How Alfinder Raised $300K and Signed $150K in Beta Pilots Before Launch (Interview with CEO Eris Verne)

Introduction to Alfinder and the AI Marketing Platform

Nathan Latka

00:00Hey, folks. My guest today is Eris Verne. He's the CEO and founder of A-L-F-I-N-D-E-R, Alfinder, which lets companies get a deep understanding under over their ideal customers. It helps you understand exactly what your likes, hobbies, interests, and pain points mean. By using AI, they're able to figure out all these things out. So when you market your company, you're able to write your marketing copy, your case studies, everything more accurately. Eris,

00:22you ready to take us to the top?

Eris Verne

00:23>> Let's do it. Alright. It's not Allfinder.

Nathan Latka

00:26It's AI Finder. Right?

Eris Verne

00:28>> Well, it's Alfinder, actually. So it's That is very would be all.

Nathan Latka

00:32That is very confusing because it's you're using AI, but it's Alfinder. I was very confused how to pronounce it. Doesn't that create a branding is problem?

Eris Verne

00:39>> Also, yeah. It's pretty interesting. It's it's a good, you know, tweak on AI and Alfinder, already all Finder. That was the whole, you know, idea behind the name, but it does heavily indicate the AI aspect. Here's the deal. With Alfinder, it's a very unique project that I'm working on right now. And the best way to describe it is that, let's say right now, the normal bread and butter, you know, AI company marketing, the process that they

01:07>> go through is that they look at the market, they see when to post something, they look at the historic data. There's so much data out there, so many tests out there that you can see for that industry based off of that customer. Let's say, when is it best to, I don't know, post on Instagram, for example. And then they use that trend to reflect on their customers. There are plenty of softwares out there. How we look

01:33>> at it is somewhat completely, from an inverse perspective such that, let's say you have a well, you have a bookshelf behind you. That's pretty convenient as an example. So let's say I look at your, bookshelf and say, oh, these are the books that are there, so based off of those books, you probably are going to like this one. But that's going to be

Who Is the Customer and What Do They Pay

Eris Verne

01:59>> most likely, it's going to be wrong because you might actually

Nathan Latka

02:05Sorry. I wanna jump in. We're all over the place. I wanna set some context first and then we can talk more about the product. So who's buying this product first off? Who's the customer? Oh, marketing agencies. Okay. Marketing agencies specifically. And what are they paying on average per month to use the technology?

Eris Verne

02:19>> A couple of thousand.

Nathan Latka

02:20Okay. So you're

Eris Verne

02:21>> sort of mid- mid market moving towards the enterprise agency? Yes.

Nathan Latka

02:25Okay. And on the timeline, when did you launch the business? What year?

Company Timeline and Launch History

Eris Verne

02:31>> Last year.

Nathan Latka

02:32Oh, so brand new?

Eris Verne

02:33>> Oh, yeah.

Nathan Latka

02:34Okay. We've been working

Eris Verne

02:36>> on it for a couple of years. It takes a lot of time to, you know, get the AI engine up and running, but we launched last year on a beta note.

Bootstrapping vs. Raising Capital

Nathan Latka

02:44Okay. Got it. And are you bootstrapping or did you decide to raise capital?

Eris Verne

02:49>> Bootstrapping. We we raised a little, mostly on my own from previous exits, but we we are bootstrapping.

Nathan Latka

02:57How much of your own money or from angels did you end up putting in at the start?

Eris Verne

03:00>> I put

03:03>> about a 100,000, and I have about a 200 k outside investment from angels. Got it.

Nathan Latka

03:08So $300,000 total. Now, when you say you put in $100,000, we want to get in the entrepreneur's mindset here. I mean, is that a lot for you? Is that your whole savings? Do you have to make this work?

Eris Verne

03:16>> No, it's No, it's not. It's a pretty conservative amount.

Nathan Latka

03:20Okay. So why not go all in? Why not why not pull all your money in, build faster, grow faster, go quick?

