How 2 roommates got shot down by hundreds of startup investors and racked up credit card debt - but built a newsletter empire anyway
Carly Zakin and Danielle Weisberg cofounded theSkimm, an email newsletter sent to 5 million subscribers every day at 6 a.m.
TheSkimm picks the most important new stories of the day and tells readers what they need to know in a conversational tone that's full of millennial lingo. Loyal subscribers include Oprah and Hillary Clinton's former campaign manager, John Podesta.
The business was far from easy to build. Zakin and Weisberg quit jobs at NBC only to get turned down by "hundreds" of venture capitalists, who saw no value in creating an email company. Together, the pair went into credit-card debt, which they say they finally paid off just last year.
We sat down with Zakin and Weisberg to talk about their battle stories, how they eventually got investors on board, and how theSkimm took off, all on this episode of "Success! How I Did It," a Business Insider podcast hosted US editor in chief Alyson Shontell that explores the career paths of today's most accomplished and inspiring people.
Check out earlier podcast episodes with:
- The founder of Tinder, Sean Rad
- Bleacher Report and Bustle's founder Bryan Goldberg
- Early Uber and Pinterest investor, Scott Belsky
- The co-CEOs of Warby Parker, Neil Blumenthal and Dave Gilboa
The following transcript of the interview has been edited for clarity and length.
Alyson Shontell: Carly Zakin and Danielle Weisberg launched theSkimm, a morning email newsletter, in July 2012. Business Insider wrote the first article about it back then, and today the newsletter has over 5 million subscribers, including Oprah and Hillary Clinton's campaign manager, John Podesta, as we learned last year after WikiLeaks' publication of Clinton's hacked emails.
To start, I wanted to go back to 2012 and even a little before that. You met as students studying abroad in Rome. You both worked at NBC and then quit to start a newsletter. Tell me about that process.
Danielle Weisberg: Thanks for having us - it's exciting to be back here. You wrote the first article about us, so it's a lot of déjà vu. Carly and I met studying abroad in Italy. We had a great time and didn't think about what we were going to do later on. We had really similar backgrounds. We're both storytellers, we love journalism, we love news. It was our passion.
We started interning for NBC news as soon as we could and we grew up in that world. NBC was our universe - we always wanted to work there. We worked our way up the ladder from intern to full time, and then we were producers, and between the two of us, we worked in pretty much every news division they had.
We were roommates in an apartment in New York, and we would come home to each other every day and talk about two things.
One, as clichéd as it sounds, we were very much having a quarter-life crisis. Being 25 and 26 and loving what we were doing but wanting to move up and not wanting to hear that you have to get in line and wait 10 years for a position that might open. That was really frustrating as two people who loved what they were doing and wanted to do more of it.
The second thing was our friends who were smart and had great jobs and knew everything about their industries would come home and ask us what was going on in the world. That was our job. That's what we did for a living. We read all day long, and we reported on the news and our friends didn't do that. They had other things to fill their time with. It wasn't a matter of intelligence, and it wasn't a matter of interest; that's not what they were being paid to do.
So we wanted to create a news source that actually brought this audience that was exemplified by our friends, female millennials, who are smart and leading in so many ways, but didn't have a news source that they loved, and we knew that we could create that.
So the newsletter was never the be-all and end-all. It was the beginning to a very big empire that we knew we could create in harnessing the power of female millennials, and being their go-to source for information that really matters and can drive the big decisions that they're making in their lives.
Shontell: When you did this in 2012, it felt like newsletters had been there, done that. Daily Candy had been acquired for a ton of money; Thrillist, a popular guy newsletter, had been around for a few years. What made you think that newsletters were where it's at?
We were like,"No, the very first thing you do in the morning is you turn off your alarm, it's on your phone, you grab your phone, and you literally open your email to be like, Did someone die? Am I getting fired? or Is my boss yelling at me? and What did my friends send me? And we knew we had to be in that moment. One of our friends worked in finance, and she left for the office at 5:50 in the morning every morning. So we were like, we gotta get it out to her on that commute. So we chose 6 a.m.
