Today's interview is with Derek Johnson, founder of an angel-funded startup, Tatango (www.tatango.com), the latest incarnation of Derek's firm networkText. Tatango is an instant messaging service focused on connecting groups together, which recently launched a public beta of its services. The firm has scored funding from the Bellingham Angels. Tatango is based in Bellingham, Washington, which is about an hour outside of Seattle.
What's the idea behind Tatango?
Derek Johnson: The idea was originally to connect groups via mobile with members. So, for example, is you can send one text message and it bounces out to every single phone in the group, which is effective for group meetings, reminders, and things like bill notices--any purpose you need to get messages to a group through everyone's mobile phone. The site is the latest incarnation of networkText, which was a web site we launched earlier. We started at 2000-3000 messages a month, then it started ballooning to 4-5 million text messages a month, and we had a hard time scaling. In addition, our user interface was really confusing, since we'd built it in our basement as college students. So we're relaunching the company with a new user interface, new features, and a much easier website for everyone to use.
Talk about the story on how you originally came up with the company--where'd the idea come from?
Derek Johnson: I was having lunch with a friend of mine, who was in a sorority. She was complaining about all the nuances of communicating with that sorority. She's tried email, Facebook, and phone trees, and nothing worked for them. I came up with the idea to find somewhere you could text message all of the girls at one time, and she looked at me and said that would be perfect. I told her I'll go back and Google to see if there was anything like that, and didn't find anything simple or easy to use.
You were telling us you have some angel funding for the company?
Derek Johnson: We started the company in college, then we raised a round of funding from friends and family. We decided to give this a shot, take three or four months, and see if this is something that would be worth doing. I took off from school for one semester, working from my parents basement. Within a month, I figured out that this is going to be huge. I then started going out and looking for capital. We raised funding from the Bellingham Angels, which is an angel group.
What were you studying during college when you started the firm?
Derek Johnson: I went to the University of Washington, but then I got denied to the business school there. I took some time off, and applied to the entrepreneurship school at the University of Houston. I transferred to the University of Houston, and spent a year there before I came up with the idea. I decided to drop school, and focus on the idea. I've owned a couple of businesses before--a landscaping company, which I sold--and have always had the entrepreneurship bug. A really big bug.
Where you are now with the service?
Derek Johnson: We launched into private beta on July 15th. This web site is really taking all the best parts of networkText, and combining it with a new user interface and lots of new features. College groups, and anyone else can create a group on our site, it's extremely simple.
What's the business model behind the site?
Derek Johnson: The business model is a three-tier business model. One is advertising--which is placed at the bottom of each message. Those ads are for ringtone companies, movie theaters, or just general products. The second is we have a subscription model. For $4.95 a month, you can upgrade to a Tatango pro account which allows you to remove the Tatango branding from your text messages. The third is that you can add additional features to your account, such as keywords and additional groups.
How big is the company now?
Derek Johnson: We've got six employees on staff, including two developers and one designer.
Are you looking for more capital?
Derek Johnson: Yes, that's what we're doing now. We're looking for another round of angel funding, which is what I'm spending my time on right now.