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Executive brief: Google buys Slide

Want to know more about Max Levchin, CEO of Slide, which Google just picked up for $228 mln?

Financial trends and news by Bambi Francisco Roizen
August 6, 2010
Short URL: http://vator.tv/n/10f8

He made throwing sheep a rage on Facebook, now what kind of social behavior will he encourage now that he's at Google?

Congratulations to Max Levchin, founder and CEO of Slide, a maker of photo slideshows and social apps and widgets.

After raising some $78 million in venture financing since launching in 2005, the San Francisco-based Slide was sold to Google. Both companies confirmed the sale, which was widely reported in previous days. Reports peg the transaction at $228 million, with Max making $39 million from the sale. Google, which recently took a $100 million stake in Zynga, is apparently buying Slide to glue together its own social gaming/app strategy. 

"As the Slide team joins Google, we’ll be investing even more to make Google services socially aware and expand these capabilities for our users across the web," wrote Google engineering director David Glazer, on Google's blog. For his part, Max wrote that both companies are committed to "change the way people socialize on the Web."

While Zynga, which started in 2008, certainly showed the world how to make money as an app or social layer on top of Facebook, it was Slide that was an early pioneer, showing engineers that Facebook was the new desktop. Kudos to Max and the Slide team for showing us how people wanted to socialize on social networks - mainly through the act of sheep throwing. Who knew?

There are a lot of articles written about Max, and what his vision was for Slide in the early-and-mid years of Slide's existence. On Vator, we focused on capturing the video. Here's a look at our video interviews with him during the time Slide came into prominence for being one of the hottest social apps on Facebook, including our latest post on the sale. Just click on the hyperlinked titles below to get to the videos. You'll glean a lot about Max's philosophy on sharing and engaging. It's highly probable he'll take the same approach and thinking to Google.

Google buys Slide for up to $228 million

Slide was founded by former PayPal CTO and co-founder Max Levchin, who said he would consider it an abject failure if Slide went for less than the $1.5 billion that PayPal raked in. By his own standards, Google’s acquisition of Slide for  the $228 million that Business Insider reports doesn’t come close to his benchmark. And it is a step down from the $500 million valuation it got from a $50 million investment from T Rowe Price and Fidelity Investments in January of 2008. Given the $78 million Slide took in venture investment, it’s true that this exit is no grandslam. BUT for an outside observer $228 million is an insane amount of money for a widget company and an amount that is not something to sneeze at.

Slide's Max Levchin on making money in social media

In early 2008 (the time of this interview), Slide, with 170 million monthly unique visitors, had just raised $50 million for a valuation of half-a-billion. Zynga was barely known, and Slide was among the leading "widget" or app companies running atop Facebook and creating buzz. You can learn from this interview that Max and Slide were focused on "self-expression" as the form of entertainment with their "SuperPoke" feature all the rage. Slide's goal was to continue to create "social mechanisms" that made "people share what they love." At this time, the idea of making money through virtual goods was not even brought up, though virtual goods monetization had already proven to be a successful form of monetization in Asia. Advertising was the "obvious" way to make money for Max. 

Max Levchin's philosophy on enagement

In this interview, Max and I focused specifically on the Slide product and how he saw it evolving to sustain or capture more users, and ultimately advertisers, which was Slide's predominant source of revenue. At the time, Max said in some ways, Slide was delivering a more social "Hallmark" card, through SuperPokes - a feature where a user could send virtual gestures of poking, kicking, slapping, etc. It was an easy form of communicating without lifting a finger... well, maybe just tapping a finger. Slide was also enabling people to share stuff from around the Web. These were engaging enough at the time. And, Max wanted to make his products more engaging by ensuring that there were shared experiences created that people couldn't walk away from. This was true then as it is now.

Levchin's lessons: Change is the key to success

Slide founder and CEO Max Levchin says "the trick to succeeding in a startup is to figure out what doesn't work... and change... The key thing for Slide was figuring out that the desktop was not outside the browser, but inside the browser." The company itself has to change, as well as the people within it, says Levchin, one of the co-founders of PayPal, the electronics payment company that was sold to eBay for $1.5 billion.  The concept is "as boring as it is important," he says. In the early days of PayPal, he wanted to go outside the company to hire a senior engineering manager, but had no success finding the right person. Ultimately, he let the engineers "self-organize under natural leaders" and the operation flourished.


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Thumb_2644_slide-pitch
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Description: Slide is the largest personal media network in the world, reaching 144 million unique global viewers each month and more than 30 percent...

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