40: Using AI for Generating Professional Headshots with Marko Jak

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Chiefaiofficer.com can help. Welcome to this week's episode of Using AI at Work. Today we're interviewing Marco Jack, founder of Sector AI.

If you're not familiar with Sector, it's probably the category king when it comes.

To AI generated headshots and professional images.

That you can use for your social media and personal branding. This is a fascinating conversation. We covered a lot of territory. He's a great guy and brings a lot of knowledge to the subject of how do I start using AI at work? So with that, let's get started.

Welcome to Using AI at Work. I'm your host, Chris Daigle. Each week we'll be learning how today's business owners, entrepreneurs and ambitious professionals are getting more done with smart use of tomorrow's tech. Let's get started.

Okay, Marco, thank you so much. We're actually doing this recording from our studio in Bastrop. Marco commuted out here from the other side of Austin, and we've had a chance to kind of start talking a little bit about where we want this conversation to go today. And we have the advantage of the fact that he was involved in AI way before November of 2022, when most of us got involved with Chat GPT's release. So I know we kind of already covered some of that ground, but if you don't mind, let's kind of go back to that and kind of give us a history of how you got involved in AI. And I'm very curious. What, what led you to AI in particular, even back then?

I think pretty much I've always been interested in brand new technology. Right. So like many other people, you see something cool and you want to just give it a go. But I think what maybe set me apart from everyone else is even if it was really bad at the time, I would still be. I would see what the potential could be. Right. Because all technology sort of improves over time. So what I'm doing now, I'll just maybe tell you a bit what I'm doing now and then how I sort of started off. So basically, Sector Labs is our company and we've since beginning of 2023, we've been doing professional headshots with AI and it's evolved quite a bit more now into a sort of all in one AI kind of headshot portrait studio that you can do anything with. And evolving a bit more. I'll maybe tell you, like, a bit about that. But how I got into that actually was in 2022, the. There were AI image models out there. Some people may have seen the whole AI art thing that started in 2022. At the beginning, it was kind of quite poor. The quality of the art was bad. And if you try to make a person with the image model, always make a distorted view of them. And during 2022, one thing that started, there were a few companies that started up offering these sort of AI avatars. They. Did you see that stuff at the time? Huh?

Synthesia and things like that?

Well, no, no. AI avatars. Like see yourself as a kind of superhero or as a Van Gogh painting, Right? Yes. Yeah. And so I'm on Facebook.

Everybody was doing them.

Everybody. Yeah, yeah, that's it. And I think even prior to that, there were some people trying it out. And so I saw the potential in that. I was just. This is interesting. I didn't yet know what company to build at the time, but sort of a principle I have is I'll always sort of try it.

Okay.

And I'll experiment with it. Because it's only through doing that that you see where the opportunities come in as you can't really see them at the beginning. And so we actually built like a WhatsApp bot. That's where it actually started. Tell me about that. Well, you could just basically start like a. Start a chat with like a WhatsApp business account, and it would say, upload your pictures. And we thought that kind of made sense because you have your photos.

Sure.

You know, on your phone. And we did this in, like, seven days. We had the bot up and running. You could choose from different styles. There was like a superhero style and a what's in Christmas style, because this was in December 2022. And. Yeah. And everyone was kind of like, oh, cool. Yeah. You know, there wasn't anyone actually willing to pay for it.

Yeah.

And my.

Were you expecting that it would turn into a business or were you just playing with. Experimenting with it?

I think at the time it was like, well, maybe if we find a way to do this on issue WhatsApp, it will go kind of viral. So really just, you know, the unreasonable expectations, but more so just seeing. Just basically kind of play with it. Can we do it?

Yeah.

And my wife at the time, I did her images at the time. She is still my wife, but at that time. And I did her images and I gave her photos back as kind of Wonder Woman. Or something. And she was like, oh, cool, you know, what am I going to do with this? And one day we were actually having a fight and she wasn't speaking to me. We were just, you know, having some conflict. Right. But then she sent me a text. She said, not that I'm speaking to you, but can you do this for my kind of LinkedIn profile? And at that time, it was really bad at doing any kind of photographic representation of you. Yeah, really, really bad at it. But I could see that it was getting better. And that's really the sort of theme here, is that all of these things, your first experiences may be bad, but I guarantee you it's getting better quicker than you might think. And sort of that's. We started there and most people when they tried it out right at the beginning were like, well, you can't build a product out of this because it's really bad. But within a couple of weeks we figured out some things and we figured out some more things. And now. Yeah, and now we have generated over two and a half million. I saw that AI headshots.

That's fantastic.

Yeah. So that's that story. And I mean, I can go into more detail. Maybe we go. But pretty much I started with AI in 20, what's it, 14? And at that time I started a company which was not in AI, but it was with a co founder. And we were like those two people who are like, well, what are we going to do? What are we going to build something cool, Something that we can, you know, make a lot of money doing. Yeah, yeah. And actually we tried to hire a engineer and I got thousands of job applications and I was like, can't we do something to kind of filter all of these applications? And that was like the first time we started basically doing stuff in AI. And this is of course, prior to the current architecture of AI. Yeah.

So you discovered the problem in your own business. Like you realized, oh my gosh, there's an opportunity here to screen all of these.

Yeah.

And then that turned into a business.

Yeah. So we sort of just started building a product to actually fix that problem. And then we ended up speaking with a company called adcorp. Ad Corp is a really big HR company, but they mainly in emea and they have Kelly, Kelly Quest. They do temporary recruitment. I think Kelly is like a US company as well. And we gave them a demo of this and they were like, this is great because they were dealing with thousands of applications for every job. And they had thousands of jobs going. And so that's where the first acquisition came from was this corporate buyout and gave us like a really big head, like, oh, wow, we can. Easy. This was easy. Yeah. A bit of beginner's luck. Yeah, yeah.

So where were you doing this? We'll be back after a quick break.

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Oh yeah. So can hear from my accent probably. I actually lived in South Africa pretty much all my life. I've been in Austin now since 2022.

Okay.

But before that I was in Amsterdam for four years. Five years.

Okay.

Yeah.

You came to Austin because of the tech environment or just heard it was a cool spot.

I mean, my wife and I were always kind of looking for a place we could kind, kind of call home.

Yeah.

