Listen: This Industry Hasn't Changed in 50 Years. One Man Is Trying to Change That.
"Jamie. Thanks for joining us. Today is way getting started. Tell us about yourself well. Thanks for having me well. We are working on right. Now is a software application that converts audio and Video Co two tax using machines and with that we can do it in a fraction of the time that it would require for traditional services this and at a fraction of the cost so how we got there was looking at an industry that hadn't changed very much and transcription is something that's not changed a lot in the last fifty years and so with the new technologies algae's out there in terms of speech recognition and natural language processing and computing power. We've got opportunities to do things like what we're doing. Who and how did you come up with this idea. What was the initiative well. It started with a role I had at my previous this company zero and I spent a lot of time thinking about how we should market our products how we should talk to customers water customers saying about us and if we had all that information it'd be a lot easier to come up with campaigns and programs and sales strategies and what I realized with speech data is all those conversations. You're having with your customers. Whether it's in your customer support sportscenter or your sales teams that's great data but until recently it wasn't possible to mine all that data to derive insights and and now with the massive increases in computing power and and the amazing results you get from natural language processing in speech recognition it's become economical and so that's where the premise of the company started and we built it around those hypotheses and so what you go to market strategy. Oh Gee who you're going after what's the use case yeah well. We we recognize that as a I guess a North Star but where we started was like many startups we wanted to get the product in front of users as quickly as possible and so we built a tool a the basic tool to convert audio video text and we return a transcript while say you upload a thirty minute audio file will we can return a transcript in less than five minutes and at a cost of five dollars per hour so actually for thirty minutes is two dollars hours and fifty cents so we wanted to get out to market and see what kind of reception we would get and we did that and and the reality is with automatic transcription. The result from your convert conversion of audio to text is not one hundred percent perfect. There's still some issues with our algorithms machines that do this and a lot of it has to do with proper names and words that we just don't have in our dictionary and so what we did was stitched together the audio and the transcript into a browser so now what you could do is click on a word and you can actually play the audio behind and what that did was allow people to quickly clean up areas where there were mistakes and so that's the v. you want what we built and we got to market and we started realizing that a lot of journalists for example saw benefit in this and their use case a good example is they're doing a story. They interviewed a few people they WANNA get that story out as quickly as possible and now they can upload a file and interview file to us have a transcript back in and five minutes or less and they can work off that transcript and get their article out much faster obviously at a fraction of the cost the cost for human transcribers so that's one example and so who's your target market kit call centers sales people as a podcasters it anybody or yes we are focused on. Yes yes so I set up at. This is where we wanna get to and the ties to the beat of the enterprise selling where we're at today is more of consumers within side within large organizations so our target market is anyone that creates audio video content and right now. It's more so on the creative side so as you mentioned podcasters radio producers offers anyone that creates video content for their website or their brand. Even broadcasters are using our systems the reason we're focused on that right now is because of the quality of audio and video that these individuals create and they do much better through our the systems if your audio and video is of higher quality over time we're going to evolve the algorithms and get better at dealing with background around noise and and issues that hampered the audio quality and then we can get into the to call centers and and larger sales teams and what's your competitive advantage because there's a ton of people that are dabbling in this area and many different dimensions in directions well the number one reason that people choose sonics is because of accuracy and we've got are are proprietary technology that we use as well as leveraging a number of publicly available. API is that do speech recognition and that allows us to optimize around different languages different accents in different varying degrees of audio quality and people speaking at different times that type of thing so number one is is is accuracy and then the other is we built a number of tools around spoken word video or audio that make it easy for people to repurpose content and if you're you know a business. I think everybody knows content is king and the reality is a lot of the individuals that use sonics. I have amazing content but they aren't repurposing that content and getting the full benefit of Seo or optimizing for search and but how do you scale something like this because it sounds like you're biting off a big chunk. Yeah I mean that's That's a big question that is probably I believe quite a long answer that alone. I think we could have entire show about but I guess it's it's in parts and our experience our previous experiences. I've been through it a