How 2 Georgia fraternity brothers created Yik Yak, a controversial app that became a ~$400 million business in 365 days
By the end of the day, Long estimates her fellow students had written thousands of yaks, short messages posted publicly to other users within a 1.5-mile radius.
A few months before that, Long was hospitalized after she attempted suicide. The 17-year-old junior was distraught to read yaks that not only mentioned her depression but encouraged it.
"The first one says, 'Elizabeth Long needs to stop bitching about how she almost killed herself and go ahead and do it,'" Long recited to Business Insider.
The situation at Woodward Academy was becoming more familiar to Yik Yak and its founders, Tyler Droll and Stephen "Brooks" Buffington. Yik Yak had a knack for taking over schools - even college campuses - in a single day. Students liked the app because it let users speak freely without social status tainting their posts. But anonymity also encourages people to become the worst versions of themselves, and teenagers quickly resorted to being just that on Yik Yak.
In Alabama, someone used Yik Yak to anonymously post a school-shooting threat. Three schools in the area had to bring in extra security. And in Massachusetts a bomb threat posted to Yik Yak forced a high school to evacuate its students on two occasions.
After learning about experiences like Long's, Droll and Buffington realized they had a serious problem.
"We had feedback from students and parents and teachers, and we realized, if you want to build a long-lasting platform, you can't have a gossip website," Droll says. "Those pop and then they drop."
The startup's success has been meteoric. Yik Yak is only a year and a half old, but 1,600 college campuses use it. A few months after launching, Yik Yak had been downloaded 100,000 times. Today it has millions of monthly active users. In December, Sequoia Capital - the firm that backed the $19 billion WhatsApp - fought to lead a $62 million investment in Yik Yak at a valuation that approaches $400 million.
But the same features that make Yik Yak popular, anonymity and hyper-local context, could ruin the startup if it can't learn how to curb its users. And if building a $400 million business in a year and a half isn't dizzying enough, Droll and Buffington are being sued by a former fraternity brother who claims he owns a third of the app.
"It's a social experiment at scale," said one early-stage investor. "I have no idea how the results will turn out."
Not your average Zuckerberg
It's trivia night at the Industry Tavern sports bar in Atlanta. Two men who look strikingly similar approach a table in the back corner. Tyler Droll and Brooks Buffington are both 24 (Droll is older by one month). They're nearly the same height with blue eyes. Both have the trendy messy look with freshly trimmed locks mopping over their faces.
"I got a haircut this morning and Tyler hasn't commented on it yet!" Buffington says as he slides into his chair.
Both Yik Yak founders are wearing red. I ask if they planned matching wardrobes. "Well, that's embarrassing," Droll looks down and mutters.
We order a round of beers then chow down on pizza and nachos. We talk about their year and their backgrounds. Every few sips, someone approaches Droll or Buffington to say hi. The founders aren't famous. They're just locals - the high-school jock and the class clown who never left home - who happened to build a $400 million business down the street. A guy comes over and gives Droll's shoulder a squeeze. "I've known him since middle school," Droll says.
Buffington and Droll are cofounders and roommates. They share a three-bedroom apartment that's a 10-minute walk from their office with another college friend. They keep a marker by their bathroom mirror so they can swap ideas for Yik Yak while they brush their teeth.
"They are not the Mark Zuckerbergs of the world," Yik Yak investor Kevin Colleran says. (Colleran was one of Zuckerberg's first 10 hires at Facebook.) "They're social and fun and they party, but you can tell they have a complete understanding of college and what kids are looking for."
The younger of two brothers, Droll was born in a suburb of Georgia but spent his early years in Argentina. Droll's father worked for Bell South International in finance; his mother was a homemaker. The family moved back to Georgia when Droll was seven, where he attended public school.
Buffington, a middle child to an older sister and younger twin sisters, also spent his early years in Argentina. His father worked for Coca-Cola and was relocated to Mexico City, then Stockholm, and then to Atlanta, where Buffington spent his high-school years.
Both attended Furman University, a school with 2,700 students, in Greenville, South Carolina. Buffington chose Furman over Washington and Lee because he found the 750-acre campus scenic. For Droll, Furman offered the chance to play tennis and study premed.