And my brother in law had actually moved here previously. He said it's just a great place, the people are great. And he was actually right. It's just like we, we, we, we actually love the States. It's just you just feel more kind of welcome here than you do in any other country.

Did you know that Austin, like Was a nascent AI environment when you arrived here in 2022? Because it is like, there's a lot of. I mean, you're here, I'm here.

Yeah. I did know it was a growing startup capital. Yeah. You know, so everyone knew the Bay Area. Right. And there's quite a bit of AI stuff going on there as well now, of course. But I did know it was a growing capital and it felt like a place that we could be at, at home and, and I could build a company. But this is of course post kind of COVID So what we've, what I've seen is that you can be pretty much anywhere nowadays. Right. Everyone's just basically working from home. Yep.

So was it this experience with your wife's request that kind of got you thinking about the professional headshot environment of realistic photorealistic images?

I would say she planted the seed of a application that we could charge for because there was an obvious need there. Right. Like people would go and book a shoot with the photographer. And the first thing I did was just check how much that actually costs. I was like, well, I can do that for a fraction of that price. And at the time, it wasn't good enough. But I tried. I've got still pictures of myself that I tried because I've sort of become like the test model just because I can do it. I don't have to ask anyone to make pictures of them. So I just make pictures. And it just. No one was optimistic about it then because it just. The technology wasn't there. And so you get, like, a lot of pushback at that time when you try and do things that just. The quality is not yet there with the AI, that quality improves so fast. Yeah. And sort of the first thing I did was I just. I didn't even have an app at that point. I just had the idea. So I built an online form through something like tally, and you could pay on that form. So it had like a what's in Stripe integration. And I put a couple of demo images on that form and I put it online and a bunch of communities. This was in January of 2023. Okay. Yeah. So just after the kind of WhatsApp bot that we tried in December, we pivoted down to this. And my co founder at the time.

The WhatsApp bot was more novel. It was like, oh, these are fun and cute. But it wasn't necessarily.

That's right.

Okay.

Yeah. We. We tried to charge people.

Yeah.

For it, but they were like, no, thanks.

Yeah.

Because I think, like, the quality wasn't.

There or the app. The use of it wasn't there.

Application. That's right. Yeah. Because it was the stylized pictures. You as a painting, you as a. As a kind of superhero.

Yeah.

So it just didn't. Really didn't. You know, it was just fun. Yeah.

Which is fun.

And. Yeah. And started with an online form. And the part that I knew there's something here. Right. Is when we had so many orders going on that form that I couldn't process the images that people had to upload basically fast enough because they had to manually just dump a whole bunch of files into this form, and I had to crop them and I had to, you know, change these images in order to be able to. What's in a trainer AI model.

Sure.

To represent them with that image model. And I turned off the form and I said, here's like a wait list. And I had people sharing the wait list with each other.

Wow.

So I was like, well, that's probably an interesting sign that there is something here.

Yeah, yeah.

And sort of we had to build the plane on the fly. Yeah, we, you know, we went from the. The form to automating the image kind of cropping to building a basic interface, still having the form. So this all happened within like a month. We had the entire app and running and everything.

So are you a tech background? You have a tech background?

Yeah, I've. For like the last 10 years, I've just been building all kinds of products.

Okay, so are you guys training, like training your own model? Are you using somebody else's engine for the generation of these images? Or how did you arrive to where we are now with the quality that sect is putting out?

So I think everyone in this space will try to pretend like they have their own.

They built their own thing.

Yeah, they have their own model. And the reality is that there are what's. Frontier models. Yeah. In the image space, in the kind of video space. OpenAI. Right. Anthropic. In our case, a company called Stability AI, yeah, they built the stable diffusion series of models. These are image models. So similar to prompting an LLM where you're like, I mean, I think now your audience probably knows how to make an image with AI, but at the beginning, people are like, how do you make an image with AI? So it's basically text to image, you know, and so where we have differentiated ourselves, I guess that's what you're trying to ask is like, where. What are we doing kind of different. Differently is in everything that takes you to that image. So for example, we do a lot of work on the uploads, the quality control on your images that you upload. It may not seem obvious to most people, like, I'll just dump a bunch of pictures of myself into here so that the AI can recreate me. Yeah, but it's a hard problem. It's still like a hard problem. It's like, which images do you basically fine tune on? And there's a lot of work in that kind of pipeline, in the augmentation. So let me. Okay, let me tell you what's a funny story here. So when we started off, the one thing we couldn't really figure out is how do we get you in the center of the image? It sounds dumb, right? But like we would generate 10 images of you and six of them, your head would be cut off somewhere. Okay, Right. So now at this point, there was no technology to the opposition you in the image. So you would try to prompt it. Like a photo of Chris Centered in the frame. Right. But that didn't really work that well. So the first tech we built was are you cut off or not? Just is there a face in this picture? Is Chris in this actual picture? And then we would discard pictures so you would get 200 images in your gallery. We always believed in giving more than, you know, trying. We haven't really been a company where we've been like for every 10 images we're going to charge you X amount. It's been a bit more like here's a couple of hundred pictures anyways. But that was one of the things and you know, sort of like that's where the technology started is how do we get that end experience. And since then we've built our whole bunch of things and we have actually fine tuned our own model on top of the open source models.

So I first found out about you guys I think in August of 2023. And as a matter of fact folks, if you're looking at the any marketing around this podcast, the image that you see that I've been using since then has been a headshot that I got from Sector Nice. But now you guys have, I mean and I was happy with those, that quality. But you guys have continued to improve it.

Yeah.

You recently had, I guess in the past 30 days or so some. Is there like an enhancement to the models that you've released recently?

Yeah, so there's. In the open source space, there's been a brand new company called Black Forest Labs and they came out with a brand new image model. If anyone here has used X Twitter. Right. And there's an AI Grok, it's called. Right. You can generate images on there. That's actually using Flux. Flux, that's right. And Black Forest are actually ex employees who left Stability. AI Okay, Stability. I had some. Their CEO was kicked off, kicked out of the company, I think. Well, I don't know if that's the official story but. And they had actually left and they started their own company and so yeah, so that's, you know.

Yeah, I mean you're getting better results from Flux.

