Interview: Social Networks for Pet Owners

I had an interesting conversation a few days ago with Mark Roberge, the founder and CEO of PawSpot, a social networking site for pet owners.  I met Mark a few months ago and we've had some good offline conversations since then.  At first blush, the notion of social networks for pets seems absurd, but then I'm not a pet owner.  PawSpot and others like Dogster are trying to make inroads into this area, so perhaps there is something to it.

[FULL INTERVIEW: MP3 | transcript below]

In fact, I've heard recently from colleagues about their personal stories about what are essentially offline social networks for pet owners.  Often, these may be centered on specific dog breeds or geographic interests.  I even know of someone who attended a dog birthday party (the owners merely chaperone the dogs, I guess).

In any event, Mark explained how he got the idea (he "stumbled across a number of dog owners that were venting to [him] about their problems and pet ownership; and there were tremendous synergies between those problems and the premise of social networking").  That's why PawSpot initially seeks to solve the challenge of pet sitting, rather than merely be a general purpose site for pet networking.

Mark also makes a good point about social networking generally.  Today, it is focused mostly on the teen sector.  But as that population ages and as an older demographic becomes more comfortable with the concept, there may be other opportunities to be had in the space:

I think you are going to see a bigger trend toward a more mature demographic; and I think, as you move in that direction, you are going to see less of the expectation that the audience spends four to six hours on the computer, like the teens do, and more focus on actual utility, actual tangible value, whether it is saving time, saving money, or whether it bridges the online and the offline worlds.

PawSpot will monetize itself through advertising, sponsorships, and e-commerce.

As for Mark himself, he says he enjoys entrepreneurship and compares it to the pioneers who explored the American west.  By starting a company, he feels he is "pushing the frontier forward." 

Transcript of Interview with Mark Roberge

Chip Griffin: My guest today is Mark Roberge, the founder and CEO of PawSpot. This is a site I have blogged about previously on "Pardon the Disruption," and over the past few months I have gotten to know Mark a bit through some offline conversations we have had. Welcome, Mark.

Mark Roberge: Thank you, Chip. Thanks for having us.

Chip: Glad to have you.

I guess let's start with the basics. Why did you start PawSpot?

Mark: Sure. It was about two-and-a-half years ago, I was actually doing some consulting, myself, in transition professionally, and, not by my choice, had fallen into the social networking space.

There were a number of startups in the Boston area that were looking at the space, and pulled me in to do some assistance on sales, marketing, business development, which allowed me to get a real insider's view of the model, and I was very intrigued.

Top-down, it made a lot of sense to me, in terms of customer acquisition costs, to word of mouth, in terms of operational models.

The users were actually driving the community, and this, to me, made sense, that the true Internet, and the future of the Internet in the next couple of years.

So I was off on a journey to find a market that made a lot of sense, and on that journey, stumbled across a number of dog owners that were venting to me about their problems, and dog ownership; and there were tremendous synergies between those problems and the premise of social networking.

So I took a much deeper look over the next couple of months, and put together the initial concept behind PawSpot, which has been a lot of fun for us.

I have had a career of, really, solving problems through technology--as most of us technologists do--and pet owners are an extremely fun group to work with.

To date, we constantly get emails from them saying, "Thank you so much." We got a dog adopted on the site. Last week, folks were hooking up in cities with other pet owners that they did not know in the past. So it has been a real fun group to work with, and we are excited about the future of PawSpot.

Chip: Why don't you tell us a little bit about what PawSpot is, and how it works?

Mark: Sure. Really, PawSpot is your connection, as a pet owner, to your local pet community.

So you come onto the site, you register, and you tell us a little bit about you, and your pets, and your life as a pet household. Then you invite your existing friends, in your community, to join your network and group.

You can also easily look around in the community, to see who else is there--who else has similar dog breeds, similar pets to you, similar problems to you. We really leverage the Internet to make all of that communication more seamless.

So, you can find pet-friendly events that are happening in your neighborhood on Saturdays; you can find people that are getting together in pet play groups, or put one together yourself.

There are so many dog clubs and dog groups that are cropping up in all of the locations, that are centered around breeds, they are centered around pet parks in order to raise money and make pet parks more enjoyable, and they are centered around neighborhoods themselves.

The lead feature, which we have really been working on, which has been one that the community has asked a good deal about, is a place to exchange pet-sitting together.

So there are a number of folks who would actually prefer that their friends and family take care of their pet--maybe they can't afford a pet sitter, maybe they have tried a kennel with no luck--and PawSpot is a great opportunity for folks to organize themselves into these trusted pet-sitting groups of people they know, people they trust, and to post up on the site when they are traveling, when they are working late, when they need someone to take care of their pet.

