#31 – The story of Erik Bergman

Summary

After leaving Catena a couple of years ago he bought the domain name Great.com for almost a million dollars, on this new adventure he will start all over again but this time give away 100% of the profits. Do you want to know how it happened and how you could do the same thing?

Transcript

[00:00:01] All right.

[00:00:02] Today will be a portrait episode of no one else than Erik Bergman, the founder of Great.com, and previously his story is that he found online marketing company Catena Media that is now valued at hundreds of millions of dollars.

[00:00:23] And the cool thing is that this only took about five years to create a company of now over 400 employees. And now Erik had founded a new company, great dot com domain name that he had bought for over 1 for close to one million dollars.

[00:00:42] And that is a company that would give away 100 percent of its profits to charity.

[00:00:48] Eric, how are you today?

[00:00:51] Feeling very humble of that introduction. And good.

[00:00:55] Awesome. I can see now and if you’re watching this on YouTube that you are in your childhood home in south of Sweden. So tell me about your upbringing. When did entrepreneurial journey begin for you?

[00:01:13] Ok, so let’s start with the second part of that question and I’ll I’ll share a little story, if you don’t mind.

[00:01:24] Yeah, I’m in front of this this big door and I’m all dressed in red and I really don’t want to be here. I’m scared, but I made a promise on their. And reaching up. And I’m knocking on this door. Hear footsteps on the other side of the door. And an old grumpy man looks at me when he opens. I look at him and. And I start to sing.

[00:01:57] So interesting Jingle Bells. And I’m with my brother. He’s 7 years old, I’m 4 years old, and he has drag me out to sing for our neighbors because he figured out that we can probably make money doing this. And it turned out that we worked this old grumpy face shined up in a big smile and we started to sing for our neighbors ever since. I think that was the first business ventures with Biggs quotation marks that we did.

[00:02:24] And did it pay you to grow away or what was the business model? I’m not sure. But they paid us. I don’t think I cared if they paid me to go away or if I say no. Because I was cute.

[00:02:35] But I think that this this explains quite a bit of how it started. And my brother had all kinds of these ideas. So my family is not entrepreneurial in any way. I would say my mother and father don’t take risks. They don’t. That definitely known financial risks. And my brother had a lot of ideas like this. We did a lot of small little business ventures together. He he did them. I joined I was the cutest one and got to seeing where I got to sell lottery tickets. I got to sell Brad and I got to collect soda cans. And we did all kinds of things.

[00:03:10] So that was the very, very first business. And my childhood looked a lot like that. Even though my my family was nothing like that other than my brother.

[00:03:20] So were your parents supportive towards your entrepreneurial spirit?

[00:03:26] You would say that they were they helped out. I mean, especially one thing that comes to mind was that so we gather these soda accounts in Sweden, if you return a tin can to the store soda cans, you get about 5 cents while you get used to get fucked sounds. And me and my brother, we went through all the trash cans around on the beaches and we filled up our little playhouse in our garden with these. And our parents helped us. Took everything else out. Put it in. There is smell like shit. They got a lot of wasps because they really like the soda, but they supported that already then. So yeah, I’d say that they supported all our various ventures.

[00:04:04] So what was the first real business trend that you started?

[00:04:09] Like a company like your company. Kids say, in my teenage years between 17 and 19, I started all kinds of things more or less simultaneously. I tried to become a party planner. I failed brutally. I was the most horrific day of my life. But that’s a longer story. I started a business when I was going to print on underwear and I was sold zero pairs of underwear completely failed. We started a lunch guide with all the restaurants in our hometown, made zero money, lost a lot, failed, and all of these happened. I’m not really sure in what consecutive order, but this was minus 17 to 19, kind of go up to 20 percent of the web agency. Together with my childhood friend e-mail. That was the one who also started. And I would later on and that became the first real company that actually got clients. So we did websites for hairdressers, printer shops. We got one big client. That kind of made the money business a little bit around. And this all happened late, late teenage years. Was these kinds of thing.

[00:05:17] Right. So you got some practice with your friend e-mail, but you then started Katrina Wood. What kind of business was lost? Katrina.

