Venture Europe: Entrepreneurship | Technology | Venture Capital | Eu/Acc
00:29:24 · Chaz Englander, Calin Fabri
I think that really relates to Steve relates that and I think he has been incredibly helpful to the business, both in terms of as a customer and also now as a shareholder. [00:29:35] S0: Also, like some of the questions, I mean, if you can answer them, maybe some of them are not yet public, but what's an example of one or two larger clients? Like what's the size, scale today and at full ramp for some of those larger implementations?
00:29:35 · Calin Fabri, Chaz Englander
[00:29:35] S0: Also, like some of the questions, I mean, if you can answer them, maybe some of them are not yet public, but what's an example of one or two larger clients? Like what's the size, scale today and at full ramp for some of those larger implementations? [00:29:52] S1: Every time I answer this, I get it wrong based on who we've got permission from. I always point the audience in the direction of our website. I think it's like pretty obvious from there. Look, we're live now in production with eight out of the top 10 European banks by way of example, three out of four of the big four, similar names and numbers now in The US, you know, three or four of the, you know, best banks, bulge bracket and boutique advisors. Some of the most famous Tier one asset managers, you know, both APAC through to Europe, US. And we're pretty evenly split for now across consulting, asset management and banking. How that skews over time, I'm not sure. I mean, I think it will skew where the headcount is, which typically will mean that asset management will probably be slightly lighter by way of, you know, actual revenue. But that's on the basis that we're a seat based model or a usage based model. I think these systems over time may move towards an outcome based model, which actually you probably end up making more money from the larger asset managers. In other words, almost pricing on an AUM basis if I fast forward these systems sort of eighteen months out.
00:29:52 · Chaz Englander, Calin Fabri
[00:29:52] S1: Every time I answer this, I get it wrong based on who we've got permission from. I always point the audience in the direction of our website. I think it's like pretty obvious from there. Look, we're live now in production with eight out of the top 10 European banks by way of example, three out of four of the big four, similar names and numbers now in The US, you know, three or four of the, you know, best banks, bulge bracket and boutique advisors. Some of the most famous Tier one asset managers, you know, both APAC through to Europe, US. And we're pretty evenly split for now across consulting, asset management and banking. How that skews over time, I'm not sure. I mean, I think it will skew where the headcount is, which typically will mean that asset management will probably be slightly lighter by way of, you know, actual revenue. But that's on the basis that we're a seat based model or a usage based model. I think these systems over time may move towards an outcome based model, which actually you probably end up making more money from the larger asset managers. In other words, almost pricing on an AUM basis if I fast forward these systems sort of eighteen months out. [00:31:16] S0: Interesting because I was just about to follow-up on how do you think about pricing now? And how do you price it? Like do you price per seat and then per usage? You combine those, like how do you look at it? And how do you think this is going to change?
00:31:16 · Calin Fabri, Chaz Englander
[00:31:16] S0: Interesting because I was just about to follow-up on how do you think about pricing now? And how do you price it? Like do you price per seat and then per usage? You combine those, like how do you look at it? And how do you think this is going to change? [00:31:30] S1: So yes, for now we're a seat based pricing model. We do have a small number of large customers, on a usage based pricing model. I think the way the market will evolve is I think it will be seat based that will sort of evolve into usage based and usage based eventually may even evolve into outcome based, if I was guess. The way that we think about costs as well, to be clear, I think costs, in the last six, eight weeks, you'd probably rarely hear series A, B, C founders talking about the cost of the underlying models. But the thing is, is just based now based on what they can do and the volume that they can do. The example I used earlier of like, you've got a list that you're monitoring and it's going off and doing modeling and building materials, that list could be 3,000, four companies. Right? So suddenly you're building systems that subjects having the correct infrastructure are capable of building hundreds, if not thousands of models and decks all at the same time. The spend in terms of the models is clearly going to go up. That naturally means that you'll move probably slightly more towards a usage based model. You could see this obviously with what Anthropic and OpenAI and the other vertical players like LegalAI, for example, are doing.
00:31:30 · Chaz Englander, Calin Fabri
[00:31:30] S1: So yes, for now we're a seat based pricing model. We do have a small number of large customers, on a usage based pricing model. I think the way the market will evolve is I think it will be seat based that will sort of evolve into usage based and usage based eventually may even evolve into outcome based, if I was guess. The way that we think about costs as well, to be clear, I think costs, in the last six, eight weeks, you'd probably rarely hear series A, B, C founders talking about the cost of the underlying models. But the thing is, is just based now based on what they can do and the volume that they can do. The example I used earlier of like, you've got a list that you're monitoring and it's going off and doing modeling and building materials, that list could be 3,000, four companies. Right? So suddenly you're building systems that subjects having the correct infrastructure are capable of building hundreds, if not thousands of models and decks all at the same time. The spend in terms of the models is clearly going to go up. That naturally means that you'll move probably slightly more towards a usage based model. You could see this obviously with what Anthropic and OpenAI and the other vertical players like LegalAI, for example, are doing. [00:32:56] S0: And can you give us a sense on where you stand in terms of ARR? [00:33:01] S1: I can't. What I can say is we raise... I always I always forget why I should should I say. We... Look. We are We [00:33:10] S0: can beep it up. Like, we can beep it up after.
00:33:10 · Calin Fabri, Chaz Englander
[00:33:10] S0: can beep it up. Like, we can beep it up after. [00:33:12] S1: Yeah. Look. We're gearing up. We're actually in the process of raising again, I think, to be honest, just given how close these raises are, you've seen this in legal AI, etcetera. We're in the process of raisingannouncing again. And companies in the space are raising anything from like a 40 times ARR to 60, 70 plus times ARR and we fall within that bracket. I think from our perspective, we've barely touched the surface by way of capital that we've raised. I think we're just very, very focused on I think this is a little bit like the second, third time founder comes in of like ARR is just vanity metrics. You've really got to dial in on the metrics that count, the underlying retention, the activity of the underlying users, what they're using the product for feature drops and these sorts of things. When you walk around the office here, I'm in London, Sarah, in our New York office, you're not seeing revenue numbers. You're really seeing almost consumer type metrics, which is interesting because obviously our background across the first two companies are both consumer and in some respects, this is Arne I's bread and butter. [00:34:35] S0: Absolutely. If we change gears and get personal a bit, why do you think a lot of entrepreneurs fail to reach the success that you and your brother had? Where do you think they fail?