How ElevenLabs is Building Consumer Apps on its $11B Voice AI Platform

If you think of a percentage of ebooks that get converted or recorded into audiobooks is sub 5% and it's extremely low as you kind of look at the long tail of markets and geographies around the globe. And so the way I like to describe this product is really if a traditional audiobook is one voice that's recorded to read one book in one language, this is really any voice reading in any language and reading aloud any book that you want to be able to bring to life. We really want to bridge the two, which is telling the great stories, but also pairing them with these iconic voices that you can only now get as a result of our technology. And hearing a story told in a voice that you might not have imagined before has been a pretty unique part of our growth at Eleven Labs.

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My guest today is Jack McDermott, who leads mobile growth at Eleven Labs. In this episode, I talked to Jack about the unique opportunities and challenges of building a consumer app like Eleven Reader within a foundational model company. About the distribution strategies that Eleven Reader has used to attract its early adopters. And about the first principles-based approach that Jack and his team have employed to optimize subscription pricing and packaging as AI is rapidly changing monetization strategies. All right, welcome Jack to Subversive. I'm excited to have you on today to talk about 11 Labs and your consumer app that your team has been developing within 11 Labs called 11 Reader. Um before we get to

that though, why don't you just introduce yourself and tell us a little bit more about your professional background? Yeah, for sure. Thanks for having me, Phil. Um so I'm Jack. I lead uh mobile growth for 11 Labs today and stumbled into tech. Uh story really began when I was younger and growing up and still today with a stutter and beginning to move into tech because I sought to solve my own problems. So I uh when I was in college, I started to build and launch my own mobile apps um at the time. This was back in 20 uh 2011, 2012. So the App Store was still relatively new.

Um selling $29 one-time iOS apps at the time. This is well before IAPs and subscriptions. And I just really fell in love with the idea that you could build and craft and grow something that was so kind of innate for me and then to be able to serve thousands of others that way. So that's really how I got into the the tech space and and I stayed in kind of that that ed tech sphere for the first part of my career. Um was the first hire at a company called Panorama Education that builds um software and analytics for school districts. I did that for um about 5 years. I think they're um about 400 employees or so today. Um took a brief brief detour to go to business school and then came back and and worked at a startup in the ed tech space that was acquired by by Chegg called Thinkful, which is a coding boot camp.

And the idea there that brought me to Chegg was to to take a big bet and to try to scale and grow a coding boot camp inside of Chegg. And this is the time of gotten income sharing agreements um and to build on top of Chegg's Chegg's reach. Um, so I led growth teams there as well, both on the B2C side and, um, in some kind of unique B2B to C partnerships with platforms like Guild. So, it was a wild ride, but that's really where where I got my my start. Yeah, well, and I'm glad you brought up your edtech background cuz I spent almost 4 years at Quizlet working with the growth team there. And so, we have some common background. I'm curious to hear obviously Chegg is a company that has experienced a lot of disruption as a result of artificial intelligence. They were originally an offline textbook rental marketplace, but then they moved into online textbook solutions and other more advanced study modes. But then as

ChatGPT and Claude and other LLMs have come along, that has created uh quite a bit of resistance for some of these edtech products that are catering to students cuz students just go directly to the to the large LLMs now to get what they need. Um, how how has it been

transitioning from a company like Chegg to a company like Eleven Labs, which is very much, uh, taking advantage of the AI wave as part of their core business model? Yeah, it's pretty night and day in in some respect. I mean, I was at Chegg, um, during the time period and it has certainly become a bit of a poster child when it comes to AI disruption in the last 4 years. And that was a really wild experience being there and and being inside of that that, um, and and feeling how quickly technology waves can shift.

And this one more so than than a lot of others in the past. Um, but yeah, I was already at Chegg working on a future business bet, right? Coding and skills-based learning and trying to expand beyond just traditional study homework help, um, when ChatGPT launched. And it became very clear from the beginning that that students were beginning to turn to ChatGPT to ask questions, to get instant feedback, to get free answers, which really was the core value proposition of of Chegg study product, which was some, yeah, you know, 70 80% of revenue directly from students. And so, you then kind of compound that with a lot of the changes in in search and in organic search where Google's beginning to index a lot in AI mode to be able to fulfill answers right on top of the the search request. And so, you you really just felt this wave of disruption that came and it doesn't care how well prepared or unprepared you are to be able to hit a

high score. So, yeah, I mean, I think it was a really remarkable time and knowing that Chegg had already made one platform shift leap and and going from physical textbooks to digital kind of SaaS. And um and it I think it just gave me a lot of respect. But at the time, a couple of years ago, as I I took a step back and kind of reassessed where I wanted to be in in my career, it was definitely a question of do I want to be on the side of a disruptor or a disrupted? And um and for me, you know, it it really took a a bit of a risk at the time to take a step back and go and work on a smaller company at the time.