Well, so we, we are kind of testing that model but there's a brand new model coming out from Stability AI as well. They in the kind of final stages of basically safety testing and doing all kinds of things with it. They've been much more careful I think in terms of ensuring that the model doesn't produce NSFW images that the data set is actually trained on is actually fair. There's copyright, all of those things. So yeah, we're in the process of basically overhauling the entire product. But it's, you know what, Chris? It's like you think you've built it and then something happens and then you're like, oh, great, I have to rebuild it.

Yeah.

And so this is exactly what's going on now is maybe I can tell you a quick, you know, story like about this is when, when we started off, right, you had text to image, which is what we were talking about. Like, give me a photo of actually Chris wearing a hat with the professional clothing. And so a lot of the work went into prompt engineering there. Like what keywords, what, what, what, Sorry, what kind of tokens do we incorporate in here? And you know, just to try and get you like the right picture out. But there were a whole bunch of startups trying to do things on that. And then this open source tool came out called control. Net. And what ControlNet was, was just like a way to specify which part of the image you want changed or where we want to put Chris in the image. They had a piece of software called the Open Pose. So Open Pose was actually one of the models. So Open Pose is you can pose the person in the actual picture. Right.

And so like different stances and body.

That's right, that's right, yeah. And so what you then find is like all the work you've done up to that point is now gone. And so this has played itself out again and again. We were a bit smart about it, so we built our inference pipeline. Inference meaning like how we generate the actual pictures in such a way that we can just plug and play whatever the academic and open source that communities are doing. And if we want to make any kind of changes, we can actually do that. But as you add more features to your product, it becomes more difficult to rebuild your product. And yeah, so we are making a big upgrade now. But ultimately our goal is to be like, can we. Anywhere there's a picture of you? So there's a thing that you maybe haven't seen about our company. But we tested a product where we put you in any kind of clothing so you could find a photo of yourself on the Internet. You could find, sorry, a photo of a guy wearing a T shirt on H and M store or any E commerce store.

Yeah.

And you could grab that photo and you could put yourself in it and it actually works. And so we had people very interested from the kind of fashion space, but then we turned that down because I don't know anything about fashion. Yeah, yeah, this is, this Is my T shirt. What do I know?

Yeah.

How do I. Who am I to disrupt the fashion space? But that is one thing I think that is going to actually change. Like I wonder if you'll have to go into a store anymore if you can just try on any, any kind of clothing with AI.

Is anybody doing that now?

There are startups now that have picked up on this. We were early with this. I already had this idea in June of last year. I was basically thinking about this and but I think they mainly doing it with the E commerce stores. Right. So like doing it as instead of hiring a photographer and doing a photo shoot with a bunch of models wearing your clothing, just generate them.

Got it.

We were trying to do it more from the bottom up. Like.

Yeah.

Give you a kind of virtual kind of fitting room that you can try on any outfit. Anyway, so one of the things that.

I'm curious about now I have some branding or whatever that we're looking to do with our business so I can't necessarily it some images I need to look like I'm in an office and Sector has done a fantastic job of doing those sorts of things. But what are some of the applications and I don't know if you can talk about it in advance but for this tool because the number one user, what are they looking for when they go to Sector right now?

Well I think currently they need a picture that will actually match their expertise or the image that they trying to portray somewhere online could be print, could be low on their profile picture. And so the options are they take a picture on their own or they've asked a friend to take it. And that's quite a labor, you know, laborious kind of questionable quality output. Yeah, questionable quality or go go to a photographer. The irony with a photographer though is like you don't get that much choice. Some of photographers even will be like if you want to change your outfit you pay extra $200. Which was like interesting to me. I didn't know that that's how they work but it actually makes sense because it's a function of time. Right. And so they're coming to us just as a replacement. What's in for that? But what I'm seeing a lot more of our power users are people like you I would say who have a need for constant content creation to support their message or their brand. And we have like thousands of users who seem to be using the AI photos of themselves to support an online post or a kind of video. And they found that the engagement increases because they have the. What's a picture of themselves there? And that's something to do, I think, with like the face. If you see a post and there's a face in the image or in the video, we sort of have a natural tendency to stop. Whereas if it's just like a photo of a chair or something.

Yeah. So the people that are using this, are they finding that, okay, this is my image, this one works well. Are they getting better results from. Because, I mean, you guys will generate hundreds of pictures when somebody uses the service.

Yeah.

Are individuals using all of those pictures or they. Is it kind of like a photo shoot where you scroll through a hundred of them and go, I like these five.

I think it depends. The vast majority, I'd say are like, I just want to get a good picture. I'm tired of my kind of wedding photo that I have pretty much like everywhere. And it's like 2 years old or 5 years old or I need to. I've just started a job somewhere and they need a good picture. I'm going to a conference. So it's a very point based, like, just get me a good picture. And then the choice just gives them the options on, like, how do they want to actually look. And we have a whole bunch of instant editing AI kind of features. I think we're the only ones who have as many as we do. Everything from adding glasses to your face, taking off glasses, changing the smile, giving, like yourself, hair if you want, like Elvis. Some of the kind of hair stuff is actually funny. Yeah. But yeah, so the vast majority, it's just a replacement for a photographer. Right. Just go and get that picture to upload to your profile.

So this leads us into a topic of disruption. I've paid hundreds of dollars for photo shoots with professionals and was uncomfortable. I don't feel like I'm not the camera guy that's, you know. So that was unusual for me. The cost associated with. With it was always kind of like a necessary evil. You know, doing wardrobe changes and all those types of things was just like, I'm not like you. I'm not in the fashion space. So that was all like an awkward experience. But I knew that I had to do it. And it was an afternoon and then I had to wait for editing. And, you know, out of all those pictures that I spent hundreds of dollars for, I would get two or three that were good. And some of them were just absolute trash. This has got to be stepping on the business of some of those individuals that I would have hired for hundreds of Dollars. Are you. Do you think that you guys have enough of a footprint in this space to be introducing disruption to that. That business?

Yeah. I mean, you could just see it online. Online keywords. Right. Just how people search on the Internet. The keywords around AI portraits, AI professional pictures, AI corporate photos.

It's growing like crazy.

It's just growing like crazy. While the other keywords, photographer, professional photographer near me, headshot, photographer near me. Those are sort of flat or going down. But I think it's still early. One thing I thought, you know, building this product, like, oh, everyone will know about it.

