How Aiqudo CEO Rajat Mukherjee grew to $996K revenue and 1 customers in 2019.

hello everyone my guest today is mukherjee he is the founder he's sorry leading product now at a company called iq prior to that he was cto at a different company working on deep mobile search and before that led ecommerce business inside of yahoo small business unit he launched yahoo stores in yahoo commerce central after the acquisition of electricity and before that was product lead at google on various projects from custom search to site search search appliance ads automation and many others all right you ready to take it to the top yeah yeah absolutely all right thanks so having me on of course yeah so tell us what iketo does and how what's your revenue model how do you guys make money sure so we are really about uh helping people get things done so we are about voice to action and the goal is to basically take users from simple voice commands directly into actions that help them you know get things done so we focused a lot on uh mobile apps in the beginning of course we've got bro you know we branched out a lot since then but uh we noticed that there was a big hole in the market in terms of getting people from their voice commands directly into the apps that they use on a daily basis their personalized apps so for example i can call my mom using facebook messenger i can you know communicate with my colleagues using slack i should be able to make a payment to somebody using paypal or venmo and those things were not enabled in the existing platforms so we started focusing on that and now we have a full-blooded platform that helps people get things done quickly we have a metric that we call time to action that helps us you know measure this so that we are true to ourselves okay so you could pick up the aikido app on your phone and say something like tell justin i'm running late for the meeting and it will use whatsapp to automatically send that message absolutely and if you have multiple apps which is another thing that we are you know is a differentiator for us it will give you a choice in the beginning like do you want to use whatsapp or do you want to use a messenger okay but your interface was a mobile app is that right uh actually ours is a platform so yes in terms of delivery to end users it is through other people's apps or through other applications yeah but how do i initialize it like right now on my phone if i'm going to be late to a meeting today and i want to say you know tell them i'm going to be late how do i tell you to tell the app on whatsapp to message my friend who i'm going to be late so right now we have for example a sample app in the app store that you can download for your for your phone but what we've done is we are working with partners like so we are live for example with motorola so we are powering motorola's moto voice product the actions there so you can that is that comes built into the phone so we are working with partners like phone manufacturers or with auto manufacturers or with app developers um and we can talk more about some of the partners we're talking to uh to actually get our technology we're a technology provider so our platform is embedded into other people's solutions okay and how do you guys make money is it sas or something different so we are a licensing model and then down the road once we have volume we are also going to have the ability to monetize that so this is a search model this is very not very different this as you guys know voice is really a search problem and that's why you know this is a you know this is where google and amazon are really you know focusing on because the idea there is that every command effectively could be a separate uh monetizable unit so when you say licensing model i mean give me an example of a sample contract is it monthly annually multi-year and what are they paying for so typically it's multi-year and i think we mentioned that we can't get a lot into the revenues aspect of it because it's still a private company but i can talk about the the overall business model which is that when we talk to large partners for example the phone manufacturer or car manufacturer we're talking about a multi-year contract where we monetize upfront there's some some aspects of customization which we also charge for but really the goal is down the road we're going to be charging effectively for those transactions because those transactions transactions that's what i'm asking what are you pricing against when you say transaction is the number of times people on a motorola device use your tool to give a command in a given year and that's going to be in the billions probably or again what do you price against yeah so our uh respon our relationship with with a partner like motorola is a licensing model so it's a fixed licensing model and if they go beyond a certain number of commands that's when we start charging on a per command basis yeah sorry we don't know what commands mean that's why i'm asking what you're pricing against what does a command mean so if i say for example um find me a product on amazon right and we take you to the amazon app or we say you know find me a shirt and we take you to the walmart app that is a transaction for us it's like a transaction or a command a command is a transaction because in our world a transaction takes you all the way yeah this is why i'm asking these questions right you're in the business we are not in the business so i want to get very clear on these metrics right so you you basically sell to motorola and say here's a fixed fee model based off the number of commands you believe motorola phone users will put through motorola in the next year to four years correct correct okay and the pricing is basically on an annual basis okay and i mean are i'd like to get some general sense of how