What does it take to start a $10 million business?

David Ciccarelli is the co-founder of Voices.com which is the online marketplace that connects business people with professional voice over talent.

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Intro: Hello everybody and welcome to the Success Harbor Podcast with George Meszaros, where it’s all about making success happen for you.

Success Harbor: Hi Everyone, this is George Meszaros with Success Harbor and I have David Ciccarelli with me, he is the cofounder of Voices.com. Voices.com is the online marketplace that connects business people with professional voice over talent. Welcome.

David Ciccarelli: Hey George, thanks for having me. It’s great to be on the show today.

Success Harbor: Thank you for being here David. Tell me what gave you the idea to start voices.com?

David Ciccarelli: It’s a great story and I would love to share it with you. After graduating from school for audio recording where I learned how to record mix, edit, and produce music, in the classrooms where these mixing consoles that look like the verge of the Starship enterprise if you will. When I graduated I really kinda had the idea of starting my own small recording studio. That’s what I did and we’re in London, Ontario, Canada, about an hour outside of Toronto and after opening up the studio, I the local newspaper published an article about this new studio on my birthday of all days, and this is where it kinda gets interesting. You see, what I did not realize at the time is that my wife to be, who I get to meet of course, Stephanie, was a classically trained singer and musician and I was looking to record a demo. Because she would sing at weddings and special events, her mom came up with the idea apparently that rather than auditioning face to face for people and staying after church to sing a few songs for someone to see if it would be good for their wedding, why don’t you get a CD done where you can actually hand it out to people. So it was actually Stephanie’s mom who cut out the article in the newspaper and left it on her bed and she came in and we did these recordings together. Well because of that same thing, not only did I meet my wife Stephanie, because that same newspaper article, there were other small businesses in town; a local hair salon, there was an event management company and they wanted a female voice, one for a commercial on the radio and another one for their phone system. Because they wanted a female voice and of course I only knew one girl in the city I called Stephanie, I said do you think you could read this page of script for me and we will split the money? So we were officially in business together, but because we started out doing voice-overs on our own and we were modestly successful in London Ontario, we put up this website where we can market ourselves more broadly. Then taking one step and then another we actually started getting people that would contact us and go “well if you need somebody who speaks French, can I be on your website?”This other guy did character voices and if you need somebody in New York, I can I be on your website. Before you know it we had two dozen people on our website located all around the world. That was the proverbial aha! moment. Well if we’re doing this in London, Ontario, you know, clearly a global market, what if we could build an online marketplace for these services and get out of the production business ourselves and run this web platform where we connect businesses from Ad agencies, video production companies, game producers, audio book publishers with professional voice talent. These people have great voices, they either have a background in theater or maybe broadcasting and they were looking to leverage their skills and market themselves on the internet. So that’s exactly what we did, we sold the little recording equipment that we had at the time, hired our first web developer who built our first version of the website and went live with this idea of creating a community online where people could conduct business.

Success Harbor: So initially you grew organically pretty much or was there some strategy there?

David Ciccarelli: I didn’t go to school for business, other than having it in my blood, I think I was the kid that was always begging his parents for garage sales and lemonade stands and trading hockey cards. Truth be told, I don’t think we had a whole marketing strategy around growing the business, so it certainly was very organic. One of the tactical things that we did in order to acquire the first group of users, you need to certainly inform your audience, whoever it may be and we did that by going through the Yahoo Directory. The Yahoo Directory at the time – we’re going back to 2004 here- was these nicely organized listings handpicked, editorially picked good websites, people would have businesses in that particular vertical market. The Yahoo Directory still exists today but what we did back then was that we literally went through website by website, very logical and methodical order and just invited people to sign up and we did that both on the voice talent side of the market, so call that the supply side of the marketplace or service providers and then the demand side where there were clients looking to hire the talent. We did the same thing, where we went down a list of advertising agencies and video production companies and just said “hey if you’re ever looking for a voice for your next video then consider using Voices.com. I should mention George if I may, we didn’t actually start as Voices.com, the name of the company was Interactive Voices, so it’s a bit of a multiple. Can I share a quick story of how we got the domain name?