Yeah.

But it takes a while for people to pick up on it. I think there's still a perception that it's bad. So if you look at how, like, photographers are talking about it, they'll say it's what's in what's. It's basically tacky. AI, that's the term I've actually seen them kind of use. Or it looks. It kind of looks fake. And that is true. It can fake.

Yeah.

And at the beginning when we started to do it, a lot of it did, but it's just getting better and better every day. And, you know, we start when. When we first started, we had like 20% of people just like, give me back my money.

Yeah.

And I cared about that because it was a sign of, like, the product is failing. So I'd be like, we're always going to give people back their money just because that's a way for us to feel the pain. Otherwise, if you don't give. Give them back the money, then you sort of distance yourself from the pain.

Yeah.

It's like, why did we give away $1,000 that today? What happened there? Okay. Something happened, or we actually inadvertently shipped something that actually broke something. And so, yeah, so that's, you know, we sort of saw that and. But it's still there. The industry is still saying that. Right. It's basically fake or kind of tacky. I genuinely don't think you'll be going to a photographer for all kinds of things. I think photography will remain where it's secondary to the experience.

Tell me about that.

So, like, say you had like a wedding.

Yes.

The core thing is the actual wedding experience. The photography is a way to capture that actual memory.

Yes. Okay.

I don't want to use AI. I do want us to stand all together and take a picture because it's a bonding moment. And so in those areas, that makes sense. It's definitely going to stay, however, in the area where you just want the output I think that's the key thing with AI, right. Is like what people are not understanding, I think, is that the ability for AI to just give you the final output is just getting quicker, better. It's on all three cost, time and as quality, all three are improving at the same time. And at the beginning it looks like a toy because the quality is bad.

Yeah.

So you go, oh, wow, cost was good. I could do a bad picture of myself in like a minute and the quality is really bad. But the cost and time were good. So you go like, well maybe it's a toy, but that quality is improving so fast.

Yeah.

And so yeah, they, they definitely the people who offer a photography service or image editing service or a content that production service, audio, video, images, I think all three, if you just want the output, that's what AI is going to actually give you and they're going to have to find something else to do.

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Now back to the episode. I like that, the way of looking at that because although I would imagine with the proper prompts and the proper headshots uploaded, I could say give me some image, like give me photos of my wedding that hasn't actually happened. I mean it's, it's getting to that. I would imagine pretty soon that you could be able to. Any historical event, any concept that you can conceive, you can actually put your images in there and there you are signing the Declaration of independence. Or yeah, actually those on the moon.

Those are two different things. Right. So that the one that you're talking about, which is super interesting is saying, look, I have photos from something that took place. Let's say it's a corporate like event or it's like a wedding.

Yeah.

And you say, how do I use AI to clean them up or to give me more options. So that will be also happening. You say, oh, you know, because the problem with real world pictures is they are not perfect.

Yeah.

So you might have a photo where this is such a great photo of all of us. And I want to, I wanted to make a print of it, but Chris closed his eyes yeah. Damn it, Chris. You know.

Yeah, sorry guys.

You know, it's a really bad photo. So AI, maybe we open up your eyes. Yeah, right. We can already do that now somewhat. But I think that's where AI will be used as a tool by the photographers to give customers more, you know, the option and the same thing podcast editor will give a whole bunch of kind of variations that are generated by AI. So there's this topic of variation I think that is common across the entire space. Let's say, you know, you want to be like here's an email that I want to send to my boss. You put it into what's in, you know, or a investor update, right. You say give me a couple of variations of this. And so it gives you more options.

Yeah.

And that's definitely what is going on now I would say is it improves your efficiency by giving you more options.

I like that a lot actually. So are you able to talk about kind of where you see sector going or. I don't want you to give away any secret sauce or anything but I would imagine as early as you were you've been and back in June of last year already thinking about things before the industry had caught up with, hey, maybe we can do this. Are there some things that you're expecting to see from sector or from this technology that is already in the works that you can talk about now?

Well, the one thing we actually working on now is how do we take real photos? Exactly what we were sort of talking about like yeah, you taking pictures out there, maybe they of yourself or of your family. How do we give you the tools to make the correct edit to that actual picture? So you say my eyes are closed, open up my eyes or I don't actually like that shirt on me. That's actually one thing we're experimenting with now. It is a hard problem. The other thing we were playing with was multiple people in the same picture. There's definitely some kind of viral or consumer startup of like photos of you and your friends in are fantastical places. But it's really hard to put two people into the same picture from two different kind of fine tuned models. And then we actually working on at the one shot tech, that's what I kind of call it. And what that is is basically giving you a professional picture without you having to upload 20 pictures and instantly without having to basically fine tune a model.

From one image, be able to create one image.

And so you'll see the big companies, they all trying to crack that nut and that's and that's something that we knew from the beginning that was going to come. But it's a hard, hard problem. So if you look at basically Facebook, Facebook has like a meta. Imagine me now and how that works. You should take like a face scan. It's basically just taking photos of your face and they generate pictures of you and they don't fine tune a model to do that. So that means then they're not injecting your images into the model and you have a crisp model that we have to load every time. I think part of that is just they don't want to deal with the cost, they don't want to deal with the time, they don't want to deal with like all the customer data. But I think the, even the AI headshot companies are going to be gone from that perspective.

Where does that put sector?

Oh, we just, we have to be the ones to, to, to, to actually build that then. And we have to put ourselves out of business.

Yeah. So I know there's a bias to the, to the answer of this question that I'm going to ask, but sector was the first one that I ran across that was doing this and we.

Were like the first in the world to do it. Yeah.

Okay.

At least the professional one. Prior to us, there were a whole bunch that did the anime character.

Is this a niche where competition is starting to arrive?

Huge, huge amounts of competition. Yeah. I think that's what you'll see with. To be honest, my opinion on this is quite strong in that most software businesses are going to be out competed. There's going to be a, like every piece of software is going to become the commodity that anyone can, can actually boot up. It's a bit of a. But like everything from enterprise software to the consumer software will be able to be built on the fly. So you would say, look, wow, in the next five years, I predict that the cost of building an app will be $20.

Yeah. In an afternoon.

