Tech Billionaire Eric Lefkofsky helped launch Groupon and other digital platforms. Now he’s seeking a cure for cancer.
Lefkofsky (above) helped establish tech-based companies, Groupon, Tempus, and more.
Eric Lefkofsky is co-founder and CEO of Tempus, a Chicago-based technology company focused on building an operating system to battle cancer. But Tempus is only the latest in a string of successful startups, like Groupon, that Lefkofsky has co-launched over the years, all initially inspired by his entrepreneurial father.
“I grew up on a street called Coventry Woods Lane (in Southfield), which is off Bell Road, near Lahser Road,” Lefkofsky says. “My father was a structural engineer, and he owned and ran his own firm. My mom worked with him and, growing up, I saw that was an avenue you could pursue — being your own boss, starting your own company — that felt very natural to me.”
When it was time to begin his studies at the University of Michigan, the father of one of Eric’s good friends, who also was attending the university, had a suggestion for the two boys. “He owned a carpet store,” Lefkofsky recalls, “and he said, ‘Why don’t you load up some carpets and put them in a van and see if you can sell them and make some beer money?’ So, we did. That was 1987. And I’ve basically been starting and building companies ever since.”
Lefkofsky and his buddy ran their carpet business for most of Eric’s undergrad years. By the time he graduated from U-M’s law school, he’d reconnected with Brad Keywell, a childhood friend who had followed the same collegiate path. Lefkofsky and Keywell moved to Wisconsin in 1993, beginning what is now a 25-year partnership with an investment in the children’s apparel business.
“We found a manufacturer in Wisconsin,” Lefkofsky says, “and we bought it in 1994 and ran that for about five years, until the market changed. Then we got into the internet in 1999.”
Eric Lefkofsky got his start in the business world by selling carpeting while attending the University of Michigan in Ann Arbor.
Did they ever. After relocating to Chicago, the pair’s first big success came with InnerWorkings, a company created by Lefkofsky in 2001 to disrupt the outdated and inefficient print management supply chain between corporations and their customers. It went public in 2006.
By 2005, Lefkofsky and Keywell had also started Echo Global Logistics, a technology-based enterprise transportation management firm they took public in 2009. The pair hit the trifecta in 2012, when a majority stake in Mediaocean, their advertising-tech services and software startup, was acquired for $720 million.
“By that time, and with those three companies, we had a few thousand employees,” Lefkofsky says. “One of them was a young man, Andrew Mason, who was a very talented software programmer. He’d just left us to go to school at the University of Chicago, and he had this idea to launch a site to help people solve collective action problems, where a group could get together and see if they could achieve something. That was called The Point.”
Lefkofsky made Mason the proverbial offer he couldn’t refuse. “I said, ‘Why don’t you drop out of school and I’ll put a million dollars in and we’ll try to build that idea?’ So, he did. We had a team of 10 to 15 people, but it just wasn’t working. A year and a half later, really out of desperation, we decided to try to pivot from helping people get together to solve problems to helping people get together to save money on everyday things they do and buy.”
The name of the company was changed to Groupon, “and almost immediately, it was a huge success,” Lefkofsky says. “I think in our first year we did like $30 million in sales, and then $700 million a year after, and maybe $4 billion a year after that, so it was kind of this rocket ship over a two- or three-year period.”
So confident were the partners in the potential of their company, they brazenly spurned a $6 billion buyout offer from Google, opting instead for an IPO in 2011 that raised $700 million at $20 per share.
“We had these kind of big, successful companies in tech before,” Lefkofsky says, “but that was our first mega-success, and certainly our first e-commerce business, and we’ve spent the last six or seven years trying to get that business to hit its stride. It’s still a great business and we have high hopes that it ultimately will be the company that transforms local commerce, but the challenge is the growth was so meteoric in the first two or three years that when the growth rate decelerated, which was kind of inevitable, we had to spend time trying to figure out how to reaccelerate that growth rate.”
Typically, even as Lefkofsky and Keywell focused on that challenge, they were also multitasking, launching Uptake Technologies, their fifth company, in 2014. Named the hottest startup of the year by Forbes in 2015, the company specializes in analytics software that helps predict and even prevent failures in an array of industries. “We’re co-founders,” Lefkofsky says, “but it was Brad’s idea and he runs it to this day.”
The partners also oversee Lightbank, a $200-million venture capital fund that has helped launch more than 100 startups around the world, but these days most of Lefkofsky’s creative energies are focused on Tempus, which he founded in 2015. “For me, ideas are born out of trying to find solutions,” he says. “Like millions of other people, I’ve been impacted by cancer.”
Three years ago, Lefkofsky says his wife, Liz, was diagnosed with breast cancer.
“I spent a lot of time in doctors’ offices with her and I was just perplexed at how little technology and data had permeated her care. She was being treated by some incredible physicians, but they didn’t have technology and data at their fingertips. The more I learned about cancer and the more I talked to physicians and researchers, the more I realized how having access to the right data could improve patient care. Aside from my family, it became my single focus.”
For decades, cancer has presented challenges that are complicated and daunting, but the goal of Tempus is simple and clear: Get oncologists the potentially life-saving data they need as quickly as possible, so it can be utilized more efficiently and expeditiously.
Young Eric Grew up in Southfield. His father was a structural engineer who owned and ran his own firm.
“We’ve spent the last 20 years bringing technology to industries that never had a lot of technology,” he says, “and it just kind of dawned on me that there was no industry more in need of technology than health care. I came to the conclusion that the only way to usher in any formal, real personalized medicine — certainly in cancer and maybe in other diseases — was to fix the underlying data infrastructure and get critical data and molecular data flowing freely. So we began pouring a bunch of time and money into that, giving these physicians modern software and other analytic tools so they can actually help these patients.”
Liz has responded well to her treatment. “She’s doing great, so far,” Lefkofsky says. “It’s day to day, but she’s doing great.” She also takes an active role with her husband as co-chair of the Lefkofsky Family Foundation.
“We focus on education, human rights, cultural initiatives, and medical,” Lefkofsky says. “My wife takes education and human rights, we both do the cultural stuff, and then I focus on medicine. Most of the last few years I’ve been singularly focused on cancer.”
Lefkofsky, 48, says his foundation also donates money to “a bunch of charities in the Detroit metro area,” and he’s frequently back in town visiting his parents and family members.
“I think what's been happening in Detroit the last few years is remarkable,” he says. “The city just feels alive and vibrant. There’s an energy. When you talk to people who live there ... they feel life in Detroit is on a huge upswing. It’s been great to watch. I’m good friends with Dan Gilbert, and it’s been amazing to see what he’s done in the city. It’s an awesome comeback story.”
Lefkofsky is quick to credit his hometown for what has been an incredible journey.
“How did Michigan shape and mold me? I would say in every way. I mean, that’s where I grew up, it’s where my family was from and where they grew up. There’s no question that growing up in the Detroit metro area, in particular, everyone around me was hard-working, good, solid, salt of the earth people. All those memories are deeply woven into what I do and who I am today.”