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Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

It was February 2010. We were noticing that a company named Groupon was taking off and a whole new industry was booming along with it.

Our idea for Yipit was simple, aggregate all these daily deals being sold by different companies and put them in one email. Plus, you could specify categories so that your emails were personalized.

The only issue was that we were working on a different product. The idea of trying yet another concept was exhausting.

So, we compromised by giving ourselves 3 days to build it.

In the first two days, we quickly built an email capture, sign-up flow to collect preferences and a script that would send people an email with the deals that matched their preference.

But, how would we get the deals in our database and categorize them correctly as “restaurant” or “concert tickets”? We would have to build a crawler to parse the deals from HTML from various sites and write a classification algorithm. Not a daily task for us.

So, we took a shortcut. Instead of building a crawler, my co-founder and I would crawl out of bed at 3 am and manually enter the deals into our database. Plus, when you’re doing it yourself, classification was easy. We did it all manually.

Within 3 days, we released Yipit and it took off. We got press and became known as the leader in the industry. Three months later we raised $1.3 million and a year later another $6 million. Today, we’re 25 people, over a million people have signed-up and we’re on a path to profitability.

The funny thing is that within a few months of our launch, several competitors emerged and they all had crawlers. But, from our users’s perspective, we were more advanced since we had categorization which was definitely no easily automated task.

We didn’t actually build a real crawler for the first 9 months and just kept scaling manually by hiring more data entry professionals. Instead, we were able to focus our resources on improving the product and user acquisition.

It’s now clear to me that not building that crawling technology early on was one of the reasons our startup succeeded.

Taking this “manual-first” approach was our secret sauce.

Many Startups Take the “Manual-First” Startup Approach

We’re not alone in our “manual-first” approach:

  • AngelList started with Nivi and Naval manually collecting startup applications and manually matching them up with potential investors. I know because Yipit was one of the first startups to use AngelList to raise funding
  • ZeroCater, a Y Combinator company, started with just a big spreadsheet trying to connect companies with restaurants that would cater
  • Groupon started with just a WordPress blog and manually sending PDFs with the first vouchers
  • Grouper, another Y Combinator company, also started with just a spreadsheet trying to match groups of people on dates

Benefits of the “Manual-First” Startup Approach

There are many benefits to taking a “manual-first” approach to some of the trickier technology challenges including:

  • Fastest way to get to the “moment of truth”. Having your potential customer evaluate your product and see if it addresses their need is the moment every founder is trying to get to and doing things manually allow you to quickly get there.
  • Easy to change your solution if it doesn’t work. There’s no code to re-write, there’s no sunk cost. You just have to change how you’re manually doing something.
  • Will really understand what to automate with tech when you’ve been manually doing it. When you’ve been manually providing the solution, you’ll know exactly where the pain points are that you should be automating.
  • Can really wow your potential customers. When you do things manually, you can try different things that really wow the customer and see which ones are worth trying to scale.
  • Customer doesn’t know how your product works behind the scenes. They won’t judge you for your manual approach because they don’t know that’s how you’re doing it. All they will care about it is that your product works.
  • Your product will “just work”. Because you’re manually providing the solution, the product will just work. When trying to implement a solution with technology, it can be very hard to make sure that it just works.
  • Helps you focus your time on the problem, not the solution. It’s very tempting to fall in love with the technology behind your solution only to painfully realize that the problem you set out to solve isn’t a real problem.

Next time you’re building a new product, I hope you’ll consider a manual-first approach to some of the trickier aspects of your solution.

Reid Hoffman, founder of LinkedIn, once said: “If you’re not embarrassed by your first release, you probably spent too much time on it.”

I also think it’s true that: “If people don’t laugh at how you first implemented your product, you probably spent too much time on it.”

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

I remember reading the first few pages of Steve Blank’s book, Four Steps to Epiphany, and thinking two things:

  • This is not exactly a page-turner
  • This is a really smart way of thinking about startups

Soon after, I started attending the Lean Startup meetup in New York and reading Eric Reis’s writings. I was believer.

One of the main principles is to release an early prototype of your idea to potential users to get their feedback.

But, despite being all in on the Lean Startup movement, we didn’t do that.

Why Didn’t We Release an Early Prototype?

Our current idea, Yipit, would find all the deals happening in your city (sample sales, happy hours, retail discounts) and would send you an email with the best 7 based on your interests and your locations.

It would have taken us just a week to have launched an early prototype.

We could have measured success based on whether people opened and clicked on the emails. We could have manually created the emails with deals we found and used MailChimp to send them out. There was no need to build any tech infrastructure.

