- Sean Parker is an American entrepreneur whom most associate with the music-sharing platform Napster. After Napster was shut down, he founded the address book and social networking service Plaxo in 2002.
- Parker then became the founding president of Facebook in 2004 after an acrimonious departure from Plaxo. He was instrumental in transitioning the young social media platform into a viable company.
- Parker was forced to step down as Facebook president in 2005 after an arrest for drug possession in North Carolina, but he nonetheless retained a significant shareholding and informal involvement with the company. He then worked with Peter Thiel at his venture capital firm for a time and then moved into philanthropic efforts.
Education and early career
Sean Parker is an American entrepreneur whom most associate with the music-sharing platform Napster.
Parker founded Napster with childhood friend Shawn Fanning and the service was launched in June 1999 while the pair were still teenagers.
Napster’s ultimate demise in 2001 is well documented, but let’s discuss this event in the context of Parker’s professional life and the direction it has taken before and since.
At the age of 16, Parker won first prize in a science fair for a web crawler he developed and received a subsequent offer to work for the CIA.
He ultimately chose to take up a position at Washington D.C. start-up Freeloader under the then-CEO of Zynga Mark Pincus.
This was followed by a brief period at UUNet, an early internet service provider.
Parker graduated from high school in 1998 and was making around $80,000 per year.
He realized that he neither wanted nor needed to go to college and used his attractive salary as justification to put off any thoughts for college for twelve months.
Parker would spend much of his teens hacking and programming and once was busted by the FBI for hacking into a Fortune 500 company.
He met fellow hacker Shawn Fanning at some point with the pair realizing they shared other interests such as theoretical physics.
Fanning and Parker then founded an internet security firm called Crosswalk which provided consultancy services to companies who may have otherwise been in their crosshairs.
While Crosswalk turned out to be a failure, the pair had an idea that would change the face of the music landscape forever.
Fanning came up with the idea of a P2P platform where users could share files, and after learning of the concept, Parker wanted in immediately and became the company’s co-founder.
The pair then moved to San Francisco after securing investment capital, and in an interview with the Financial Times, Parker exultantly described what happened next:
“I got on my hands and knees and installed all the servers for six weeks, got introduced to my first business people and hired them and fired them, and was sued by the record labels and suddenly I’m on MTV and now we’re sponsoring raves and going to crazy parties and then bigger and bigger and bigger.”
While the inexperienced Parker had to navigate intellectual property law, entrepreneurship, and corporate finance, it is likely that a series of emails where he admitted Napster users were stealing music caused the platform’s demise.
Parker founded the online address book and social networking service Plaxo in 2002.
The service, which was integrated with Microsoft Outlook, was a forerunner to companies such as Facebook and LinkedIn.
It was also one of the first companies to incorporate viral marketing into a product launch, securing 5 million users in the first three years of operation.
Parker was fired from his own company just two years later by Sequoia Capital and Indian-American investor Ram Shriram.
The reasons for his ousting have never been fully disclosed. Some posit that it was due to the dot-com bubble downturn, while others believe Parker had a sporadic or erratic interest in Plaxo itself.
Whatever the reasons for his exit, Parker maintained an interest in social networking and joined a fledgling company called Facebook later in 2004.
The company was in those days confined to college students, but as its founding president, Parker became one of the main drivers of transforming Facebook into a viable business.
For example, he hired former Napster employee Aaron Sittig to design the Facebook website that most recognize today.
He was also responsible for working hard to purchase the Facebook.com domain name and secured Peter Thiel as the company’s first investor.
Parker was forced to step down as Facebook president in 2005 after an arrest for drug possession in North Carolina.
He retained a minority stake in Facebook that was worth hundreds of millions of dollars and continued to be informally involved with the company.
Parker then joined the venture capital firm Founders Fund as a managing partner in 2006. There he once more crossed paths with co-founder Peter Thiel, who afforded Parker free reign to invest in any company he saw fit.
Parker joined Founders Fund because he resonated with Thiel’s maverick methods. Unlike most other VC companies that are run by those who have never launched their own ventures, Thiel ran Founders Fund from the point-of-view of an entrepreneur.