[00:05:28] So we started with it with a small verb agency. We’re gonna build small, simple Web sites for clients like hairdressers and stuff, but we weren’t good enough at selling, so we didn’t get enough clients. So instead we started building websites for ourselves about various things. And one of the first things we started building about was about online bingo. And we made money by what compared different bingo sites and different offers. And then when visitors came to us from Maine and from Google and search engines and then went onwards to a bingo brand, we got paid from that bingo brown from being recommending them and stuff like that.

[00:06:05] This is called affiliation and lead generation. And this became the the foundation of what later became Katina. I don’t know, like three years later we start nicotine or something, but this was the original idea. And then that idea just scaled up to a much, much bigger way and focused on on casinos. It’s actually a very, very simple thing. It’s similar to what hotels dot com does in the hotel industry, like they list and tell you a lot about different hotels and what you can do, but they don’t actually have the hotels. So they get paid when you do a booking. And we got paid when you started playing in another bingo site or a casino.

[00:06:42] So it’s a very simple business model. And Jeff, Katrina today, today’s valued at hundreds of millions of euros. What did you guys do then? Other competitors didn’t do or didn’t figure out.

[00:06:56] So to start with, we, me and Emily was a very good team. He was a computer genius. He built his first calculator when I was eight. Really smart guy. I knew absolutely nothing about computers, so I still barely do. I can I can master my way through a word document and that’s about it.

[00:07:15] I’ve never seen someone use short commandos on a manicure. Do as you do, though. It’s it’s like a miniature. Yeah. Very good.

[00:07:22] With quick commands being a cop program for shits. But I know all the quick around. So short shortcuts cause the shortcuts. Yeah. So what we started doing that I don’t think others did was that we came up with ways of scaling where most of our competitors were doing things manually and we came up with ways where e-mail build computer systems that just scaled. So what would manually would have taken a lot of hours to do.

[00:07:47] And we had a system that did it in 10 seconds. So it started with there where we started automating things early on when our competitors didn’t. So I think early automation was something that made a big difference for us where I kind of understood what would be beneficial to do. But I had no idea how to do it. E-mail was really good at taking my ideas and making them happen, which I would never be able to do without him. So we were a perfect team there and that made made a big difference.

[00:08:17] And what kind of tasks were automated?

[00:08:21] So, for example, we built a lot of small websites. We had thousands of small Web sites which, if you were doing this manually, would need to go at these settings, find these templates, put in these text, have this picture, all of these kinds of things, and a lot of manual work with one site alone, a lot of settings in different places and and built a system that automatically bought a domain. Did all of these things in one place so we could run. We had one one control panel for a thousand Web sites and then his system did everything to these sites. That’s just one thing that scaled everything up very well.

[00:09:02] And why did you need a thousand sites?

[00:09:05] Yeah. So here it gets a bit complicated from how Google works, but in short, the more sites you had, the better we could rank up in search engines. Very, very briefly, it’s it’s quite complex.

[00:09:20] Right. So.

[00:09:23] Ok. Close enough. OK.

[00:09:26] This was just one of the things that we that we did differently early on. But I can also see that we we took on investors quite early on, which our competitors did, and that so most of our competitors were computer geniuses, but they didn’t really know business. And we had the luck of finding good investors that really knew business and knew how to hire people, build teams in these kinds of things. So when our competitors were mainly really good at computers and building websites, they didn’t know how to build a team or how to find outside.

[00:09:59] Investing in stuff like this sort of competency you got in was as important as the finances.

[00:10:06] Yeah. And far more important than the finances. I would say. And it raised our ambition level a lot. So we had great timing. We came into this industry, had a great time. I was very lucky to be there and in other industries I would have been less successful. But we also did a lot of things right where we scaled when others did, and we took risks when other days and we hired a big team where when others did.

[00:10:30] But what happened? Because you go from being a guy selling lottery tickets. Now you’re singing to your neighbors, to being two guys, maybe in a basement somewhere, building websites to having investors.

[00:10:45] And I guess you took in a lot of money. Maybe you had employees. How did that transition come out? Was there a lot of struggles there?

