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20VC: The Chess.com Memo: The Most Untold Story in Startups; Scaling to $100M Revenue, 150M Members and 700 People, All with Zero Venture Funding | Erik Allebest, CEO @ Chess.com

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Feb 7, 2024

Erik Allebest, CEO of Chess.com, shares his journey from being unemployable to leading the largest online chess platform with over 150 million members and $100 million in revenue—all without venture funding. He reflects on the challenges of scaling a startup without external investment and reveals creative strategies for user acquisition, including leveraging trends like COVID and popular media. Erik also delves into personal themes of parenting and marriage, highlighting how his values have shifted beyond money and capitalism.

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ANECDOTE

Third Time's the Charm

Chess.com was Erik's third chess-related venture.
He transitioned from teaching and e-commerce to building an online chess community, acquiring the domain name for $56,000.

ANECDOTE

Fundraising Challenges

Erik initially sought venture funding for Chess.com but faced repeated rejections due to perceived market limitations.
He was told the chess market was too small and uninvestable, leading him to bootstrap the company.

INSIGHT

Beyond Monetary Motivation

Erik prioritizes experiences and personal fulfillment over monetary gains.
Money is not a primary motivator for him, unlike some who view it as a measure of self-worth.

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Erik Allebest is the CEO @ Chess.com, the #1 online chess service on the planet with more than 150+ million members and 15+ million games played each day. Erik has scaled the company to over 700 people and $100M+ in revenue with no venture funding.

In Today's Episode with Erik Allebest:

1. From Unemployable to $100M+ Revenue Founder:

How did Erik make his way into the world of tech and startups?
Was his MBA worth it? How does he advise others on whether to get one or not?
What does Erik know now that he wishes he had known when he started?

2. Scaling to $100M Revenue with No Venture Funding:

Why did no one want to invest in Chess.com in the early days?
What did Erik do differently as a result of not raising any venture funding?
What would Erik have done if he had money from the start?
What are Erik's biggest pieces of advice to founders with funding today?

3. Hard Lessons Scaling to 150M Members:

What are 1-2 of Erik's biggest lessons on how to scale users with zero budget?
What customer acquisition worked? What did not work?
How important was COVID and The Queen's Gambit to memberships and sign-ups?
What are the single biggest mistakes Erik sees founders make on customer acquisition today?

4. Parenting, Marriage, Metrics and Money:

Why does Erik not care about money or capitalism today?
How has Erik's style of parenting changed over the years? What works? What does not?
What does Erik believe is the secret to marriage? What have been his biggest lessons?
Why does Erik hate metrics? If so, how does he run the business towards goals and output?

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