A lot of the hallmarks of what theSkimm is about, that one-eye-open routine, we call it. Being in that moment and being there at 6 a.m. happened because we were just thinking about our friends' daily experiences. We weren't overthinking it. We weren't like, let's A/B test this. We didn't even know what A/B testing was.
When we started theSkimm, we started meeting with investors, industry experts, and everyone was like, email is dead - this is a really bad idea. But they would email that to us.
And we would just laugh at it because we're like, you're saying email is dead, but you're emailing that to us. And we both still read email every single morning. Obviously, since then, we've seen a resurgence of email newsletters, and a lot of that, we've been told, is credited to what we've done.
But for us, I think we've talked so much about all the things we didn't know. We haven't spent a lot of time talking about what we did know. And what we did know is that we knew how to talk to this audience, who they were, and we also knew that we were not starting an email newsletter company. We knew email was a marketing tool.
'We made a list of all of the investors, angels, and seed funds, and we would turn anyone who said 'no' red - then the whole list was completely red'
Shontell: Talk about quitting your jobs at NBC. Because you did that and bootstrapped for a bit, right? You said just now there wasn't a ton of investor interest, you were first-time founders with no technical background. That's everything that makes a venture capitalist run away.
Zakin: Yeah, everything that would make you not think "This is a good idea."
Weisberg: It's funny when people ask that, because they're like, "Oh, you decided to bootstrap it." And we're like, "We didn't 'decide.'"
Zakin: "Bootstrap" is such a generous term because it makes it seem like we had money to bootstrap. We worked in media in mid-level jobs. We had just over $4,000 between the two of us. We lived in a rent-stabilized apartment downtown and agreed to go into credit card-debt together.
'Bootstrap' is a generous term. It seems like we had money to bootstrap. We worked in media in mid-level jobs. We had just over $4,000 between the two of us. We lived in a rent-stabilized apartment and together agreed to go into credit-card debt.
We just both paid off our credit-card debt in the last year or so, and it was a huge sacrifice, that even looking back now I'm like, "I can't believe I made those choices." Because it sounds so unlike myself, it sounds so unlike Danielle.
Weisberg: The other part, too, is people hear our story now and they think about it as two women decide to quit their jobs and start their own company. Quitting our jobs, it was the scariest day of our life. That was not easy. And those first months ... every point of this company has been hard. That's the case anytime you're building something. But those first months, we only got through it because we didn't have a backup plan. We didn't have a safety net financially or emotionally. This was everything.
That was our saving grace, because there was no plan B. There was only, "We're on our couch, we can't afford cable, we've maxed out our credit cards, our parents are giving us hugs." But that was the support. Carly's parents made us a lot of dinner. That was it. There was nowhere else to go.
So when everyone was saying no, and we made a list of all of the people - all of the investors, angels, seed funds - and we would turn anyone who said "no" red. And then the whole list, which was a lot of names, was completely red. I remember a day in our kitchen, we had just gotten off a pitch that again ended with "Thanks so much, not interested," and we just had to make a decision. Are we going to go for this or are we going to go try to get jobs freelancing for the 2012 election?
It wasn't really even a decision - it was just a half-second to reevaluate where we were, change our pitch a bit, and that was it. That was the closest we've ever come to a crisis of confidence in this company. If you let those things get to you early on, then you don't know what else is coming. There are going to be a lot more challenges.
Shontell: Had you launched the first newsletter at that point? Why quit your job if you're launching a newsletter to begin with? You can do that while keeping your 9-to-5.
Zakin: Well, two things. One is we had both weird schedules. I worked daytime and Danielle worked nights. So we couldn't do that. One of us would have had to change our schedule.
Second, we took a Skillshare class while we were employed, and it was ironic because the class we signed up for was "How to Find Your Business Partner" and that was the only thing we knew how to do. But the person who taught it, Alex Taub [an entrepreneur and investor], became a mentor to us, and he was one of the first people to tell us, "If you're going to start something, you need to be all in. How can you ask anyone to even think about giving you money if you have not made sacrifices to prioritize the effort yourself?'"
