How iAdvize CEO Julien Hervouet grew iAdvize to $48M revenue and 1.5K customers in 2024.

hello everyone my guest today is nicholas de rosen he is the ceo of a company called i advise uh specifically north america he's got a lifelong experience in the technology industry before i advise he launched to develop two businesses in the real estate and online retail spaces one of them cynthio became a major player in the industry he also has experience as a venture capital investor by training he's an energy and telecommunications engineer and holds an mba from insead okay nicholas are you ready to take us to the top all right all right well first off congrats on on leaving the dark side the vc world and joining the operating side you get way more cool points in my book for that walk me through the company what do you do and how do you make money uh all right advice is a conversational experience platform we help e-commerce brands build conversational strategies to connect with their online shoppers and remove the friction on the customer journey we make money quite being very straightforward we are a sas company monthly license based on the number of conversations that brands are having through our platform interesting okay uh number of conversations is this uh this is uh so someone uses you it's conversational marketing they chat with a million customers especially during like the black black friday period where there's a lot going on you're basically charging per conversation with each individual potential customer absolutely and there are many different conversations right there's of course conversation with live chat it can happen through facebook messenger sms click to call click to video many different possibilities you could be engaging with chatbot an in-house agent and on-demand experts it's essentially a toolbox so that each brand can build its own conversational strategy but whatever uh the feature they use a conversation stays a conversation and this is what they pay for i see and give me a general sense here of what kinds of customers you know your average customer looks like in other words are they paying you know 10 bucks a month a million a month a grand a month what's kind of the average customer pay per month would you say or per year yeah sure um i think the essentially two answers to this first of all uh i advise is initially a european company so we are a european leader in uh back there and we opened the u.s office last year after raising a 38 million dollars in the serious round so the big focus now is in the us that the answer to question is different depending on if we are in europe or in the us in europe like all companies all startups you start off with a lot of customers that don't pay much and then as you go you try to target bigger and bigger customers right um so there is a bunch of customers that we we signed up in the first years of the company they are not paying much typically 100 200 dollars per month but now in the us we are targeting companies that are paying between 50k and 1 million per year so let me ask you let me ask you a different question nicholas this is interesting uh if you look at the your total revenue past 12 months what percent was europe versus u.s um let's say that u.s uh this year so this is the first year officially in the u.s we are uh targeting uh a million dollars of new booking so we are now you know when you enter a new market the focus is more how much you sign rather than the revenue and let's say that this represents probably uh something around the of the new booking around 10 oh wow okay so so even though you're charging way way more than your european counterparts it's they must have a huge volume of you of customers then uh yeah absolutely yeah we have around 1500 customers so definitely a lot of customers i see i see got it so 1 500 customers and i want to make sure i understand what you just said you're targeting you know for ending here 2018 basically a million bucks in new bookings and that represents only one tenth of a total kind of 10 million in new bookings that the whole company will bring in that's correct i see interesting now you mentioned a big round of funding you also mentioned you were passed to vc did you come in at you know with that round of funding you were like an eir out of vc and then you joined myself yeah uh no i've been actually from you could i'm a late stage founder i joined the company something like three years ago when the company was completely pivoting right we started off with a very basic live chat solution and then we adapted and we are now pivoting on uh the the core feature of what we sell what has been driving our growth over the last two years is an on-demand community of experts so it's a sort of uber-like solution but in customer experience it means that when you go on the e-commerce website and you have questions you i'm sure you're familiar with the typical live chat experience um what makes us special today is that you will not be engaging with an in-house agent you will not be engaging with a bot you'll be engaging with someone that has been sourced and i advised and identified by advice as being highly passionate and knowledgeable about the products the brand is selling so that person is on a smartphone and just sharing advice and gets a percentage of the sales that he gets that he generated through his advice interesting so but just to be clear you're not employing a marketplace model where you're basically connecting freelancers with conversational jobs and taking a cut in between you're pure sass for that specific feature uh yes it is a marketplace we are a software editor and we are connecting some on-demand experts with brands or more specifically with the brand's online shoppers so we make the connection we take a percentage of whatever those experts are generating i see are you generally moving more towards the marketplace percentage model or is sas still dominant and you you keep doubling down there no it's clearly starts dominant let's take a step back to understand why we came up with that of that feature as a brand when you want to set up a successful conversational strategy you have two problems you need to solve the first one is the technology right what engagement technology are you going to use to engage with your online shoppers plenty of vendors out there fine second problem which is a real bottleneck of the market is the resource right it's who on behalf of the brand will engage with the online shoppers and when two or three years ago when we analyzed data from our around 1 000 customers we noticed that around 70 of the engagement opportunities were missed by brands meaning it's people on websites that have questions that are frustrated and brands are not doing anything to engage with them by lack of resource because they're not available 24 7 because they don't have the the workforce to engage them so this is when we developed that feature i've mentioned the communicative on-demand expert but this is just a way of generating more conversations for our core platform which is about uh which is a technology to do to provide uh conversations so that's uh the core of our revenue is still being generated by the sas model yeah the marketplace is almost like a growth channel for you it's helping just add additional value on to what you already have absolutely just a way of generating more conversations yeah that makes a lot of sense um the company was you said the pivot happened three years ago so 2014-2015 when was the company founded though before that 2010 2010 okay wow so they kind of kind of wobbled around for a little bit there for a couple of years and then pivoted away from that and you started you said startup has just a live chat software uh initially it started the live chat software uh but as you can imagine we had to go beyond being just live chat software because today if you are just livestream you have no chance of surviving yeah uh so i mean there's a couple by the way nicholas there's a couple kind of you know olark right some of these folks are you know they just came on the show doing about 25 30 million bucks in ar but they're getting kind of killed by these newcomers like drift and intercom and hubspot's new tool absolutely and by the way yeah you've mentioned intercom you mentioned drift what makes these guys special is the respondent again having an engagement technology plenty of technologies out there typically olark but the bottleneck again is the respondent is who will engage with those online shoppers and the answer to that problem for drift and intercom are bots so bots are providing the content to those frustrated um uh online visitors how much capital has the company raised to date you mentioned your last one was 38 million was that all the capital no total over 60 million 60 okay total and how much of that came pre-pivot um the amount the pivot uh started on the series b round series b it was around 18 million dollars and what convinced the investors to invest was the pivot so this is when we started the pivot and then the last round of 38 million was to accelerate the pivots and do a specific focus on the u.s u.s market being definitely a very attractive market and what's the team size today total european and us 250 employees 250 how many are us kind of under you strictly in the u.s we are 10 okay may make sales but absolutely it's definitely customer oriented so it's marketing sales and customer success customer success is a big part of the advice culture yup yup no of course and then walk me through kind of growth targets so so over the past you know going back a year ago to we're about to end 2018 what do you guys hope to grow by year over year um the typical yeah the growth that we've been having so far on average is around 40 per...