Is Evernote the Anti-Zynga? Phil Libin at Disrupt Beijing

This is a part of our TechCrunch Disrupt 2011 event coverage.

#15:05: And we’re back for another “fireside chat” sans the fire. This one is Sarah Lacy talking with Phil Libin of Evernote. It’s called “Building the Anti-Zynga.”

#15:06: Sarah Lacy compliments Evernote, says it’s the only thing she uses every day. Libin says that was their goal. Why are they called “the anti-zynga”? Libin says this comes from an offhanded comment he made. When people have downtime (i.e., in two or three minutes) they have a choice: kill some time, or try to accomplish something. If they want to kill time, they can go to Zynga and play games. If they want to accomplish something, they can go to Evernote.

#15:08: Sarah Lacy says Evernote is like Tivo — you don’t get why it’s so exciting and useful until you use it yourself. “It serves the whole you,” Lacy says. Clearly, she really likes Evernote. Like, a lot.

#15:09: Libin talking about the “Freemium” model: people tend to put the emphasis on the wrong half of the Freemium model. Evernote’s free version is the main product, not just a way to trick people into paying. Extremely low-touch, low-pressure approach to getting people to pay. He says they lose people in the first few weeks, but once people have used Evernote for more than a month, basically no one drops it, and the longer people have used it, the more likely to pay for some of the previous things. So in their first month, 0.5 percent are paying, but after three years of use, over 25 percent of users are paying.

#15:12: Sarah Lacy: You don’t look like the typical SV start-up entrepreneur (Zuckerberg-lookalikes with flip-flops and hoodies). “With all due respect, you look like a high-school science teacher.”

#15:15: Sarah Lacy says that unlike many tech companies, Evernote consciously chose not to care about their valuation. “Valuations of private companies are very strange thing,” Libin says. The valuation is “whatever the craziest buyer wants to pay.” So you can chase the craziest possible investor, “but then you have a crazy person for your boss.” So they didn’t chase the highest valuation. They’re in it for the long haul and they don’t want crazy people on their board.

#15:17: Sarah Lacy is talking about other companies trying to drive up valuations, saying this is a real trend, and citing DropBox as an example. But Libin says DropBox did ultimately go with good investors rather than the “crazy person” highest bidder.

#15:20: Where do you stand on IPOs for startups? Libin is for it, as long as it’s executed properly. Now there’s a way for start-ups and early investors to get some money back, which relieves the pressure to sell the company early. “I think that’s a hugely positive step,” Libin says, “though obviously it can be abused.”

Now talking about Libin’s move from Boston to Silicon Valley, which was apparently inspired by Mike Arrington’s writing on TechCrunch.

#15:21: Libin makes a crack about the weather. Lots of laughs. It has been awfully polluted in Beijing the past two days. Of course, that’s not a big difference from normal. But today is especially bad.

#15:23: What are your take-aways from visiting China? “We need to be in China,” says Libin. “We don’t care about the markets [because] we don’t sell anything” but he is attracted by the creativity and energy that is here in China. “The energy in China is what makes me want to be here.”

#15:24: Libin also visited China seven years ago. What’s different? The start-up atmosphere is much better now. Back then, everyone was very short-term focused, and there were lots of people focused on making clones. Now, there are many “high quality, original ideas.” Beijing is getting mature enough to generate great companies.