Um it was unclear when I joined Eleven Labs if AI voice and AI audio could could stand on its own and and really build a a big and enduring company. And it's been a great ride at Eleven Labs uh since. So, let's jump into that. And at this point, Eleven Labs is a pretty big company. It's one of the fastest-growing companies in AI. It's been very successful. And we'll get to the consumer apps later, but it started as this horizontal API platform for AI-powered voice.

Can you tell the audience, for those who don't already know, what what does the core Eleven Labs business and product do? And then, what drove the decision at some point to start spinning off these vertical consumer apps on top of that platform? The core of Eleven Labs and what I think Eleven Labs is most known for is having the most lifelike and realistic AI voices. And so, this is kind of in the beginning your your traditional taking text and converting it into speech and really doing that on the back of AI and transformer line architecture that allows you to just really embody and get lifelike both voice clones um as well as things like dubbing and a variety of other use cases that they really make voice the dynamic kind of use case that that it is. That's kind of where where 11 Labs has been and of course it has been able to build out from there. So, now doing of course not only text to speech, but

speech to text, uh sound effects, as well as music models that we all build at the foundational layer. And then beginning to move more and more into a platform play to be able to to help you orchestrate voice agents or to be able to use voice AI inside of your your platforms or products as well. I think, you know, from from the moment I joined, it was one of the first things I asked, which is why is 11 Labs trying to think about building first-party either consumer or creator apps themselves.

And, you know, I I posed this to the beginning to Mati our CEO and um and he had a really clear way of thinking about this, which is that that ultimately our goal and our aspiration is not just to build, you know, great research that underpins a lot of other products and applications, but it is to really build a generational company and and to us that means one one of the requirements is that you also build on top of your own research and breakthroughs and you build out the product layer and you build a brand that both uh B2B and B2C that people know and love. And so, from a very early point, it was clear that we wanted to go beyond just being an API that that was called upon and and really build great and exceptional products in-house as well.

So, let's talk about some of these creator and consumer apps. What what are

the specific apps that Eleven Labs has built on its platform? And then let's talk a little bit more about Eleven Reader, which I know is one of the apps that you've been more involved with. Yeah, of course. So, today we offer uh two apps and we have a a consumer-focused app, which is the Eleven Reader app, um which really offers the world's best voice models in a way that brings anything you want to read to life. And so, the way I like to describe this product is um really if a traditional audiobook is one voice that's recorded to read one book in one language, this is really any voice reading in any language and reading aloud any book that you want to be able to bring to life. And so, we think that this is a really kind of a unique opportunity in time to apply voice AI to this type of experience.

Uh and then of course, the the other app that we run and that our team builds and grows is the Eleven Labs app. And this is our flagship mobile product. And I want to call it a companion product to the web because it um it's growing extremely quickly and and can really make use of a lot of the unique parts and attributes of of being mobile first. And so, it gives you the ability to create voice, video, image, uh sound effects on on your device and to be able to do that in a way that creators are trying to to grow and scale an audience on on of course platforms like TikTok and Instagram. So, between the two apps though, I think that the commonality is really our view that between being a creator and being a consumer is beginning to blur a little bit and that you can actually create your own type of audiobook-like experience or that you can consume voice and video and image in ways that allow

you to create new technologies and and new media as well. Yeah, I mean, I couldn't agree more. I feel like

a lot more people are becoming creators over the last few years and I I think that will only accelerate largely because technology is just making it easier, uh more affordable, and more lucrative than it ever has been before. So, let's talk a little bit more about that in the context of ElevenLabs specifically. Who are some of the early adopters of ElevenLabs reader and what sort of content do you find them either bringing to the platform themselves or using on the platform through your ElevenLabs reader marketplace?

Yeah, so the app first launched in summer 2024 and the idea from the beginning was pretty straightforward. It was working backwards from first principles of what we have these incredibly powerful AI speech models that are primarily being accessed through an API, um but what would it look like to be able to make that available in a consumer experience? Um and so from the beginning, the the the one of the first ways that became very clear to ElevenLabs was the use case around audiobooks. And there's a story of Mati and Piotr who who launched the company, who put up a a uh essentially a proof of concept landing page that just had probably a 200-character wide text input box and it would allow you to convert that amount of text into speech and they they began to get a little bit of traction and saw that there were, you know, rows and rows of entries that were, you know, hundreds of thousands of

characters long. And when they they looked at these specific input fields, they they found that they were a lot of times people's own books and manuscripts that they wanted to be able to convert into audiobooks to be to be able to sell or be able to distribute or be able to hear themselves. Um so the beginning, we we found really good early product market fit when it comes to the use case of kind of underserved long-form audio. And so, to me, that often looks like fan fiction or web novels or really any type of long-form stories that aren't yet converted into a a professional audiobook.

