Katie Perry (00:00):
I'm Katie Perry and this is After Earnings, a show that brings you face-to-face with the executives behind the world's most interesting public companies.
Austin Hankwitz (00:07):
And I'm Austin Hankwitz . And today we chatted with the CEO of Life. 360 Chris Hulls. Yes. Life 360. The app your parents used to track your location and everything you were doing when you were younger. Now Chris was such a breath of fresh air. He actually rolled up to the interview holding a seven 11 coffee cup. He broke down his strategy for infiltrating TikTok and how he got 7 billion views on a hashtag and he just kept it a buck with us the whole time. On a serious note, we learned more about why they iPod on the A SX years before now trading on the nasdaq, the company's core values. We've learned a little bit more about members before metrics as well as how they morally sell. De-identified aggregate data to help with traffic jams.
Katie Perry (00:52):
That's right. We definitely talked about monetization. Just 13% of life 360 users are paying subscribers. The rest are free users. And it's interesting to think about teens on the platform now, perhaps reluctantly. So someday having their own life, 360 accounts for their families and being paying subscribers. Chris also tells us about being a rule breaker as a CEO and how joining the military at age 17 helped shape him into the leader he is today. So let's get into it. Chris, welcome to after earnings. It's great to have you here. I spotted a seven 11 cup and I want to ask about that before we get into the interview.
Chris Hulls (01:32):
This is the best coffee. As I've gotten older, I'm going to go way off topic. I was in college, I was going to the symphony and stuff and I thought I'd get smart. I was like, you know what, I'm just not a cultured person. So the seven 11 is not only cheaper, it tastes better and it's bigger. So there you go.
Katie Perry (01:48):
That's how I feel. Do you listen to country music? Do you have a lot of Carhartt?
Chris Hulls (01:55):
I am on my rural property now and the funny thing with Carhartt is some people Are you trying to be cool Chris? No. Well you're wearing Carhartt. That's cool now. And I guess it is, but I am in a small town, a few hundred people that were ranching town and it was all the rednecks were Carhartt now it's completely changed.
Katie Perry (02:17):
Well they bifurcated the brand so there's more expensive Carhartt they sell in soho, New York. And then there's the actual work wear. Anyway, we're getting way off topic, but welcome to the show. We want to talk to you. You recently IPO'ed talk about Life 360 and to get going, I read that this idea, the spark of idea came actually after Hurricane Katrina. So I would love to hear sort of how that seed of an idea came about and then how you built it.
Chris Hulls (02:48):
Sure. So the idea was Hurricane Katrina, I was still in college and it was obviously a huge tragedy and families just couldn't find each other after a big emergency and cell towers stayed up, all landlines went down and I had the idea what about actually using text messages to help people find each other after big natural disasters? Wasn't planning on working on the idea. We can get into the story about how I decided to pull the trigger later, but we were seeing the smartphones were just about to come out. iPhone was out and Android had just been announced there were no third party apps on iPhone. What if smartphones could be the way of knowing where people are? And our initial idea was very emergency focused, but when we built our prototype, which was lit an emulator, there wasn't even an Android phone yet. Like wait a second, this could be something so much bigger and it just made sense.
(03:35)
Sharing location is extremely powerful. It's really a fabric of communication and I didn't think it's creepy. One thing I've never cared about social graces or anything, it was like we just seemed like at some point this is going to be completely normalized and it was the era of social networks for everything. And our thought was maybe the way to win the family network, which many people were trying to do isn't like another photo sharing app or even organization service. What if it's around communication, coordination and safety? And if everyone has a smartphone, that's a really great way to do that. Ironically, I'm veering off a bit. The number one reason most VCs would pass on us in the early days was that teenagers would never have smartphones. Go figure.
Austin Hankwitz (04:14):
Wow, that's a crazy assumptions. I mean I get it right? I remember back when the iPhone came out, my uncle had it and he was super, it's called him forties in his fifties. He was much older than me. And for reference there I was in I think seventh or eighth grade when the iPhone came out. None of my friends had smartphone I don't think until really actually I remember the iPhone six took my high school by storm and that was, gosh, 2000, maybe 12, 2013 there. But then after that I feel like everyone's kids already kind of started rocking into that. So what a wild assumption and crazy to see
Chris Hulls (04:50):
How it was a Bill Gates quote that people underestimate the change in one year or overestimate in one year, underestimate in seven. So most of these big trends, they're only obvious in hindsight. And you got to take many swings and misses. Think of all the things that we thought would be huge that haven't really panned out yet and can see where the world's going to go though.
Austin Hankwitz (05:10):
Well speaking of a swing, not a miss, more of a home run. You guys just iPod. You guys are now on the nasdaq. You were private for more than 15 years. Why now? Right? Why from private for so long to this?
