARPA. It was a defense thing. And here we were starting to learn how to build companies. So I haven't felt personally like I did back then since now. So just awesome time. Yes, there's a lot of scary stuff going on as well, but wow, what a great time to be thinking about being a builder.

To answer your questions, I'll give you just one example of a difference. When we were delivering software in 1997, 1998, if we delivered a new version twice a year, that was a big deal. Like the idea of even being SAS really didn't exist. You literally delivered your software on a disk to a customer in their facility, on their servers. And then we had engineers who would stay on site to hit the reset button on the server because we had so many bugs that it would go off. So the idea of development, the idea of sort of bringing software to market was arcane compared to today. I mean, Strava probably does multiple releases a day at times. And I think with AI, what we're seeing is not just the speed, but we're seeing the weight at which the team size and everything else is just sort of rapidly changing. So for me, that's the number one thing I would say is just the time to market and our ability to iterate was so different back then.

And then what about technology? How did cloud change things and how did new technologies change how you started companies and build companies?

So I just mentioned speed to market and our ability to iterate this idea. I mean, personally, I love software versus hardware. Software, you can test something. If it doesn't work, you can roll it back. That was not the case in 1995, 96, 97. I mean, again, you were putting it on a disc. So I'd argue that ability to be iterative, to be creative has only gotten better. The speed at which you can bring things has only increased. Those are the differences. The things that are the same, I mean, and this is where I have mixed feelings around sort of what AI can do. You and I were talking a bit offline. If I were building for businesses, I really like what AI can do because so much of the business functions that are out there, they're very binary. They're very sort of function oriented. And so I like how AI can get in and improve the speed and improve accuracy and so forth. My world at Strava and the consumer base, there's a big piece of that is the connection to the consumer. And I don't think that's gonna change. I think that our ability to sort of relate to who we're trying to build for, how the company can support our customers, which goes beyond just the product. One thing I always caution entrepreneurs is don't forget that what you're trying to do is actually build a business, not just a product. And I think those things haven't changed. You know, our ability to sort of, the ability to think about our employees and what they need to be successful, the ability to think about our shareholders and our investors, you know, that hasn't changed. So I think the fundamentals around sort of what encapsulates a great product, which is the business itself, I've felt a consistency there across at this point, the decades that I've been doing this, but it's the speed is amazingly different.

And can we get into your shoes in the very early days of Strava? How did things started? How did you come up with the idea?

So the idea was born out of a very simple mission, which was Michael and I, my co-founder, we've always had this belief that when we're active, we're frankly just better people. And we had known that because we went all the way back to when we were in school, when we were college students, and we were on the crew team together. In the thick of racing season was when my grades were at their best. I was most efficient. There were just a bunch of things that proved to me, it's like, okay, this really works. And frankly, it was an amazing experience to be part of a team, to be competing, the trash talking, the camaraderie, everything that sort of came with being on that. The problem was we graduated and poof, that whole thing disappeared. So ironically, we had a business plan in 1995 that was the original Strava. We were just a little early with the idea. We pivoted into the email company that you described earlier. But the thesis remained the same. And so when we launched it in 2009, it was this idea of if we brought people together, would they help us remain active? Because if we're active, we do well. So that was the mission and remains that way today. You know, why do we, as I was joking earlier, why aren't you paying? Frankly, we love our free members because our free members are contributing to the community. They're supporting one another. They're keeping people active. They're contributing data. They're contributing their posts, which we can then create great features from. So in our case, our free members are not just a marketing opportunity. They truly are sort of the heart and soul of the community.

Now, how do we get started? That's a different question, right? That's when we really, this is one bias that you're gonna learn from me as an entrepreneur. I love the niche. I love going after a very targeted audience. Then so, and I've been accused of creating companies that really aren't companies, they're barely products. In the case of Kana, which is our first one, we were building to respond to customer email. If a company got a customer email that came in with a question, was our system capable of helping that company answer it? We were told by investors, you're not a product, you're barely a feature. But what they were missing was that in the birth of the internet, there was not a single company that could figure out how to answer their customer email. And so it was a very specific problem, particularly for anybody going online for the first time. And so that little wedge into our customer base allowed us to then rapidly grow, as you said, to a public company worth over $10 billion.