[00:10:54] Ok. So the first Web site we started, I think was in 2007 or 2008. That was about bingo. And I was 20 at the time. And the first year is only made a thousand euros in revenues. So it was it was a hobby we played around with. Second year, I think we started to make maybe a thousand euros a month. And so we’re still not a big business for two people. And the third year 2010 was when we started doing this full time. So that’s kind of when Tina started ish and we started playing around with this and building things and actually understanding how to scale this. In 2012, it was still just me and e-mail and two employees or two teammates. And we took on investors that came in and bought half of the business and they had way, way bigger goals and intentions than we ever had ever dreamed of. So they kind of helped us to understand how can we employ a lot more people? How can we scale this, what can we aim for? So then we hired 10 people in a number of weeks and started to really put all our money back into the business and scaling this.

[00:12:05] And what were these guys doing then? What what kind of people did you need at that point?

[00:12:10] So we started before that we were only working Swedish and now we started working in several different languages. We need people who could write text in different languages. We need a designers that could help us to create. We needed more developers because otherwise Ehrman was doing all the programming and we need someone to be in charge of the sales. So this was the first like 10 people doing these kinds of things. And the first year almost went bankrupt because we took way more risks than we could handle. I completely miscalculated when we were going to start making money. So we went down to almost sero in the bank accounts and I was worried about how we were going to pay salaries even. And then it turned around. And to this day, I don’t really know why it turned around when it happened, but it happened luckily. So I’m thinking my lucky stars for that. And yeah, basically what we what Google started loving us and we started getting a lot of traffic that I didn’t quite understand why it happened.

[00:13:09] Interesting. And so then you started scaling up the business more. How did you feel about that? Well, that’s a natural thing for you to do, to just move up in magnitude and stakes, or was this kind of getting out of control for you?

[00:13:25] I don’t think I thought that much about it. I think it just did. Looking back, it felt natural to hire more people. I think.

[00:13:36] This this urge of mine, of growing something and reaching for the stars, that comes very natural for me, I didn’t really think about that. There was another way of doing it. It was definitely very hectic, very stressful, and looking back, I wasn’t healthy or happy doing it. It took a lot of my energy. With everything. But I’d never stopped to really think about what I was doing. And after that first year, 2013, when we took on investors and we all went bankrupt in one financially very, very well. Everything that we touched turned to gold and every deal that we did became immensely successful. We came into play in a place where. Yeah, we had wonderful timing in everything that we did. And that went on for a couple of years, and I think that thanks to that, thanks to that constant tailwind. Everything is going our way. It didn’t really matter that I was running over my capacity or that I was pushing myself too hard or that the team was pushing itself too hard and did an amazing job because we never stumbled. So we didn’t fall.

[00:14:51] That makes sense, right? And still, though, you went from two employees to hundreds of employees in five years. There must have been even though you had tailwind, there must have been a lot of growing pains. A lot of challenges and stuff.

[00:15:08] Yes, definitely. I think the toughest thing for me has been to deal with with people and.

[00:15:18] The times when I feel that while I didn’t really treat this person right or this didn’t become well or one way or another, I was unfair to people. And people got hurt and I didn’t really realize that I. Looking back, I can see I did a lot of mistakes, but I didn’t realize at the time. So the toughest parts were definitely when there were battles with employees one way or another or someone had been let down and. We had one situation where there was a big misunderstanding and eight people quit their job in one week and they were close friends of mine and.

[00:15:55] I can see what I did wrong now when looking back, but I didn’t at the time, and that was just so painful and I think that the worst part about running a companies and the best part about running companies is the team.

[00:16:09] And it’s the same with family. I mean, the best thing about family is family. The worst thing about family, his family. It’s it’s the same thing. So there were definitely a lot of struggles around those things. And that was tough, right?

[00:16:24] What kind of qualities in you what kind of personality traits you as a person made you persevere through all of these challenges?

[00:16:39] So one thing. That comes to mind is a naive, optimistic approach to life. I think if I always looked at a problem and kind of thought that it would solve itself, it never did. But it’s coming. Yeah, yeah, we will figure it out. I think naivete made me take greater risks than I should have done. But it turned out well.

[00:17:04] Most of the time I think I’ve been good at asking for help early on, finding people that can help me and that wants to help me.

[00:17:15] And.