Chris Hulls (05:25):
So the only big difference, we've actually been public for five years on the A SX. So we've always done things a little bit weird in our own way. So we have been, for all intents and purposes of public company, been legally for the last five years. So the why now for the NASDAQ shift though was we're a US company. This is the right long-term home for us. We had a bit of a Goldilocks situation with our share price, not too low that we couldn't take some dilution, not too high, that no reasonable investor would invest. We can look anyone in the eye and pitch a really good upside story. This is a ubiquitous use case. Yes, there are risks, but it's actually going from when people bring up like, okay, what are the risks? It used to be like, well the market's too small, no one's going to use this now the market is so big this is going to be is by every person in the world, the biggest companies in the world.
(06:11)
You want to do this, how are you going to compete? So I think it's a much better position to be the risk point being your market's too big than too small. So on that note, we want to have access to the deepest pockets when the market does shift back to a growth mode, doing more m and a is definitely on the table and it's the right long-term home and we've always been very under the radar for our size. And so being on the NASDAQ does I think come with some credibility for prospective employees. We're very focused on the absolute best and brightest for the team. And when we were on the A SX or private, it was like it doesn't really give you that same cache and there's probably some very small element of ego to it, but we really want to be recognized as where we are. We're the 14th biggest app in the country by DAU and we want to get even bigger.
Austin Hankwitz (06:56):
No, I love that. And walk me through why you guys chose the A SX five years ago versus the NASDAQ and give me the whole play by
Chris Hulls (07:04):
Play. So backing up a bit, we were not an overnight success. We were way, way, way too early to the location trend better early than late. And it was both the attitudes around location sharing and the technology to make the app actually work well. So to your point on iPhone six, there's a little bit different thing happened with us. I'm going to get the generations a bit wrong. Like early location apps just kill your battery. Even if the absolute best engineers, there's just no way you could do it. When they moved to on ship accelerometers and just better chip sets in general, everything opened up. So the ability to detect a car crash from the sensors on the phone, that was all like you needed the on ship accelerometers to do that without clobbering your battery. So when it tipped, it tipped hard. But as a company we had a bit of a messy cap table.
(07:49)
I had no clue what I was doing when we got going. We had some strategics on the board we wanted to shift off. We had some early investors that wanted to get some liquidity and at the time the A SX was pitching instead of doing a series D or E, come here get the benefits of being public a little bit earlier. You can be a big fish in a small pond, get rid of the preference stack and I guess they run a safety company so it shouldn't be that surprising. I like to hedge a little bit and I didn't like the idea of I was a little suspicious of companies with these huge headline valuations, but then you'd look at the underlying structure and it would be like two x participating preferred and you could get these wipe out situations. And so up through the end of 2021 that conservatism did not pay off.
(08:30)
But there are a lot of companies now that say you're a founder or something and you only sold $300 million but you had raised 300 and maybe you had moved on, you got zero. And so we wanted to hedge against that downside and the valuations between the A SX and the US markets were very similar. We only had about 30 million of revenue I think. Don't quote me on that at the time. So way too small. Now we're over 300, so we're literally 10 x the size. When we started that process, it's before SPACs were a thing. But unlike SPACs, the A SX, it was like a real IPO. Now that I've done two borders across border IPOs, in some ways the A SX process was more rigorous than the US one. So it wasn't like a hack where you can kind of put lipstick on a pig and get it out. It was a way to go through that rigor a little bit earlier and get the benefits of it.
Austin Hankwitz (09:21):
That's awesome. I appreciate that breakdown Chris.
Katie Perry (09:24):
Yeah, the A SX is super interesting transitioning to nasdaq, especially in the context of our listeners retail investors because a lot of them today are actually learning about and discovering companies through their brokerages first and many of the brokerages don't offer non-US equities on there. And so do you think that's going to be a spur more retail investor interest just through pure discovery ability?
Chris Hulls (09:50):
I think so. And somehow we had some OTC listing that even our lawyers didn't really know how that ended up there. So there were people doing an OTC trade and if you guys know how that all works, tell me. But yeah, we have a lot of people doing it. We do have a surprising TikTok falling where Gen Z people are always asking how to buy shares. I hate you but I think my parents love you so much that this stock's going to go way up. So I don't know, should we try to meme stalk ourselves? I guess we could.
Katie Perry (10:16):
I mean for sure we appreciate the creativity. I think that's what this next generation of investors is looking for and it is, we talk a lot on the show about how it's kind of more marketing than I are and it seems like that's where your head's at.