For us, that is just an initial feature, to organize people into these groups, get them accustomed to getting to know one another through the site; and we are working with the community to add even more and more features, to make pet ownership easier, more fun. That is really what we are here for.

Chip: I think what you have got there is an interesting approach market.

It seems to me that you are talking about solving a problem, rather than simply creating a social networking service as others have done.

Mark: Yeah, I think we differentiate from the major social sites in two different ways.

I think the majority of social networking sites today have focused on the teen sector, and I think we are being shortsighted to think that that is really the only demographic that can adopt value.

So I think you are going to see a bigger trend toward a more mature demographic; and I think, as you move in that direction, you are going to see less of the expectation that the audience spends four to six hours on the computer, like the teens do, and more focus on actual utility, actual tangible value, whether it is saving time, saving money, or whether it bridges the online and the offline worlds.

And that is really how we are positioning PawSpot.

Chip: That is another interesting point: the changing demographics of social networks.

I think there was a story, maybe it was last week, about how MySpace actually has a very significant over-40 demographic.

I don't know if you saw that story, but I wonder if that is something that you think is pretty significant to your business model?

Mark: Yeah, I did; and I do think this is a significant element of the prospect of PawSpot. I think that is the trend you are seeing.

Personally, I would steer away from any social networking sites cropping up in the teen sector. I think it is a little oversaturated, and I think teens are tough because they are so faddish. They can really jump, at a whim, onto an entirely new site.

The great thing about the mature audience is they are much more sticky. MySpace is a mainstream idea, today. It is hard to even talk to some folks in their 50s that have not heard of MySpace, and are at least curious as to what it is.

So with that happening, you are definitely going to see these social networking sites, these online communities, moving into the direction of these more mature audiences; and I think there is tremendous value to be created there.

Chip: Can you talk, for a minute, about the competitive landscape, both online and offline?

Obviously, online there are sites like Dogster, that are in at least a similar space; and then offline, you have got people who are already getting together at dog parks in big cities, that sort of thing. Just, if you would talk for a minute about that.

Mark: Yeah, sure. We do really feel that the competitive landscape in this space is extremely early, and that was the intriguing element of why I wanted to start PawSpot: not only is there tremendous value to be created, but very little of it has actually been created.

It is hard to figure why, just because the market is so big. Spending, in the past sector, it is a $35 billion market--it has doubled in the last ten years.

Pet ownership is the latest craze in every city across the U.S.; and you are seeing a lot of social trends that support it: less people are getting married, less people are having kids, and they are actually replacing that void with pets.

The biggest thing you hear about these days is the humanization of pets.

So in terms of the competitive landscape, I am not exactly sure why it has not been attacked sooner.

I think the majority of it is because of the downfall of Pets.com, which is a completely different model. And for folks that understand social networking, they realize it is not really fair to compare the two; but I think that some VCs that got burned, and entrepreneurs that got burned, have kind of steered away from the demographic for that reason.

But over the last two years or so, we are seeing that change.

Dogster has done a great job to come up with a model that really entails a virtual interaction between pet owners. It's still early--they have penetrated about 0.3 percent of the market at this stage.

They raised a million dollars, which, it's not a tremendous amount of money for startups, but it is enough for them to get out their concept to the masses, and I believe they are trying to take Dogster and Catster, and expand it into Horsester and Fishster, and some of the other pet genres.

So they have got a great model--I think they will be around forever, and I think they will roll up into one of the major media conglomerates, or become one themselves.

The rest of the space, there are a couple of players in it, it is very fragmented. I do not believe any of them are funded at this time, and any of them have even near 0.1 percent of the market.

So we do think that there is an opportunity to position multiple sites within the pet sector, in different ways, and stake out a position there.

Offline, really, it is sort of the pet services organizations that I guess could be perceived as competitors.

We, personally, do not see that. There are a lot of dog sitters out there, there are a lot of kennels out there, and we are just adding another option for folks, which is to make pet-sitting easier amongst your friends.

Personally, our medium-term plan is to find a way to engage the kennels and the pet-sitters as well, and to make it more of a cooperative venture, versus a competitive venture. So that is the way we perceive that.

Even with some of the other events, and clubs, and organizations that are sprouting up, they are by no means competitors.

We have a number of them that have teamed up with us. They see PawSpot as an opportunity to get their message out, to the folks they want to get it out to, faster.

These people actually drive our site. We take the time to get on the phone with them, figure out what organizations they are starting, how they are going to do it, what are the most difficult challenges in doing that, and figuring our how we can add features to PawSpot to offset those challenges and make things easier, and make these clubs and organizations larger and more successful.

