$0 to $500M ARR in 13 Months. Inside Higgsfield's AI Growth with Alex Mashrabov, co-founder and CEO

Like, what would it cost for me to build a video? Like, without skills and people, I mean, infinity. I'd have to hire an agency. It would come back 2 weeks later. It would be terrible. They would charge me thousands of dollars and I would delete it because I would never use it. Instead, I can do this in 60 seconds. And so it just, it's a visceral example that Alex is able to get 5 times the ACV off Canva, even though Canva is mass scale.

Yes.

By having an agentic workflow that, that replaces humans. And honestly, for me, it replaces contractor and agency that I don't have the patience to hire anyway, right? Rather than just helping me create an asset manually. Hi everybody. Special guest moderator me. I think Alex is going to join. We're going to have some fun. So Alex is co-founder of one of the most explosive video marketing and other apps, Hixfield. You guys should use it. So Hixfield AI, while you're on site, use it. And It's changed a lot, but if you look at any of the Saastr videos that I create, if you watch the agents, the intro of me and Amelia, it's all built on Higgsville. And I've been using Higgsville basically, I think since it launched or something like that, right? For all of our stuff. Close, right?

Yeah. I mean, and that means a lot to us. I think it was August, September. It was the first time when we started to evolve just from like on the social, pure social media play. To professional creation tooling.

Yeah.

And you were the first to spot this.

So I love it. I use it all the time. If we have time, we can even log into my account. I could show you all the stuff we're building, but it's for all of us just trying to learn. I mean, and I'm going to ask a lot of questions. Alex is going to present and I'm going to pepper a few questions. Now they're $300 million in a year, 15 months, or how quickly?

Yes, it took us maybe 11 months to get to $300. Now it's bigger than that.

Pretty, pretty good, right? So Alex is going to explain to it and where they're going. Like, we hear these stories, you know, how did Higgsfield and Lovable and Replicant get to hundreds of millions in months? And now actually someone's going to be honest and tell us the real story behind the story. I'll pepper with some questions, so I'll hand it off to Alex. But I'm a super fan. And if you guys watch any of our little short videos, it's all built on Higgsfield.

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Absolutely. This is a great honor for me to present here. So let me maybe briefly overview our journey in numbers. We are excited about a new wave of AI-native video creation for social media. First and foremost, social media is relatively new. It has been around for 15 years. And last 5 years it has become the largest media in the world. We are seeing numerous direct-to-consumer companies who actually make hundreds of millions or billions of dollars of sales by leveraging social media as a distribution channel and using platforms like Hixhill for content production. And this is exactly the reason why we are growing so quickly. As we are addressing this massive demand in the markets to make content for social media every day and build a brand and sell products on social media. So the, the, we were the first to maybe introduce camera controls and camera controls are extremely important for professional creative directors. We were really surprised that it took off so quickly and within just in like maybe 5, 6 weeks, we got to $10 million ARR. And then in August, September, and October, we realized that adoption goes beyond just individual creators. And since October, the priority is to make sure that creative teams can work together to make videos very efficiently. So let me give you a few numbers. So for example, this— in a week, we are going to present full feature movie in Cannes. And we are doing that to showcase the possibility and opportunities unlocked with video AI. So roughly, it took a team of 10 and maybe 3 weeks. To accomplish that. So the efficiency gains are unparalleled, and that applies both to long-form and the short-form content creation.

Alex, how big is the team today and how big is engineering?

So this is a good question. We have roughly half and half split. So 80 people engineering, and engineering is now really broad. I need to acknowledge that software engineering, machine learning engineering are always kind of traditional professions, but the amounts of people who do automation, prompt engineering also increasingly grows. And the rest of the team are, we have maybe around like 70 people creative team who are not native prompt engineers. And this actually is very important for us. We learn by external signals and internal signals. How to make those models actually usable, how to empower creatives to actually use them. And what we are seeing is that one creative director can now make ad end-to-end, like let's say within a day. Like before that, it would take weeks. It would require to assemble like physical production crew, rent a lot of equipment, book a space and so on. And now it's completely different. So for us, we believe that's like one of the core unlocks for Higgsville is to having creative team and engineering team working together.

So at $300 million ARR, you have 60 people in the PRD org, in product and development doing $300 million in revenue.