Success Harbor: Yes, I was gonna mention that it’s a great domain and I was gonna ask you if this was the first idea that came to mind? Please do share. It’s an awesome domain, it’s as good as it gets right?

David Ciccarelli: We know for sure because that’s what we do in a single word. As I mentioned, we started as interactivevoices.com so it’s a bit of a mouthful and your profile would have been george.interactivevoices,com. We had probably about ten thousand people using the site at the time and this was at the height of the web to porno movement, Flicker got started and Twitter and all these companies are cropping the vowels on their names in bright bubbly colors. It got me thinking, Interactivevoices is this long name, literally people were complaining that they tired of typing it out so much and they didn’t know if it was singular or plural or if we only did interactive or new videos so it kind of pigeonholed us a bit. So I was on a bit of a quest to change the name and I actually put in a bid for $100,000 for vox.com and that didn’t go through. I looked at voxio and voxi and all these other variations on that and nothing was really quite working well. I realized that maybe it’s not the whole name change and the rebranding but rather what if we could just chop up the interactive part and just keep voices.com. So I did what probably many of you have done, just go to your address bar or go to Google and you type in a domain and what came up was a medical journal came called “Silencing the Critical Voices in Your Head”, so it’s this psychology paper about positive self talk and it probably had a thousand entries or so, hadn’t been updated since the year 2000 and was originally registered in 1998. So a very old, well established domain name. Well the good news is that at least it wasn’t A T &T selling telecommunications equipment or Voices the movie or something along those lines but I did realize George, if I had been the one [email protected] emailing this other guy, asking, “I did the Whois look up to see who is the registered user/owner of any domain. When I did that look up, I realized that if I email them from my interactive.com email address, you’d probably put one and one together, may go to the website and realize that hey, he’s got this little business going on and probably increase the prices, jack them up a bit ‘cuz there’s clearly a business opportunity here. So I realized that literally the same week, that a lawyer moved into the office across the hall from me in this kind of tech incubator space that we were working from at the time and I said hey do you think you could you send this guy an email on my behalf and just ask him would he would sell the domain name if so what price? So he comes back and says he would sell the domain name for $50,000 and I’m thinking it’s good that I didn’t spend a hundred grand on the other name because this is actually a better one. But like many entrepreneurs starting out, we certainly didn’t have $50,000 lying around. So I went to banks and tried to explain this to them and they’re like “huh, you’re building a new website, is that’s what’s going on? And I’m like, no it’s just the domain name. I don’t know if it was the Superbowl but they were convinced you could just go to GoDaddy and get these for $9.99 and I’m like, no its a premium domain name, they’re all registered, you have to buy it from somebody else. So being pretty disheartened ‘cuz I got rejected by everybody I pitched this idea to, the lawyer taught me an important lesson, basically never take no for an answer, negotiate. So go back to the fellow and say well, don’t lowball him out and offer him half or less than half, why don’t you say $30,000. So George, with $5,000 I still don’t have $30,000. He goes, let’s see if we can come up with something creative, maybe I can send him $5000 a quarter for the next six quarters, kind of maybe do this financing deal and you know what? He went for the deal. So George for $5,000, we were able to charge to the corporate credit card, we were able to obtain the name voices.com and then transition the business, if I can recall correctly, over in less than 30days, that’s for sure. As soon as I got it, I was like wow, it’s amazing let’s start marketing under the new name. So we literally cut out a copy of the entire domain, all the data on one server to another server that had the new registered voices.com domain name and just pointed all the traffic to it and it was just an address redirection and you know, we were in business in a matter of weeks and people were really impressed, they were like wow, how’d you get this name? We love it and it’s a brand that we can rally behind. Looking back, what I think is it was one of the best business decisions that we have ever made. It was also probably one the more risky ones, and I’m certainly not a betting man by any stretch of myself but I would call that more of a calculated risk, one of those things where you figure, is this gonna be good for the long term? And I truly felt it was and saw the value in creating a brand identity that people would want to be a part of.

Success Harbor: Just so we get an idea, what year was this when you bought this domain?

David Ciccarelli: 2007.

