Month: December 2008

LEWEB INTERVIEW — Dec ’08 — Marc has created the number 1 dating site in Europe called Meetic and its interesting in many, many aspects. Meetic is present in 22 countries?

Marc:  Yes 22 or something like that. I don’t know exactly.

So anyway Marc is a huge European success and we never hear about Meetic generally. We will open to questions and this is the last session of the day.  I’m happy that you’re still here because with Marc it took me 4 years to get him here and if you weren’t staying he would never show up anymore.

Marc, tell me about Meetic and when did you start?

Marc: I started the company in the beginning of 2002 and the website was launched in July. So that was 6 years ago.

So that was in the crisis, we were still in the depression and if I remember well no one wanted to invest.

Marc:  Of course. I sold my previous company for 200 million Euros.

How much?

Marc:  200 million Euros.

200 million Euros?

Marc: Yes and then I decided to start a new website and I preferred to do that with investor money and no one accepted to invest in my company because they said it would never work as usual in France. Then I tried to raise funds, which is not possible so I decided to invest half a million dollars…

So you failed in raising funds?

Marc: I failed completely. I failed to raise funds; I failed to find the money for an office. And you know bankers are bankers and the guy told me, I thought it was 50,000 Euros, and the banker told me if you want 50,000 Euros you have to put 50,000 Euros on the escrow account. And I said this guy is brilliant and he’s still there probably. So I funded my own offices and decided to run Meetic with half a million dollars.

So you have 5 criteria’s, you should really listen to this, Marc has a few criteria, so what are you different criteria?

Marc: I know I’ve known him for 6 years and every few months he asks me the criteria I have to found Meetic. So I took a piece of paper and wrote them down. So the first one is you don’t have to pay for content. The second one is you have to have a subscription model because I hate revenues coming from (inaudible 4:16) because it’s up and down, up and down.

We’ll come back to that.

Marc: The third one is its self controlled, so the community controls the websites. So you have control for free. So free content, free control, free subscriptions. The next one is you have to be able to localize the website easily. If you make a content website, if you make a local website you still have adapt the website for each country. Dating is dating and love is love and it works everywhere.

The next one is I wanted to have a chance to be a leader in Europe. So I didn’t try to launch as an EBay competitor even if I had the idea because I didn’t have any chance to be the leading website in Europe. Then the last one is to create daily, day after day, (5:15 inaudible). So there is a network effect as you know on dating websites so if you’re pretty big then no one can compete against you because day after day you’re bigger and bigger. So every day you create a barrier which is bigger than the day before.

And the last criteria before choosing to launch a website is you have to love to do that. And I love to help people find love.  So it was the last criteria…

Passion?

Marc: Yes. So Meetic matched with those criteria’s and that’s why I decided to launch it.

So you had 6 criteria or whatever and you were matching businesses. So if you go against those criteria with most web companies most of them don’t pass the test.

Marc:  As a main criteria if you run a 1.0 to 2.0 business, the difference is the 1.0 you don’t have to explain what for.

It just works?

Marc: 2.0 you have to explain why do I want to use this website? If you want to publish, if you want to share what for? The 1.0 business everybody know how it works and what for you use it.

So you’re doing 140 million Euros in revenues?

Marc:  Yes.

You are a public company?

Marc: We are public so it’s prohibited for me to disclose a lot of figures but in 6 years we charged a half a billion dollars to our users on a community basis.

So you have to explain something, dating is like there are tons of services competing with Meetic in the US and Europe which are free. And if you had told me like, Pablo (last name) was explaining like you should share with everything for free and Meetic could have been killed by everything for free. Why not? How much is it? 30 Euros to date someone?

Marc: Yeah it’s 30 Euros per month. So why can I compete against free websites? I will give you a very clear answer. If you can choose to go and dance at the most expensive nightclub in New York and the free nightclub, which one would you choose? Probably the paying one.

I don’t know.

Marc:  You don’t know? I will do.

You would go to a paying one?

Marc:  Yeah.

Why?

Marc: Because the people are more involved, the people are more serious, it’s controlled. You can pay guys for the security which is not the case on the free website. So in the end if I pay on a website it means I’m involved to find somebody and the people love that.

