In this episode, Jeff Kofman and I discuss his journey from journalism to tech startup CEO. Jeff explains how he came up with the idea for Trint.com, an AI (artificial intelligence) transcription service. He then shares insights into the pricing strategy for their SaaS (software as a service) product.
About Jeff Kofman
Jeff Kofman is the Founder and CEO of Trint. Trint creates a transcription from a recording with timestamped links from the text to audio. Before founding Trint, Jeff was a news correspondent for CBC, CBS and ABC. He won an Emmy for his coverage of the Arab Spring in 2011.
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Below is an example of a Trint transcript with no manual editing.
[00:00:00] Welcome to THE ART OF VALUE show Jeff Kofman. Jeff is the CEO and founder of Trint dot com. Trint started at an Italian Air B and B in 2014 prior to founding Trent. Jeff has been a news correspondent for CBC CBS and ABC. He actually won an Emmy for his coverage of the Arab Spring in 2011 and he speaks English French and Spanish. Jeff welcome to the show.
[00:00:28] Well thanks Kurt. Thanks for inviting me.
[00:00:30] Well it's a pleasure. I learned of Trint, I can't remember how I think it was in a Facebook group and when I learned about the service I thought you know what this would make an interesting topic for the show. But before we get into that what's the most important thing you could share about pricing customers aren't always looking for the lowest price they're looking for the best value.
[00:00:51] And I think for someone like me it was a first-time entrepreneur I spent my life as a journalist and I think oh my gosh if we raised prices will they run away. But not if they see value. I think there's an axiom that I've run into many times which says that startups usually underpriced their product and I can understand why because you don't want to scare people away when you're trying to attract customers. But the thing is you've got to charge what makes you a sustainable company. And in our case, we have a huge amount of innovation in our pipeline. And so, if we're going to be a viable business and so far, we're very much viable.
[00:01:28] We need to be able to charge a price that allows us to build a team that can build the product that people like you and me as a journalist and so many other people describe that tension between OK we want to make sure we get customers but yet realizing the value that you're creating for the customer and pricing appropriately for that. How do you resolve that tension or how would you suggest somebody who is trying to work through that approach it?
[00:01:56] I think pricing strategy is one of the biggest puzzles of the journey for me on the startup because partly what is challenging about trends is that we're inventing something that has no precedent. And so, we look really hard for models that take lessons from you know we transcribe recorded audio and video in the cloud through artificial intelligence using automated speech and get you the mechanism on the tree to editors to get perfect. That's always been the conundrum really cool that you can be you can ask our other major speech recognition to do so well but it makes mistakes. And for that reason, for me you know my 30 years in journalism flawed data is useless data. I can't if I can't verify I can't use it. And what Trint did was find a way to do that so you know we try to measure what. How big is the market whether people are using what do they do now? But most people transcribe on their own so I know how do you put a value on that if you're $40000 you're $60000 you're a reporter and you're spending you know five hours a week, six hours a week for transcribing. Is that the value. How do we prove that? So, it was really difficult concurrently in our release form. We charge for the minutes the hours you upload. That will change as we add more. Features and more and more added value features to the transcriptions and that's coming in 2018.
[00:03:25] But you know when we look for models for pricing it was really brainteasers the closest we could get actually was your cell phone plan where you know you're remember the early days you bought minutes and you were always concerned you go over because they charge you a fortune. So, then the cell phone companies had unlimited minutes. Well that was a problem because they couldn't contain abuse. Then they created rollover minutes. Well the problem with that is they create liabilities because if your minutes go on month after month after month the phone companies discover they had huge viability on their books. So, then what they just done was well let's put the ceiling high enough that you're not likely to hit it unless you really are abusing. And so most of us as we text so much to most of us don't really worry about how much we talk on our phones anymore. And that's how they resolve that kind of gave us some guidance for us. But you know it's not completely the right. It's not it's not a direct parallel but it gave us some understanding of how pricing works on our consumption models. You know you talk about value pricing. That's definitely where we're going in 2018. You know we have a whole roadmap of innovation that is much more transparent. But you know at the early stages for a startup like this is consumption based a couple of lessons I want to draw out of what you said.