Bootstrap an AI Startup First, Raise Money Later: Sean Minter, Founder CEO of AmplifAI (Part 5)

Sramana Mitra: So, when you raised $3.5 million, what did you determine as the place where you needed to invest? Was it people? Was it a certain go-to-market strategy where you were doing customer acquisition? This is a sales-based business, right? It’s a business where you have to actually do the selling. It’s not a digital marketing kind of business.

Sean Minter: It is sales-driven, but it’s driven more by customer success in many ways, because you can get a customer to come in and pilot with you. But what drives a business is getting that customer for the long term and growing them, not a small initial pilot.

Sramana Mitra: That is right.

Sean Minter: So you have to bring them in from a sales perspective, but sales drives a small amount of revenue. Nobody’s going to sign up for a large amount on day one.

Sramana Mitra: Yes.

Sean Minter: Customer success really drives the land and expand strategy. Most of your revenue growth usually will come from there.

Sramana Mitra: So that’s where, where you got the money to invest in – the account management.

Sean Minter: Customer success, and obviously tech product, but customer success is our largest organization that drives customer relationships, customer stickiness, customer growth, getting into new lines of business, and referrals from customers to other customers. Especially since we target mid to large enterprise customers, which are very much more relationship based than the SMB segment.

Sramana Mitra: Yes, it is relationship-based, but it’s also ROI-based.

Sean Minter: 100%. Only ROI-based when you get to that size client.

Sramana Mitra: Talk a little bit about how you calculate ROI and how you derive pricing out of that?

Sean Minter: ROI comes from multiple places. One, people efficiency. They can use this to make people more efficient so that they need fewer people. That’s a hard ROI.

Two, productivity improvement. Somebody takes X amount of time to do work, and now it takes them less time to do the same work. So you get productivity improvement.

Three, ultimately, any kind of customer experience improvement. For instance, we’re in the contact center business where NPS and customer satisfaction improvement are all soft benefits. It’s hard to quantify a dollar amount to that. It’s hard to put that in ROI. That just becomes an extra benefit.

Employee retention becomes another benefit. In contact centers, there’s a lot of churn. Training is an expensive line item. So in our view, ROI comes from employee productivity, efficiency, and reduction in employee churn. Then you get the side business benefits of customer satisfaction and NPS improvements.

Sramana Mitra: You said you were charging $10 per month, right?

Sean Minter: It depends on size of the client. For a large client, it is $10. For smaller clients, it is based on volume and it can be $30-$40.

Sramana Mitra: So, based on the line items that you noted in this conversation, when you’re charging $10, can you deliver a $100 ROI per month? If you’re charging $30-$40, can you deliver a $300 ROI per month?

Sean Minter: We have lots of case studies with clients where we’ve delivered ten X and greater ROI in terms of hard dollar savings to customers.

But some of it also requires the customers to do things. That’s the other variable in our business. You can’t just give people software and say, “Good luck, go at it!”

Sramana Mitra: Right, that’s where you get churn.

Sean Minter: If you put your put all your eggs in the customer doing everything they need to do, you’re going to lose. You have to actually hold their hand through the process, teach them, follow up with them, and make sure they’re doing the things they need to do.

If you do that well, which is a customer success account management team, that’s how you show success. Otherwise, thinking you can hand the software to a company and let them kind of run it and be successful at it is also a bad idea. It’s hard to have that much dedicated service in the small business world, but you can in the mid to large customer segment.

Sramana Mitra: Customer segment choice-wise, where have you positioned your company? Is there a particular type of customer? You said mid to large, but where you do well? Is it telecom?

Sean Minter: Among verticals, Telecom is one. We have four large verticals – Retail e-commerce clients, Health care clients like insurance companies, Financial services clients that have lots of financial services activity, and finally, tech and telecom kind of clients.

Most of our business comes from that. About seventy percent is with clients directly and thirty percent is with outsourcers where they outsource their customers to the BPOs.

This segment is part 5 in the series : Bootstrap an AI Startup First, Raise Money Later: Sean Minter, Founder CEO of AmplifAI
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