Austin Hankwitz (10:31):
How much are you guys spending per year I guess to ensure that the sensitive data that you're collecting and sharing with your customers is always going to be protected, right? I know Apple call it maybe four or five years ago they switched to Apple privacy. That was a big marketing thing for them. Talk to me about the process around making sure that the data you collect and share with your customers because they want that data is entirely secure. So
Chris Hulls (11:00):
Let's zoom out on data and privacy in general. I think there's what do we share just from forgetting about security but more just what we feel comfortable with our partners and all that and our working philosophy there is transparency and choice. We try to have plain English and tell people how we use their data. We think data can be used in good ways even though it can be negative spin. Like one thing I'm really excited about is with people's permission, let our driving data rate your insurance. If we're like, Hey Austin, you're in the top 23% of drivers, you'd be crazy not to have a usage-based policy. That's a really good use of sensitive data. We could even warn you like, Hey Katie, you speed all the time. You actually probably don't want this. So we'd like to get to a point where we sometimes with partners in a very customer safe way can use your data to enhance products and services.
(11:49)
You get tying that into a little bit of an investor theme. We really looked Credit Karma a lot. They're taking your absolutely most sensitive data. It's like you give them their social security number, your full name, your birthdate, everything to steal your identity. What do they do? They share that with advertisers, but it's not in a bad way. They do it by matching you with the credit cards that are actually good for you. And because it's giving you value, people feel very comfortable about that exchange. So when you think about data, we are a pro data company. When it's done in a transparent way that gives users choice and I will never do anything to our customers that I wouldn't do myself. So I'm opted into everything in life 360, I like targeted ads. My joke, which is not really a joke, is they're great.
(12:31)
I get ads that I like, but if my wife's been using my computer, I get targeted with yoga pants. Now I have two daughters that are getting old enough to use a computer so I'm starting to see other weird ads. But anyway, I think target ads are good. So that's nothing to do with security. The security piece though is anything with payments is the stuff that's actually most sensitive. That's the stuff, there's real dollar value. Location data obviously is very private, but again, you can't just get a phone book and find where someone lives. There's not actually a lot of financial value to a hacker, which is really where they're going after where can I get your, if you're a crypto company, darn well better protect those keys with your life. So we're more of like a PR thing and people take swipes at us because some people think we're the evil empire, but there's not a financial incentive there.
(13:15)
Outside of payments with payments for PCI compliant, the vast majority of our revenue comes through the app store and that is going right through Apple and right through Google and they're obviously mega mega secure there. So we don't actually have any financial payment information for our customers at all. So that makes us pretty safe on that front. One good thing about our system is the data set is so big you're getting, don't quote me exactly, I think many billions of location points per hour. So if you're a hacker and it's just trying to drain our systems, the API volumes are so high. It's not like a teenager in a room can just go after someone unless you got someone's keys, you were going to notice it. So observability, it's actually easy for us because versus a system where you're getting little bits of data here and there we're like a massive pipe.
(14:07)
So to make a plumbing analogy, like a slow drip that could run for days in your house and then you only notice when your floor gets soggy, if your main burst, you're going to know instantly. So in an oversimplified way, observability is usually easy for us in particular around the things that could be more sensitive such as location because that's the huge pipe. And going back to that earlier instance, it seems like there was some drip on customer service where you could get an email back but it was not, if it were the sensitive stuff, it would be very easy for us to see.
Austin Hankwitz (14:42):
I think it makes a ton of sense. And something you mentioned, Chris, was sort of these marketing ad placements, things like that, targeted ads in your form 10 K sort of your annual report. For the listeners that might not know that term at the top, I think a couple pages down really you've got something called other revenue and other revenue for the last three years has been around this sort of 25 million a year range and it's defined as revenue you generate by selling non-identified user data as well as ad placements. So I'm curious who's buying this non-identified data and do you have any examples of that? And is it all just ads? Is that all it is? Sure. What is this data that's generating you guys?
Chris Hulls (15:28):
25 million a year. It's aggregated data. And that might sound like a trivial distinction but it's actually a big one. So we were using broader data sets to help third parties do things like targeted advertising where it would be de-identified in the user level. We no longer do that, we never had any issues with it, but it did become something that many of our customer, well actually a very small number of our customers, but the general sentiment shifted there and so we thought, you know what? We don't see any problem with it. Going back to my, I was opting into all this stuff, but it's not worth, we don't want to do anything that gets in the way of our brand around trust because if we lose the trust of our customers, we're in a lot of trouble because you're trusting us with your family safety.
(16:13)
So what we moved to was aggregated only that means even the partners that get that data could not find out who you are, even if they tried and you can get very esoteric, what about this or that or the other. You really can't offered for anyone to look at the dataset, try to tear it apart. You will not find who these people are. Anyone. So I'll give you one example. We aggregate on census block. So we have a company partner, we have two exclusive partners. One is placer.ai and the other one is Ity, which is an Allstate subsidiary. Placer is doing things like aggregated insights. So down to the census block levels like in your census block people go to McDonald's and seven 11 they will only give insights. And you have, don't quote me in the exact numbers, but I think about 50 people in the census block.
