How Istaysafecorp CEO Karen Cantwell grew Istaysafecorp to $360K revenue and 2.5K customers in 2022.

hey folks my guest today is karen cantwell she's somebody that constantly innovates and in 2012 she started i stay safe with a mission to design a personal safety watch for children i was gonna say kids for children this led to the launch of tick-tock track in 2014 one of the first kids smart watches in the world karen are you ready to take us to the top sounds great all right so is this pure status or is it sas plus hardware plus consumer what's the mix so it's pretty much sas plus hardware so we do both interesting okay so talk about the hardware do you have a can you show it to us do you have the hardware today yes so we have uh we have two devices at the moment we've got a 3g which is it's a small kids watch um we also use it for elderly we also use it for domestic and family violence loan workers um so we've got quite a few verticals that we operate in um it's basically small lightweight it has um an sos duress function on it um so it's it's close to the camera it's like an iowa it's like an iowa it's like an apple watch basically yeah so it's like it's it it can just look like a sports watch it has a magnetic charging clip on the back um so we do that we also have a um we also have a phone application which has a remote bluetooth button that is just like a button on your keyring like a key finder um and so if you don't want to wear a watch you just want to use your phone as a dress alarm then the button remotely activates an sos in the event of an emergency so we have like two kind of different solutions there for personal safety interesting okay so that device you just showed me what does that cost so um this one costs um around 200 australian so um for the hardware and then you're looking at beta at around like 15 to 20 dollars a month for the sas and the sim and the the the uh the use of the platform is it 15 a month per watch yes yeah i see and so when you say the cost is 200 is that what you charge to people or that's what it costs you to make no that's what we charge people what does it cost you to make do you make margin there yeah so we um it cost us probably around um the new one that's coming out is a little bit cheaper to make than the previous one we had because we've just changed manufacturers but it cost us probably around um between 60 to 80 australian landed okay well got it so 200 retail 80 cost so you can make 120 bucks per watch sold something like that yeah okay interesting when did you sell your first watch what year uh 2014 20. okay so that was your effective launch date or were you working on coding before that so we um we started the business in 2012 it took probably about 18 months to find a manufacturer design the solution because back then kids wearables just weren't a thing like there was no one doing it um so it took me a while to find someone to manufacture and then we coded the software designed the features designed the hardware put it all together and launched in 2014. wow okay so now you're scaling how many watches are out there in the public now today well so we got thousands out in the public we i mean we've sold thousands over the years um we currently have probably about two and a half to three thousand subscribers um live at the moment um about twenty percent of our business is now business to consumer whereas previously when we started it was all business to consumer whereas now we're more b2b um because we've really moved into more of a reseller market in the last um probably two years so probably about eight percent of our businesses through resellers and the rest is b2c okay a lot to unpack there so let's let me let me do resellers first eighty percent is through resellers so if a reseller sells one of your 200 watches and sells a 15 month subscription what do you pay them in an affiliate cut right so with the resellers we operate a slightly different model um so with the resellers we will sell the watch for them at about um 150 wholesale so we make less you know probably about 70 a watch on the on the watches hold on the reseller price um then they put their own markup on sometimes we will sell at 200 retail because for consumers we try and keep the price down low they might sell it different markets have different pricing um so i guess structures because um they pay slightly different prices but that's that's obviously up to the retailer what they charge for that what about the software the software with the sas um for the resellers they pay around 11 a month um so we still make probably about three four dollars um per month on the sas and then they put their mark up on top of that oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can 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if you go to founderprep.com and hover over products click on get your evaluation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview got it you sell them 11 and they pay you 11 a month for the sass you're making 11 bucks per watch they sell monthly recurring yes oh okay interesting so 2 500 out there today across your value out of resellers plus your direct consumer at 15 bucks a pop right what so you're doing 37 000 bucks a month right now in revenue yeah so we're probably around 30 in revenue at the month um because we've with the phone app it's slightly cheaper because there's no sim card with the phone out so that brings the average monthly revenue um per month down slightly so because the phone app you're only paying like six or seven dollars a month for a retail customer because there's no service and if you're at 30 000 today where were you a year ago do you remember um a year ago um i don't remember a year ago i know probably 2019 because we did an acquisition about a year ago um and that increased them uh mrr but um prior to that we were probably at around um 15 16 we probably doubled um since we did that acquisition okay we first interviewed i don't know if you remember this back in 2018 and you said revenue back then was around 20 000 a month so yeah that's you know that's four years later you've added 10 grand in mrr you know i would say you know that feels like really slow growth why aren't you growing faster um there's been a couple of reasons for us i mean firstly um resources we've always been really small um we we're pretty much um are you bootstrapped yeah pretty much we have had investment like we've definitely had um we've definitely had some good investment but um but it costs a lot obviously to develop the hardware um and unfortunately in australia the networks have been shutting down they'll shut down a network like a 2g network just after we launched and then we had to invest in redoing hardware and now they're shutting down the 3g network so we're having to re-invest in hardware so a lot of our our cash has gone into hardware development um which has really limited our ability to scale australia's quite...