And our voice models being kind of fluent and lifelike and highly emotive can really help bridge that gap. And so, being able to convert a fan fiction that you may love on the internet into an audiobook for I'm going to be able to play on a commute or be able to play at home was kind of one of the core first ways to be able to put an into the door in this market. Got it. And so, talk to

me a little bit more about what some of the unique opportunities and challenges are of building a consumer app like 11 Reader inside a foundational model company like 11 Labs. I'm sure there are many advantages, uh but what are some of the challenges that you face as well? Yeah, I can talk a little bit about both. So, I think first is I really love it. It's um I think of a consumer, and I know we've talked about this, Phil, is a little bit at times like playing on hard mode. Um but I do think that doing it inside of a foundational model company that's building at the core of speech and audio uh is a big tailwind that gives our teams just a lot of capabilities and a lot of opportunity to to draw upon. I think one thing that's kind of unique about it is the first thing is we're really set up as a series of internal startups. So, even though we've grown quite quickly at 11 Labs, we're still

really a series of kind of teams of six or eight people that work on a specific product or on a specific opportunity. Um and so, I think the the first thing that we get within that is really, you know, one opportunity is early access to these models and a deeper understanding of kind of their capabilities and edges and frontiers of of each one. And and also, it's nice to have essentially an unlimited budget to be able to throw at these models and be able to really push them to see what type of experiences that we're able to bring into a consumer product experience. So, that's one.

I think one thing that's kind of unique, too, is it it begins to create some internal flywheels where our internal product development teams are almost some of the most intensive consumers of our APIs and our models. And so, there there's a really valuable feedback loop in helping to push and provide feedback into fine-tune what we get from an API and be able to improve the the experience that you get as a developer, um or being able to assess across a wide set of data around adoption, latency, um and then of course, it goes both ways because we can feed that right back into the model. Um so, I think that that's one of the the ways that we've really been able to use this approach.

Well, I I think a challenge to call out is it's just of course really hard to do a lot of things well, and it's hard to be, you know, fundamentally a horizontal company that builds um a lot of products um on top of a wide set of research um that's doing everything from from, you know, a consu- a consumer apps to partnering with some of the biggest enterprises in the world. And and I think it takes a deliberate amount of focus and the right culture to really get that that right, but um I'd expect more and more foundational model companies to be building products, being able to adapt to consumers. I mean, you're already seeing this, right, with with Claude that's taking Claude code and and adapting it into kind of a Claude co-work experience, um to be able to make it even more accessible to consumers. We're even with ChatGPT health, which is kind of a um a dedicated area to be able to get at

health data, um which is built on top of acquired startups, right? So, I I think it's unclear if that's going to stay with with code red mode, but I think um the the opportunity to have a lot of these flywheels and fulfilling loops inside of a foundational company, I think it's been a big opportunity for us. This episode is brought to you by Paddle. Today's fastest growing apps are multi-channel. They use web monetization to reach new audiences, improve attribution, and boost margins. But, selling on the web complicated fast.

Managing currencies, taxes, fraud, and disputes gets increasingly difficult as companies scale. Paddle solves this. As the merchant of record for thousands of apps, including Runna, GoodNotes, Codeway, and HubX, they take on the complexity of web monetization, so you can focus on growing your business. Learn more at paddle.com/subversive. Yeah, that makes sense. And you mentioned a couple of the examples of vertical apps that labs like OpenAI and Anthropic have built. Um but, it makes sense that you guys are sort of dogfooding your own API product through these consumer and creator apps as well.

So, there's this feedback loop where your own developers internally are some of the largest users of your API. And so, as they run into issues, that creates opportunities for you to improve the horizontal platform part of the product. Um but, then also as you push the envelope on what your creator and consumer apps can do, it it informs new opportunities for how the APIs themselves can be pushed forward and advanced. Um what are some of the

specific ways that Eleven Reader is using the advantage of being within Eleven Labs to compete against incumbents like Audible and Speechify. And I know in some cases you compete directly with those companies, and in some cases you don't. But, how how are you finding ways to gain an edge based on your affiliation with Eleven Labs? Yeah, I mean, I think we're we're still in the the very early stages when it comes to this work. But, the good news is is that the audio market is beginning to boom right now when it comes to consumers. Um I think we've really leaned into the fact of course so that we build these models in-house and then we we have kind of fine-tuned control over the way that they perform and I think that that that allows us to offer them at lower cost or be able to reach across a lot more languages geographies than we might on our own. So I think that that's one opportunity around kind

