Founder Interview
How Amplify Crossed $1M ARR in Early 2019 and Grew to About 130 Brand Customers (Interview with CEO Mahi de Silva)
- Interview Date
- May 21, 2019
- Interviewee
- Mahi de SilvaCo-Founder and CEO
Company Metrics at Interview Time
ARR (early Q1 2019)
$1M ARR
Customers (2019)
130
Team Size (2019)
25
Total Funding
$3M
Logo Churn (total since inception, as of May 2019)
Less than 1%
Historical Snapshot
These numbers were reported by Mahi de Silva during the interview recorded in May 2019 and are a historical snapshot, not current figures. See Amplify’s current numbers.
Key Takeaways
- 01Amplify crossed $1M ARR in early Q1 2019
- 02The platform served approximately 130 enterprise customers as of May 2019
- 03Tony Robbins was a named customer using Amplify for conversational marketing
- 04Amplify had driven more than 2,900,000,000 consumer interactions for its brands
- 05More than 195,000,000 consumers had been attracted onto the platform
- 06Logo churn was less than 1% since the company's inception
- 07Average per-customer expansion was approximately 25% annually
- 08The company had 25 employees across Silicon Valley, Europe, and Asia
- 09Amplify raised a $3M convertible note seed round in 2017 led by Costanoa Ventures
- 10The company had 3 quota-carrying salespeople as of May 2019
Company Metrics at Time of Interview
| Metric | Value | Source |
|---|---|---|
| ARR (early Q1 2019) | $1M ARR | Founder interview, May 2019 |
| Customers (2019) | 130 | Founder interview, May 2019 |
| Team Size (2019) | 25 | Founder interview, May 2019 |
| Sales Reps (quota-carrying) (2019) | 3 | Founder interview, May 2019 |
| Total Funding | $3M | Founder interview, May 2019 |
| Funding Round (2017) | $3M Convertible Note | Founder interview, May 2019 |
| Logo Churn (total since inception, as of May 2019) | Less than 1% | Founder interview, May 2019 |
| Per-Customer Annual Expansion (2019) | 25% | Founder interview, May 2019 |
| Consumer Interactions Driven (cumulative, as of May 2019) | 2,900,000,000 | Founder interview, May 2019 |
| Consumers Attracted to Platform (cumulative, as of May 2019) | 195,000,000 | Founder interview, May 2019 |
| Base Platform Price (2019) | $1,000 per month | Founder interview, May 2019 |
Growth Breakdown
Revenue
Amplify crossed $1M ARR in early Q1 2019, having started signing customers in 2018. Mahi said the company would "probably double that" by the end of Q2, a target at the time of the interview rather than a result. Asked whether growth was coming from expansion or new customers, he said it was a mix, with new customers adding more.
Customers
As of May 2019, Amplify served approximately 130 enterprise brands around the world. The platform had collectively driven more than 2,900,000,000 consumer interactions and attracted more than 195,000,000 consumers across those brands.
Team
Amplify had approximately 25 employees at the time of the interview, with staff in Silicon Valley, Europe, and Asia. The go-to-market team was small, with 3 quota-carrying salespeople and a customer success organization focused on enablement and account expansion.
Funding
Amplify raised a $3M convertible note seed round in 2017, led by Costanoa Ventures, with additional friends-and-family angel participation. Mahi called a convertible note of about $3M "the sweet spot" for a seed: go for more, he said, and VCs want to treat it as a priced round.
Growth Strategy
Founder-Led Selling and Network
Much of Amplify's early customer acquisition came through what Mahi called "early stage founder selling": "A lot of that is Rolodex, you know, leveraging sort of your friends and network." As a result, he said, "we spent very little money on customer acquisition."
Usage-Based Expansion Model
Amplify started customers at a base price of $1,000 per month for a set number of conversations, then scaled pricing as usage grew. Mahi put per-customer growth at about 25% a year, with some customers growing over 100% and, he agreed, some not growing at all. Because pricing starts low and scales with the value delivered, he said, there had been "no instances where revenue is actually coming down on a per customer basis."
AI-Driven Stickiness
From day one, Amplify accumulated consumer data, preferences, and profiles on behalf of each brand. The founder argued this created a natural lock-in, because no enterprise customer would want to abandon the AI investment and the data it had built up.
Multi-Channel Conversational Engagement
Amplify connected brands to consumers across Facebook Messenger, WhatsApp, Instagram, Apple Business Chat, and Google Android Messages, letting consumers choose their preferred platform. The examples Mahi gave were the first paying customer, a media company in Southeast Asia; Tony Robbins; and the mobile operators around the world Amplify was working with.