(17:03)
So there's no GPS lines or trails and that data is purchased by city planners, hedge funds, mall operators, billboard planners. So they're not attributing to a user level with arity, it is an Allstate subsidiary On the aggregated basis they're doing probe data for traffic. So if you get in driving directions in an app or your car, it's giving you traffic. Where does that traffic come from? Probe data like us, but we're not getting your GPS line. It's saying this intersection had these probes going past it and we have 13% of all phones in the country running like 360. So people not surprised to hear that these really nice navigation ets, a lot of it is coming from our data, but again, aggregated not de-identified because still has an individual full line essentially, but stripped out their name. We don't totally. It's like, okay, tell me what's happening in this intersection right now. And again, I'm giving an oversimplified version with Arity though, what we are trying to do with user permission is full opt-in consent so you can get insurance rated, but we will never do that without your permission. And I think that's sometimes misunderstood, sometimes even unintentionally by reporters that I think want to take swipes at companies that use data. But again, transparency and choice and out the gate it's aggregated data, which is from a legal standpoint, not even a data sale. Even Apple does that.
Austin Hankwitz (18:32):
Kind of unrelated here, and I didn't even write this note down, but I've heard of this and I'm curious what your thoughts on the idea of a data dividend, right? It's like opt-in to share your traffic data, how often you go to McDonald's, right? Because you guys are using that to generate all this money. Have you thought about passing that
Chris Hulls (18:49):
Down to the user? I about so much because people say that and it's like where do you want me to send your 62 cent check? Do you want your 62 cents? It's people think, oh my god, these companies are making so much money off my day. That's like we're kind of picking up the pennies here. Not that's bad. We have 60, but I've actually not done the math on an MAU basis. We have 60 something million customers, we have 20 million, so we make 33 cents a year per customer on our aggregated data. Okay,
Austin Hankwitz (19:24):
I get it, I get it.
Chris Hulls (19:26):
So I don't know if that's a very compelling pitch to get 33 cents off premium or something. Where it does change though is where we want to actually give value is when we do the really detailed stuff like insurance because people pay a lot for that. They're really esoteric rules. You can't do rebates legally for insurance, but that is where I think we can pass stuff back to customers where it is sensitive data. But again, transparency and choice and one thing I think Apple has been helpful with and it was people were surprised is that the whole, the popups, they do give permission for this app to track you across websites. More and more people actually saying yes to that because I think they understand that targeted ads are good and so let's not make a value judgment around it. If you want targeted ads, click yes. If you don't want targeted ads, click no. And there's a little bit more money when you can actually do that attribution. But I, I'm trying to think how the data dividend would work because if you do the math on really any company, you're not talking about a lot of money. Have you actually heard of people put a bigger business model behind
Katie Perry (20:30):
That? There's a browser called Brave and it's tied to crypto and the thesis is you engage with ads proactively to earn this dividend, which is similar, but it's also, I think the flip side of that is are people in the headspace of just trying to make money and not actually engaging with relevant ads? That's one example
Chris Hulls (20:52):
I've heard. I think that's a bit different because you're actually engaging in the ad and signing up for free trials and that stuff's been going on since the nineties and so I'm the cheapest person, especially when I was younger. So there was this one thing, you click on ads and offers and you could get, I got a free DVD, those portable DVD players in the nineties. I got one of those by quickly on 20 ads and getting points and there was, I also remember a nineties company, right when you got the internet you could get free dial up if you had a permanent banner. Do you remember that? Well you guys are too young I think.
Katie Perry (21:21):
No, I think I'm closer to your age Chris and I forgot about clicking all the ads to get free stuff. I was a thousand percent doing that so
Chris Hulls (21:31):
Very, I was there with you. That's an active affirmative step. You're giving someone a credit card and signing up for a trial, very different than exhaust data, which it is. You're collecting lots and lots of pennies over millions of customers. But that's going like I'd love to toss stuff back to our customers if we can. Insurance, there are weird legal things around that. But yeah, if someone's actually signing up for a trial or something, then yeah, for sure that's where there's real dollars and not the question you asked, but when we've looked at launching ads, I think the market has maybe oversimplified the ads opportunity in the short run but underestimated it in the long run because we do with your data, with your permission, we can really target some pretty powerful life events and help you when you go to a new school, get a new car, get a phone, all these things are moments where there's significant purchases happening.
(22:28)
And I would love to give people offers, Hey, welcome a new neighborhood and here's a discount on home security. We could pass a huge chunk of that back to our customers and if this is coming from Life 360 which and trust, I think that's very exciting. But that's going to take a while to really get those hooks in place because I think the leap from this to this dull banner to a real offer that's valuable is a lot. And you also, it's not just the offer, but how do you build up that trust and awareness? I think as we all know, the vast majority of banners like, oh, you can save up to 37%. Like no, you're just giving me a BS ad. So how do we build that trust where it's like, no, hey Katie, here's how you drive, here's your driver's score. Don't opt into this until it's good. But when it's good like man, this is going to help you. That I think is going to be really powerful, especially if our customers trust us that we're being smart around actually telling them ahead of time how their data is going to be used for or against them and if it's against them, don't do it.