We have roughly so, so just in terms of like traditional engineering and product is probably, is probably 60. So it is still a substantial effort. We were moving very quickly when we were smaller. Now we have to invest a lot in stability, safety. We have to invest a lot in like things like anti-fraud and so on. So the engineering team grows because I mean, vibe coding is not really good for this really deep infrastructure work yet.

But it's by traditional standards, it's a pretty, it's still a pretty tight engineering team even today as you scale, right?

Yeah, I would agree with you because let's say typically a ratio of engineers to ARR would be maybe around 2. For us, this ratio is probably Around 5 today.

Yeah, maybe 2 to 3 times more efficient or something like that.

Yeah.

Cool.

And going back to engineering, it's also very important. The very important trend which I see is that the engineering jobs are getting very nuanced. So there are, for a lot of new product developments, the team now can consist just, just of one person and they can maintain fast pace of developments. So for us, what's important is we help, we deliver time to value faster than any other platform and we have this feedback loop as we see what's trending, we see what users post on social media and using this to improve Higgisfield. And I think that's very important for us to make sure that we have these unique blends of researchers and filmmakers on the team. Most of the team is still, is really centered around kind of those who made commercials and they, and all the materials published by Higgsville, Higgsville YouTube channels, all of that is generated with AI. It's always generated by our platform. That's how we establish trust. So the reason why we're doing full feature movie in Cannes is another way to show what's actually possible with technology today. And we have over 1,000 various tutorials on YouTube to help with this transition from traditional production to AI-native production for creative professionals. Jason M. Lemkin, this is exactly the points What I wanted to bring up, like, we are not building in a vacuum. We listen to feedback on social media, on Discord channel, Reddit, but also we have a team of 80 creative professionals who help our engineers to build. So we also learned that also we made a very controversial bet early on. We made a bet. That's number of people who need social media video, number of people who wanna sell is probably tens of millions of users, but number of people who wanna learn prompt engineering is probably hundreds of thousands. And there is this immersive gap which someone has to close. That's why we started with social-first user experience. What's also very interesting is we see people buying up more and more credits on top of their subscription. So, and that's very natural for all the marketing technology. Like I personally, like, I know like 7 years ago, learned a lot about that from reading SaaS-ter is that like one of the positive things about marketing technology, one of the positive trends is that customers come and buy more and more and more of the product. If they use it more and if they can convert and drive more sales. And we build the trust that all new video AI models are available on Hixfield so that it's one AI video studio for content production. Let me please show how it works.

Let me show you Silvistik. I'm creating a fashion campaign with 3 locations and 1 model. First, I build my character in AI Cast. The platform generates a full character sheet I can reference across every scene. Same with locations. I moved to Madonn, the minimalist studio in Tokyo at night. Now I can start generating. And here's my model in the studio holding the product. But I want to explore other options. So Relight gives me the different lighting directions and color. Angles generates new camera perspectives from the same image. I pick the best one and I move forward. Now I'm ready for the video. I have full control over the camera, the lens, the aperture, the focal length, the style settings for color, the lighting, and how the camera moves, as well as the genre that shapes the pacing. Or I can ask the AI Director. It knows my characters, my locations, and the style I'm going for. I tell it what I need, and it writes the prompts that picks the best settings for this project. I hit generate, and the character stays consistent, the location matches, and audio is synchronized. Now, when I'm ready, I share this project with my client to review and collaborate.