Yeah. And you'll be able to prompt it, build me a slack clone. And there you have slack. So then. And if the service is AI and every company is fundamentally a product and a service. Sorry, I may be going off the topic. Is that then that begs the question, like, what are we going to see? And we're going to see, I mean, probably an explosion of apps and companies and because the barrier to entry has just gone down and it's not even that you need capital anymore. Right. In the industrialization age, like you would have to buy the machinery in order to achieve the efficiency Gains here, you don't need to buy that. There'll be a employee, an AI employee that does that job and you can actually rent them by the hour. And so then that, you know, that's what we're seeing even in this space. Right. However, the differences are, I think is how much you care. So there's a lot of competitors we've got who just plug their API in some way because there's a bunch of companies also who offer the service now as a API, as the engine or some parts of it. So let's say they offer the. What's in. What's the, the fine tuning part of the service. So Your customer uploads 10 images, 10 photos of themselves, you send it to a third party API, they train the AI model, you get the AI model back and then you run the images on there. And so that's what we saw pretty much within two months after we kind of started. Just hundreds of these companies using stability as their engine. Oh yeah, yeah. Or just the API.

It's hundreds of these companies.

Yeah. There's probably like a hundred, two hundred. I get now I get an email every two weeks from one of these companies saying, hey, we've been kind of following you for a while. Do you want to buy us? Yeah. I'm like, no, thanks. Yeah, we'll just keep doing what we're doing.

Yeah.

But we, I don't know, we always gave back the money, always cared about it, perhaps more than we should have. Maybe like, oh, this is just like fun. But I don't know, I mean, I've always just cared. That person has a good experience. I still do like a support on the ticketing system every day, sometimes in the car, which is not good. I shouldn't do support while I'm driving. But yeah, yeah. So the, a lot of competition has come up. I think there will be even more competition in AI for every single, every single product. And of course, quite a bit of it is just like a rapper.

Yeah.

Around chat kind of GPT APIs or other. What's in Frontier Models.

How does sector stay the category king? Would you say that sector was the category king for this?

I would say that what where we failed to become the category king is on the marketing side. We have the best product, but your best product doesn't mean that much if people can't kind of find out about it. And the main channel for this product was SEO.

Okay.

Whereas we invested in Azure word of mouth, we were like, if this is good, you'll tell all your friends. About it. It's still our. What's a primary channel? I mean, 90% of our business comes from. Hey, my friend told me about it.

Great.

But it's not a scalable channel. It's not like it's hard to scale it.

Yeah.

You know, and so it's a good channel because it's good experience and you know, conversions from very high conversions. But SEO was like the main channel. So our story is that, you know, if you heard that quote, like your first time founders care about product. Second time founders care about distribution. Now that's been extended to third time founders care about retention.

Yeah, yeah.

And fourth time founders don't care about anything.

Yeah. They're so this retention. That's interesting because that quote was told to me early on. A friend of mine had been COO at automatic at WordPress.

Oh, nice.

And he told me that because I was like, man, our product's great. Our net promoter score is super high and all this stuff. And he's like, okay, that's good. But second time founders focus on distribution. And that, that's what led to us sitting here now. It was the podcast.

Okay.

I need distribution for our messaging and that sort of thing.

Yeah.

So I totally relate to that. And that's actually a quote that I use regularly for my own team. And now they understand the importance of quality has to be there for product and the support that you're giving to your own product and the refunds and the, the still being hands on with interacting with your clients is a strong like, that's not happening at a lot of companies. They're more interested in unit economics than they are in relationships and things like that. But you, I mean, you've, you've disrupted the, the cv, the resume environment accidentally when you're in your first startup and you've continued to see that pattern. So I would assume that that is something that when you're walking the dog or you know, staring off at the, the sunset that's popping into your mind. How do I make sure that we are not late? That we're not.

Yeah, exactly.

Without being too early also. So what are you doing to address that?

You have to cannibalize.

Okay.

You have to be own business. Yeah. You have to be that prepared to cannibalize. Like so the thing is that it's very hard to do that.

I mean, because of bias like your own. But like you love your own baby.

You have people that are doing jobs that you like. If that means we cannibalize, it means I don't need these actual people. Like imagine that at a scale of a thousand people. So you have a lot of incentives to keep doing what you're doing. I mean a typical story about disruption, but ultimately you have to understand what the customer cares about. They care about this. And there's a whole set of the market who just cares about getting one good picture, updating their profile picture, putting it under, you know, on like a resume. And so that's where the technology is going. And so we are embracing that. We've been embracing that for the last eight months, just continuously trying out brand new things and we're still really bad otherwise. If it was good, then we would have done that by now. So yeah, really just have to be prepared to understand that to stay kind of relevant. There's going to be a change in your business and that means that you cannibalize some parts of your product, you change the focus on the market. And the other thing we're doing in the short term, so that's more a kind of long term thing. So I'd say in the short term what we're doing is we say who are the customers who love the product become most, you know, just like anything. And that's maybe that third time founders, you know, care about that retention. Retention implies kind of frequency and that implies care or delight. So you sort of looking for people who enjoy it and figuring out why they enjoy it and how do I find more of those people. So that's what we're doing in the kind of short term it's just like more like a focus on the market where this product is kind of constantly kind of useful to them. Of course they still. There will always be a package for people who just want to get a couple of hundred pictures, choose their favorite pictures and, and then they done.

So this seems like a, like obviously if I sold supplements or I sold, I don't know, financial analysis, there's a, it's baked in this recency and frequency of consumption of this. Right. But with the image side of things, how do you manufacture that demand for frequency of use of the tool?

Hard. Yeah. So the one way we are thinking about it is like how often do you see a picture of yourself? And that's what I was saying is like you may, if you're out somewhere, you're getting a picture taken, you're taking a picture in a group. That's where the inherent kind of frequency is. Yeah, you can't actually manufacture it. I think that's most many startup founders or people starting a Business, they sort of have an idea of what they want to build. You know, I want to build an online marketplace or there's something that's kind of hot. I want to build a decentralized company. And sort of, that's, that doesn't, that does. The, the form of the company is implied by the customer, not by what you want to build. The amount of money that you can charge is set by the market that you're going after. So there's the sort of four kind of fits thing that some people have talked about, which is your product, your market, your business model and your channel. And these are like four planes and sort of, if you change any one of these, like it doesn't fit with this market anymore. And that means that this market is not prepared to pay as much. And then your like channels that you have, you can't do ads anymore. So we, I mean we kind of, we, we had that problem where ads was like, if we're charging you basically $50 for your gallery, ads don't really.

