Pocket has sold 300,000 AI recording devices by focusing on field workers who need a dedicated recorder, not a phone substitute

Speaker 2: is the most simple. Lindy. Straightforward. Yeah. It's true. Well, we have Akshay from Pocket. He has sold over 200,000 of these devices. What's going on? You what they look like on the screen. Welcome to the show, Akshay. How are doing?

Speaker 10: Hey, John. Hey, Jordy. How are you guys doing? We're doing good. It's great to be in TBPN.

Speaker 2: I'm glad to have you here. Yep. Now we we we started

Speaker 1: hearing and learn learning about your company probably a year ago at this point. We're like, what's this company that's just selling a lot of hardware? Yeah. Somewhat somewhat under the radar. I'm sure it doesn't feel like that to you, but you guys haven't really chased

Speaker 2: the spotlight as much as other companies that sell hardware that haven't sold any hardware. Yeah. I mean, the phrase in Silicon Valley is hardware is hard. Don't go after it. It feels like AI has unlocked new opportunities both in there's demand for new devices, and then there's also AI that you can ask to help you procure things and help you design things. But what has the road to actually building the first device then scaling to 200,000 devices been like for you?

Speaker 10: Yeah. So interestingly, we we actually built an app before we actually built the hardware. Yeah. And the simple thing was that, hey, it's the most obvious thing to do. It's the most easiest thing to scale. So let's just go build an app. And we built a meeting note taker app and we released it to a bunch of people and there was not a lot of response. Being surprised, we thought to ourselves, hey, what about that device that we were all thinking about that we should go do, that'll be like a necklace? And that's kind of what we did with open source work at Omi. We went and did a bunch of Kickstarters, and we printed a bunch of these devices and gave it to people. And we actually saw that people were using the device 10 times more than the app. There were a couple of other challenges regarding being always on and being available. So when I started Pocket, my first immediate thought was this should not be always on. People are still not comfortable. There's still dialogue that needs to happen before, always on wearable becomes a thing. And we said, let's go build something that's available for a phone. There so the people in Wall Street are happy to use it, and it doesn't augment their style of, their suits and coats that they wear.

Speaker 2: That's interesting. Kind of where Pocket came around. That's very cool. So, yeah, walk me through the current product specs, price point, what the favorite features are, sort of like how you think about where you are now and then where you wanna go.

Speaker 10: So currently, this this is Pocket, and this retails for $129. The hardware comes with a freemium subscription, so you kind of get to do unlimited summaries, unlimited transcripts. You get three messages you can ask about your conversations per day. Mhmm. If you would want more, like speaker tagging, advanced speaker recognition, all these kinds of things, and advanced AI models for reasoning and summary agents that can make better details out of your summaries and have access to 300 plus professionally sourced templates like SOAP notes for doctors Oh, interesting. For lawyers and CRM entries for salespeople. You can get on our pro plan for $20 a month or $200 per year. And that's kind of the whole product basically.

Speaker 1: Health So care the thing that stands out to me is like you launched the initial app, you're not seeing the kind of growth that that you wanted to see. And so then you're thinking, okay, we should launch the solution is to launch a hardware device. Let's turn up the try to accelerate. To Normally the normally you think like, okay, the product's not working. Add a hardware thing that functionally does a lot of It's the same probably not necessarily gonna I don't know. My my intuition would be that it wouldn't solve the problem, but I I keep coming like, what is why why does it make sense for this to be a separate device from the phone? Because I'm sure, you know, if you met with investors, a lot of investors would be like, well, I have a device that's a hardware device. It has battery. It has a microphone. Yeah. It has a screen. It has all these things. So why are your 200,000 plus customers saying, no, I want this I want this separate device, because, like, clearly the customers are right.

Speaker 10: Yeah. Absolutely. It's 300,000 now.

Speaker 2: We gotta hit that. Alright.

Speaker 10: So so when when we actually went and asked these people, like, hey. Why are you using this 10 times more more than more than the app that we had? Yeah. We actually had one of the user who was actually using a different phone he just bought for recording conversations. Woah. And he also had a battery attached to the phone on top. Sure. So that's kind of what Pocket ended up being a product by just watching how people use these recording apps on the phone. There are a lot of limiting factors for recording on the phone. A, you cannot record your own Zoom meetings in Google Meet if you're already on the phone. You cannot start Oh, that's right. Not recording. So there are a lot of people who have issue with that, and there are people who get incoming phone calls all time. So if you're recording something and you get an incoming phone call, it it it interrupts the recording. Sure. And if you take the phone, your recording is stopping essentially.