Customer Success as Expansion Engine
The customer success team was compensated on a variable basis tied to account value, account expansion, and new feature adoption, aligning their incentives with revenue growth even though the team did not carry a quota.
Best Quotes
“We're an enterprise SaaS platform. We are an artificial intelligence and machine learning platform that helps brands drive conversational engagement. So customer acquisition, engagement, commerce with consumers around the world.”
“Tony Robbins is a customer of ours. And, you know, they do a lot of digital marketing on the web and social media. And we help bring those customer engagement events to life through AI powered conversations.”
“We do year long contracts, but we start with, a thousand dollars a month, to access our platform. That comes with a set number of conversations. And if you exceed those, then you pay more, you move up to a higher tier.”
“We have about 25 people around the world, and we've got people here in Silicon Valley, folks in Europe and Asia as well.”
“We have extremely low churn. You know, we're looking at like, you know, less than 1%.”
“What makes us sticky is that we are basically an AI investment a company makes. From day one, we start to amass huge amounts of data, preferences, profiles for these consumers that interact with that brand, and no brand wants to just turn that off.”
What Happened Next
At the time of this interview in May 2019, Amplify had crossed $1M ARR in early Q1, and Mahi expected to "probably double that" by the end of Q2: a target, not a result. The go-to-market team was still small, with three quota-carrying salespeople, and the company was in the process of hiring SDRs. Visit the Amplify company profile on GetLatka for the most current data available.
View Amplify’s current profile and metricsFull Transcript
Chapters
- 0:00Introduction and Background
- 0:39What Amplify Does and Its Revenue Model
- 1:08Tony Robbins as a Customer Example
- 1:50Pricing and Contract Structure
- 3:41Company Founding and Platform Scale
- 7:12Team Size and Fundraising
- 8:34Churn and Revenue Retention
- 10:43Sales Motion and Go-to-Market Team
- 11:44Customer Acquisition Cost and Growth Philosophy
- 14:35ARR Milestone and Growth Trajectory
- 15:22Famous Five Rapid Fire Questions
Introduction and Background
Nathan Latka
00:00Hello, everyone. My guest today is Mahi de Silva. He is a serial serial entrepreneur creating multiple billion dollar exit. He's the cofounder and CEO of Amplify.ai. Today was previously chairman of Noventis, CEO of Opera Mediaworks, CEO of AdMarvel, CEO of Frengo. He's also on the founding team and GM of wireless services VeriSign and an engineering geek at Apple. He was named number 12 of the most important people in mobile advertising by Business Insider.
00:27He's also known for pioneering off deck premium mobile content in The United States by convincing the top tier carriers to open up their walled garden for digital content. Mahi, are you ready to take us to the top?
Mahi de Silva
00:38Sure.
What Amplify Does and Its Revenue Model
Nathan Latka
00:39That's a loaded bio man. Holy mackerel. Whoo. Alright. What's Amplify doing, and what's your guys' revenue model? Are you pure play SaaS?
Mahi de Silva
00:46Yeah. We're an enterprise SaaS platform. We are an artificial intelligence and machine learning platform that helps brands drive drive conversational engagement. So customer acquisition, engagement, commerce with consumers around the world.
Nathan Latka
01:04Okay. And can you maybe tell a story about one of your customers and how they do that?
Tony Robbins as a Customer Example
Mahi de Silva
01:08Yeah. You know, a great example is Tony Robbins is a customer of ours. And, you know, they do a lot of digital marketing on the web and social media. And we help bring those customer engagement events to life through AI powered conversations. So whether you see an ad that might be running on Facebook or Instagram or see an ad that runs on the web, on desktop or mobile, when you click those ads, you start a conversation
01:45as opposed to, you know, a self guided tour, with a click to web experience.
Pricing and Contract Structure
Nathan Latka
01:50Yep. That's interesting. And and can you help me understand... I don't wanna go down every customer cohort, but on average, what's the company gonna pay you per year to use this technology?
Mahi de Silva
01:59So we start with a base price.
02:04You know, we do year long contracts, but we start with, a thousand dollars a month, to access our platform. That comes with a set number of conversations. And if you exceed those, then you pay more, you move up to a higher tier.
Nathan Latka
02:21Are there any other pricing axes you price against besides number of conversations?
Mahi de Silva
02:26That's really our core metric because that's what ultimately moves the needle for our customers. How can we drive engagement, and how can that engagement map to something that's monetizable?
