With the vision to provide groups a free, easy and fast way to communicate with group members via SMS, Derek Johnson founded Tatango.com in 2007. Initially started as a way for his Fraternity to communicate with his Fraternity brothers, Tatango.com has grown to the leader in it’s industry.
As CEO, Derek is primarily focused on how to best translate user needs into a great service while directing Tatango.com in their strategic direction.
A 24-year-old dropout of the University of Houston Entrepreneurial program, Derek has raised half a million dollars in investments for the company from private investors and the Bellingham Angel Group.
Tatango.com has done over 35 million messages since their launch and services all types of groups such as College organizations, churches, athletic teams, political candidates and non-profit groups.
As any entrepreneur will tell you, launching a company is hard work. Derek, a self proclaimed workaholic puts in 100+ hour workweeks to fulfill his vision of Tatango.com.
Derek and the Tatango.com team have been featured in the Wall Street Journal, Seattle Times, Mashable, TechCrunch, PC World, LifeHacker and other national publications.
How did Tatango came about? The name?
I was having lunch with a friend, a sorority member, who was complaining about how difficult it was to communicate to everyone in the sorority about meeting times, event locations, etc. and nothing was working. I then told her she should find something that made it simple to communicate with large groups of people via text message. I went to online and couldn't find anything that groups such as sorority's could use. This is when I got the idea to create a website that made it simple for groups of all sizes to send out mass texts to all their members.
We spent hours brainstorming trying to come up with a name, and then one night "Tatango" just came to one of our employees over dinner.
When did you start the business? Why start a business? What inspired you to start one?
I started the business toward the end of 2007. I have always been interested in entrepreneurship and starting my own businesses. It is my belief that you are born with an entrepreneurial mindset, or you aren't. You could say I was bit by the entrepreneurial bug. My father has inspired me greatly, because he is such a hard worker and a brilliant entrepreneur.
Quickly give us some background information about yourself?
I was born in New York, but I have spent the majority of my life here in Bellingham. I am a notorious workaholic. I come into the work at 9am and from there it is a different day every day, mostly filled with emails, phone calls, brainstorming, investor meetings, team meetings while constantly updating our twitter status. You can check us out at twitter.com/Tatango. It's different everyday I walk into our office, and that is why I like my job so much.
Can you tell the readers what exactly your business does?
It is a service to connect members of a group via text message. You can send one text message and that one message gets sent to everyone in the group. It is simple to use for groups of all sizes, and we have filled a void in the market that no other website has been able to fill.
When did you encounter your first entrepreneurial experience?
I started out selling candy bars on the playground at recess at 8, and then started my own landscaping business.
What were you doing before this?
I was attending the University of Washington, but then I was denied from the business school. I took some time off and transferred to the University of Houston to study entrepreneurship. I came up with the idea for Tatango after about a year, and then decided to drop school and focus on my idea.
How has the journey been so far?
It has been amazing. Any company that is successful in my mind is one that has a service or product that can supply a need in the market that isn’t being filled. I believe Tatango is very successful for the sole reason that we filled a void in the market that no other website was able to filled.
There are two groups of people that are responsible for the company’s achievements. The first group is the people that work here at Tatango, Our team members kick ass everyday and deserve way more credit then they get.
The second group responsible for the company’s achievements is our users. We have extremely loyal, and vocal users and they have become our biggest marketing tool as they tell others about their positive experience with Tatango.
What’s your business model?
The business model is a three-tier business model. One is advertising--which is placed at the bottom of each message.
Those ads are for ringtone companies, movie theaters, or just general products. The second is we have a subscription model. For $4.95 a month, you can upgrade to a Tatango pro account which allows you to remove the Tatango branding from your text messages. The third is that you can add additional features to your account, such as keywords and additional groups.
How did you finance your company?
I was 22 when I initially started looking for funding to get my idea off the ground, but quickly realized that at my age it was going to be difficult. Banks wouldn't touch us, and Angels Organizations said that we didn't have enough experience.
This left us with friends and family who believed in us and our idea to pitch to. After one month and about 20 presentations in my basement, we had raised our initial seed money.
Once we knew we had something, we needed additional capital so we submitted applications to 6 or 7 Angels Organizations. Every Angel Organization we applied to rejected us, but we took their comments and feedback to heart and re-applied. A few months later we were accepted to present to the Bellingham Angels and raised our second round of capital through their organization.
Who are your main competitors? How do you compete against them?
Currently Tatango is the largest group texting business and to be honest we don't pay much attention to competitors. We want to make the best website for our users. If you focus to much on competition, sometimes you loose focus on creating the best service for your customers.
Running a business at such a young age , how does it feel?
It's crazy, but I love my job everyday. To be honest, when things get crazy, frustrating, or just near impossible, I never think about giving up.
For me, those are the fun days! When do you get to test your skills and determination more than at those points in your business career? Those are the sort of obstacles that make what I do such a challenge and so rewarding.
How vital is Teamwork when starting a business?
We have created the dream team at our company and daily I’m amazed at their hustle and commitment to the company. In the marketing and business development department, we have Andrew Dumont who is constantly adding new users to the Tatango world. On the website side, we have two of the hottest young engineers, Adrian Pike and Amiel Martin, who are constantly working crazy hours to keep up with our growth.
These guys are machines really, releasing new features faster than other companies with at least three times as many resources as we have. Alex Mittelstaedt is our community manager, and has played a very important role in creating a strong support base here at Tatango. Our graphic designer, Nathan Carnes, is devoted to perfecting Tatango's interface. Hands down, we owe the majority of our success to our team members.
On another note, I am a firm believer of not wasting time in getting rid of employees that aren’t working out. I have found it easy to find employees that have the needed skill set to get a job done, the real challenge for us is to find employees that fit within the culture of the company. This is key to anyone that wants to build up a business. By being extremely picky and focused in hiring, we have been able to find the perfect team members.
Do you have any role model/influence/mentor?
My Father. He has both experiences working for large national companies and owning his own start-ups, so his knowledge and experience has always been a great resource for me. He is both a brilliant entrepreneur and one of the hardest workers I know. He has inspired me in many ways to become a young entrepreneuer.
What advices would you give to young entrepreneurs starting their business, especially during this time of economic downtime?
1.Start Small – Start small and you will be able to quickly see if you have something interesting before you look to expand.
2.Don’t Re-Invent The Wheel – No matter what problem you are experiencing or challenge you have in front of you, you aren’t the first person to ever go through it. Seek out advice or guidance from someone that has gone through the same thing you are going through, this will save you from making a lot of costly mistakes in the future.
3.Be Available – I’m the only Internet CEO I know who makes himself as available to his users as I am. The majority of our users know my personal cell phone number (206.334.4012 if they have forgot it) and they know that if they ever have a suggestion or any feedback about our website, they are able to get a hold of me. I think communicating with your users is extremely important and is the sole reason why we keep launching features that users love and our competitors copy.
What should we be expecting from you in the future?
Right now we are so focused on building out Derek Media and Tatango and making them leaders in their respective industries, we don't think too far ahead into the future.
Thanks for your time Derek.