Katie Perry (23:26):
So shifting to your audience, I know you have a hybrid sort of audience where you have paying members, you have free members. Can you break down what are the paying members getting? What are the free members getting or not getting and how does monetization work across all of those things? Sure,
Chris Hulls (23:41):
Let's just take us only for the moment. Eventually it'll all be international, but just to simplify, so the core free experience, you get almost all our location services for free. We put a few paywalls up, but we really wanted to be the disruptor, not the disruptee. So we are pretty liberal around what we give our customers and you also get some very basic driving features for free and things like an automated SOS, an automated crash detection system where we get in a crash and we notify your family. We don't call 9 1 1 for you. So it's kind of like the free version's, kind of like what Apple does, the paid version and most people get our gold tier, it's much broader. The anchor product is what we call driver protect roadside assistance like AAA reports on how your family members are driving and human assisted crash detection like OnStar.
(24:24)
Beyond that we offer emergency travel and disaster assistance. We have identity theft protection, dark web monitoring, it's a stolen phone protection. So it's a pretty broad membership right now that is very focused on families with teens. The goal though is how do we have different services for all life stages over time? So from the time you don't even have kids to aging parents life 360 wants to have a service for you. And the really exciting thing about our model is we grow word of mouth. So we have a very low marketing cost in most products in the safety space, marketing is their number one cost and we just don't have that. So if you lure to take everything you get in our gold bundle or platinum bundle, which also comes with a few tiles, it would cost you probably literally 10 times as much to piece those services together individually.
(25:08)
And we can do it because we have mobile economics, we have this great interface that we can naturally stack everything up into and over time that's going to expand. So I think it's 13% of our US customers are paying us right now. We think that can probably double over time. So 30% and if you think about how that can ramp up our revenue, if we double free users, we've doubled revenue 600 million if we double percent of people pay us, we're at 1.2 billion. If we can double how much money we make through things like using your data and privacy safe and opt-in ways doubled again, we'd be at 2.4 billion. So that's how we pitch the upside to investors is a lot has to go well for that to happen, but it's not any crazy step function. Also, not the question you asked, but one thing that's a bit of a misperception around Life 360 is that our users are all families with teens.
(25:55)
In fact only about in the mid or high thirties of our percent of our customers have teens living at home. Paid use is a bit different. It is more than half are that stereotype people have of us, but it shows we have the user base, it's already kind of there from cradle to grave and we have these very natural plugin moment and I think we have been the tortoise not the hare because we've yet going our user base are growing bigger and bigger. We're not a victim of our own success in a way that the dating apps, which is an interesting come for us are
Austin Hankwitz (26:25):
I love that and to the point of do things that cradle to the grave, I like that because on one side of the equation, you're completely right. Everyone on the internet thinks that this is the helicopter parent teen app that's going to make sure that you're not speeding, you are home when you need to be home, whatever it is where I'm on the opposite side of the spectrum, my dad's almost 80 years old and I'm thinking about now using Life 360 as a way to get a better handle on how he's spending his day-to-day activity outside of the house. So talk about that a little bit, especially as it relates to all these baby boomers. I think it's what 4 million baby boomers turn 65 every year, sort of the silver tsunamis around the corner. So
Chris Hulls (27:06):
Talk to me about that. The opportunity unfortunately comment on that very personally because my mom is early to mid stages of dementia and not surprising it runs in the family happened a little bit earlier than I wanted, but my mom has been a life 360 user in the beginning and she also didn't get the product at first, but then as soon as she used it, she just became a huge fan. But now that she's had these cognitive issues kick in, we were watching her drive and it's like, oh man, we might want to take the car away. And we actually brought the life 360 driving reports to the neurologist and we had the neurologist report my own mom to pull her license. So that's one use of it. But when she was in this Twilight Zone, it was very reassuring to know that if something were to happen while she was on the road, we would get notified and it was that tool to have that conversation.
(27:56)
And now we use the product to make sure she's home at night, she walks around. Unfortunately it's not there yet, but you can see in a few years unfortunately it's going to get worse. And we have plans with the software and hardware features for seniors. So think about the software feature for seniors at home. It's not hard. Day one was the phone last active for a team. Last active was going to be like three seconds ago, but for a senior they got out of bed, they used the phone. That's a really good indicator how many steps they're doing tap into the health, how's their gait, fall detection. And then we own tile and Geo Bit doing a senior care product's really not that hard and it's a terribly antiquated industry. And so we think we can win from a product standpoint and just an acquisition standpoint, seniors love Beyond Life 360 because it doesn't feel like they're not part of the family and we're just going to be better at products. It's been these really old school, more marketing focused companies that dominated the space. And we've also really how we built the interface of changing topics a little bit and maybe to the misperception people have about us. A lot of our competitors early on were intentionally helicopter parents. I remember we had this one competitor, they called themselves Mama Bear. It might still something. Oh my god, you guys branding is horrible.