Kind of work because the cost per acquisition was too high.

Yeah, I mean generally you should benchmark. As I found out is like in. At the US you plan for what's in $200. Just as a rule of thumb, you say, I mean, of course you can do it for, for less, but for scalable, like, okay, ads will be our channel.

Do you have any type of feedback loop with the customers so that you like, you've obviously got power users, people that are enthusiastic about getting new images and using those a lot in their marketing or their personal branding or even their. Just their social life or whatever. Yeah, but are you, do you have a feedback loop where those power users. And it may not even be accurate because a power user may not necessarily be the ideal avatar because they're doing stuff that the average individual isn't. But is there a communication environment where they're saying, oh, it'd be cool if you did this?

Yeah, I mean I talk to customers that all the time. I go through sort of highs and lows of that where I'll just be like, I haven't spoken to a customer for like a week or two or a couple of weeks. I'm feeling bad about it. And then I just turn on like the. Basically there's a thing that I can just turn on that when a customer, what's in them signs up, they'll get an email from me. I mean, it is an automated email, but it is a personal email from my inbox and they have my phone Number on there, everything's on there so they can reply to it. And if they do, I engage them on there and pretty much on there I'll say like hey, so what are we kind of missing? What was your experience like? I try not to send it straight away because if I send it within a day then I become the support person. They're like oh, how do I do this? And then I'm like oh actually they are getting support at the same time with the team. Yeah. But that's like the one way which I do it and we actually using AI for that as well for the supporter, for the what's in feedback. I think that's, that's one big thing that's going to change is. And that's how I see myself kind of losing a job because I'm fundamentally a product manager or and I see my job as how do you shape product? So what are we going to build? How do you think the people to build that? And that's like a hard problem because you have to communicate well what needs to be built, what aren't we going to build and how do we ship it, how do we make sure that we get it on time? And so one of the things is in order to shape a product you need to know what the customer wants, where the kind of market is going. I mean AI, I've been just basically feeding a whole bunch of customer feedback, whole bunch of online reviews, whole bunch of survey open ended questions and I analyze it like that. So I basically fine tune my own customer. Yeah, I create a customer, the Persona that I can speak with and I mean of course I don't take that as like as that is the truth.

Yeah.

But I take it as a guide of what I should ask real people about. Yeah, yeah, yeah. So I think that's where for example in the market research space as data scales, you'll be able to talk to your own customer anytime you want. I think all product teams should be kind of doing that like okay, let's have a quick chat online. LLM like this.

Yeah.

It's an AI on the other end with our female customers who are like kind of.

Let's talk about that a little bit.

So yeah, where are you? Lots of what's in startup ideas here. Yeah.

Where are you getting? I would love to be able to do that with my own stuff.

Right. Yeah.

So you're pulling. Where are you finding the, I guess training data, the sentiment from the customers to be able to create this kind of cloud of feedback that you're able to interact with.

Well, emails for sure. Emails for sure. Intercom, which is our live chat system.

Yeah.

We have a whole bunch of surveys that pop up here and there in the app. There's a. There's a survey you get when you get your first gallery.

Okay.

And it's sort of like asking you good, bad experience. And so we then follow up with that with other questions. All the transcripts from my calls, I transcribe those calls.

So you're actually having conversations. Like you're not just emailing back and forth with clients.

I'll do a call and I'll do like an hour call with the customer and then I'll transcribe that. I mean, of course I ask them up front if they aren't comfortable with it. I'm quite transparent with what I'm going to do with it.

Yeah.

And then I ingest all of that into a what's in prompt session.

Yeah.

Kind of thing. And I say, here, I like the trends, here's the other data, you know, let's have a chat. And you emulate as if that's the. The actual customer.

How much is that informing the direction of what you guys are doing, that effort?

Like, I think all things with LLMs, with chat, kind of GPT and Claude and all of that, what it does is it unblocks you big time. Like, you may have a hypothesis, like, I think I should build this feature. And in order to even get to the point where you like start building it, you would now need to set up interviews with people. And that takes time. Like If I email 100 customers, I'll get 20 interviews. People have the time for it, but it will be in like a week or two. And then this one cancels. And then like it takes like a good kind of month to collect like the right customer feedback. And so this is one way of accelerating which way am I going to go? What questions am I going to ask? So I believe in a, what I call a decision first kind of framework. You don't talk to someone just for talking to someone. You have a decision in mind. And then you say, in order to make this decision decision, I need the following information. And then you say, where does that information come from? Is it through talking to someone? I mean, interviews are very powerful. You can answer a lot of those with that. But in some cases you don't want a interview, you don't want that. It's not the right technique to answer it. What you want to see is what did they actually do versus what they Say, because there's some things that people maybe won't tell you because you're on a call with them, like how uncomfortable that that image kind of make you feel or, you know, it's okay because here's the founder of the company and I want to be kind of nice and polite. So some things you actually want to see what they did. So you don't just talk to customers for the sake. You talk for the sake of. I need to decide on something. Okay.

So let me ask you with the speed, like you mentioned doing something like in June of last year.

Yeah.

Right. If it was anything else, if it wasn't technology or AI in particular, that wouldn't be that long. Oh, last summer. Right.

Yeah. But in this world, it feels like dog years.

It was like last summer was completely different than where it is now.

My time scale is. I have never experienced this.

And it's just moving faster too.

It's just if you. I mean, it's been like a year some things, but if I look at code I built like 16 months ago, I'm like, who did this? What's going on here? Yeah. And yeah, the, the timescale is hugely that compressed.

So if you're, if you're interested in developing this, this environment of intelligence about customer feedback and sentiment and things like that, how long do you have before that stale or expires, it's no longer relevant.

So what do you mean? Like so long until that specific customer feedback?

Yeah. Because it's got to have a small shelf life because the customer that said, hey, I tried this a month ago, it was okay. You know that it's not the same project, a product 30 days later because it's gotten better.