Parker stepped down from his role in 2014 to focus on other projects. During his tenure at the company, he made a $15 million investment in Spotify because of a personal desire to see Napster’s music-sharing heritage continue.
One of these projects was Causes, a for-profit civic technology app and website that Parker founded in 2007 with social entrepreneur Joe Green. The Causes website enables users to organize public awareness and grassroots campaigns around causes they are passionate about.
They can also respond and comment on popular topics, new legislation, and breaking news, or contact their local representatives about an issue. When the Facebook app was first launched in 2007, it relied on word-of-mouth marketing at scale to grow to 186 million users by 2013.
As a mutual investor in both companies, Parker was instrumental in the Causes acquisition of advocacy start-up Votizen. The deal was based on a belief that together, both companies could reach nearly every voter in America.
Parker also noted at a Techonomy conference that he was interested in “trying to leverage social capital to effect some kind of social change, whether it’s in electoral politics, or activism, or advocacy, or raising money.”
During his tenure at Founders Fund, Parker made a $15 million investment in Spotify because of a personal desire to see Napster’s music-sharing heritage continue.
He was first introduced to Spotify by a friend in 2009 and was thus prompted to send an email to company founder Daniel Ek. The contents of one particular email surfaced several years later where Parker more or less pitched his interest.
The email, which totaled thousands of words and also discussed Parker’s Napster experience, opened with this introduction: “I’ve been playing around with Spotify. You’ve built an amazing experience. As you saw, Zuck really likes it too. I’ve been trying to get him to understand your model for a while now but I think he just needed to see it for himself.”
Parker’s initial investment in 2010 was followed by seven years on the company’s board. During that time, he introduced Ek to American investors and reportedly negotiated with Universal and Time Warner on Spotify’s behalf.
His time at Spotify was clearly productive, but it was also personally meaningful. At the Web 2.0 Summit in 2011, Parker described the platform as an “attempt to finish” what he started at Napster and realize his dream of a “frictionless-free, tiered service that enables music sharing.”
Parker and Fanning launched Airtime in 2012, a group video, audio, and text chat platform.
The web launch was announced in a press conference accompanied by celebrities such as Martha Stewart and Snoop Dogg. However, the service did not gain significant traction.
Airtime was relaunched in 2016 as a mobile-first app where users can play party games or share files, links, and their screens with friends.
In April 2014, Parker announced his formal support of an initiative called Brigade, a civic technology platform where users of a similar political persuasion could connect, share opinions, and organize petitions.
Parker contributed to an initial $9.3 million in funding to Brigade and served as its Executive Chairman, holding a firm belief that politics was the next industry to be disrupted by the web.
Also participating in the seed round were venture capitalist Ron Conway and Salesforce founder Marc Benioff.
In 2014, Brigade took a majority position in the holding company that owned Causes and Votizen. Parker was once again instrumental in the deal, which was primarily motivated by declining interest in the Causes platform after Facebook went mobile.
With Parker’s various interests and connections in all three companies, he stepped down as interim Brigade CEO but remained its chairman. The venture was successful for a time, with over 250,000 people using the platform’s ballot guide in the 2016 election.
However, by 2019, the company’s top personnel were not satisfied that Brigade had scaled to its full potential – especially after two full election cycles. The company was shut down later that year and while Parker’s team did not disclose the details, it is likely that he and several other early investors in the various companies were adequately compensated.
As part of the shutdown, Pinterest acqui-hired Brigade’s employees while its assets were sold to Countable, a GovTech SaaS provider that helps government and enterprise manage their communities with engagement tools.
The Parker Foundation was established in June 2015, with Parker making a $600 million donation to the philanthropic organization that focuses on art, civic engagement, public health, and life sciences.
He donated a further $250 million to the Parker Institute for Cancer Immunotherapy in April 2016, with the funds disbursed to over 300 scientists across 40 laboratories.
The institute has recently found a link between skin cancer and microbial diversity in the gut and has conducted immunotherapy clinical trials for melanoma patients.
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