Austin Hankwitz (29:09):
Oh my
Chris Hulls (29:09):
Gosh, I was just laughing about that. That is so weird. But there was the kid version, the parent version, and we have always been, there is no kid version and parent version. We treat people as peers on the system and the funniest stuff, it's usually the kids actually telling the parents they're driving too fast and we have things like bubbles. You can hide yourself from your family and you have to pop the bubble in an emergency and you get all the safety features with the privacy. So I've been on TikTok telling teens how to break the app. So we are fully opt in every time we've had requests for mention, can you tell me the kid's uninstalling? Can you lock down? It's like, nope, go to a different product because we knew the big win was being something that everybody wants to be on and we had a thesis which was proven, which is like locations just fade to the background if it's used appropriately. The thing that went even further than that, which I'm a little shocked by and is probably not good for society is the Covid kid generation or the teens that were locked down for the last few years are now getting their freedom. They're the ones bringing their parents into life 360 that I'll admit I never thought would happen because they're so used to that mommy daddy being right there.
(30:27)
It's crazy to me. So I think there is a problem of kids needing independence, but we're genuinely, we want kids to have more freedom. And I think most people think it's corporate speak, but look at our numbers. It's not when people use the product. Oh, I get it. It's actually, it sounds like Austin, you're using it with aging print. It's not a tracker tool. Yes, we've had over a hundred million downloads. We've heard every example known demand, but on average the people who stick, the people who engage, they're not using it as helicopter parents or people tracker control people.
Austin Hankwitz (31:00):
Yeah, because right now I've got what the find my iPhone. It's the only way I'm tracking. My daddy wears one of those necklaces or something, but all I get is a text message if he clicks it and it's from this automated, who knows what happened. So I don't know. I think that's a really cool opportunity and I'm eager to see how that grows for you guys over the future. Shifting gears here away from the financials and sort of the numbers is I want to talk a little bit more about your leadership style, your company's core values. One of those core values is members over metrics.
Chris Hulls (31:32):
We want to start with how does this benefit members before we hit on what metric it's moving. And that's been an extremely tough thing to instill, especially if we've gotten bigger, especially being public. The financial pressures are immense and the short term thinking is a real thing. And I think most companies lose sight of if you build a good product, if you care about your customers, a good thing will happen because like, oh, we're up to a quarter, our back's against the wall, we're making trade offs and hey, we make tradeoffs all the time. I do not give us an A on that value. I give us a B at best, but every day we want to be coming in fighting for customers and really thinking, is this the right long-term move? Let's make sure we're not optimized local maximums. I'm not sure we're just prematurely harvesting customers.
(32:24)
We want people to feel like they're getting a good deal. I'm probably a little bit of a purist and so I let the team push me a bit, but I think it's game over for a business like ours. If we lose sight of we're a product company and we're a free product company and we're going up against free alternatives, now we have to be that much more delightful. And again, haven't been perfect, but we've been better than most. And I think that is why we have excelled in the category, especially early on when we had some competitors that weren't as obsessive of just this thing cannot break, it has to work. Every bug must be hunted down. If we see a battery report of killing a battery, we need to figure out why. So it's tough and it's exhausting, but it's important to us.
Austin Hankwitz (33:07):
I think that's amazing and it speaks volume to why you guys now have over 2 million paid members. I mean it certainly exceeded Wall Street's expectations. I think they weren't expecting you guys to hit that for a couple more months. Thank you. So congrats on that awesome achievement.
Katie Perry (33:22):
Want to shift to TikTok and teens, which you alluded to and something we've talked about on this show, just the influence of young people in online channels. Actually one of our first shows we had the CEO of Celsius on, they recently are under some fire because there's all this misinformation on TikTok saying there's cyanide in the drinks. And I know you joined TikTok as a result of some sort of campaign against you. And I just want to hear about that experience, what you learned from it and how you're using the platform either as a leader or a company now to sort of get ahead of that influence.
Chris Hulls (34:01):
So to back up, I was at a friend's house and had teenage kids and are you the TikTok guy? I'm like, whatcha talking about? No, I don't have a TikTok account. No, you're the TikTok guy. And they pulled out a video and there was a meme of people searching for creator of Life 360, they find me and they pull out a knife and printed beat me up. I'm like, oh geez. So I was like, okay, this is going kind of big. And that was a hundred million views. And at first it was a little bit nervous because all it takes is one crazy person who doesn't get that it's a joke. And that was okay. We just ignored it. And then there was an account that they were trying to do a one star campaign and spread the false rumor that if a app is rated one star, it's pulled off the app store.
