If You Want to Grow Your Business Fast, Watch This About AI | Alon Peleg, COO aiOla (Podcast 464)

If I would tell them exactly A to Z what they need to do every morning, they will never want to stay in this company if I will tell them, hey, this is where we want to be. We want to be the leading AI, the conversational AI solution for enterprise. Now tell me what I need to do.

All right. Our guest today is Elon Peleg. And Elon is an amazing leader from Israel. He, he's a proven leader with over 20 years experience growing companies and leading teams in fast moving technology markets. He really knows how to scale companies, he knows how to build strong teams and he leads big changes that stick whether it's startups or Fortune 500 giants that he's worked with. Today he's the COO of Aola which is a cutting edge conversational AI company. He's in charge of building the right team, driving their go to market strategy and scaling operations. And this is not just a technology like Siri or Alexa. Very different, very specific, very niche, but also very big. And under their leadership, Aola's AI powered voice tech is already making big impact at Fortune 500 companies, helping them work faster, automate more and get better data. His goal is to make AOLA a top player in the space while keeping the company running smoothly for long term growth. Before aola, he built WIX Enterprise from the ground up, growing it to hundreds of customers and prior to that worked at Cisco where he led a team with some of the biggest service providers in the world. You'll love this episode. You can also watch all of our Second in Command podcasts on our YouTube channel. We'll see you on the inside. So Alon, welcome to the Second in Command podcast.

Hi. Thank you for inviting me. I'm very excited to meet you.

Of course, really excited to meet you as well as you and I said just before we hopped on the podcast, you're from Israel to one of my favorite places on the planet. It was one of the first countries that I was able to travel to and I was backpacking around the world 40 years ago and now my wife have become nomads four years ago and we live on the road traveling and Israel still ranks in, in the 80 countries I've been to, it still ranks in probably the top five of one of the most magical places I've ever been. So thank you for joining us from Tel Aviv or from Haifa. New Tel Aviv.

Yes, it's amazing place with so much to learn and see in such a small country.

It is, it's a wonderful country, incredible people, beautiful food. I remember when I was first there in 1995. I was living on a kibbutz down at Ein Gedi and I landed like the Ritz Carlton of kibbutzes. I was on a spa, they ran a spa on a date farm. So I had it pretty cushy. But I remember walking into the cafeteria the first day and trying all this food and going like wow, this is like falafel. I didn't. I. We grew up in north a small town in Canada. So anyway, my mind was blown. Tell me about about aola. You are the COO of a company called aola. I'm going to talk a lot about that, a lot about your past in getting there. But why don't you tell us a little bit about the company Aola so that we can start in from there.

Well, Aola is the o the best conversational AI lab today. And we have about 10 PhDs in a company of 55 people. It's a lot. And this team created about five patents around, around speech AI, conversational AI and, and, and I'm hearing from enterprises, from innovators in big enterprises that they didn't face any such technology with a big, even a bigger companies or $1 billion, call it competitions that available today in the market. And this reflects the energy we have in IOLA today. We have a team of very, very strong innovators who come to change the way industries interact with the machines with like we really believe that the main user interface in the next few years will become our natural interface, which is voice. And the technology today is allowing that something that was unbelievable. No one really believes that it will. We will be able to develop a full conversational capabilities so accurate, so quick to react, so natural. And we are here, we like, we have something that is working and they provide value to employees that are in the manufacturing. Not high tech data scientists but we are providing solutions for employees in that doing inspections in manufacturing plants.

Well, and I feel like you're going to be right. I remember when my, my son is, my oldest son is now 24 and I remember when he was four years old and I said to his mom, we have to teach him how to type. He's going to be using computers his whole life. And then I walked into his room and he was sitting typing on a keyboard. I'm like how did you learn how to type? He said, well, it's right here. I'm like well, how did you learn where the letters are? He said, well, they're right here. I'm like forget it. I don't have to teach you how to type. And now he never typed, he just talks to his phone all day long. But we've even jumped past that where people are now even talking to the computer and teaching like coding by using voice as well. Can you give us some of the use cases and also can you speak to the complications related to accents? Because I know that AI is still struggling with accents and language.