Eris Verne

03:26>> Oh, that's a good question. It's money doesn't always get you doesn't help you get there faster, especially with such an AI. It it it's such a huge risk on such an AI because we don't have a product that we are trying to, let's say, automate it with AI. The whole thing is is an AI engine that we train it and then we find use cases for it. So

03:51>> the very initial idea of mine, coming from some AI backgrounds, was that can we do behavioral analysis on people, understand the end customer and say, this is the best way to get to them. Okay? Now, when we do succeed on the training of that AI with loads of data and so on and so forth, then we are able to build a product on top of it and then, you know, find out what's the best market, what's

04:20>> the best user for our product, which consequently is going to help them, you know, gain, let's say, more customers on their end.

Nathan Latka

04:29Oh, what's going on there, YouTube? Good to see you guys. Now imagine this. You love watching these interviews with SaaS founders, but imagine if we took all of the valuation data out from over 2,807 interviews I've done manually. Saves you a lot of time. Well, we've done this. We've built it into the beautiful interface inside of Founderpath. Check this out. I'll show you how you can access this in a second, but you log in, you connect

04:52your Stripe account, you see your valuation real time. You can see what it changed over the past eighty eight days and even set goals for valuation this year. Now the secret evaluation is there's many different ways to value a SaaS business. So the reason you're gonna see three or four different valuations inside of your Founderpath dashboard, this is all free by the way, is because depending on who's doing the buying of your SaaS company, you're gonna

05:16get a different valuation. A VC is gonna pay a different valuation, Private equity firm is different. If you're gonna do a minority sale, that's different. And if you sell the whole business, that's a different valuation. You can see all those when I hover over here, right? So the teal is what a VC would pay. Yellow is what private equity And red is if you sold the whole thing outright. Now what's cool about this is this is

05:38not built off random data. Again, you guys hear these interviews on YouTube. All these datas are built from real time valuation data points founder share with us on the show. So traction 1,200,000 seed round 3.7 raise. They sold 22% of their business. Go in here and filter by the event. Maybe you only wanna see companies that have sold the whole business. Well, here are a bunch that have been acquired the valuation and the multiple. Maybe you're

06:04going out right now and you're raising your seed round. We'll go in here and look at all this recent seed deals that went down, what they raised, what valuation they raised at and what percent that they sold. There's never been a larger dataset of SaaS valuations than what you can get now inside of Founderpath. And we're thrilled to bring it to you. All right. We're gonna go back to the YouTube video here in a second, but

06:26if you wanna check this tool out, if you wanna jump in and sign up, you can check it out for free to get your valuation at this link. This link, founderpath.com/products/valuations. Or if you go to founderpath.com and hover over products, click on get your valuation here, and go ahead and sign up to give it a whirl. Again, all that valuation data live right inside the platform. I hope to see you there. Alright. Let's jump back into

06:52the interview. Understood. Now do you have any customers today, are you guys still pre revenue?

Beta Users and Pre-Revenue Status

Eris Verne

06:57>> We are brand new. We've had a couple of crazy beta testers, huge companies, international companies. Locally, have, I mean, there are upwards of 200 people that beta tested it and they have an account, you know, marketing strategists all the way to very small marketing agencies. Nothing crazy, I wanna say. I guess that comes down to my standards, but we do have solid traction.

Nathan Latka

07:23Okay, but just back to my question. So do you have paying customers today or are you pre revenue?

Eris Verne

07:28>> I'll be pre revenue.

Nathan Latka

07:29Okay. Pre revenue.

Eris Verne

07:30>> We're also beta testers.

Nathan Latka

07:31So let's walk through it sounds like you have a healthy beta sort of pipeline. So how did you get 200 people signed up for your beta over the past twelve months?

How Cold Outreach on LinkedIn Drove 200 Beta Sign-Ups

Eris Verne

07:39>> Outreach, cold Outreach. It's a very interesting product to say the least. Okay? Going inside a strategist mindset or a very small, you know, marketing agency's founder, owner, telling them you don't have to come up, let's say per se, for a marketing strategy and this software generates this strategy for you and you can only focus after the strategy, on executing, implementing that strategy, monitoring all the data on the ad platforms, that's a huge relief for them

Nathan Latka

08:13because that's the My reason have my I totally get the product. My question was how you got 200 people to pay attention. Right? So when you say

Eris Verne

08:20>> cold outreach an amazing product.

Nathan Latka

08:22It's very Okay. It doesn't matter. You can have an amazing product and no one knows about you. So it doesn't matter. Right? So my

Eris Verne

08:27>> question Well, easy to convince people.

