Telly Founder Ilya Pozin Previews 2024's First New Features

Welcome to another episode of Strictly Business, the podcast in which we speak with some of the brightest minds working in the media business today. I'm Andrew Wallenstein with Variety. Want a free TV, and not just any TV, but a fifty five inch top of the line stay to the art screen. You'd probably have to pay more than a thousand bucks if you wanted to hang one in your living room. Well, my next guest has an interesting proposition for you, but it comes with some strings attached.

Alia, Hey, thanks for having me so.

As I referenced to the top of the show, you have been given out free TVs. You pledged in May you were going to give out about half a million of them by the end of the year here in the US, and as we sit here having this conversation in late December. Have you reached that goal?

You know, we've we've set out to build this product. We've built an amazing team, and we've we've put.

Out thousands of thousands of units.

And you know, one thing we've done that's really really different is when we announced this company publicly in May, we had an astonishing number of people that were interested in our product. Honestly blew away our expectations. We had nearly nearly half.

A million people are currently on our wait list.

We spent zero dollars in marketing. We had to sign up every single second. The types of people that signed up were mirror the US population, so they're you know, everyone's very interest in the high quality product that we've built. The other thing that happened was we attracted manufacturers that wouldn't even return our calls in the beginning, right, these are the top tier ones that you know, make the best products.

In the world, and as a startup, they don't really give you the time of day.

But once they saw the tremendous response the consumer demand, we started to have, you know, more serious conversations and we thought, you know what.

Let's take advantage of that.

Let's slower roll let's send thousands and thousands of units now which we have, Let's kind of iterate and build this product together and have a much bigger and stronger twenty four.

Well, my guess is the the Samsungs of the world or other companies that make the kind of screens that go into Telli probably thought you were crazy, I mean giving these screens away. Now that you've proven that you could get these screens out the door, what is what are you going to do in twenty twenty four? Are you going to now you know, how many more screens do you plan on giving out? And are you going

Yeah, great question.

Now people assume that free is just like an initial offer, and then adventurely we're going to start charging for our product.

It's always going to be free.

We're planning on delivering a lot of units in twenty four. And if you look at the TV today and I know you had a chance to see, it's it's a state of the RTV. And don't let the price point of free throw you off.

Right. This is not a low budget TV targeted at low income folks. This is this is.

A high MTV And as you said in the beginning of your program, right, if we sold this thing, it will be.

Well over one thousand dollars.

It comes with those screens, that's got a sound bar made by Harmon cart and it can do who calls on Zoom and play amazing music and through Spotify and you know, and so many more things that's got to pull voice assistant built in. These are all things that your TV just simply can't do, right, And that's the

Right.

So at Telly, we release software updates every month, and this thing improves time.

Over time over time. Right.

So, you know, we didn't have a voice assistant a few weeks ago, right now we do. We have a karaoke remote coming soon. We would be able to pick up your remote control and sing into it, right, and so many other cool features that will make this thing by far the state of the art device. And truly kind of the heartbeat of the living room, the main device in the home. And our goal here is in the same way that the iPhone became, you know, the main device out of the home, right, the main device

Right, And it kind of missed the mark.

TVs haven't really changed in over ten years, right, and it kind of stayed the same. And our goal is to reintroduce this thing and bring the smartest TV in the market.

And this thing is just going to take over your living room.

Well okay, now, obviously some people listening to this are going to be saying this can't this is too good to be true. So we have to explain a few things. Number One, Telly is no ordinary TV. Attached to this great fifty five inch piece of hardware is a second, smaller screen at the bottom that is always showing commercials. You cannot turn it off when the screen is on. Number Two, if you are privacy sensitive, Telly may not

Yeah? All good questions.

So, first of all, everyone's everyone's qualified to get a Telly, right, as long as as long as you sign up and you opt in to our terms of service, you're qualified to get the TV.

We don't. We don't select people based on any kind of bias, right.

So, so, and from a from a data and privacy perspective, you know, we're one hundred percent privacy first as a company. If you look at what's happening in all the other TVs when you purchase, you know, any other TV on the market, you're buying the.

TV and they also sell your data.

They deliver advertising, right, and our consumers recognize that that revenue is being double dipped on. I'm already paying for it, and I'm my my data is being used there selling advertising. You know why am I paying twice? And they're realizing that with Telly, we're just upfront about it. We're completely transparent about it, and you're right. At the sign up process, we ask a number of you know, demographic and psychographic questions that that are.