(34:43)
Anyone who can do average masses, it's impossible to have a one star rated app, even have a single five star because all it takes is one. So it was just not true to begin with and we got 300,001 star reviews in a day. But instead of being all upset about it and we are legal team, we're like, we're going to sue everybody or whatever. We just like what if we actually reach out to the teens and try to befriend them? And of course we were big enough to have corporate antibodies. I was told why that was a bad idea. What's the downside? So we actually found the teens, they didn't reply to me on TikTok, they replied to me on Twitter and I just actually congratulated them because I wasn't mad. They're 16 and I probably did way stupider stuff when I was younger. And that actually turned out they didn't really even dislike Life 360.
(35:32)
It was kind of funny. Yeah, their parents would be a little over the top with it. And it was during Covid, nobody was sitting home. So we said, why don't we just team up? And I kind of gave the story. I think people assumed I was going to be some very stodgy, much older person. I'm 40 now, so it was my mid thirties when this all happened. So not a teenager but not an old man either. And I, I've been the biggest rule breaker my entire life, which also surprises people. So I thought, why don't we kind of just go out there and be really self-deprecating, maybe this whole fake story that I got fired by the board and I was going to try to be a teen influencer. And once I put on a little belly shirt and tried to did T-shirt tie dye and I let my hair grow out, I was depressed in theory and people bounce back and forth of actually believing it and people believe everything and it was just funny.
(36:21)
But I just made a fool out of myself by design. But then we did do a hashtag challenge when TikTok still hadn't gotten huge yet. We bought the homepage of TikTok, I think it was like 300 grand, which is a lot of money. But now to buy the homepage of TikTok is probably some crazy amount of money. But we announced the launch of our bubbles feature. We called it ghost modes. You could swipe meet a filter, you could swipe and disappear. So like look, we want you to use this for freedom. We've made a feature that you can not share your location, but it's there for safety and essentially blame your parents. So they use it poorly, but don't blame us. And if we go away a company that actually doesn't care, like the mama bear is going to take our place. So be careful what you ask for.
(37:01)
That got over 7 billion views on the hashtag. It was one of the most successful hashtag campaigns ever. And then it's petered out a little bit, but I was like, it was a very weird feeling like teens would come up and stop me all the time. And they'd seen the tiktoks and it went from, I don't think we were actually hated and some of them did, but to actually, we kind of got the high fives and they kind of just, yeah, you guys annoy me sometimes. But they were now they feel like members too. They like it. And then teens started, especially the Covid kids started asking their parents to use Life 360. And so TikTok is, I've hung up the cleats I haven't posted in probably a year. You can't find the paintball video if you want, we can send it to you. Go to my TikTok.
(37:43)
It's Life 360 CEO. But I have passed the baton to our team and they're doing an excellent job now. They have surpassed me in followers and videos and a lot of what we do is we make fun of ourselves and we even tell teens how to break the app. I will tell any teenager how to break the app and hide from their parents. We're not trying to force the app on anybody. And I think people believe us now. And it was true. So being authentic and engaging and not hiding behind corporate brand handlers is how you do well on social media. And I think one of the benefits that we are still a founder-led company is I have this spiritual authority to break these rules and take these risks where I think if there were a board hired CEO, it would just be a little bit weirder. I know why I started the company, I know why we exist and I have the credibility to say that. And when I want to be goofy I can. And I think that's really helped us. And now we get to these huge TikTok surges and downloads and it turned into this thing for a while. Like, oh my god, even though it was sort of a joke with these one stars was very bad to now it's a great acquisition channel for us and brand tool. And again for the teams, they're our members too.
Austin Hankwitz (38:54):
Wow. That is a crazy experience. And I love the haircut. Haircut looks good on you, man. I'll tell you what, the long hair, it was that bobble head behind
Chris Hulls (39:04):
Me, the team made that for me to commemorate the long hair.
Katie Perry (39:08):
Chris, you're now the third guest on our show who has served in a military in some capacity and it's really interesting to see that trend across the shows we've had and such a large share of executives we're talking to have that background. And I'm curious, what is it about those experiences that built you as a leader? And what about those experiences do you think mold someone to lead a public company?
Chris Hulls (39:35):
Yeah, so I was enlisted. I joined when I was 17, which I think is a little bit abnormal. Most execs usually who'd gone after college and were officer. So I was not in a leadership position in the military. I think in terms of what it did for me, I grew up on the periphery of Silicon Valley in Marin County, which is right north of San Francisco. So when I think about the military, it got me out of this bubble. I grew up and I didn't grow up wealthy, I was in a small town, but it was still in the valley so to speak. So getting out of that kind of coastal zone and seeing what the rest of the world was like. But I think there's one thing, and I was not a good military member. I was always a troublemaker, but I got my honorable paid for my college, all that.