But, we came up with all sorts of excuses why we just couldn’t release an early version.

Six painful months later, we finally put out the product. It didn’t work which was okay. What was not okay was realizing that our excuses for not releasing earlier were all wrong.

The Excuses We Came Up With

The bright side is that, 6 months later, when we iterated Yipit into a daily deal aggregator, we learned to ignore the excuses and released a prototype in 3 days that took off right away.

Below are the excuses we had and how we realized they didn’t matter:

  • It wasn’t good enough yet. We thought manually sending deals wasn’t good enough. We were guessing and didn’t really know. It turned out that six months later, the automated version full of features wasn’t good enough either. We could have learned why it wasn’t good enough 6 months earlier and spent that time actually trying to fix it. Instead, we just guessed why it wasn’t going to work and guessed wrong.
  • We didn’t want to give a bad impression to those early test users. I can safely say that this doesn’t matter. Those early test users just don’t care. After we re-launched as a daily deal aggregator, we got exactly one email from a user saying they missed the sample sales. That’s it. In fact, many of those early users enjoyed seeing our product develop.
  • It needed these extra features. We thought we had to have a web view, people had to specify where in the city they lived, it needed to have links to the source of where we found the deal. None of these were right. We were guessing. Had we launched in a week, we would have quickly realized these features weren’t going to make a difference.
  • It was going to take us a few months to build the tech back-end. We shouldn’t have built it. We should have just used MailChimp to send the emails. For the next iteration of Yipit, we didn’t build the back-end. Users don’t know what your tech back-end looks like. Focus instead on getting the user experience right.
  • It needed to scale to accomodate hundreds of thousands of users. No, it didn’t. We weren’t going to get hundreds of thousands of users. Not anytime soon. We should have just been worrying about getting our first 1,000 users.
  • Someone will see what we’re doing and copy it. If our idea had any merit, then there would have been at least 10 other groups of people out there also actively working on it. In fact, there were many groups of people working on a daily deal aggregator. But, because we launched in 3 days, we were the first ones and got most of the press attention.
  • A potential investor will see it. I’m not sure if an investor actually did see it. But, even if they had, it’s not a bad thing. Investors like to see the progress you make as a product and as a team.
  • TechCrunch will write about us when we’re not ready. They won’t. We spent a bunch of time trying to get people to write about us and they didn’t. Also, in some crazy scenario where someone writes about our terrible prototype, I can safely say it won’t matter in the long run. Startups succeed because they have a good product and not because they got good launch PR.

The Excuse I Didn’t Admit

There’s one more excuse I had but didn’t talk about. I was afraid it wouldn’t work.

I had quit my job. I had told my family and friends about the idea and they’re all telling me how much they believed in me. What if the idea is bad? What if I had to tell them it didn’t work? What if I had to admit failure?

You have to fight this feeling. The best way I’ve come up with is to think of a startup as an experiment, not as a business. Your early experiments are supposed to go wrong. Your goal is to find out what went wrong and iterate.


For those of you that don’t have an amazing excuse (like you will be put in jail if you do this), please launch an early prototype. Not waiting to launch is, by far, the best advice I can give. Hopefully you’ll listen more than we did.

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

Hustling from our shared workspace cubicles

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

“So, what do you do?”

Ugh. I hated that question.

The truth was that we were trying to start a new venture but we hadn’t really made any progress.

But, instead of just muttering something, I would force myself to enthusiastically pitch our current struggling idea. They would nod along but the skepticism on their face was hard to ignore.

And, when I was done, they would sometimes hit me with: “So, is that your full-time thing?” Ugh. What that really meant was: you’re trying to tell me that you spend all your time working on that ridiculous idea?

The Grind

We left our finance jobs in the summer of 2007, and we worked really, really hard. By February of 2010, it had been over two and half years of hustling on no salary. What did we have to show for it? Nothing.

We hadn’t made a dollar of revenue. We had been rejected by every investor we talked to. We hadn’t been able to recruit anyone to join our team. We hadn’t gotten traction with any of our ideas.

We had failed to get more than 10K monthly unique visitors for Yipit for the last two years despite trying several ideas with it. We were going sideways:

On a personal level, my life savings was disappearing. I kept getting hit with late penalties on my credit card. Not because I didn’t have the cash to pay it, but because I just didn’t want to think about it. It was too depressing to look at my depleting bank account that I had worked so hard to build up. I remember withdrawing all the money from my 401K account and having to confirm that I did, in fact, understand the massive penalties I would incur for doing so.

