How Analyticsintelligence CEO David Edoja grew Analyticsintelligence to $120K revenue and 7 customers in 2018.

hello everybody my guest today is hajj muns he is the uh he's building a company called analytics intelligence which is ai digital marketing and analytics assistance his background he's a royal navy was a royal naval officer for 10 years mission critical leadership and submarine service and a golf war hodge ready to take us to the top hi nathan how are you good good to talk to you you better very well thank you all right so so tell us about the company what's the company doing what's the revenue model how do you make money so the revenue model is simple sas model what do we do we provide digital assistance so there's a whole world of providing chat bots to help people improve their consumer service what we do is turn that inward to the company so people are looking at the ability to improve their customer service through chatbots we're saying actually improve your employees effectiveness so take analytics intelligence and allow your staff to focus on the 20 of what their job that makes them creative and effective and remove the mundane remove the time they spend searching for information and data so an example might be your digital analytics you might be using an analyst to provide information to your marketing team give them the ability to go straight to data themselves and ask information from the system in a natural language process through a chatbot and so what i mean what people pay on average per year per month to get access to the tech you've built say it's again sorry what do people pay on average to get access to this tech that you've built so it's about a thousand pounds per user per year and then the the fundamental model is you get two back ends included with that that's google analytics adobe analytics or tellium if you want to have additional back-end systems finance systems erp systems then you pay a connected fee which is about 5 000 pounds per year okay if we just if we look at the company level kind of the logo you're signing up instead of kind of the seat level i mean i'm trying to understand are you are we talking like enterprise million dollar deals or 10 a year deals or 100 000 ac videos generally speaking what size are you at we're talking between ten thousand and eighty thousand a year super helpful okay so you're talking four five six team members that kind of thing yeah well so it can vary so the moment we're doing this model whereby you take your first year is 50 000 um unlimited users and then true up at the end of the first year because people when they're taking on a new service they want to have to take that risk of sudden escalation in cost so would you say 50 000 a year is a fair average across your customer base yeah okay absolutely okay so where's why would people pay less why would they pay 10 uh because we're doing a launch campaign at the moment we're about to launch our company it's been a stealth mode developing product so we've got a launch coming up in early february and we're building out a customer base of of launch partners for that okay so your pre-revenue today not pre-revenue but early stage revenue okay moment it's beyond beta but it's not it's not um you know in the tens of millions yeah of course of course by the way i would say tens of millions is is way way way way after startup grow whatever yeah post revenue um put this on a time when did you launch what year say again when did you launch so the product was first started development in 2011. i didn't join the company that i joined six months ago so the founder was david adoja he he was an analyst and got fed up with being asked the same questions by business users over and over again so i wanted to create self-service for them and it grew from there interesting okay so i mean that's seven years though so i mean what was going on do they first off did he raise capital or is it bootstrapped bootstrapped 100 bootstrapped okay um he wrote the first platform himself realized that didn't do it what he needed it to do um the second platform was built with with him and other development partners and we're just using the third third generation platform now which is all about giving you that artificial intelligence that conversational piece so it's not just doing a google search on your internal information it's continuing that conversation so the same as a new colleague joins you don't learn a new language if you talk to someone in the in the canteen at lunch and then you see their desk later you remember that previous conversation so that ability to have a conversation with the system and what's the team size today how many people full time eight eight yeah in london uh all around the uk so we're a virtual team but they're not all in london absolutely not okay one of the biggest challenges for me was the submarine everyone that worked for me was in 30 feet of me yeah and rarely see the people that i work with we have conference calls frequently we talk via skype but rarely you'll be in the same place so you're about to do like a new launch but i want to first understand like baseline where you're already at today so how many customers have you scaled to today before you go do this new thing okay seven got it and i mean so are they all all seven of those are paying that fifty thousand dollar price you said no absolutely not okay yeah i know that's what i was just saying i'm like he has some revenue it sounds like here i mean so can you share i mean before you move on to this new launch i mean what are you at today in terms of revenue i mean 10 20 30 grand a month something like that 2000 a year okay 200 okay that's helpful to understand and where were you a year ago so we can understand growth year ago we were about 40 000 40 000 a year okay good that's really helpful to understand so 40 000 obviously per year comes out to i think was at 3 grand a month and now you're up to about 16 17 grand a month is that all sas is that all sas revenue uh about six percent sas the vs consulting 60 sas okay that's great so are you going i mean i should say that one more time you keep cutting out 60 sas the rest is consulting the consulting is not strategic it's building the business model so we can remain bootstrapped and build out a viable business model but at the same time we recognize that we're at a point where we're going to go and get further funding so we just start a funding round now the objective for that is to complete that in may um and that will allow us to accelerate our growth very rapidly so just to be clear 200 000 bucks today in terms of ar run rate but only about 120 of that is pure sas the other 80 is consulting exactly okay and same with about a year ago uh the ratios have changed considerably a year ago it was just consulting stuff oh wow okay so three grand a month in consulting so really zero sas back then now ten thousand sas you're looking at potentially raising capital now how much would you want to raise if you did raise so weighs about 1.5 million that's what you want to raise yeah and and how do you get to that number why is that important to get all the 1.5 where you spend it so looking at the the model i want to so the power in this solution comes actually not from the simplistic self-service but the ability to build a hive mind and a corporate memory and to build that model we need to build some rapid expansion to the the platform so we need to build access to far more back-end systems they need to be readily available to customers so when they come on board they can say i need to have an erp system i need to have a data warehouse and they need to be off the shelf rather than something we're building per customer so we need to start to predict the most popular and build those off you know off our own back and haj i'm sure this is you're still negotiating this but what what valuation are you trying to raise at pre-money what would make you happy if i can get about 5.5 million i'll be happy okay so if you raise 1.5 million on a 5.5 pre you'd be happy yeah okay well listen let me know if you end up if you end up working that out and that obviously is you know if you're doing 10 grand a month today at 120 grand per year that's obviously a massive multiple um where where where do you think you look to get that multiple so the reason we're waiting till may is because we've got four or five four deals at the moment that will massively increase our revenue over the next um four months um yeah exactly so the logic is bring those on board first and then and then complete the round so we're doing the ground work now talking about what we're what we're proposing but we are not expecting to complete the round until until end of april early may i understand the dynamic why do you join a company like this super small you have clearly a pedigree background uh you know obviously engineering you know naval disciplined i mean why join this company because i think it the technology and the approach is transformational so everyone is looking at you know ai chat bots how they deliver but actually the real value isn't delivering to your customer the real value is you know if you look at all the dynamics in the in the current marketplace people are changing jobs more frequently so someone says in a row three to five years it takes you three to six months to find their replacement it takes you 12 to 18 months for that replacement to be...