The Exchanges

Q sort of like legal issues, right? Competitors just trying to be nasty and sue them because they're early to kill them. You, you won that bet. I mean, how, give us some kind of, how much did you spend on legal bills back in the day? And like how much time and energy did it take? How did you get the team like morale high to make it through that?

A So it was pretty ugly. We had four class action lawsuits over a feature we had where if you called me, it would automatically send you a text back. Saying I'm busy, go to my website, send me an email, whatever the user wanted. That was called auto reply. Uh, people said, oh, that's violating TCPA and sued the founders personally, right? And the executive team personally, as well as the company. It took three years and about a quarter of a million dollars to get out of that mess. Ultimately, the FCC found we were doing nothing wrong. We're actually innovation that they, they like to see. If someone calls, they're giving you permission to call them back. That was, that was essentially it. Totally. And so that, but that was extremely draining. The team stuck with it because we believed in the vision. Even in 2012, 2013, we saw call blocking coming. We started our first, you know, uh, variance of our features to make that easier. And once, once we got done with the lawsuit, then we were able to raise the crowdfunding round and, you know, the rest is sort of history. Everybody's really glad they stuck around because we're making such a huge difference now.

AI assessment note: “It took three years and about a quarter of a million dollars to get out”

Q bucks a month. To your point, with 70,000 customers, if you increase ARPU by 10 bucks a year across 70,000 customers, that moves the needle for your business. It's adding almost a million bucks of new ARR. You haven't talked about what products you've started selling more into the B to C range to increase that ARPU by a couple dollars every year. You want to talk about that? Yeah.

A So one of the things we did is we have a product called email plus, which is our privacy protection offering. What we did it to that offering is we added something where we can guarantee you won't get robocalls a hundred percent. No robocalls are going to get through. That's something that consumers found worthwhile. And that enabled us to move from a four 99 ARPU for that particular product up to where it looks like it's five 9906 99, even with discount and with annual plans. And so it was creating a better value proposition. It was one thing to, we'll block most of them. We'll give you some customization. It's another thing to say, nope, we guarantee it. We're going to block every single robocall. There's no way a robocall is going to get through. And when we were able to deliver on that promise, we're seeing that churn goes down and we can charge more.

AI assessment note: “we have a product called email plus, which is our privacy protection offering.”

Q Okay. And then lastly, marketing, how do you find marketing contractors? I know what they're doing.

A So it's, it's kind of the network effect there too. So there's a lesson here, right? So in our network, we had one person who's been kind of an outsourced CMO for a variety of companies. We brought him in to help us with strategy, positioning, a whole set of things. And he started going, well, you guys really need help here. I know somebody, let's bring them in as a contract for 20 hours a week and work on something. I know somebody else and gradually built that up. And then we've been hiring people too. Like some of the contractors have become full-time because they really like working with us. But, you know, when you start out, your online marketing guy doesn't have to be 40 hours a week. Your online marketing guy can be 10 hours a week to run a limited set of campaigns and tests that they're trying to do to advertise your B to C stuff. So we found the contractor model really, really works, but it's because we have trusted people who are bringing them in. We have not just gone to a random firm who's contacted me on LinkedIn and said, yeah, let's outsource development. And so it's about building your network, right? I think it's really critical to build up a good network that you can then leverage for this sort of stuff.

AI assessment note: “we have trusted people who are bringing them in.”

Q anything, but they've written this investment off, right? It hasn't, it hasn't tripled every year, which is ridiculous anyway, but that's what you sign up for when you, when you do VC. So, I mean, can you buy those early folks out, clean up the cap table and get more of this bad boy back? Or if not, why not sell the business and move on to the next thing?

A So, you know, the thing is the value we've created in the last couple of years exceeds everything we created in the first, you know, 1012 years of doing this. So the whole point about when do you want to sell out? When do you want to, uh, you know, try to buy out investors is when do you think you've hit the point where you can get a really good return for them? And you're probably not going to do better over time. If I, if we'd sold this thing in The business was kind of flat growing slowly. We hadn't completed our transition. It would be completely uninteresting to get a, a two X or maybe even lucky at three X on five million in revenue, right? Nobody's happy. Now we're growing at a good clip. Everybody can look out a couple of years ago. If you keep that up, this is going to be a nine digit plus business when it goes, why would I jump out now? And so it's a bit of a sunk cost fallacy people have, right? Cause this is kind of the opposite, which is this isn't going anywhere. It's never going to go anywhere in the future. You can't make that conclusion. You have to look at where it is now and say, what's going on? What's the evidence this is going to succeed or fail?

AI assessment note: “this is going to be a nine digit plus business... why would I jump out now?”

Q Did you just let the six to 5000 B to C customers churn off or like how many customers are you serving today?

A Uh, actually it's grown a bit. The thing is the B to C business is critical for us. They're a sensor network that tells us what's going on with scam calls. So everybody who has email is contributing to the fight to stop robocalls. There's data about this illegal call hit this person and let this message pretending to be say Amazon. That's extremely valuable for the enterprise side of the business. Because we have all this data we can use that tells us here's exactly what's going on. Here's where those calls are coming from. And here's how we get rid of them. Same with the carrier. So if there's a wholesale carrier, we can look at what's coming from their network and show them here's the illegal activity that's hitting our pool of consumers. So in our case, the B to C business is the critical enabler that allows us to have a differentiated B to B solution.

AI assessment note: “Uh, actually it's grown a bit. The thing is the B to C business”

Q Okay. Everyone wants the playbook. To using contractors. Someone's going to build a billion dollar business and have one FTE as the founder and then a network of contractors. So you got it. You got to teach us here. I mean, who are you using for development and how did you find them?

A Well, so the really key thing for us is that we have a core development team. We aren't outsourcing at a hundred percent. What we wanted to do was find support for tasks like maintenance or relatively simple tasks that don't require a really complicated skillset. If you're fixing iPhone bugs, that's completely different than if you're building an iPhone UI from scratch. You're building complicated, uh, data manipulations. That's a different group. So we contract out a lot of what I would say is the easier stuff. And it was through our network. We found someone who basically built a contracting firm in Asia who knows how to pull people together with the skills we want. And it's been able to staff up and down as we need. It's amazing.

AI assessment note: “it was through our network. We found someone who basically built a contracting firm in Asia”