Chip: Without spilling the beans on too much of your business plan, can you give us some sense as to how you expect to make money with PawSpot?

Mark: Yeah, sure. This is actually one of the biggest things that we have seen that is different from the late '90s in the online space. There actually is the advertising infrastructure that can support a business and take it to break even.

There are a number of actual case studies we can point to, in the social networking space, that have done this.

This whole advertising model is somewhat of a swear word to VCs these days, but people are doing it, and I think both the ad infrastructure that is out there, as well as the fact that the capital and infrastructure costs to get these sites up, is so much smaller, just because your users are getting more users involved, which keeps your customer acquisition costs down; and then also, in most cases, providing the service itself, which keeps your operating costs extremely low.

So you can see on the site, today, some advertisements happening. They are certainly not going to be advertisements where we are selling information, or telemarketing, or sending direct mail, or spam.

They are really just the advertisements of placing the banner on the side of the site, and we really try to team up with sponsors that are synergistic with our brand--they are trying to do something good, whether it is through a natural food approach, or other approaches that can hopefully add value to the overall community.

Longer-term, we are certainly going to add an e-commerce function to the site. There is a significant shift in spending that is happening in the pet sector, that is pushing things more toward the higher-end, premium services, and that actually is a void that has not been filled, in this space, and we think we have got an opportunity to capitalize on some of that.

We also have some ideas on some premium services opportunities, to add back to the community, that a lot of social networks have used with success and we will certainly implement as well.

Chip: What would you say the biggest challenge is that you have face so far with PawSpot?

Mark: That's a good question. We have laid out a pretty decent plan here, and have hit most of the milestones: we did raise some capital, we have hit most of our numbers and site development milestones, we did land a major advertising partner at this point.

So I'm keeping my fingers crossed, but so far the milestones have been hit as we projected.

I think the hard thing about communities, both for PawSpot and for any of these social networking places, is really putting together a site and a process that the community loves, and that the community is willing to drive, and adopt, and get other folks onto.

I think, especially here in the Northeast, we are very accustomed to B2B enterprise software plays. I actually did a couple of entrepreneurial ventures before, in that space; and we know the name of the game there--it is basically, get one or two big clients really excited about your product, on board as a beta customer, and revise the product from there.

You can't do that in social networking. You can't do that in the consumer space. They either love it or they hate it.

When they love it, it is extremely exciting, because there is not a sales cycle typically associated with selling an individual consumer. Especially with social networking, word can spread extremely fast.

So I think the biggest challenge among all social networks is crossing that extremely fine line of a product that is mediocre, that people kind of forget about it, and a product that is absolutely exceptional.

We have actually taken certain features, and when we threw it up there, it did not cross that line, and the thing that we really focus on a lot is, we get on the phone at least half a dozen, a dozen times a week, with folks in our target customer base--so, folks that we meet in our travels, and dog parks, and through friend networks--we just jump on the phone and ask people to run through these features.

And it is really surprising that time and time again, we have thrown up a feature that just did not stick, we talked to about 10 or 20 people, it was extremely evident what the issue was--and it was usually just a minor tweak--we made that tweak, and it just blew up. It was great.

So I think that is the biggest challenge, is just identifying what that fine line is between a mediocre implementation, and a home run, and how you get there.

Chip: You mention that this is not the first time you have sort of caught the entrepreneurial bug, or been involved in entrepreneurial activities. What brought you to be an entrepreneur? What is it that attracted you to that, versus working for "The Man," as it were?

Mark: Yeah, that is probably a podcast in itself, Chip.

It is always a really tough question for me to answer, because I probably have a dozen answers; but let me try to stick with the one that comes to the top.

I guess, when you think about everything that you do as an individual--your personal, your professional goals--entrepreneurism just really fit.

I love to kind of combine technology innovation with creativity, and really do something innovative.

I just got out of MIT's business program, where I tried to formalize my position here in the entrepreneur community for that reason.

I think this particular are, in Cambridge, in Boston, and entrepreneurship itself, is a place for innovation, creativity--I kind of see it as us being sort of the pioneers. For the Americans that listen to this, who do we read about, in the 15-1600s? We read about the pioneers that kind of pushed the frontier forward.

And unfortunately, today, we have kind of found all of the land on the planet, but we are pushing the frontier forward in other areas, and it is really the entrepreneur community that is doing that.

So if I am going to dedicate my life to anything, it would be to that.

Chip: Great. Well, Mark, I really appreciate your taking the time to speak with me today, and I wish you the best of luck in the future.

Mark: Thanks so much, Chip.