Andrew McCollum of Philo is re-inventing television

onPhilo CEO Andrew McCollum

The Xfund- Philo relationship is a special one because it dates to the earliest days of both companies: Philo was the first company that Xfund supported, and Xfund was Philo’s first investor and has participated in every funding round. Launched by co-founders Tuan Ho and Nick Krasney at Harvard, Philo is the world’s first social television company.

Currently at the helm of Philo is CEO Andrew McCollum. For years, before he became CEO in 2014, he mentored and advised Philo’s co-founders and served on the company’s board. Andrew has also served as Entrepreneur in Residence at New Enterprise Associates ( NEA). He is an active early-stage angel investor and one of the five original co-founders of Facebook.

In our conversation below, Andrew shares Philo’s atypical growth path, why college campuses can be a great place to launch a consumer product, and Philo’s approach to DEI and culture.

What made Xfund and Philo a good fit from the beginning?

I think Patrick’s a smart investor, especially in areas like consumer products. There aren’t a lot of great consumer product investors in Boston, or at least there weren’t when Philo was getting started. It was really hard to raise money and build consumer companies there.

Although at that time Philo was largely selling to universities, the company viewed its real target user as consumers and assumed that it would grow into offering those services directly to consumers, rather than via a B2B2C model.

Harvard was Philo’s first customer and first launch site. With Xfund having this connection with Harvard and an academic focus in how it thought about investing, it made sense as a partner for a business that was trying to initially grow through launching TV services on college campuses. That was one of the bigger reasons why I thought Xfund was a good fit.

Xfund has participated in each of Philo’s funding rounds. What does it mean to have a long-term investor like that?

It’s huge — it’s really huge. Philo’s situation is extremely uncommon, because the plan for the company that was made on day one is basically what we’re executing on today.

It usually doesn’t happen like that, and not necessarily because your original plan is bad. It’s just that most of the time, when you come into contact with customers in the market, you end up adjusting your original idea.

But Philo had this plan of starting with college campuses, building the product, collecting data on what people were watching, building relationships with content owners, and ultimately transitioning to a streaming TV service for consumers outside of colleges.

That took a long time. When Philo got started, there was no way to launch a streaming TV service to the general public — period. The companies that owned the content wouldn’t license it in a way that would allow these services to be created. And the TV industry moves really slowly.

Philo started out as a tiny fish in a huge pond, with all these giant multi-hundred-billion dollar companies. From the point of Philo launching at Harvard, to us launching the public consumer version of the product, was about six years. And now the company has been operating for over ten years.

So it’s been hugely valuable to have Xfund committed and involved, and supporting Philo through its very long incubation and building process. Patrick has been super influential and helpful in building the company from the earliest stages, all the way to where we are today.

I’m pretty sure Xfund is the only investor who has participated in every round. We’ve had other investors who have stepped out and come back in later, when they think things are going better.

But having someone who is close to the company and believes in it, and is willing to support it over this long journey, across many stages and transitions — I’m hugely appreciative of that.

Philo’s co-founders, Tuan Ho and Nick Krasney, created their company as Harvard students, and you co-founded Facebook while you were there. Was that point of connection relevant for you?

I don’t have any kind of thesis that being at Harvard and starting a business that targets college campuses is a repeatable recipe for success. But it was funny — I understood why social networking would be so valuable on a college campus, but I didn’t immediately understand why it made sense for TV to be incubated on college campuses.

It’s not the most obvious thing in the world. But it clicked once Tuan and Nick explained that, because the rights were not available to do this anywhere else, there was a unique opportunity to create a streaming TV service within this university bubble.

Universities operate essentially as mini-cable providers on their campuses; they have a special set of rights and permissions to use the content in a pretty flexible way. So, to create a college-based streaming TV service, you didn’t have to get consent or contracts with content owners.

That was interesting to me, because it provided a way to build the product and technology we wanted to create, before it was possible to do it anywhere else. So, it did turn out to be funny that it was the same strategy as Facebook, but for a completely different reason. It was totally unplanned, but an amusing coincidence.

I feel like whatever business I do next is going to have to start with Harvard and grow through college campuses, because now I’m basically the world’s foremost expert in doing that!

It seems clear that there are benefits to starting a venture on a college campus.

Well, the one thing that’s really great about college campuses as a platform for launching consumer products is that there are few times in your life when you’re in an environment that is so small, connected, and all-consuming as college. The only other thing that really compares is prison.

That’s really powerful for lots of consumer products, especially social ones. It’s as if you have a container with gas molecules in it and you compress it, so those molecules are bouncing off each other all the time.

That’s what you have with a social product on a college campus. People tell other people about it. They’re using it. You get these really quick iteration and feedback cycles. And that’s a powerful way to figure out what works.

There are a lot of advantages to doing that. It’s not right for every company or product, but it is for some. It’s not just Facebook and Philo, but also Snapchat and several other companies that have started in that environment.

You have a particular interest in diversity, equity, and inclusion (DEI). Why is that so important to you at Philo?

It’s a huge focus for us. As a growing company, I think it’s always a challenge for us to meet our goals and aspirations around diversity, equity and inclusion, because we’re also focused on hiring great people as fast as we can. If you’re trying to also select for other characteristics like diversity and representation across different groups, that’s challenging.

Those two things sometimes work against each other. Say you have great candidates who don’t meet your goals around diversity. Do you pass on them, when you’re struggling to hire people as quickly as possible? That’s tricky to manage, but it is really important to us, for several reasons.

One, it’s built into Philo’s culture that everyone should be able to contribute, that great ideas can come from anywhere, and that a diversity of ideas allows you to make the best decisions and produce the greatest impact for the company.

Also, our company serves a very diverse customer base, so having those views represented within the company helps us serve our customers much more effectively.

We also believe that the mission of our business goes beyond making money. We want to have a positive impact on the world. So, providing fair opportunities to everybody, regardless of their background, is important. We believe that’s how the world should work, and we want to demonstrate that within our company.

I’m a believer that talent and ability is spread widely, and if you want to hire the best people, you should be looking to find them in all kinds of places. And if there are people who are not being given fair opportunities, you should look at that as an untapped opportunity to find great talent.

Culture has also been a focus for you at Philo, particularly in your approach to time off. Tell us about that.

The shorthand way to say it is we believe that the most important thing for us to do is to build a product and a company that people really love, because people generally don’t love their TV provider.

To do that, we need people who love working at Philo. We definitely are not believers in this idea that you should squeeze every ounce of work out of people, even if they’re going to get burned out. That’s just not our philosophy. We believe in putting people first, above profits and other goals, because that leads to the best outcome for the business in the long run.

For that reason, we have unlimited PTO. But we also realize that’s not enough, because it can turn into a competition as to who takes the least amount of time off.

We want people to take the time they need to rejuvenate and be able to do their best work. So we don’t just enable PTO — we incentivize it. We will pay any employee at Philo $1,000 a week to take at least two weeks off a year.

Aside from helping to make people feel comfortable taking time off, there’s another logic behind this. If you actually want to enjoy your time off in a way other than just not working, you have extra costs — plane tickets, your hotel, a dog sitter, whatever. That bonus allows people to make the most of their time off and really have a vacation. This is an atypical policy, but it fits with our cultural values.

Originally published at https://blog.xfund.com on January 9, 2022.