When people come to us and ask for advice on starting a business and are like, "I can't afford to quit," I still have mixed feelings about what to tell them. Who am I to tell someone what financial decisions they should make? But for us, we were asking people to believe in us, and we had to show that we believed in us so much that we were willing to take a huge risk ourselves, quit our jobs, have no financial security, and give it a shot.
So we took that approach. That's not for everybody. I don't know if it could have worked out differently. But there was actually a third reason.
A lot of people ask us, "Why didn't you just bring this to NBC? Why didn't you get this in front of Steve Burke?" There is no way that NBC would have allowed two associate producers to not only run the editorial but to run the business side of what we were doing. There was just no way. We knew that in our gut.
Weisberg: That would have ruined the company in a lot of ways in starting off, because the authenticity of having this idea came so much from our friends, and it was developed around routines of this target audience. It couldn't then have had a successful launch if it had then been led by people who had been doing this for 30 years and thought about the same strategy that had worked for all of these other companies and startups. That's not what we're building.
4 days after launch, theSkimm got a shout-out from Hoda Kotb on the 'Today' show, and it changed everything
Shontell: Tell me about launching your first Skimm. Who did you get to subscribe?
Zakin: We didn't add anyone to the list. We sent an email to everyone in our address book. When we say everyone in our address book, at that point you could download your Facebook friends' email addresses, so we literally took every email address that we had in our possession.
Meaning like, my grandma is on chain letters, chain mail that she forwards. We took those people. So we had, between the two of us, 5,500 names. We sent an email and were like, "Hey, we quit our jobs and we're starting this. Can you please sign up?"
That first day, almost 800 people signed up. But we didn't add anyone to the list. I think the first email had our closest friends and family on it, and it was not a lot of people on it.
Shontell: So 800 pity subscribers?
Zakin: Eight hundred people who were like, "I'll take a look."
Weisberg: The first went out to our family and friends. And then there were two press articles that came out on the first day, and Business Insider was the first to cover us. Thank you! And we got the traction from that.
It all happened very quickly, because we had also emailed every news anchor out there, truly. We didn't know most of them, but we were like, "We're former NBC-ers, thought you would love this, thought you would appreciate the need that we're solving." Most of them didn't respond. Hoda Kotb responded, and she said, "I'll check it out!" We did not know her. We followed up with her two more times, but got no response. Day four of us in business, she said we were one of her favorite things - on air - and it totally changed our life.
So we went from, at that point, let's say under 1,000 users to thousands. All of a sudden, we had geographic diversity. And all of a sudden, we had huge pockets of the country paying attention to what we were doing.
Shontell: Wow. What does a Hoda bump do to your newsletter subscribers?
Zakin: It crashed our site. It crashed our email inbox. We got a few thousand people from it. It was so funny, we were actually back visiting our old bosses at 30 Rock. We were in Starbucks and I tried to load my email and it wouldn't load. Then someone wrote on our Facebook wall: "Just saw you on the 'Today' show." And we thought we were caught walking on the plaza in the background, and we were like, "Oh, how embarrassing - what were we doing?" Then someone had posted what she had done. So it was life-changing.
Shontell: How did you create the voice for theSkimm? It's really something that resonates, and sometimes people will say, "Are they dumbing it down too much?" Or "Do women need their own news source?" But the voice did set you apart, so how did you create theSkimm's tone?
Weisberg: It was the easiest part of building this company. The voice comes from how people speak and how we talk to our friends. We spent a lot of time thinking about, "How do we launch this? What are we doing? What's the ultimate vision?"
We literally sat down in separate parts of our apartment and went to write what would become the Daily Skimm. We came back together, and we hadn't really talked about what the voice would sound like, aside from knowing that it would be how we actually speak to our friends. And we came up with the exact same voice. Since then, we have put a lot of time into explaining the voice to our team and putting a brand guidebook together, and talking about how well we know theSkimm girl, our character inside and out.
Anyone on our team can tell you what her favorite drink is, what she's going to order at Sunday brunch, and it's a living, breathing document - what she likes and where she is in life changes. That is something that everyone in our company knows because they're all telling the story of theSkimm and this character is who the brand is.
