Founders Story: Klout founder Joe Fernandez

This is the unedited English version of my column published in
Japanese by Sankei

Klout is a unique company, it has successfully built a way to rank
social influence online. The company assigns Klout scores to
individuals based on how socially influential you are.

Politically its a very difficult business, no one wants to be ranked
and yet everyone is curious to know how they rank. Many have
questioned the business model behind Klout and the value of a Klout
score. Despite this the founder Joe Fernandez continues to push
forward, growing the company every single year. Now users with high
Klout scores can benefit from airline perks or special treatment at
hotels. You can find Klout implemented in many of the web’s top social

I recently spent time with Joe Fernandez while he was in Japan and was
really inspired by how he struggled to build his company into
something now worth more than 200M USD.

Take for example the fact that Joe moved Klout’s offices into the same
building as Twitter, then monitored twitter and foursquare for people
checking into the twitter headquarters and piggy backed off of
twitter’s meetings by asking to meet with executives after they
finished their twitter meeting.

Or the story of how’s domain was purchased. Joe had tried
for a long time to convince the owner to sell the domain but the owner
wanted too much money. Eventually he saw the owner of domain
checkin to a restaurant in San Francisco, he went to the restaurant
with an envelop filled with $5,000 in cash and made the owner a offer
he couldn’t refuse. The owner accepted and Joe opened his laptop and
transferred the domain to his account while they sat there.

Despite what you may think of Klout, Joe Fernendaz should be a
inspiration to all entrepreneurs, he is to me.

> Why did you start?

JF: In late 2007 I had jaw surgery that left my jaw wired shut for
three months. During that time I had to completely rely on Twitter and
Facebook to communicate. This experience really changed the way
Ilooked at these platforms. The fact that I could instantly tell the
people who trusted me the most my opinion on anything was amazing
tome. It was the realization that word of mouth was scalable for the
first time and even more exciting was the fact that the data was there
to measure it. I became obsessed with the idea of every person
understanding and being recognized for their influence and Klout was

> How did you raise money?

JF: I really struggled to raise funding initially. I started Klout in
2008 right in the middle of the global economic crisis. I had never
even met a venture capital or angel investor and had almost no
network. I built and then launched the original version of Klout with
my own money and then spent about 10 months hustling trying to meet
every interesting person possible to tell them my vision. I probably
pitched Klout more than 100 times before settling in with a group of
angel investors that were willing to invest in the company. The key
here was not giving up.

> What was the hardest part of building the company?

JF: When I first started and I quit my job and invested my own money
to build this it was terrifying. In my mind it was going to get a lot
easier once I raised funding. Then I thought it would get easier when
I raised my second round of funding. The truth is that it doesn’t get
easier. The intensity increases every single day in building a company
and being strong enough mentally, physically and emotionally to handle
that is a major challenge.

> Why is klout important?

JF: Klout is democratizing influence. Historically we have all been
influenced by the few who had access to broadcast platforms like the
media. Social media has changed this and now every person has the
power to tell their story and influence their friends, family and
connections. Klout is helping every person understand their influence
and make sure they are recognized for it.

> What was the most important step to growth?

JF: Klout has always been user focused. By providing the most accurate
and transparent measurement of influence available we have been
rewarded with compounding growth. We also launched a Klout iPhone app
back in April that has significantly increased the pace of growth for
the company.

> What do you wish you could have done differently?

JF: Startups generally are a series of mistakes where hopefully none
of them end up big enough to kill you. The big things I would do
differently next time is hire internal recruiting and design earlier.
Having the best people on your team and the best looking product makes
a huge impact.

> How do you view the Japanese market?

JF: Japan is our third largest base of Klout users after the US and
Brazil. The success of Twitter in Japan gives me hope that we too can
have a big impact in the Japanese market.

> Do you have plans for Japan?

JF: My hope is that in 2013 we can offer both a localized version of
Klout and start delivering Klout Perks in Japan.