And the second criteria is security. Each time you receive a message on Meetic  we have the credit card number of the guy or the girl and so if there are any problems we know who is who and it’s not anonymous. Even if it is anonymous because nobody knows you on Meetic…

Nobody knows me on Meetic, how much on hot or not because I want to learn all this virtual good stuff and they have all these virtual flowers and today I hope you like the virtual goods presentation but they even have the flowers die after 2 weeks. So it’s interesting and it’s free.

Marc:  Its free yes.

You don’t have any virtual goods?

Marc: No. for now because it doesn’t work. They don’t have to give flowers to chat with somebody else. So the business model of dating is quite special because it’s still growing. I told you we charge half a billion in 6 years and we are making 15%.

So you are profitable?

Marc:  More than that in profit but we’re still growing.

How much in profit?

Marc:  A lot.

That is really impressive because you would really think that a business like this, so how did you get it started? Did you invest a lot in advertising? You launched free and the reason being to get the initial community and get the buzz right so that it grows virally. So if you do something paying immediately it’s tough because it doesn’t grow right?

Marc: You have to have at least a few users before starting to charge. So we decided to launch the website for free for 2 months and then we started to charge.

2 months?

Marc: 2 months and that was enough. We had 3,000 users. So we decided to charge the website in the very early stages. And what was the question?

The other question was how can you make people like pay early? 2 months is nothing and so many companies are like afraid of charging.

Marc: The idea was
to have enough users in Paris in a very short time and especially female. So we decided to open the website for free for women and when you have 50,000 French women to chat with on a website it works. So immediately we were able to charge the guys and the system started like that.

So tell me a cool story about couples you created. What is cool? In 6 years, you must have a very, very cool story.

Marc: The first one is the press made an article on myself and the title was, The Guy Who Has 60,000 Babies. So I’m supposed to have made 60,000 babies in France and so we have a lot of very funny stories or very sad, sometimes they are not good stories. But my favorite one, I have two.

The first one was we received a phone call from a woman and she was very angry. She told me it’s unbelievable my husband is on Meetic. I said shit I’m sorry about that. She said we were just divorced yesterday. I said well if you’re divorced I don’t see any problem if your husband is on Meetic today. She said yeah it’s not acceptable. I said how do you know he’s on Meetic? She told me I’m on it.

So they found themselves again.

Marc:  No not this one.

They dated again?

Marc: They dated again and now maybe they are still together. The second one is I received a very long letter from a guy who thanked me because he fell in love on Meetic. So he told me I’m so happy, thank you and without you I didn’t have any chance, etc. Then at the end he told me I’m sad because I have to leave Meetic and I know you will lose a customer. So you lose money but you understand I have to cancel my subscription. And he signed the letter and made a PS, I will resubscribe later if necessary. And that is exactly the business model of Meetic.

But you lose repeat business right?

Marc: My US friends at Match.com may assume and they told me the duration of a love story is 18 months.

Do you have any number of how many couples have been generated on Meetic?

Marc:  Probably in Europe half a million.

How many have you destroyed? Like from somebody cheating on Meetic.

Marc: Probably half a million too. No, no that’s a joke. So we receive letters to thank us because the guy and girl are divorced.

To thank you because you created a divorce?

Marc: Yes because the women say thank you because my husband was crap and now thanks to Meetic my husband is nice. So I say okay why not. But we have more love stories then divorce.  I hope.

So very interesting and you are in 30 plus countries despite you’re French.

Marc:  Yes.

And how do you see the launch in 30 countries? You have 30 countries here in the room, how was that difficult? Like what was the easiest country?

Marc: All countries were complicated because I’m half Italian and I thought launching Meetic in Italy would be simple and it was fairly complicated.

Why?

Marc: Because there was too sensory of difference between French and in Italian when we talk about love.

You have to explain that. Do we have any Italians left in the room? Yes so you have to explain.

Marc: So I’m sure Italian girls are afraid of saying I’m on Meetic. Because if you’re an Italian girl and you want to date you have to ask your brother.

Really?

Marc:  That may not be totally correct but its close.

Do you confirm? Yeah she confirms.

