Air Traffic Control Revenue (2024)

hello everyone my guest today is nick zeckitz he's a two-time founder first exited in 2018 now dedicated to product led growth and in love with the transition of b2b marketing to b2c experiences he's a bostonian by way of georgia and many other places now building air traffic control dot io nick you ready to take us to the top sure am all right so what is air traffic control yeah really simply it uh it makes true human specific personalization possible in any other piece of software okay and so what does that mean exactly yeah by and large when you think about marketing and what marketing means and why it's hard a lot of people are leaning into this idea of personalization when they say personalization what they really mean is harder and harder and more demanding versions of segmentation that uh that just doesn't scale right uh and and frankly marketing has hit the breaking point where uh account based marketing segmentation based marketing um has broken the human barrier and and humans can't make it work any better and yet the demand to personalize engagement remains so what we do is we use machine learning to deeply understand the behavior of humans not cliques and moments spent on web pages but more importantly the subject matter that people have engaged with and then what we're able to do is dynamically and automatically without anybody at a customer having to set any new rules but still using the software that they're used to simply uses a new set of things like merge tags or content blocks that will serve up content of any kind to each and every individual human across email web chat anything else in real time that has been chosen for them the result being better engagement rates higher conversion rates etc and what are customers paying you on average to use this technology you've built yeah so our model is a consumption based model so every time somebody sees something that's been personalized to them it's two and a half cents so for a very small business that maybe has a couple hundred pieces of content and not many uh monthly visitors or or email uh recipients it might be you know 50 to 100 to 200 bucks a month for a large media business it could be a hundred thousand dollars a month that's a massive range what's the sweet spot what's the average yeah for us right in there uh right around anywhere between five and 10k per month okay let's just go with 5k per month i want to paint the picture of this hypothetical customer someone that's paying you 5k per month about how many content pieces that our customers are they delivering per month yeah so it's a really great question it all depends upon their volume and diversity of their market and the volume diversity of their own content but what you're really kind of thinking about is tens of thousands of personalized experiences happening across the course of the month we do try to inform their content strategy by saying here's the stuff that's working the subject matter that's working and not working for you relative to your efforts to your community the people who are engaging with that or not um but you know if an organization has a couple hundred pieces of say blog posts or white papers or product descriptions um you know the the permutations could be incredibly voluminous but you're talking about anywhere between 50 to 100 000 you know personalized moments a month and nick when did you found the company what year so we went into r d a couple years ago um we were legal uh about nine months ago we started going to market four months ago and uh three months and 30 days ago we were revenue positive um and and we've just been building pipelines since then how many customers do you have today right now we are uh proof concepted or more at eight so not a whole lot well that's okay i mean this is sort of you know you're learning right you got to get people on boarded um that being said though i am a bit surprised with the range you just gave me on on acvs so early usually people try and focus on a specific use case for their first 10 20 100 customers you have people paying you a lot a month and some paying 100 bucks a month oh no that's the range of what's possible we don't have anybody paying us 100 bucks a month we have no time for that everything right now is enterprise b2b marketing organizations with at least 500 pieces of content more than 50 000 people that they're endeavoring to touch a month through web and email we're predominantly looking to activate web content over email right so that outbound activity being personalized to every individual that they're reaching out to so not dealing with as much real-time effort which also keeps our technology costs lower so just to be clear the eight the eight customers paying you today they're they're all north of five thousand dollars a month in revenue yeah for sure that's right spent got it so you're north then i mean can i multiply there eight times five thousand you're 40 grand a month in revenue yeah you could get projected roughly in that that range sure well i don't want projected though is that where you're at currently is that we did last month i think i'll hold back on the uh on the total revenue per month at the moment i'm not sure that we're ready to to go live with that okay i'm asked i'm just multiplying the numbers you've already given me right you said five thousand dollars was the act the average rpo and you said eight customers why can't i just multiply those sure if you would like to multiply them that's fine the range is pretty diverse but yes that is okay okay is it accurate roughly sure okay so the reason i bring that out is because that's impressive if you've gone from nothing to 40 000 a month in revenue in four months i want to learn about that yeah well so i think it's really important to know where it is that we came from last business that we built and we exited in 2018 was a marketing automation platform built on the concept of personalization what that was it was called quadrangle um it was built specifically for higher education the mistake that we made was building all the features on top of a personalization engine so as we exited that business we did reasonably well the issue was and our recognition was that the intelligence we had underlying our feature set was really the product um and we had made the mistake of building the feature set on top and uh as we started to roll out of that we had a really good sense a lot of martech companies were trying to figure out how to do exactly this right how do we deliver personalization and they were doing it because their customers were asking them to deliver on personalization and what was happening is the market was basically building uh you know more and more and more tools for tagging your content and for creating more segments and for creating dynamic logic to line content and humans up but really content and segments was the best that was happening out there and and so the demand is incredibly well understood and lots of big companies have been marketing the value of personalization and marketing leadership is convinced that it's real so we weren't pitching a market that didn't know that this was important what they didn't know is that personalization and segmentation aren't the same thing they've been sold as the same thing they are not and so as we've walked in and said hey we know your pain point is connecting all these dots back in with a ton of logic but what you really want to do is actually have a machine take over and do the personalization they all say oh my god yes you're right right and all we have to do to get in is just say all right we'll just connect to the tools you