Wochit Revenue & Funding (2024)

hello everyone my guest today is jor ginsberg he's the co-founder and ceo of watch it he's also a pioneer in automated video creation developing the platform to help brands and publishers produce short form video content at the scale and speed needy needed for today's video first mobile audiences draw are you ready to take us to the top absolutely all right tell us yeah you bet tell us about watch it so uh what's it do and then what's your revenue model so watch it as a video creation platform in the cloud helps anyone who wants to tell a story to make it quick and easy it's a combination of i would say three elements very quickly it's automation we automate some of the process that said uh it's not about complete automation because it's about video storytelling but there's a lot that you can automate such as i know you have a 16x9 video and you want to turn it into square that's something that we automatically do but clearly lots of lots of stuff on there um creative tools which are needed meant for non-videographers to produce amazing results but without any prior knowledge and last but not least is is content raw content when you want to tell the story you need to have the raw footage uh so we you know teamed up with the likes of kitty and afp and reuters and ap and then and so many others to have basically sold two problems one we cleared the licensing on all the content being used on a platform and then we cleared the redistribution right so you can put the assembled video on here in a way but we basically get all of our content and makes it accessible to our clients you put all these togethers automation creative control content into one platform basically enables you to turn a story into a video within about 10 minutes and are you working mainly with enterprise brands doing this at scale or like or like vloggers and lifestyle kind of creators yeah i would say top down mostly with a big with the big guys okay so i mean give me a sense on average and what's an average customer paying you per month for this oh you know it varies it varies but uh um i don't want to get into specific pricing because really it made you know differs from one client to another yeah i'm just talking about i'm gonna draw i'm just talking about an average i mean are we talking a grand a month a hundred thousand a month ten grand a month um it varies uh it could be first of all it depends eventually on volume uh and usually our clients commit to a certain volume of production so it could be that they pay on an annual basis anywhere from 50 grand but it can go up to uh close to a million okay it's fair to say though your minimum generally speaking is around 50 grand more or less okay and what does that get what are people committing to in terms of how much video they're producing for that amount of money very much differs uh you know we work with both publishers and brands usually publishers need more volume uh brands or agencies if they essentially would require less volume uh although you know the use cases are completely different one of them is a bit more editorial the other one is a little bit more for content marketing purposes yep how are you measuring volume though is it like number of minutes or is it size of file or what but just based on on a per piece basis so to speak usually again usually the content being created on our platform is short form it's anywhere between 30 seconds to three minutes uh so we don't get into the we don't get you know nitty gritty and uh on the details on on if these are in 60 seconds or 65 it's just on a product i'm just curious what you measure your utility metric around right is it number of videos created is it storage space what is it right the number of stock videos number of videos created okay number of videos created great and these are these are typically again and are more enterprise folks top down approach tell me more about the back story here when did you launch the company we launched the company in 2012. okay yeah 2012 uh started you know with a with a uh with an idea originally and we built a product and then we wanted to see so to speak if the dogs need to talk but we started basically bootstrapping it creating um content ourselves and syndicating it out there just to see how it works it did pretty much work very well and very soon after we started basically opened up the platform for our clients to use it on so to speak on a sas basis as i said we sell it on a volume of production basis but essentially it's very close to a sas business uh and then moved on to publishers and later on we started marketing the platform or similar platform to uh agencies and brands okay so 2012 was a launch date and now have you still bootstrapped or if you raise capital uh no we've raised capital basically from day one uh it wasn't um for me my co-founder wasn't the first company so we had some of our own cash so we put some of our own cash but did get you know a first million from uh from a seed investor okay you half kind of smile when you say that why oh no no that's like um not only not anything in specific but we did eventually you know okay good so so so you rate now you put some on your own money and you got a million from a c now is that all you raised today or have you raised additional capital no no we've raised uh we had a few rounds ever since we've raised a total of 29. okay so far that's what i was looking at so so raise a total of 29 total not including the founders money correct okay got it so 29 29 million raised um launched in 2012. okay so tell me more about the team size uh a group of about 