You couldn’t make up a better tale about a wayward kid who makes good than Dan Berger’s story.
Grows up in Israel. Moves to the United States at age 9 with his parents. Thrown into a strange school. Doesn’t speak the language. Doesn’t fit in. Plays on his computer until dawn, nearly flunking him out of the prestigious Bronx High School of Science. Sells drugs. Takes drugs.
Berger eventually righted his life. He graduated from New York’s Hunter College with a bachelor’s in political science. He followed that up as a point man for former U.S. representative Charles Rangel (D-N.Y.), and then received a master’s in business from Georgetown University.
He now runs a D.C. technology/hospitality company he invented called Social Tables. It has 102 full-timers, a band of prestigious investors, and gross revenue that I would place between $15 million and $20 million.
Social Tables builds soup-to-nuts software that allows hotels and other venues to map logistics for events — from a small board meeting to the 3,000 faithful who attended a Philadelphia gathering for Pope Francis.
Social Tables software staged more than 800,000 events last year.
About 80 percent of the company’s revenue comes from hotels and venues to plan events and for sales. The other 20 percent comes from meeting planners in need of space and logistics help.
“Our software takes an empty space and turns it into a memory, a speech or an experience that stays with you,” Berger said. “People are spending so much time on computers that when people finally get together face to face, there should be a good outcome.”
Like most digital disrupters, the software’s other purpose is to save money for clients by slashing the time and labor it takes to organize and stage an event.
Instead of phone calls, emails or cumbersome meetings where 20 people are moving miniature tables and chairs around conference tables, “you can have 10 people looking at the same event on the computer, moving different things and doing it in real time,” Berger said.
I didn’t even know businesses like this existed. I thought you rented a room, threw some tables in there, put up a bar, and away you go.
But if you hope to raise millions at your 500-person annual dinner, you want it to come off as smooth as a Fred Couples golf swing.
“The days of the emails are over,” Berger said. “The days of the endless phone calls are over. The days where you moved blocks around a table are over.”
Social Tables’ 5,000 clients include the InterContinental Hotels Group, the Smithsonian Institution, more than 400 colleges and universities, the National Football League’s Dallas Cowboys, Hyatt Hotels and even the aircraft carrier USS Midway Museum, which is anchored in San Diego.
This is big business anywhere, but especially in an event-rich environment like Washington.
Berger owns the single largest stake in the privately held business. The others include Bessemer Venture Partners, Questmark Partners and Thayer Ventures.
Social Tables expects to be profitable by early next year.
Social Tables is another of those disruptive Washington companies that have wedded technology with old-fashioned businesses. Think Custom Ink, Marc Katz’s successful online T-shirt company. And Optoro, which develops software enabling big-box retailers to redirect unsold inventory to eBay and Amazon.com.
Two powerful words sum up why I think Social Tables is going to make it: recurring revenue.
Clients subscribe to Social Tables software on an annual basis, paying from $3,000 to $20,000 a year, depending on how much software they buy and how big they are.
The beauty of the recurring revenue model is that once you build your product, you sit back and wait for your revenue stream to grow as the subscriptions pour in. The only big cost is customer service and the 40 high-priced engineers who are beavering away on the next version of Social Tables software.
Social Tables clearly runs on Berger’s unsettled energy.
He moves rapidly. So does his Mach 2 velocity speech. The Social Tables logo is tattooed on his right forearm.
During one phone call, he kept me on the line for five minutes while he negotiated on another line — out of my earshot. He tapped out a multiyear contract worth $12,000 to $25,000 a year for a major Las Vegas venue.
“If you need this, I can get it done by end of month,” he said to the customer on the other line. “Let me put together a draft to see what it’s going to cost. You give a verbal and written, we send over all the contracts. I will have a timeline put in that. You have my promise this will go well.”
Grabbing him for an interview was like picking up spaghetti with a spoon. Phone calls set. Canceled. Rescheduled. Canceled. Set. Canceled.
I walked over to his offices near Metro Center at 5 p.m. on the only warm, sunny Friday afternoon we’ve had in months and planted myself.
He gave me an hour.
“I was a troubled kid,” he said, sitting in a comfy corner of his loft-like workspace. “I messed with the wrong crowd.”
Berger’s parents, both social workers, ripped him out of Bronx Science for poor grades. But he had a knack for computers and took to the Web early. He would sit for hours on his home-built desktop, constructing Web pages for $25 an hour.
He made thousands a year while attending Hunter College. He graduated in 2004.
He spent the next few years doing constituent work for Rangel at $35,000 a year.
“I got to work in the heart of Harlem and learn its entire culture,” he said. He worked in an office with nine people, handling everything from development to housing vouchers. He met bigwigs such as Al Sharpton and Bill Clinton, but he learned quickly that local politics is about working with the little guys who get things done. He learned another lesson about voters that has stayed with him in business: Never say no to a customer.
“All the stars in local politics are people you never heard of,” he said.
He left Rangel’s office to get his master’s in business from Georgetown. He graduated in 2010 and took a job with Booz Allen for $90,000 a year.
Berger was restless and bored at Booz. He compiled a list of 20 business ideas. Macho Flowers would tap a new market by convincing men that flowers are cool. Then there was an online site for microwaveable meals.
On a flight to Miami to attend a wedding in 2009, Berger began scribbling the rough outlines for a business that allowed wedding guests to find out the backgrounds of others at their tables. The premise was that if you knew more about the person sitting next to you, it would make conversations more interesting.
“I started building it on nights and weekends at Booz because I was bored,” he said. He attended a bridal dress sale, where he distributed one-page handouts describing the software with a visual chart and brief description for each table guest.
He promoted it on Facebook. He distributed Social Tables free through people he knew online. It started getting buzz. One bride picked it up. Another picked it up.
In March 2012, an event planner paid him $300 for the software. He didn’t know what to charge, so he made up the amount.
He hired an employee, a former LivingSocial sales operations staffer named Trevor Lynn, who started buying Google AdWords. The business expanded.
“People started using it, not for the seating chart, but for the tools to plan an event,” he said.
Berger quit Booz Allen in summer 2011, living for the next two years off his savings and off income from a New York rental property that his parents owned. (He currently makes a six-figure salary.)
In November 2012, he got a call from the Latin Grammy Awards, asking to buy a one-year subscription to the event-planning software for its ceremony in Los Angeles. Price: $700.
“I remember to this day, watching on a computer screen as people streamed into the ceremony and found their seats, one at a time,” Berger said. “That’s when I knew I had a business.”