already have that's not really going to cost you anything and then as you scale up right you'll scale up spend because you'll see the success against the use i guess let me ask a different question with with the product features that you currently have and the initial set of beta users you're working with do you feel like you can break a million dollars in ar by the end of this year does it feel doable oh 100 yeah i have absolutely no doubt that we'll be over a million in year one okay amazing so 22 okay so you get going here 2020 flesh out the team for me here who are you working with how many people yeah so they're at the moment there are three of us um we suspect you know probably by the end of q2 it'll probably be more like five or six we just hired somebody yesterday another developer how many developers two two right two with a higher yesterday yeah so pretty lean um but the good news is the api itself is remarkably simple right and the integrations you know most everything now is oauth uh and that really that standard has made it a lot easier to kind of be able to connect into the stuff that people are using so it really simplifies you know our go to market have you have you bootstrapped the business or did you raise capital 100 percent bootstrapped 100 okay and did you learn i mean i think you raised five or 600 at the last company you learn anything from that oh we raised more than that um how much did you how much did you raise a quadrangle uh we were at a couple of million by the time all said and done um in a handful of weird rounds you know that the reality is um you can get so much further along um if you're really smart about product-led growth and really smart about unique nuanced use cases right it's like could we do a million things sure you know do we have the ability to scale up and down shore but do we know that b2b marketers who believe that inbound matters um you know are feeling extreme pain absolutely so we're really focused on a particular subset of the market um and and doing that means that we can get to revenue pretty quickly and frankly not being in higher ed anymore higher ed is really averse to kind of paying for you to get to product um and the corporate space says look i could see the demo i know that it'll work for us but i mean i think the challenge you're going to run into is the same thing you heard in the snowflake ipo when frank slootman was walking through their usage based billing which is you have instances where people scale up their usage so much the bill they get is shocking you could see a scenario where someone installs your thing and all of a sudden their bill is 30 grand a month and they're going oh my gosh this is valuable but it's not 30 grand it's not worth 30 grand a month i can't pay this consumption model anymore yeah so you know i think there's a couple of things that are at play there and i think it's a really fair i think it's a really fair point um one you know i would i would actually argue that that puts a mandate on vendors like air traffic control to be exceedingly clear on what our value is right and as a result of being connected to all of the customer systems like crm like all their conversion pages forms email conversion rates all that type of stuff what ends up happening is we can actually talk about uh whether or not people who are being exposed to personalized content are more or less likely to turn into customers right and understanding acv and opportunity amounts and things like that we can quantify the value of personalization because we are part of their commercial complex right i think one of the problems that happens with consumption models and in other businesses is that yeah hey this is a shortcut to say build a product right um you know and twilio has a really hard time saying hey we build stuff on top of all this this is how much money we've made you ah maybe maybe not we we aren't we are not unsure because in order for us to work we have to be tapped into all that data because that's what tells us who somebody is and what they care about and that comes along with that revenue productivity and we can see basically by looking at our performance in a customer's prior performance without personalization what the impact is so you know yeah right at a certain point i start to spend over my skis a little bit and i'm sure at some point some people are going to ask us for you know sort of flat rate or an annual spend and it'll look more like sas or whatever it may be but i think the mandate when it comes to consumption model businesses and this hasn't been happening and you saw it in snowflake it's a really astute observation is that it's sometimes really tough to tie back to every time that happens whether i'm making money but the stripes of the world haven't had that problem well that's because that is that is making that that is directly making money it's obviously attributable sure sure and so it's on us to get as close to attributable as humanly possible right and yeah but you're not going to be paying you're not going to be you're not going to build a payment processor no of course not of course not but i can say that when we do what we do that that revenues are impacted in positive ways now it might turn out that a year down the road we might find there are unique instances where depending upon the customer type or whatever it is two and a half cents isn't actually what we're worth we had another customer say well every time that i actually get a form filled out or i do get a conversion i actually would like to pay you 30 40 times more than that oh yeah because it's time to convert you want something further down yeah totally right exactly right so you know and so that might be what happens we might get a buck every time a form gets filled out who knows yeah right very good you know what we're we're out of time nick we need to wrap up here with the famous five number one favorite business book oh god uh anything by nire y'all really number two is there a ceo you're following or studying hmm that's a wonderful question uh no i can't i can't say that there's anybody that i'm watching right now i do like this this guy is running a place called modern campus named brian kitty he's he's super sharp and bringing some big businesses together i like what he's doing number three what's your favorite online tool for building air traffic control besides your own oh boy um i'm deeply in love right now with uh with built with it helps us a ton with targeting it's super inexpensive and their data is really unique number four how many hours of sleep to get every night uh i try to get seven or eight all right this idea this uh you know work porn thing is um it's not sustainable and what's your situation married single kids kids married house burbs the whole thing how many kids three three and how are you i'm 41 as of monday 41. hey happy happy uh happy late birthday uh what's the meaning what's something you wish you knew when you were 20. oh god uh it's a long list but um ask more questions have less opinions guys he sold his first company learned a lot raised a bunch of vc now boots dropping air traffic control dot io helping brands customize content to deliver it up to inbound leads to ideally increase the likelihood that they end up converting again he's bootstrapped a team of three or four right now got his first aid customer signed up paying anywhere between a grand and 10 grand a month as he looks to scale and really figure out what that pricing is going to look like nick thanks for taking us to the top thank you very much one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the 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