So when we put the voice together, it's not for everyone. I think that when we hear criticism like that, that the voice is condescending, we hear it all the time, it's nothing new. I don't think that there should be a one-size-fits-all approach to news. Just because someone doesn't like it, that doesn't mean it's for them.
Shontell: You have coined terms like Mitt Romney was "Mittens" and Hillary Clinton is "Hillz." Business Insider has found the same, that there's something to a conversational nature. That doesn't mean you're dumbing it down; it means you're explaining it so that everyone, the really smart people - because you've got incredibly smart people like John Podesta on your email list - and the people who aren't heavy in politics can understand it.
Weisberg: I think it also goes back to what we were creating, which is it's not something for experts. It's not something for just people who love politics or who love business. That was a huge thing that five years ago when we started the company, we saw such a trend toward personalization. That was the hot thing, and you should be able to just get information about what you're interested in.
That's great, but it left a huge void for people just to be well-rounded. So we want to arm our audience to be able to participate in all types of conversation with all types of different people, and not feel like, "Oh, I work in finance, and my hobby is baseball. So those are the things that I'm going to filter my news on."
That was a huge difference when we started, and that was something that people really latched on to, as well as we were describing business stories and not having words that you had to look up. When we started writing theSkimm, I remember we did this experiment where we were reading a story, and we would kind of highlight if there was a word that we couldn't explain. If that was a term or a sentence we had to go look up and read four times through, that's kind of broken.
Weisberg: We're smart, we worked in news, we were following these stories day in and day out, and if we couldn't understand it, then how can you expect that from people whose job isn't to be up on what's going on day in and day out?
Raising the first million, and hitting No. 1 in the App Store for news
Shontell: I'm interested in how you got out of your debt. A newsletter that racks up subscribers is great, but at the same time, it's also not immediately clear how you'll start making money. Certainly not enough to pay your salaries and employ people.
Zakin: One is that people still ask us, "How do you guys make money?" And I remember we were on a panel and Danielle just got pissed off and was like, "We make a lot of money!"
Weisberg: I was done.
Zakin: So we're proud to say that we do very well. And it goes back to what we knew, which is that email is a marketing tool. Our goal from day one was to place a long bet on loyalty.
What can you do with loyalty? How do you develop a community, get people engaged? And from there, you can activate them, and in many ways directly monetize that. From truly day one - maybe let's not be hyperbolic; let's just say day four - we had brands reaching out to us, like our wish-list brands. Saying, "Just got this, would love to advertise." We knew nothing about how to work with an advertiser. So instead, we said, "We're actually not working with brands right now."
By doing that, I think we created a little bit of mystery. Our list kept growing. There kept being more press about how big our list was and who the audience was. And we weren't letting brands in.
What happened over time was that we continued to gain a lot of traction. We were meeting with venture capitalists who said to us, "Email is dead. Why are you going after a niche market like women?" Which is ridiculous. And who were like, "My wife reads it."
As Danielle said, we literally had thousands of "nos" in a spreadsheet tracking all of it. So it had been a year and a half almost of the two of us on our couch, in coffee shops, just growing organically. We got to about 150,000 users, and we were able to take in a little bit of seed money.
Shontell: How long did it take to get to 150,000 subscribers?
Zakin: Less than 18 months. It took us one year to get to 100,000. Once we got that first big check - we raised just over $1 million - it was life-changing. We took a picture of it in our bank account. We were like, "We've never seen this many zeroes." It was so exciting. We treated ourselves to nice haircuts, and then we went to go hire a team.
In hiring a team, we really chose to double down on growth. We had one goal, which was to get to 1 million users in a year. We ended up doing it in six months. Then over the course of that year, we started to let brands in, but really selectively. What we've been doing over the last four and a half years is building out two businesses.
We have a media business. We work with sponsors in a really needed capacity, and we're really great storytellers with that. If you asked us, "Do you think it's a really innovative that we created an email newsletter and work with brands to email a newsletter?" No. That is not why we raised venture-capital funding, and that is not why we're building a huge business. What we're doing is we have turned that loyalty into a community. And a community that we can activate.