In the case of Strava, for those of you who don't know, we started with a very focused audience. It was something called a MAMIL, M-A-M-I-L. You may know them, that hybrid. It's a middle-aged man in Lycra. That was our target audience, that road cyclist who absolutely is addicted to going out on their bike three, four, five days a week. And that's who we targeted. Not because we thought that was gonna be where we grew the whole business, but by having a go-to-market strategy that was focused on a very key audience, we could build a loyalty and build sort of an enthusiasm and an engagement for the product that would then give us the confidence to expand. So vision was to support a global community of athletes, which we're doing today, but our go-to-market was hyper-focused. Again, to the point where investors accused us of being a hobby, not a real business.

I think we discussed this in the past, but is there at any point that being niche is the wrong advice, would you say? Because we had this debate the other day, internal intel, actually, and it was all about, look, AI right now can do so many things and it's so capable, so it might be a problem focusing onto a niche. So is this a wrong way of thinking about it?

I'm gonna defend the niche to the end, but it doesn't mean you always get the niche right. So I can separate those two. The one that I love to use, just because, again, it was near and dear to me, I am old enough and went to the school where Facebook was literally a Facebook. When I showed up my freshman year, I got a book and it had my picture in it, where I was from and what dorm I lived in. And we all quickly opened it up to figure out who are our friends and who's gonna be, and that's what it was. And when Mark then launched that in the early 2000s, it was focused on a niche, which was the college student, to create an online version of that Facebook. Now, I remember also thinking when he then opened it up to the rest of the world, that's a stupid idea. Why isn't he staying focused on his niche? So I will agree that there's a point in time where you have to think about expansion. And in fact, we went through the good and the bad of doing that at Strava. After three or four years on the cyclist, we launched into running and then we began out, and I think there's 50 different sports you can do on Strava a day that has been both, it's been good for the business, but it's also been challenging. But no, I think, again, vision is important. So where you believe you can get to, but separate that out from go to market and how you go to market. And if you don't understand who you're building for, there's tremendous risk.

And was the vision for Strava the same from the beginning, or did it expand after you saw the first success with customers?

No, actually, the first business plan is pretty consistent even today, 16, almost 17 years later, in the sense that it was a very basic premise. So we really did believe in this idea that, again, I mentioned earlier, if I'm active, I'm a better person, but it's really hard to stay active. Well, how do you stay active? When you have teammates, when you have other people. So the thesis was, if we could build community around working out, good things would happen, both for our members as well as for the company itself. That has remained true. I think what has changed or evolved or things that we just hadn't anticipated, 82% of our members are outside the US. And that's been that way from almost day one. So any of you who are thinking about launching online, you will be an international company before you're prepared to do it. This goes right back to sort of, I think AI can be helpful on that front, but you have to be careful because I can tell you, the lessons we've learned are very nuanced around culture and the way in which sport relates to people's daily lives. It's very different in a place like Brazil versus the UK versus Germany versus Tokyo. So until we really started to understand those nuances, we made a lot of mistakes.

Can we get into the product in the early days and how did it evolve over time?

Wow, again, I'm gonna date myself. When we started Strava, we were a website and the only way that you could upload was by buying a Garmin device, plugging it into the back of your computer and literally uploading that right, a fit file onto your computer, pretty arcane. And we did that-

It works with my Garmin today actually.

Oh, yeah, it was, so that was 2009. In 2011, we launched our first app. I won't walk you through all the mistakes we made, but fundamentally we were hoping that by launching an app, we would have a lower cost means of people to be able to upload. What we didn't anticipate was if you downloaded the Strava app, that would be the only place you'd ever spend any time on Strava was in the app. We assumed that you would just use it to track your run or your ride. And then you'd go to our beautiful website and see all the wonderful features that we had. So we had to then become very mobile first in the 2010, 11, 12. So that was the next chapter for Strava. When we launched into a new sport, we launched two separate apps. So we were so worried about our cycling community that we actually launched Strava Run as a separate app in the app store. And we tried to run two apps simultaneously. In hindsight, probably really stupid, but again, we were so protective of our customer that we didn't want our cyclists to in any way feel that we were dismantling their experience. And over time, we've been able to bring those together. I could keep going, but the big changes for us moving from web to mobile, moving into multi-sport, moving into international, understanding that, the economics of the business, the fact that it's a subscription business, adding our partners in. Today, there's a sizable business in Strava where the brands and other technology companies can participate, not just through the API, but through economics and so forth. And so that's been a big learning curve for us. And now AI. So just so you know, caveat, I've retired from Strava as of January, 16 years, and I'm out. So I'm not totally clear on all the things that they're doing right now, but I know that the AI chapter has got the whole team super excited.

