Nick Huzar on Innovation, Failure & the Treasure Hunt That Became OfferUp
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My name's Rudy Moore, host of Living the Red Life podcast, and I'm here to change the way you see your life in your earpiece every single week. If you're ready to start living the red life, ditch the blue pill, take the red pill, join me in Wonderland and change your life.

What's up, guys? Welcome back to another episode of Living the Red Life. Joining me today is Nick, the founder of a brand I'm sure you know. It's called OfferUp, a disruptive brand that grew super fast and built a massive community. And it's really set a trend, I think, for that industry over the last few years.

So super excited to dive into how it's grown so big and the strategies and wins and losses on that journey. Nick, welcome to the show. Thanks for having me, Rudy. It's good to be here. So most people know OfferUp. I'm sure many of the people listening have even used it. But if they don't, you mind just giving a one minute overview of the company?

Yeah, OfferUp's the largest local marketplace in the United States. We really want to be the best at buying and selling things locally. Not just buying and selling. Actually, we're branching out big time this year. We're launching services and jobs and rentals. And we even have local news now. So we really want to be everything local is kind of how I would think about OfferUp.

Yeah, and I want to dive into that expansion because you obviously got the clientele database and means to do that. So I'm super excited to see that roll out. But let's start from the ground up. Like, how did you get it so big? Right. Can you talk about that growth journey?

Sure. Well, I'd say in the early days, you know, everyone has the idea. And then it's then the hard part is how you execute. How do you build it? You know, we started writing code for OfferUp before there were Android phones. That gives you an idea where we were.

And it was a hard time. A lot of times building companies, they say it's about timing. I think we were pretty early. Like we saw this phone. We had this idea that, hey, we could all we're all going to have these phones. We can just take pictures and we can communicate with, you know, with these devices. But there's a lot of skepticism. A lot of people thinking, you name it, I've heard it. I've heard people say that no one's going to buy from their phone. How do you disrupt Craigslist?

You know, it's just no one's been able to do this. And so I think, you know, for better or worse, I think good entrepreneurs just have a an idea and they can't get out of their head. And that was definitely me. I was stubborn and I just said, that's it. We're going to go build this. But it was really tough in the early days trying to get scale, trying to get users to use it. So that was, I'd say, a two year journey.

Hey, there's an app. Why isn't everybody using it? And so you just have to run a lot of experiments and understand what works or doesn't work. But that was, you know, pretty much I'd sum up the first two years was just lots of failed experiments. And then ultimately some that worked and we just kept doubling down on those to to to grow.

Yeah, and I would love to talk about that point to start off with. Like, I sit on a lot of, like, events, like, shop, like, panels where people pitch their ideas and all those things. And I always see these apps and communities come along where they want to do this, like, nationwide thing. And I'm like, the...

scariest hardest part of it is your app and idea only works if you get a big velocity of people right because they're trying like it has to compound itself like you know hair salons right around america it only works if you get a bunch of hair salons and a bunch of consumers all pretty quickly or they get bored and quit and i i would be so scared to start that business because it's like

You can't just sell the product as it comes in sort of thing. So how if someone's listening like that, how do you how do you how do you tackle that and really get that velocity as quickly as you can?

Yeah, I'd say, you know, knowing your customers and knowing what matters. So in the world of a marketplace, when you post something, somebody better buy it. Because if somebody doesn't buy it, then what's what good is your marketplace? So we got really good in the beginning. I think sometimes people try to scale too big. In fact, there was a number of other competitors to offer up when we launched. They raised a lot more money than we did.

And I told the team, don't worry, they're going to go out of business. Like, what are you talking about? I said, look, they're probably smart engineers, but they're not thinking about their number one metric. So they would launch and say San Francisco, then they'd say we're nationwide.

Well, not as peanut butter in the US. And if you're trying to convert and get people to use your local marketplace, who cares if your next install is in New York? Right. And so we did the opposite. In fact, we drew a circle on a map with like 30 miles around our office. And we said, if we don't win here, we don't there's no business here.