of the the size and the scope of the market that that we're able to to meet and address. Um and then yeah, I think we're we're talking about this kind of compounding effect where you you start to be able to get, you know, if your goal is to be able to voice the most lifelike and responsive kind of AI doctor's office receptionist that needs to be able to relate to a patient on the phone or if you're creating a voice tutor that's used by Duolingo or by Masterclass that that same kind of breakthroughs that you get in that specific moment can also come back to be able to help you inform kind of the voice and tone that that can be applied to read a bedtime story. And so I think the realness and kind of the naturalness of that voice experience can really be be extended across a variety a variety of uses. Yeah, it makes a ton of sense and I was talking to um Ann Bordetsky at NEA who I think you

know because NEA is obviously an investor in Eleven Labs and she was telling me how

audiobooks are probably going to evolve almost into a new medium over the next few years because you're going from a world where you have one or a small set of professional voice actors who are reading these titles to a world where you could have multiple voices, multiple tones. Uh you almost create this immersive space that the story is taking place in and so it sort of sits in between traditional audiobooks and then like full-scale theater movies, right?

And so how do you think that will impact how people consume content over the next few years? Yeah, I think it's really interesting and I I just got back from a conference a couple weeks ago where we were doing work with one of the big five publishers that are really trying to think about this and are trying to explore how is AI going to evolve the way that they tell stories or be able to distribute them. Um I think there's, you know, there's a couple of opportunities there that you named. So one is kind of the the amount of choice that it lends to the the type of experience that that you want to hear. And in the way I think of it is you you can almost think of like a dial of how much do you want to dial up the multicast or soundscapes or sound effects that are really piped in to become much more of a a cinematic experience or to what extent do you want to read a research paper aloud as you prepare for

a graduate school exams and and and that might not be the type of experience that you want. Um and I think that there's always still going to be space for on the very highest end, right? The the finest voice acting that that can bring stories to life in a really human way, but I think the the the big opportunity, of course, when when it comes to audiobooks is just the pure scale. If you think of a percentage of ebooks that get converted or or recorded into audiobooks is sub 5% and it's extremely low as you kind of look at the long tail of markets and geographies around the globe. So I think there's going to be two effects going on. One is just going to be able to to extend that use across a very long tail of of texts and books that aren't in audio today. Mhm. And then of course kind of the this choice piece of being able to redefine the way that that work um sounds and is heard. And of course to

be able to get there there there's still a lot when it comes to um rights and copyright and a variety of needs to be able to navigate, but I think at the the end of the day the the use case is going to ultimately flow towards a consumer in the way that they want to be able to experience that that story and that content. Yeah, I mean what's what's so powerful about 11 Labs is just how flexible the platform is and the use cases are endless.

So now that we sort of painted the picture of where 11 Labs is going and and where apps like 11 Reader built on top of 11 Labs can go, let's let's get a little

bit more tactical. So let's go back to is May 2024 when you all initially launched 11 Reader. What did your launch strategy look like when you were just getting it off the ground? Yeah, so I think one thing that we've done at 11 Labs is we've really tried to build and embrace this kind of launch focus culture and and so we we really build around the these launch moments and create a bunch of media and a a bunch of hyper around that specific point in time. And so the beginning was pretty straightforward. I mean we we leaned really really heavily into viral and organic growth. It's just right before I joined and when I joined the the core of our work on the app was to continue to drive word of mouth through Reddit, Discord, and as time went on we we kind of have grown from a a team of four developers and and one designer to now kind of a much more fully formed team to be able to drive not only across organic, but also supply

led growth or partner growth as well as beginning to layer in a bit of paid as well. But from the beginning it was really yeah, you know, a bet on let's ship a product and and see what the response will will be and really go from that point forward. Which is pretty typical for consumer apps. So what I heard you say is you started with some of these grassroots platforms like Reddit and Discord and just allowed the initial product to speak for itself, get some early traction, find some pockets of early adopters, and then as that started to take hold, you were able to invest in a slightly larger team. You were also enabled to invest in some paid acquisition

channels. So, which which paid channels have been most important for accelerating 11 Labs' trajectory? Yeah, and I think one other thing that I would just add to that is that we we also had a unique opportunity where where we launched we launched the uh the 11 Labs app before we we had launched an 11 Labs app. And so, the there there was a time period where there were a lot of people that that were um searching and interested in and 11 Labs text to speech and and were finding this, you know, audio story app and and were quite confused in the beginning stages. And and honestly, part part of what we we did in and being able to build out an 11 Labs app what was to really get pulled into that demand to be able to meet what do do a text to speech consumer want compared to a text to speech creator.