Speaker 1: Mhmm.

Speaker 10: Apart from all of these technical reasons, the the real reason is actually that the people who take ten, fifteen meetings a day, these doctors, consultants, are like, patient goes out and their patient comes in, the client goes out and their client comes in, and there's 10 to 15 back to back meetings, they feel awkward in the first eight seconds to take their phone and start a recording by unlocking their iPhone and setting up the recording hoping so that the operating system doesn't kill background running apps for a long time. So people just felt that this is much more reliable thing, a quick access thing that can immediately start recording, and I don't need to feel awkward on placing it on a desk. So people don't take take their attention. Why is this guy looking at his phone? We just met. Yeah. So that's kind of what we came around that, you know, convenience beats intentions. So if your users have intention to record and you don't make it convenient enough, they will not record. But if you actually make it convenient enough to record, and they wanna record even a little bit, they'll 100% record.

Speaker 1: Interesting. Should more people be taking notes with and and and recording their conversations? Oh, yeah. Because I haven't recorded a conversation in years. Yeah. But what am I what am I missing? Yeah. Absolutely. I think, like, there are I guess I've lot recorded recorded hundreds of hours of conversations through the show. So yeah, we have people recording,

Speaker 10: you know, tens of conversations almost daily. And and most of these people are actually field workers, you know, consultants, salespeople, real estate agents who are showing people's, you know, homes that noting down requirements, places where note taking is actually, you know, useful. So for example, DoorDash is one of our customers. They use Pocket to go to restaurants for for the salespeople to record their pitches and then come back to their HQ and sync with everybody else in in a knowledge base of, hey. How did my pitch go with with this vendor, with with that restaurant owner? So I think, like, there's there's definitely, like, a use case for field note taking, and that's kind of where Pocket comes and sits in. But but, yeah, I think, like, in a broader sense, your AI needs a lot of context about you to help you. Yeah. And every single time you essentially use Pocket, you can connect your Plot, MCP, or OpenAI's API, and your your ChatGPT already knows about all your conversations. And and you can you can pretty much manipulate all your transcripts and and and and and understand how people are talking to you and and all these cues. For example, if you go to, you know, VC meeting, the VC says a 100 other things. Like, it actually sounds so interested. Like, I felt they almost invested in the startup, but they never said the word invest. Yeah.

Speaker 2: So the founds are going back thinking, oh, I have a term sheet or something, but the truth was it was just a high. Yeah. No. No. I've I've seen that play out where someone comes away and they say, oh, yeah. This VC said they're gonna invest. They tell it to another VC. They call each other. I didn't say that.

Speaker 1: And it becomes Yeah. Who said Are you are you broadly bullish on new AI hardware? Because I think one of the reasons that people have been generally bearish is you've had, you know, you had the rabbit, you've had friend, you've had a bunch of these shots and attempts that Humane. Humane. Yeah. So there's been a there's been a handful that that haven't got the level of traction that you have had, but given your experience so far, do you think there's a lot more devices to build that are AI native in the real world? Mhmm.

Speaker 10: I think so. And I think, like, you know, Rabbit and Humane died so, you know, Pocket could live. Mhmm. And we learned a lot from all these other devices that essentially died, and they primarily died because they were trying to replace the whole smartphone game. Doing too much for sure. Too much too much of stuff. Yeah. Yeah. Exactly. And and they were act actually just going against going towards real world works. The way that the workflows work for real people. They don't want all the other things like ordering Uber Eats from AI. All they want is that AI to fit in their existing workflows. And what we did was we looked at a lot of people, had a lot of meetings, and we didn't go into things like personal note taking, for example. All these others are dead, basically.

Speaker 2: Whoever went and did anything other than note taking. And note taking was essentially a product market fit. It was almost like fitness for for Apple Watch kind of product market fit. Yeah. And everything else was basically like people didn't want them. Yeah. Yeah. I when I saw Rabbit r one, I never got a chance to actually use it, but I was thinking, like, it's so it's such a beautiful design. I thought it would be perfect for kids where if they're just going around taking some photos and learning a little bit about the world. And I actually wound up buying a different product that's a circular device with a screen and a camera on it, and it has little games where the kid can go and say he'll say, like, find something flat. Find something round, and they'll go and find it. And then, that other company sticker box that we've had on the show is doing really well in what I would call AI hardware. But you push the button, you say a prompt, and then it prints a cartoon for the kid, and it makes a little sticker. And it's these, like, very focused things that have it's just do you want this at this price? It'll do this for you. It makes a lot of sense. What are you doing or what do you need to do on the regulatory side? Because I imagine if it has a radio in it, needs FCC approval, but you mentioned the medical discipline and HIPAA, is that relevant How to have you solved that problem?