Nathan Latka

08:28Question my question is specifically, how did you get these people to pay attention? Right?

Eris Verne

08:32>> So when you Pipeline wise? Well, LinkedIn, mainly.

Nathan Latka

08:37Okay. So what specifically did you do on LinkedIn? What was the who did you target? Me finish my question. Who were you targeting? What was the title of the person? And what was typically the copy of the first message you sent?

Eris Verne

08:51>> Oh, these are all, again, are all marketing strategists and small marketing agency owners.

Nathan Latka

08:57Okay. So you're targeting literally marketing strategists as title on LinkedIn?

Eris Verne

09:02>> Yes.

Nathan Latka

09:02Okay. Can you target small agency owner on LinkedIn and get a list? Don't think anyone calls himself a small agency owner, do they?

Eris Verne

09:10>> No. But you can do marketing agencies, branding agencies, and then, you know, filter based on the size and the revenue and so on and forth.

Nathan Latka

09:18That's what I'm looking for. You search for branding agencies. You filter by what size usually?

Eris Verne

09:24>> Normally from 700 k to 5,000,000 revenue.

Nathan Latka

09:28LinkedIn gives you revenue data to filter by?

Eris Verne

09:30>> You can.

Nathan Latka

09:31Yes. Okay. Are you paying for that in Sales Navigator? Yes. I see. Okay. Got it. That makes sense. Okay. So and then what does the message say? What's the first message say?

Eris Verne

09:41>> Well, it's a very short introduction to the product and having them sign up for a demo. And then I'll show a demo to them, you know, different use cases, and they will take it from there.

Nathan Latka

09:54Yeah. But I get I get those emails all the time in my LinkedIn. I ignore all of them. So what did you put in your copy that got 200 people to sign up? Okay.

Eris Verne

10:00>> It's it mostly comes down to examples. That's at least what we've tried and then it's it's it's proved perfectly, such that we say, okay, this is the process that you go through and we know that, so they know that. It's very convincing to them. It's not like an advertisement. It's like, this is a process that you go through based off of who you are within that agency, let's say, and this is going to help you with

10:23>> that specific aspect of it.

Nathan Latka

10:27Okay. Got it. Can you get instead of using like that specific aspect and we know what you go through, can you actually, like, read to me sort of what that copy sounds like?

Eris Verne

10:36>> Right. So here's here's what goes through an agency when they, let's say, onboard a new customer. They go through the data, they are asked quite a bit of questions about their industry

Nathan Latka

10:46Eris, sorry. Just to be clear, is this the email you this is the link you messaged you're sending me? You're reading me that message.

Eris Verne

10:51>> Just scroll up the message. Oh, you want the exact message? So this is how it goes. Let's say, hey, x person, this is this is who I am. This is the company, blah blah blah. As part of your process, you do a lot of research on your own and you use softwares that use static data, maybe historic data, to derive marketing strategies rather gaining knowledge to create this strategy on your own, our software does all of

11:19>> that for you with a click of a button.

Nathan Latka

11:24Okay. What's the call to action?

Eris Verne

11:26>> Well, they book a demo, and then I show them a demo.

Nathan Latka

11:29So just click here to book a demo.

Eris Verne

11:31>> Exactly.

Nathan Latka

11:32People respond to that.

Eris Verne

11:33>> Yes.

11:34>> They do.

Why No One Is Paying Yet: The Beta Strategy Explained

Nathan Latka

11:36Interesting. Okay. So that's how you get 200 beta users signed up. Why is no one paying yet?

Eris Verne

11:41>> Well, they're all beta testers. We are still collecting a lot of data. One thing to point out about the marketing industry is that specifically anything relating to the whole process of onboarding a customer to deploying a strategy on all the ad platforms, not that you can't tell them, Hey, try it for thirty days for free and then see what happens. Because they can't rely on the, specifically for our case, for Alfinder, they can use a strategy

12:11>> deployed and then see if it failed or if it succeeded in thirty days. Most strategies take maybe up to three months to six months to understand if that strategy is actually working. So we are monitoring all these beta testers, we're encouraging them to keep using the strategy generated by our platform, implementing them, And then at some point where we have solid feedback from those users, then we have a very bright green light to

Nathan Latka

12:42When were your our first beta testers signed up?