And so, I think that that might also been a really important important time for us to um when it comes to when it comes to paid, we really view it as a way to be able to layer on top of or to be able to amplify the the work that we're already doing when it comes to brand and organic growth. So, I think yes, it's got a bunch of unique attributes that that allow you to go out and bid to be able to reach audiences that you might not be otherwise able to tap into. And I think that that's been been true for us when when we're building inside of an AI lab and then also trying to go out to be able to attract a consumer that might be interested in romance or fiction or fanfic audiobooks.

And so, I think that that's kind of been a unique case. Um We also, of course, that there's for for those that haven't spent as much time, that there's, you know, massive massive communities of BookTok and Bookstagram, and there there's a lot of latent demand and conversations that are going on across the these platforms. And so, we've really tried to use both on paid as well as influencer um trying to lead with more of a UGC approach than what you might otherwise see from an AI lab to be able to connect with with this type of consumer um and that's been really key in the beginning stages. Yeah, I was talking to Paul Warren who's the founder of Margins earlier this year and he was he was telling me about how important TikTok was for their launch strategy and and for continued growth their app. It sounds like you've been able to tap into a lot of that same passion that exists among avid readers both offline but now

increasingly through these audiobooks.

You've also talked a little bit with me about partnerships that you've done with celebrities like Melania Trump for example. How has that fit into your user acquisition and expansion strategy? Yeah, so that was of course one of our more uh what I would say is a quite a unique and a bit of a controversial uh launch for for obvious reasons but I think you know, what we saw in in that opportunity which was her team was very committed to making her ebook content widely available in a bunch of languages and in audio. And so it's fairly unique in that now you can play her ebook aloud in her uh voice that's now being uh read aloud in Portuguese and Spanish and English and Hindi um and so content or personal feelings aside about anything, it was really just a unique probably a first of its kind partnership in the audiobook space to be able to bring a story to life in that way and and I think more widely our

approach beyond that specific partnership we now have um a variety of icons on the platform like Michael Caine or Maya Angelou or the voice of Judy Garland who are all on the platform now and and I think that it's from a core belief of ours that uh reading and that voice is really a a personal and an intimate experience that the way that you relate to to a voice that you've heard from say a young age is really important and that we view these kind of partnerships with iconic voices as being part of that and we've really brought these voices through exclusive partnerships where where where fairly compensating and in partnership with either their their estate or their team to be able to bring that that voice and that tone to really create a unique a consumer experience and and one that seems to be really impactful and in core to what what we're doing when it comes to reading aloud. So we really want to bridge the two which

is telling the great stories but also pairing them with these iconic voices that you can only now get as a result of our technology in hearing a story told in in a voice that you might not have imagined before has been a pretty unique part part of our growth at Eleven Labs. Yeah, it's very compelling and I'm curious with your partnership strategy, how much of it is opportunistic where you just happen to have an icon who wants to work with Eleven Labs reach out or you reach out to them versus more strategic where there are particular pockets of users or audiences that you want to attract to the platform and so you're you're then reaching out to a set of icons who you know can tap into that user group. Yeah, I think it's a really it's really interesting question. I mean there's certainly a lot of interest in being able to produce high fidelity and professional voice clones that we might support but we might not always bring on

to our platform as kind of an iconic voice or to be able to blend. We we've launched an iconic voice marketplace to connect brands and advertisers to be able to use these voice tones in a really secure and partnered way. We've also taken the opportunity to look at where we we see um the greatest needs and opportunity, right? So so one good example is we have a very large base of consumers in Poland because our two co-founders and a large share of our team are are from Poland.

Um we we have really deep roots there. And so we we had an exclusive partnership with the voice of kind of Polish film uh Piotr Fronczewski who who has voiced, you know, the Harry Potter audiobooks in Poland. And and he's now a voice tone that that you can can read aloud with inside of Poland and inside of the Polish language. And that that one voice, of course, on on Eleven Labs has kind of shot to the the the top of the charts when it comes to that set of consumers. So we just think that this idea that that voice is such a core and intimate part of the the experience that you get when when you're hearing a story. And and this kind of really unique opportunity to be able to pair voices with with stories has been um both opportunistic as well as kind of cultivated in in what we're trying to do. Yeah, I couldn't agree more. And I'm so glad you brought up Harry Potter cuz I have two daughters who are eight and

six and I've been reading the books to them multiple times. And uh you know, it's funny. It's like when you're a kid and you read Harry Potter, you have this version of it in your mind. And then you go watch the movies and it doesn't always jive with what you had in your head. Uh I think a lot of people have felt like maybe the Harry Potter movies didn't do the books justice. But audio's nice because especially with a tool like Eleven Labs, you can tailor the voices to reflect the reality that you want to create. But then it also leaves enough up to the imagination that it that exists in this sort of nice middle ground in between.

