A Product Market Fit Show | Startup Podcast for Founders
00:20:26 · Pablo Srugo, Isaiah Granet
[00:20:26] S2: How do you compete with ElevenLabs? ElevenLabs is still big at that point and build your own voice AI from scratch. [00:20:32] S0: Yeah, the CTO of ElevenLabs is an investor and a friend, and I think they built an awesome product. But our job wasn't to build the best text-to-speech engine, it was to build the best engine for enterprises and we weren't focused on out-competing ElevenLabs, and we still aren't. We were focused on delivering the best possible phone calls for everybody, and so for us. What that let us do is narrow in focus and what you have to realize is early days, the distractions are so many. Your only job is to focus, focus, focus, and what people are always amazed by is not what two people can accomplish, it's what two people with focus can accomplish. And so for a founder, you should be saying no to ninety-nine point nine percent of things. That's really your job, and the zero point one percent of things that you say yes to should be your entire all-consuming life. [00:21:22] S2: How long did you have to go heads down just until you got a phone call that sounded real? [00:21:27] S0: Probably a year and a half. So if we started, it became Bland in July of 2023, give or take, rebranded. It wasn't until around October of 2024 that I said, wow, I think we just delivered a very real-sounding phone call. [00:21:42] S2: Did you raise in between or how did you make that work?
00:21:42 · Pablo Srugo, Isaiah Granet
[00:21:42] S2: Did you raise in between or how did you make that work? [00:21:46] S0: So the first problem that we identified, and this is another key part of the focus. Was we identified that this issue of latency. Which is how long does the AI take to reply to you on a phone call, was massive. It was about five seconds for us at the time in 2023. So that was from, you know, you finish talking, AI replies, five seconds and we managed to get it down to three seconds. Which was considered the fastest in the world at the time and our bet was, hey, if we can get it down to 400 milliseconds, it won't make us the best enterprise product. But it gives us an edge and a spike that we can use to drive into enterprises. And so we basically figured out how to get it down to 400 milliseconds. We did this really cool video of me talking to a phone while it's laying on the table and you can see how fast it replies. And then that ended up going mega viral. And we managed to get about $100 thousand of revenue off that ARR in January of 2024. We raised a seed round on the back of that from Upfront Ventures. [00:22:41] S2: Because the VCs already, now they like voice AI at this point.
00:22:44 · Isaiah Granet
[00:22:44] S0: Yeah, I hope Upfront doesn't listen to this. But if they do, I've given them a hard enough time. They passed on us and they had to pay about double the price in January. And we went from $100K to $500K in February, and then $500K to a million in March. And at the end of March, we had about $3 million-ish in the bank. And we decided that we were going to do a really big billboard campaign. Everybody's seen the AI billboards today. There were not AI billboards early 2024, and what we did was we put up a phone number on a billboard. And the whole theory was like, you know, physical marketing can be really effective, especially in a digital world. Nobody puts phone numbers on billboards besides for Jesus or rehab and if we did it right, we could get it to go really viral. And so we ended up spending about a quarter of our total runway to put up these billboards that had a phone number on it and said really simply, still hiring humans? And that billboard video ended up getting now, I think, close to a billion impressions across social channels. Today, that number that we put up still gets about three hundred-ish phone calls a day and we ended up flooding ourselves with meetings. We got to $2 million of revenue by the end of April. We raised our Series A from Scale Venture Partners in June. And then immediately afterwards, we turned around and we fired fifty percent of our customers. And we dropped down to sub a million dollars of revenue, which is a whole other story. But to answer, is momentum carried us so far early 2024.
00:24:11 · Pablo Srugo
[00:24:11] S2: So let's go. I mean, there's a bunch of key moments there that I think are really important. The first one is the January moment where you put out a video and it goes viral. Now you've had time to reflect. Everybody wants to go viral with a launch demo, like everybody, right? And now, it's super polished and there's all these things. First of all, did you engineer it or was it pure luck? What do you think you got right, thinking back to that moment? Because that was the on switch, right? After that, you started to do more of it.
00:24:36 · Isaiah Granet
[00:24:36] S0: Yeah, that's a phenomenal question. My short answer is, is if you're praying for virality, it won't happen. You have to understand the first thing about marketing is that you are never just getting attention. What you're actually doing is you're trading. You have to offer some value in return and for us, there was a lot of thought that went into this whole campaign. So the first video, we shot it on Christmas. It was all through Christmas Eve. My poor head of marketing, who was our third hire, was filming it and we went back and forth seven times. And the video, the whole thing that we wanted to do and we focused on was show the latency. And we did it with a little bit of controversy. And you always have to have a little bit of controversy. So we showed the latency, and then we made the call about politics. So we made the call a political survey phone call, specifically to get people engaged about the content and the idea that we were pushing. And we did it very Casey Neistat style, if anyone's familiar. So at the time, 2023 was sort of tail end of a lot of popularity, very plain background. Here's a phone, here's a timer, here's the content that's being said overlaid digitally, and then we put it up, and basically we paid influencers. Which was also not as common in software at the time, to go do reposts of that, and we ended up having it catch and go viral. We did have a lot of tailwinds at the time. Voice AI was so novel and new that just the idea that you could talk to it was so unique for people. And we focused on this idea of it's not a fake demo. This is real, it's here, you can try it.
00:26:07 · Pablo Srugo
[00:26:07] S2: I'm going to ask you for a small favor, a tiny little favor. In fact, it's not even now that I think about it. It's not even really a favor for me. I'm actually trying to help you do a favor for you. Just hit the follow button. You won't miss out on the next episode. You'll see everything that we release. If you don't want to listen to an episode, you just skip it. But at least you don't miss out. So I, you know, there's a few things to point out there. First of all, you have to, I think people miss this. You almost have to latch on to some tailwind that's bigger than you, right? Voice AI is becoming a thing. People are already interested. They're already in that mindshare. You're not taking them to somewhere else. That's huge just from a starting point and then you add in the way that you shot it, right? Where you're copying something that's working. I know, I don't use TikTok all that much, but my understanding is there are these kind of songs that go viral, right? And if you latch onto that song, your odds of going viral with a video go up. It's kind of the same idea. If there's a format that's kind of working right now, you latch onto that. You're just layering odds of virality on the cake and then the third piece. I mean, the influencer one is the obvious one, right? But, a lot of people, I think, jump to that. It's like, let's just get a bunch of people to reshare this video about something that nobody really cares about in a format that's not that interesting. It's not going to happen. You can't just push your way to virality.