Published in Macalester Today
There’s a plaque in the Leonard Center recognizing basketball players who scored 1,000 points or more during their Macalester careers. The name of TJ Mahony ’99 is not among them. Now the CEO of FlipKey, a vacation rental website recently sold to TripAdvisor, Mahony tells the story: “I got 998 points in my college career. In my last game, the coach wasn’t aware how close I was to the milestone, so he took me out with two and a half minutes left.” Although Mahony admits he’s “a little bitter” about his near miss, he says with a laugh that “it makes a good story to tell on myself.”
Striving for the goal but never taking himself too seriously: That aptly describes Mahony, who has experienced some dramatic career ups and downs. He remembers moving to Boston to work at ZEFER, an Internet consulting company. “It was a classic dot-com story arc,” Mahony says. “The company grew from 5 employees to 700 in two years, and shrank back to 50 the next year. I collected unemployment and worked construction jobs, riding my bike to Beacon Hill and working in these really nice homes,” says Mahony, adding, “I now own a home on Beacon Hill, so I guess it all came full circle.”
The rise from bike-riding unemployment to entrepreneurial success story has been marked by Mahony’s love of critical thinking and strong desire to understand what drives the marketplace (“I don’t use my economics degree every day,” he jokes, “just every other day.”) His mindset is evident when he describes the company he founded in 2006, a vacation rental site that features 170,000 properties in 8,000 cities. Mahony sees something beyond the stats: “FlipKey is really a model of collaborative consumption,” he explains. Citing examples such as eBay and Zipcar, he says, “The idea is that what you own can be shared and turned into a productive asset. And what better asset do you have than your home?”
FlipKey began with Mahony’s observations as a business road warrior working for digital marketing firm Compete.com. Thanks to a demanding, high-travel job he was rarely home to enjoy his new house. “When I made my first mortgage payment and figured out how many nights that month I’d actually slept at home, I realized I was paying about $400 a night,” says Mahony. “I began to wonder what would happen if I could make money from my empty house when I wasn’t around.”
His concept was similar to VRBO and Airbnb yet distinct in that it included the vacation rental industry’s first verified guest review system. To get his new company off the ground, Mahony and partners raised half a million dollars through friends and family. Macalester economics professor Karl Egge and some Macalester alumni were early investors, he says, noting that they “realized a significant return in a relatively short period.”
Egge describes Mahony as “intense, hard working, and fun loving,” adding that with the success of FlipKey, “he hit a home run.” Says Egge, “I think of TJ as both among my top 25 favorite former students and a friend.” Says another Mac investor, Fernando de Oliveira ’99, senior vice president for investment firm Brown Brothers Harriman, “I wish I’d invested much more in FlipKey. At the time, TJ told me that he wanted the amount to be small enough so that if he lost the money, our friendship wouldn’t be impacted. Too bad I listened to him.”
FlipKey was acquired last year by TripAdvisor—for an amount Mahony will only describe as a “positive exit”—and its founder will step down as CEO later this year. “It’s the fun cycle of being an entrepreneur,” Mahony says. “Now I get to pick my next opportunity.” He hopes that whatever it is, it will, like FlipKey, be a good place to work (the company enjoyed a 95 percent employee retention rate). “We spend over half our waking lives at work,” says Mahony. “To create jobs that people love, so their personal and work lives blend together seamlessly and painlessly, is something greater than creating a company.”
Last year was a big one for Mahony, who spent 2012 getting engaged, starting a family, buying a house, and selling his company. He and his fiancée, Jessica McKillop, who teaches sixth grade English, have a baby due in May and a wedding planned for June 2014. “I guess we did things in reverse, but that’s a typical independent mind coming out of Macalester,” he says.
Mahony’s entry into life at the college he now loves was challenging. “I came from Boulder, Colorado, where winters are warmer, and my first year, 1995, was brutal,” he says. “I was so homesick and cold that I requested transfer papers. But I never completed them because by then I’d fallen in love with Macalester.”
Once Mahony warmed up, both literally and figuratively, he got “my first exposure to truly independent thought. It was not just one professor or class, but the entire ecosystem, and the peer group that surrounded and pushed me, too. I’ve been working in Boston for almost 15 years now, and I’d put Macalester grads head-to-head against people from MIT, Harvard, and Amherst.”
Mahony still visits the Macalester campus when he drops in to talk to Egge’s “Deals” class. When he lectures, he always shares two bovine-themed business observations. “First, I say, you need to be the purple cow in the field of ordinary cows. If you’re going to do something, do it better than everyone else and stand out—don’t blend in.”
And then, in the spirit of a man who has already created and sold one highly successful company, he tells the students this: “If you want the cheddar, you have to own the dairy farm.”
Julie Kendrick is a Minneapolis writer and a regular contributor to Macalester Today.