Startup Grind DC hosted Eugene Stoltzfus, co-founder of Rosetta Stone, for its third event in Washington, DC. The event was hosted at local incubator nclud, and welcomed many first-time Grinders to the community. Public events are far and few between for Eugene, so we were honored to hear his thoughts on a family business which was started by his late brother, Allen Stotlzfus and eventually turned into a colossal publicly traded company (NYSE: RST) with revenues of more than $270 million.
Eugene, being a man of many trades (architect, photographer, writer, theater carpenter, farmer, etc.), spoke much about his initial involvement with Rosetta Stone during its early years. Before Rosetta Stone was the product we all know today, Eugene mentioned that his biggest contribution to the company was his perception of design (to Eugene, software engineering is like herding cats). The photos and videos used for the software were dated and ambiguous, so with a camera, Eugene set out to capture more than 18,000 photos and hours of video for the product. During development, he said they used the “power of a picture” to create scenarios in which people could easily learn another language. With every spot of wall space covered in photos, they sculpted scripts that became the prototype for today’s Rosetta Stone.
Although the first couple of years were difficult while running on investments from his mother ($30K), Eugene agrees that the process was exciting, and you were always learning new things. He and Allen loved the fact that they were “starting something from scratch,” and that their “own ideas” crafted and molded the product, not those of investors. He eventually got his whole family involved into the business from having his sisters handling marketing and legal, to having his nieces and nephews doing the initial user testing.
Rosetta Stone was built on iteration of good ideas which he quickly learned while growing up. Eugene stated, “You have to put your ideas out there, but it has to advance the conversation. Nobody should be attached to their ideas.” Because with every bold idea, you had to be able to defend them or else five intelligent siblings would find holes in your argument and tear it apart. To Eugene and Allen, the experience changed their lives and strengthened their relationship, for as he said poignantly “we didn’t just build Rosetta Stone or a software, more than anything we built ourselves as people.”
Eugene went on to say that the more important quality in business is your character. To Eugene, your “character is a magnet,” and you need to have a “magnetic center for respect, integrity, honesty, thrift, and hardwork”. Without those qualities, it will be very hard to attract the necessary people that will contribute towards your cause.
After confessing that Albert Einstein was his favorite “superhero,” he closed the talk by saying that the old adage that a great product can possess two of the three qualities of being fast, good or cheap is simply dead wrong. “You have to go for ALL three,” he finished, “for it’s the only way you’ll get anything worth your while.”