In that class, Droll met a student who was a year younger, Dougie Warstler. The two pledged Kappa Alpha fraternity, where Buffington was already a member. Warstler chose Buffington to be his big brother - a peer mentor and friend - in the frat.
Warstler is suing Buffington and Droll for millions of dollars, claiming he's the third cofounder of Yik Yak. Warstler declined to speak with Business Insider through lawyers, but public court documents tell his side of the story.
Sued by a frat brother
"We started working on stuff," Droll says of his relationship with Warstler. "We worked on a game that was more of a class project."
Fry Cook never took off, but the pair continued working together and looped in Buffington. The three worked on the next app, a quick-polling app called Dicho, together. Short for "dichotomy," users could create or answer questions such as, "Who's better, Michael Jordan or LeBron James?"
They formed Locus Engineering LLC in June 2012 for their apps. All three agreed to split equity in thirds, according to the lawsuit.
"People liked it," they say, "it just wasn't viral."
Warstler returned to Furman that fall to complete his senior year. Droll was accepted to medical school at USC Greenville, but he dropped out to pursue app ideas with Buffington. The pair moved home and met in between their two towns, at a Panera Bread, to build and brainstorm.
"We were pretty much throwing everything at the wall," says Buffington. "Then Tyler and I had this idea for Yik Yak and we were like, 'That's cool. Let's run with it.'"
Yik Yak now allows users within a 1.5-mile radius of each other to post and read short, public messages written anonymously, like a local bulletin board with flyers. But initially, the pair envisioned an even tighter radius, about 25 feet. That way, only people within the same classroom or building could read posts.
In October 2013, Droll and Buffington built a prototype to test local-based messaging and took their phones to a soccer field. Droll stood on one side and Buffington on the other. One would send a message to the other and shout, "Did you get it?" If so, they'd take a step farther back and test the range again.
"We were definitely obsessive about how accurate the app had to be," Buffington says. "I don't even know why we were. I guess the idea was, if I was in the library and I was sending a message like, 'Oh, do you hear this person eating chips really loudly?' we thought it would be abhorrent if the person in the dining hall saw that message."
Once they completed the distance testing, Droll says building the first version of Yik Yak took him a week. The app was a basic feed on which users could post a stream of local messages. There were no up and down votes or the ability to peek into other locations like the app has now.
Naming the application took longer than building it. Buffington and Droll kept thinking of "chatter." They wanted a name that reflected a movie theater, just before the lights dim, when viewers talk quietly among themselves.
A few weeks before Yik Yak's launch, the founders amended Locus Engineering's equity agreement. The revision stated that each founder would own 5% of any app it produced, like Yik Yak, totaling 15% of the app's ownership. The remaining 85% would be split among Locus Engineering's partners based on how much each person contributed to the project.
On November 6, 2013, Yik Yak launched in the App Store. The app took off quickly, thanks in part to a lie the founders told their friends.
Yik Yak, the founders fibbed, had been built at the request of Harvard students. The two wanted honest feedback from family and friends. They made their imaginary clients Ivy Leaguers because of the movie "The Social Network."
Within the first week or two, about half of Furman's students had downloaded Yik Yak. That's more people than Dicho had in a year. "That's when we were, like, 'OK, if this is happening at a school like Furman, we're good," Buffington says.
During Christmas break, the partnership between Droll, Buffington, and Warstler crumbled. On December 21, 2013, Buffington allegedly sent a text message to Warstler asking to buy out his Yik Yak stake.
"Hey so Tyler and I have been thinking about yik yak and we want to know if you'd be open to being bought out?" a message from Buffington in Warstler's lawsuit reads. "Tyler and I would like to at least have yik yak for ourselves to go with. For sure, we'll buy you out completely of if you don't want to do that then we'll buy most of your percentage out for a lesser amount."
"You're not being screwed out of anything," Buffington told Warstler a few days later, according to the lawsuit.
