Building a Fat Startup in Corporate Training: Karl Mehta, CEO of EdCast (Part 2)

Sramana Mitra: What happened to the first company?

Karl Mehta: We built it all the way. We had a great Series A from Mayfield Fund. Palm, which at that time was a mobile device, was an investor. We built it to about 70 people. Then, 9/11 happened. We had a hard time. Nobody was funding any company. We had to shrink it down to almost 20 people. We refocused on B2B instead of B2C. We, again, rebuilt the company to about 75 to 80 people. We turned it into a $20 million run rate. In 2005, it was sold to Wireless Matrix.

Sramana Mitra: When you did the turnaround, what was the business model? >>>

Bootstrapping an Ad Tech Company from Paris: Daniel Nathan, CEO of BidMotion (Part 5)

Sramana Mitra: You’re catering to French clients?

Daniel Nathan: Actually, we don’t have any French clients.

Sramana Mitra: Where are the clients from?

Daniel Nathan: US – a lot of them from San Francisco.

Sramana Mitra: How did you find these clients? >>>

Building a Fat Startup in Corporate Training: Karl Mehta, CEO of EdCast (Part 1)

If you haven’t already, please study our Bootstrapping Course and Investor Introductions page. 

Serial entrepreneur Karl Mehta is applying consumer education models from MOOCs and such to the world of corporate training. Very interesting spin on online learning.

Sramana Mitra: Let’s start at the very beginning of your personal journey. Where are you from? Where were you born, raised, and in what kind of background?

Karl Mehta: My background is in engineering. I did my undergrad in Computer Science and Electrical Engineering.

Sramana Mitra: First and foremost, where were you born and raised?

Karl Mehta: I was born in Mumbai, India. After getting my undergrad degree, I came here in 1994. It’s been about 20 years in the US. >>>

Bootstrapping an Ad Tech Company from Paris: Daniel Nathan, CEO of BidMotion (Part 4)

Sramana Mitra: What happens next?

Daniel Nathan: My first company was not going to copy the technology I was building. They were not going to buy on CPM. On the other side, my company was not going to go to direct advertisers. The issue was that advertisers wanted to work with us directly because they had much more control. The incubator came in and said, “It doesn’t make sense to have two companies competing with each other.”

My third company bought us and then I stayed in the company for six months. I plugged the technology and the team. The team today is still the most profitable team in there. What happened is I wanted to do something else. When we built Uplift, we were using a third-party technology to build our business. We were not using our own technology and I always thought that this technology was not efficient. It was managing all the data and it was not applying any type of optimization algorithm or machine learning techniques. >>>

Greece Has A New Atlas: Marine Traffic CEO Demitris Memos (Part 6)

Sramana Mitra: Listening to you and the story, you’ve already hit your stride. You’re growing at 60% year over year. You’ve got internally generated cash. If I were you, I would probably not take external financing. How does this company become a billion dollar company? That question is not clear.

On the other hand, you don’t need to become a billion dollar company unless you take $10 million from VCs. If you can’t convince VCs how you’re going to become a billion dollar company, they’re not going to give you $10 million. At some level, you may not want to waste your time chasing venture capital. Just focus on chasing customers and before you know it, you have a $50 million company that you and your partners will own yourselves.
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Bootstrapping an Ad Tech Company from Paris: Daniel Nathan, CEO of BidMotion (Part 3)

Sramana Mitra: What did this company do?

Daniel Nathan: Groupon for video games. I went there for the summer. I said, “We’re going to become an incubator and build multiple companies around video games.” I said, “I’m going to build a mobile ad network specialized in video games.” We started with three people in 2012. After one year, we were about 100 people and raised $20 million.

I was a minority shareholder because most of the shares was owned by the incubator. I learned a ton. I met great people. I worked with Germans and Germans have a reputation for good reason. They know how to execute. I’m very passionate about technology so I wanted to dig more. That company was more of an agency than a product and tech company. I pitched another idea to the incubator which was more of a tech company to buy ads in real time. They liked the idea so they give me $100,000. I was with my co-founder. After one year, I went back to them with $2 million in profit. >>>

Greece Has A New Atlas: Marine Traffic CEO Demitris Memos (Part 5)

Sramana Mitra: How many of those customers do you have? Is that a much larger customer base?

Demitri Memos: In total, we have just over 4,000 paying customers.

Sramana Mitra: There is a lot of SMBs that need to track and that includes all kinds of smaller operators.

Demitri Memos: There is also service providers who use our service for lead generation.

Sramana Mitra: Do you have a sense of what is the TAM for your service? If you were to scale this over the next five years, how big can this get? >>>

Bootstrapping an Ad Tech Company from Paris: Daniel Nathan, CEO of BidMotion (Part 2)

Daniel Nathan: After I studied Finance, I tried working in Finance. I did six months internship as an M&A Consultant in Deloitte. I really hated it. I was going to the restroom four times a day to sleep half an hour. They gave me a contract to work full time. I said, “I think I’m going to follow my passion and keep on doing Internet stuff.”

I went back to school and built another company. I did some research about the coffee machine. I understood that when you buy cheap coffee machines, 80% of the cost is actually the cup because the cup costs more than the coffee. I said to myself, “Why is it so expensive?” You had to pay somebody to change them, you had to build them, and import them. I said, “I’m going to call the coffee machine companies and tell them that I’m going to offer, for free, the service of changing the cup.” >>>