Nathan Latka
02:38Okay.
02:39No per seat model?
Mahi de Silva
02:41That's not something that we've contemplated, but I'd tell you we're flexible. You know, we have new customer inquiries every day. We're working with, you know, mobile operators around the world that are trying to streamline their marketing and their customer support. So we never say never for innovative new business models, but conversations is our core
Nathan Latka
02:41No feature based upsells either?
Mahi de Silva
03:29So when we have to do special integrations for customers, there's an opportunity for us to, you know, price that as a new feature.
Nathan Latka
03:38Okay. But you're not actively doing that?
Mahi de Silva
03:40No.
Company Founding and Platform Scale
Nathan Latka
03:41Yeah. Interesting. Okay. Tell me more about your story here. When did launch the company? What year?
Mahi de Silva
03:46So we started at the end of two thousand seventeen. We've been... We spent most of '17 building the platform and proving out our scale. 2018, we started signing up customers. You know, here we are in the middle of May. We've driven more than 2,900,000,000 interactions with consumers for our brands.
Nathan Latka
04:09Does that mean a conversation impressions?
Mahi de Silva
04:12Yeah, no, this is all conversation based. And we have attracted more than 195,000,000 consumers onto our platform.
Nathan Latka
04:23Okay, and across how many companies using you have these 2,900,000,000 conversations happened across?
Mahi de Silva
04:28You know, let's call it about 130 big brands around the world.
Nathan Latka
04:35Okay, so let me repeat that back to you to make sure I get it right. 130 customers use you by using you they've driven over 195,000,000 engagements with consumers. And those engagements have total over 2,900,000,000 total conversations over the past twelve months.
Mahi de Silva
04:49That's right.
Nathan Latka
04:49That was pretty good. Am I hired?
Mahi de Silva
04:52You're hired.
Nathan Latka
04:54Alright, so 130 customers Take me back to like the glory days. So the first paying customer, how'd you land them?
Mahi de Silva
05:03Yeah. The first paying customer, we were able to show them, you know, we did a thirty day free trial. We were able to show them how we could leverage kind of their nascent activity on social media to bring those people into a more monetizable engagement. So, you know, something as simple as a comment that you left on a Facebook post, being able to understand that comment, be able to turn that from a one to many experience,
05:37like a feed based experience, into a messaging experience. So that first customer, you know, today, we've helped attract millions of new customers for them. This is a media company in Southeast Asia.
05:54And, you know, they're super happy with what we have been able to do and continue to do for them.
Nathan Latka
06:00So what would a media company in Southeast Asia, why would they want to pull a conversation on Facebook into a one to one chat when usually a media's revenue model is based on advertiser spend, not one to one conversations with consumers?
Mahi de Silva
06:12Yeah. So think about whether it's a media company here or in Indonesia or Australia. If you go to, let's say, CBS Sports,
06:26and you're a new user, you're perusing their web experience, they're going to tell you very quickly, hey, sign up for my newsletter, which is an email blast of CBS Sports content that shows up at inbox. Well, what we do is we don't sign up for a newsletter on email, but we can help push that that media company's content to that consumer on the social messaging platform of choice for the consumer. So it could be WhatsApp or
06:59Facebook Messenger or Instagram or Apple Business Chat, Google, Android messages. The consumer decides where they want to consume that content, and we help push that content to that consumer.
Team Size and Fundraising
Nathan Latka
07:12Interesting. What's your team size today? How many people?
Mahi de Silva
07:15We have about 25 people around the world, and we've got people here in Silicon Valley, folks in Europe and Asia as well.
Nathan Latka
07:26Have you decided to raise or stay bootstrapped?
Mahi de Silva
07:29So we raised a seed round back in 2017 that was led by a venture firm here in in Palo Alto called Cosanoa Ventures.
Nathan Latka
07:42And was that the only only capital in?
Mahi de Silva
07:44Yeah. We have some some friends and family, you know, angels as as well.
Nathan Latka
07:50Yep. And so total total capital in the company today is about how much?
Mahi de Silva
07:53I think what we've raised so far is about little over $3,000,000.
Nathan Latka
07:58Okay. And and how did you know? I mean, a lot of founders struggle if they do wanna go the VC route with coming up with how much to raise, especially at the start. Right? So why was 3,000,000 the right number for you?
Mahi de Silva
08:08Yeah. The the reason is that, convertible note, and that was kind of the sweet spot. Right? If you if you go for more than VCs wanna treat that as a price like a series a round, so that 3,000,000 was like a a good number for for a seed.