On December 28, 2013, Droll allegedly followed up with an email to Warstler, telling him that he needed to leave the company. Warstler says he declined and reiterated that he'd be happy to continue contributing to Yik Yak in a meaningful way.
On January 5, Buffington and Droll filed paperwork to dissolve Locus Engineering and create a new business entity for Yik Yak. On January 6, 2014, Droll emailed Warstler to inform him he was out. Part of that email was quoted in the lawsuit:
"We have decided that our best course of action is to dissolve Locus. Between Brooks and I, we jointly own all of the intellectual property of Yik Yak and Locus Engineering has no stake in it [...]"
In November 2014, Warstler hired Luan Tran Liang, the same law firm that represented Reggie Brown against his fraternity brothers Evan Spiegel and Bobby Murphy. Like Warstler, Brown was suing his former friends over Snapchat's founding, and he was handsomely rewarded in a settlement.
The Yik Yak lawsuit is ongoing.
First semester
Scouring each school's website for student organizations, Droll and Buffington started in the South and went college by college. They plugged each group and its leaders into a spreadsheet along with the people's titles and email addresses.
Every Tuesday, Buffington sent thousands of personalized emails, scattered with fratty jokes, to the people on his spreadsheet.
The opening lines often read: "Hey ___, could you do a favor for a few rad dudes?" followed by, "You should get on the gravy train."
"It was pretty much, 'Yik Yak is awesome, and you're lame because you're not using it,'" Buffington says.
That strategy worked at the first big school Yik Yak onboarded, Georgia Tech. Once Georgia Tech's campus became heavily penetrated, Yik Yak targeted their rival school, University of Georgia.
"We were like, 'Hey, there's this really cool app called Yik Yak and GT is using it. Why aren't you guys using it?'" Buffington says. After that, 2,000 students at University of Georgia signed up in a single day.
While Yik Yak was busy amassing a large college following, Silicon Valley remained blissfully unaware. Venture capitalists poured money into anonymous-app competitors Whisper and Secret. In January, Yik Yak took an office space and a $20,000 investment from Atlanta Capital and grew to 100,000 downloads. Later that month, TechCrunch reporter Jordan Crook visited Atlanta for a Pitch Off event. Desperate to get Yik Yak's name out, Buffington and Droll attended with the intention of meeting her.
A few weeks later, in New York, a man named Ron Rofe of Vaizra Investments was scanning TechCrunch when an article by Crook caught his eye: "Yik Yak is an anonymous app aimed at college campuses," her headline read.
Rofe picked up the phone and booked a flight to Georgia. He became the first venture capitalist to invest in Yik Yak.
Silicon Valley wakes up
In late January 2014, Buffington's uncle called an elementary-school friend who worked for Google, Alan Masarek.
He told Masarek about Yik Yak and asked him to advise his nephew. Masarek had founded and sold QuickOffice, a suite of mobile productivity tools, a few years before.
"You're a mobile guy at Google. Would you be willing to speak with them and be a sounding board?" Masarek's friend asked.
Masarek obliged and started talking with Buffington and Droll.
Soon, other Silicon Valley players began to notice something bubbling up in Atlanta.
Niko Bonatsos is a partner at General Catalyst who sourced the Snapchat investment for his firm. He frequents the App Store so much that he can rattle off apps in order, by category, on any given day. Last February, he noticed a new app picking up steam in the social-networking space.
Bonatsos downloaded the app and scrolled through its feed of anonymous posts. Users weren't generating any content in California, but he was able to scroll through the most up-voted yaks of all time. "The content was un-freaking-believable," Bonatsos recalls. "I was reading one joke after another, and I found myself laughing like crazy."
That was enough for Bonatsos to send a LinkedIn message to Buffington and schedule a meeting.
The initial call was "hilarious," Bonatsos says.
"[Buffington] was constantly cracking jokes," he recalls. "I thought, 'Clearly this guy is very fun, entertaining, and quite a different founder than the ones I've been meeting in the Bay Area."
Buffington shared metrics with Bonatsos that were "insane."
Bonatsos offered to fly Buffington and Droll to San Francisco.