And we spent a year just hammering on that circle, trying to figure out how do we get things to move. And so we would buy and sell things. Everything in here is from OfferUp, by the way. So my wife is an 18. That's why it's in here. Oh, I love the idea. It's great. So you have to kind of fake it in early days. I'd show up and I'd buy the chair. I wouldn't say that I worked at OfferUp. I would just pretend like I was a buyer. But then I'd hype it up, of course. Like everyone uses it. Meanwhile, no one really did.

uh so those are some of the and the benefit of doing that is you're learning too you're talking to customers you're getting some feedback and so you do that a lot in the early days um and that's important because that gets your i call it the petri dish phase right you're figuring out the product you're figuring out go to market you're figuring out marketing you're making sure that the metrics are working then okay now that works now sure you can do that in other markets and i think

Far too often I see entrepreneurs just throttling because they think they need to scale right away. And that usually ends pretty badly. So we were very disciplined, like I said. We spent a year at one market before we went to any other markets.

Well, and I do want to touch on something a little more like mindset based too. So I have a documentary coming out. I'm part of it. I say, you know, I think I'm delusional. I must be delusional. And someone said to me, why do you use that word? Because it's normally meant like in a bad way. And I'm like, no, I just think the best entrepreneurs and athletes are like,

so delusional in their own little world and like how they see things that that's why it works because they have that crazy belief and maybe delusion is quite not quite the right word but like they have that crazy belief right and they see it before anyone else can and and you just reminded me of it when you talked about the chair so what do you think about that like that belief in it i think market adresin has said this that great entrepreneurs can shape the world

And I believe in that. And it sounds kind of egotistical and maybe delusional, too. But I think if you're getting after a problem space and you're doing something that's unique and you have the skills to go do it, you can make an impact. Like everyone said we couldn't compete with Craigslist. Everybody gets so many notes all the time. And look, you know, half the half the country's installed offer up now. Yeah, I think that.

shows just a relentless, maybe ignorance and just like passion for something. But also I knew, I looked at the other products and I wasn't delusional. No, and I just felt like we could build a better product. I'm like, we can do it. And so I think,

There's kind of a balance of that that you have to strike. And I think a relentlessness when you're building the company. People are too impatient, especially in this day and age. We're all in the TikTok swiping mode. And to build companies, it scales really hard. And it takes a long time. And I think most people just give up. There was plenty of days to give up in the early days, and we're doing it.

especially when you're in like more the app software space and the raising money space it's just like is yeah there's so many like gaps where it's just like almost you know i'm finding every good entrepreneur goes through it where it's like periods of time where it's almost over but you you may have it and then a year later you're like even in a better place and and i always you know i coach hundreds of entrepreneurs i have a massive community and i

Often see them get down. I say the one thing I've learned in 15 issues of business is right after a dark spell, there's like a light and it's normally better after it. You just have to keep going kind of through the tunnel to get to the other side. And yeah, most people I think do quit in the middle of that tunnel somewhere. Right. Yeah. I like the quote. The obstacle is the way.

just lean into it power through yeah yeah and we will learn that as we become big so let's talk a little you know this is a marketing as well you know based podcast and listening uh base so what are some of the marketing sort of tactics you use to grow the actual customer base and such you know the subscribers or user base

Yeah. So we, again, going back to that circle idea, like, okay, what is the metric you're trying to move? And so we tried every experiment you could imagine. Like we even rented a long haul moving truck and put a thousand helium balloons in there with off-road branding. And we went to the densest neighborhood we can find and we just blanketed it with off-road branding. It looks cool. So imagine coming to a neighborhood everywhere you looked,

And my theory was like, it was the idea was, Hey, we're going to, it's like lighting the day, the lighting or brush fire, right? Like, Hey, we can get everyone to buy and sell. And maybe that's the spark. And then I kind of expands. That was a big waste of time. Didn't really do a whole lot, but it gives you an idea of the type of experiments that we ran. So, you know, we ran everything, we measured everything and ultimately we,

we tried things like google and facebook that yielded pretty good results and we kept doubling down on that and you know kind of repeated that playbook throughout the country to the point when you get enough scale you don't have to really market as much locally you could just do it you know nationally and so over the years we started to spend more time doing that i mean you name it we've done we've done tv radio we've done i don't know if we've ever done a billboard but uh