That are utilized to target advertising.

That are specific to you, right, because all ads aren't equal, and the ads that are shown to you are could be different that are shown to me because consumers want advertising, but they want that advertising to be relevant.

Right.

When when consumers hate ads, it's when they're when they don't, they don't, they don't belong and they you know, they just they shouldn't be there and they interrupt your experience. But more importantly, that bottom screen that you mentioned, yes, there are.

You know, when you watch the top screen, the bottom screen comes along with it. But if you look at.

Any any consumer feedback and any of our data, people love it. It's not a distraction. The best parallel I can give to It's kind of like the dashboard to your car. Right, the top screen your windshield, the bottom is your a dometer, your speedometer, your.

Radio, your nav.

You know, we show actor information then news and weather and sports scores, so you know, if you're watching your favorite sports team playing on you know, on a broadcast network. We can show you scores around the country kind of like the lower third on the bottom screen, or a newsticker, magical browsing Netflix, and your Rotten Tomatoes reviews pop up right there in the bottom right. So the first and foremost the priority of.

That screen is to enhance your content viewing experience.

But yes, there is advertising, and that advertising is there to support.

The fact that the TV is free, and we're very upfront about it.

You're opting into that, and we're fully transparent, right, and the consumer understands that, and they understand the value stream understood.

But I think people myself included, are going to wonder, how are you making money if you're giving these things away? It's not coming from the consumer, or is there some other revenue source, or is this the kind of thing in sort of you know classic you know, Silicon Valley style, you know, is it just about scaling and you'll worry about making money later? What's the business here?

Yeah?

No, we're making money in the same way that any other TV manufacturer makes money. Right when when a Visio or Samsung sells you a TV, there's hardly any margin on the hardware anyway, there's pretty much no money for them.

To be made there.

Right, We're just our business model is just better that we're able to make more money in the same business streams, in the same revenue streams that they are. So it's no different, right. TV makers are monetizing data, they're delivering ads, and we're doing the exact same thing, except we're not selling your TV.

And once again, if you look back at the playbook of Pluto, same idea.

We don't have to charge your subscription fee and deliver advertising to you like cable companies do. Pluto has built a very successful and very sustainable business on just ads alone, right, And so initially we as a company pay for the TV, right and we deliver it to you in your home. TVs are used for a very very long time, right. The average American family watches over five and a half hours of television every single day. The primary TV is

Right, So I think that's that's where our business model works.

Is we're able to deliver relevant advertising, performance advertising, not just brand awareness advertising, and do it in a way where build a sustainable business, where we're able to give away the hardware and then you have a clear direct value exchange with the consumer.

Now, I want to get into some of the new stuff you've got coming, because there's now going to be some sort of new interactive features coming to Telly, Which isn't to say that there's nothing interactive. I know you guys have some QR codes that you're playing with, but let's talk about some of the browser functionality that you have coming to tell you, Yeah.

This is super excited about this one. So typically when you.

See ads on TV, it's a it's a fifteen second or thirty second commercial sandwiched in between content, right, and from.

A brand perspective, that's a great way.

To get awareness for your product, but it's not a great way to get performance out of it. Right when that add is in between content. As a consumer, you can't wait to get back to the content, so people don't really engage on that ad. There's not enough time to take your phone out to scan up your RCO or maybe take your computer out and go to a website or something. Right for us, performance is critical, and because we have that screen on the bottom that's there the entire time.

Let's say you're watching a program.

And then ad for I don't know, Toyota Tundra comes on the on the screen on the main screen, we can show you a relevant ad on the bottom screen or a local Tundra offer in your local market. And what's coming very soon in aut a month is you'll actually be able to take your remote out and click that ad and a full browser open, so you could schedule a test drive, you could purchase a product, and an e commerce website, you can download an app, you can you know, tune into a program, opt into whatever.

And people have been.

Trying to kind of bridge this gap between performance and awareness and living room, but let's be honest, it's never really going to be done on a single screen, right because because once the content comes back and you have fifteen seconds to engage, but because we have this dedicated screen on the bottom. The odds are persistent and there's plenty of time to engage the unit and take out the remote and take active.

But wait, there's more, as they say, in terms of interactivity, T commerce, which is something that has been bouncing around the margins of the television industry for decades. Now, you guys are also coming to that's also coming to Telly. Now what are you well, first of all, explain T commerce for those who don't know what it is and how that is also coming to Telly.

Yeah.