Speaking of Garmin in the early days, I'm sure you faced the kind of maybe the dinosaur that Garmin was at the time. It's a very big company. I suspect that you had problems with them early on because you're a startup, you're trying to work with a really big company. Did you actually get to understand them once Strava became really big and why they were behaving in that way?

So again, I've retired. So they may understand them well today at Strava. In the 16 years I was there, the answer is no. But I don't mean that in a derogatory way. It's just two businesses that have sort of leaned heavily on each other, but I don't think have ever had the tightest strategic relationship out there. When we started, we were so excited because it was really clear we could sell a lot of Garmin devices for them. The only way you could use Strava was with a Garmin device, no other device out there. And so we wanted to be a reseller. We just simply wanted to, we'll buy them at wholesale and we'll resell. They told us, no, we're not comfortable with that. We're worried you're gonna ruin our retail channel, a handful of problems. So we had to go to Costco and actually two problems. First thing we did, we went to eBay to buy a bunch of Garmin's from some sellers and we got totally fleeced. I think we lost like $10,000 in Garmin's because people told us they were gonna sell them to us and they never showed up. So then we went to Costco, a much more trustworthy place. And we were buying literally Garmin's at like a 40% discount and then reselling those to our friends. That's the way we started our Garmin relationship. What happened over time wasn't through any kind of long conversation. It was the simple fact that they realized when it said on the box, compatible with Strava, the boxes sold much better than when it didn't. And they realized, oh, there's an interesting sort of relationship here where we can sell a whole lot more hardware. And we also were very clear to them from day one, we will not be in the hardware business. We're not trying to compete with you. So ultimately we ended up in a really good place, but that's years in the making. Patience to all of you out there. As much as we wanna go full speed and you're gonna hear the speed is your king and you're gonna hear me talk a lot about how speed is something that is only getting faster right now. I will also preach the three Ps, patience, persistence, and perspective, but patience to get the stuff right.

How did understanding customers change over time from the early days to today? Like I suspect that if one builds today's Strava, for example, they would spend a lot of time in cycling shops and speaking to users directly. Whereas in the much bigger scale, you have much bigger experiments with so many users. How do these things change on the different stages?

Yeah, well, this is why I envy the entrepreneur who's really just starting their business because I do like that simplicity of, I'm gonna go find that one target audience and go just do something great for them. Michael and I always had this thesis that we'd rather be great than big. And it was sort of a little bit duplicitous because if we're great, we can get big, right? It was sort of that mindset. But what happens is you're right. As we grew, all of a sudden, it's like playing three-dimensional chess because number one, the international component, which I've mentioned a couple of times, you have to be very cognizant that the way in which someone relates to their, in our case, to their sport or their activity is just different country to country. And so how do you pick up on that nuance and what features do you need to build? The second piece of it is sport to sport. For example, cyclists are just, they're just historically very social. They tend to go out and they'll ride together and so forth, but they're not typically training for something. Of course, there are those who train for races and the two are riders and so forth. But a lot of cyclists really just, they enjoy being on their bike and they enjoy doing it in social settings. It's like the new golf is what you hear. Runners, runners are training for something. Whether it's their 5K or a marathon, they tend to be, they're creatures of habit. I'm a runner, so please, I'm not being, again, I'm gonna turn. It's like I got that same three or four routes I do for my own. So just the experience in Strava alone had a radically change. One of the biggest mistakes we made was that we thought that we could take our Strava cycling experience, re-skin it with some great UI and sell it to our runners. Totally failed. It wasn't until we brought running DNA into the company, hired great runners who are also great engineers and marketing people and product people that we really started to build something that felt authentic for the run community. So sport threw us off, international threw us off. And then the last thing I'll say is, just again, this is unique to our customer, but I think any of you should be thinking about this. Even within a particular sort of country or sport, you have different motivations. There are those who, early on at Strava, we were always told, I'm not good enough to be on Strava. I'm not competitive enough to be on Strava. And we'd look at the data and keep explaining to people, just look at my profile. I am not fast. I am not, you know, but people really felt like there was this high hurdle to participate. And it took us years to start to understand personas where somebody who isn't necessarily competitive, but believes deeply in the importance of working out every day. And so what are the features we have to build for them? So good news is, can you almost guarantee for any of your businesses, there's a long roadmap that will last years? Don't look at that as a bad thing. Look at that as just a great thing that means that you've got plenty of runway in your business, which is what we've seen at Strava. We've got 10 more years of stuff we're still trying to build.