aggressive motors being in terms of how how much they think this will be used are they talking like hundreds of millions or is it in the billions of commands per year yeah so i can't get into the details of that because that's pretty proprietary as you can imagine but the idea is that this is like a search model that's why i bring it back to this which is people are going to be using this on a daily basis i'll give you a concrete example was it billions though or maybe ignore motorola this space in general billions or million we're still in the high hundreds of millions range so this takes time right it's not going to happen overnight so this is this is something that's going to build up but think of it as eventually in the billions of billions again i'm trying to ask what so for me i don't currently do this on my phone so if i was on motorola i would be a big zero right now they have millions of users what i'm trying to understand is today right the volume the pure the volume whether it's through you guys or not through your competitors the volume of voice commands like this through these kinds of deals is it in the scale of billions yet at this point or is it still you know nascent in the hundreds of millions it's already in the billions but our share of that is smaller as you can imagine right yeah alexa we're talking about google alexa siri this is the domain that we are in but we are powering partners white cable solutions if you will right uh so so a partner would go in with their own brand and use our technology in their products and so but the domain is really in the in the billions already yeah so i mean how are you gonna beat google like the ones you just mentioned shouldn't they do this so they are doing it but let me tell you why we are still useful so more and more partners are realizing that they need their own brand voice because they don't want to be necessarily behind an alexa or behind a google and there are companies that actually try to serve that need and that's where we play which is providing our technology as a platform to these guys and many of them want to build their own products their own apps they're starting to turn on voice in their own apps for example bank of america you might have heard has launched their own voice assistant this is becoming pretty commonplace yeah but the newer genre on earth is going to install an app specifically for their bank voice assistant i mean that's why google and alexa are the major players because this is not actually a tech problem it's a distribution problem you're absolutely right and in fact the distribution is in the mobile app so let me kind of make the point when we talk to app developers they realize that their uh the actual access through say an alexa is actually minuscule and that's because people are not necessarily it's not convenient it's not ubiquitous whereas when i'm on the road for example why would i not be able to talk you know use um i use the uber app or the lyft app to actually call a cab right so more and more people are realizing that the usage is still in the mobile on the mobile side of the house and it is very valuable and is getting more and more commonplace to actually be able to talk to those brands directly so that's happening it's still very early in the process but in terms of our platform it's already playing in other sort of areas for example in cars we're talking to partners in the auto space where you know obviously voice is very important for safety and privacy as well and then we are also talking to media players where for example you're watching tv but you're not able to talk to your you know make any uh actions in your on your phone so people are now using these devices concurrently and we are trying to make it easy and seamless so those are some of the interesting areas where we are playing so i guess let's use your uber example right uber is never going to get in the phone business they're never going to have a phone okay google amazon tried right apple has their own phone with siri right they will all have voice basically right when the thing ships right in it so isn't it going isn't the winner in the talk to your uber app space going to be google or alexa right putting us dr or siri directly on the phone hey siri order an uber that's going to actually drive the command more than uber trying to say hey all uber writers like download our uber voice app right now so you can talk to uber and order order drivers my point is isn't the reason that google alexa needs are so big is because of distribution so so the distribution is an absolute very important point so the distribution right now when i'm saying they're not going to manufacture phones but their apps are already in the hands of users so users are already using the app now the question is why can't you talk to your app why do you have to tap through your tag your way through the app right so this is already happening and that's why i gave the bank of america example which is you're in the bank of america app you're thinking banking you are currently using the app through taps but now what you can do is use it through voice yeah but what about node that's my point though raja there's two taps to open the app if i could just pick up my phone and talk to siri there's no taps and it said and if siri directly via api connects to the banking thing the banking commands then you do it with no tap that's my point there's less friction to use the native thing versus downloading the voice specific use case for whatever app is that you want to talk to so so the point there is brand people don't want to necessarily lose their brand so that's the other thing which is branding and then the other use case that i was talking about is in the car people like mercedes doesn't want to be behind an alexa they in fact they launched