Yes. So for example process of inspection is cross industry. It can be pharmaceutical or food industry, automotive, aviation or all of those industries has inspection processes in order to meet regulation and to meet safety. And you'll be surprised that many of them are still using papers and because this is how they did it for tens of years. So one, one main use case is to replace all old forms. Checking out cars, you know, every morning for car fleets and checking the production line every time you need to change the production product. So you need to make sure that everything is ready or quality control during the manufacturing. Everything can be paper based homes and and we are very easily replacing them with digital solution that is not standard. It's digital form when you are speaking any language, any accent with any background noise. Because it's not a. It's not your son sitting in his room right. It's people are standing next to him speaking machinery everything a lot of noise. And the form will be automatic like will will hear only the relevant sentences and data capture it and and send the data to backend system where a lot of analysis can be done to find trends to find you know, data that were never investigated before. So it's a lot of. It's not only filling the data faster, much more organized. It's the amount of data that will be Captured is time 5 Time 10 more than than you you had you could do it before. Now when you are going to to a manufacture like a car manufacturer plant in Asia or airport in US it's not only English. You will find there many accents, many, many nationalities that sometimes cannot even write in English. Now they can speak in their natural language. The data will be captured in English, the insight will be in English but the employees will speak in their natural language or exam.

Okay, so the complexity of what you're doing is pretty large. I mean I guess that speaks to the fact that you have 10 PhDs out of a team of 55 people. So you have 20% of your workforce are PhDs working on this issue. Who are your clients? Who do you sell to?

Ocean 500 it can be for one hand head of operations, COOs operational excellence head of quality assurance. That's one hand. On the other hand it can be the innovators in the companies like the CIO's chief of today. There are a lot of titles with AI. We we can provide two solutions. One is we can provide you an application. If you are jumping from paper to digital we can provide you the entire the application itself. The digital form that we will create only for you with the voice models that are only built for for you and Mr. Customer with for your flow is exactly we can build in a few hours digital phone plus the model the voice mode model that will be 95% accurate no matter which language, which accent, which net background node. That's one solution. Or if you are coming from more tech group I can provide you with APIs directly to our brain and then you you don't need to replace anything from your infrastructure. If you are using Salesforce or Max IBM Maximo you don't need to replace them. You will just add the voice widget to your existing ecosystem which makes it even. No one enjoy using those tools. If you are a technician you don't like to fill forms of Maximo and you so you don't need to you just use your iPhone speak and the Maximo form will be automatically filled in. Same for salespeople that had a great call in the event and they don't want to type into Salesforce all of their the summary they can just pick and the Salesforce form will be automatically captured which is ingenious. It's.

It sounds okay. So I have a few follow up questions here and I'm also. I'm kind of smiling and noticing you smiling. It's one of the reasons why I think so many people are starting to watch our podcast on our YouTube channel is they. They see some things that you don't necessarily. You know, you don't see it when you're listening. So I want to ask about a couple things that you smiled when you said them. I'm going to come back to those in a second. But I want to ask about the the complexity of the business or the simplicity of the business. I'm wondering is the complexity just in building out the tools but is it much easier to sell this than it is to build it like it. It feels like this is pretty simple to scale as an organization. It feels like this is actually a business that once you've built the tools you don't need 10,000 employees, do you to build a massive billion dollar multibillion dollar company.

This is not the challenge you Are right because there is. You can already imagine how big is the. Is the market right for us? Every enterprise almost needs even tech enterprises can replace like opening an IT case. I need a new computer or a need a new mouse. You can do it with voice instead of typing it. So the market is not the problem. But no one today, not many people. There are a few enterprises that are already thinking about it. No1 started 2025 when they had in their budget planning, hey, I want to add voice capabilities to my processes. So we need to find the change agent, the visionaries or the ones that are struggling to show them how much voice can help them capture unstructured data with the current processes and how fast they can adapt voice into their current processes without creating big changes in their current IT ecosystem. So the big challenge is to contact the right people in the right industries and with them be able to do the first step.

What are the big threats for your business?

The big threats always is competition. Today our advantage is that we are not boiling the ocean. I'm coming to a specific company in, in a few hours. I can build a speech model specifically for them and provide them 95% accuracy. You can go to the Googles of the world. They have enough money to do it, but they are not focusing on this segment at all. They want to boil the ocean. And they will not build a voice model specifically for an automotive company in Germany. They will never do that. It's. But if they want, they have the money to do that. And we are, we have the IP today to be able to develop solutions specifically to those industries.

Makes sense. So you're not trying to do a generic voice to text tool that's going to be used by all applications by Microsoft that Salesforce will just embed into their apps. You're doing something very specific for very specific industries. Is that why?