The other business that we have is a subscription business. We launched our first subscription product just under a year ago, which has been a huge success, called Skimm Ahead. And for us, these two businesses and subsequent capital raises we've taken in have helped really create what Danielle said. We're building an empire. That is how we feel.
Shontell: Talk about Skimm Ahead. That's your new product. What is it?
Zakin: TheSkimm, as a company, makes it easier to be smarter. We looked at the Daily Skimm. We were like, "Here's an email that makes it easier to be smarter about everything that happened yesterday, and everything you need to know about today." And then we thought, "What's the routine that we all share? And outside of email, what happens next?"
For us and our friends, we look at our phone, and I immediately look at my calendar, and I'm sure you are like us, and you live on your calendar as well. So we thought that was a really interesting way to deliver information. When we thought about what information could we solve next, it was that moment that we all have of, Wait, when is that happening? When's that show back on Netflix? What time is March Madness on? When is the State of the Union? What night? It was about the idea of making it easier to be smarter about the things coming up.
So we created a subscription product that costs $2.99 a month. It can integrate directly into your calendar. For us, it really pushed the door open toward subscription. We had a hunch - we obviously made more than an educated guess - that our audience would be willing to pay for something. I don't think we had any idea what we were stepping into. We're so excited about how well subscription has gone over with our audience.
Shontell: Are there any metrics you can share to show it is an early success?
Weisberg: We can tell you we were No. 1 for news in the App Store in our first month. We continually beat The New York Times and The Wall Street Journal in highest-grossing news apps every month. Apple actually asked if we had figured out how to hack their rating system because they had never seen so many five-star reviews.
Building a marketing empire on loyalty, not scale
Shontell: The venture capitalists did finally come around, and you've now raised $15 million. But it is hard in the media environment right now. There's a lot changing. Fifteen million dollars is a lot, but it's not the $200 million Vox and BuzzFeed and others have raised. How do you look at the media climate, and how do you plan to survive?
Weisberg: A blessing for this company is that we've never fit in. People have been constantly surprised by our audience, even when we've gone out for raises and the traction has been there. We've never been what venture capitalists have been looking for. So I think us trying to guess or trying to figure out what the trends are in media has never been helpful to us, because we've always been carving our own path.
It took a long time for people to understand what we were building. The criticism that we got was always like, "Oh, it's just that newsletter." And I think that it really came through strongly with the election.
We launched our "No Excuses" campaign, which started with, How can we rally our entire company and our audience around getting people to vote? And at a time when a lot of other media companies were facing this crisis of confidence from their audience, and they were endorsing candidates and hearing a lot of backlash for it.
We've always been nonpartisan. Our stance in the last election, just like the other elections that we've covered, has been to get people out to vote. So we interviewed the candidates, we launched a big destination site, and what we are most proud of is that we got over 120,000 people to register to vote, making us pretty much Rock the Vote's biggest partner ever. That's over 90,000 women. That's unprecedented.
The biggest part of our company is our Skimmbassadors. We have the media business, we have the subscription business, and then we have the community element. They are why Apple called us to say, "How did you get so many five-star reviews in such a short period?" Our Skimmbassadors. We have over 20,000 of them. They've started off as just people writing in saying "I love your product." We would ask them to get 10 friends to sign up. And they became pen pals.
Zakin: We call it "intimacy at scale." We genuinely know subscribers' names. We really know who they are. Of course you can't do that for 5 million people, but we have a community. We know how to activate them.
Shontell: Facebook has 2 billion monthly active users. That is tremendous scale, but there seems to be this movement in media and tech happening where maybe you don't need that many people, as long as they're loyal.
Weisberg: We talked about it with our investors very early on. We've heard various founders of some of those companies speak, and we're such fans of them. But we look at them and we're like, "It's so funny to us that VCs ever put us in the same sentence as them because we couldn't be more different. We would much rather say we have 5 million people we activate and get to pay for a subscription product. Or we can get them to turn out in the hundreds of thousands to vote, than say "We've got 20 million of them, but only 2 million of them open us every day." That's not interesting to us.
Zakin: That's why we've always been our own category. As these media trends - and what's hot and what's not come up - we always knew who we were. We always knew what we were building as a company, and we've been lucky to be surrounded by a board and investors and advisors who respected that and respected our vision and helped us along.