Success Harbor: 2007, so you have been in business in for about 3 years approximately? So we get an idea because this is $30,000, even though it’s quarterly payments of $5000, so still a lot of money. Give us an idea what was the size of the business then because sometimes people don’t wanna invest any money in their business. So we get kind of a feel for it, like how many clients maybe you had and things like that.

David Ciccarelli: Total registered users was about 10,000 probably paying clients, so it’s kinda was like a free mail model, of course with any web business you get a bunch of people to sign up free and maybe 5, 10, 15% of of persons will actually purchase. I think we probably had about less than 500 paying customers if you will but in a year our revenues, if I’m getting this correct, was probably around $250,000.00. You kind of bake that in, it’s pretty close to 20% of our revenues, let alone all the expenses that go with running a company, went on this single play.

Success Harbor: That’s a huge chunk of your revenues. It wasn’t a small risk, even today it’s is easy to say that you already had a lot of users even if it’s only 5 to 10 % of 10,000 users but still it was harsh for you go wrong with that kind of domain name.

David Ciccarelli: We had validated the market, which I think was excellent thing to do. My advice to a lot of people that are considering starting a business or even branching out into a different area, is just start with a no tech or low tech solution which often can just be a lot of conversations, kind of surveying people if you will, informally. Nowadays you can register a domain name and install Word Press and even buy a premium Word Press theme all for under 200 bucks, it’s ridiculous, if want to test out an idea, buy some traffic from Google, spend 500 bucks for getting traffic. It may seem like wow, almost a thousand dollars to test out a business idea, well think of years ago big organizations and even small companies are spending tens of thousands if not hundreds of thousands of dollars just to test out an idea, where you can get a pretty good feel for, are people clicking on my ads? Are they staying on my website? Are they filling out my requests for more information form on this little email form? There are a lot of simple steps that you can take to rapidly test out an idea and then decide if it’s worth investing further.

Success Harbor: So we’ve been talking about your business and how you started for a while and I have to say your site is very addictive, I ended up listening to way too many samples.

David Ciccarelli: Sounds like me on the weekend, the kids love listening to the voice talent in other languages. I think it’s a bit of an eye opener for them.

Success Harbor: You get all the accents and everything. But very quickly, can you give our audience and idea of what voices.com is and why would somebody use it?

David Ciccarelli: Sure. Again we refer to voices.com as a marketplace. It’s a place where you would go to hire a voice actor for maybe your business phone system or you’re producing a Youtube video or a commercial and you want somebody to have that professional sound that’s gonna be your audio ambassador if you will, the voice or sound of your brand and so these are people who are great story tellers, not everything has to sound like a commercial, you can have people that sound very natural and they’re actors. So those are some of the most common uses of Voices.com, is to come and listen to a bunch of people and ultimately when you find somebody that you like, you can request a quote from them by describing your project and then they all submit back a price quote and then you pay us by credit card through the website and in return you’re gonna your Word document which would be read out into an audio file and you get those audio files back, delivered to you through the platform. So it’s kind of an end to end. I think, probably if I may, that the biggest wow factor is the speed at which people return the files to you, is typically within 24 to 48 hours, obviously depending on the size and scope of the recording. Trying our new ideas for different radio commercials or I want a different voice for your video, these are things that literally hundreds of these projects are happening everyday and it just amazing to see the level of engagement with the community.

Success Harbor: Is there like an average price for someone to have a new commercial created for their business? For example, I listen to a lot of car commercials and all that, you know, business commercials. Is there some rule of thumb, I’m sure there’s a lot of variables there but can you give us an idea?

David Ciccarelli: Ya, for sure, we measure the average transaction size for all these deals that are going through the site, typically it ranges around the $250 mark. Let’s call it a page or two of script, which is probably between 30 and 60 seconds or your entire phone system; press one for this, press two for that, your “on hold” message. That would fit within a couple pages of scripts for around the $250 mark. For those that are interested, could Google voices.com rates and there’s a whole rate sheet that we have it all broken down into the different uses and that was developed by serving our customers and also factoring actual transactions we see on our platform. So voices.com rates is kind of good place to go and see what the prices, the going rate is for different kinds of recordings.