In all honesty, I probably would have given up earlier. The only reason why I didn’t was out of loyalty to my co-founder, Jim, who had also quit his finance job. He had passed up many amazing job opportunities to work alongside me and I wasn’t going to quit on him.

Everything Changes

So, it’s now February of 2010, over two and half years since we started, and we have yet another idea: build an aggregator for the early but quickly growing daily deal industry. The idea was sound, timely and right up our alley since we had been doing local deal aggregation for the last 9 months.

And, in just three days, everything changed.

We launched the new idea in a three-day scramble, got some initial press, users loved it, and four months later raised $1 million from amazing investors. A year after that, we’ve raised $6 million, made real revenue, attracted hundreds of thousands of users, and recruited amazing people to join our team (we’re hiring! join us!). And, best of all, we’re just getting started.

So, what happened in those three days?

I’m convinced that if we had the idea for a daily deal aggregator back in 2007 or 2008 or even 2009, we wouldn’t have gotten traction because we would have messed it up.

But, after two and half years of failing and learning, we knew exactly what to do:

Now that I look back, I realize that I was wrong to think that we had nothing to show for two and half years of hustling. While we didn’t have outward signs of success, we had learned something very important: the art and science of starting a new venture. It took us almost three years to know what exactly we had to do during those three days.

And, so, to everyone out there who’s struggling and feels like they have nothing to show for it, I hope this post keeps you going. You’re learning every day. And, when the inspiration strikes, you’re going to be ready to pounce on it.

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

Back in November of 2006, before NY Mag and TimeOut put startups on the cover, before the “tech bubble”, before Twitter and Foursquare were popular, before working at a startup in NY was considered a reasonable thing to do, I was a private equity investor for a $1.6 billion fund called Quadrangle Group.

It was just my third year out of college and I made a little over $250,000. For a Brazilian immigrant who spent most of his childhood kind of worried he would have to do physical labor, I felt like I had really made it. My job was challenging (making investing decisions always is) and I worked with some really smart and motivated people.

But, beyond “making it”, I was comfortable. After a year of private equity investing, I felt like I was good enough to do it for the long haul. While I’m sure there would be a few unexpected twists and turns, I sort of knew what the next 20 years of my life were going to be like and it looked pretty good.

There was only one little issue. It turned out that I didn’t really love money.

After 18 years, my mom had successfully passed along an immigrant guilt towards buying anything lavish for myself. So, my expenses weren’t really growing in proportion to my income. And, at least for me, I didn’t see money as a metric of success the same way Warren Buffet does. When it’s all said and done, I didn’t want to be measured by how much money I had accumulated but by what I had built.

But, when you’re making more money than you know what to do with, you tend to procrastinate on any big decisions. Well, at least until you’re reminded of what else is possible.

How I Woke Up

My company, Quadrangle, organized a private conference every year for the media and telecom industry. This was not just another conference, it was ridiculous.

I realized how ridiculous it was when I got an email with the list of attendees. Every major media company executive was coming. Brian Roberts from Comcast, Steve Ballmer from Microsoft, Jeff Zucker from NBC and media celebrities like Katie Couric, Jerry Seinfeld and Harvey Weinstein. While journalists weren’t allowed to cover the conference, Andrew Ross Sorkin, of the NY Times, was given permissions to write-up a quick blurb about the conference.

I was really excited and had barely slept the night before. The dress code was business formal and I walked into the Pierre Hotel wearing my best suit and power red tie.

I soaked in the scene for a few seconds trying to find the first person I was going to talk to. And, then, it hit me. Why would they want to talk to me? They were the heads of major media companies, I was a 25 year-old finance guy. They didn’t want to talk to me, they wanted to avoid me. I wasn’t doing anything important, anything that could impact their companies. They didn’t care about my suit or my power red tie.

So, for the next 30 minutes, I just awkwardly walked around the room trying to listen in on the conversations people were having. When the panels started, I took a lonely seat in the back.

After listening to a few panels comprised of 50+ year-old media executives, the audience was looking forward to the fresh perspective of the next panel on new media.

The two guests were in their 20’s. I almost couldn’t believe that two people roughly my age had been invited to talk in front of all of these important people. And then, even more shocking, they had all of their undivided attention. All of the 50+ year-old media executives were mesmerized, excited and scared of what they had built and what it meant for them. One was Chad Hurley, fresh off his recent sale of YouTube to Google, and the other, wearing sandals, was a still unknown pre-“The Social Network” Mark Zuckerberg.

