Having Connections with Patrick Lee

Today we are talking to Patrick Lee, one of the founders of Rotten Tomatoes, a review website for film and television. Eager to become an entrepreneur, Patrick didn’t finish college, but instead jumped right into the startup game. It took a few tries before he helped to found a successful company. Patrick and his colleagues rode the wave through a market collapse before ultimately selling for above their valuation. Building For Me, Not For Thee Patrick attended UC Berkeley and made a bunch of friends his freshman year. By his sophomore year, Patrick was too impatient to finish school, so he convinced three friends to leave school and do a startup. The four started off selling computer systems and components, but that didn’t go anywhere. They transitioned into web design for the entertainment industry, working for a lot of big names. They were doing quite well and revenue was growing quickly, but Patrick wasn’t interested in being in the service industry. He didn’t like building what clients wanted him to build, he wanted to build what he wanted to build. It also struck him that they weren’t building anything they owned. It was about this time that the company’s creative director came up with the idea for Rotten Tomatoes. They Like Us, They Really Like Us The team saw their other friends raising a lot of money, building up a business, and then selling it. Patrick knew it made more sense for them to do something that was theirs. They incubated the idea for a year before officially launching it, but when they did, it took off. Yahoo would feature them and bring in traffic, a famous film critic would include them in his article about the best movie websites, bringing in more traffic. Finally, Pixar released a Bug's Life and sent a lot of traffic to Rotten Tomatoes. Even Steve Jobs was a fan, mentioning Rotten Tomatoes in three separate keynote speeches at Apple. All this early success told the team that they had stumbled upon something great. Knowing What You Know Now, What Would You Tell Yourself Ten Years Ago? Patrick says he would tell himself to build a network. He says having connections to go to for advice can make a huge difference. He believes that had they had that network to help them gauge the market, they may have ended up in a position to sell to Google. What Patrick Is Working On Now After selling Rotten Tomatoes, Patrick went to China to work on a new startup with a friend. He says that company didn’t go anywhere and that they tried two others that didn’t take off either. Coming back to the US, Patrick tried his hand at creating a mobile game but found that the cost to acquire users was more than they could make off of those users, so it just didn’t make sense. Feeling burnt out on startups, Patrick spent some time just doing speaking engagements. He ended up running a group for notable tech founders. Two of those founders approached Patrick about doing an investment syndicate. If you’d like to connect with Patrick, he can be found on LinkedIn or Twitter @rottendoubt. -- The Exit—Presented By Flippa: A 30-minute podcast featuring expert entrepreneurs who have been there and done it. The Exit talks to operators who have bought and sold a business. You’ll learn how they did it, why they did it, and get exposure to the world of exits, a world occupied by a small few, but accessible to many. To listen to the podcast or get daily listing updates, click on flippa.com/the-exit-podcast/