Um let's talk a little bit more about monetization because AI is changing the the consumer apps monetize their subscriptions or the products more broadly in pretty profound ways. Um for a variety of reasons, but one of the most important ones being the marginal cost of serving a subscriber used to be zero or close to zero. Uh whereas now with underlying compute costs from LLM's, it's it's become non-trivial. And so how have you and your team thought about 11 readers um monetization strategy in in in a context where serving a marginal subscriber, especially one that's using the product very heavily, um can be pretty significant. Yeah, I think it's a really interesting one and and one that we, you know, deal with and had have had to deal with from the beginning because, you know, 100% of our products and our platform or servers are are built on top of compute and are built on top of tokens and as those

costs continue to come down, it does allow greater kind of uh flexibility to be able to meet that that demand, but I think that um compared to prior costs like like a check, of course, or or at Quizlet if you wanted to create, you know, hundreds and thousands of of flash card sets and that's going to have a real material upfront cost. Um So yeah, I I think, you you know, one thing I would call out specifically for for our case is the way that we've monetized between two apps that that we run, right? So if you're on the 11 Labs app, of course, you're you're already in the mindset of creating AI media, you kind of get the idea now that there's a certain amount of credits or tokens that you'll be able to get to be able to create that. If you're Vibe coding or if you're creating text-to-speech, right?

You you you kind of understand that that's a currency that's being used now. And then I think if I compare that to 11 reader and if you're say a a stay-at-home mom or dad and and you want to play fan fiction at at night to be able to fall asleep and and you you might not be thinking about, you you know, how how how credits or how many tokens this is going to cost me to be able to to play aloud, right? Um you just want to be able to experience that that story in rich and flawless audio. So, one of the things I think I heard you say there is you have the 11 Labs Creator app and the 11 Reader consumer app.

For a Creator app, prosumers in general are a little bit more used to more complicated monetization models. Could be a subscription, could be a usage-based or a value-based model. Could be a hybrid model where you pay a base subscription price, but then you pay for additional credits on top of that. Whereas in pure consumer land, consumers tend to be a little bit more resistant to complexity. And they've been trained by some of the largest and most popular consumer apps like Netflix or Spotify or Duolingo that where they're just going to pay us a simple monthly or annual subscription and that's it. And so, what I hear you saying is both of these apps are using the underlying 11 Labs API, which has costs associated with it, but you've taken two different approaches in how you're monetizing the Creator app versus the Consumer app to reflect what the end user expects and and is aware of. And

so, can you go into a little bit more detail around what what does the monetization model look like for the Creator app versus the Consumer app? Yeah, so I think on the Creator app side, the way that we think about it at 11 Labs is we now have I think five tiers that allow you to subscribe the amount of access that you want to be able to produce with, right? And so, that can range from um as low as $5 a month and then scales uh say upward from there. We've tried to really find a an um a nice middle ground with that when it comes to the Creator app as well, because you you are inside of um inside of the App Store and the Play Store a little bit more tied to the specific mechanics of IAPs and subscriptions and upgrades that that kind of need to to to flow in a specific way and and don't always give you the the same amount of flexibility that you get um when you charge on the web. So, we we've tried to take a very clean

approach there and and have built really around one core subscription and then a pay-as-you-go model that we're beginning to roll out as well. So, um uh again, I think as soon as you're you're in either consumer or creator spaces, just being super clear about the specific way that you're monetizing is important. And then on the flip side, what we we see out of the the 11 Reader app, of course, is really just two plans and it's very straightforward here.

We've been able to build a a very robust free plan that allows you still the same great AI voices. So, we don't downgrade your voice experience. I think that's important to us because we we do want to make sure that that the greatest voice experience you can have um is going to be available on a free plan. Um and that's kind of a unique take compared to a lot of others in the space. And then we we've had to evolve our way into paid plans where where today we offer one kind of full full unlimited plan that that allows you to be able to consume um up to 24 hours a day. And you know, that that I think has changed the way that we think about monetization a great deal. Uh I think at the end of the day, you you have to start with what what a consumer is going to want to subscribe to and work backwards instead of trying to ship your own view of of the way that they should subscribe. Okay, so you've

talked through how the pricing for prosumers versus consumers looks different and the the reason for keeping the 11 Reader consumer app monetization model much simpler than the creator model. Let's also talk a little bit about the evolution you took to get there, right? Like you've experimented with multiple approaches uh for the 11 Reader app that got you to this much more simplistic outcome. And then also, let's talk a little bit about web versus mobile and why you've chosen to keep pricing models on mobile a little bit more streamlined. Yes, so in the beginning we took what was really a uh, three-step approach to being able to price on on our consumer app, right? So, we thought a little bit about, you know, having a robust free tier that will continue to drive drive growth and really fulfill a a core need there for for those who who want it.