Eris Verne

12:46>> Oh, about a year and a half ago.

Nathan Latka

12:49Okay. So you just said they need about six months to see traction. So if there's people that have been with you for a year and a half, why are none of them converted to paid yet?

Eris Verne

12:55>> Well, we only The the more we move forward, we have more data. We can't just collect data from 10, you know, beta testers. We need a lot of data just to, you know, let's say, have a good solid proof for the platform, let alone the investing aspect of it, you know.

Nathan Latka

13:13I mean, if you spend all this time getting more and more data, you finally have a lot of data and then no one wants to pay, you just wasted, what, four years of your life?

Eris Verne

13:20>> That's the beauty of an entrepreneur life.

Nathan Latka

13:23Yeah. But isn't a smart entrepreneur gonna try and hedge that by trying to sell the idea ahead of time or get to revenue as quickly as possible?

Eris Verne

13:29>> Well, here's the thing. We can get to revenue. This is well, comes down to my mindset as a founder. We can get to revenue as soon as possible. We can charge these beta testers, like, cheap, let's say, couple of $100, and then get to quote unquote revenue. But what's the point of that? We're building something far bigger because the moment we integrate into the, any agency's, you know, environment, Alfinder is going to be the only

13:55>> software that they're going to use.

Nathan Latka

13:57They're gonna cancel all their other software.

Eris Verne

13:59>> They don't need anything else. Because right now they use softwares to get data, to look at industry, you know, research and all that. But with Alfinder, you don't have to integrate any type of data that you already have. If we already have all the data we need, we just ask questions about your customer, your client, and then the goal is to make you independent of, you know, even the businesses of any marketing agency. So you do

14:24>> that, generate the strategies, you get a couple of options, you select one, and then you directly launch from Alfinder. You select, let's say, Google platform, and then you launch.

Nathan Latka

14:35So your success is directly correlated to your ability to convince marketing agencies to cancel all their other software?

Eris Verne

14:41>> To a degree, yes.

Nathan Latka

14:44You've created a lot of friction for yourself. I'm trying to figure out why.

Eris Verne

14:49>> Oh, well, go big or go home,

Nathan Latka

14:51I guess. Maybe people don't want to pay for it. Right? And so your answer is we haven't tried to get people to pay for it.

Enterprise Paid Pilots and $150K Collected

Eris Verne

14:57>> Well, we have. We've had the the two big companies that I told you about, we've had contracts. Those contracts total about $150,000 in nine months. So we tested with them, they're huge companies, so they have, let's say, as part of their R and D budget, we've had four months of free for them And then if they decided to move forward, we entered into a paid contract. So it's foolproof, but that's a bigger, you Have

Nathan Latka

15:27you collected that cash, cash 100% is in your bank account?

Eris Verne

15:31>> That is right. Right. So we had beta paid pilots, if you wish, and those are big companies.

15:43>> The matter, we're launching in like two months or so as part of, we're raising another, you know, round right before we launch and then

Fundraising Plans and Valuation Thinking

Nathan Latka

15:50You've only raised 300 to date though or have you raised other capital?

Eris Verne

15:54>> Yeah. We're trying to raise another couple of million seed stage before launch, and then we're planning on launching mid March ish.

Nathan Latka

16:03Eris, why raise so much capital? I mean, it's your seed and your pre seed and your seed are the most dilutive ever. And you've told me in your bio, you've had multiple exits in the quote seven and eight figures. So why would you sell big chunks of the company free revenue?

Eris Verne

16:17>> That's a great question. Well, going back to like my exit, it's not a matter of me pumping so much money into it. The connections within the industry comes from the money that we gain. You know, the 2,000,000, the couple of million is worth almost nothing. I don't care about the zeros in front of the, you know, the cash in the bank account, rather the connections that comes with that capital. That's the biggest gain, okay? That's why

16:45>> I'm very selective on who I raise from.

Nathan Latka

16:48You've There got to are many ways to get people close to your company without letting them buy a massive chunk of the business that, you know, otherwise everyone would always have to sell a big chunk of their business to get anyone to care about them, which is not true.

Eris Verne

16:58>> Well, when you say big chunk, that's like up to the team, right? We're not really selling a big chunk.