Yes. And it's so specific that, listen, if you'll take Siri for example, or Alexa and you'll try to implement what we did in an airline in US 50% of the world of the employees will not know it's a jargon specifically to that airline. And the advantage that we do, we learn the jargon in a matter of minutes and build a model that is specifically for you. And we will not train other companies with your data.

That, that's interesting. So all the jargon, all the acronyms, all the little. A lot of sense. So you're, you're literally taking their database, their, their lexicon, their dictionary and you're training a model around that for all of their forms and all their processes.

Exactly. So you have the jargon, the acoustic environment that is unique to this company because wow. You know, and the languages and the accent that is also together three factors that makes our solution unique.

Okay, that's super interesting. That makes a lot of sense. I want to go back and ask you about something. You said something about titles and you kind of smiled as you said it. You know, there's a lot of AI titles. Um, what are your thoughts around titles in companies these days? I'm not going to lead you specifically, but do you have any thoughts around. Around titles?

I think that I came from wix. You know the first WIX is very successful Israeli company. In weeks, for example, any employee can give himself any titles he wants. So that's created a different culture. No one fight about titles. And actually it took me time but actually it's a smart move now when I'm trying to contact today people in order to get some excitement around our solution. You can see that many executive got a title of AI because the company wants like part of their mission for next year was let's go into AI. It's great, good energy. I think it's. If you are not really understand or you don't have a vision of how, how you want to create value to your organization and just have a title. It's, it's. It's not. It will not move the needle.

And.

It'S not the title, it's the. I would say it's the interpreter. Like you need the energy to innovate. You. You need to continuously look for how to. How to do things differently. For us in a startup, this is what we do every day in a corporate that is larger, it's more difficult. It's more difficult because it's a big risk. If you'll make a few mistakes and you choose the wrong infrastructure and you'll create delays instead of accelerate, you'll probably lose your job. And there is a lot of culture and DNA in organizations that need to promote risk taking. The fact that okay, you did AAA for two years, it's about time to try another way not to stick for a. Although it looks safe, it's actually a big risk to continue just doing a. Because because of that was the routine till today.

So are you suggesting then that titles don't matter or that you see that companies are using titles as kind of a marketing tool and I'm curious, you know, if they don't matter, how do you work around the communication issues internally or how do you clarify for people internally when an organization scales and you know, there's hundreds of employees and they don't even know who to turn to.

So many titles are less important. I, I have example even in, in my startup where people impacting the, the go to market and the roadmap more than people with titles because of their talent and intelligence and accountability for the company. So for me personally, and I'm probably the more the older guy in the, in the startup, so people look at me and I assume they learn something. For me, titles are less important. It's more of which behavior I want to encourage in the team and how creative you are and how you succeed to impact the most critical activities in the company and that we increase your influence on where we go.

I guess there's like, there's a logical thought process behind that. Can you speak to hiring these, these 10 PhDs? I mean I've, I've hired, you know, smart people certainly inside of organizations. I've had to hire a head of engineering or a head of finance, you know, areas where I just don't have the technical acumen to even know whether they know their job. How do you hire PhDs that are so much smarter than we are? Are you a PhD yourself?

No.

Right. So, so how does someone you know in a CLO role hire these really, really smart people? What's the system or process that you use to hire people to know whether they really as good as, you know, what you need.

First of all, in the last year I hired the entire new management in Iola. Okay. My goal was to scale and hiring the PhDs is part of it, but it's only one part of it which is technology. But I wanted to hire the strongest cpto, both CTO and product visionary. When he came, he completely changed the way we looked on Iola roadmap and technology. I hired the strongest director of marketing because I knew that he will work the best with the CPTO abroad. Both of them are two key players that will be able to maximize the potential and will not be shy to change the way we work. I brought a very strong talent to lead our people the age r of the company which I knew that, that she will be able to, to lead a team of stars to the right direction without too much ego. And so overall same for the PhDs. You want to bring the best in class in the available market. We have. You want team players, okay. You want people that will be able to align on the vision and I think for me is to give them enough space in the playground. I think that that's crazy. You. You not bring Ronaldo and tell him, okay, you, you cannot cross the. You cannot cross them the. The middle of the. Of the court. Because if you limit Ronaldo, you'll get minus enough because he will be frustrated and all the team around him will be frustrated. And so you bring players that know how to play with each other and you give them the space to be on their best. Same for the PhDs. If I would tell them exactly A to Z what they need to do every morning. They will never want to stay in this company if I will tell them, hey, this is where we want to be. We want to be the leading AI con, the conversational AI solution for enterprise. Now tell me what I need to do.