Success Harbor: Now that makes sense because I think sometimes people have no idea so at least this will give some kind of guidance for them.

David Ciccarelli: Exactly. We not trying suggest that the market is a certain way, it’s just that we have this unique position of seeing all the data flowing through the platform that we figured it was probably going to be more helpful because if people think it’s like a thousand bucks or five thousand bucks, it does not have to be that. I mean, maybe some people do charge that but there are certainly a lot of professionals that are really quite reasonable that are happy to work with you and establish a longer term business relationship.

Success Harbor: You manage to build a market place, which you mentioned several times, which I always think is incredibly difficult, because you basically have two customers. We know their businesses, we just have to worry about getting one customer but for you to be successful, you have to do twice as much. So what did you do right to make this a successful, to be able to create a successful market place?

David Ciccarelli: I’m really glad you pointed that out because it’s something that’s very underappreciated to be honest and that’s how we view it. It’s two distinct customer groups who often have opposing needs and desires. So think about this for a second, you have the client who wants things as quickly as possible and still wants it to sound very high quality, professional but I wanna pay the minimal amount possible. Then you have on the other end of the market place, the voice talent who wanna work with best clients, have the best relationships and they want to make the most money. It’s kind of opposing forces. So, by us serving as that trusted intermediary, has been our approach, we don’t necessarily quote on quote work for any party over the other but rather we operate the platform. There is certainly a chicken and egg type problem here, which is what came in first? In our situation we actually built up and marketed the voice talent on the website first, as I said, they were coming to us and we were, back in the day, had coding HTML profiles for these voice actors and then we set about trying to find them work and trying to find clients that maybe would wanna hire them. What did we got right? I think that right from day one because not only Stephanie and I co-founders in the company, we are also as husband and wife. We live, breathe, eat and sleep this business all day long. But one of the things we did right off the bat was we literally had a piece of paper that we drew a line down the middle, and we said, here’s your area of responsibility and here’s my area of responsibility. Broadly speaking, Stephanie works with the voice talent, the coaches, the educational facilities and the agents and that’s all her area of the business and then mine is on the clients side, so working with the enterprises , government agencies and educational institutions and so forth to bring their jobs on to the platform. I couldn’t imagine running a business as a solo entrepreneur, I think that would be tremendously difficult. As in any business as you may know, you need to surround yourself with great people but I think from the beginning we had these dual tracks going on. Even to this day when you visit the homepage of voices.com, you will see that there is a green box and a blue box and we try to separate people, new visitors down these different paths depending on what category they fall into. The whole story and all the words we use in the calls to action and the buttons that lead to sign up forms, they’re all distinct, whether you are a client or a voice talent. That line of thinking of service two customer groups has been in our DNA since the very beginning.

Success Harbor: Now 10 years, you’ve been in business approximately and its a huge accomplishment when you look at all the statistics and you managed to build a successful business. How would compare your challenges from earlier on to the challenges of today and dealing with those challenges, can you talk about that a little bit?

David Ciccarelli: They are a lot of the same things, it’s hiring a team of people, defining roles and responsibilities and knowing who is doing what, communicating who is doing what and if there’s a need, then hiring somebody new for that position. Well certainly you should be able financially support them which is a big responsibility and so those are the same challenges that we had from the earliest days to now. I have always built the business, this might sound funny, really to engineer myself out of the process and thinking in terms of the systems. If we’re gonna bother doing something once and we can imagine ourselves doing it maybe 10, 20 times, I’m probably gonna figure out if there’s a system to do this, whether it starts just as a spreadsheet or maybe it’s a customer relationship management system like salesforce.com or Zoho, so they’re a lot of other systems on the market, but looking at ways on how to standardize a process and then improve it over time. So taking this continuous improvement type approach and that just comes because you hit a brick wall and realize; what’s the challenge here? Why do we keep running into this? Can we reset our thinking or take a completely different approach? If we were start this process from scratch, having none of the emotional or mental baggage or no ties to our current way of business. If we were to start this from scratch, how would we do it? We’ve taken that approach a few times and came up with brand new solutions to a particular problem. So I think it’s a lot of the same stuff, as they say, both your people, your product and the 3rd “P” would be your process.