Yeah, we've tried a lot of experiments. So I think in the early days, it's about thinking about as many ideas as you can and

And how fast can you test and work to see which one of those moves the needle? We didn't know, honestly. We teach that. My background is sports science. I have a master's degree. I came into business very data-driven, which I think most entrepreneurs aren't. And I always emphasize your point. You've got to keep testing. And I did a live training yesterday teaching how to create viral offers and

Yeah, I'm like, don't go into it hitting a golf ball, expecting a hole in one on your first ball and then quitting golf if you take one swing and miss. That's not how entrepreneurship works. And having anyone telling you it's that way is conning you because it's like every big founder I know and every successful person I know is like, test, test, test, test, test. Okay, one winner. Okay, back. Test, test, test, test, test. One winner, right? And it's...

written some repeat so so what was some of your biggest winners when you got that like hockey stick can you remember some of them uh well we got lucky because we were in the beta for facebook uh mobile ads so at the time facebook used to have these ads and i've dated myself

It's way back before that mobile app. I don't know how many of your listeners even remember that world, but they had these ads that were in the bottom right gutter and they were small and they didn't convert very well.

But then my co-founder said, hey, there's this beta for mobile ads. You want to try it? And this is when we had like no money. I said, sure, maybe like 50 bucks. But keep in mind, we were geo-targeting kind of like around our office and it was working. It was pretty effective. We could really target the type of audience that we wanted. So we were pretty fortunate being in the beta that it wasn't

available to everybody. So pretty quickly we dominated Seattle. We got a lot of coverage in Seattle and that kind of helped us to understand market dynamics and how we could target locally. But I'd say probably without a smartphone or without Facebook, there probably would be no offer up.

Wow, crazy. But then I imagine, you know, with like, you know, when we've run a lot of local stuff, it's like you can test it, you know, and find the winning creators, winning ads, blah, blah, blah. And then as you start expanding, you just duplicate out and expand, right? So is that kind of how you systemically went nationwide? Is that sort of process? Mostly. Sometimes there's nuances like a black leather couch might be really well in Seattle, but not in Arizona.

Nobody wants that hot black leather couch in Arizona. So I think there's nuances like that. But in general, I think where we became, I would say, world class is local marketing. I would say the OfferUp team, when it comes to understanding local market dynamics, buying and selling behaviors, how far people are willing to drive to get things, I think we're best in class with that because we've been doing it for a decade.

Yeah. And then so just so I understand, like, would you run most of your ads to like just some of the best products in that area to get people on there? Would you run general ads to be like, hey, learn it, like sign up for OfferUp and sell your furniture that's sat in your garage right now? Like what was it, a mix of both, I imagine, or was there more of one than the other? Actually more about the products. So, you know, OfferUp sells billions of dollars of furniture every year.

Right. So like like clearly couches and things like that do very well because we all need them and they're very much a local product. So we really tried to showcase all the great things that were on the marketplace that had to yield the best results for us.

And then you would just hope, like, even if someone hadn't used OfferUp, they'd see it by the couch, have a great experience and then go, oh, maybe I'm going to sell. And then they're going to become a customer on the other end, right? Go, well, maybe I could sell this lamp that's been sat in my garage. You would see a lot of that where they come in as a customer and then become a seller.

Exactly. And you see certain items. I remember the first time I saw a car or first time I saw a boat. And then right after that, within a few weeks, you saw way more boats. Oh, wow.

You name it, I've seen it. How did it feel going from cheap items, couches, and then it's like now you start seeing $10,000. That's great. Seeing jets, Lamborghinis, you name it. It's cool to just see how far it will go. I have my house here that when I moved in here, it was all like a jungle and I wanted to do a bunch of landscaping out front.

and I was tired of doing this and I think I was complaining the next day in front of a vendor well the vendor happened to be an offer up user he goes you should just post it for free and offer up and somebody will rip out all your plants for you again no way sure enough get it my whole front of my yard was empty in two days well what was the coolest item where you like text your team and friends like wow look what just got posted did you ever have one where it was like super cool

i don't know there's so much so our our office was always furnished from offer up like the whole thing like down to this other other than i'd say the laptops every single thing in the office was from offer up so there's been so many neat things like we have a star wars room it's one of my favorite rooms it has all these life-size star wars characters and uh you know we have this our boardroom table it took about 18 guys to get it in because it is massive it

It's just this huge table that we found on there. We have another dining table that was actually a bowling lane. It was all up over the years and somebody kind of put these big steel frames on it and made it a cool table. So it's just it's kind of a cool showpiece when people come by the office because there's so many different things there.