Wow.

And so all of those people are invested in the success of the company. I can tell you we had huge opportunity with one of the really top companies in the world. On Friday, they signed with me, NDA. On Monday, they started EVA evaluating a new product that was just released. All of the PhDs were working during the entire weekend in order to make sure the solution is ready because they understand. They understand where we are heading. They are part of it. They are invested on it. And I think that's the. That's the key.

Okay. I love that you're hiring the cultural fit. You're aligning them with vision. You're giving them the place in the sandbox to play. I'm curious how you know or how do you gut check the ROI that you're expecting to get off of a hire like that? You know, it's not like we're hiring a person to do all of these tasks and we know what the result they're going to get is. This is you're hiring a senior person with a paycheck that's pretty large. Is it just kind of like a litmus? Like, how do you. How do you judge or decide how much revenue or gross margin you need to generate? Or how do you decide how much of your payroll to allocate to this sandbox to just see what comes out of it? How do you. How do you decide those things?

Because of the fact we are only 55 people. I know everyone, meaning I. In. Even in the. There is even the interns that joining us. I'm meeting them personally to make sure that they are aligned with our culture. It will. That it will be fun with them, that I will be enjoying drinking beer with them. Okay, so first of all, the cultural fit is important. Second, we will not hire if There is no need. And so I'm always balancing, for example, between building the business with sales functions or marketing or research. So there is continuous evaluation of where to spend the money. This is the CEO. All right, you. I know everything. I know how much investment we got, I know how much revenue we have. I was part of defining the company goals. I know how our competition, what they are doing. So I know where, when I need to push on the gas in terms of innovation and when I need to push the gas in terms of productization and where I need to invest on scale in terms of infrastructure and when I need to invest on security because we are really before launch. So there is no way I will just hire 10 PhDs just because I want to hire 10 pages. There is probably a big need.

To.

Take a big leap ahead of any competition in the market. So I will make sure that I will bring the first two and they will bring the next three because they know them or they know what they achieved in other company or they can evaluate what they can achieve. So there is always, okay, what I need, what do we need in the next two quarters, how much it will take to deliver those commitment and then when, when and how many I need to hire from which profession.

That makes sense. And, and it sounds like you're also hiring for the specific need and giving them the sandbox to play in. It's not like you're just hiring them and saying, go play. You're hiring for a specific. That makes more sense to me. Okay, in selling to these Fortune 500, can you give us some of the lessons? You know, years ago, I remember hearing that when you sell to these big companies, everybody you talk to, it's always yes, yes, yes, yes, yes, yes. And they drag you down a path and you never get a deal. You just get. How do you, how do you navigate through the politics, the bureaucracy? The fact that so many people in big companies just say yes, or has that been your experience?

Selling to enterprise is the long process for sure. It's not only for new technology. I was in Cisco, I was in Intel. It's a long process to sell to enterprise. I think the key is to know the customer and to know the process. What does it mean to know? You need to know the processes. When is their budget planning, when sometimes there is opportunity to use budget, unused budget or the end of the year. Who is the buyer? Who is the one that hold the budget? It's very hard to sell if you don't know the customer. When you don't know the customer the processes are longer or you are surprised from the process. So I think that that's a key. What we be, what we see is that even in POCs I would suggest not to do free POCs because if customers are not paying for anything, they care less. Champion on the technology is critical and someone that will be able to help you facilitate, give you tips how to move forward. I think that having a champion is also critical and end of the day she continuous engagement to show the value, to show new, to share the roadmap, to listen to the customer needs. So yeah, so it's 100% hard work to if you want to sell into big enterprises.

So you just said on something and it was tied into what my next question was going to be and that's listening to the customer. I can't imagine how hard it is to evaluate all of the possibilities and all of the needs and all of the ideas when you only have 55 people. And I think true leadership is saying no more often than we say yes. How do you balance all of those opportunities with either a no or a not now? How do you decide and how do you. Yeah. Can you speak to that?

