00:22:02 · Carles Reina
[00:22:02] S0: the form of commission and, like, sales cycles and expectations and quota, we didn't actually split it by industry or by, like, vertical or even by market. Right? And I think that was a mistake. When I look at it, like, from today, it's like looking back, like, it was a mistake because, like, the team members were only incentivized of actually going and selling to the developer ecosystem, like going and selling to like those like markets that actually were moving much quicker. No one was really incentivized into going and selling like properly into the banking space, the insurance, like the telcos, the utilities, the healthcare providers, so on. Right? So what we ended up doing is like classifying, like, we ended up doing a segmentation, SMBs, mid market, like, oh, SMBs incorporate, mid market, enterprise and strategic. The strategic team members had like a complete different setup. Right? So if you're trying to sell to a very large corporation above 10,000 employees, hey, we need to find a way because you're not gonna be able to actually sign a contract. I wish you were able to sign a contract in six months or in three months. Yeah. That'd be fantastic. But the reality is, like, it's gonna take longer. Right? So, like, we will incentivize you and we'll guarantee some level of commissions so that, like, you're able to start doing that. Right? So that was one end. And also, like, we will expand it and make sure that, like, we put incentives and all that stuff. But we did it much later and something that we should have done early on. And then, you know, like, sellers, like, we are sellers in nature. Right? Like, we wanna go to whatever it's easiest to actually, like, get your commission. So I think, like, it makes sense. Like, if the incentive is, like, equally spread across all the different industries, then you will go to the place that actually you can make the highest amount of money, like, the quickest possible. Hence, like, we were not properly incentivizing those verticals. Of course, that changed a year ago and then we started having a lot of crazy success in some of those complex industries, as we call it. But some of the markets also matured quicker.
00:23:50 · Carles Reina, Guillaume Moubeche
So as a business, if I had to start doing it again today, I would segment it in in building centers based on, like, in the market, on the industry tackling, what is a higher priority versus a lower priority, and essentially, like, de incentivize some sort of products as well. It is much more complex selling an agent's product versus, like, selling a single API endpoint. So there is some of these things that actually need to like craft it into the entire compensation plans. [00:24:13] S1: Before like talking about your fund strategy and the the investments you've made, I'm curious to like touch base on everything that's happening right now in AI. Like, we're seeing, you know, the rise, obviously, I mean, we've seen the rise of Anthropic, OpenAI as, like, closed source models. And we're seeing also that open source, all the Chinese models are getting, like, better and better. We're seeing, you know, like, Hugging Face, like, being acquired by NVIDIA. I mean, there are a lot of things, like, happening. What's your view, like, for ElevenLabs versus, you know, like, all those open source and kind of competitors in some way that can pop up like over the years? Like what's the technical, like strategy do you think you guys have been able to develop that is very hard for other people to catch up on?
00:25:01 · Carles Reina
[00:25:01] S0: I think like the market is saturated with like models, right, across the board. Like, whether that is like text LLM, that is video, that is image, that is like audio, voice music, whatever you wanted. I think like what we ended up doing at ElevenLabs was like, let's try to play the card of like the best research for audio technology. Right? Like, let's always have the best models out there in the market and so on. Now, of course, like you end up like the moment you do it and you go this quickly and you go this quickly, it pays like a lot of people pay different attention points and end up having like competitors pop up left and right. Some of them using... Were using our own API endpoint and claiming it was their own technology. Some other ones building like on top of open source. Some other ones like building proprietary research, all of that stuff. Right? And I think the core element was like always the same, which is like, let's build foundational models, the best in the market, and then let's build products on top of the foundational models that we're able to actually keep, like, keep just going to the market and providing customers like the best research and the best product together. So we pay a lot of attention on the Chinese model because they are absolutely amazing. Everyone like from a tech generation to video generation and so on. And you can see like video generation, the Chinese models are the best ones in the world right now. Right? No. Like, I mean, see that it's like absolutely amazing. What is the downside? The downside is if you're selling to large companies in The US and those companies might have a contract with the US government, the reality is like you cannot implement open source models. And a lot of like what the media publicly like forgets about it, and everyone... I know like the buzz is like, oh, those Chinese models are amazing. And they are. But if you truly have big American customers, you cannot use open source models from China. And, like, people don't fully understand that because, like, it's something, like, not that many people talk about, but that's the reality. So even today when, like, do you think about building agents? You're like, oh, let's use a quen model. Amazing product. Like, an absolutely amazing product. One of the best one for, like, like, low latency, like, real time conversation and so on.
00:26:59 · Carles Reina
But the reality is, like, you're not gonna be able to use it. You do it for demos. So, like, you feel that... Like, everyone feels like this technology is amazing. It works really fast. Like, there is no latency. All... Per a practical level, when you take it to a company, you no longer can use a coin. Right? So, like, there is a lot of these things that, like, when you scratch a little bit the surface, you realize, like, yes, amazing foundational models that, like, Chinese have, but at a practical level, they're just not, like, to the point that you can embed in your product and get specifically US customers start using it, or European companies that have a lot of, like, US operations to start using it. Right? So there's some of these things on the politics side that actually, like, are not ideal, that essentially are being much more favorable to, like, US companies right now just because of the structure of everything it is. Whereas in Europe, like, can still use Mistral or you can use, like, any variation of it. And depends on the company. Like, they will tell you that, yeah, open source Chinese models. What is it hosted? Are you connecting to the API endpoint or are you hosting it yourself? What is that hosting? Is it like in Europe or is it somewhere else? So you end up answering a bunch of questions on maybe some of the big companies are also using open source Chinese models if they don't have US operations. Right? So there is some of that stuff, like there's variations on which market you operate in.
00:28:15 · Guillaume Moubeche, Carles Reina
[00:28:15] S1: I think for Europe, it's gonna be a good test for Chinese and Chinese like open source model because in The US, I mean, it's obvious that there is the open competition kind of like the global business war, etcetera, while Europe, you know, is a bit in the middle. And I don't think, like, Europeans have the same view on Chinese model as The US have, like, for many, and and I think it's gonna be interesting to see, like, how great, you know, like, some models are getting, to what point, to what extent can they be used and and see how how it's evolved. For you, like, whenever you see people [00:28:51] S0: talking about... Correct. To me, like, it reminds me a lot to, like, the Chinese vehicles, the Chinese cars. Like, there's a very interesting comparison. Like, in The US, you can still not sell Chinese vehicles Yeah. For a number of restrictions in there. But in Europe, like, we kinda embraced it. And then, like, in many European countries, like, you see mostly Chinese vehicles out there, and then look at the, like, European manufacturers that are all struggling. I'm not saying, like, it is right or wrong. I'm saying, like, it's a completely different approach, and usually Europe is like a testing ground for, like, what the Chinese companies are able to do later on in The US once the market clears up. Right?
00:29:24 · Guillaume Moubeche
[00:29:24] S1: Yeah. And the funny part is, like, if you look at at The US economy, and I think people forget it a lot, but if you look at the iPhones, Nike products, like most of the American brands, whether it's electronic or, you know, like clothes, fashion, etcetera, at some point, it's been produced in China, you know, like... So I think for a long time, underestimated Chinese, and they were saying, like, okay, they can only copy, they can't innovate, etcetera. But for me, it's like... It seems that everything has been shifting, and for Europe, it's a bit sad also, like when you look at the manufacturing capabilities and when it comes to cars, and this was a big industry back in the days, but after moving like all the facilities, like in Asia, etcetera, etcetera, like, now we we have, I don't know, maybe like twenty years delay on on everything. 100%.