Two friends launched an online White Elephant Gift Exchange in 2020; 5 years later, their holiday side hustle had surpassed $1.5 million in revenue

When the pandemic disrupted office parties in 2020, David Mancarella wondered whether people could play White Elephant online. He couldn't find a suitable platform, so he decided to build one with his wife, Leliah Kishbaugh, and engineer Andrzej Brynczka.

Their website launched in November 2020. By the end of that year, it had attracted more than 165,000 users. Five years later, White Elephant Online had served over 350,000 users and generated more than $1.5 million in lifetime revenue.

The business has remained small, with the three co-founders handling its operations. Its appeal also lies in an unusual feature: most of the work happens during the holiday season.

An office holiday tradition led to a business idea

In August 2020, Mancarella was working remotely as a director of product management at a New York City property technology company. His colleagues began discussing how they could continue their annual holiday party, which included a White Elephant gift exchange.

The game involves participants exchanging gifts, often taking presents from other players. Mancarella thought it should be possible to recreate the experience online.

After searching for an existing service, he found that the option he had imagined wasn't available. He discussed the idea with Kishbaugh at their home in Bethlehem, Pennsylvania, and contacted Brynczka a few days later.

The three moved quickly. They wanted to launch before Thanksgiving, when demand for holiday games would begin to rise.

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The first season brought more users than expected

White Elephant Online initially offered free personal games for groups of up to 25 people. Corporate customers paid $99.

The response was much larger than the founders had anticipated. By the end of 2020, more than 165,000 users had visited the platform.

The quick launch also brought technical problems. One glitch automatically entered customers' first names in both the first-name and last-name fields, generating hundreds of customer service tickets.

The founders developed support materials and introduced Zendesk to manage customer queries. The experience showed how a simple online product can create a substantial support workload when thousands of people arrive within a short period.

Mancarella left his product management job in the spring after the launch. He and Kishbaugh eventually began treating the venture as a “quasi full-time business.”

Corporate customers became an important part of the model

White Elephant Online has since changed its pricing. Personal games remain free for groups of up to 10 players, while businesses and organizations pay between $69 and $299, depending on the number of participants.

The model gives the company a way to serve both family gatherings and workplace events. For businesses, the platform offers a ready-made way to organize a virtual activity without building one themselves.

The founders' reported $1.5 million in lifetime revenue reflects the money the business has generated over time. It doesn't mean the company earned that amount in profit or that the founders personally took home the same sum.

ChatGPT helps the founders examine gift trends

As the business accumulated years of gift-exchange data, the founders found another use for it. They began using ChatGPT to analyze gift information and look for patterns that would take longer to investigate manually.

The platform itself doesn't use AI to operate its gift exchanges. Instead, the founders use the tool behind the scenes to help understand which gifts attract interest.

Some choices are practical, while others fit the playful spirit of the game. According to the founders, Snoop Dogg's cookbook From Crook to Cook: Platinum Recipes from Tha Boss Dogg's Kitchen has ranked among the platform's top 10 gifts every year. Apple AirTags and Bluetooth speakers have also remained popular.

The company has also launched a gift idea generator. It serves people looking for presents whether they play White Elephant online or in person. The tool earns revenue through affiliate links.

White Elephant Online's busiest period runs from September through December. That schedule gives the founders flexibility during the rest of the year, but it also limits the time available to test new features and prepare for peak demand.

Kishbaugh and Mancarella previously used their quieter months to travel in a camper van and visit national parks. They now also value having more time with their daughter.

Their advice to other aspiring entrepreneurs is straightforward: put a product in front of people instead of spending too long planning it. Kishbaugh also says founders need to be careful about where they spend their time, even when they enjoy handling different parts of the business themselves.

Five years after its launch, White Elephant Online has grown from a pandemic-era idea into a business with more than $1.5 million in lifetime revenue. Its next challenge is to find more ways to reach customers beyond the holiday season while continuing to serve the gift exchanges that built its audience.