And this is very important. I wanted to pay attention to the last piece. What's important is that video creation becomes digital and that's asynchronous. And that's very important. So the reason why software evolves so quickly is that there is a lot of, there are lots of open source projects and people naturally build on top of each other. Historically, video was extremely gated, meaning that it was— it's nearly impossible to reproduce, to kind of see how these popular movies, how music clips are built. And we see a major democratization across the space as those prompts become available, projects become available. People can see like behind the scenes, they can see the prompts which were used. To make a video and they can collaborate, teams can collaborate together digitally. So to really like, let's say, make videos together. Like historically, what we have seen with incumbents like Adobe is that it used to be like desktop tooling. All the storage was on desktop and it was just very cumbersome process of constantly exchanging files and so on. We bring it all in one platform. What we also learned, it's like these models evolve so quickly. So we work on behalf of our customers to build a trust with them that they will get the best models optimized for the, for specific workflows on Hixel platform. So we ship pretty much every day. Like last year, on average, we were shipping 6 times a week. This year, as we pay more attention to stability, it's probably 2, 3 times a week. And earlier today, there was another major launch where we introduced our marketing agent called Supercomputer. So with all of that, We are excited that we are able to emerge as number one platform in multimedia AI. And there are many direct-to-consumer brands who actually can achieve product and brand consistency, and they are scaling their social media budgets to tens and hundreds of millions of dollars with the AI-generated videos. It's very important to say that in some categories, especially when it comes to mobile apps, AI-generated ad creatives are absolutely necessary. This is the— AI-generated creatives is the only way to get people's attention because there is a strong novelty effect to that and we pay a lot of attention to that. So those use cases around people building content machines are very important for us when we for high-scale, for high-scale video production. But also there is a strong adoption by creator economy with people like Madonna, Snoop Dogg, Will Smith using Higgsville just to create engagement across their audience.

Alex, I want to show my account in a minute if I give it to— I'm going to show my account for fun, if you don't mind. If it's helpful to you guys, when I started using Higgsville right after it launched, I did— Higgsville does a lot. If you look at the top, image, video, audio, supercomputer, which we just demonstrated all of this. I'm a basic guy. Okay. But here's, in the beginning it had, it had a couple of cool things, but this is a great use case for B2B. If you see, you go into it and it has start frame and end frame, and you can update a photo from this event of like the stage and me, and it will just connect them with different models and create a movie from it. There's other ways today you can do it. I'm going to ask Alex some questions, but it was just magical that I could take a picture of, of the outside at SaaStr and this stage and get a 6-second or 10-second video. I'd never seen this before. And what I want to show you, and I still make these videos. Here's one for if we have this new podcast called The Agents. I just wanted to animate it with me and Amelia here. It seems very simple compared to what Alex saw, but I'll just— this is my whole account of all the assets we've built. Fun promos for this event. This one, all different ones. I think it's pretty fun, right? I'm not yet running an ad campaign. That's pretty slick, right? And we can go back in time. See if I can find any other ones. Welcome to the event, everyone. We're so glad you're here.

F—

What? What model is this one? VL3i. I actually think Kling is like my favorite. Here's all the collateral for the event. You might have seen this in our videos. So like, I wanted to make an intro. I don't know if I picked it right. Make a little techy to introduce the event. Sometimes there's artifacts, you rerun it. This is like to promote sponsorships. We built this.

10% fit? That's top of the list. And 5 solid VCs.

This could be our round.

Let's line them up.

Great to finally meet you both.

Welcome aboard.

Couldn't be more excited.

Saastr AI for the win.

Get funding.

Yeah, we have all these tools if you haven't used it. We have this. Alex has used it to val— a startup evaluator that's used over a million times. All the promos. I don't have time. I don't have a team. I built them all here. But when I think when Igso launched, maybe you used one model, right? Is that possible? You used one model?

So yes, we started with our own model.

Your own model, which was Open Source Plus Plus Plus. Is that what it was?

Yeah. Open Source Plus Plus Plus. Exactly. So, and then we realized very quickly that the number of models just increases, basically new model coming every week. And it's very difficult to just follow everything what's happening in the space. And this is actually an opportunity for one platform to consolidate all the models and let's say pick the best model based on each use case.

Yeah. And so now it's much more powerful. You look at it now, you can pick from all the models, so you can make a video or an asset, a short video. And, and what's to me interesting, first of all, you're embracing in a sense your competition, right? In a sense, you have Google Video here, right?

Yes.

You could use Sora before it got deprecated, I think, right?

Yes.

You have your own model. I think you've got Keling and Seedance and WAN, which you know what they are, and I don't even know what they are. On the one hand, the product is more complicated. On the other hand, I can run all of these things in seconds in parallel and use different models to see which makes the better video for me, right? Yeah, super powerful. So talk about complexity and then talk about the business model and why it's not a thin wrapper.