Success Harbor: Its 2014 . Can you give us an idea 10 years into the business what is the size of voices.com in terms of people, customers and I don’t know if you can share any revenue numbers.

David Ciccarelli: Sure. Back in the day we’re talking first year was just trying to get our first hundred people was our target, then it was the first thousand, today we’re at a quarter million, so 250,000 users with 45 staff that are here. So, again it’s a pretty sizable team. Revenues are certainly in the double digits of millions in terms of gross revenue. It’s so shocking to me because I remember when we were just trying to get our first hundred dollars. It’s a lot of small decisions that were made correctly over the year and being willing to undo a decision if it was a bad on and just take one day at a time, it’s a long, slow process and I think many entrepreneurs get impatient and frustrated but we didn’t have any secret sauce, if there was one, it was persistence. We stuck to one idea and we stuck to it for ten years and the idea was a market place for voice-overs and we didn’t change that in ten years. It’s been more or less the same business the whole time. Other market dynamics have changed, people on our team have come and gone, the industry landscape has changed but we’ve just stuck to this one idea. I think if entrepreneurs out there can do that, they will be a lot more successful than constantly chasing the next best thing and then their revenue models are always changing. So stick to one thing and see it all the way through.

Success Harbor: So far it sounds almost like a walk in the park and I know it wasn’t and you’re not trying to say it was but I want to hear maybe a big mistake or a big challenge that was a really great learning experience for you.

David Ciccarelli: I think probably the biggest one was around a time when we had the financial crisis in the US and we are base in Canada and at first you would think it didn’t had a whole lot to do with us but our credit card processors, the company that runs our credit card systems for us, was actually an American company. They had a Canadian subsidiary, initially when we filled out the application when we started the company to open up a credit card account; they asked us what’s your annual revenues. I don’t know, it would be amazing if we made $30,000 a year, maybe $3,000 a month, $36,000 a year. So we jotted that down on the application and then they asked us what’s our average transaction size we said we haven’t really sold anything yet so we just put zero on the application. Well 4, 5 years go by and the financial crisis happens and this company is reviewing all of their accounts and we came up for because there had been an issue of a few instances of fraudulent transactions using a stolen credit card over the internet and they had told us that we were 17 times outside of their risk profile and that they would be effectively shutting our credit card system down immediately. I said look you’re pretty much gonna be putting us out of business, this is completely unreasonable. They said ok, well we’ll give you 30 days and we’re gonna stop depositing funds into your account, we’re gonna give you 30 days to find a new processor. So think of that from our position we had at the time about 2,500 credit cards encrypted on file, so it’s not like it was an easy switch. We had to go find a new provider and come up with the security deposit and still keep the whole business running all within this 30 days and then switch all of our customers over by obtaining new credit card information from them for upcoming subscriptions and other kinds of transactions that we were running. That was just a really difficult time because truthfully we had very little cash coming into the company because we had no means of processing it and the need to continue operations. I think that taught me an important lesson that you need to keep a cash reserve, it’s common advice in your personal life, like a 3 to 6 month window of having some cash on hand. That was the lesson there, was to basically take that same approach in business, you really need to have that cash reserve; the war chest as sometimes it’s referred to, in your company so that when the inevitable rainy day or storm more like it, comes that you can ride through it. That was just a difficult time that we made it through and I think learned those tough lessons and we’re stronger for it.

Success Harbor: I just have a couple more questions. One is, you build a successful business and some people say they is no more opportunities out there or there is just way too much competition for me to succeed. So, you as somebody who has done it, do you see opportunities today in business even in this weak economy that we are going through right now?

