Capital Efficient Entrepreneurship: Voices.com CEO David Ciccarelli (Part 3)

Sramana Mitra: While you were going through this evolution, did you still have the recording studio running?

David Ciccarelli: We began a working relationship. We quickly grew quite fond of each other. Stephanie likes to say that’s when it got to be romantic. Through that experience, we recognized that we couldn’t exactly have garage bands coming to a studio with Stephanie putting a baby to sleep in the back room.

It made a lot of sense for us to pivot to a website and to just do the work ourselves. All the other recording equipment, we actually sold off. We used the funds from that equipment to hiring a web developer on a freelance basis to further enhance the website that we created. It was really a shifting of resources.

Sramana Mitra: You were basically pivoting to becoming a marketplace for voice-over talent.

David Ciccarelli: Exactly. The financial source that we drew from was that original recording studio equipment. That’s probably a common theme. Every entrepreneur needs to allocate resources in the most efficient manner possible. That was something that we decided to do.

Sramana Mitra: What was the business model? Were you monetizing all these people who were coming to your website looking for voice talent?

David Ciccarelli: At the outset, because we had a few dozen people on the website, Stephanie wrote a very long compelling email that said in short, “In exchange for a small membership fee of $49 a year, we will give you a profile online and market you intensely.” Going back 10 years, this was before Facebook, LinkedIn, or Twitter. There was nothing like this where you could create a profile.

The first night we went to market, we offered free membership. We actually had 100 subscriptions that first weekend. With $5,000 of initial sales, that became go time for us to go out and bring those clients to hire the talent. That was always the brand promise. We don’t guarantee you work, but we do guarantee you opportunities. If they like what they hear, they will reach out and hire you.

Sramana Mitra: That $49 a year, you must’ve changed that.

David Ciccarelli: Yes, we changed it a few times. It has gone up. Now, it’s $400 a year annual subscription. There’re several thousand people on that subscription plan. That was our first monetization path. What we discovered though is that’s on the sell side of the marketplace.

Sramana Mitra: That was my next question. Where did the buyer side come from?

David Ciccarelli: At that early stage, it really was a matchmaking service. We were advising the talent that they should probably get 50% upfront and never deliver your broadcast-quality files to someone over the Internet. If they don’t pay you, you can’t get them back. Mostly, it was a policy of 50% upfront through PayPal. We soon discovered that that was a key point in the transaction – that hiring process.

I had the opportunity to actually pitch on Dragon’s Den – the equivalent of Shark Tank in the States. Dragon’s Den was an entrepreneur pitch television show. The short of it was I ended up getting turned down for all of them but they did provide some very tangible feedback. They said, “You have a two-sided marketplace. You’re monetizing the sell side. You’re not monetizing the buy side. Figure out how to do that.”

The solution was that we built an escrow service. The talent quotes on how much they’re going to do the work for. We would add on a 10% transaction fee. When clients look at the prices, they see that. If they click the Hire button, that would immediately bring them to a credit card form in which case they would deposit all of the amount. The talents do the work in their own home recording studios and deliver the finished broadcast-quality files over the platform. The clients get to listen to them and request any edits or approve.

Upon doing so, money is released from that escrow service and we pay out the voice talents the amount that they quoted. Our income is that difference. Now we’ve built a true transactional marketplace where we monetize the transaction and we provide the feedback ratings and reviews. That has instilled a sense of trust and credibility in all the participants.

This segment is part 3 in the series : Capital Efficient Entrepreneurship: Voices.com CEO David Ciccarelli
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