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In this episode of TeamWave’s FOUNDER STORIES, we talk with Founder and CEO of Party.Space, Yurii Filipchuk. This is the story of how Yurii saw an opportunity and need for virtual events, the marketing strategies used by them, who are their competitors and how they plan to scale up Party.Space in the future.
Party.Space is a video chat platform for creating engaging virtual corporate and community events. Their users host stunning online parties for up to one thousand attendees. Party.Space is the platform of choice for companies like Playrix, and Grammarly to foster and maintain their corporate cultures while working remotely.
Transcript of the Interview with Yurii Filipchuk (Founder, Party.Space)
Reshmi: Hello everyone. Today we have with us Yuri Filipchuk, who is the founder, as well as the CEO of Party.Space. Party.Space is a virtual party platform, featuring immersive 2D and 3D virtual spaces. Party.Space users host stunning online parties for up to 1000 attendees. Yurii, shall we get started?
Yurii: Yeah. Sure. Thank you. Thank you. Hi, sir!
Reshmi: I would like to hear from you, Yuri, what is this Party.Space?
Yurii: Yeah, sure. So Party.Space is our answer to zoom fatigue. During the lockdown, my co-founders who are game developers with pretty big experience told me, I think all products will feature video chat options. We know that’s the only way for people to work remotely when you choose a person. And most of them they’re going to be very boring and professional. They’re going to be as boring as CRMs. And why don’t we create a fun one, why don’t we start something for people to party up. Sounded pretty well. So we have jumped in this market. We have delivered the platform and our logic was yeah, games are awesome, but people are not installed in games. For like a casual call with a friend. So like a lot of games are not competitive because you have to install something else.
Browser games are mostly very basic or lame, so there are plenty of opportunities to work with them. And also we like the idea is to make it for groups of people, because when you have like one-on-one call no matter what the content is going on, it’s still going to be boring. So we have targeted group communication. We have decided to give it a try it, and we made it available in browser.
The product was like flat 2D space and for browsers. And the first use case was after party for gaming conference. And as I saw the feedback, I saw the excitement of people. We saw our product market fit and that was like start of the journey. And I can tell you like a story. So the next step was late summer when we saw that it’s pretty hard to gameify communications for people who don’t know each other.
So you actually have to break the ice of the communication instead of adding some additional features. And we saw that a number of products already aiming at that option, including like cupping with a matchmaking and networking skills and the hypothesis that if we provide our product for human resources they will actually help their teams to stay connected. Our main marketing instruments at the time was outbound in LinkedIn. We’re like reaching out to people and the result of that original one that we have landed a $200 deal with a big tech company.
So as I said, yeah, at the end of this year, we are going to have the end of year party. And there’s a music startup. It’s a very well known company, but I can’t announce it until we have the press release. And they said, you know what, we’re going to have a virtual project and we really like your product, but why don’t you create us a virtual venue in 3d?
Is it possible? And we thought, good, it’s actually possible. It’s a very good question, but we can, we can do it for you. Yeah. And as a result, we have created them a custom project and that was like a huge risk because only two and a half months are left before the event and the number of attendees it was pretty high. So we had like 2,500 people. It was more than half of the whole company and yeah, they went, went really well.
And at that point, we also had to think about what we were going to do next. And we saw the key. Yeah, they do is to help remote teams. The idea is to gamify their communication, let them have informal social meetings and parties online using our platform. And we sort of what was going to be like our killer feature and I think the Eureka moment was when we found out that when you move informal communication line, it’s the first time in human history when you can track data points for informal communication.
So corporate culture is, it was something unmeasurable, but as for now, we’re going to start measuring it and we will help people to actually work on their corporate culture. So maybe half a year, we’re going to have software to do AB tests on your corporate culture. What fits your company best like crazy drink and party, crazy drinking games or a classic music workshop. I don’t know, but we can find it out and, and it should affect everything. So that’s like not a brief, but the story of participants.
Reshmi: Great!! My next question is who are your target customers? Who are you focussing on?
Yurii: At the moment as the platform is exclusive, we are looking for big international corporations, mostly from tech to produce for them like custom experiences. And but in three months from now, we’re going to be able to accommodate smaller teams. So the platform will go public and then our ideal customer is going to be like the board remote team.
Reshmi: Great!! So how did this idea first come to your mind, this idea of Party.Space?
Yurii: Yeah. It’s first name and version was “Friends of scope”, and, that sounds less interesting than Party.Space. So actually both ideas came to mind of my co-founder, Arthur. At first, he came with an idea of creating virtual space, like informal video chat and then during the name and he came out with a domain name, which was pretty expensive, like dot Spacey. It was quite expensive, like $3,000, something like that. But this sounds like an expensive company, you know?
Reshmi: Okay. So who are your competitors as of now?