So, so transacting on the TV is something we've all been doing for a very long time, right, right, say you want to find a favorite movie, you want to buy them on you know, on pay per view or through Google or through Apple, right you can or Roku, you can buy. You can find your favorite movie and purchase it for two ninety nine, three nine nine or what have you, and of course sign up for your favorite subscription service things like that.

But actual purchase of products.

Has been something that typically happens on your phone or your computer, right, But it doesn't really happen on TV.

Even though we buy movies, but we don't buy products.

The browser is going to bring that as well as some of the native integrations we're doing with some of our upcoming advertising partners. Right, So imagine you're wall I don't know, it's twelve thirty, You're watching a football game. It's sponsored by Pizza Hut. We show you an ad for Pizza Hut on that bottom screen. You take your remote out, you click that ad, and you're purchasing a pizza without interrupting the game right there on that bottom screen.

Right. It uses the data and it's synchronized.

Well what's happening up top, but it's also independent so it doesn't disrupt the experience.

So, knowing kind of your location and where.

You are and maybe your favorite pizza topics, we can get a consumer to easily purchased a pizza under.

A minute's I could totally understand how that could be something that would be a real game changer for t commerce, which, let's be honest, we've been talking about, you know, the proverbial example of you know, Jennifer Aniston sweater, which is people have been talking I think since the year two thousand.

I look this up.

Was when people talked about, you know, you should be able to click on that on the screen and buy that. But here we are twenty three or four years later, and it's never really got in mainstream yet. Maybe it does take a second screen to do that.

It has to write because if you click on it, where does anything show up?

Right, You're going to overlay your friend's episode.

That's a horrible experience and it just that doesn't really play well for the consumer or for the rights folder frankly of the content right, But for us because there's a second screen. It's once again it mirrors the idea that over eighty percent of consumers when they're watching TV are looking at a second screen already on their phone. Right, they're right there, they're looking they're distracted to look at

We'll be back in just a moment with more with Ilia posen CEO and founder of Telly. And we are back with the CEO and founder of Telly, Ilia Posen. Ilia talk about the funding it took to get Telly off the ground.

We do have some amazing investors.

Uh, you know, I think ones that a lot of your listeners are familiar with, you know, ones like kind of rich Gienfields for example, fun Light Shed who's an analyst in the space.

He's one of our lead investors in this round.

And many many, many others that are both in media and advertising, like the founders of Spoducts that sell their copy for our billion to Magnete and so forth. So we've got great people, uh that have invested in company so far, and a lot of and a lot of investors waiting to continue funding us in our future rounds.

What is it going to look like in terms of do you need more funding to keep going anytime soon or are you good where you are right now?

Yeah, that's that's a great question.

The way startups are typically funded is you know, to protect shareholders, right, employees, founders and investors, you always raise capital in multiple rounds. It's kind of like a game of football, right where you you get it first down, you move the change forward, and then you keep going.

You don't want to over over.

Raise too much capital early on in your business because you're going to take a lot of dilution, So you want to you want to raise some capital. You want to achieve your milestones, right, then you want to raise more capital at a higher evaluation. And we plan on doing that, you know, for for the unforeseeable future. I mean, if youve know, if you look at public companies, they're raising capital continuously from the.

From the public market. So that's that's kind of a standard order of business, if you will.

Of course, you know you've been down this road before in Pluto, which you co founded, and that company went on to get acquired by the company that is now known as Paramount Global. Got to wonder, you know, is tell you something you're committed to taking on an independent path or is this something that is bound to perhaps get acquired by one of any number of hardware giants out there that's already in the television game?

Yeah, I think you know, any good entrepreneur will tell you that they're never building a company to sell, all right, Right, And even when Pluto was was when we got an offer from at that point it was Viacom, you know, Viacom to get acquired. We weren't in the market to sell, right they We actually went went to went to Vicom for.

A confident deal and they gave us attention.

So planning on doing the same thing here with Telly, where where we have.

An opportunity the market's you know ours for the taken.

We've got great momentum, great leads, huge consumer demand. We built a put out a build, and put out a great product that everyone's using for many, many hours every single day. I think I think would be foolish to go out and try to sell this company early in the market right now where we want to stay independent as long as possible.

Well, here's the thing, as I look at what you guys are doing. To me, the surest sign of success for Telly is if we see any of the established players out there copy what you're doing and which the natural next question is what kind of patent protection do you even have on this, you know, second screen configuration that you have out there?

