How Nudge CEO Paul Teshima grew Nudge to $720K revenue and 2K customers in 2018.

hello everybody my guest today is Paul Toshima he's the CEO and co-founder of nudge day I a relationship intelligence platform that helps businesses find and grow the right relationships to drive revenue he's a successful technology executive who has run services customer success account management support and product management teams as part of a local executive team he helped lead the company from zero to over 100 million revenue then through IPO and a successful acquisition of for nine hundred fifty seven million by Oracle he's a big believer that that culture Trump's strategy every time and that storytelling is an essential part of creating the business he's had a successful track record as a leader with a strong focus on sales and customer engagement Paul are you ready to take us to the top I am thanks Nathan for having me on board today you've been so I love it when someone who like came out of you know taking out what is 0 to 100 million right you were you had the corner office you were doing the big thing you say you know what I'm gonna go and start a little from scratch I'm gonna go back to the full details and the computers that don't have all the specs alone because we're trying to save some cash so tell us about none John AI what's it doing how do you make money so nudged AI we are a relationship telogen platform so what we focus on is tracking the strength of relationships within the business network and finding you ways as a sales person particularly b2b salesperson those relationships to get access to accounts and then ultimately close deals and that's where our focus is what signals are you using to measure to measure strength of relationship so we are using actual communication signals so your email your calendar your phone it's not proxy by social media or connections on LinkedIn it's the fact that you are having a real relationship real interactions with people that's what we measure how is this I mean remember conspire full you know Brad Feld owes invested and then full conduct took it up and then you know Bart just said hey we're setting this thing down it's not working how are you different than conspire I think we're different a couple things first off I think we we're not a I think to conspire was a fully automatic opt-in across the board and so I think a lot of like commercial sales teams were reticent and coming on board so we actually it's an opt-in process to share that information with others on our platform we've about 20,000 users on today and what happens is if you're a b2b sales team and you want to know someone on your board or someone in your customer advocacy has access to a new target account we can tell you and whether it's with a strong relationship or a weak relationship okay I think I understand this let me and let me rephrase this um I am an LPN many venture capital funds I am flying to San Francisco and really want to meet with venture capitalists s I can go put in the managing directors of funds of invest students and try and see which one of them has a connection to venture capital X in San Francisco that's right if you are sharing that with those people from those if they were part of your Universal of nudge users that you share that with I see so good that's what I was gonna ask you are there security issues there so what you're saying is I have to say hey allow you know friend X to have access to my connections and to see who I'm closest with so that they can then ask me for those intros if they want them that's correct and in a business in an actual corporate setting all the people within a team or corporation share automatically and so you automatically get to see you know the head of IT or the chief people officer who they know and then that way as a sales person really can demanding advantage of the real relationships within your network so Paul let me ask you a question so like in my email that same working in a company everyone else in the company has access to like understand my connection so I've connected my LinkedIn with you my inbox with you my chat with you my texts with you on my phone my calls on my phone let's say I have a secret lover that I want to know what he know about how do I make sure that only the texts and the emails from my secret lover never show up to my coworkers well the first thing we never look at the contents of anything that is sent the contents or the of the calendar or the email so we're only gonna know names and we're gonna know the back-and-forth time and date - you can at any time hide someone completely from the system so I'm not saying that that's come up ever before but if you for some reason wanted that you can just hide that person they'll never show up ever again a nudge if you don't look at content of the email though how do I know that my coworker is connected to potential new partner why if you're not reading the emails they sent to potential partner why because there's a lot you can gain 90 percent they're just on the understanding the frequency the balance the type of interaction for example if you have a one-on-one meeting with someone that's gone over the last two years every six to eight weeks or so that's a pretty strong relationship the person is someone you're engaging with on a regular and it's just you and that person if you have a flurry of activity and a whole bunch of back for the emails in one meeting and then it disappears that's not that's that's a sales call that didn't go in further and so it's those types of things we can learn and we today we track about fifty million business relationships about form and so we can sort of we've learned what makes a real relationship and what doesn't interesting so where LinkedIn might show if I visit your profile you know when people search for Paul they also search for a boom boom boom and I'll probably get a list of everyone else that's your company this is an opt-in version of that and it's a much stronger signal because I'm seeing the time and frequency of when you emailed or when you call it or when you did whatever with X or Y other people that's correct in LinkedIn is great don't get me wrong it's a fantastic business network it just doesn't have the strength of connection sharpen and and and today everyone has more connections than ever before Paul you put that you guerrilla or help draw go 200 million of BIOS oh you're topless on a money guy which I love how do you make money on this thing we sell it so we sell if you're a sales professional ahead of sales and you want your team you get access to target accounts through the network you buy a nudge receipt for every sales user in the organization and every other person you want to see their network and then to we plug in the analytics into CRM so that if you want to track how it deals progressing and whether the salesperson is growing the right relationships with the right people you can see that right in CRM and so that's how we make money we charge heads of sales for the put this tool in place and on average I don't to it on every customer cohort cuz we get lost quickly but on average what are people paying per seat per month you know our stress our straight down the middle product is $30 per user per month us okay got it and would you say that it did that has taps your average very accurately I do yeah absolutely okay all right give me more the back story here um when did you leave I assume you left Oakland and went directly into this right we got my Oracle I stayed on for a year to help with the transition and in October 2013 I took two months off and then my co-founder Steve woods and I started much is that a sexy way to say you had to stay at Oracle for a year to get by the earn out we didn't have an ur no none at all I don't believe you there was nothing to help with retention of key employees I mean there was there was additional upside okay there was there's no Reve esting we owned all our shares we could we'll walked away on you know day one after the the acquisition was confirmed got it okay so you left you take a two-month break and then where did you find your co-founder so Steve woods was a co-founder at eloquent as well so I've been working together for almost 18 years now that's good okay I love that so now you guys launched this company I'm gonna guess based off your history you said why would we use our own money when we can probably easily raise it our peoples plan to grow this so how much have you raised so today we've raised just a little over seven million u.s. and we have put some our own money in but it is it is a good way to test the business to see you can go raise money even a second town entrepreneurs it's still a good way to test a business how do you because we have a lot of second how much for ours on all that listen to the show and they always go Nathan you ask questions like this one so Paul when you are on raise additional capital after it is clear and I work in the market noise you just had a big win how do you overcome the obvious which is the investors going Paul why do you need us to give you 7 million bucks use your own you just made a killing I don't think they were guilt come with that objection they actually want to be part of the second one so they're actually looking as an opportunity to de-risk another investment with with entrepreneurs who've done it before I...