I mean, it depends. Depends. Right. On the kind of feedback. But. So you know when someone is telling you something, right. There's always a sub kind of message. If they saying, I don't know. You know, there's that quote right. From Henry Ford. Right. Everyone did want a faster. Yeah, yeah. If I asked people what they wanted, they would ask for like a foster horse. Yeah, he's talking about the car, but the quote's incorrect. I think. Of course they want like a foster horse. They're not going to tell you how to make a foster horse. The car is like a foster horse. So the feedback is good.

You should ask people, regardless of the technology solution.

Exactly. The job they're trying to do, the task they're trying to get done.

Yeah.

Is the same. They might complain about you. Like you. You have to look underneath that Always. Because you can't just say, oh, well, they don't know what they're talking about because the tech isn't, you know, whatever. It's. They do know what they're talking about. They're talking about their needs and their needs are always the same. Your needs are always the same. They haven't changed. Yeah.

Regardless of the tools that you use.

Regardless, like they, if they complain to the photographer, look, my mole on this picture, what they actually expressing is I don't feel comfortable with the way I should look. And I need an image that represents me in a certain way for this context, which is at a conference. And I don't feel like there's an actual match between that image and the context. Doesn't matter what the tech is, it doesn't matter whether it's an AI tool or anything else. The need stays the same. So I would say it depends on that. Some of the feedback that we have on older models, I don't incorporate that anymore. So if they say, oh, my teeth are kind of messed up, it's like, yeah, that was an old model. So I don't always import all the customer data.

But you would be looking at almost like a meta complaint or a meta need, which is, I want a crisper, cleaner, more perfect image of myself. Whether or not it's reality. That's what they want. And then you look at the tech to support.

Yes and no. More like where is that image going to end up?

Okay.

That's what I'm kind of thinking about because it's not really just for you. And it can be. Some images we've done are like entertaining images.

Yeah.

We're just about to do like a face swap style. Nice. So you can. Yeah. Put yourself in any position, in any kind of meme or whatever.

Yeah.

But in general, it's like the customer doesn't tell you where they need the image and why there's a problem. So that's where you have to dig into that. The AI can't answer that sometimes because the AI is also kind of just using the text that's got. But it can give you the aggregate view of that, can give you a hint of what you should ask the customer about. Ultimately with our images or the photos, they going to end up somewhere. Yeah, that's what it comes down to. Right. And so if they're complaining about something, it's that it's not right for where I need the image. And that's what you have to try to basically find out then is where what are you trying to do with this?

So I got a final question here, and it's interesting because it kind of ties into the entrepreneurship goes back to the. You didn't start a company in 2014 that was intended to assist in, you know, resume selection.

Yeah.

You identified in your own use, like, oh, wow, it would be great if we could build something, if we had something that would do this for us. And then you saw that it was a business. Now, with this, with images, do you, I mean, obviously you have a, an interest in it now because it's, it's the business that you're building. But was this an accidental discovery or was there some interest in solving this particular problem?

Are you sort of asking what, like the core kind of motivation is that.

Got that for you? Of all the options that you've had, you've had successes across different industries and some failures. And some failures.

Yeah.

And. But AI allows for you to really participate in places where you didn't have prior subject knowledge. You've now got expertise to the LLMs or whatever. How did, how did this one. How did you land on this of all the options that you had?

So, you know, it's like existential question that you're asking. Like when you're asking me, my mind is exploding with all the, like the sub levels of Asha motivation. Like I, the sort of the, the ride. At the core of that is how I see myself. And I've always just seen myself as an entrepreneur, a person who likes to build things. I like to build stuff. I've built many things that nobody cares about. And so I've actually learned to try and find things where, hey, somebody actually needs those. It can actually help somebody. But I think coming back to the beginning of your question, which was kind of like the accidental part.

Yes.

That is sort of. You're asking the sub question. There is like, how do people come up with the ideas? How do people find some stuff to kind of work on?

Yeah.

And, and I think there's, you know, it's a hard question because there's. Okay, look, the one way. And this hasn't really been for me up to now, really, it's been like there's this problem in the world. And I, by the way, I have some ideas on this now that I'm thinking about now. Like, okay, there's this big problem. It's going to be a big problem in like five years and even bigger problem, you know, like in 10 years. And then you just, well, I'm going to build whatever I need to build to get to that end goal. And that's the sort of SpaceX pitch. Right.

Okay.

That's the Elon Musk. You know, in order for us to survive, we must make life multi planetary. Multi planetary. And everyone can quote that back. And. And the beauty of that is it's a big goal.

Yeah.

It attracts people. It's almost an easier company. SpaceX is an easier company to build to some extent, because it's such an ambitious goal. Whereas if you say, oh, I just want to, you know, create pictures of people. Right. So. So with me, the accidental part has just been the what's the curiosity? I've always tapped into that. And the one thing I have to turn off, and if you want to build anything of value, I think you have to turn this off, is the kind of judgment that comes from you. The judgment that comes from the outside. So you have to be prepared to make bad work. Right. A bad first draft, a bad first app, and you actually looking for things that show you what the potential is, not external kind of validation. So that's where my ideas have always come from. It's like, oh, wow, I didn't know I could do this. And AI was an interest because suddenly you could do something with a. I mean, you couldn't do a picture of yourself in the past.

Yeah.

And suddenly you can do this. It starts to bring up questions, well, what does that unlock? And for example, that's where the kind of fashion comes from.

Right.

Because if I can put myself in a picture and I can say, what's in that picture? Why can't I try on something?

Yeah.

Okay. You see? And then maybe by the same token, there's something else there. Like, oh, maybe can I see myself before and after if I go to gym for one year? There was a startup that actually did that.

Interesting.

Yeah. I mean, I don't think it's a repeatable product that much, but that's what it unlocks. So the trend with AI is sort of this compression of the task. So the tasks have always stayed the same. Right. You need to go get a picture because I'm going to a conference. It's always been the same thing, like, or I need to get a picture because I want my what's family to have it. So the way you would do that in the past, you would get a painter to paint you.

Yeah.

All right. So it's like, same, same problem, same thing.

Yeah.

But not many people could afford it because it was, you know, a painter. Yeah. Expert. Like a. So with AI, we're seeing this compression accelerate in the field that we never thought it would, which is like in the knowledge worker field. Yeah. We all went through from. Well, we don't have to work with our hands. We're not going to dig ditches, we're not going to work on the farm picking like the fruit.

The machines are going to come in eight years.