Yeah, great question. We look, we fire filed a ton of patents on what.

We've built, and that's something we're continuously doing. But at the end of the day, you know, you and I both know that patents are just kind of ammunition for lawyers to build more and more hours at they're extremely high rates. Right, I think in today's day, there's technology, whether it's software or hardware, is easily not easily replicable, but it's much easier to replicate something today than let's say ten fifteen years ago, right, and you see copycats

We define this fast category. And now there's.

Over a dozen competitors and literally the exact same thing.

But Pluto is by far the leader in the space.

Right, They've got market share and you know what we're doing or whatever.

Recommend to any any startup or any.

Entrepreneur in the market is to build it, run as fast as you can and maintain that that first mover advantage and maintain that lead.

And that's what we've got here, I think.

I think naturally, when you look at other hardware makers in the space, imagine one of them taking a product that they are selling for decades and making it a free right, what would the stock market do to that company? I think I think it wouldn't send the most positive signal, Right, So I think I don't think it will be easy for a company to go out there and just slash their prices just on a on this premise that this little startup Telly is out there and kind of nipping

I also wonder if you know, we could see the day where you actually add a third or a fourth screen. I mean, who knows what sort of forces you're you're unleashing here. Well, I mean, the thing is, uh, you know you. I wonder if what you're doing here really isn't that different than what we see on news channels with tickers and all sorts of kind of you know, dual screen approaches. It's not that far afield. You don't even necessarily need to have a multi screen panel approach.

Yeah, I mean, I think the second screen really gives such a big advantage not only on the business model right on advertising, but just on the consumer experience. Like one of the features we have coming up that I mentioned to you is this watch party idea. Right right now, we have zoom right, so we have it by the way you mentioned our camera. We don't use the camera whatsoever for our own for business purposes.

The camera is just there for the consumer. There's a shutter on there.

When you want to watch something, it asks if you want to open the shutters. So it's there for gaming and zoom calling and things like that.

But we have zoom right now on the big screen, but one thing we're.

Doing in one of our next releases is moving zoom to the bottom as an option. Right, So, imagine you call your friends and family, two, three, four or five friends that live across the country and you tune into the same sports game and you're not watching TV together right from from across the across the country, and you're synced up and you're watching the same game or the same movie. That kind of experience can't really be done on a single screen.

And imagine if a single screen experience.

Where you go out and buy a fifty five inch or sixty five inch TV and then they're squeezing back your content and it becomes smaller. You're kind of pissed off as a consumer, right, you just spend all this money on a on a TV and they're making your content, you know, a screen size smaller than what you paid for. I just don't think that's a good experience, to be honest.

Speaking of the game. Sports betting is obviously something that's becoming bigger and bigger in the sports TV business. How does the second screen that you have come to bear in something like this, Yeah, I.

Mean it's sports is a perfect environment for this dual screen experience. So you're watching a game, right, You're look, you can see odds on the bottom screen, You're seeing fantasy sports stats from from other from your players, from other teams.

You're looking at sports corgor across the country.

And as you can imagine, all the big sporting sport.

Betting players in the space are talking to us now.

About betting natively right there on that device. And once again, it's getty close to what a mobile phone experience looks like.

So you could do it right there, and you know.

Imagine without without taking your eyes off the game, being able to place place a bet based on the odds are based on the stats that you're seeing right there on the same device, but on the separate screen.

It just makes that experience so seamless.

Last question, you know, twenty twenty three obviously is the year Telly put itself on the map. What is twenty twenty four hope? What do you hope twenty twenty four will be for Telly?

So because we decided to do this public data.

Period in twenty three, we've really got a chance to build out the product that we want. And if you look at the data and the usage of how consumers are using this device and the customer satisfaction rate, we have a ninety nine point nine percent on customer set actionary and people are using this thing for hours and hours every single day. All the signals are there for us to scale. And that's exactly what we're going to do in twenty four. We're going to scale. Our demand

Well, this is going to be quite a growth story to watch. I'm glad you came here to tell it. At the end of twenty three, we'll have to have you back at the end of twenty four we could see how far the growth story has gone.

Ilia.

Thanks for taking the time out, Thanks so much for having me, Thanks for listening. Be sure to leave us a review at Apple Podcasts and Amazon Music. We love to hear from listeners. Please go to Variety dot com to sign up for the free weekly Strictly Business newsletter, and don't forget to tune in next week for another episode of Strictly Business.