Yurii: Oh yeah. The landscape of competitors is pretty wide. So on one side we compete with Zoom and Google meet, you know because you can have sort of fun here, but on the other hand, like even Rodblox, Minecraft, VRChat, all those apps are also our competitors. So we, we are looking very precisely at either 3D platforms for virtual events like drop five of them. And probably Dreamwave is best in terms of technology. Yeah, I really liked what they were doing. And also there are a lot of 2D video chats with some gamified technologists. Like Indian company, Let’s Dive, I’m really keen on what they’re doing because they tried to gamify communication, but they are mostly focused on group games, but they don’t have the venue as we do.
Reshmi: Actually it started in 2020, right? And then COVID also started. So how did that affect Party.Space? Was it in a positive way?
Yurii: Oh yeah, yeah, sure. It’s affected. Like it created the opportunity for us, otherwise, virtual events won’t be that sexy space, but now it’s completely very, very interesting and lots more opportunities.
Reshmi: Yeah. So how do you plan to scale it up?
Yurii: Oh yeah, sure. So the main idea behind scaling is that the remote work is a new normal and the world won’t get back. So we’re going to see more hybrid events. We’re going to see, we’re still going to see a lot of remote teams. And our idea is to create the ability to collect data points. Often formal communication and participation will be as an engine of your corporate culture. We already saw the use cases that are Corona Virus based if I can tell that. Our latest clients is also a Unicorn which I still, I can’t tell you right now, but we’re gonna post it soon.
So as I have development office in Ukraine and they have the office Canada and they have created like an event for support managers from both offices to communicate, to speak to each other. So as they started with some formal parts, but then people went to some breakout activities and they actually have spent a very good time. And even without Corona virus, people still have a need to interconnect their offices. And ofcourse there is a communication.
Reshmi: I would go back a little like to the customer’s part. What was your marketing strategy to gain those initial? Maybe first few customers?
Yurii: Our initial marketing strategy was to hustle and to find clients in LinkedIn and to find somebody who can introduce us or something like that. And until the very last month, we, we actually, we didn’t understand our value proposition, but now when we know it, we are building everything upon corporate culture and our marketing plan. Like even now when we have just a website where you can leave your mail, we already have 100 contacts from high-level companies. So when people hear about corporate culture and the ability to affect it, human operations, human resources they’re very interested. We haven’t posted anything yet.
Reshmi: That’s great. So now, I would like to ask a personal question. Apart from Party.Space, what is is your favorite hobby? If you have free time?
Yurii: So my, my three favorite hobbies, first I like to travel and I like sort of extreme travel with a backpack when you don’t know where are you going to sleep at night? So I also like to travel through Southeast Asia especially cycle trips. So in this February, I have crossed the Vietnam with friends on motorcycles and like my second hobby is grilling meat. I’m really into barbeque burgers or my ribs. And things like that. Yeah. And third hobby is Sheesha. I really like smoking Sheesha. So if you can come and sometimes I can combine all my three hobbies. So when I traveled through South East Asia, I sometimes take my Sheesha with me and I find some local drill, and then that’s like the ideal time to chill out.
Reshmi: Now moving back to Party.Space, One question is like how was the initial funding? Did you bootstrap?
Yurii: Yeah. Yeah, so we have found a funding partner pretty fast. So because the idea was hot and we have raised funding from angels. And first, we have raised from local angels in Ukraine, but then we have raised more from angels in, in the US. And now we have like three months of a runaway because our clients paid us a lot. But our burn rate is increasing like, almost like it’s doubled in January. So we are hiring a lot of people and 3D developers, are very expensive. It’s very hard to find like 3D developers but we move it forward and we plan to, yeah.
We plan to raise, and I think that in February or early March, so in February we’ll start fundraising. And I hope it won’t take more than one month. My experience is from venture capital for four years. I have worked for my family office. I ran venture investments at it, so I know quite a lot about how to invest in startups, how to help portfolio companies to raise. And now I can sit in the chair of the founder and I’m really excited about this opportunity.
Reshmi: Yeah. So now how many employees are there? How many permanent employees are there in Party.Space?
Yurii: So full-time we have 12 full-time employees like that.
And a lot of people work in part-time because it’s very hard to hire senior person inside, but we were like hire a lot of people to help us develop the architecture or consult on some specific stuff is why a lot of part-time workers.
Reshmi: Oh, okay. Great. Now, we are almost coming to an end of the discussion, so I would like to know what would be your advice to the present entrepreneurs or future aspiring entrepreneurs?
Yurii: Yeah, sure. So I also always neglected the power of listening to our client, but now my team is even sometimes not taking me to calls to some calls because when I’m on the call, I’m starting to sell. But when they go to the calls, they try to listen and find out some important pieces of information. So you should listen to the customers, but you also have to hustle. And if you combined everything, the result is going to be outstanding, as we did
Reshmi: Well, that’s all Yurii thanks a lot for your time.
Yurii: Thank you. Thank you. Yep. Good luck to everyone. So Sign Up for our pilot versions, and we will help you to run informal social events for your teams. Just refer to this podcast and we will treat you well.
Reshmi: Thanks a lot and have a great day.
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