Yes, of course. When I came after three weeks to the company, I wrote a game plan for the next year. It was important for me exactly for that and the second year we already created this game plan that, that was built by probably at least 10 people in the company. And the goal of the game plan is to create focus. What are the main KPI of the company? Revenues, technology, cultural, pre post sales support, SLS. You define whatever is fits your company. Let's say five KPIs and then it's aligned. It's anything that is progressing the company toward those big goals. Okay, that's, that's a, that's a goal. Okay. Anything that is a disruption, worse discussion meaning I'm not saying no. Okay. If, if I. I'm getting a new business opportunity with a new part huge partner in US which we didn't plan to do at least let's discuss before we say yes. So first of all what we did is let's focus on for example North America and the UK and Germany and let's not do business in Israel because it's a small market. Although it's very hard for me to say that I'm a startup, I need to reach X million dollar AR next year. That will not help me even if many companies in Israel will love the technology. Not sure it will help me achieve my ARR goal. So second is like industries, we cannot as a startup, you cannot now be expert in automotive, in construction, in pharma, in food. So you need also to prioritize the, prioritize the industries and be ready to change it over time. Meaning if you see that you said, okay, I am focusing on three industries and you see that one out of them does not bring results, be ready to change to another one. But don't go, okay, I want all of them. Something will be catching in the net. No, it will probably. You will not invest enough. What does it mean not invest enough? You need marketing budget to go to events. You need marketing budget to run campaigns. You cannot, you are a startup. You cannot spend $3 million only on events because you need to go to 10 events from different industries or so. So that this is how we did it.

I love that you said let's talk about it before we say yes instead of let's talk about it before we say no. I don't know if that's intentional or.

If that's just intentional.

It's very, it's. I caught it. It's, I love it. It's beautiful. I'm going to use that for sure. There's something that's very focused around growth and also inclusivity but also in, in like we're being a little bit strategic here, but it's also more positive versus negative. There's something very NLP about that. I like it a lot. How are, how's AOLA funded? How are you? Have you guys raised money? Are you privately funded?

Yeah, we are now in around A plus with existing. It's. First of all, it's significant. United Airlines is part of it and we have a few VCs that invested us in previous, in previous rounds that continue to invest in us because everyone believes that that's, that's a company that will change things in the industry. So, so we have a few VCs, a few private investors, the founders. It's. We're about to close the A plus round and next will be the B, the big Quilters.

I just, I, as you were just explaining that I just looked on Angell list to see if, if you're on Angell list yet. But there's no secondaries, there's no, no ability for anyone outside to get in yet other than the A round. So we'll keep an eye on you in the B rounds. Alon, I want you to go back and give yourself some advice. If you were to talk to the 21 or 22 year old Alon, what advice Would you give the younger you that you know to be true today, but maybe you wish you'd known at a younger age.

Continue to be bold. If you look on my resume, I started as a software engineer, software manager and I changed to business. I took risks to manage startups, to relocate to us, to go back to Israel to live, to go to work with different technologies, telecommunication, move to online to weeks, leave amazing company to a small startup. And so I'm. And by the way, in three weeks I'm going to the. To climb the Everest. This is like very similar. I'm always looking for the next dig challenge to climb the next big mountain to climb. And I learned from every chapter in my, in my career. So yeah, I don't think a person needs to change roles every year. But Today as a COO, I can speak with PhDs on, on voice, I can speak about go to market with my VP of marketing. I can go and sell, I can speak with investors. I would never be able to do that if I would stay in the same position in the same technology in the same country. This is so this. I think that that's if I would give a loan in 20 years a goal tip. That's. Yes, that's the right path to do.

Okay, so I get, I get to be bold that you do not get to just say that you're going to go and climb Everest next week and, and kind of skip over that point. Um, one of my close friends is summited twice. Are you, are you doing Everest? Like the summit of Everest, like 29,000ft Everest?

No, I'm going to the base camp.

Going to Base camp. Okay, well that's still like, still amazing. Okay. Because my, my.

I did Kalimanjaro and now I will do the.

Okay, okay. Okay. So going to base camp's good. That, that's okay. You're going to hike. You can do like. Is it like the 18 day hike up to it or something or.

Yes, yes.

Okay.

Yes.

Okay. That's okay. That, that and I, because I was going to ask like how do you take three months off from a company to go do an Everest subdon?

Even three weeks is difficult.

Base Camp is good. Nepal is beautiful. I was there. I did a champagne breakfast at Base Camp. Oh my gosh, 14 years ago now. It was amazing. So enjoy. Well, Alon Paleg, the COO from Ayola, thank you so much for sharing with us on the Second Command podcast. Really appreciate the time today.

I really enjoyed and I will be happy to have such session again and again.

All right, Take care and enjoy Nepal.