How Scapic CEO Sai Krishna grew Scapic to $1.2M revenue and 40 customers in 2018.

hello everybody my guest today is say krishna he's often described as an accidental entrepreneur as an engineering undergrad he built his first startup in the education tech space to power thousands of students to better use tablet pcs since then he's founded invested in mentored startups all through particularly in the technology space he's an alumni of stanford university graduate school of business and the founder of escapic a cloud-based virtual and augmented reality content platform helping businesses and users generate ar and vr experiences without coding the company was part of y combinator startup school and was very recently recognized by facebook as one of india's top vr and ar startups in their school of innovation program so are you ready to take us to the top good to go you bet so first things first people here white combinator or silicon valley i generally assume oh pre-revenue lots of funding do you fall in that category or no right so given that we had to start our journey back in asia particularly in india there is a sense of grounding which is sort of brought in which is business models have to be thought through uh far more before we are able to uh have access to institutional capital given that sk today happens to be a revenue generating startup across the virtual reality and the augmented reality side of the fence and we've had to think of a couple of novel ways in order to productize as well as get out there to the market and start generating those revenues so not on the pre-revenue kool-aid just yet that's good now talk to me about some of these unique things that you did to drive revenue if you can tie into that story maybe do an example of what you guys do for an end customer absolutely so if you've noticed the way we've interacted with devices or computers have always changed every 10 to 12 years there was a guy who wore a black turtleneck took to stage during 2007 called steve jobs who really changed the world but even if you rewind about every decade before that we've gone from desktops mainframes laptops smartphones so on and so forth which means that the ability for us to access computing information has changed and now in that arc we see virtual reality conversational ai and augmented reality to be the next frontier given that position what we're building skating to be is uh to be the simplest editor or the simplest visual interface for brands creative professionals and businesses to build content because the one thing that's going to make you buy a vr headset over any other computing device out there is perhaps the content and similarly for ar as well so we think user generated content is a very important part of this puzzle and we're building the simplest way for those users to generate the content what weebly and wix and squarespace allow people to do in terms of dragging dropping together the websites you're essentially allowing people to do but for vr and ar experiences absolutely interesting uh so what's the revenue model currently it happens to be a freemium sas league and given that our experiences happen to be browser first and not app first imagine over a period of time clicking on a banner ad opens up an augmented reality application or going through uh scrolling by your news feed is able to enable through rich immersive content and we think the internet will move there where from an era of interactive content or multimedia centric content we will move to immersive content which is 360 3d vr and ar centric given that we are a freemium sas play in that with a licensing fee that ranges between 20 to 200 each month and what would i get for 20 bucks a month 20 bucks a month would give you access to an editor which is similar to your wix wordpress questions what makes it compelling is these content pieces are distributed across social media your own web your own websites as well as advertising networks over a period of time and here the roi which is customer engagement the number of eyeballs which are drawn to it and the amount of time they spend on this content is significantly higher than what a traditional piece of media such as a photo or video is able to bring to the table interesting when did you launch the company this uh we got started with kpik at about january of 2017. okay and since then we got we had the first version of our product out at uh about july okay very good and then over the first i guess it's just been kind of 12 18 months how many customers have you scaled to right so today we serve more than 40 customers across brands and in large enterprises these include customers such as airbus viacom sony and the likes of which given this we've been we sort of have optimism that vr slash ar is not more like a party trick but it is something that is going to be of meaningful value addition over a prolonged period of time how many are on the free so 40 are paying how many have tried it the once we've tried it out is from a consumer side we're close to 100 000 users at this point oh wow interesting um are you has anything surprised you about usage patterns that's affected your future roadmap social media marketing the one thing that we didn't quite anticipate is the amount that the tool would be used specifically for ensuring that content pieces in social media networks particularly across facebook instagram messenger are going to be ones that are 3d based 360 based or the likes of which now that that sort of took us a little by surprise because we were thinking that the market is going to point us towards directions of education training standard operating procedures and deep enterprises in some of their use cases but there's been a little bit of a realization curve there which is tools of simplicity perhaps are as important for a marketer as much as it is for a business sure oh and you see a lot of times basically the thesis you just described you know consumer things that become very popular eventually you become adopted by enterprise right and so potentially that still happens which will be interesting um just to kind of put some ranges on this though so you mentioned 20 to 20 20 bucks a month 40 customers that puts you about kind of 800 bucks a month so you're just kind of getting things going is that is that accurate not quite so the 40 customers that i just described to you are enterprise customers who pay close to 200 per person per in the team and bc's are typically about 20 to 30 members strong which means that the the revenues that we generate are significantly towards the six digit mark and uh inching towards 17. yeah have you have you i was going to say so from our revenue perspective i mean have you when you break a million a month do you think that happens this year or next year or 2020 uh a million a month i think would be towards end 2019 at this point we are slated towards trying to achieve that out of the 2020. i'm really glad i asked that follow-up question by the way because that would be you know eight grand a month would be very different than so just to be clear the math looks much more like 200 bucks per seat times 30 team members right six grand a month across maybe about 40 enterprise applications that puts you much closer to maybe 240 grand a month with eyes at a million a month maybe late 2019. that that's the plan is that fear the plan that we're running on very good and help me understand a little bit say more about growth so if you're at around that 240 mark today where were you about a year ago um about a year ago we didn't exist okay so you work for revenue yeah we repeat that video about even about a year ago walk me through the story how you got your first enterprise customer the first one was an interesting one at that which was we were right out of uh startup school and roughly around then we had we were uh given an open innovation program or the application to which from one of europe's largest automobile leasing divisions and what we really wanted through was an easy way in order to have a fleet of 200 000 cars and an ability in order to look at them by an augmented reality layer and annotate them through and at some point things hit a glass ceiling purely because uh an automobile company or the holding company which happens to be a bank are not necessarily experts in the virtual of the augmented reality space which means more often than not these companies take too long it things cost too much they don't have the right teams and the efficiency takes a hit and that's really where we were able to jump in and try to paint the story around the numbers rather than the technology and that seemed to stick which was very quickly we realized that the part of vr and er resonates with the technology world but right outside to some of the industries that we operate in what perhaps makes more sense is the math and not the technology in itself and the value can be derived from the technology so we were able to completely stitch together the conversation around numbers and how we would have a positive net impact on a team as well as a fleet of cars and that i think at some level had them to write and has you mentioned you're kind of shifting your model a bit more or it surprised you how people are using this more for social media so moving forward in terms of growth channels what channels are proving to be most effective for you nathan uh my apologies could you hit me on that one no problem that story about the car manufacturer in europe right out of y combinator is a good one but you mentioned you've pivoted a bit as well in terms of surprises from your use your users so what is the growth where where what are the growth channels today working well...