David Ciccarelli: Yes. Definitely there are two ways that you can find the next great idea. One is to find whatever that passion is for you and figure out how to monetize that. That’s what Stephanie and I did, I was an audio guy, I started my own studio and built the hourly rate of $30 an hour in this little studio I started. Stephanie charged a modest amount to go around and sing at weddings and get honorariums for singing at special events and so forth. So those are both passions that we had and they evolved overtime into a marketplace that was ultimately scalable. Those are things that both of us really enjoyed ever since we were kinds, I always liked the record player and short wave radios and I was into the “tech”. A lot of aspiring entrepreneurs certainly need to reflect and what they were like in school and what kind of things did they like doing? So that’s one place to find good ideas. The other one is honestly to observe the world around you and find something that just annoys you because if it annoys you, then there’s probably a whole bunch of other people who it annoys as well. If it’s a better key ring system that you can color code your keys so that it’s easier to spot on your keychain. Or you’re at lunch and the ketchup bottle was not putting out any ketchup and you had to shake it up 20 times, is there a better ketchup bottle that could be created? Find a way to scratch your own itch as the saying goes. I think those are two ways that you could find a business and it doesn’t have to be one of those high tech web businesses at the beginning, sometimes you can figure things out offline and then making the leap online, that’s when things really start to get interesting. You can validate whatever your idea is without hardly spending any money. My wife is kind of annoyed anywhere, I will read people’s name tags and I’ll say “Oh Julie, have you ever heard of those people on commercials that do the voices, what do you think they’re called?” Because I’m just trying to see what people think that these kinda people are called and they’re like, a narrator or an announcer and I’ll say oh that’s interesting. You know I’ll just strike up conversations with the folks at the gas bartending or the receptionist, pretty much anywhere we go because I’m just constantly in that sponge mode of trying to ask questions and then get some feedback. It’s a great mindset that’s conducive to lifelong learning.

Success Harbor: If someone came to you, maybe a best friend or somebody in your family that has a job now but they see your success in business, and they say David you know what? I really want to succeed. What would be the first thing you would teach them about being an entrepreneur?

David Ciccarelli: I was just out to lunch with someone and we were talking about this, I asked the fellow, have you ever thought about starting your own company? He was like, oh interesting you asked, that’s why I wanted to go to lunch with you and we got into a whole conversation and we talked about some of the ideas and I said whatever it is, just take the next step. What is the next step? Take that next step whatever it is, if it’s registering a business name, if it’s maybe registering a domain name. Taking some kind of tangible step that starts to make it become a reality. Maybe it’s a fictitious business name at the outset but you start a business plan or you get everything down on paper. Not some hundred pages full of charts and graphs, I’m just talking about more like an action plan, what am I gonna do in the next 12 months to move in this direction. It really comes down to action. There are a lot of people with a lot of great ideas but they never take that next step to just doing something tangible. I think if you do that, they you’re gonna see even some small successes and it’s gonna give you the confidence to make that next step, whatever that may be.

Success Harbor: So where do you see Voices in the next 5 years, what is your ultimate goal? If you could draw the perfect voices.com as a business, what would it look like?

David Ciccarelli: When we think about this kind of question, it really is in a line with what we view our strategy is to be. It’s two words and it might sound very corny but it comes down to this; we really do want to dominate the industry. Meaning, be that kind of dominant player for good but the one that everyone thinks voice-overs is synonymous with, like oh ya I go to voices.com for that. So that means speaking to every potential customer that’s out there, having every single voice talent that practices the art and craft of voice acting, they should be on the platform as well. It’s having that omnipresence is really what we’re aiming for. The by-products of that are executing this strategy across global boundaries by having a multilingual site and being in different countries around the world. Making sure everything is mobile enabled; that’s our mobile apps, that’s the response of design, the dynamic nature of our website that works equally well across desktop, tablet and mobile phones. So it’s these kinds of strategic initiatives. If industry domination is where we’re trying to go, what does that mean? It means we have to be in as many countries and as many languages or on every device and talking to every single customer that we possibly can. That’s the big vision and it may not be 5 years, it may be another 10 years but i think we will get there.

Success Harbor: Well David, I really appreciate you taking the time. How can people connect with you?

David Ciccarelli: Certainly, i would love to carry on the conversation via email if you just email [email protected] that would get right to me. Also if you just wanted to poke around the website and listen to our own podcast or download some of the other resources that are available then voices.com is a great place to go.

Success Harbor: David Ciccarelli, cofounder of voices.com, thank you and I wish you much success in the next 1o years.

David Ciccarelli: Thanks George. Bye.