This is a great question. And I think, I think fundamentally there is a question for every business in the world if they are a thin wrapper or not. Because I mean, most of the software is going to rely on AI anyway, right? So the way how we think is there are two major unlocks for us. So first is to empower teams to create together. Like, I think the network effect and collaboration is very strong. That's what made Figma successful. That's what made Canva successful. And we do believe there are many opportunities in the video space. That's probably first. Second major unlock for Hixfield is to help brands to sell more products. So we launched our MCP 2 weeks ago. Today we launch our own agent called Supercomputer, and that's really designed to make bulk of creatives to sell more.

Because we're all dealing with this, right? We all, the LLMs are getting so good, right? We're all a rapper at some level, thin, thick, left, right on top of it, right? So when I pay for Higgsfield, and for me, I know there's two different segments in the market. I'm not, I'm not counting every penny. It's cheap to me. It's cheap, right? But do you, do you mark up the underlying models? Is that a good deal for your customers? How do you think about it? Because like sometimes I actually don't love VO in Higgsfield, but VO I could get in Gemini or I could pay for directly, right? So how do, how do you think about the economics? And it's just a mystery to me.

Absolutely. So today, roughly 40% of usage is not associated with just picking the model, but they use workflows like Cinema Studio, Marketing Studio. So that's a way higher level abstraction. That's probably first thing which is important to say. Second thing is we are still one of the most affordable platforms out there. So for some of the models, we are the most affordable. For some other models, we could be top 2, top 3. But I mean, we, we are moving with the market there and increasingly trying to implement agentic workflows. That's where, that's where we evolve from kind of per token costs to charging by outcome, by video.

So the model, if you just do the seemingly basic stuff like I have, which is leverage the models more efficiently inside of H2O, that's a lower margin product. The upsell is to use it for more cinematography and more value-added workflows like you described. But you can still make money on the basic workflow of marking up the model, right?

Yeah, yeah. So let me just throw like some numbers so that it makes sense. On average, customers on Hixfield spend around $1,000 a year. So it is like, for example, Canva is $200 a year. And for us, we include every, like every quarter, we almost pretty much double our ACV as we move substantially up the markets as we want to attract more Jasons on the platform. The reality is that social media, like, marketing budgets, I mean, many companies have like hundreds of thousands, millions, tens of millions of dollars. So when we think about experimentation from experimentation budgets from even $1 million, it's $10,000, right? And I think eventually everyone would want to try Video AI if that really yields positive ROI on social media. And we want to make sure that these customers, they will, they will be successful on the platform when they try.

And effectively your job is to keep marching them up the value stack, but on average folks are paying you 5 times more than Canva.

Yes.

Now people are gonna start paying more for Canva as Canva gets more agentic with 2.0. But it is a reminder for the theme of this week. If you build— I mean, listen, I made these videos in seconds on Higgsfield, right? And I probably pay more than for Canva. I've been a Canva customer since the 1970s or something like that. I mean, I don't know. I pay $18 a month. I'm sure I pay Higgsfield more than $18 a month and I don't care. But if you provide that agentic value, but the value I get out of Higgsfield, even though I love Canva, is higher. I can build a whole— like, what would it cost for me to build a video like without skills and people? I mean, Infinity. I'd have to hire an agency. It would come back 2 weeks later. It would be terrible. They would charge me thousands of dollars and I would delete it because I would never use it. Instead, I can do this in 60 seconds. And so it just, it's an visceral example that Alex is able to get 5 times the ACV off Canva, even though Canva is mass scale.

Yes.

By having an agentic workflow that, that replaces humans. And honestly, for me, it replaces contractor and agency that I don't have the patience to hire anyway, right? Rather than just be helping me create an asset manually.

This is a good point. So there are several things which I want to say is that we're seeing that increasingly companies bring the capabilities in-house. As you are right, that's like back and forth with the agency is just very frustrating. And that is both budget-wise and timeline. Another huge issue is that it's very difficult to go vice versa, go back and say, oh, I wanted the actor in this ad to look differently. It's just impossible with physical production. But like very often what we are seeing on the platform, customers create variations of the same ad, but just with different actors. So essentially what happens is that, essentially what we are seeing here is that content that's like one social media marketer can make several minutes of commercially viable videos, social media videos a day. And cost-wise, there is also a massive drop in the cost of production.