Uh, we thought about uh, mid-tier price, call it what can you get between five and $10 a month. Um, and then of course that there's a larger group that that wants to play, you know, entire books uh, one day at a time or 10 or 12 hours a day to be able to consume audio. And so, across this wide wide span of of consumers, where's the right space to be able to create plans that both leave a good bit of value on the table for consumers to enjoy and allow us to be able to monetize. What we learned over time though, both uh, quantitatively through testing and going live to market, as well as qualitatively and going deep in in in kind of interviews and and really understanding the way that these plans are conceived of and and and viewed, um, was just that consumers tend to view pricing much more in a binary way of either, you know, free or paid or little or or expensive, right? And it's not necessarily rooted in in what they they

say they might want or need, but it's much more comparative to what they they might might expect from from other paid applications, right? So, Spotify or or Netflix, if you're kind of in the realm of media, Um, those might be the the pure apps that you're that you're compared to, right? So, over time, what we've done is is have just made a lot of moves to to also readjust and repackage, but have primarily collapsed the paid plans into one. So, today we we offer even more expansive free plan that hundreds of thousands of people love and and and use, but also one kind of ultra plan that gives you unlimited time of text-to-speech, and one of the advantages that I think that we've had over time is that time yields more uh data, and so you can just look at the way that these consumption patterns age and grow over time and get smarter about where you you kind of price and package.

And and ultimately, we we found that binary distinction between paying for full access and and complete access what was a much much stronger value proposition than trying to pay at certain tiers when when you think of the specific product. That makes a lot of

sense. And then, how have you thought about monetization on web versus mobile? It sounds like on mobile, you've kept things simpler than on web. What was the rationale for that? How much of it was based on consumer psychology versus just operating within the constraints of what the app stores allow you to do? This has to do on the the 11 Labs app where the the 11 Labs web plans are really expansive. So, I think we we now offer somewhere upwards of six plans that start at $5 that might go all the way up to a couple thousand dollars that are really built around a a pro server use case and and then a small to mid-size business use case. A lot of it is the majority of it is based on some of the constraints that you get inside of these platforms and IAPs, and the the the way that they can or do stack together or not, or the way that they do or do not sync to what you you provide on the web, right? So, downgrades, discounts, and

expirations, and keeping all your plans in sync across, you know, Google, Apple, and or Stripe, um, is a really challenging thing to do. And and I I think that that's part of it, but I also think part of it, too, is that, um, when you're on a mobile device, we we are, I think, as consumers, and and if you're you're in a creator mindset or not, you're you're still viewing pricing and packaging through the lens of of a very small interface. And so, I think that that a lot of times makes a lot more more sense to be, um, more opinionated and and more clear about what you offer.

And in the this case, for us, it means, um, having a smaller footprint when it comes to the plans that that we do offer. Yeah, it makes a ton of sense. It's both the smaller form factor, but it's also people are typically on the go when they're on their mobile devices, and that may mean they have less time to make a decision. They may be multitasking, and so, I've found over and over again that simplicity is just so important when you're a consumer app operating on a mobile device.

Um, well, this has been a great conversation, as I knew it would be. Let's jump into our lightning round. I'm just going to ask you a series of rapid-fire questions. You can give me quick 1-minute responses. Um, what's the best part about working at Eleven Labs? And what's one thing that you would change? I think the way I would put the best part about Eleven Labs is that the space between idea and execution is really small. And it's that if you have a great idea and and a great insight or a test you want to run, uh, you you're expected to have that shipped the same day. I think on the, uh, Subclub podcast, I called us like a series of speedboats, and that's really the way that we operate, are these small teams that move extremely fast, that are tight-knit, that have really high talent density. And the combination of those things uh, really just allows our teams to perform and and to move really quickly

and and as someone who got into this work to be able to to build and grow and create new things, I think that's an incredibly fulfilling part of what we do. I think there's not much that I would change. I mean that um honestly, but I do think that in going from I think as I shared single product into multi-product, there's definitely times where at that speed there there can be a lack of coherence at times between the these small teams and kind of the overall connection between them that can be hard to coordinate or can be hard to to kind of make work, but I think uh when I take a step back, it's just truly a remarkable place to be able to work and to be able to build that.