At times we got, "Well, you're not BuzzFeed, you're not at BuzzFeed's scale." And we're like, "That's because we're not trying to be BuzzFeed." BuzzFeed's great, we think they have great stuff, but that's not what we're trying to build as a company.
It has always been about staying true to our vision and staying true to our audience in that whatever we create has to be additive. It has to be a voice that they trust, and it has to be part of what they actually need to get through their day. That's what they find whenever they interact with our products.
There's a new New York Times best-seller list for millennials
Shontell: One thing that's interesting that you've built loyalty-wise, and we've seen it being on the receiving end when you put a Business Insider link in a Skimm newsletter, we see a flood of traffic. Are we allowed to talk about this? How when theSkimm recommends a wine, and when it recommends a book, it's often better performing sometimes than even The New York Times?
Zakin: We've been told by publishers that we are the No. 1 way to sell books for this audience.
Shontell: Above being in the New York Times best-seller list?
Zakin: Above "The Today Show" and above the New York Times best-seller list. Multiple publishers have told us that.
Weisberg: You can see that by walking into our office. Publishers are sending us cartloads of books. And we're like, "We just need one or two."
Shontell: You put one in a newsletter every day, right?
Zakin: One every Friday, and a bottle of wine that we like every Friday. We happily taste-test the wine and happily read the books.
Shontell: Do you get affiliate fees?
Zakin: Yes, and we are open about that in the newsletter. But we choose what we think is the best for this audience. It's not about, "Oh we're going into the book business." That's not what we're saying. It's about being in the engagement business.
We can drive as much traffic to a Business Insider article as we can to driving book sales and as we can to driving sales toward our new products with Skimm Ahead. It just goes into the powerful relationship that we have with our audience. We feature products and brands we like all the time, and I can't even tell you how many brands have said we've changed their business trajectory because they were featured in theSkimm. That's a wonderful feeling, and we've been told we have the Oprah effect. We would never say that about ourselves, but we're happy to repeat the quote.
Shontell: Definitely. And Oprah is a fan right?
Zakin: Oprah is a fan, which is a very surreal sentence to say.
Shontell: You've grown tremendously, but I'm sure it's still early in the company's history. What do you think is next? Are you going to do video? Are you going to do an audio version of theSkimm?
Weisberg: I think it's all coming. It's just about how you prioritize it and when you release it. We started the company with two guiding principles. The first is that we have a voice - the voice is very clear - and it's in all products we create.
The second is that we really have a strong belief in looking at the routines of this target audience and fitting that in with what we release and when. That's the same thing, you wake up, you get an email telling you what you need to know for your day, and then you step out your door and you get your calendar. So those two things are very much in our product roadmap.
We did video. You can check out our Instagram and Facebook site for some of the video that we've been producing. We just did one on equal pay and we did one on Syria and immigration and it's gone over really well. That's just the beginning of what we're doing and what we're testing. As former video producers, it's exciting that we're going into that, and we clearly see a lot of interesting ways to work with brands.
So that's up next. It's also thinking about other products and services that fit into the routines of this audience that we've always wanted to create and haven't had the time or the ability to focus on other things. That's the benefit of being where we are now with the amazing team that we have, that we can really start thinking about what was in our head five years ago and three years ago, and now it's actually the perfect time for us to create those things.
Shontell: How does theSkimm newsletter come to be every day? How do you pick the stories? Who writes it?
Zakin: I think we developed our secret sauce. Of our team of 41, only five are on the editorial team. We still touch every word and see every word.
Shontell: What is everyone else doing?
Zakin: It's tech, analytics, sales product, really. For us, it's about every day, it's the best part of our day to pick the stories. It's the same principle that we started with, which is: What will our friends need to talk about? What's becoming a story? What already is a story? And what will feel old by tomorrow?
We want you to be able to go to any work or social event and talk to anyone about anything. We love doing that, we love picking the stories every day - it's the easiest and best part of our day. The last edit is made every morning at 5:58.
Shontell: Ready for that 6 a.m. deadline.
Shontell: Congrats to you both.