Pulse.io Revenue (2024)

[00:00] Hey, folks. My guest today is Joe Kaul. He's a 25 year old marketing expert owning a marketing agency and an emerging technology in the machine learning AI space called Pulse. Pulse predicts the outcome of creative content before it's published, maximizing return on ad spend for brands and marketing agencies alike. Joe, you ready to take us to the top? [00:17] >> For sure. [00:18] Alright. So I have 10 ad creatives. Who are you publishing them to before I actually launch them on Facebook to see if they're gonna give me a good return? [00:25] >> So what we're doing is we're taking creatives, uploading them through our ML platform, identifying a number of different key factors through the machine learning in terms of hue, saturation, luminance, object identification, and a number of other key factors in terms of the natural language that's used in the written context of text formatting to identify based on petabytes of historical data how people have reacted previously, cross correlate that against how they're likely to react to that piece [00:52] >> of content in the future. The machine learning is now complete. We're at 97% accuracy on the prediction model. [00:59] Mhmm. 90 97 accuracy on what? What are you trying to predict? [01:04] >> On predicting the outcome of emotional responses to creative content. So when someone is publishing a piece of content, are they gonna feel angry about it? Are they gonna feel sad about it, confused, Unhappy? How many people are gonna engage with it? What type of engagement is that likely to be? We can predict that with 97% accuracy now. [01:22] How do you know though? I mean, I scroll a lot of Facebook ads, you know, in in the course of a day that I never interact with, and maybe one makes me angry, but I give no signal to Facebook that I'm angry. I just keep scrolling. How are you able to capture that? [01:32] >> Yeah. Sure. So that's based on a number of other engagement statistics in terms of watch time, in terms of frequency of watch, in terms of frequency of communication around the piece. But fundamentally, we leverage available public data to identify trends of how people have reacted to similar pieces of content. So while you might not react, other people will react in a similar way and possibly more forthcoming with that information. That subsequently gives us the dataset to [01:59] >> identify how people are likely to react. Similar process and identification process to natural language processing, but it's kind of NLP on steroids. [02:09] Mhmm. And and so I understand why brands or agencies wanna pay you for this, but give me a sense of what you like, how you price. What are they paying on average per month to use this tech? [02:18] >> Yeah. It varies. So it depends on how many campaigns they're running simultaneously, but it varies from £500 a month in in British pounds all the way up to however much they wanna be paying. But the range for SaaS subscriptions is 500 to 5,500 a month. [02:33] What's like your sweet spot, though? Know it's sort of weird to force you on average, was $607,100 bucks a month a good average? Around [02:40] >> about 5,500 is probably gonna be the average for the majority of significant sized agencies. If they're smaller sized agencies, they're gonna be going for the £500 a month package. [02:49] Know. But the real question I'm asking is what kind of agencies are using you. Right? So I'm I'm asking what the mix is effectively by asking what the average is. [02:55] >> Sure. At the moment, we're pre rev. But as soon as we hit revenue generation, we know that we have a 100 and so agencies that are gonna be taking the platform on from day one. And of those, they're sort of roughly falling into the 2,000, 2,500 bracket. [03:09] And so how are you learning that? Are you sending a PDF with like made up prices to see how people respond and you've had a good response to a $5,000 price point for large agencies? [03:18] >> So it's based on a number of things. We've not priced it based on what they would want. We priced it based on what we know we can achieve and based on what we know our direct competitors are using. And we're building a technology that's subsequently substantially better than our direct competitors. So we know quite confidently that the agencies that are going to be deploying this sort of solution are gonna be quite satisfied on the price point [03:43] >> side of things. Majority of entry point for similar products like Talkwalker, for example, people are paying $6 a year for a similar product. [03:50] When did you launch the business? What year? [03:54] >> Middle of last year, June 2020. We've been burning through cash quite fast since then. [03:59] How much are you burning? [04:01] >> We've done 1,480,000 pounds so far. [04:05] Okay. And and what why is it so expensive to build this? [04:09] >> Lots of machine learning, lots of computer vision. Predominantly, the the bulk of spend has gone into that. The tech stack that we have behind this has meant that we've had to deploy, some quantum computation elements as well, and a variety of other facets to the product in the back end to handle these vast quantities of data, that that we have. [04:30] Where'd you get 1,700,000, 1,800,000 to burn through? [04:34] >> So a 150,000 has come from private investors. The rest has come from me, and the money that I've accrued over the past however long, by running my marketing agency. [04:44] Oh, very cool. Okay. So you've had significant success then in the marketing agency to be able put a million, 2,000,000 of your own money into the business? [04:50] >> Been okay. Been okay. [04:52] Yeah. No. This is great. Okay. Cool. I love a story like this. So so how do you