Today, David Sacks is a titan of tech, known for his sharp takes on the 'All-In' podcast and his Midas touch at Craft Ventures. But long before the billion-dollar exits and public profile, he was just another first-time founder.
From PayPal COO to Founder
In 2002, David Sacks was
on top of the tech world. As the Chief Operating Officer of PayPal, he was a key member of the 'PayPal Mafia' that steered the company to a $1.5 billion acquisition by eBay. After a few years that included producing the film 'Thank You for Smoking', Sacks was ready for his next act. He wasn't just looking for another operational role; he wanted to build something from scratch. The inspiration wasn't just professional; it was personal. He drew inspiration from his grandfather, who had started a candy factory after immigrating to South Africa. In 2006, Sacks launched his first company as a founder: Geni.com.
The Grand Vision of a World Family Tree
Geni's ambition was enormous: to build a single, collaborative 'World Family Tree'. The idea was perfectly timed for the Web 2.0 era, which championed user-generated content and social networking. Users would start by adding their immediate relatives and then invite others to collaborate, building out a massive, interconnected genealogy database. Sacks was drawn to products the 'whole world can use' and that could spread virally, a lesson learned from PayPal's explosive growth. Geni seemed to fit that mold perfectly. The initial buzz was strong, and the company quickly attracted users and funding.
The First-Year Grind
Despite the promising start, the first year was a grind. While the concept of a single, collaborative family tree was powerful, it also created unforeseen problems. Users clashed over control of profiles, with some complaining that others could alter their meticulously researched family data. Accuracy became a significant challenge, as incorrect information could be duplicated across the shared tree. While the site grew, achieving the kind of seamless, viral adoption Sacks envisioned was proving more difficult than expected. The core product was a social network built on a complex dataset, and the social dynamics were messy.
The Accidental Pivot That Changed Everything
The true 'untold story' of Sacks's first year as a founder isn't just about Geni's struggles; it's about what was born from them. To manage the growing Geni team, which was split between Los Angeles and San Francisco, Sacks and his engineers built an internal communication tool. It allowed employees to post status updates, ask questions, and share information efficiently. They soon realized this internal tool was, in many ways, more compelling and had a clearer path to viral adoption than Geni itself. It solved a universal business problem. In 2008, this tool was spun out into a new company: Yammer. While Geni continued to operate and eventually became profitable before being acquired by MyHeritage in 2012, Yammer was the breakout success.