their own voice application right there are companies that are doing this because they care about their brand and they don't want to be disintermediated this is another another point which is if i say get me a ride am i going to get an uber or am i going to get a lift and does uber have any control if it's you know google or if it's alexa they're going to make a decision so there are all these different dynamics at play here and the market is still very very early and it's evolving the point i'm making is we are providing our platform as a technology provider to these guys and there are different use cases as i said apps is one use case cars is another use case where these brands big large brands want control over their own users and their own user experience and very important their own data that's another aspect which is they want to be able to monetize that data down the road and today they lose control over their data and their users if they just hand it off uh to a google or an alexa or siri so this is a market that's still evolving and we are seeing traction because people want to build their own experiences and control their own user experiences as well as monetization well yeah but none of that considers the consumer right of course brands want to control the brand but if the consumer has to do a bunch of extra taps or a bunch of extra things so there's more friction they're never going to win they can spend all the money they want to spend with you building a custom app but if consumers don't use it it doesn't matter yeah but the point i'm making is that we will make it much easier for the for the for these brands to make it easier for their consumers because you'll notice that a lot of the stuff does not actually work within an alexa or a google unless the developer actually has to do a lot of the work one of the other important aspects which i should have mentioned earlier is that we can onboard these actions and we have a whole bunch of these actions without talking to the developers that's part of our technology so i can for example you can now do things in facebook whatsapp wechat paypal that you cannot do in alexa that you cannot do in google assistant even today got it all right talk to me about history here when did you guys launch the company so the company is a little bit more than two years old and uh we launched uh with uh funding from atlantic bridge which is our uh rvc they're very supportive of what we're doing and we very quickly actually acquired a company in belfast ireland uh that does a lot of our machine learning and ai for us so we have a very uh uh very power very very experienced team both uh what's the total team size today total team size is about 30 people and how much total did you say you had raised we raised uh five plus million with um in the in series a we are looking to see or to raise a series b this year okay and what's the right amount to raise in a series b you think what's your target uh i think we are targeting something in the range of about total of about 15 or so the reason being that this is obviously as you can imagine a very difficult space it's a very hard problem to solve and although we've cracked a bunch of these problems we are in the space where we need to have enough bandwidth to be able to to do these hard problems so we are already ahead of in some ways on some of the technologies uh that for example amazon is trying to solve right now but as you can imagine they have huge teams and huge amount of resources so we have to be very selective and focus on the problems that we think we can do better yeah and i mean are you it sounds like you're still vibrating kind of the experimental stage with space with a few key licensing partners i mean when do you plan to aggressively turn on revenue so we're already uh you know we already have revenue with the partners that we are we're talking to and we also have a bunch of these different pilots as you said but is it true occurring though or is there professional services like testing you know building a custom map with you know uber to see how it works no so so uh some of our deals don't have anything to do with apps i want to be very clear about that because i think we spent a lot of time talking just about apps but we're also basically plugging into other uh entry points is what i'm saying we call them voice channels well sure motorola so motorola is their own voice assistant that's a special case right so phone oems would basically use our technology to power their own voice assistant as you you may be familiar that samsung for example has its own voice assistant called bixby right and google obviously has google assistant and uh apple has siri but many of the uh phone oems are looking at their own branding and their own yeah i totally get i totally understand the product my only question is like when do you get to the point where you really are scaling your licensing model versus doing kind of early testing where they're paying you like a consulting fee to like do viability experiments yeah so our first deal was already a licensing model okay but already talking to a bunch of partners where right now we're in the second phase which is like validation as you can imagine it's very strategic right so they take their own time and they're you're very deliberate about their decisions but once some of those become deals we're really talking about scale already because these are large partners got it okay so you've got one customer where again it's already a licensing model then you have a bunch of pilots you're running on all these different kind of experimental channels that have the opportunity to be much bigger deals in the near future absolutely okay makes good sense and now how are you supporting you know 30 people right i mean if you're basing if you have one customer