Yeah. And so this compression, if I see that anyway, if I suddenly see I can do something that otherwise would have taken me hours or days, there's a huge opportunity there. And so like I made a podcast, which I think you made an episode about now. You spoke about the AI generated podcast.

Oh, yeah.

Two hosts. Yeah, I think. Is that from. Because I posted the one.

No, actually you did it.

Okay.

Yeah. It just kind of hit the scene a couple of weeks ago and.

Oh, okay.

One of the fellows in our community was like, hey, check this out. But you did a post about the same.

Yeah, I made two of them. So, okay, so for the people listening, like, what are they talking about? There's a new Google product, Notebook lm. Notebook lm. I bought an open source version of that now, anyways, but there's just combining. Yeah, I'll give you access to it. But yeah, and so this Google product, you upload a text file or a PDF, you've seen it, right?

Yeah.

And then it generates a podcast with two kind of hosts. Yes. And they're talking to each other and like us, like they'll interrupt each other and they'll go, yeah. And they'll confirm. And it's like that. And so the first thing that came to my mind is like, there's probably a huge company here to be built in, or at least a content company that is actually focused on taking the written form that is not currently available in the audio form. So a very dense book about some kind of philosophical topic that is going to take you a lot of kind of friction to actually read that and creating an engaging conversational medium to translate that particular message. And so I still think there's quite a big company there to do that. I don't know if I'm interested to do that. But that's. So coming back to your original question of how do you get to this? What sort of drives you to actually work on this is I fundamentally what's in a. Curious about things. And when I see there's a compression, like suddenly I can do this and I couldn't do this. That's what we call the inflection point. Right. There's some inflection here. We're going through a huge one now. So the huge inflection point is AI and that's going to basically cause a whole bunch of things that you couldn't do in the past you can do, or it would have taken you many experts to do. You cannot do it like code. Right. You're going to be building your own apps in a couple of years.

Yeah. Well, I have to listen to this. Where can I find this episode you were talking about?

I recorded two. I called it based cast AI. I just posted them, like on YouTube.

Okay.

One of them is a few choice essays I had from. It's Paul Graham. Don't know if you know Paul Graham. He's the, you know that. The Y Combinator guy. And the second one was from a book called Courage to be Disliked, which is a great philosophy book based on Alfred Adler. He was a psychologist. And I extracted a chapter of the book and I fed it into there and I made two episodes, like deep diving into that topic.

I'm gonna have to check those out. That's awesome, everybody. Thank you so much. Listen, big fan of sector, as I mentioned, if you look at our. Any of the marketing that we use, and here's what I do now is in anytime I'm doing a presentation and I'm introducing myself and I do presentations all the time. I will, you know, you have the hero shot and everything. And before I change slides, there's an animation that pops up and that says that this image is AI generated. And the reason that I do that is because I want people to. To kind of go, wow, yeah, like, question reality. Like, oh my, he did that with AI. How do you do that? Because with this podcast with the questions that I ask and all those types of things, I'm wanting people to get curious about. Oh, I didn't know it did that. Oh, I didn't think I could do that with it. Right. And it's constantly changing. So we're doing what we can to let people know that. That this is possible and that sect is the jam. For sure.

Chris, thanks for having me.

For sure. Any closing remarks for everybody? Obviously, please go. Without any endorsement from Marco. Please go check this stuff out.

I.

You will get used for it. And if you are out there and you particularly a knowledge worker or somebody who is presenting as a professional, if you've got, you know, a crappy image, that's the. There used to be an old head. Head and Shoulders commercial that said you never get a second chance to make a first impression. And that is. That is the first impression that people get, it's not the title that you've got, it's not the banner image, it's who is this person? And if it's not a representation that you think, whether or not you've ever gone out and taken that picture, but that you think, hey, this is how I want the world to see me, it's not that hard. How long does it take to generate a gallery now?

Within an hour.

Yeah.

Everything back.

So I would encourage you to look at these. For sure it is. Of all the modalities of AI that are out there, certainly people are generating great content. Videos not there yet. This is one of those AI modalities that I would say is. Is there? I mean, like, I routinely use these images and people don't know. And that's my intention. Anytime I'm using AI, if it's coming across as synthetic, it kind of defeats the point. I don't want people to see something and go, obviously that's AI, because to me, it loses any gravitas that it had.

Any.

Any. Like, I'm not going to pay attention to that because it's generated by a computer. But if I can make it to where it's indistinguishable or as my friend Jody Cook says, indiscernible from human. Like human output or a human. That's. That's the intention. And I would suggest that if you haven't done this yet, Sector is nailing that when it comes to. Thank you for sure, man. I mean, like, go to their website and I think you recently changed the homepage, but you used to have like the kind of the grainy black and white headshot where you could do the slider and it would go from that into Marco in a suit. And is that still the homepage?

Yeah. I'm a bit tired of pictures of myself on the side, so I've been pushing the team to create like.

It's a great example, right?

Yeah. And so that one actually worked quite well. So I think that one is still there, but we tried different images just to see which one communicates it a bit better. But I mean, just maybe something quickly that you said here is that there's. You actually mentioned something that was very interesting, which was the authenticity of it. You said, like, I need a picture of me and the people that will push back to you now on everything. AI is the. What's the purists like? Okay. You know, it's not the same. It's not the same if a photographer does it and there's just that human touch and the sparkle and this. And I understand where they're coming from, but the purists have been around in every single technological change. I mean, there were film camera. Yeah. People, right. Who were like, how dare you use a digital camera. Film is where it's at. Like, film is pure. And even the what's in film, you know, the directors, like the movie that directors were with film cameras, digital cameras, AI. AI is just like another tool. It's like a replacement for the camera. So yeah, I think if you get rid of that suspension and you keep playing with these things, that's where you'll get the most actual benefit.

Awesome. Any closing remarks or anything that people should be thinking about on this topic as we wrap up the episode?

Keep playing with things.

Yeah.

100 everything will come out of that. Awesome.

Well, thank you everybody so much for joining us for this episode. I'm excited to continue the conversation off camera, but thanks again. And Marco, thanks. This was something, I think that's been in the works since the first time I did my sector images images back in August of last year. So thanks again, bro.

Hey Chris, thanks so much. Thanks. Appreciate it. Bye bye.

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