Yeah, so I have in my offices here in Miami, we have a 4,000 square foot content studio of eight rooms. And we actually, some of the most, and they're all super unique rooms for like influencers. And some of the most unique things in there we got from OfferUp, like look, because they're all these random like things, right? That you can't always find online. So that's cool. So what about like, you know, we talked,

a bit about the growth and growing it. What about kind of the follow up? Like, how do you keep people engaged? Right. Like, are you doing a ton of retargeting ads, email marketing, SMS? Like, how long does how often does a customer come back?

Yeah, well, if you think about just your own, most people's buying and selling behavior, the good thing, and one of the reasons we started with goods is we all have a need to get things and get rid of things. Yeah, it is a pretty common thing. And so that in its own nature creates natural re-engagement, right? So maybe you're posting an item for sale, then you come back and you're buying another item. Like I wasn't looking for this painting, but I saw it, I was like, that's kind of cool.

My wife hates it, but I like it. And so it kind of just works out that way sometimes. So people generally engage in OfferUp. The idea with it to be a very visual experience was to make it kind of like this treasure hunt. So people engage more on OfferUp, like social media and less like

you know, kind of real, just shopping. I have an intent. I'm in there to get my thing and I'm out like they just kind of browse. So pretty, pretty often. And so for us, I think the next leg for us is giving people even more reasons to come back. Like, man, it's on my house or any local jobs or, you know, I'm a small business owner. How do I drive more people into my, into my establishment? OfferUp's perfect for that because we have so much kind of local activity. So,

That's a big part of looking at is like, what else can we do now that we have this big audience?

Well, yeah, I wanted to talk about that as the next phase now. And like, you know, I have all these offices and renovations all the time and workmen and handymen and finding that stuff is always a nightmare. And I still don't think any one place has done it well, like Thumbtack and stuff. So like, what is your expansion plans there? Because you obviously could crush everyone with your database and brands, you know? Yeah.

Well, I think because they have so much engagement, it's worth trying these different verticals and seeing if our customers like it. And so, you know, I think we'll constantly be trying new things and seeing, you

and see if people find it really valuable. But I think that's one of the advantages we have because we are a top-of-mind brand and people come back often. So, I mean, you name it, we will play with it and we'll look at doing it. It doesn't mean that people are going to like it necessarily, but we should still try and do it. And so...

Like Amazon do that, right? That's how they become such a giant. They just like, they have the database now. And so it's like hard to launch something that fails almost when you have such a massive thing. But I want to emphasize that it's like, you know, your company's pretty big, right? Like in terms of revenue, employees, customer database side, but you still talk like the entrepreneur I talk with that's making a million a year where it's like, yeah, let's just try it, you know? So,

I love that. And I want to highlight that because I think beginner entrepreneurs think it's like you sit in this boardroom, come up with this idea and it just works. But that doesn't seem like that's how it is for you, even at such a big scale as one of the most famous brands in the world for what you do. Can you just elaborate on that a little?

Yeah. I mean, I think all companies need to keep growing. Like no one ever sits in stasis. If you sit in stasis too long, you're just slowly dying, in my opinion. And so that becomes hard as companies get bigger because they do become risk adverse companies.

Things can slow down the machine. And so you sometimes need to just lean in and take calculated bets and see what's going to work. But sometimes it's not always intuitive. Like most people don't know, I think AWS and Amazon, they have, you know how that started. They had a bunch of extra computers.

And then someone's like, well, what if we just put this on? What if we kind of use this? What are we going to do with all this? Right. So sometimes that's how good ideas come about. Um,

And you just need to have, I'd say, someone, you know, the executive team or the CEO say, hey, we're going to go try this. And the key is, you know, you don't always bet the farm. But in some cases you need to. Like Facebook is a good example. Mark Zuckerberg says we're going all in on mobile phones.

