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Elan Lee Profile: Our Notes from his MFM Appearance

When Xbox's Chief Design Officer decides to leave his prestigious tech job to create a "stupid card game," most people would call it career suicide. Not Elan Lee. After watching his niece and nephew completely ignore him while playing an Xbox game he designed, Lee had an epiphany: digital games were isolating people rather than bringing them together. This moment sparked a mission to create games that reconnect people face-to-face—a mission that would eventually build Exploding Kittens into a $100M+ global empire that sells a game every 6.4 seconds worldwide.

🎙️ EPISODE SNAPSHOT

Ever wondered how a simple card game featuring exploding felines could raise $9 million on Kickstarter and transform into a $100M/year business? In this episode of My First Million, hosts Sam Parr and Shaan Puri interview Elan Lee, whose journey from Xbox executive to board game mogul reveals counterintuitive strategies for product development, community building, and retail domination that apply far beyond the gaming world.

💡 KEY TAKEAWAYS

• Community Over Cash: The Kickstarter campaign wasn't about funding—it was about building a passionate community. They reached their $10,000 goal in 7 minutes and ultimately raised $9 million by treating backers as co-creators rather than customers.

• The Anti-Marketing Playbook: Instead of traditional advertising, Exploding Kittens relies on grassroots strategies and deep retail understanding—Lee even plans to work as a Walmart associate to study in-store customer behavior.

• "Creativity Loves Constraints": Limited resources forced innovation that big budgets might have stifled. Their initial constraints (minimal card types, simple rules) became their greatest strengths.

• Games Should Create Tension, Not Just Fun: The core design philosophy centers on creating memorable social moments through tension and stakes, not merely entertainment.

• Playtest Everything: From game mechanics to business strategies, rigorous testing with their "Kitty Test Pilots" community turns good ideas into market-dominating products.

🛠️ TOOLS & RESOURCES MENTIONED

• Kickstarter: Used not just for funding but as a community-building platform that turned early adopters into evangelists.

• Kitty Test Pilots: A proprietary group of 10,000+ superfans who beta test new games and provide crucial feedback before full production.

• Retail Analytics: Custom systems for studying in-store behavior and shelf optimization that maximize "sales per square inch."

• Distribution Centers: Strategically located facilities near manufacturing hubs to minimize shipping times and avoid tariffs.

• The Exploding Kittens App: Digital version that serves as both revenue stream and marketing tool for physical products.

💼 BUSINESS IDEAS & OPPORTUNITIES

• Leverage Irritation: Notice personal frustrations in existing products? They're gold mines for innovation. Lee turned everyday gaming annoyances into multi-million-dollar product features.

• Community-Driven Product Development: Create feedback loops with super-users before finalizing products—Exploding Kittens doesn't release games without 80%+ approval from test pilots.

• Retail Space Optimization: Think like retailers do—in terms of "sales per square inch." How can your product maximize revenue per shelf space to become irresistible to stores?

• Hybrid Physical-Digital Experiences: As screen fatigue grows, businesses that combine tactile experiences with digital convenience are poised for growth.

• Geographic Co-location: Placing offices near distribution centers reduced Exploding Kittens' shipping times dramatically—a competitive advantage in any physical product business.

📊 STATS & TRENDS WORTH NOTING

• Kickstarter Performance: $10,000 goal → $9 million raised (900x target), demonstrating the power of community-driven funding for physical products in a digital age.

• Sales Velocity: A game sold every 6.4 seconds globally—proof that board games are far from dead despite smartphone ubiquity.

• Physical Games Renaissance: Despite digital dominance, there's massive demand for face-to-face social interaction through physical games.

• Company Growth: From 3 founders to ~100 employees in 10 years with global offices, showing sustainable scaling is possible in "old-school" industries.

• Market Dominance: Holding 4 of top 5 best-selling games worldwide indicates category ownership is still achievable for startups against established players.

🔑 ACTIONABLE STRATEGIES

The Kitty Test Protocol

1. Start with Family: Test with relatives first (they'll be brutally honest)

2. Local Game Stores: Get feedback from strangers in familiar environments

3. Target Parking Lots: Observe real-world customer behavior

4. Critical Metric: 80%+ spontaneous laughter required for game approval

Retail Shelf Warfare

1. Study the Environment: Understand store layouts and customer flow

2. Color Psychology: Use bright, distinctive packaging (Exploding Kittens uses orange)

3. Prove Sales Velocity: Show retailers concrete numbers from smaller venues

4. Go Where Competitors Won't: Work retail jobs to gain insider knowledge

Community Building Blueprint

1. Turn Customers into Co-creators: Give early adopters ownership in the process

2. Create Exclusive Test Groups: Make product testing feel like membership in an elite club

3. Implement Feedback Visibly: Show the community their ideas matter

4. Foster Competition: Create leaderboards and recognition for top contributors

📝 EXECUTIVE SUMMARY

The Exploding Kittens story demolishes conventional wisdom about digital domination and marketing budgets. What started as a $10K Kickstarter goal became a $100M+ empire through counterintuitive strategies: embracing constraints instead of fighting them, building community before scaling product, studying retail psychology firsthand, and designing for social connection rather than mere entertainment. By treating business as a game—with clear rules, feedback loops, and playful innovation—Elan Lee transformed a simple card game featuring cartoon cats into a global phenomenon that sells a unit every 6.4 seconds. The lesson? In a world obsessed with digital, companies that create meaningful face-to-face interactions might just have the winning hand.

Watch the full episode here: