Istaysafecorprevenue & funding

hello everybody my guest today is karen cantwell she was a born innovator in 2014 she launched tic launched tick-tock track the first gps smartwatch globally for children followed up with a bespoke software monitoring platform that platform now hosts multiple gps devices providing one platform for the safety of everybody in your family shields an mba from q-u-t karen are you ready to take us to the top yeah for sure i'd love it to be talking to you okay so tell us about i stay safe what's the company do specifically and are you a hardware company or a pure place sas company so we're pretty much a little bit of both uh when we first started in 2012 with tic toc track it was primarily to have a hardware solution for children to keep them safe by the watch um but then we realized that we could help so many more people through a um a software solution that integrated other gps devices to keep people safe so um so then we kind of over the last two or three years has sort of pivoted into more of a software slash hardware company and we operate via a sas business model okay and what is the company ticktacktrack.com.a you or kind of the istaysafecorp.com so i stay safecorp.com.uuuuuu is it's i stay safe as a company and i stay safe really focuses on the software as a service solution um tiktoktrack was our primary product that we actually launched to market in 2014 which was a child safety watch which one is pure assassin the first one the first one okay so let's focus on that for the rest of the interview just for the sake of clarity even though understanding your first success came in the form of this tick tock track concept so for before i stay safe you know help me understand when people pay for the service what are they getting uh and and um and what do they pay on average per month so basically i stay safe is a software platform now that integrates multiple tracking devices so when someone pays a service fee they're um adding a device or a hardware piece to keep someone in the family safe so um if they're adding a mobile phone to track their um the adult child or their loved one then that they're looking at sort of around 3.50 a month for the service to add it to our platform and receive all the features if they're adding a tip-top track watch for one of the younger children then um the service starts at around 12 a month because there's a sim card in the watch that we provide as well so um it ranges from about twelve dollars up including the sim so what i mean just because i don't want to go down every product skew and every customer cohort on average when someone signs up with you are they paying 12. around six dollars a month six session okay so maybe it's like you know two of the things or one tick tock top and then one three dollar thing yeah okay great depending on who you want to keep safe and the family is what sort of device you add to track via our software platform yep yep and when did you launch the company what year so we started the company in 2012 launched our first solution in 2014. that's great now the early days are obviously really tricky how do you support yourself those first two years um so i had a um an advertising agency that i um that i owned so that was my first business so i basically ran that um to provide an income while i was getting um i stay safe up off the ground and just work from home that's great now over the you know obviously you're going through all the trenches making it happen now four years later what have you scaled two in terms of sorry i guess it's yeah it's four years how many customers have you scaled to so um we've mainly focused on australia to sort of get it right here before we go globally so um we've got over a thousand subscribers on our database at the moment um and they're in every state in territory across australia and we're now just starting to look at the global market that's great i mean that's wonderful karen congratulations i want to talk more about how you got those customers first and and why just australia first i think there's probably some lessons there can i take that thousand times that six dollar price point you're doing about six grand a month right now yeah so with the majority of our customers were probably selling on the tick tock track watch too so at the moment our average um recurring revenue was around 20 grand a month oh wonderful okay great when we scale it would be on average around six dollars a month but at the moment we're doing around 20 months you're saying so moving forward the average you think is going to settle out more towards six but currently it's too tall um yeah but at the moment our primary um product is the watch which is the higher price point per month that's great okay good so about 20 grand a month today and taking back a year so in december of 2017 how much were you doing a month um probably around 11. okay good so you've about doubled year over year how are you getting all these customers that's impressive a thousand um so i think mainly a lot of it's been word of mouth we have um um disabilities and um autism community where that's been really strong support for us in helping kids in that area um we've done a lot of publicity a lot of pr and um we've done a little bit tv advertising as well to really um to grow our brand um nationally so when you look at all these kind of paid efforts in order to get a new kind of 12 or 20 a month customer what do you pay typically to get that customer yeah it's probably around three or four dollars per customer okay and most that's tv ads and that would be our biggest expense but the majority of our advertising is online social through facebook um instagram twitter um we do a lot of facebook advertising um we do probably maybe one to two tv campaigns a year okay but we don't do that on a regular basis it's too expensive yep yeah what does that mean what does a tv campaign cost well in australia we probably spend between 100 and 150 000 for each campaign and what is that like a 30 second spot so that'll be a 30 to 50 a combination of 15 to 30 second spots probably over about a six week period there might be one or two weeks there where we're not on on television but um just over a six-week flooded period it's probably yeah okay 100-150 and have you bootstrapped the company or raised we've raised okay so i started off um purely just myself um began with just investments um from friends and family to small investments to actually get the product to market and the solution to market in 2014 and then um took on an angel investor um in november 2015. okay so how much total have you raised uh 1.6 million okay got it and and was that pretty easy to raise that in australia i don't know what the funding market's like down there no it wasn't easy you're like it was definitely not easy yeah i was really fortunate when i started because i mean the um investment market here in australia certainly over the last three years has really kicked up a notch like it wasn't like that when i started um so i was really fortunate i had super supportive friends and family um but in the last few years i think there's there's been more of a focus but it's still i think we're still probably a little risk-averse here in australia in terms of supporting new tech there's still that kind of desire to wait until it's proven before we invest um i'm fortunate that the angel investor i got was introduced to me through a friend and he's just just the most amazing mentor and investor you could have like he's super supportive and doesn't put any pressure on um so if you can get an investor like that i mean it's it's huge yep are you cash flow positive today are still burning money we're still um we're still not quite break even um but we're we're debt-free and we we have money in the bank so i love that debt free is great so when you say you're burning i mean are we talking like a grand a month or like 20 grand a month we're probably we're probably burning about 10 grand a month at the moment that's mainly through staff um salaries obviously yeah because i i had to i physically couldn't handle it all myself so i had to put on some stuff we've still only got 3.4 um full-time equivalents so there's still not a lot of us in the business wait karen how do you work out three point four you have a fourth of a human or four four nine like a part-timer and a casual and so you out of pull around you kind of make the equivalent welcome to the company we're cutting you in half we only want half of you okay yeah so four full-time people three three to four full-time people yeah yeah that's great and where's everyone based so pretty much most of us are based here in brisbane but then we have one staff member in cairns north queensland um she went on maternity leave working for us and then wanted to come back to the company but her partner had been transferred there so we set up a remote office so she could keep working for us well that's great what about churn um in terms of staff yeah no no sorry churn in terms of you someone signs up for 12 a month customer do they stick with you what's turn like generally um our customers will stay with us between 12 to 18 months we've still got some customers that will um that have been with us for the four years and they've gone through various iterations of devices and added different devices but um generally 12 to 18 months is the life cycle of the customer okay so you're churning about seven percent of customers per month or maybe like 80-ish or 85 per year yeah yeah around five to seven a month yeah yeah and why are they i mean this sounds like something that like once people install it they should have won it all the time they're keeping their kids safe why are people churning i think um the child grows up so um that's why we added the other devices to the platform because we were finding the younger children were using the watch and then when they grew up and started getting a phone the parents were like well we don't need to service anymore so now that we have iphones and androids on the platform they continue with us as a customer but that was only released in april this year so we're yet to see that the impact of that in terms of the chant i see interesting very good karen let's wrap up here with the famous five number one what's your favorite business book that's a tough one i think some anything by fern harness is really good yeah rockefeller habits is a good one yeah anything like rockefeller's is a good one that yeah that would probably be one up there in the top number two is there a ceo you're following or studying um i'm just at the moment i'm following the ceo vodafone group in the uk nick reed because sim cards are a huge part of our solution so i've sort of been following what he's been doing just look out for a partnership with him number three what billing tool do you use we use zero okay number four how many how many hours of sleep to get every night around five to six okay so not horrible and what's your situation married single kiddos married two kids two boys eleven and seven oh and do you mind asking how old you are forty five forty five last question karen what do you wish your twenty year old self knew um but you could actually be successful doing what you wanted to do because i don't think i really believe that that was possible back then guys you can be successful doing what you love she launched i stay safe corp which basically helps you keep your family members safe now over a thousand members paying to keep their members safe uh 20 bucks a month an hour doing about 20 grand per month today uh that's up from 11 grand a month just about a year ago so healthy growth burning about 10 grand per month but they've raised about 1.6 million bucks from a nice angel down in brisbane in australia four people full time again all down there in brisbane about 85 percent logo churn per year that's why they're adding new products to basically tie up and and expand more of the product cycle spending caught between uh two and four bucks to acquire one of these new customers so quick payback period karen thank you for taking us to the top thank you very much for having me have a great day