PRODUCTEA with Leah, Growth & Senior Leadership

57: Erik Allebest - From 0 to 150 million ARR - The Chess.com story

May 12, 2024

Erik Allebest shares the Chess.com success story, from 0 to 150 million ARR. They discuss making chess accessible to all, the challenges of scaling, importance of passion in hiring, and balancing CEO responsibilities. Chess.com aims to engage users beyond the chess community, focusing on growth for the game's sake.

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INSIGHT

Layered Product Creates New Market

Chess.com built engagement around an immutable core product by layering community, content, and tools.
That combination turned a static game into a product-led, media-driven business with wide cultural reach.

ANECDOTE

From Club Home To Robust Chess Server

Chess.com started focused on existing chess players and became their 'home' before building play features.
The team underestimated how hard building a chess server would be and learned by doing over many years.

INSIGHT

Media Drives Distinct Cohorts

Media moments (The Queen's Gambit, Twitch streams, viral creators) massively broadened the demographic of chess players.
Different acquisition cohorts behaved differently (e.g., Gambit viewers took lessons; later spikes were kids who mostly played).

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Summary

Chess.com has grown from being a simple chess service to a thriving 150 million ARR business. The company has focused on making chess accessible to everyone through services around a product that hasn’t changed in centuries.

We touch on the challenges of scaling a company and the role of titles and leadership in an organization and how many times Erik wanted to give up in the process.

Erik talks about the need for passion and love for the product, and the importance of hiring people who align with the company's mission.

Takeaways

Chess.com has expanded its user base beyond the chess community by making chess accessible to everyone instead of just pros.

Titles should not be the focus, and it's more important to hire people who are passionate and aligned with the company's mission more than anything else

Finding a balance between managing the company and staying involved in the product is key for being a CEO at a scale of 500 people and more.

Sound Bites

"Anyone can have a relationship with chess. It doesn't have to be old white guys in suits. It can be all genders, all ages, all races, all countries, all intellectual capacities. Chess is for everyone."

"Chess.com could not only serve the community, but we could grow the game and change the definition of who identifies as a chess player."

"Our next phase as a company is to be an engagement-focused business and drive revenue to invest in building the game and driving cooler media."

"Making money is just the fuel for the mission"

Chapters

15:39 Expanding the Chess Community

30:08 The Role of Growth Teams in Retention and Value Creation

37:03 Understanding User Cohorts and Behavior Tracking

39:21 Driving Revenue Growth Through Churn Analysis

41:29 The Role of Revenue in the Company's Mission

45:02 Using Metrics to Drive Product Improvement

54:04 The Challenges of CEO Responsibilities

01:02:32 Separating Leadership and Management Roles

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