We also spoke in the past about this concept of via negativa, about removing things instead of adding. And there is this myth when starting a company that you need to keep adding features in front of the product and make it more useful to people and keep piling up all of these. I think probably in our space, Strava is the best in the world in removing things and simplifying things and making the experience of the users better. So can we speak a little bit about how do you optimize for having the only feature that is useful for that?

Well, first off, I would say you're being exceptionally kind right now because I would have a very different take on sort of where we've gotten to and frankly still sort of the elimination process that I think the team is trying to go through to really understand the usability of the app. Full disclosure, it was about two weeks ago I discovered a feature in the app that I didn't even know existed. It was both good news and bad news. It was something I really liked had to do with routes, but the fact that it was buried in there just spoke volumes around the fact that this is actually really important and super hard to find. It's a very powerful statement that as somebody who's now built a couple of software companies and advises a lot of folks, it is probably the idea of actually editing and reducing that user interface is one of the hardest things that any of us has to do as an entrepreneur. How have we done it? The irony is if you go back and look at our very first website we ever built, there are still features on that 15 years later that we haven't yet implemented on now the Strava that is everybody knows commercially. So part of how we did it was we initially started with everything but the kitchen sink. And then we were ruthless at watching not just what our customers were saying, but the way in which they were interacting with it. And we started that cutting process. That worked really well early. Then we had another forcing function, which was when we went to mobile. So you guys are all already there. But when you went from a footprint that was a website down to a mobile, it forced us into another sort of cutting exercise or reduction exercise. So I think we built sort of that muscle during that period. And that's where we developed that reputation. But I can tell you that the sausage factory behind the scenes and how many features are still buried in there that you can't get to, it's embarrassingly high. Yeah. And I mean that in the best way, like it's the team tries hard, but it's tough.

Speed Over Greed: Fundraising Secrets

And then it's, I'm sure everyone in this room would be very interested into fundraising. And it would be very interesting to see your, the early days, how did you approach investors? And then how did it change after different rounds? And then what would you advise people here? What's the best way of raising money, raising funding for their business?

Just for context. So I have been fortunate, the two companies that I've built, in Econa days, we raised, let's see, we did three rounds prior to taking the company public. So that one was quick. That was in four years time, we went from two guys and a dog to 1200 employees and a public company. That was the key rounds were led by folks like Benchmark and others. So we know the venture community well. At Strava, our large shareholders are groups like Sequoia, Capital and TCV. So we know them. I've gotten to know them well. Strava has been through. 16 years, I think we've been through six rounds of financing. I've lost track. We've probably, in terms of total dollars, we're actually still pretty small compared to a lot of stuff in the valley. I think we've raised, in terms of primary capital, sort of capital into the business, we've raised probably close to 200 at this point and then we've done some secondary work. That's just the history. We're at 16 years with both early investors as well as through your classic venture and private equity.