Marc: So we’ve made a very funny advertisement in France where the girls make the first kisses to guys and it was very funny in France and everybody loved it and we launched it in Italy and it was a disaster. They are saying who are those girls, they’re not Italian? And I say yes and it doesn’t work. And Spain was complicated too.

You would think the Latin countries would understand.

Marc:  No every country is different.

So tell me about dating in different countries that seems very interesting.

Marc: In the UK everybody told me you don’t have any chance in the UK. So I say okay as usual I don’t have any chance but I’ll try. So we bought the leading website in the UK and the difference is there are more women than men in the UK. That is the only country in the world where you have more women than men on a website. I don’t know why. Yes, I know because of the English guys but…

Do we have any Brits in the room?

Marc: No that’s a joke. And the last one, the most complicated one was Germany. Every friend of mine told me you will never succeed in Germany as usual.

So when anyone tells you that you’ll never succeed you just go straight…

Marc: As usual and we bought a website in Germany and it works very well. Honestly the German guys are completely different.

How do they date the Germans? Germans raise your hands.

Marc:  How do the Germans date? If I had to say in a word is seriously.

So they date seriously?

Marc:  Seriously.

What do you mean they go for as many possibilities as there are?

Marc: The Germans are serious. Nobody knows German guys? They are very serious, majorly organized, polite. So it doesn’t work in Germany to date the French way it’s very complicated for them.

Is there any country where it didn’t work very well?

Marc:  In Sweden because we made a huge mistake to provide the website for free for women. And the women were very angry about that and asked why is it free for women? I say because you’re women and they said so what? So I’m sorry I didn’t know and so now the Swedish women pay on Meetic.

So get ready for a few questions.

Marc: That is why it is so complicated in all the countries all over Europe because everybody is different.  And everybody will tell you that you don’t have any chance, so that is complicated in Europe.

So you have a 140 million in revenues and a profitable company. You could have sold this like 10 times right to Americans? Like one of the sad things about Europe like most internet successes are sold to American companies. My point is how do we maximize this more in Europe? How do we have more of you?

Marc: If we continue to keep the same education system in France we should have not have a lot of guys with diplomas because I don’t have any diploma. So I had to find a way to create my own job. In fact, I didn’t have any diploma so I had to create my company if I wanted a salary. So if we continue to have such a poor system of education, we will probably make a lot of guys without any diplomas in France and then that may be a chance because everybody will have to create a company to survive.

If you were not doing Meetic what would you be doing?

Marc: I will give you a surprise. In 6 years everybody has asked me why did you launch Meetic? And I say because I have friends who wanted to find love. And I had in mind to launch this business but I didn’t decide to launch it. And one day a guy wrote this article in the paper. Does anybody know (20:13 name) it was 6 years ago so maybe the guy is dead but maybe he’s still alive. And this guy wrote an article about me and he explained that I sold my company for 200 million Euros and he said now this guy wants to launch a new business and decided
to invest 100 million Euros to launch Meetic. And I translate the last sentence, a company which will probably never be evaluated at 200 million Euros.

So Meetic was not launched and the journalist said this guy will create a company which will never be evaluated to 200 million Euros.

So he was announcing your failure?

Marc: Yes and he was right, Meetic was never evaluated to 200 million Euros but instead 400 million. I said how could you, I just launched a business, I sell it, I have a new idea and I launched the business and the French guys say you will never succeed, as usual. And I said I will do it for him. So thanks Remi (last name), I don’t know if you’re still alive but thank you.

Yeah so you don’t like the press too much right?

Marc:  Not really.

Is this why you don’t like to…this is hurting you Marc honestly. When you have someone telling you in a full page this is going to fail anyway.

Marc: Yeah it gives you a lot of energy just to show him. You know this guy could be an editor by now so I have to be careful about it.

So there is a famous quote of Marc’s that I have to give to the room because it’s been all around the internet. Marc said a few years ago now during the Presidential campaign, someone was asking Marc are you right wing or left wing and I’m not getting into politics I promise but someone asked Marc are you a right wing or a left wing? And what Marc answered was, “Staying in France is being left wing.”