decide? Do you have partners in the agency? No. Okay. Got it. So it's your own I see. I see. And how do you make money at the agency? Is it people pay to spend a $100 a month for them and you take 10%? [05:08] >> Basically that. Yeah. It depends on what model we're working on. So you've got the paid ad model, but then it's a full service agency. So we do video production, animation photography, creative design branding, the whole the whole suite in one place. [05:21] Mhmm. And and why let other people take equity and put in a 150 k? Why not just put in another 150 k yourself and keep a 100% control? [05:28] >> Strategic. So I'm not gonna say who the investors are, but there are a couple of private investors that we've taken on board who are fundamentally going to help us long term with our our long term vision and plan for what the product can do. [05:41] But fair to say you still own more than 95% of the business? [05:45] >> Yes. At present. [05:46] Close. Close. Oh, okay. You said at present. Are are you raising now? Are you about to announce around? [05:51] >> We may be announcing around at the start of next year. You know, additional capital is always useful, particularly when you're deploying a product like this. It's very complex, requires a lot of funding behind it. Yes, we may be launching another round, but over and above that, we have, you know, option pools and a variety of other facets that are gonna decrease my my equity holding. [06:12] Mhmm. Don't doesn't your ability to avoid dilution drastically decrease the second you go from $0 in revenue to one? And if so, wouldn't you wanna do that before going out and raising another round? [06:23] >> Yeah. So that's that's absolutely the case. So by the time this podcast goes live, I'm assuming it's gonna be January 22 anyway. So, you know, from the point at which we launch the product early next year, you know, we're definitely gonna have a few months of of live phase before we actually implement a new round. [06:44] I see. I see. What's the team look like today? How many people? [06:48] >> 15. A range of full time perm and contractors, basically perm as well. [06:54] Mhmm. Okay. So 15 and how many engineers? [06:58] >> Seven. Seven engineers. [07:00] Seven engineers. And are you all in? Like, if you lose this million bucks you personally put into the business, are you screwed? Like, do you feel the pressure? [07:08] >> I definitely feel the pressure. It's a lot of money to chuck into one project for sure. I'm in a fortunate enough position where the agency is doing well. We have a number of really exciting things happening on that front as well, which will help Pulse subsequently next year. Am I screwed? Hopefully not. Would I, would I prefer it to work? Absolutely. [07:26] Talk to me about the agency. How young were you when you launched that? [07:30] >> So I've been in the space since I was 16. I set up my first agency with a business partner at that point, ran that for three years, wasn't happy with the direction it was going, shut it down. So from the age of 19 through to today, we've been running Onqor. [07:44] Interesting. Okay. So the agency is called Onqor? [07:47] >> Yeah. [07:48] Very cool. [07:49] >> O n q o r. [07:50] And and how many folks are full time there? [07:53] >> 25 at the moment, but scaling very, very, very rapidly next year. [07:58] Interesting. Okay. So 25 full time full time there. And best year in terms of revenue at the agency was about how much? [08:07] >> I am not gonna disclose that at this moment because there's something quite significant happening over there, but I I will gladly share it with you at a later date. [08:16] More more can you share a range? More or less than a million revenue? [08:19] >> More. Yeah. I was gonna say, I think it'll be very fairly easily more than a million. [08:24] Would you sell the agency? [08:26] >> I mean, would people I would imagine people would require you to [08:30] be less connected to the agency if you're gonna about to raise a big round in the SaaS company, and one way to solve that problem might be to just sell the agency? [08:39] >> I'd argue the complete opposite, to be honest with you, by virtue of me being quite well connected in the marketing space and in the agency space. It's actually very beneficial for Pulse. So the more involved I am with the agency, more involved I am with the space in general, the better. And the network that I have over there substantially helps the growth of Pulse. [09:00] So I'm gonna role play. I'm a very strategic person that you wanna bring into your company, and I'm looking at leading your next round. Hey, Joe. You know what? That rationale makes perfect sense to me. You're exactly right. So I need you to bundle the agency with pulse. And if I'm writing you a check, I wanna have a equity stake in both of them. [09:14] >> Again, something significant happening over at the agency side, which will ultimately adjust the way in which I can discuss that. I can't say any more than that. [09:24] The reason I bring this up, this is a trend that, mean, I look, I interview thousands of founders, but I see this happening so frequently where people are, they're brilliant. They build distribution first, which is what I would argue an agency is, right? It's distribution or community first, and then you build a SaaS tool. And then you have to decide, do shut the community down and go on on the SaaS, Or do you let them work [09:41] together? Because you would argue that any customer that your agency touches that also uses Pulse has a higher NDR on Pulse because the agency helped them get set up on Pulse. And managing this story with investors is very tricky because like you wanna keep your media agency separate