i have no idea what that customer is paying but i mean i assume you're burning a crap ton of money but you haven't really raised that much so so how are you funding 30 people yeah so we are obviously very conservative in terms of our spend and also because uh you know we have a team in belfast the costs are much lower than for example in silicon valley uh so so we are basically being scrappy and we are trying to make sure that we are being uh very uh responsible about how we spend but really about you know getting we also have you know for example payments around some of the pilots and things like that so it's not like so we have revenues as well so but we are as you said trying to get to this to the point where we have a uh scale around multiple partners and i think that's we are at the junction at the juncture where that's going to happen yeah i mean i just it's always fascinating to me when a company like yours you know to go out and raise a 15 series b if you only want to sell 10 20 of the company right you're basically trying to get at something like a 50 60 70 million dollar pre-money evaluation right with essentially one customer and some other experiments it's always fascinating to me the story that you decide to tell to try and get that evaluation and minimize delusion yeah it's definitely a challenge especially because then the big names are in the picture right no doubt about that but it's also very uh important to note that this is super strategic which is what people realize right away which is it's a hard problem to solve you guys have solved some of these very very hard problems that have not yet been solved for example by alexa so you're serving a need that these platforms are not serving yet at scale for example the apps we have thousands of actions available to our to our motorola customers most of which are not available on some of these other platforms so they've seen the value pro uh proposition of the product so definitely it's strategic it's very important for us to be able to convince them that it's strategic and by the way as you can imagine you know these are areas where there's a lot of investment going in as well but of course as you said it's a a place uh you know it's very uh challenging as well for us to actually emerge from this yeah i mean do you feel like with the one license deal you have today plus if some of these other pilots land and it's true licensing deals do you feel like you can you know the next 12 to 18 months you know get up to something like you know a 5 million run rate to justify a healthy 15 million series b absolutely do you think it's possible it's not just possible uh we have if he execute it's likely okay very good all right that's right it's really about execution and also the fact that the market is maturing uh it is as i said deliberate so it takes time so because these are big partners it takes time it is strategic they have to figure out what they want to do with their own voice strategy because they've actually been burned a little bit by some of the early efforts around alexa where they're not getting the traction and the roi but they really understand that voices here voice is definitely here and it's it's really about how our brand is going to engage with their own brand voice yeah very good let's wrap up with the famous five number one what's your favorite business book um actually i haven't had much time to read a lot but i've been following for example the biography of pep guardiola who is actually one of my favorite coaches he's actually a coach uh in uh sort of soccer i don't know if you're familiar with it what's the book uh it's pep confidential i've been reading it and i try to you know obviously it's about team it's really about performance and team and he's one of the most eminent coaches in soccer with barcelona and bayern munich and now he's manchester city's coach so i try to bring some of his philosophies and team performance into into work great number two is there a ceo you're following or studying i'm not studying anybody but i'm super impressed with what elon musk is able to do i mean number three what's your favorite online tool for building your company um at this point i follow i guess tech news uh because i have to keep abreast with what what i have so i wouldn't say there's a specific tool but i do read a lot of the content online all right number four how many hours of sleep to get every night uh i get about seven hours and how old are you i am pretty old yeah so i'm 50 what is it 53 or 54 or so 54. okay and what's your situation married single kiddos i have two boys the older one works for google the younger one is at usc and is currently interning at apple very cool okay um and the last question here take me back to your 20 year old self what do you wish he knew um i wish i knew that um it is possible to kind of run your own business um i was obviously a student coming in for grad school and you know going through the normal path but had i been in california i would have probably been in the entrepreneurial kind of line much earlier i was in new york for a while guys aikido propelling things like the motorola kind of voice actions on motorola devices and other devices whether it's an app or other entry points because voice is here they've got essentially one customer paying on a licensed model peer license model today they've got a lot of pilots though cranking people understand this is important hoping to hit call it a 5 million runner in the next 16 to 18 months hoping to maybe go out and do a 15 million series b sometime soon as well they raised 5.2 million today a team of 30 people as they look to continue to scale raja thank you for taking us to the top hey thanks thanks a lot and i hope i got the point across that this is across a platform and multiple different entry points