First, let me just ask, let me ask you one or two questions and then, and then we can break. Agencies, it's a meta question for a lot of folks. Do you enable them? Do you have a Higgsville offering for agencies? Because you're disrupting to agencies, but also if I have budget for agency and they can give me 10 times more assets faster, it enables agencies too. So how do you, what's your interaction with creative agencies?

So this is a good question. So first part, which is creative agencies, is this is the number one category on the platform. We love to bring up examples of brands building Number one customer are agencies. Agencies for sure. Creative agencies is number one. We are excited to see more and more direct-to-consumer companies kind of using Hixel directly.

Yeah.

But this is still an emerging trend. Like if we just talk specifically about $300 million ARR, most of that's like almost 70% are agencies.

Oh, I wouldn't have guessed that. I would've guessed earl— I mean, I would've guessed you were getting there, but your early adopters were webheads and AI nerds and people like that, but it's actually agencies found you early because it made them radically more efficient?

Because I think all agency, a lot of especially creative agencies, they have been mostly struggling, frankly, and they use AI as a new opportunity to sell, to sell. And I think that's, there is definitely a lot of demands. We have seen Super Bowl ads generated with AI. We have seen many Olympic ads, Christmas ads like Coca-Cola Christmas ad. Was generated on Hixel. So I think there is, there is just a lot going on and there is clearly, there is clearly a lot of demand for innovation. And also all these companies, they have experimental budgets, like millions of dollars. So it's natural that they are all trying AI.

And I'm just a solo user, so I don't see it. When agencies use you, and I think how go-to-market channels change in AI is interesting. When agencies, because you're also disrupting some agencies, you're enabling agencies that use Higgsfield, $70, you know, $200 million of revenue, but you're disrupting agencies that used to charge $10,000 for something that you can do in minutes. Do they hide it from their clients? Do they white label Higgsfield? Are they worried their clients will see it's on Higgsfield and feel like they're being overcharged?

This is a, this is a good point. So this is the second part of the markets, which are larger agencies. Larger agencies, they make money. From kind of media consulting. That's kind of first kind of McKinsey, but for, for marketing, right? And the second part is paid, is paid marketing, like basically media buying. So, so his video AI and Higgs field did not change the way how media is bought. This hasn't happened yet, but with our supercomputer products, we have direct integration to Meta MCP and some other MCPs as well so that we can play broader role, not just from ideation to creation and collaboration, but also we want to add distribution piece, basically distribute ads across different ad networks.

Got it.

And inform clients what works the best.

Cool.

For, just because I haven't really chatted with many founders about it, for these agencies, it's 70% of your model. I know the team is only 120 people at $300 million revenue. Revenues, I would say.

Yes.

Do you have a dedicated partner team, enablement team, people that are making these agencies that maybe aren't at the cutting edge successful with these tools?

Yeah, we're very, very actively building for deploy engineering team. You are right.

Your own team of that, yeah.

Yes, absolutely. I think what we're seeing is that the demands, sort of like there is a lot of interest in customization, and higher volume content creation.

Yeah.

We have seen, I don't know, like I think out of top 30 media organizations in the world, at least 10 build internal tooling because they feel that everything available out there is not good yet. But to me, it feels like this is actually a signal to us that we should make our products more customizable and like our enterprise, and like we really double down on enterprise adoption.

Okay.

And maybe one last high-level question. I really believe you guys are doing 6 releases a week because the product has changed so much since I've used it, right? Some of the stuff you did in the beginning didn't work out that well, right? Or you deprecated it or stopped investing in it. What sort of, I mean, maybe it's just usage and mouths and wows of DAOs, but how do you decide quickly what to abandon, what to put to the side, what to hide in the nav, where to go deep? Because this product radically evolves. You haven't just Maybe missing part of the story, right? It's not like you went from 0 to $300 million with the exact same product.

This is absolutely true.

It's— I still kind of am in the past using maybe Higgsville 2.0, but 95% of folks use a radically different product than when I started. So how did you— how do you pick that? Look at the data, decide what to do, decide what to cut?