60. uh the r d is based out of israel tel aviv uh where i'm right now and we have our headquarters actually in new york city okay uh where most of our you know marketing sales and customer success teams are and we have a similar size team in uh europe actually in london um covering the mia and the asia-pacific regions and what is the the team in terms of the breakdown are you guys leveraging an inside sales team of drive swings enterprise deals what portion of the team are sales versus engineering versus something else so as i said the tel aviv team is about half the size of the company um it's a most most of our dealer not necessarily inside sales most of it is direct actually um clearly you know some of the clients who we have usually fortunately we have more leads than we can take so clearly some of them remain within so to speak the inside says uh realm uh that said as i said we started the business top down uh eventually so you know working with the big brands or publishing breads originally so these usually require some reach out george just to be clear though you said that the team is in tel aviv but i don't know what function they are is that your engineering team is in tel aviv yeah engineering is in tel aviv yeah okay engineering television the rest kind of spread out good and then before we tell before we kind of jump in more kind of to the story and maybe some customer stories uh what have you scaled to today so how many customers are you working with hundreds hundred okay hundreds hundreds and it's all enterprise clients clearly got it all enterprise i mean look so so hundreds at a minimum fifty thousand dollar acv we can kinda back into a minimum you know ar runway you guys are north of five million at this point right way more than way more than that north of 10 i won't ask another one after that but north of 10. okay what year do you think you break 30 in oh we're not so far away i was going to say come on this that's when you call up and you say nathan we're going to break it this year and this is the year when i say not so far away it could be that it could it could be this year okay very good so tell me tell me more draw about how you how you landed some of these enterprise clients first off did you have prior relationships with these enterprise folks from previous companies so uh not necessarily but uh some of the content providers we've worked with i had in you know relationship with my previous startup which was acquired uh seven years ago uh so that clearly helped but these are more partnerships rather than than clients um regarding some clients i can give you maybe one example yes directly related to your question now one of our biggest clients is ganette uh you know the owner of usa today and probably 140 other properties across the u.s i think that what was um what was very unique about their kind of relationship we built with them um is that even though they're pretty big uh they were i would say we were lucky enough and they were smart enough to try us early on okay uh and they and they literally helped us you know more for product into something of a much better product market fit um and it's in it you know on one hand it was very courageous so to speak and very uh we were completely uh uh amazed by how much they were willing to uh to on on a product that was you know early days but eventually um they have contributed a lot for themselves from the whole process but we contributed for the whole industry again making our product a much better uh fit for the market we're in did you let them invest no they never invested although by the way other clients of ours did invest such as proseben or sph and others which are clients of ours and they've invested later on uh there were discussions around that but they didn't mature so how did that relationship with gannett kick off um that's actually a funny story um we met we met in person with her back then i think it was the chief digital officer if i'm not mistaken or something like that and and we gave them a quick show of the platform you know a quick demo and he was he was really smart he said you know what um let's let's do a competition internally between a couple of teams let's give them um a story to create a video on we'll give one team the traditional way they do it and we give another team uh the watch it platform and let's see what the results are and how how how does it look like and how much time do they spend and we literally did a competition inside the company and it was really really funny because you know the other guys didn't even make it to create or to begin creating a video and the other ones the other team using watch it was already publishing it and that was a you know a very good use case and and clearly intrigued the teams uh to dig much more into it and that's that's actually how it started and then i think i never told this story before but that's that's how it happened and that was back when early 2012 2013 2013 i believe yeah okay very good and give me a sense of what the company i mean the video is obviously hot right so i'm curious your growth rate does your growth rate kind of also mimicking the popularity of video oh absolutely absolutely okay so i mean are you more than great i mean you're going more than 100 of you every year i'll run 100 around there got it what so do you have an offering yet for for like kind of the vloggers of the world the smbs of the world or no you it's really just enterprise it's mostly enterprise i say every once in a while there's something like that but we do not put a lot of focus on on the community of uh so to speak the