Although films were invented fairly recently in human history, they have come a long way in that short period of time. Technology has improved to the point that anyone can record their own videos, edit them, and then share them with the click of a button.
Axle.ai is a suite of offerings that make video editing a lot less complicated. Using its hybrid cloud browser structure, the company helps users to organize, search for, and manage their video content with its flagship axle.ai software. We reached out to co-founder and CEO Sam Bogoch to learn about the company’s origins and future of video content.
Note: This interview was conducted over phone and email. It has been lightly edited for clarity and length.
Can you give us a brief elevator pitch for your company?
Axle.ai makes media smarter. Our software platform helps creative teams remotely search, manage, and repurpose large amounts of video content. We’re at the intersection of three high-growth markets: remote work, video, and AI (artificial intelligence).
What inspired you to take the leap and build this company?
I was head of product management at Avid, responsible for its Interplay and Media Central software, which addresses the video management needs of large broadcasters. Meanwhile, video was starting to become a much more widely used medium, and there was budding demand from sports teams, corporations, governments, universities, churches, and regional broadcasters. I proposed development of a lower-cost solution to target these segments, but Avid chose to remain focused on large, centralized broadcasters at that time. When I left Avid and co-founded axle.ai, the other founders and I saw this opportunity clearly, launched the company and started building a 1.0 product.
What past experiences prepared you to start, build, and lead your company?
My product management experience at Avid was one key component. In my last year there, I had a global enterprise sales role that gave me experience in managing channel sales and in proposing and closing large enterprise systems of up to $10 million. In addition, I had previously run a small systems integration company focused on the photo imaging industry and between those two roles was prepared to manage development and field sales teams of between 10 and 300 people.
My role at Avid also involved a high degree of partnership management with technology partners, which has been a key skill as we have grown axle.ai. Finally, I have a good understanding of the full solution stack and life cycle, having done a significant amount of software development and hardware integration earlier in my career.
What is your vision for the future of the industry you are operating in?
We believe strongly that “smarter media” isn’t just a slogan. It’s a necessity in the coming years as the importance and volume of video content continues to grow exponentially. Video is becoming the dominant communication medium across a wide range of industries, and the number and extent of teams who have to manage it will continue to expand. Having all that content tagged, searchable, and instantly reusable offers huge value across the industries we serve. If that media is just stored on individual silos with often-cryptic file names as it is today, its value will be far lower.
In addition, due to the long-term shift towards a more flexible workforce (accelerated by 2020 and COVID), this work will have to be handled in a distributed way. While a certain amount of the software management layer may be provided by individual cloud and on-premise storage vendors, there’s a clear need for an independent software solution that can span multiple types of storage to manage the overall view for each media team and across teams.
Who is on your team and how did you come together?
We have 25 full-time staff, mostly international but with a core leadership team in the US and UK. Patrice Gouttebel, my co-founder and our vice president of product management, worked with me previously at a photo management software company and has strong industry experience and leadership skills. Katy Scott, our vice president of operations, joined axle.ai a year after our founding and has a media background and has grown strongly into her management role over time. Neil Blake, who heads up our EMEA business (Europe, the Middle East and Africa), worked with me at Avid as a partnership manager and has over 35 years’ experience in the video and broadcast industry. And Alex Hamilton, our US vice president of sales, brings over 25 years of experience in the media software industry, including successful roles as a regional sales leader and industry analyst.
Do you have any competition, if so, how do you differentiate?
Axle.ai’s main competitors are as follows:
- Larger systems companies – Sony, Avid, Dalet, and Grass Valley all offer bigger, pricier solutions for video management, but they’re beyond the reach of axle.ai’s targeted audience.
- Network storage companies – Video specialists EditShare, SNS, Facilis, and now Quantum offer bundled software in this space. They’re more limited in reach based on close hardware ties.
- Video tagging and transcription companies – Veritone, GrayMeta, Rev, and Digital Anarchy all focus on harnessing AI in the creative space but don’t compete directly with axle.ai.
- Major cloud companies – Google, Amazon, Microsoft, and others all provide powerful solutions in the cloud, as do Vimeo and Frame.io. As yet, none of these tackle key aspects of on-premise video storage, which is where most video content lives.
What does your business model look like?
Our typical sale today has a per-customer lifetime value of $13,500, with gross margins of 80% to 90%. This includes a combination of one-time and recurring revenues, with the one-time revenue including a software license plus any professional services needed to configure and commission the instance of software (whether on-premise or cloud), and the recurring revenues being a mix of AI/ML services, such as speech transcription and face recognition and annual software updates and support. As part of our recently announced partnership with Seagate, we’re working to evolve the business model into a high/low mix with more sophisticated multi-site versions of the software aimed at larger accounts and an entry-level solution aimed at smaller teams and even individual videographers over time.
What brought you to equity crowdfunding and how do you intend to use the money you raise this round to scale the business?
We had a successful equity crowdfunding round last year on Republic and were impressed with the potential of the platform to not only raise larger amounts of money but also to expand our marketing footprint as we grow the company and customer base. We’re currently raising a maximum of $428,000 and are looking to use the proceeds to expand our marketing (60%), grow our development team (30%), and for G&A (10%).
What do you want potential investors to know about you and/or your company?
The intersection of remote work, video, and AI — all sized in tens of billions per year and growing in the strong double digits — is a fantastic opportunity both for us as a company and for our investors. The need for our platform has hit an inflection point, and we see continued rapid growth as we expand our footprint in a market segment that already encompasses about 400,000 media teams worldwide and may grow to over a million teams by the end of the decade.
As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? have you set any future goals for the company?
We have had two significant offers to acquire the company, one in 2019 and one in 2020. Both times, we took a close look and decided to continue independently, but of course we are open to the right deal coming along at any point. We’ve also seen many of our current and potential competitors acquired recently (11 in the last eight months, resulting in a significant change in the playing field) and the entry of two public companies, Vimeo and Quantum, into the space.
Given this recent pace, it’s hard to look out as far as five to 10 years. Overall, we expect the market opportunity to keep growing rapidly, and if we stay independent with continued strong revenue growth, we’re optimistic about attaining a valuation much higher than our current $9 million valuation cap. Whether we achieve liquidity for investors via sale of the company, SPAC (special purpose acquisition company), or other vehicle depends on the quality of the opportunities we’re seeing in each category.
We at KingsCrowd are excited to see where Sam and his team take the company. Axle.ai is currently raising on Republic.