[00:17:17] I think that I’ve been implementing ideas very quickly, I have tested a lot of things. I think it’s impossible to know what’s going to work if you’re not testing it out. I think that was another key part of the success.

[00:17:32] Right. And I’m curious, your personality ambitions shooting for the star. Being naive, optimistic, loving entrepreneurship. Do you think you would have succeeded as well in another business?

[00:17:52] So I think that we got into this industry with perfect timing and that became a very big part of of our success. I think that. I have high enough beliefs in myself to feel that I would have been successful at most things that I’ve tried. If I gave it enough of a try, I would come up with ways to make it work. But success to this extent that we had wouldn’t have happened in many other places, in most other industries. There would be a lot less success. And a lot of this came from. From luck and timing and from where the industry were and the partners that I somehow ended up with, the team that we found and a lot of people around it. That was kind of out of my control. So I think that I would have succeeded at pretty much anything that I really tried, but not to this extent. All right.

[00:18:49] And you can indeed both ride the drive and luck to succeed at that level. Now, in 2016, you took Katrina live to the stock edge. You took it to the stock exchange and you sold personal shares for tens of millions of dollars. How did it feel that day when you kind of knew that? All right. This ship is a chore. Who?

[00:19:19] Oh, that’s actually a very good analogy for how it felt. This ship is at shore. It felt like I’d been out on a very, very bumpy sea. It’s a hell of a long time to give it a buck. Yeah, I felt that. Yeah. Imagine that. You’re at sea. You’re on on this this big wooden ship like in the 15th century or something.

[00:19:42] And you first just sailed all the way to India from Europe and you’re on the way back and you filled the boat with gold and treasuries and all kinds of you know, that you have a lot of value here, but you’re on a very, very stormy sea and there’s a long way home. And a lot of times you are afraid that you’re just going to sink. Everything’s going to crash and burn. You’re never going to be able to bring this gold home. And that was the way I felt a long time. Fuck, I’m falling. Fuck. This deal is going to go badly. Fuck, we missed these targets. Oh, shit. There were a lot of those situations where a boat would be rocking and almost going to the sea was sinking. And then, yeah, we reach the shore. We we arrived saved in the harbour. And I think the main feeling of that was just such a big sigh of relief. So I’ve felt that we’ve been carrying the goal for a long time, but just being able to finally get to shore was very relieving. Mm hmm.

[00:20:44] Who could imagine that? And you made a personal fortune, yet still like you could go to Caribbean Island somewhere, drink pina coladas.

[00:20:57] Have a good time. Do whatever you want. And still, I know that you’re now starting a new business. Great dot.com. How come you don’t just shell out? Sure. Why go back out to see.

[00:21:11] Huh, I like the analogy of the sea. Yes, I think that I’m a sailor at heart. It’s like I want to be on the sea. I want to see what kind of treasures I can find elsewhere. It’s who I am. I want to find some beautiful mermaids. I think a part of me would like to shell ashore, go to this Caribbean island and just be there. But a much bigger part of me wants to build things both for the for the love of creating, but also for the feeling of of importance and being valued and contributing to something that if I’m just sitting there, I’m not important to anyone and I want to be important. That’s a big part of who I am. I want to that’s been an urge for my entire life. And it’s always gonna be. And so I think that I would both be restless for just not doing anything. And I would feel bad about myself. I would feel shame for not doing something meaningful with my life. So that’s that’s why I still do things like that urge to be important.

[00:22:22] Do you feel like that is what inside of you is coming from? Do you think that is kind of your ego wanting to be in the limelight or how do you view that emotion?

[00:22:36] It’s definitely part of it is comes from an insecure little boy within me who just wants attention and wants to be loved. That’s definitely part of it. Part of it, I think, is. It’s very healthy. I mean, I I love the idea of being a leader. I love to be in the idea of being a captain of the ship. It’s it feels very, very natural to me to be in that position. That’s just who I am. I think that even as a lonely child and didn’t have many friends, but I still identified myself as a leader somehow.

[00:23:12] So that’s why I think that’s really cool.

[00:23:15] Like the captain should give praise when it gets back to shore because he’s bringing spices and stuff to all those people. Right. I can see that. It’s a good thing the captain has a drive for those applauds.