Shortly after the California trip, Yik Yak pooled together a $1.5 million seed round at a valuation that was in the single-digit millions. Ron Rofe, Kevin Colleran, Niko Bonatsos, and other angel investors participated. But the money came with a caveat: Buffington and Droll had to promise they'd tackle the bullying issue that had begun to crop up at high schools.
The founders agreed, and came up with a crazy-sounding plan: They'd kick all high-school students - a huge chunk of its user base - off Yik Yak.
The bold decision
On March 15 2014, Droll and Buffington held an emergency meeting in the break room of their tiny Atlanta office. They needed to figure out a way to prevent high-school students from using Yik Yak. Targeting them, however, was difficult since the app doesn't collect user data.
It does, however, collect a user's location.
Droll and Buffington devised a plan to use high-school students' locations against them. They'd write a script for a particular address and block Yik Yak access there. Users who opened the app in the blocked area would see an error message telling them to relocate and try again. This act of erecting virtual walls around an area is called geofencing.
The founders first geofenced the entire city of Chicago, which had become particularly problematic on Yik Yak.
"It was pretty funny because [Chicago] was talking about the app - the news, kids, parents. They were all talking about it, and then they'd get on the app, and they couldn't use it," Droll says.
The founders spent all weekend blocking other troublesome areas, like high schools and middle schools across the nation. In the end, Yik Yak geofenced about 100,000 US schools. Yik Yak also geofenced other countries, to prevent premature rollouts abroad.
"It probably would have taken over the high-school landscape, so we definitely sacrificed a lot of growth," Buffington says. "But it was in the name of making sure our app was being used as we had intended."
Droll and Buffington's ethical stance on Yik Yak gave investors the conviction to back the peculiar and largely nontechnical Georgia boys.
"They fired about two-thirds of their customers. People don't realize that," Masarek says of the decision to shut down the app at high schools nationwide. "How brave it was, when you're trying to grow and they had massive usage among high-school students, but those users didn't have the maturity to be anonymous."
"They proactively blocked 70% or some users," says Colleran, who decided to personally invest alongside Bonatsos, even though their firm General Catalyst passed. "They were thinking so far ahead that they were willing to lose users in order to build a safer environment."
Straight to the top
Many companies that target college students hate holidays. Their users flock home for summer, winter, and spring breaks. They trade playing beer pong, Facebook stalking, and posting to Yik Yak for sleep and family time.
Spring break 2014, however, was a pleasant surprise for Yik Yak, which experienced unparalleled growth during those few weeks in March. Instead of ditching Yik Yak, students brought the app with them and shared it with people at other schools.
Before spring break, Yik Yak was active at 30 to 50 schools. By the end of the semester, more than 250 colleges were using Yik Yak.
In June, Yik Yak closed a $10 million round of financing from Colleran, Bonatsos, and others. Droll and Buffington began to pay themselves salaries and hired their first real employee, Ben Popkin. They also hired Tom Chernetsky full time as CTO. He had been working as a consultant to fix Yik Yak's constant site crashes since February.
One month later, the founders' fears were realized. Summer break hit and Yik Yak users disappeared.
The app's hundreds of thousands of active users dwindled. Usage bubbled up in a few East Coast cities and at events like sports games. But largely, Yik Yak fell off the map, out of the App Store charts, and out of Silicon Valley's mind.
"There was still a question mark of what [usage] would look like in the fall, because everything was still our first time," Buffington says. "There was still definitely a question of, what are these schools we're at going to come back as, and how are we going to spread to all of these other schools?"
In August those questions were answered.
Even though students weren't actively using the app over the summer, they were talking about it with friends, which paid dividends in the fall. Generating close to 100,000 downloads a day, Yik Yak came roaring back and shot to the top of the App Store. It became the No. 3 app - and above Facebook, Twitter, and Pinterest.
Every major investment firm in Silicon Valley suddenly became very aware of Yik Yak.
Going viral
Through the end of August until late September, Yik Yak experienced jaw-dropping growth, soaring to millions of monthly active users almost overnight. The app broke the geographic barrier of the Rocky Mountains and showed up on Stanford's campus, aided by a marketing tour that Buffington and Cam Mullen, Yik Yak's second campus rep, put together.
