- Grindr CEO George Arison said he is keeping the company's telemedicine venture as small as a "founding team" for now.
- Arison told Business Insider that projects incubated in big companies "usually fail" because they "try to do too much."
- The venture, Woodwork, only has three employees and is operating with constraints that Arison said were deliberate.
It's not just Mark Zuckerberg who's in "startup mode" these days. Grindr CEO George Arison is deliberately keeping the company's fledgling telemedicine business, Woodwork, small in the hopes that it will give it a bigger chance of success.
Grindr announced its telemedicine venture Woodwork, which offers erectile dysfunction medication, in May. The service started small, only available in Pennsylvania and Illinois.
Arison told Business Insider that the scaled-down nature was by design. He wants Woodwork's leaders to operate as a "founding team of a company" — and not get overfed by corporate resources.
"It's a very small nimble team," Arison said. "We could easily give them two more people and wouldn't really make a difference to the Grindr parent company, but you don't want to overstaff something like that."
Woodwork has three full-time employees, Arison said.
Arison also didn't want Woodwork to have access to too many users, which led to his second constraint: restricting advertising. While painting the Grindr app with Woodwork ads would be a low-cost expansion option, Arison said it would be bad for the health of the business.
"I don't want them to have unlimited access to people on the product," Arison said. "I actually want to limit them to users so they can ensure they can learn from every single user that they're engaging with."
With the product rolled out in two states, Arison said it was "enough users where you are learning every day, but not too many where you think you're growing when in reality you're not really growing well yet."
Meta has also looked to replicate a startup-like ethos with its superintelligence AI unit, though on a much larger scale — and talent budget — than Woodwork. Meta famously poached some AI employees for hundreds of millions of dollars, though the team remains small relative to the broader company.
Mark Zuckerberg said on a recent earnings call that he has "just gotten a little bit more convinced around the ability for small, talent-dense teams to be the optimal configuration for driving frontier research."
Snap is also looking to lean into "startup energy." CEO Evan Spiegel wrote in his annual letter to employees that the company faces a "crucible moment" and is reorganizing some of its employees to create five to seven groups of 10 to 15 people, or "squads," to operate as "startups" inside Snap.
Spiegel wrote that he hoped to use the "squads" to promote "focus, accountability, and hustle."
Grindr's Arison, who is looking to build a side business through Woodwork, said the company was taking a "very different approach" from its competitors.
"A lot of the startups that are incubated inside of a company usually fail for that very reason, because they do try to do too much and then it doesn't work out," he said.
Arison's final move to keep Woodwork operating like a startup is to try not to talk about it much on earnings calls. He said that he wanted to "isolate them from the pressures of us being a public company."
"I told the street, 'Hey, I'm not going to talk about Woodwork very much for the next few quarters until there's anything useful to say because we want that team to have the ability to function on its own and have the luxury of time to execute,'" Arison said.
Some might not have listened. Arison said that, after a recent earnings call, some said that Grindr was "deprioritizing" Woodwork because he didn't reference it.
"I'm not deprioritizing anything," he said. "I'm doing exactly what I said."
