How Adjusti CEO Alon Maltzov grew Adjusti to $120K revenue and 10 customers in 2018.

hello everyone my guest today is on maltsov he's an experienced global product manager with a demonstrated history of working in the financial services industry today he's building his tool called a justico we're going to jump in that into that today alan are you ready to take us to the top yeah let's do that all right tell us about the company what do you guys do and how do you make money provide live insights on your competitors marketing strategies as everyone know marketing becomes extremely personalized meaning that each of every one of us will be exposed to different marketing campaign according to our interest demographic and so on this creates a big issue for companies to basically monitor their competitors because for example i could never be exposed to a campaign that is targeted to a 13 years old girl from let's say new york if you put yourself in the shoes of a company as marketing become more personalized it's almost impossible to deny your competitors and this is what we do basically we take your company name we find all of your competitors uncover all of the marketing material by simulating real users from different geolocation device and different user segment and we basically provide you the data so if one of your competitors approached a new customer segment if he made some changes in his pricing plans about any new landing page and so on ajastico will make sure that you know your competitors everywhere and alan what's tougher the work you did in the israeli air force or launching a justico um launching a justice for sure tell us just a little bit so we can get more inside your brain what did you do at the israeli air force so in these early efforts i walked in a special unit that basically uh fixed head missiles um in every missile there is like the engineering part so we used to fix that for the army it's a bit classified but at the end of the day i submitted uh i think six uh proposal uh offerings and uh four of them got approved um right after my army service i joined the my check which is a mobile payment app i was the seventh employee if i'm not mistaken did you get out uh i did good a bit um where i started as a trainer as an account manager in the israeli market and then i got promoted and established the uk market with one of my manager so i moved to london and back and forth to israel after the second round my ceo and manager moved each of them one to the to new york and the other to london and i had to stay in israel so i decided to start my degree why did you have to stay um i had three off up offers basically um either to move to new york uh as a new position stay in israel um and work as a global project manager or move to uh to london as a ceo um i decided to stay in israel and start my degree during uh that time so i moved to the product department worked under the vp of product and started working on product for not just the uk market but for everyone and what were you studying i studied business in the international school at idc um where the around 80 ap uh people around the all over the world so i have friends from london uk um us brazil singapore and so on so it was a great experience and in my last year i joined the zeal entrepreneurship program which is one of the best programs here in israel for young entrepreneurs where at the end of at the last year of the studies they basically uh the chosen 24 out of 2000 that can apply and they divide the same to teams and starting working on the venture basically think about it as the an x-men class where you have all the best students here at idc and most of them has a lot of experience uh working on different ventures and we're creating our own teams we are working on ventures this is where i met my co-founder or novi he's a programmer from the idf has a lot of experience worked on different ventures in marketing we started to work on different ideas it's a bit weird because it's the other way around from the industry where you have the the team but now you need to come up with an idea so we had fewer iterations and we started our idea with a different approach we understood that marketers today when they are performing their a b test they are basically choosing randomly if the call to action will be purple or red for example they basically creating two landing pages with two buttons divide the traffic and see if what works best we said okay let's uh automate this process so we went to few uh potential customers and sold that product they told us that design could be interesting it won't change the conversion that much contact will and for us it's a bit harder to do so but in every meeting they kept bringing that if you have that on my competitors i'm willing to pay now well as a young entrepreneur with no money we decided to start with that was your was your bank literally at zero um we are without salary for i think 12 months at this moment but did you save up a cushion from my chest yeah okay yeah so yeah you did it the smart way yeah i had to do that um and now we are you know in the last few that we have we're raising money good okay so how much are you raising right now so right now we're raising two million dollars um uh just a bit uh background about the company we started working on this hold on hold on close that out though hold on real quick so you're raising two million are you gonna do it on a note or you're gonna sell equity uh we're gonna sell equity okay so it's gonna be a straight equity deal and and i know you're still probably negotiating but ideally what valuation would you like to raise at so we are willing to give it around 20 to 30 meaning the valuation is around seven to eight million dollars um free money and yeah yeah yeah okay very good so let's get more of your backstory now um let me first i want to understand the purchasing behavior some of these first customers so today on average what are customers paying for the tool so we started with uh just a few design partners so right now we have 10 and 57 in the pipeline we decide not to add them because we just just don't have enough manpower to uh help them um we're spending a day every week just to supply the weekly report that we are generating um they are paying a monthly fee that ranges from uh 3 000 to a thousand dollar um actually the last customer that we signed is uh paying a thousand dollars for our alpha version okay um we believe that uh in the future it will range between a thousand to five thousand even a ten thousand uh monthly um and it pretty much depends on the number of competitors the number of uh uh geolocation that you like us to monitor and the number of uh again everything is benchmark according to the industry uh similar web for example starts with uh a thousand dollar monthly but you can only pay annually so it's twelve thousand dollars annually um and what are you adding out today in terms of total customers that are working with you so we have 10 working with us and 57 that are pending meaning that they are asking for the product we cannot why do you call them why do you say 10 does why do you use the word design partners instead of just 10 there's 10 customers right so we are looking at them as most design partners and and not just customers because at the end of the day think about that that all of our back end is fully developed now we're working on our front end and from our experience we don't know exactly what each company wants to see so we're aggregating all the data and understanding with them what they would like to see meaning that we have bi-weekly meeting with them we're learning from their experience and their use of the product how to design and better prepare our next version so 10 peop 10 customers you set up on minimum they're paying a grand per month so what you guys are doing about 10 grand per month right now is that right yeah something like that okay good so 10 grand per month or 120 grand per year when you're going out to raise and you're trying to fight for a seven million valuation what are those conversations how are they going so far you know at the beginning it's uh the value we're not talking about valuation at the end of the day when you're raising seed it's raising up for basically they're trusting the team um we're coming with a lot of experience that's a big seed though two million seed i would say is that's a pretty big one right um so we uh decide to wait until we have 10 customers uh design partners and we have some on the pipeline meaning that people are want our product and we cannot deliver it this creates a bit of pressure um part of our background and so on um we build the presentation we build a an amazing budget that is detailed to what we want to do what we want to achieve we want to spend the money on so at the beginning it's three developers that we're bringing it's drill two we know who they are meaning they're just waiting for the money to join our team um this is how we're preparing and how many how many people are on the team right now uh just now just two of us two of you okay good and and you just launched i mean 2018 was launched yeah okay that's great so two months two people if you raise two million you bring on three developers anyone else you'd hire yeah so the first six months...