Absolutely. So we really saw maybe March last year that there is an interest from top creative directors to use AI, but camera control does not exist. So they just immediately reject it. So that was our first innovation. Then we kind of went to our roots. So I sold my previous company to Snap where we built the face filters basically, and face filters is just kind of one-click experience. So we did the same for visual effects. And this helped us to get to $10 million ARR within 8 weeks or so. Then the interesting part for us was to also, I mean, we noticed maybe in July that some people start to make commercial projects end-to-end with AI. And this is where like kind of AI, video AI is no longer a toy. It's not just a tool kind of for some fun effects. Kind of face masks or whatever, it actually brings a lot of commercial value and we reoriented the whole company around that. And now we reorient the whole company again around Agentic because as I mentioned, like, Agentic workflow is like, it's like marketing workflow is extremely repetitive. Every day it's important to understand the trends which are relevant, which are irrelevant, what worked well yesterday, then decide which videos we need to make today, how it's different across different channels, what's the difference, what's the audience like overall sentiments, and then make the videos, post and rinse and repeat every day. And that's very important to stay relevant on social media. So, and I think kind of agentic actually, I mean, like our agentic workflows is our first step to cover the whole marketing Workflow end-to-ends. Okay.

That's amazing. One last wrap question, just at a high level for founders over stuff, because this is a, this is a, I think an over-discussed topic, but what is ARR? They said $300 million ARR, but this isn't all Salesforce subscriptions at $150 a month per seat. How do you define it? What does it mean? I think you're pretty honest and direct on this, so just. Just give us a snapshot of what you think ARR today is in an AI and agentic world.

Absolutely. So I think there are two subcomponents. First, I think it's important to take annual subscription and divide by 12 in wherever you, how you measure ARR. It's just very important to do and kind of be intellectually honest. And I think a lot of kind of, you know, like kind of wishy-washy stuff. Starts with credits because if someone uses on-demand, then there is a question of like where it all gets attributed, right?

Yeah.

So like for us, we, like for us, for 300 million, we see the on-demand usage for specific class for weeks. We see, we take the monthly subscription revenue, annual subscription revenue divided by 12. Sum it up altogether, multiplied by 12, and that's how we get the result. But I think on-demand usage is the most tricky one.

Yeah, but you're using— but you're still using the last 30 days of revenue in essence and multiplying it by 12, right?

Yes.

So—

But it's revenue. It's not just sales. It's revenue. What's important?

Booked revenue. GAAP revenue or—

Yeah, yeah, revenue. Meaning that we'd take We take like annual subscriptions or annual contracts and divide by 12.

Sure.

Which is important because some companies, they take whatever like cash they got and multiply it by 12. This is, I think, well, that's, that's, but, but okay.

And, but if $300 million, how much is on annual versus monthly versus the, I mean, do you have a lot on annual?

Look, annual is a very substantial, I mean, like, look, in terms of the number of subscriptions. Yeah. It's not high, but I mean, it's definitely like 40% of total revenue for sure.

I think some folks are stretching the definition of ARR so far it stretches credibility. But also, I also think sometimes people take this issue too seriously. If you're doing 300— what's 300 million times 12? I'm getting tired. 26 million or something like that, right? If this month you're roughly doing 26 million, honestly, then you have a $300 million revenue rate, right? It shouldn't— we're making this too comp— whether it's credits. Yeah, I think if you're giving 80% marketing discounts at zero and claiming it's revenue, it's pretty suspect, right? If it's cash in the door or cash properly recognized for accounting, I think we're— what am I missing, Alex? I think we're overcomplicating this. Like, that should be your AAAR.

Yeah.

You know, close enough to what your real revenue is. Whether it's one-off, 10-off, 20-off, annual, weekly, I, at some level, I don't care what you use your rep, just show me the money, right?

Yeah, absolutely. So for us, I think what's, and I also spoke a lot about that with Stripe team, frankly, a lot of businesses are run on Stripe. Stripe also has the orchestration across the various payment systems. And I think, I mean, in the end of the day, I think very soon we will be sharing Stripe dashboards because, you know, like It's just kind of this, otherwise there is just a lot of discrepancy in definition.

Stripe says $25 million this month. I call it $300 million.

Yeah, we call it the same.

For me, right? All right. Incredible success story. Let's give it up for Alex and thanks.

Thank you.

One, one we can be proud of.

Thank you. Thank you.

Thanks for doing this.

Thank you. Thank you for having me.

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