Joe Matthews came into the Kellogg School of Management in 2007 with a typical financial services background: some investment banking experience at Morgan Stanley and then three years at Deloitte as a Strategy and Operations consultant. But when he graduated from the business school two years later, he found himself CEO and co-founder of Poggled, a web start-up aiming to save customers money at popular nightlife spots and events through discounted drink deals and party packages. On Thursday, October 6th, Poggled will sponsor an exclusive concert featuring popular mash-up duo The White Panda and Northwestern’s own Chet Haze at The MID. “It is our first time experimenting with doing an event and paying for some talent to perform,” Matthews said.
Matthews took some time away from his busy schedule to talk with the Northwestern Business Review about Poggled’s future and business strategy and the ups and downs of running a web start-up.
NBR: Tell me about your personal background.
Matthews: I went to Indiana University in Bloomington and then worked at Morgan Stanley for two years in investment banking. From there, I worked in consulting for a couple of years at Deloitte before going to business school at Kellogg. I co-founded Poggled in my second year at Kellogg. During my time at Kellogg, I worked part-time at an incubator in Chicago, I2A, where people with all kinds of crazy ideas would come in to apply for grants. What we would do was analyze and look for the ones that seemed good and recognized patterns of need. There are all sorts of metrics that exist and good start-ups need to recognize them.
NBR: How and when did the idea for Poggled come about?
Matthews: We started the business in March 2009. It originally started as a social network in the nightlife space. There were all sorts of applications coming out of mobile, web and social media technology. We (Matthews and co-founder Sean Strother) thought there was a big opportunity to come out of this.
NBR: What is the biggest challenge of running a web start-up?
Matthews: One of the challenges is that you have to have some hypothesis about why the world needs to be changed by your company and how you’re going to create value. No one starts a business unless they stay completely focused on it. At the same time, there are a million metrics for web businesses to track and measure. So I think there is a tension between showing people that your company is something to be pumped about and constantly improving metrics.
NBR: Tell me about Poggled’s business strategy.
Matthews: We are not a daily deals website like Groupon. Our deals are available for the entire year and customers can buy them forever. The biggest draw for Poggled is the savings. For example, I love having brunch at the Bull and Bear (one of Poggled’s featured spots) and every time someone uses the restaurant’s Poggled deal, the Bull and Bear makes money on the transaction and customers save money. We also do social parties where we send out an email to subscribers and give out deals to consistent users on Facebook. One deal is brunch for a dollar, so that user will buy the deal and go with friends, and the restaurant will make money from the other people who accompany him or her and pay full-price.
NBR: Poggled is currently in four markets: Chicago, Denver, Milwaukee and New York. Are there any plans for expansion?
Matthews: We do have plans for expansion. Right now, we’re trying to grow as much as possible in the markets that we are currently in, prove that we are able to scale those markets and when we do that, move Poggled into new markets.
NBR: Tell me about the confidence you receive from being funded by Lightbank, which was involved in Groupon’s seed funding.
Matthews: Having Lightbank’s expertise is probably the biggest draw. They also give better pricing than a lot of other VCs (Venture Capital firms). While we give up a bigger stake in the company than we would to a different VC, having their probability of success with start-up companies is worth it.
NBR: Do you have any advice for young entrepreneurs or anybody looking to start a company?
Matthews: I think the best way to figure something out is to go do it. You have to have a passion for something if you want to make it work. Don’t make your venture just sporadic, instead go figure out what you want to do and make it count. Starting a company is not about building an empire over night.
NBR: Poggled is about going out. Where are your favorite spots to go out in Chicago?
Matthews: I love having brunch at the Bull and Bear. The Friday night parties at District are also pretty good. Our big upcoming event is The White Panda and Chet Haze at The MID and I hope to see a lot of Northwestern students there.