The Point may not be a household name, but the service it morphed into has certainly become one: Groupon.
Andrew Mason launched The Point at the end of 2006 with the goal of building a more effective online fundraising tool for good causes, which relied on a crowfunding model similar to Kickstarter and Indiegogo before either of these sites launched. Mason managed to raise about $1 million from investor Eric Lefkofsky for his novel idea. After about a year, however, Mason says he came under pressure from Lefkofsky to "figure out how The Point was going to make money," according to an interview with Chicago Magazine.
They talked about the possibility of driving revenue through ads or taking a cut of the funds raised on the site, but then settled on a third solution: collective buying. Campaigns would only go through on The Point if enough people signed up in advance to hit a tipping point. Mason and his team decided to apply this model to purchases by letting merchants advertise goods or services at a discount that would only go live if enough people signed up in advance. About a year later, Groupon was born.
Since then, Groupon has gone from being the hottest tech company around to an IPO disaster. Mason, the co-founder and CEO, was fired from the company earlier this year after a disappointing fourth-quarter earnings report that crushed the stock. Even so, Groupon generated more than half a billion dollars in revenue last quarter and currently has a market value of about $5 billion.
Not bad for a company that pivoted five years ago.