Nathan Latka

17:04Now to How much do

17:06you think How much do you think if you raise $2,000,000 pre revenue, how much do think you're gonna sell the business?

Eris Verne

17:12>> High single digits.

Nathan Latka

17:15Okay. So you think you can convince people to give you Let's say you sell 10%. You think you can convince people to give you a $20,000,000 pre money valuation?

Eris Verne

17:21>> Yes. Based on Based on revenue. Yes.

17:26>> Based on the IP that we have, the the like, AI Where's the IP coming from?

Nathan Latka

17:30If you had 30 engineers that have been coding for two years, I'd get it. But you have two people listed as employees on LinkedIn. So what's the IP?

Team Size and Offshore Development

Eris Verne

17:36>> So that's the that's going back to the first part of your your question. So the main need for the capital is to move our development team engineers from offshore to onshore.

Nathan Latka

17:47How many people are full time today?

Eris Verne

17:49>> Offshore, about seven.

Nathan Latka

17:51Are they full time?

Eris Verne

17:53>> Yes. Well, they're contract based, but they are working for us. So Okay. But so but

Nathan Latka

17:58it's you plus seven, so eight total?

Eris Verne

18:01>> Eight total. Yeah.

Nathan Latka

18:02Okay. Got it. What what which country you said to work with, by the way? It Eastern Europe or Argentina or somewhere else?

Eris Verne

18:07>> No. India, mainly. India and Pakistan. Pakistan on the AI side, mainly. India on the, you know, the website, let's say.

Planned Launch Timeline and Pricing

Nathan Latka

18:15Yep. Yep. Yep. That makes sense. Interesting. Well, look, I'm certainly rooting for you. I mean, is there a plan to ask these big two enterprise accounts to start paying a monthly fee outside of their big pilot since they paid a $150?

Eris Verne

18:26>> But that starts so we will notify them and then the paid process starts the moment we launch. So the moment we officially launch Which is when? Kind of solid

18:37>> before April.

Nathan Latka

18:39Okay. Okay. And you're gonna try you're trying you're gonna try and get them to pay something like 3 to $5 thousand a month when you launch in April?

Eris Verne

18:46>> Yes. Well, they've been testing this offer, I wanna say, like maybe 30% of them for at least a couple of months, you know. Most of them signed up, you know, it's exponential. So the person who signed up a year and a half ago or that chunk of people are not so many out of the 200 that we have. So most of them signed up, like, recently. And out of that, we will convince them, obviously, some will

19:09>> not continue, but that's not going to be a huge percentage.

Famous Five: Books, Tools, and Personal Background

Nathan Latka

19:13Alright. Well, we'll see what happens. We're rooting for you. In the meantime, let's wrap up with the famous five. Number one, what's your favorite business book?

Eris Verne

19:20>> Business book.

19:29>> It's not really a business book, but the Atomic Habits, I would say, was the best one.

19:36>> Atomic Habits, James Clear.

Nathan Latka

19:37Number two, is there a CEO you're following or studying?

Eris Verne

19:40>> Steve Jobs, all the time.

Nathan Latka

19:42Number three, what's your favorite online tool for building Alfinder?

Eris Verne

19:48>> Typeform.

Nathan Latka

19:50Number four, how many hours of sleep do get every night?

Eris Verne

19:54>> Oh, I don't even count. I don't know. Sometimes four, sometimes, I don't know, six, seven.

Nathan Latka

20:00Alright. And what's your situation? Married, single, kids? Single. Okay. And how old are you? 22. 22. Last question. Something you wish you wish you knew two years ago when you were 20.

Eris Verne

20:12>> Some connections are way too overrated.

Nathan Latka

20:16Says the guy who says he wants to raise $2,000,000 for more connections. We'll see what happens. In the meantime though, guys, alfinder.com launched. You started working on it, call it a year and a half, two years ago, has two big beta customers that have paid $150,000 already total on pilots. Hoping to be able to charge them a monthly fee starting in April of $2,000 to $5,000 a month. We'll see what happens. But today, pre revenue in terms

20:35of SaaS, $300,000 raised, closing a $2,000,000 ish round right now. We'll see what happens again to help make marketing agencies way more efficient. Eris, thanks for taking us to the top.

Eris Verne

20:44>> Absolutely. Thanks for your time.

Nathan Latka

20:48One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. 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 1PM

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