Nathan Latka
08:25Yeah, that's a pretty large convertible note though.
Mahi de Silva
08:28Yeah. I think that's maybe based on our experience and history.
Churn and Revenue Retention
Nathan Latka
08:34Yeah, no, fair enough. Talk... You know, churn's critical in any SaaS company. How do you think about your churn and getting it to a better place than where it's at today?
Mahi de Silva
08:43Yeah. We have extremely low churn. You know, we're looking at like, you know, less than 1%.
Nathan Latka
08:49Annual or monthly?
Mahi de Silva
08:52Forever, you know, since the inception of the company total. And the reason
Nathan Latka
08:52Just to
08:58be clear, that logo churn or revenue churn?
Mahi de Silva
09:02That's logo churn. Yeah. So what makes us sticky is that we are basically an AI investment a company makes. From day one, we start to amass huge amounts of data, preferences, profiles for these consumers that interact with that brand, and no brand wants to just turn that off. So, you know, we deliver a lot of value, and that value has natural stickiness inside of an enterprise.
Nathan Latka
09:35Is revenue churn about the same, less than 1% annually?
Mahi de Silva
09:39Yeah. And again, because we start at such a low price point and we scale based on the value that we deliver to the enterprise, we've had no instances where revenue is actually coming down on a per customer basis.
Nathan Latka
09:54Yeah. That's what was going to ask you next. It sounds like you have an expansion machine in place. So what is that typically year on year? Are you looking at 40% expansion, 20% more?
Mahi de Silva
10:03I think today we're still in the nascent phase of really AI as a platform for enterprises. So we're looking at, you know, 25% growth on a per customer basis annually. But we've had some customers, you know, grow over a 100% because they're
Nathan Latka
10:22And some obviously are below that. They don't grow at all.
Mahi de Silva
10:25Exactly.
Nathan Latka
10:25Yeah. Yeah. So if you assume 1% churn and 25% expansion, that still puts obviously your net revenue retention at, call it, 24 ish. It's still obviously a healthy place to be. Yeah. What's your current sales motion look like? Right? So you told me about getting your first customer, your team of 25 today, are there kind of SDRs and AEs and CS reps, or how are you getting new customers?
Sales Motion and Go-to-Market Team
Mahi de Silva
10:43Yeah. We're still a very small go to market team. You know, we have three quota carrying salespeople around the world that, you know, between myself and those folks have been focused on bringing that, you know, those customers in. We are in the process of hiring SDRs. We have a customer success organization.
Nathan Latka
11:07Are they quota carrying as well, the CS folks?
Mahi de Silva
11:10No, they're not. They're really focused on enablement.
Nathan Latka
11:14Yeah. But doesn't good enablement drive expansion revenue?
Mahi de Silva
11:17Absolutely.
Nathan Latka
11:18But don't give them an upside of that piece?
Mahi de Silva
11:21We give them an upside in terms of incentive compensation, but it's not Commissioned.
Nathan Latka
11:28Yeah. Yeah.
11:29Yeah. So what do do? It's like a flat bonus fee if x amount of retention is hit?
Mahi de Silva
11:33It's a variable, you know, based on, account value, account expansion, new feature adoption.
Nathan Latka
11:41Interesting.
Mahi de Silva
11:42It's pretty dynamic.
Customer Acquisition Cost and Growth Philosophy
Nathan Latka
11:44How aggressive are you being in terms of fully weighted CAC to get a new $12,000 a year account? I mean, will you spend the whole first year of ACV to acquire the customer?
Mahi de Silva
11:54Typically not, right? A lot of this has been, you know, what I would call sort of early stage founder selling. A lot of that is Rolodex, you know, leveraging sort of your friends and network. So we spent very little money on customer acquisition.
Nathan Latka
12:14Yeah. Yeah. But you have to have some thesis around a pro forma of a new salesperson if you're looking at bringing on SDRs and things. So you have a best guess of CAC. I mean, what are you modeling your fully weighted CAC at?
Mahi de Silva
12:26To be frank, we haven't done very good modeling around that, but we're certainly willing to
12:35spend somewhere in the order of 25% of ACV to go acquire a customer.
Nathan Latka
12:43Yeah. I mean, that's not that aggressive at all for most people in B2B, especially venture funded B2B SaaS. Why so conservative?