Now, here's the history. First off, trying to raise, particularly in the fitness sector, don't kid yourself. I don't care whether it was 2009 or 2025, it's hard. People want to understand the TAM. Imagine going to them and saying, our target is mammals, these road cyclists, and then trying to explain TAM. It was falling on deaf ears. That's why we were accused of being a hobby. That's when we kept saying, go to market, here's a vision. If we believe that 10% of the world's population is active and there's 7 billion people out there, there is somewhere between 500 and a billion people who are active right now. That's a big market. We played a lot with that math just to get people out there and understanding it. The second thing that worked really well for Strava was we had to identify people who weren't just great investors, but they were active people themselves. They had to understand the domain. If you look through the first four or five financings, every one of those financings, whether it was led by a firm you've never heard of, or it was led by Sequoia Capital. Sequoia Capital was Mike Moritz. He made the investment. He's an avid cyclist. He's a triathlete. He was on Strava, enjoyed the experience, and he got it. He understood it. Whereas I can tell you, a number of his partners did not, and they were hugely skeptical, but he had the will and he had the ability to get the deal done, so he did. Find those people who understand your space and believe in it, and if they don't, move on. Don't take it personally, but don't waste your time. It's not worth it.

The last one I'll tell you, I always joke, speed over greed. I really mean this. I'll give you one example. The Kana business that I built in the 90s, so here's some math for you. When we did our Series A, we raised, well, the first offer we had was $300,000 for 40% of the business. We're like, wow. Now, again, I was 25. I had no operating experience. I had a degree in art history. I'd never run a company before, so I walked out of that meeting and I thought, well, somebody wants to give us money, but I also think they're robbing us. We went back and we negotiated really hard and we managed to get $700,000 for 40% of the business. We sold 40% of our business in the Series A. Now, that's the bad news. The good news was four years later and only two rounds of financing later, we had a company worth $10 billion. Despite selling 40% of the business, let's just say that my little slice that was still left was pretty damn good. Speed over greed. You don't have to own the whole thing to somehow do really well. I think that sometimes we get lost in the region. We want to sort of optimize every little thing, but if you found a great partner that you know and can trust, that you think can add value, and they're being fair. That's the one thing is you'll see these investors try to throw everything but the kitchen sink into their terms. That's not who you want to do business with. You want to do business with somebody. The economics might be a little tough. The markets are going to tell you what the values are right now. It's not rocket science, but if they're trying to throw in all kinds of prefer and this and that and everything, and they're going to put these restrictions on who you can hire and when, they don't trust you. You shouldn't trust them. I go for a partner that I know I can trust, who's going to have my back, who has great references, and let's just go do a fair deal and let's go. Because the sooner you get them off of the negotiating side of the table and on the year side of the table, really good things happen. I've been really fortunate. I mean, my partners have been outstanding. They're 16 years in at Strava and not a single investor has sold a share. Now, I think they're pretty happy with the growth and that's probably why, but it's still a testament to the fact that they are long-term holders.

And from a product perspective, the Strava from cycling and running, expanding to so many other, so even I can put my windsurfing, I see my windsurfing lately there, but how can you keep being authentic and speak the language to so many different people when the product expands in so many areas?

The short answer is it can't. And so we made a fundamental decision. I'm looking over here at the hybrid team. It's like, we can't possibly go and be authentic for every group who is active out there today. We were able to do it for the first two, definitely running and cycling. Those are the big markets. We needed to get that right. We then made a strategic change. This was about 2014, 2015, which is, it'd be better for us to partner with those who are doing really authentic apps and services and how can we help them be effective? So an example would be like a ski app. We've all, I don't know how many of you ski out there. I enjoy skiing in the winter. There's half a dozen great apps out there where you can track your skiing. You can track it on Strava, but we are not going to go into the detail that a skiing specific app will. Instead, we just want to make sure that they can integrate with Strava. And if there's a way that we can then push potential customers to them, because we've got a large audience, let's figure out how to do it. So I think today, we're about a hundred, you and I talked about this, but 110, 115,000 API partners Strava today. It's a big app ecosystem. It's a lot of the brands and so forth. But the thesis was somebody out there is doing something really authentic for a community. How can we be helpful to them? And let's put the two together.

Can we speak a bit about how did the fitness and health market change since you started Strava 2 today? What have you been seeing in the market changing?

