The Virtual Phone System Designed for Entrepreneurs

Interview by Kevin Ohashi of Ohashi Media

David Hauser co-founded Grasshopper.com with Siamak Taghaddos in 2003. David is the Chief Technology Officer at Grasshopper.com amongst many other responsibilities such as managing operations and corporate culture. He started Grasshopper.com while a senior at Babson College where he received his BS in Business. David and Siamak started Grasshopper.com to solve a fundamental problem they ran into as entrepreneurs: the need for a professional phone system on a startup budget. Grasshopper.com was so successful that it became profitable within a matter of months. Since then David has received numerous accolades such as being named one of the ‘Top 5 Entrepreneurs Under 25′ by BusinessWeek.

Today, Grasshopper.com provides virtual phone services to over 30,000 customers and is still growing. David and Siamak continue to grow the business and generate interest and buzz around their system in clever ways. One of their latest buzz creators is a videos called ‘The New Dork,’ a parody of Jay-Z and Alicia Key’s Empire State of Mind music video which is exceptionally catchy, so much so that publications like the Wall Street Journal and TechCrunch did pieces on it.

MO:

You launched Grasshopper.com in 2003 while you were still in college. Could you tell us a bit about the process you went through up until that point? How did you meet your partner, where did the idea come from and what made you decide to really go for it?

David Hauser:

Prior to college the entrepreneurial bug had gotten me and I had started other companies so Grasshopper really came from a need we saw in past companies. It was a simple need to sound more professional and look bigger with a virtual phone system that did not cost a lot. Nothing like this existed in the market so we created what we wanted. Siamak and I met at Babson College via a mutual friend and I cannot think of a specific decision point where we said let’s go for it as much as we just started that way and never looked back.

The process of starting a company while still in school while daunting was a great experience and a perfect time for people to start their entrepreneurial journey. We had access to amazing resources in professors, great energy from other students and really an environment and time in our lives when failure was acceptable.

MO:

You were profitable within a few months if I understand correctly. One of the hottest topics in web startups these days is traction. How did Grasshopper gain traction? You probably tried many different things, and we continue to see your innovations such as ‘The New Dork’ viral video, but could you tell us about some of your early efforts and what worked and what didn’t?

David Hauser:

From the day we started until today we have bootstrapped everything so we had no option other than to be profitable very early which many startups that raise money miss early on. The idea of traction is very important although I would use the phrase, getting customers willing to pay for something you do. With the first internet boom and now the social media boom too often traction can mean number of users and have no relation to making money and that is sad. We tried everything we could think of but in the early days Google AdWords and customer referrals were the largest and best ways we found to grow. Of course as we expanded we have tried many things, failed and many more and then had fun with creating videos and other content that entrepreneurs can enjoy.

MO:

Your responsibilities seem to be quite diverse from CTO to managing the company culture and values. It reminds me of Sergey Brin at Google who is said to keep the company’s values in check. You’re described as creating ‘an environment that is professionally and personally rewarding for all employees.’ Could you tell us about your company culture philosophy and was it something that was clear from the start or did it evolve over time?

David Hauser:

My title is always interesting but as anyone in an entrepreneurial company will tell you the title tells you nothing about what a person does, some day I will come up with a more creative title but for now we are growing a company. Core values and culture are very important to me personally and have become very important for the company culture over time. When we started we did not clearly articulate the values at all and that was a big mistake and today we talk about it all the time. While the values never changed we learned how to talk about them, use them in coaching and rewards and most importantly hire for them.

I encourage everyone to look at our values (grasshopper.com/about-core-ideologies/) as we try and make them as public as possible as we live by these every day and it is what makes us successful.

MO:

Your company has over 30,000 clients today, what were/are the biggest challenges you have faced in scaling your business?

David Hauser:

When we started we always thought the biggest challenge would be technology scaling and while this was not hard the biggest challenge has been staff scaling. As any company scales there are growing pains along the way and people and processes need to change over time.

MO:

The telephony, Internet and mobile landscapes are changing so rapidly these days. What are the biggest trends you see happening relevant to Grasshopper and how do you address them? What keeps you on your toes even after you have achieved a high level of success?

David Hauser:

Grasshopper is all about empowering entrepreneurs to succeed and we may have found a small amount of success with our virtual phone system but it is just the start of what we are doing on our way to 1,000,000 entrepreneurs as paying customers. This is what keeps us driving forward, no matter the change in the industry or the new industries we may enter, we have a single and shared goal.

MO:

What was the biggest mistake you made while running Grasshopper? If you could go back and do it differently: would you and if so, how?

David Hauser:

We have made lots of mistakes as any growing company does and learned from them at the time so we do not make those same mistakes again. Many would say that it is best to learn from mistakes but to answer this question best I will use a quote from Nando Parrado one of the people the move Alive was based on, “looking back will give you nothing more than a pain in your neck”. I would not change anything we have done as it is what has gotten us to where we are and all we can do is move forward every day.