When the panel ended, media executives came up to them to talk about working together, get advice on their business. I just stood in the background watching.

I was floored.

They were building something. They were changing how the world communicated. And, they had done it in just a few years without raising significant capital to get started. They willed their services into existence.

What was I doing? Could I do what they had done? Could I build something as significant as they had?

Yeah, right.

I had never built a tech startup. I had never even built a website. What did I know about product management, web development, and user interfaces?

I had a high-paying finance job. I was on my way. It was too late. I had no idea what it meant to start a company and the most likely outcome was failure.

On an expected value basis, the obvious decision was to stick with finance.

I was where I should be.

But, as the days went by, I kept thinking back to the conference. A scary idea started creeping into my thoughts: what if I could build something? Wouldn’t I always wonder? Wouldn’t I regret it? Wouldn’t it eat away at me over the years?

And, that’s when I realized that I didn’t actually know if I was good enough because I hadn’t really failed in life (at least not professionally). Most people don’t really fail. We tend to take the job that we think we’ll succeed in. We are hesitant to reach. And, if we do reach and succeed, then we don’t reach again.

The only way to know how good you might be at something is to fail trying it.

And, that’s when I decided it was time to test my limits. It was time to really reach. It was time to quit my safe job and walk straight into almost certain startup failure.

I had no idea how to start a successful tech company, but I was going to try. I was going to step into that arena. And, whether or not I triumphed or got knocked down, I didn’t really care much. I wanted to know the bounds of my abilities.

So, What Happened?

It’s now 4 years since I left Quadrangle. Did I fail? Hell, yes. I got knocked down many, many times. For the first 2 years, I had no idea what I was doing and was just swinging blindly. But, every time I fell, I learned why.

After two and a half years of failure, we launched the third version of Yipit and it took off. We’ve now raised funding twice including the most recent $6 million round this summer. Yipit is growing, we have a strong vision of where we’re going and we’re building an amazing team (join us!).

But, perhaps, one of the sweetest moments was that I was invited to the latest Quadrangle conference. Not as a panel speaker, we’re nowhere near that. But, as part of a session where three startups pitch Barry Diller for 3 minutes and then he grills you with questions in front of the entire audience of media executives. It was clearly terrifying but it went well. At the end of the session, Barry picks the startup he thinks is most like to succeed and he picked Yipit.

When I stepped off the stage, still kind of shaking from the presentation, media executives came up to me talk about what we were working on and how we might be able to work together. I couldn’t believe they were coming to me (and I wasn’t even wearing my power red tie).

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

Yipit Looking for Experienced Sys. Admin Consultant

January 15, 2009 | Comments Off on Yipit Looking for Experienced Sys. Admin Consultant | yipit

Yipit is looking for help from an experienced system architect / server admin / web developer. The work will be on a consultant / freelance basis where we pay an hourly rate. We need you to be in / around New York and to come to our offices (Midtown East or, more affectionately, Turtle Bay).

This is perfect for someone who has some extra time on their hands or is looking to make some extra money and wants to help a young, excited start-up team in New York.

What we can do for you?

  • Pay you real money
  • Pay you on an hourly basis
  • Give you flexible work times
  • Be fun, smart and motivated people to work with

What do we need help doing?

  • Setting up a site to run on Amazon’s Web Services (EC2, S3, SimpleDB)
  • Setting up development, testing and production environments
  • Setting up the environments to be able to run Python / Django
  • Setting up a dependable back-up system for our code and data
  • Helping us think through scalability issues in terms of database design and server architecture

We are looking for a smart individual to help us do this in person and to teach / explain what he/she is doing. We are quick, attentive learners and promise not to be annoying.

Who are we?

I keep saying we because I’m speaking on behalf of the Yipit team but you will be only working with me. My name is Vinicius Vacanti and I’m a co-founder of, a new New York local search engine. Our prototype is live and we have been very encouraged by its performance so far. Consequently, we are currently gearing up to release a city-wide version in 2009.

For more information about Yipit, please visit Yipit or the Yipit Blog.

For more information about me, please visit my blog, my linkedin profile or my twitter account.


Please let us know what you would like your hourly rate to be. We would like you to get paid whatever amount makes you think the job is a worthwhile expenditure of your time.

If you are interested or know someone who might be, we would love to talk to you. Please comment below or email me at vin at yipit dot com

Not that you need to be bribed, but if you suggest the person we end up choosing, we would love to buy you lunch at Shake Shack (or other lunch place of your choice) to express our gratitude. If you are the candidate and contact us directly, we would be happy to buy you lunch.