because that can be kingmaker for the rest of your life. You built it at 19, right? Who knows what will happen with Pulse, but then everyone else is gonna [10:02] want you to build it in together or assign a master licensing agreement or a master referral agreement or something like that. [10:07] >> Yeah, for sure. I mean, again, there are opportunities for [10:14] >> that to make more logical sense. Again, I can't say much. Right this very second, there's something very significant happening in January that's preventing me from saying any more about strategically why I'm doing what I'm doing and how I'm doing it, but there is a very good method behind it and there is method to the methods. [10:30] Yep. Okay. Interesting. Talk to me a little bit about So you have 15 people, seven full time. How many folks? How many customers do you have using Pulse but not paying it, but they're ready to start paying? [10:42] >> None. Again, they have had access to the platform. We have been testing the platform in time be able to access. We have 50 that have access. [10:51] Oh. Oh, wow. [10:52] >> Okay. Yeah. [10:53] That's great. So you can watch how they use it, learn a little bit, guide your engineering team, etcetera. [10:58] >> Yeah. Exactly. [10:59] Very cool. Alright. Anything else you wanna talk about before we wrap up with the famous five? [11:04] >> I'm good. You tell me if you need anything else. [11:07] No. Just wanna make sure I don't wanna I don't wanna miss anything. Alright. So let's do that. Number one, what's your favorite business book? [11:13] >> Favorite business book. Influence Psychology of Persuasion. Not technically a business book, but very applicable to what we do. [11:19] >> Influence psychology of persuasion? [11:21] Yeah. Cool. Number two, is there a CEO you're following or studying? [11:26] >> There is a bit of a rogue one. It's a guy called Joe Binder. He's the CEO of a personal branding agency in The UK, doing an amazing job, support some of the biggest names in the CEO space in The UK. Really cool guy. [11:39] Number three, what's your favorite online tool for building pulse? [11:43] >> Oh, so the tool the question I've got is favorite tool for growing the business. I put people. So technically, an online tool. But over and above that, I think, we use Life Plan, which is great for financial planning. Excellent tool from an online perspective for us. [11:59] >> Life Plan? [12:00] Yep. Okay. Number four, how many hours of sleep do you get every night? [12:06] >> Four to six during the week, four to ten during the weekends depending on what's going on. [12:11] End situation, married, single, kids? [12:14] >> In a relationship, not married, not single. No kids, but two dogs. [12:18] And, Joe, how old are you? [12:20] >> 25. [12:21] >> 25. Last question. [12:23] Something you wish you knew five years ago when you were 20. [12:30] >> Relaxing is not the end of the world. It's probably the most important thing that you can do for yourself and for your mental position to actually progress forward. [12:39] Guys, he launched a media agency at 19, did over $1,000,000 in revenue last year, over 20 people scaling quickly and used the learnings at that agency to go, you know what? We need to build something and systematize something here. Launched pulsetech. He's put over a million bucks of his own capital into this SaaS platform. They've got over 50 people using it today, about to launch pricing, call it in January, at around, call it anywhere from 500 [12:59] to $5,000 a month sorts of contracts. The whole idea of pulsetech is for you to be able to test and predict which ad creatives and combinations will perform before wasting money putting those things live. So return on ad spend should go up if you use Pulse. We will see what happens. Joe, thanks for taking us to the top. [13:14] >> Thanks very much, Nathan. Speak to you soon. [13:18] One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. We call it deal or bust. One founder comes on three hungry buyers. They try and do a deal live and the founder shares back end dashboards, their expenses, their revenue, ARPU CAC, LTV, you name it, they share it and the buyers try and make a deal live. It is fun to watch every Thursday one [13:43] p. M. Central. Additionally, remember these recorded Founder interviews go live. We release them here on YouTube every day at two p. M. Central. To make sure you don't miss any of that, make sure you click the subscribe button below here on YouTube, the big red button and then click the little bell notification to make sure you get notifications when we do go live. I wouldn't want you to miss breaking news in the SaaS world, whether it's [14:04] an acquisition, a big fundraise, a big sale, a big profitability statement or something else. I don't want you to miss it. Additionally, if you want to take this conversation deeper and further, we have by far the largest private Slack community for B2B SaaS founders. You want to get in there. We've probably talked about your tool if you're running a company or your firm if you're investing. You can go in there and quickly search and see what [14:25] people are saying. Sign up for that at nathanlatka.com/slack. In the meantime, I'm hanging out with you here on YouTube. I'll be in the comments for the next thirty minutes. Feel free to let me know what you thought about this episode and if you enjoyed it, click the thumbs up. We get a lot of haters that are mad at how aggressive I am on these shows, I do it so that we can all learn. We have to [14:45] counter those people. We got to push them away. Click the thumbs up below to counter them and know that I appreciate your guys'support. Alright, I'll be in the comments. See you.