And I think that was the right call because that created so much more engagement for Facebook. And so sometimes you need to make really big bets, like bet the company bets. And sometimes you could just buy these little experiments that you try. And if they don't work, oh, well, the business didn't die. But I think it's a great key to experiment.

Yeah. And I love that. I always quote people from Warren Buffett, obviously more on the investor side, but I think his quote is so good. It's like, you know, make your losses small and your wins big, right? And if you can have that mindset as an entrepreneur with testing, I think you'll win. And you're exactly right. I think I always teach the moment you become complacent, you start losing, right? Because brands are always innovating around you. And I think the big

The reason big brands like Kodak, Blockbuster went out of stock is out of business is they grew in a period of history when innovation wasn't as fast. But now we have the Internet and phones like within 10 years, it's probably we've innovated as a consumer and a society. What Blockbuster before was 50 years. Right. So those big brands understand that. And they're just like lost, you know, lost their legs from under them.

Yeah. Well, that's another, the blockbuster example is another good one. Evil actually Netflix. So the original vision for Netflix was streaming, but they didn't, we didn't have the capacity to actually do it. So then they created, you know, the, I'm going to mail you the, uh,

the DVD in the mail. But then they disrupted themselves and said, no more DVDs. We're just going to go to streaming. So, I mean, those are risky. That's how luckily they paid off. Do you remember that when Netflix tried to also create their other sub brand? What was that one called? I forgot. That was a terrible failure. And luckily they recovered from that, but that was, they knew right away that that was bad.

Well, yeah, and the failures happen. I sent my team and my old staff Slack. The other day, I think Apple had put free...

billion or trillion dollars or three years and 200 billion into their car program. And they closed it down. So I'm like, guys won't feel too bad when we spend two days building a webpage and a funnel to test an ad. And I'm like, look, you know, Apple just spent three years and like 200 billion or something crazy on a car program and shut it down. Like it never ends. So, so I love that. Um, and I would just love to ask as we wrap up today, like, um,

you know, one of your biggest failures and wins that you'll always remember in your like career, right? So both sides of it, like one thing you had to work through and then one big win that you're proud of.

God, we don't have enough time for all the failures. I think when it comes to failures, my biggest ones I would say is it's usually people related, like building, building companies is all about people, the founders, the investors, like the people you bring on the team. And it's, I think it's the hardest part for any entrepreneur. Like you have this idea, great. Maybe you can code or build a product, but then you got to build a team. And that I think is the hardest part. Um,

not just hiring the one person, but how do you make sure that you're helping them to work well together, building camaraderie, or not moving fast enough on people that are just not right for the team. And so I've hired

very toxic people that almost killed the company. Like these are really hard things to navigate, especially when you're scaling very quickly. And so I, they think that I could go on and on with stories like that, that are, um, they've been rough. I think on the flip side is actually the same part of the coin is, um, hiring people that are, um,

like 10 X people. There are people that just, you're like, Whoa, like, look what just happened. I don't even, I don't even have one-on-one meetings with you. It's like, I, you know what you're doing. We just check in every time, man, that, wow, you're just crushing it. And so, um,

I think for me on both sides, it's all about usually the people more than anything, because the idea is easy. Everyone has the idea. Like you can talk to probably a hundred people that said, Oh, I had the idea to do an offer up there. Okay, great. But why didn't you do it? Because you have to go do what I'm talking about. You have to go build the people. You have to go network. You have to do all the hard steps. So I think those are the, I think those are the hardest parts for sure.

Good. Love it. Love it. So last last question. Easier question for you now. Where do people find you and the brand if they want to learn more? Yeah, well, people clearly got to offer up offer up dot com or they can find offer up in the app stores. People can find me on LinkedIn. I'm on Twitter. And so it's good ways to stay connected with me as well.

Good. Love it. Nick, thank you so much for the time today and diving into, you know, the brand and everything you've done, how amazing it's grown. And yeah, some entrepreneurial lessons along the way, which is what this podcast is all about. And sure, the audience appreciate it. So that's a wrap, guys. Keep living the red life. Take what you learned today and implement. And I'll see you all soon.