Starting in Oregon and ending in Arizona, they rented a 50-foot bus and toured 32 colleges in 85 days. Buffington purchased a costume for the app's mascot and spent thousands of dollars on a custom-built mechanical yak to hitch to the back of the branded tour bus.
"If you have a casual user on campus, and they get to meet the Yak and give him a hug, then get a pair of socks or maybe they're at a party and they get to ride the yak, that's what takes someone from going, 'Yeah, I like Yik Yak,' to 'I love Yik Yak,'" Buffington says.
Venture capitalists began dialing Colleran nonstop, asking for introductions to Droll and Buffington.
"Over two weeks I got a call from every partner at every firm, because no one knew who these kids were," Colleran says. "It ranged from every well-known, big-name investor to people I've never talked to before saying, 'I'm flying to Atlanta.'"
Although Sequoia had initially snubbed Yik Yak's seed and Series A rounds because of a conflicting investment in Whisper, Goetz was determined to lead a new large investment in the most-hyped app of the fall. He flew to Atlanta several times until he convinced Droll and Buffington that Sequoia's investment in Whisper would have no effect on a potential investment in Yik Yak.
Goetz ended up leading a $62 million Series B round in Yik Yak at a valuation that approaches $400 million. Goetz admits the app's current scale may not seem to justify $400 million, but he says its engagement was enthralling. Particularly, investors were excited to see Yik Yak infiltrate the college market so thoroughly - the way Facebook had - and to see a high percentage of monthly active users open Yik Yak every day. Those daily active users also lingered on Yik Yak for extensive periods of time. About 22% of Yik Yak's users publish posts.
"I joined Facebook as one of the first 10 employees, because I loved that they were the standard at college," Colleran says. "This is the first thing I've seen since then that has the same feel."
The company now has 25 employees, and it's poaching people from places like Google and Dropbox. Yik Yak has more than 350 campus reps.
When you ask Droll or Buffington if they realize how rare it is to create a $400 million company in one year, they just shrug.
"It's tough to take a step back and be like, 'Damn. We pretty much took over the American college market in a semester,'" Buffington says. "But it's kind of like, there are college campuses where only half of the student body uses Yik Yak, and that needs to be at 100%. It's a never-ending thing of chasing the wild rabbit."
Droll agrees that it's hard to stop and appreciate the growth. "You still wake up and make yourself breakfast and drive the same car, then do it all over again," he says.
A controversial future
Yik Yak's move to eliminate high-school students squashed much of the bullying, but not all of it. The app has since added community-policing tools and ways to flag racist, misogynistic, and offensive posts using keyword and name targeting.
College students have mixed reviews of Yik Yak. Aimee Knecht, a senior at the University of Tennessee, says she uses Yik Yak "more often than I should, to be honest."
When asked how big it is on campus, Knecht said "huge."
Yik Yak has proved useful as an alert system for college campuses. When a student open-fired on Florida State's campus last fall, many learned about the news on Yik Yak before they received an email from the university.
Another college senior at the University of Alabama, Samantha Fulgham, says most students seem to use Yik Yak. But she says students use it primarily for bullying, and she's deleted the app twice because she felt "morally wrong" reading the content.
"It's got a negative stigma," 21-year-old Fulgham says. "It's basically a place for cyberbullying with really cruel stuff. What I thought it'd be is an anonymous Twitter with witty comments, but what it's turned into here is basically starting rumors and talking really badly about people on campus."
It's unclear if Yik Yak will be able to shed its bad reputation completely. Anonymous app Whisper has been lambasted for allowing rumormongering. Another anonymous app, Secret, raised $25 million before losing all its traction. Users sued Juicy Campus, a college gossip site, to death for allowing libelous comments.
An unlikely person has faith in the platform, though: Elizabeth Long.
She and her father were invited to Yik Yak's headquarters in December to speak about the Woodward Academy incident. Both of them now feel Droll and Buffington are building something positive and that the app will succeed.
Silicon Valley is on Droll and Buffington's side, too.
"The best investments are controversial," Bonatsos says.