In some ways, it's what's changed and what hasn't changed. The biggest thing that I remember, I remember a chapter where we love to joke that our world is all about co-operators. They really aren't competitors, but they're also not partners. You can use lots of different apps to track, but then we also work with them and it's just, it's a tricky space. And so we had a lot of competitors slash co-operators that were getting acquired by the major brands. Runkeeper was acquired by Asics. My fitness was acquired by Under Armour. Oh gosh, I'm blanking out all the different, Nike had their own native app. Like there were all these spaces and they were all owned by now these big sort of fitness brands. And we were nervous internally. We're like, hmm, boy, they've got more marketing dollars and so forth. But the takeaway, and I think this is valuable for any of you, when you look at sort of these larger industries, at the end of the day, these big brands, they do one thing exceptionally well. In their case, they sell footwear and apparel. And that's a tough business in its own right. We don't want to be in the footwear and apparel business. We don't want to figure out how to manufacture shoes. And what we learned was that they didn't want to be in the digital business, or at least they weren't very good at it. They ended up turning a lot of our competitors into their marketing channels. And all of a sudden the consumer realized they were just being marketed to instead of actually getting a genuine experience from them. It's why Strava has remained independent, is that we like this idea of what's bringing the brands onto the platform, but we don't want to be sort of slave to one where now all of a sudden our consumer is the product. And that's, we sort of seen this massive shift, or I think now we've actually watched the brands realize, when I say brands, the Nikes and Adidas and Under Armours and Lululemons of the world realize they can leverage the Stravas and others to have an amazing online footprint, but they don't have to own it to do it. That'd be one example.

The other thing, Mark, I think the, I come from Cyprus, it's a very small island in the Mediterranean, and usually most of the trends do not hit the island. I remember since many years ago, people were running with Strava shirts everywhere. So what does it take to build a consumer brand that has so much loyalty?

Yeah, this is the other thing you and I were talking about offline that I, this is one of the ones that I'm noodling over a lot, particularly with the advent of AI and how is that going to affect the way we would, how would I start Strava today and build it? And what would I do differently if I had all the AI tools that are coming to market? This is one where I don't think I would change what we did. And what I often tell entrepreneurs is in the early days, you have to be comfortable doing things that do not scale. And so examples would be, we would show up at little tiny cycling and running events, and we would hand out lots and lots of t-shirts. We would literally hand out t-shirts, and at the same time, we would grab their garment off of their bike or off of their wrist, say, hey, we'll plug it into the back of this computer, and you can see what it looks like on Strava. Now, we work around hire thousands of people to do that. But in the early days to again, create that loyalty, and we had this thesis that it's so expensive to go and acquire customers that if we could just get one customer on who is highly engaged, and they could tell their friends, that would be a cost effective way of growing. And in fact, if you look at Strava today, we're 16 years in 97% of our growth is still completely organic. We add between two and 3 million members every month. And literally 97% of that comes through word of mouth. So we did things early on to go to these events to set up pop-ups. We did these crazy branding. I'll give you a funny example. We did something with Lululemon during a London Marathon one time where they opened up a – they basically took over a pub that also they had a little sort of running store inside or a little sort of Lululemon store set up. Sorry, this wasn't Lululemon. It was New Valence because they had the running store. It was New Valence opened the pub, and the only way you could buy a pint of beer in that particular pub was by uploading a run and coming in and using the miles to pay for it, right? So we were just constantly looking for these creative in-person things that, again, they may not scale over time, but they create uniqueness in the market. They get this word of mouth going, and I'm no regret at that. Again, what we learned, the lesson here, just real quickly, engagement trumps growth almost every time. Anytime Michael and I would focus on growth and try to look at all these growth drivers or think about growth marketing tactics, we would have a problem. We might bump it for a little bit, but our retention was really, really bad. When we focused on engagement, I don't care whether your customer is an enterprise business or is a consumer, a drawn consumer, if you're focused on ensuring that that one customer that you get stays excited and stays engaged with your product, they are your best source for future revenue.

The other couple of questions I wanted to ask you, Mark, is considering AI, what do you think is the future of communities? Are there going to be communities? Is this going to change a lot?