Mahi de Silva
12:53I think it's one of these areas where we don't want to be too ahead of the curve. We're very realistic. We work in a market where, as Gartner would put it, we're kind of in the... We're coming out of the trough of disillusionment in the Gartner hype cycle around AI and marketing. There's been a lot of people out there pitching AI when they really don't have much in terms of machine learning or natural language processing. So
13:27we don't want to get too ahead of ourselves in really seeing where the market traction is.
Nathan Latka
13:32Mahi, sorry. I don't understand what that means. What... How would... If you were ahead of the market, how would that manifest itself in the current numbers you're seeing?
Mahi de Silva
13:41Well, what we don't wanna do is to convince a bunch of people to try this stuff when they're not quite ready to do it.
Nathan Latka
13:48But that's not happening with you. You have less than 1% annual churn. Argue your lifetime value. Now you would never obviously plot this, but you could argue your lifetime value is infinite. But you're saying we're only willing to spend $4 to get a new customer.
Mahi de Silva
13:59That's because, you know, as we scale the business, we wanna make sure that as we go into new verticals, our platform is proving out to do everything that we, you know, set out to do. And we're patient about doing that.
Nathan Latka
14:14That's fair enough. No, I respect it. That's great. And in terms of size, you mentioned earlier about 130 customers, and you also said earlier about a thousand dollar a month is a fair average. So I mean, that puts you at somewhere around $130,000 a month right now in revenue. Is that basically right?
Mahi de Silva
14:26Yeah. It's a little more than that.
Nathan Latka
14:28Okay.
14:30And talk to me a little bit about growth. So a year ago today, do you remember where you were at?
ARR Milestone and Growth Trajectory
Mahi de Silva
14:35Yeah. I mean, a year ago, we were just starting to bring customers on board. I'll tell you that a milestone that we hit early this year was breaking the million dollar ARR
14:50threshold, but we'll probably double that, you know, by the end of
14:54Q2.
Nathan Latka
14:55Well, yeah, if you're north of 130 already now, that's way north. I mean, you gotta get up to about, what is that? 164, 166 to be 2,000,000 ARR?
Mahi de Silva
15:03That's right.
Nathan Latka
15:04Yeah. So did you... When did you break the 1,000,000 ARR? Like December 2018?
Mahi de Silva
15:07No. It was like in early Q1.
Nathan Latka
15:10Okay. Okay. Good. Very good. That's good. Well, that's healthy growth. And is most of that growth coming from expansion revenue or new customer ads altogether?
Mahi de Silva
15:18I... I'd say it's it's a mix, but the new customer ads are adding more.
Famous Five Rapid Fire Questions
Nathan Latka
15:22Yeah. Yeah. Interesting. Okay. Very good. Let's wrap up here with the famous five. Number one, what's your favorite business book?
Mahi de Silva
15:31What I would recommend right now is a book called Social Physics. It's written by an MIT professor. And it just... It's very eye opening around sort of how people interact and social media and how to tap into that.
Nathan Latka
15:48You're about Alex Pentland's book?
Mahi de Silva
15:50Yeah.
Nathan Latka
15:50Yeah, very good.
15:51All right, number two, there a CEO you're following or studying?
Mahi de Silva
15:58Not right now.
Nathan Latka
15:59That's okay. Three, what's your favorite online tool for building your company?
Mahi de Silva
16:06Slack.
Nathan Latka
16:07Number four, how many hours of sleep are you getting every night?
Mahi de Silva
16:11Not enough.
Nathan Latka
16:12What's your best guess now?
Mahi de Silva
16:15Five hours.
Nathan Latka
16:16Okay. And what's your situation married, single kiddos?
Mahi de Silva
16:19I'm married. I have three kids, two in college, one in high school.
Nathan Latka
16:25Amazing. And how old are you?
Mahi de Silva
16:28I'm 53.
Nathan Latka
16:2953.
16:30Last question. What do wish your 20 year old self knew, Mahi?
Mahi de Silva
16:34Take more risks.
Nathan Latka
16:36Tony Robbins uses him amplify.ai serving about 130 enterprise customers paying a grand a month. So north of $130,000 per month right now in revenue. That's up from, you know, call it a million dollars in terms of run rate just four or five months ago. So fast growth right now, churn less than 1% annually, expansion north of 25. So a 124% net revenue retention, 25 people on Mahi's team, 3,000,000 raised. They've generated 2,900,000,000 conversations for brands across
17:03a 130 of those... Sorry, 195,000,000 of those brands customers. So healthy growth and get a 130 brands using the platform. Mahi, thank you for taking us to the top.
Mahi de Silva
17:12Thank you.
Nathan Latka
17:13One 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 alive. It is fun to watch every Thursday, one
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