[00:23:27] Yeah. Yeah. I think it’s both an insecure child in me that wants the attention and a proud king in me who kind of feels, yeah, attention is just part of my life.

[00:23:37] Right. And noble, great column for close to a million dollars. And the idea here is to create a company that would give away 100 percent of his profits. You’re investing money, but you’re not going to take anything out. I think many entrepreneurs and I’m guessing now would view this as a pretty shitty business model. Well, I just want the truth. No profits.

[00:24:02] It goes back to this. I. I have more money than I’m going to need in my life. And I don’t think that more financial money for myself would make my life any better. At the same time, I think that more money for other people would make their lives significantly better and my life better by doing so. So I think that this is there. There is a lot of things out there in the world that I would like to see changed and where I would like to see things being better. At the moment, I’m feeling strongly about the environment and what’s happening with our seas and the poor polar bears that don’t have an ice left.

[00:24:39] And I want to be the change for those suffering creatures. And if that’s.

[00:24:48] If one were helping in my way of helping could be to build a business that gives away 100 percent of the profits, then I think that’s my main way of doing so, or it’s something that resonates very well with how I want to live my life. I want to build businesses. I want well, I want to be important. And in this, I want to be important for the polar bears. It’s part of what I’m doing this for and. Yeah, just like the idea of still wanting to build, still go out at sea again. I’m heading for India once again, but this time I will give away all the spices. I’m not going to keep them for myself. Someone else can get the curry. And so, yeah, that’s it just feels very natural to me.

[00:25:26] I like some of that. Awesome. And how do you see your own life? Look, and let’s say you wanted a better future for the planet. Right. But your own life in ten years won’t make you happy. If it would be the circumstances.

[00:25:41] So the first thing I see is it’s actually a house outside of Stockholm somewhere and three little happy kids running around. So I think it’s my uterus telling me that it’s starting to get time to teach kids. It’s definitely it’s actually the first thing I see, which feels beautiful. And with regards to like great and these kind of things, I want great to be. First, I wanted to have a big revenues and actually making a big impact that we’re donating a lot of money to various rainforest projects and cleaning up the oceans from plastic and these kinds of things and getting to a point where we actually funnel a lot of money out there all the time. And we do that by having products that we’re really proud of, that actually in itself make it easier for our visitors to do what they want to do and have good help and really feel that this is adding value. We’re really proud of just looking at that. I want to feel that when I’m clicking around on our Web sites, it’s the same feeling as an engineer at Ferrari House when he’s touching the leather around the seat or hearing the engine roar is like, I want to get to point B. That quality is there. I haven’t had that before. Being good at scaling things, but not so focused on quality. And I want to be a place where we do a lot of podcasts like this will create a lot of other content on social media. Instagram you too, Joe. Dot you or whatever will be big ten years from now.

[00:27:07] I like Star Wars and.

[00:27:11] To be at the place where a lot of other organizations and people are very, very inspired by what we do and want to do the same thing maybe reaches out for us for inspiration or for help or guidance and these kinds of great like organizations just popping up like mushrooms all over the all of the globe, hoping to be there in ten years.

[00:27:35] I think that’s a beautiful vision, being able to inspire other organizations with this story. Do you want to die at sea, Eric?

[00:27:43] If you’re on a diet? No, I really don’t wanna die at sea. I know that allergies take it too far.

[00:27:52] I take it I don’t want to take that anymore. Take a couple of years a tour before you die. All right. I don’t want to jinx anything. We’re coming up towards the end there. Is there something you want to do before we wrap this up?

[00:28:05] No, my mind goes quiet. Yes.

[00:28:09] So I think that the running a company is should be funded. Well, it is fun and it is a lot easier to start. So if you listening, thinking about it, give it a try and start as a hobby. As I mentioned before, it took us three years before this was even a business. First year we made a thousand euros. It doesn’t have to be a big thing. You can start with an hour a day. And I think that’s one of my life models. Just started and see where it takes you to do that.

[00:28:37] Awesome. And if you have any more questions about Eric James’s journey or something you would like us to talk about in the future. Send us an e-mail to podcast. Great.com. All right, Erik.