couple times and understand how you get through. The several state ages asked that right now. We're early in our journey. It's been a year and a half since sonic started and so we're we're really focused focused on customer feedback and making sure we're building the product in the way that it's going to benefit our target market and in terms of scaling. There's you know the way I guess I look at any organization and having to pass as I break it into three chunks. It's it's like what are we doing in terms of product. What are we doing in terms of people and then I lump everything else under programs. which would be sales programs marketing programs partnership programs? Thanks so we've got all of those going on where we are right. Now is mostly focused on the product side of things making sure. We're building something. That's valuable to the end user. The go to market strategy is have a website. Are you doing any advertising any content development. And how do you get customers. How did they find out about you. It's mostly organic right now and we have focused heavily on the content side of things so so we built a website optimize that for search and we do a number of things through social media and some direct orig- through those social media platforms that we have not yet paid for advertising other than we've done a an event event where we had a chance to talk to and meet face to face with customers but we're in the fortunate situation where this is a massive acid industry. There is a huge pain around transcription and the conversion of audio and video to text and it's really about optimizing search at this point and do you see that changing as far as your marketing strategy are you looking to raise is money to expand that or are you trying to bootstrap it yeah. That's that's another show unto itself as well so my last company we raised. I a lot of money was inexcessive. Two hundred and fifty million dollars and that is is I feel there's a time and a place and there's certain companies that require that kind of capital and it does come with pros and cons and with with Sonics. I'm taking a different tack and we're we're self-funding this and we're gonNA take that as long as we can and if there comes a point where I think it makes sense to raise capital because we really want to put the foot on the gas then we'll we will we'll entertain that ah but as of right now the the plan is to maintain this cell phone and so we're already driving revenues where building customers the prospects look good and that's a good situation to be in but I'll say never say never but I think when you look at the the traditional philosophy in Silicon Valley as you come here and the goal is to raise money and in my view the goal is to make money not raise money and so it's a bit different perspective although there's a lot of people that agree with what I'm saying being in our backyard it's it seems like the prize is to raise money but I feel like that. In some respects is a negative event and meaning. You need need to raise money to to get to where you you. WanNa get to but if you can build a business that is generating income. I think that's the ultimate goal. Yep because sometimes it's easier to raise money to make it so yes. I've seen that in many many times apparently but but I would think in a space like this is going to probably be whittled down to three major players. And how do you make sure that you're one of them. Well that that is the exact question I ask myself is this a winner takes all industry. If it was then yeah you wouldn't need to raise money money and compete and I'm not sure it is and that's why I think we're gonNA keep doing what we're doing and we'll see how the marketplace out now and build some great software for for people are GonNa Meantime and when you say it is that would imply that there's either niche or a capability ability that would fit a niche better than another one that does it because at the bottom of it everyone's using pretty much the same algorithms right yes so let me back up yeah. The the the nature of transcription is there are so many different market needs for it and I'd named a couple where we're focused on and so they're in our multiple opportunities. If you just focus in on in different industries so if it was just the legal industry for example or just medical industry or if you really focused on sales teams or call centers there's or podcasters a radio all those. I think we'll have vertical is solutions and we've already started to move down that path which is beyond just pure transcription the fact of getting a transcript back an audio or video file. is is one thing in an accurate way building tools for people those individuals to make their workflow faster is is where we're focused focused and we've done that with with podcasters for example a radio journalist for example and integrations into tools that they would already thirty us like Adobe Premiere are. Dobie premier or adobe addition and then we go as far as building publishing pushing tools to help get their she goes out to the market and in our case because we have built the system with the transcript stitch the audio guess what we now have an often we have the potential optimize their shows for search because because Google and other search engines do not crawl audio or video as well as they do text so those are some examples yeah I mean they're working on that supposedly -posedly though right I mean Google kind of announced that they're going to start searching podcasts. Yes yes they will again. I think I mean we work with Google pretty closely and we work with other. API's as well the reality is they don't build out systems the systems to the degree like they're more of a platform and so we see them as a partner as opposed to a a competitor"