Marc:  Yeah it was a mistake and I’m sorry about that. I paid and I pay so many taxes in France for poor help from the French government and I fight against so many rules and laws.

So explain, like we have the Minister of Economy coming tomorrow. How many tax controls have you got?

Marc: As usual I have probably 10. And the French secret is sometimes I had 2 at the same time.  It’s not…

Tell me the story about the Christmas tree.

Marc: Do you have time? It’s in English so it’s complicated. So we decided to make a Christmas tree. We had say 10 babies in the company we bought 10 gifts just to give the babies. Six months later I had a control and the controller…

Tax control?

Marc: Tax control and the controller asked us why did you buy 10 gifts. I said because we have 10 babies. And the guy asked me to give proof that you have 10 babies. I said to the controller okay I will do that but you have to write it on the letter. I will pay 1 million Euros on advertising and all the French press and I will copy them with the letter and then you will receive my answer. And I didn’t have any controller any more.

So if you want to avoid tax control in France the best way is to tell them you’ll advertise them.

Marc:  But if you launch a business in France and succeed you will success everywhere.

Just one more question Marc before we open for questions. Marc, why are you still here?

Marc:  Because I’m French.

You know the French can also move.

Marc: Meetic’s headquarters is in France, I have a house in France and I love France and wine so I will stay there even if I have to give most of my money to the French taxes.

All right first question and I hope you’re having as much fun as I am.

Francois: Hi my name is Francois and thank you very much for this funny talk. My question is regarding the talk we had from Helen Fisher that gave us the talk about love. Were you interested? And do you have a clue to put them in Meetic so it would be more efficient?

Marc: I know Helen Fisher because I saw her on a TV show a few years ago and I was very interested in what she said. We’ve launched this kind of website in Europe and it’s called Matchmaking, so you have to take a very complete test and we match a lot of criteria, psychology criteria’s and we ask psychologists to make a test for us. So the website is already launched in Europe for few months. It’s called Meetic Affinity and without saying any secret, in France it’s the second largest website in terms of revenue just behind Meetic.

Can I translate you? Your English is fine but I translate Marc. It’s like big time and you’re bigger right?

Marc: Yeah. So we decided to launch such a website and I would be very interested to chat with Helen Fisher even if it’s difficult to test. I will do my best and it will be very interesting to meet her.

Right as long as you make much more money with your service then the one from Match.com. Pay attention to the fact that not only does he not sell to a US company but he actually competes and beats them to the territory.  Is there another question?

Kristina: I just want to know from France how did you organize your international developments. You said it’s really difficult to have a company in France and be present.

Marc: It was probably the most complicated challenge. The biggest thing was I decided to concentrate everything in France, to translate everything from France, to operate in France, to put only one guy in each country just for the marketing and partnerships and it works. It worked for 3 years. But at the end if you want to improve your business you have to act local. And then slowly we moved a lot of things from Paris to other countries that we started by the marketing and then the branding and the customer care and now everything is localized very deeply country by country.  But at the end we are more efficient country by country and so it’s a long process from the beginning to the end. But if you want to be local from scratch just in the beginning you can’t be global in Europe. You have to start very light and then add local later. But never start with a lot of subsidiaries everywhere because it’s a mess.

Daniel: Marc, I’m Italian, I live in Paris and work in London and my wife is Japanese. My question is beyond differences what can you see as similarities across Europe or areas of leverage whether its brand, technology, expertise that you have noticed that you can replicate or leverage from country to country?

Marc: There was a lot of difference country by country but there is one common point, which is if you want to have a chance to grow in all markets you enter you will need to have a brand in each country.  Without a brand you can’t grow. So we spent 200 million Euros on advertising since the launch of Meetic to create a brand everywhere. So everything is different, all the parameters are completely different market by market but the only thing you have to have everywhere is a brand. So you have to build or you have to buy or you have to create but without a brand there is no chance. So we spend a lot of money to create our brands.

I’ll give you an example, in France Meetic achieved 92% of brand awareness on the French population so we are unbeatable. It’s not possible to compete against Meetic. So the brand is probably the most important and most expensive and the most key thing you have to build for a chance in Europe.

Marc I would really like to thank you for your time here and I hope you come back within the next 5 years.