Yeah. Yes, in part because I get to define community in my own unique way, but it's a little bit what I touched on earlier. I think in consumer, one of the things we have to be mindful of is how we apply a lot of this amazing technology that's coming down the pipe, but in a genuine, authentic way where we still feel a good connection to it. I keep referring to conversations you and I just had, where I see a lot of community thriving today is in real life, is in the personal stuff. I mentioned earlier about the things that Strava does that doesn't scale. Ironically, we still show up even 16 years later and with all the employees we have at the real life events, at the run events, at the cycling events, and not just sort of a big New York City marathon, which obviously we'll do, but in those Saturday morning fun runs or just a club. I believe community will thrive. In some ways, it will be the antidote to some of the AI and sort of what we're dealing with is sort of to have personal connection. I think it will be different. I think the way we define community over the last 15 years at Strava, where it's largely bringing this digital community together, we have to be mindful of sort of how does that continue to scale and yet feel authentic? But no, I'm as excited about community building as I ever have been. It's, yeah, what is the role of AI in the middle of that? That I'm not as sure. I can point to all the areas in Strava where we're applying AI. I don't think it's touching what I would define as community.

And then if you are in the shoes of folks today, if you are 20 years old again, and you wanted to start a business, or maybe would you start a business? And then if you would, what would that be?

Oh, well, there's already a domain name that's been created. So since I've retired from Strava, once an entrepreneur, always an entrepreneur. So I'm already tinkering. And the good news now is that I have twin boys that are 24. So I am like recruiting hard to get them to be the entrepreneur. I can just sit back and watch. So I think it's amazing time. Yes, I want to keep building and keep just what you guys are doing. I'm just not sure I have the same energy that you do. But amazing time. And what excites me about it, I'll go back to my history. I mean, I was an art history. I had no business running software companies. And so when I w

The Pizza That Lured Developers

Mark: When I would come up with an idea, the first thing I had to do was convince really smart developers to join me to build it. At Kana, it was things like offering free pizza, great computers, whatever it took. Strava was a little easier because we found great engineers who were also passionate about cycling and running. We had a track record that got them excited about building. I was playing with Claude the other day, and you could almost argue that I wrote code. It was hilarious. I don't want to say I built another Strava, but it was pretty good. I get excited about the speed at which we can iterate and test. Just don't do it in a vacuum. Put it in front of real users. If you know your audience, go test it. It's not just about how fast something can compute, but how quickly we can put that app in the hands of somebody and watch them use it. What do they like and don't like? That excites me.

Storytelling Secrets from a Strava Success

Kyriakos: When it comes to storytelling, Mark, you are one of the best in the world. How would you advise people to learn how to speak to customers, investors, and tell the best stories?

Mark: There are some great storytellers out there. Either you haven't met them, or we're in serious trouble. My first piece of advice is to listen. I'm sitting here talking and not necessarily listening. To become a great storyteller, go out and listen. It relates to what I just said. I'll tell another story. I sat down with an expert in subscriptions. Strava's business is all about a freemium model on subscription. We met at a Starbucks, and she asked me about our target audience. There were three cyclists sitting over in a corner drinking espresso. I said, "See those three over there? That's my target." She turned around and said, "Nine out of ten times, people say anyone in the Starbucks is a target, and that scares me. But the fact that you picked just those three says volumes about the opportunity and how you can be successful."

Why did I tell that story? Because it's about listening. Those cyclists were good because I could ask them a few questions about their ride. We learned that cyclists love their climbs. It doesn't matter how long a ride is; they obsess over that one climb. That was important for Strava because once we figured out how to auto-identify a climb, segments were born. With a Strava segment, you can build a leaderboard, and now you have a reason to invite your friends to Strava. From a business perspective, that's where word of mouth comes from. It all happened because we listened to cyclists. I can tell you stories all day long, and maybe you'll find something relevant to what you're doing. After 16 years of Strava, trust me, we have stories. Wrongful death lawsuits, being outed by a university student in Australia for revealing secret military bases on our heat map, being investigated by the Federal Trade Commission. You can't make this stuff up. Whatever you think your business will be, it's going to be wildly different. Get ready for the ride. It's fun. Do you have questions?

Metrics That Matter: The Strava Success Formula

Audience Member: Can you share some of the biggest experiments or wins that you ran for Strava to optimize engagement?

