Product Hunt: The Internet's Destiny Machine

Product Hunt: The Internet's Destiny Machine

In the world of product launches, there is one platform that has become a game-changer: Product Hunt. It has become almost unthinkable for a new product to launch without posting on this platform. The reason? Product Hunt represents an opportunity to win new users and attention at no added cost, often resulting in meaningful valuation changes.

Product Hunt's journey began with a tool called Ship, which offered pre-launch audience-building tools. This was the platform's first attempt at generating subscription revenue and remains a vital part of the platform today. With Ship, Product Hunt aimed to attract more users and build a community before the official launch. This approach of starting with a community and then building the product, rather than the other way around, was a unique and successful strategy.

Ryan Hoover, the founder of Product Hunt, understood the power of community from the start. He created a group on the platform, invited some startup friends, and asked them to contribute by sharing links to their favorite products. This early community-building effort set the foundation for what Product Hunt would become. And it worked. Product Hunt grew rapidly, attracting tens of thousands of visitors and experiencing a 75% month-over-month growth.

One key factor that set Product Hunt apart from other platforms was the genuine and warm community it fostered. Unlike the snark and sarcasm often found on platforms like Hacker News or Reddit, Product Hunt won affection from its users. Ryan Hoover himself played a significant role in cultivating this community. He was described as the best community and product person, genuinely likable at scale.

However, despite the success and popularity of Product Hunt, there was one problem: it wasn't making money. This had been a strategic choice, with Hoover prioritizing the platform's growth over revenue generation. In hindsight, he admits that dedicating a portion of resources toward generating revenue would have been a wise decision.

In pursuit of revenue, Product Hunt explored various avenues, such as launching a "Shop" in partnership with General Electric and integrating podcasts and book reviews. But these efforts didn't move the needle significantly. By late 2016, Hoover faced two choices: a Series B funding round on unfavorable terms or a new alliance with AngelList.

Ultimately, the alliance with AngelList proved to be the right move for Product Hunt. It provided the platform with the support and resources it needed to continue growing and evolving. Under this new partnership, Product Hunt made the majority of its revenue through advertisements. The company sells various sponsorship products, including promoted listings, email collection, topic-based ads, newsletter sponsorship, and job postings. Advertising revenue accounts for the majority of their income, with Ship and Founder Club subscriptions contributing the rest.

Looking to the future, there are a few actionable pieces of advice that can help Product Hunt further enhance its platform and revenue streams. First, the company should consider clearing room for new growth by shuttering or transforming the site's least used corners. This will allow them to focus on the areas that bring the most value to users and advertisers.

Second, leveraging early traction data can be a game-changer for Product Hunt. By analyzing the number of email sign-ups and other metrics, the platform can identify promising projects early on and provide them with an extra distribution bump. This will not only benefit the makers but also increase user engagement and satisfaction.

Finally, Product Hunt should consider establishing an incubator to support founders in the early stages of their startup journey. This will allow the platform to front-run the existing maker flow and provide valuable resources and guidance to entrepreneurs who need help before they even have an idea or product to work on. By nurturing and supporting these founders, Product Hunt can position itself as a leading platform for startup innovation.

In conclusion, Product Hunt has proven itself to be the internet's destiny machine. Its unique approach of starting with a community and then building the product has attracted a loyal and affectionate user base. While revenue generation has been a challenge, the platform has found success through advertising and subscription models. With the right strategic moves and a focus on user value and engagement, Product Hunt has the potential to continue shaping the future of product launches and startup growth.

(Note: The information about Product Hunt's revenue and future plans is based on publicly available data and statements from Ryan Hoover, the founder of Product Hunt.)