(40:16)
If you are in the military, there are no excuses. And if something needs to be done, it gets done. And I had pretty bad grades in high school or not bad, but they were to get a's on tests, but I never did my homework. If you are a teenager that needs that kick in around discipline, the military is great, you don't complain. I think in some ways it's good to be at the bottom because you just learn that nothing's beneath you. And in the early days of a startup in particular, it's a fricking slog. And I think a lot of people I've met and even employees, they went to Harvard or Stanford or whatever and they succeeded by ticking boxes where the problem's very well defined, but it's sort of different than just you figure out how to get things done. So I think being in a bit more, even the military is also very procedural, just a no excuse mindset really helped me and helped me grow up a little bit in a way that has translated. It
Austin Hankwitz (41:14):
Sounds like the military taught you of course the no excuse mindset, but also how to be pretty resourceful.
Chris Hulls (41:19):
I don't know if the military is resourceful in terms of just, I was a grunt basically. So you just do whatever and just maybe the resilience piece was there and then being outside of, I was in Arkansas for a few years, I was able to see a very different part of the country. And I don't think one is better or worse, but they're very different. And that was helpful because I think a lot of people that have, especially a lot of entrepreneurs grew up with wealthy families. You take a lot of risks to start a company and if you have those resources easier, I think it's been helpful that I did not have that background and I was able to see the rest of the world and have that maybe a little bit more of a struggle.
Austin Hankwitz (42:01):
I love that perspective. Chris, thank you so much for joining us on this episode of After Earnings. Everyone, if you do not have Life 360 on your phone, here's your chance, download the app and follow Chris here on TikTok to get all the behind the scenes and maybe you'll see a video of him getting shot by pinball. We'll
Chris Hulls (42:17):
See it and you'll see all the Wes too. Thank you so much for having me,
Katie Perry (42:22):
Austin. I'm not going to lie, that was not what I was expecting from the CEO of a safety and security company. What were your takeaways from our chat with Chris?
Austin Hankwitz (42:32):
Yeah, I feel like that conversation was one of those that I'd have in a backyard around a fire pit, like holding a beer. He just seems like such a homie. So shout out to Chris, what an awesome guy. Three things stood out to me. The first one was the members before metrics or members over metrics, one of the core values there and how important it is to them to say, we don't care to introduce specific products or business segments that are specifically going to try and move the needle from a financial perspective. But instead, how is this product going to help people's lives? How is it going to provide safety? How is it going to provide a sense of calmness and peace, knowing where someone might be or what they might be doing? Or back to the idea he mentioned insurance offers a lot, these targeted ads.
(43:17)
I think that's a really cool sort of mentality and a good core value for this company. Obviously they're now listed on the nasdaq. I think that's really exciting, especially as a company. He mentioned how whenever they started trading on the A SX, they had, what was it, 30 million? I think he quoted an annual revenue there, now they're doing 300 million. So they're a much larger company now. A lot of momentum behind them. And now they launched five new languages across the world. I think that's going to add about 10% more to their total addressable market, which is really cool. And then finally talking about the opportunity for boomers and just old people in general. I think when I hear Life 360, I immediately think about the teenagers on TikTok, maybe the people who are maybe in college, but it's a way for parents to figure out what's going on with their children.
(44:04)
But as I get older, I'm 28 now, my dad is in his late seventies. There is not a good solution for people like me who are technologically capable to keep an eye on their older parents. And I think as more and more Gen Z millennials and people of that age cohort begin to experience aging parents, life 360 might be the solution they depend on to keep an eye on them and make sure things are in the right direction. So I think there's a massive opportunity from that perspective as well. I love the conversation. Shout out to Chris. Really glad he cut his hair. It was pretty long there on TikTok for a bit, but Katie, what'd you think?
Katie Perry (44:43):
Yeah, I mean I am just trying to wrap my head around some of these teenagers ripping a Manu one on TikTok that might be in 10 to 15 years, paying subscribers to Life 360. And I just love the candor talking about he got personally called out on TikTok and he embraced it and he sort of got right in there, got in the mix and started engaging with these kids and actually shared about teaching them how to sort of hack the platform or use the platform to track their parents and how fast they're driving. So I thought that was super refreshing. It's just not what I was expecting from the CEO of a publicly traded company that deals with this kind of data. I also thought he was just super down to earth. I mean, he rolled into the interview with a seven 11 cup. That's just not something we usually get on this show.
(45:33)
But out in the world, that's what normal people drink for coffee. And he shared about how his background was unconventional. He enlisted in the military before college at 17. He's lived in places like Arkansas and he's not one of these founders that's sort of born out of the bubble in these coastal areas that sometimes don't have the perspective of how real Americans or real people live around the world. So I thought that was fascinating and again, just not something you get a lot from someone at his level. So all in all, great conversation, very entertained, very informed about the company. We hope Chris comes back on the show soon. And with that, this was after earnings, the show brought to you by Morning Brew and Stakeholder Labs. Be
Austin Hankwitz (46:16):
Sure to comment, subscribe, and maybe download the Life 360 app if you are a helicopter parent. Thanks guys. We'll see you on the next episode.