Speaker 10: Yeah. So, we're HIPAA compliant and we essentially have HIPAA compliant servers that we run HIPAA workloads on specifically for From medical use day one, we thought about being HIPAA compliant and SOC two compliant for enterprise as well. FCC is definitely like, if you're making a device with Bluetooth radio, you pretty much need FCC, so from day one, you would need that as well. So, yeah, in terms of consent is what comes up most of the time these kind of recording devices. We did with Pocket was we said, we would like to bring the risk level down to almost a user action. So everything happens with with a user action. So you're supposed to, like, tap a button to start and stop recording. Mhmm. Although it might be a a friction step to to do to this, but we would love for the user action to be the risk level where we are for Pocket. So everything starts with the consent of the user. At least it starts with one party, one state consent, then, you know, it's on the user to basically ask for, you know, other people's consent. And and surprisingly not that people actually are very open when you actually ask them to to record. Sure. And and they're actually happy that you would share the transcript and the meeting notes of recording. Sure. Sure.

Speaker 1: Do you think you'll ever launch something like a coworker, agent, or or assistant functionality? Is is that because because I imagine if you can give your device a bunch of context, hey, I wanna do this thing, eventually, it could get to the point where you can send off tasks in the background that the user can check on maybe on their mobile device.

Speaker 10: Yeah. So so that's actually our own road map in the next three months that we would actually like to build agents that would actually take context directly from from your conversations and actually act on those. Make make reports, make docs, PPTs, presentations, slides, all kinds of things from from your meetings. So this this is, like, increasingly becoming, like, the regular workflow from all kinds of consultant sales pitches that people take the conversation and make slides out of them Yeah. And and come back for the next meeting. So we would love to make an interface for that, so in the next few months. How do you think about picking

Speaker 2: different AI models for various pieces of the of the workflow? Because I can imagine that you're you're selling something pretty valuable, so cost might not be the the most important thing. At the same time, you can just wait and things get cheaper often. Switching from one model to another might inject, like, a different flavor or vibe sometimes. So how have you thought about this? Are you fine tuning your own models using open source, bouncing bouncing back and forth between whatever frontier models are available? What's your decision criteria right now?

Speaker 10: So surprisingly, we have the highest margins in subscription industry for AI. I can imagine. Roughly 5% margin in in software subscriptions, essentially. So we we we do this with with different kinds of routing.

Speaker 2: Yeah. Oh, yeah. Oh, okay.

Speaker 10: Yeah. So we we have our own version of OpenRouter where we essentially route to different kinds of providers and models. Okay. We use a section of open source for transcription. Sure. Because people love to choose what model they would like to use for summarization.

Speaker 2: Oh, they do? Okay.

Speaker 10: Yeah. Yeah. So so so transcription is pretty much left to us. So so we we we do it on ourselves. So that's kind of why our our margins are super high because we get to use whatever we like, and we use our own models that are fine tuned on top of OpenAI's Whisper, because a lot of this online models were trained or YouTube datasets like Waxella, which are extremely clean datasets and work really well for Zoom meetings and meetings of online note takers. But when you come for offline, there's a train going next to you. There's Oh, interesting. Bunch of things happening. So they they actually go go go crazy when when there's, like, an offline recording. So we need to fine tune for them to work for, you know, offline recordings, essentially.

Speaker 2: That makes a lot of sense. Thank you so much for coming on the show. I feel very cool. That I am a a featured customer on the Zapier blog from 2015 because I developed a workflow that would record all of our conference calls, send them to a human transcription service, and then upload the transcription into Google Drive. And then you could search by keyword just using Google Drive search. No. Nowhere near the power level now. But I would tell And interestingly, Y Combinator actually currently uses Pocket to record all their interviews. Oh, really? And Cool. And send them to their online systems through our APIs. There you go. So yeah. Very cool. Something particular. Well, congratulations on the progress. Great to meet you. Thank you so much for coming on and breaking it down. Love the approach. Have a great rest of your day. We'll talk to you soon. Thank you, Thank you, John. Let me tell everyone about Railway. Railway is the all in one intelligent cloud provider. Use your favorite agent to deploy web app servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security. Who we got next? Our next guest is Hari from Aura. He's the founder and CEO