SaaS Interviews with CEOs, Startups, Founders
905 Went Public, $650m Market Cap, Crashed, Now $10m ARR But Only $1.8m Market Cap, Why?
15 Jan 2018
Chapter 1: What is the main topic discussed in this episode?
This is the Top Entrepreneurs Podcast, where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everyone. My guest today is Peter Friedman.
He's a social media visionary and veteran with over 30 years of experience in the space. He's the founder, chairman, and CEO of Live World. He's also the author of the CMO's Social Media Handbook, a step-by-step guide for leading marketing teams in the social media world. Peter, are you ready to take us to the top? We're here and delighted to be here. Good, very good.
So help me get in your brain real quick. Your average day, more time on Live World or more time on the social media stuff?
Oh gosh.
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Chapter 2: How did Peter Friedman start LiveWorld with no funding?
Well, it's kind of the same thing, but really LiveWorld. Okay. So tell us.
Yeah.
When you're the founder manager, you know, you live and breathe it.
Yep. So tell us about LiveWorld. For those that are not familiar, what's the business do and how do you make money?
Okay. LiveWorld is a social customer experience company that makes a conversation management SaaS platform and provide services to manage customer conversations for large brands and social media and messaging. Brands like Walmart and American Express and Pfizer and things like that.
And we make money through licensing them the software to use, providing them the online agents to use it, and consulting services, a strategy in their entire approach to social media and messaging.
So you're not, I mean, is your SaaS revenue enough where you consider yourself a pure play SaaS? Or do you have so much professional services mixed in that it's really more of a 50-50 balance?
It's both. I mean, the actual revenue numbers vary. And most of our clients buy a package. So how you break out the software and the services is kind of arbitrary.
Okay. Well, the margins are very different. What's that? I mean, it's not necessarily arbitrary. I mean, the margins are very different on a SaaS play versus a high-touch professional services play.
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Chapter 3: What services does LiveWorld provide to its clients?
Seats and page. Okay. And help me understand what a page means.
A social property, like an individual Facebook page. For example, Walmart has over 4,000 Facebook pages and That's a scale that what we do, nobody else can even do it. But you can't do it for the same price as one page. And it's kind of a proxy for data throughput.
Got it. And how is this different from like a sprinkler or a HootSuite when you're managing different Facebook pages?
Well, those guys really at their core are publishing platforms. Their core DNA is for the brand to create content and manage an authoring workflow of one or many people. Now, they branched out. So Hootsuite looks out at the web. Sprinklr has a little bit of everything. We are a purpose-built conversation management platform. It doesn't publish in the sense of go put on content.
It doesn't do ad serving. I mean, it can sweep the social web. But the concept that we have is social media is a human social platform with customers talking to each other and the brand. And if you want to really manage how they're talking to each other and do something with that, You really want that focus, which has been our DNA for the entire 22 years and back into Apple.
Do you touch anything of what like an intercom or a drift does with conversations on websites or you only do the conversations on social?
Well, we'll do conversations anywhere, but predominantly has been on branded properties like the brand's Facebook page, anything they want on Twitter, their blog. So it's Facebook, Twitter, Instagram, YouTube, G+. Lots of messaging platforms now, Facebook Messenger, email, web chat, in-app chat. The key thing for us is there's conversations going on.
We have some clients who suck in emails with it. So it can do a lot of things like that. It can actually sweep the whole general social web, like social listening products, but we don't really use it for that.
If we have a client who really wants to do that, we use something like a brand watch, which has certain types of analytics for general social web, if you're looking for buzz and measuring that. But if you want to manage those social web conversations, We're really going to engage with them, case manage with them, organize and know what's going on.
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Chapter 4: How does LiveWorld generate revenue through its SaaS model?
Then you use our platform.
Got it. And how many customers do you have using that SaaS platform today?
We have about 20 something clients overall. And I would say 15 plus have the SaaS platform.
Okay. So you're very much a high touch, kind of low volume kind of company, right?
Well, our clients are really big. So, you know, we're managing a million, we're delivering two and a half million or more hours of moderation engagement a year. And, you know, a million, two million comments a month
My point is, though, you're working with 20 customers or other SaaS companies.
It's not like here's a little low cost thing.
Everybody just, you know, I didn't I didn't say low cost. I said low, low volume, high touch, high ARPU.
Low high. It's a value focused company working with very large brands, some of whom have very large volume. But it's not like it's. Hundreds or thousands of customers, low touch. It's few customers, high touch.
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