How Srax CEO Christopher Miglino grew Srax to $26M revenue and 500 customers in 2019.

hello everyone my guest today is christopher mcglinnow he's the ceo and founder of shraxx he spent the last past 20 years working in digital advertising space and has successfully launched and sold two internet companies both these companies were sold to publicly traded companies on the nasdaq his detailed understanding of how technology interacts with brands again now building this one allowing consumers to control personal data christopher you ready to take us to the top i am all right so this is obviously a very hot kind of controversial topic right now what does shracks do when what's your revenue model how do you make money so our core business is in aggregating data around different verticals so over the last 10 years we've been aggregating data around uh different core verticals and most recently we've launched over the last couple years a platform that will allow consumers to own and monetize their own data because we you know we understand what uh what data we're buying in the marketplace we understand how the consumer is being taken advantage of in the marketplace so we launched a platform that lets consumers own their own information and then get compensated for sharing that data okay so you are you exclusively b2c or are you selling to any are you selling this data rolling it up and anonymizing it and doing any b2b stuff we are doing b2b so what we do is we'll we'll take the business to consumer data put them into what are a lot of people don't understand how the data business works data comes into what are called segments in the digital advertising space segments are uh different pieces of data about how the consumer is seen so you have you know you're a male you are a certain age you make a certain amount of money you shop certain places every time you use your credit card every time you uh go into a certain location with your phone that drops you into different segments those segments are then sold back to marketers that are looking to reach those types of consumers so we've created that infrastructure for that allows that to happen so you're paying consumers right they're not paying you correct consumers we pay consumers historically what's happened is we have uh we buy data from the big data sellers so companies like experian and oracle and uh facebook all sell access to certain amounts of data okay so we take that information uh instead of paying those providers for that we pay it to we pay it directly to the consumer um say that one more time you pay for data from experian and facebook and do what with that data well no historically what we've done has we've bought data from aggregators of data so experian oracle axiom these are all people that consolidate a bunch of different data together and sell it to marketers now the consumer doesn't get compensated for any of that so the challenge and nor do they even understand that their data is being sold in so many different ways you know they they don't know that when they go and shop at a certain store that stores them reselling their data yeah so chris sorry i think i get it now just be clear historically your model has been you spend money to buy data from facebook experian axiom you then sell that to marketers your new product basically removes you having to pay those guys maybe you still do but you now actually will pay consumers directly for their data so you are becoming a axiom facebooker experian right with consumer opted in consent so the challenge that all those other pla those players face is that the consumer doesn't really understand what they're getting into in that relationship whereas in our platform they fully understand the relationship they fully understand that they're putting their data in the platform in order to be monetized and protected okay so you pitch me on this nathan sign up for our consumer thing what date am i gonna give you and what will you pay me for that so you're gonna give us all your basic demographic information when you sign up so you're gonna say okay uh this is my basic uh address my email address my phone number uh and then as you get into the application the application starts to ask you more questions based on things that we think you might be interested so it'll track where you're going and it'll say oh yesterday did you go to hugo boss or did you go to nike and you'll say oh yeah i did go to nike and then i'll say okay what did you buy a nike did you buy something at nike and then it'll ask you a variety of different questions like that one of the things christopher sorry are these actual questions in like a web form or am i installing like a shrek's app on my phone and you're automatically able to capture this data after i told you you can automatically capture it both it's a combination of both of those things so you're we're you're installing an app and there's a desktop version of this as well and then you uh you are answering questions inside the application as we're tracking your location and you've consented to that location tracking consumers don't understand that google and everybody else is tracking location data and showing that back into the market so what do i get paid for this what do you pay me for it so i've been on the application for around two and a half months i've made around 850 bucks in in the app but i'm obviously i'm pretty active in in the application but uh consumers are paid not only for their uh own data but they're paid for data of anybody that you bring into the platform as well so it's like if facebook would have said to you 12 years ago 15 years ago what's the average you're a power user what's the what's the average consumer is what making like 50 60 bucks a month from europe your platform yeah that's a that's that's around a good number of uh of what people are making and the good part is you don't need to continue to participate if you want to just be a consumer that downloads it once put your information in never touches it again then you're still earning money as time goes on how many consumers have opted in so far we haven't given those numbers out we pl we're a public company and so we're uh giving those numbers out in our first uh first quarter quarter earnings call which is coming up on may 15th ignore the actual as well i mean what's the tar i'm sure you put out targets for this right are you talking about like a million people or a thousand or you know our goals our first goal is half a million people uh and then because we think we can start to monetize after a half a million people we we had a we had a platform that we sold last year for 52 million dollars that had around four uh hundred thousand uh doctors in it why did you what was the platform and why did you sell it so it's focused around uh the pharmaceutical industry and uh aggregating doctors that were uh prescribing certain types of drugs it didn't fit the model of paying doctors for their data because that's illegal so you're not allowed to pay doctors for their information or for their attention span which you can do with consumers so doctors are under a lot more scrutiny in that area so it didn't really fit plus it was a great exit for us you know we started that from zero and we got oh you didn't acquire that much at a much smaller stage you actually launched that from nothing yeah we launched it from nothing like our other verticals we have we have a vertical around investors we have a vertical um that's around auto we have one that's around shopper that's been our biggest vertical and then we have one that's just a core so those are all natively grown inside the company so separate and apart from what you are and i are talking about those are other pieces of the business that we do so how much time do you think you need you just launched this two months ago how much time do you think you need your first 500 000 consumers signed up um we went through you know it's it's been like a uh learning process of changing things in the application so we went through the alpha went through the beta we discovered that we need to change some things ux ui so those things are happening right now once we're once we're done with that we think that uh you know we're ready for the full marketing blast around and there's a bunch of different partnerships that are b2b partnerships that are happening so you our b2b partnerships are uh you are a brand with a bunch of names you had a little box at the bottom corner that said yes you can market to me right but it wasn't consensual for the consumer they don't understand that you're actually taking their data and marketing backing out to you in the future we're revalidating that information partnering with brands and saying look let's pay your consumers that are in your crm and turn what was a cost center for you where you're needing to pen data from experian and all these other players into your data set and turn it into a revenue generating stream so chris for true or false gdpr is actually a blessing for you because when people see the things across the bottom websites that said accept cookies and everyone clicks accept right you're essentially actually legally getting the right now to do this where in the past people would try and hide it you actually love gdpr yeah it's fantastic for us and there's a you know and and for those people that don't know the gdpr is the uh the european um privacy laws and the uh those laws are coming to america in a big way it's a very political issue obviously because people are using facebook to win elections and this is a you know something that's uh we're very active and guide the litigation and not the litigation but um you know the bills that...