longer tail uh it's mostly enterprise yeah this is i mean this is i talk to thousands and thousands of people that are not enterprise where this is a major pain point and the current solution is go on fiverr right pay find someone that is video editing go find someone who does infographics and then get the you know submit the audio file to rev to get the srtp file to put the subtitles on right and then all that together you know a thousand dollars later for a minute long video you publish it yeah it's it's a hard and long process by the way you know speaking about the longer tale i don't think that i actually think that there is an opportunity there but it's just a matter of uh of where you focus your effort and resources yeah and clearly and clearly you know when you go you don't go down the down the food chain to vloggers and individuals the whole you know marketing and the whole you know operational uh way that you run the companies is completely different do you know someone serving that market right now that's kind of comparable to you or no um i know about a couple of companies which were serving smbs for marketing videos um like like you know magisto or animoto those kind of companies you probably know or slightly the product called promo but slightly there are a few i think that they're it's it's very different because when you target smbs you need to provide them with a tool that is that simple so that they can actually use it yeah which means by that simple means that your ability to build something which is literally on your brand is close to zero so it's mostly based on templates as opposed to something which is completely branded very unique identifiable that you know goes along with your brand tell me about your churn chern's obviously critical in a sas business um i can also only tell you that we have what is called the negative churn which means eventually we we grow like it's it's uh we not only do we keep our clients we have expansions yeah yeah but if you just look at if you look at gross revenue churn i mean what are you losing five percent a month ten percent i'm sorry a year or ten percent a year or what no i'm saying we have negative churn like plus yeah but you can't you can't have you can't have gross negative right so gross is obviously yeah yeah i'm just curious obviously you make up more than what you lose that's how you get to net negative but i'm curious are you losing one percent five percent ten percent below one but below okay means that's very so it's easy for you to have net negative you have to just add more than expand more than one or two percent you're good to go what are people when they are choosing to expand what what is the reason they're expanding is it just they're using more volume the team using your tools getting bigger they want more product features what is it most in most cases they they expand very horizontally so let's say different teams start to use the platform um so you find yourself in in a situation where either they have multiple brands uh you know it's it's a big enterprise it has multiple brands one brand started using the platform that it boosts to other brands or it moves from an editorial team to a social marketing team uh so we see a lot of expansions which is mostly horizontal but regardless of what team's using it your pricing is not around seats or a number of teams using it it's just number of pieces of video content created correct got it interesting why haven't you i mean are you considering adding different pricing axes like team size or things like that or no uh we do in a while there's a there's um there's something about the simplicity of our model uh that is is very is very unique you know because eventually you know a simple pricing model goes a long way and when you try to add accesses and criterias and and other stuff it makes things more complex and makes your clients think more when they want to expand when they want to make a decision so some of the simplicity hides a lot of complexity behind it again assuming the math works right like the math has to work at the end of the day but if it does simplicity goes a long way yep as a funded kind of sas entrepreneur how risky or how aggressive are you willing to be with payback period how long are you willing to wait to get your money back um it's less it's less about risk for us at the moment because we can clearly see it or we can clearly calculate it we can clearly see how it looks like calculate what payback payback cap yeah so it's today um fortunately it's uh it's it's less risky for us i see the return pretty fast okay like less than six months would you say yeah yeah okay and so so just to be clear if you're first your acb is 50 grand less than six months means you're spending less than 20 25 grand to acquire these guys um where are you spending the money when you spend it is it most of the inside sales team um no no as i said that the inside sale is pretty is pretty small we have as i said that we have direct sales which uh is a pretty significant spend um and clearly marketing you know and uh we did a lot on content marketing this year and uh how many on your team how many on your team is 60 are focused on content oh you know we i'm not only counting my team because i also hire you know from the outside so we have some contractors doing some work for us and some agencies doing some work for us so it's a little bit more than just the internal team got it so you're finding keywords seo keywords writing posts around those keywords and getting inbound um i would say it's mostly about publishing our own content it's it's