Mark: I'll give you three metrics we look at. Two are obvious: in the first seven to ten days, how many people are they following and connecting with, and how many uploads are they doing? If we can get two followers and two uploads, we have a great shot at getting them engaged long-term. The third metric is time active over time spent in the app. We want to see that time active increasing. As a subscription business, we don't need you staring at the screen. Whether you're in it for a minute or ten minutes a day, it's not important. But if you're more active over time, that's good for us. How do you do that? Some of it's simple. Instead of asking you to put your whole contact database in Strava, we have a button that says "add others" when you finish an activity. It's simple and authentic. I can tell you nine more that didn't work.

Freemium Model: The Strava Strategy

Audience Member: For consumer subscription, did you have a target percentage you wanted to convert?

Mark: In the freemium model, the average was often low, three to five percent. We had an interesting problem at Strava. When we first launched, our conversion rate from free to paid was around 30%. You could upload to Strava five times a month for free, but the sixth time you had to pay. Once we moved to feature-based, our conversion rates plummeted. Today, we're well north of 10%. We'd love to get that up to 20%. The Holy Grail is the Spotify's of the world with a 50% rate. At a bare minimum, you should be working between five and ten percent. Make sure you understand why you're freemium. Our free members are extremely valuable to the Strava experience. If your product's not good enough that they're not paying for it, you have to ask yourself why you're freemium.

Running 200K: A Strava Launch Event

Audience Member: For our launch, I'm running a 200K ultra and live streaming it with big founders. I'm putting the whole thing on Strava. Would you like to join the live stream?

Mark: When is it?

Audience Member: This Saturday.

Mark: I don't see why not. Sounds great.

Niche or Not: Starting Strava Today

Audience Member: If you were starting Strava today, would you still want to start with a niche?

Mark: I'm biased, but I still like the risk of being hyper-focused. It's about how I want to go to market, not what I ultimately want to build. It's hard to break through the noise. The power of the niche is that if I know who I'm speaking to, I can get in front of them and tell something compelling.

Single Player vs. Multiplayer: Strava's Unique Approach

Audience Member: You mentioned time active over time spent. Is Strava a single-player app in a multiplayer context?

Mark: We have three metrics: two are single-player, and one is multiplayer. Our thesis is you don't need a huge network, just a few active people. We spent a lot of time on single-player mode. If you don't get that right, there's no community. Strava has both single-player and multiplayer aspects.

Future Fitness: The Next Big Thing

Audience Member: What do you think is the next big technology innovation in fitness?

Mark: AI is an easy one. Athlete intelligence on Strava is surprisingly good. I'm excited about data extraction from performance. Wearables and integrated devices are scratching the surface. We'll be able to do some really cool stuff with that data.

Global Growth: Strava's International Strategy

Audience Member: How did you customize Strava for different countries?

Mark: Part of it is hiring. We have people in key markets who are our greatest listeners. Get ready to travel. I spent a lot of time with users worldwide. Brazil is wild for runners. You go and listen to understand subtle differences. There's nothing better than being there and being part of it.

Strava's Social Side: Balancing Community and Privacy

Audience Member: What are your thoughts on Strava as a social media platform?

Mark: We've grown comfortable with being in that sphere. We've worked hard to keep the experience monolithic. If politics shows up in the feed, we've tried to build a community policy. We're there to support each other. We believe being active is good, and friends can support you in it. We run into negative stuff, but we work on safety and privacy. We are very cognizant of different needs, especially with a gender-balanced user base. It's complicated, but we've embraced social media as part of our place.

Fitness and Productivity: Strava's Core Values

Audience Member: What advice do you have for using fitness to boost productivity?

Mark: Strava has core values: authenticity, balance, camaraderie, commitment, and craftsmanship. Balance means there's always time for a ride or run. We believe it works well for us. If you take care of the team, they'll be more focused. Let them have the time they need. It's selfish because when they come back, they're 100% focused. I'm a big believer in taking care of the team and letting them ride.

User Experience First: Strava's Business Philosophy

Audience Member: How do you align your interests with the users?

Mark: I like simple. Build something good for a customer, and if it's good enough, they'll pay for it. We wanted to build a brand that can be trusted. We used to joke about the tattoo brand. Strava is as important as a bike or running shoes. It's about keeping it simple. Build something for the person who's going to pay for it. That's where you figure out if you have a business. We like the direct-to-consumer model.

Mark, it's been an incredible discussion. Thank you so much.