How Alyce CEO Greg Segall grew Alyce to $5.7M revenue and 460 customers in 2023.

hello everyone my guest today is greg seagal he's the founder and ceo of alice an ai powered corporate gifting and incentive platform founded in december 2015 alice tells a corporate gifter exactly what to send and the most impactful times to send before alice he was founder and ceo of onepika one of the premier global e-commerce agencies he also invested scaled and aided the acquisitions of several smaller retailers one pico was successfully acquired in december 2012 by a holding company in san fran he received his ba in graphic design from boston university in 2001 with a strong focus on computer science greg are you ready to take us to the top let's rock all right last time we spoke if i remember correctly you were very much in this kind of stage of figuring out if you know the revenue stream that alice was kind of going to grow is going to be you know relationships with gift vendors that you'd recommend to these corporate buyers or an actual technology pure place sas kind of company where are you today yeah so it's actually evolved a lot uh since we talked about a year ago uh so the whole company obviously still makes a lot of money off of the the gifts itself and the transactions but a majority of the money is coming in from sas so we've actually built this out because the the product and the platform that we've built we've just learned has a lot more value than just the actual sending the gifts itself you know it's evolved since uh just being hey this is a gifting platform i can go into more like on the use cases if you want to hear more about that because that's been one of the big things that we've uh we've done also we've raised a big round of funding um which you probably saw as well yeah so give us the update news on the funding so how much total have you raised now to date yep so we've raised 5.4 million um from three of the top investors in boston uh one out in palo alto and then one up in toronto uh and uh that's right for where we are with funding that's 5.4 all together or just the last round okay so what is it all together all together about 5.9 5.9 okay very good so this was your really your first equity round then very good okay so walk me through and give me a sense to you mentioned earlier that you you know you have a large volume and a large amount of revenues coming from just the gifting side of things quickly tell me that revenue model and then tell me why the transition into sas and how you've scaled yeah so the well the revenue model itself again is that we have deals with all these merchants across the globe um and you know that's something we've been working on now for close to two and a half years uh but the big play has been that we've moved over to uh focusing on one major use case which is gifting for prospecting so we send a gift off to somebody and then in order for them to accept the gift they take a meeting you know with us and that was just something we just saw from you know we had a few hundred customers that were uh going through the system with us and using it and we looked for the trends and how people are actually um you know using this across you know all different uh departments inside the organization so uh what we ended up doing was saying okay well there's a lot of value here because you know we're able to send a gift off to somebody to be able to generate a meeting then there's obviously a sas platform that we can or a fee that we can actually charge because the value of what we're adding and bringing to these folks is much higher than just you know hey let's just send this gift off to these individual folks and again remember part of the the model too is that we're not sending the actual gift we're sending the option for the gift so we focus very much on the gift itself being something that that the recipient actually wants which is why we've had such high conversion yeah so i want to understand more about that because remember when i was first preparing for this interview last time i think either you sent me or i sent myself a gift like the option for the gift just to see what it felt like and my first thought was i just don't know if people are going to put in this 16 digit code or whatever from the postcard on the online platform actually claim the prize you've said you've kind of built it sounds like some sort of ai or something to make sure that the incentive is very strong for me to do that yeah correct so i mean this is we've evolved a lot you know over the last year and of all the the delivery mechanism of how we actually get the gift uh link or the gift option to you uh so it started off when we when you used it last uh probably about a year ago we only had handwritten cards and it was a very long code so the first thing is that we've shortened the code down to eight digits which has increased conversion you know considerably and secondly there's a whole entire follow-up cadence that happens after the gift is is there so even if you don't put in the code we end up sending you a link to get right to the gift via email so what ends up happening is that a lot of the additional conversion happens later on so they might get the box you know which we have a whole bunch of different options for boxes and handwritten cards now and they will uh get that and then see the code and some of those folks will put in the the code of which we try and get about 50 of the people to do that and then the other 50 will end up waiting for the email or getting a reminder email and then they'll have the actual link inside of it itself okay so you have in a given month 100 of these invites go out how what percentage of those are there are claimed via the postcard and what percent right now are claimed via life cycle marketing well i think there's a better way of thinking about that which is you know if 100 of these are sent out um when it's prospecting it's cold meaning like i don't know this person and we're starting to obviously experiment with like further down the sales funnel um but when it's a cold prospect uh right now we can see anywhere between let's say six is our lowest you know all the way up to what we just had which is about 30 um you know acceptance rate and then 50 of those will be by handwritten card or by the branded box and the code being entered in versus you know the other fifty percent uh based on the actual gift link and over what period of time is that you know a month after they receive the card or send the gift usually we let it go between 45 days and 60 days actually what happens is uh somebody might even accept a gift and then it's not until 45 days later that you actually get the meeting with them um or you might actually say hey you get this big big what always happens it's a big wave up front and then there's this trickle and then all of a sudden there's some of these big pops that happen you know a little bit later on and we're just learning it's all different industries have different conversion rates um it depends on how saturated the the market is for this type of uh of direct mail uh and and it's just a very interesting like we're generating a ton of data around this based on all these different use cases on how people are using it so if a cmo is watching right now or a head of sales or chief revenue officer is listening and they say i want to run a test on this i'm going to send 100 gifts out to prospects that just have not returned any of our cold emails they send out 100 today what you're saying is over the next 45 to 60 days 30 of those will accept and of the 30 15 or so will be from the manual code from the physical mail another 15 will be from like the reminder emails hey you have a gift from alice like open it redeem it etc and then some period after that those 30 people will then book that meeting uh with uh with you know their their sales reps yeah so it would be between 6 and 30 is what i would say depending on where and what type of industry it's in and you know who they're trying to target so if you're trying to target cios for example you know you're just you're going to have a lower conversion rate than than going after somebody that's lower in the in the funnel inside of an organization because those getting listed to you know uh as as necessarily because they're sometimes they're not the decision maker but they have they have budgetary control so that's how that that would work so if a cmo is listening to this right now or ahead of inside sales or demand gen then the whole goal here is that you're actually using this as another way another touch point in the target accounts that you're trying to go after right now to be able to get their attention and then be able to use your inside sales team not to be able to follow up and then actually get that get that meeting but we also have another piece of functionality in there now which we just launched over this last month which is calendar integration so when you actually send a gift we can actually have a calendar invite automatically added to the calendar when the person accepts the gift so it's circuiting a lot of that because we learned is that a lot of times the bdrs would be...