literally content marketing that we do uh whether it's you know publishing articles and and putting out some research and uh how do eyeballs find that content though it gets distributed so we don't spend uh truly we don't spend a lot on on media uh very very little i know that others may find this very attractive for them but we found that first of all you know when you do good research you find houses that want to publish it because it's serious research it's not just uh you know a boring article it's real data that people want to publish uh so lots of news and lots of good stuff that we're writing out uh for example let's just maybe just give you one one example we had a focus on social video uh in the past uh year or so and and people just don't get it so we've read we've written a whole paperwork on how to optimize your social video and eventually you know we're becoming uh to our clients um not not just you know a video platform to create videos but we're coming strategic advisors of how to how to do video how to be successful in video so when if you can put that down to a paper and let people you know uh read it um you would be amazed of how many you know downloads and and and you know and form fills you get from from such a such such a piece of content so honestly and very luckily today as i said we have more leads than we can take that's good draw our last economics question here before we wrap up with the famous five when you start looking at lifetime value it's obviously very difficult and you can argue it all kinds of different ways but at a minimum what do you assume lifetime value is for you on these enterprise clients well as i said it varies a lot it varies a lot because we have um we have as i said we have clients that are close to one million a year yeah uh so i just say minimum 300 yeah yeah yeah that's what it seems seems about i mean if people are paying 50 the first year and then they're expanding additional teams horizontally i'm sure you have a bunch that are paying that i've already paid you more than many millions but a minimum 300 sounds about right very cool all right let's wrap up here with the famous five drawer number one what's the last business book that you read so first of all i almost don't read i listen uh audio books are my favorites um i can't recall the last one by i can recall the the one who made most impact on me that was a long time ago and that was a book called crossing the chasm yep jeffrey moore right yeah i believe so um i think that that that is one of the business books who left most impact on me number two is there a ceo you're following or studying right now so here again i will stay with some old school stuff um first of all you know everybody would say elon musk right is amazing and uh but um i i guess you it's old school but you probably read the book by jack welsh or on jack welch back then again i think it's uh it's definitely uh a masterpiece number three what's your favorite online tool for building a business besides your own i love canva yeah yeah let's get on number one you know by the way i was about to say by the way i mean i could see some synergies between what they do and what you do would you ever well would they ever acquire you or do you ever require them is there a merger in the works first of all they did such a great round of financing recently i'm not sure i can buy them anymore that's why that's why i switched the question a little bit uh i think um uh first of all i think that what they did is can i say amazing yeah yeah amazing it's amazing and what about what they did specifically i think they've nailed the nailed the thing on its head like uh you know making it possible for people to create amazingly good stuff without knowing nothing almost on on what they do uh and that's and that's brilliant i think we're basically doing something very similar in nature like we're doing the same for video i think that i i would uh gently say that i think that on doing it on video is a little bit more complex but that said i think they did a brilliant job all right very good number number four how many hours i'll sleep to eat every night still around six that's pretty good and which situation married single you have kids married plus four married and four kids holy mackerel all right and how old are you jor i'm 46 46 last question what do you wish your 20 year old self knew um first of all you know when when when you're 20 something um i've learned that no matter what you tell a 20 year old eyes he has to go through it in order to understand it so you can tell him whatever you want it doesn't it's not going to help but i would say generally speaking you know less arrogance listening more is uh is always good but when you're 20 if somebody says something like that you don't even listen guys there you have it from jory wishes he was maybe less arrogant and listened a little bit more but look he's having building a lot of success how to exit then in 2012 jumped into a company called watch it got a good partnership going with gannett a little internal competition at ganette proved that there was definitely opportunity for him to scale this product since then he's raised 29 million bucks again helping enterprise brands over 200 of them scale their video content and video production across many of their horizontal teams average first year acv about 50 grand lifetime value minimum 300 grand but many clients paying way more than that payback period super healthy at less than six months with our team of 60 based between israel new york city and london thank you for taking us to the top thank you so much