Yeah, well, it's certainly what I've heard is that 11 Labs is a fantastic culture and and really a builder's culture. It's attracted a lot of entrepreneurs and and people who want to move fast and break things and then build things. Uh and and obviously anytime you're in an environment like that, um it does create a little bit of chaos, but it sounds like one of the things you've done from very early on in the company's history is create these sort of small SWAT teams that can operate more or less autonomously, um which just allows you to to move fast without creating a lot of coordination cost. To go to a more light-hearted place, what is the funniest combination of voice and content you've ever seen on 11 Labs? So, this one is a little a little bit a little bit different than a pure uh voice content combination, but I'll share this with you cuz I I think it's uh I think it's fun. So, one is a lot like language models, voice

models can also hallucinate and they can degrade as far as um audio quality or morph the the sounds, or volume, or they might even inject, um, certain inferred sounds what during a uh, you know, a non-character space of space, or a uh, a period, um, and it might not even be seen by by a uh, uh, by a by a user, but can spur some pretty wild sounds. Um, so we, of course, have an iconic voice in the platform of Burt Reynolds, this grizzled, iconic, American, you know, male voice.

And there was a period at the beginning of last year where Burt's voice, specifically, would degrade, um, and hallucinate after very, uh, long amounts of, uh, session time. And so, we had some wild and hilarious, uh, examples of, uh, the voice of Burt kind of morphing into this almost demonic-sounding demon voice that would only come into play after you've already been playing, you know, half an hour or more of a uh, piece of content. And so, um, that was we saw some clips go viral on that in our communities, and we've worked really hard to keep the demons, uh, at bay since then.

I mean, it's a an example of all publicity is good publicity, right? You wouldn't necessarily think a demonic Burt Reynolds voice would be a good thing, but it sounds like it got it got a lot of attention on social media, and it shows off the power of what a platform like this can do, even even in the context of a hallucination. Um, what sort of content do you like to listen to on Eleven Reader, and when do you listen to it? Right now, I'm, uh, halfway into The Sun Also Rises by Hemingway, which is being read to me uniquely by Michael Caine, which is a pretty great experience, and just wild to hear those two words. Um, I also really love like a lot of people. We've got a very big use case around uh playing longer form blog posts or or longer form articles. So, um we've done some work with Packy McCormick who writes great in-depth long-form articles or of course um Paul Graham kind of stories and essays or are

great to be able to spend more more time on cuz they're so long. Um and yeah, we have a very very active golden retriever, so I end up doing a lot of long walks and and hikes and um and I tend to play um a lot of my my content in that free time. Yeah, it is one of the wonderful things about audiobooks that you can do it outside, you can do it in the car, you can do it on the go. And especially as a busy professional with two kids, I find myself doing a lot more listening than reading these days.

Um what's one growth tactic we haven't already talked about that's worked surprisingly well for Eleven Labs? I'd say one that's not flashy is just continuing to optimize our trial experiences. And so, um really creating a cohesive experience from onboarding through through trial offer. Um and you know, a lot of that has been against conventional wisdom. Um you know, there's a lot out there on the right way to be able to monetize or the benchmarks or you know, doing a one-week reverse trial to really get engagement before an offer and um and I've been surprised by as many things that I've had to unlearn or had have surprised me in in in our trial experiences as those that that have been confirmed. And so, um I think that that's one that we're constantly playing with, constantly trying to do improve, constantly trying to to build upon and iterate that's um delivered a lot of compounding wins for

us. Yeah, I mean onboarding is just so important and you got to think about it from first principles and you can't just copy-paste what's working for other apps. And so it sounds like in the case of 11 Labs and 11 Reader, just shrinking that onboarding experience and getting the user directly into the product experience is sort of spoken for itself and it's worked really well for you guys. Last question is just what's another consumer app that you think is doing an exceptional job of leveraging AI to create new and compelling experiences for consumers? Yeah, so I think one that we really admire and this I think is a bit of a consensus pick currently is um WhisperFlow and not just because we love AI audio, but also um when we just hit on kind of onboarding and trial experience, I think that they've taken a very technical and complex onboarding experience, like having to interact with system settings and custom

keyboards and audio channels is not a very intuitive thing. So I think that that's one that that I really admire. There's um a couple of others, one one called Quarter that's in the fi that's in the finance world and kind of bridges the gap between institutional kind of knowledge and insights and transcripts uh earnings calls that I think is really interesting and and doing some unique things. And then um yeah, I know that you love chess Phil and I'm trying to to improve and and learn and chess.com is um uses 11 Labs too to have you be able to to interact with a voice kind of chess tutor. And so those are some of the things that I'm kind of viewing as like reimagining the way that you think about consumer interaction um and all three of them have some element of voice in them, too. Yeah, well I'm so glad you brought up WhisperFlow in particular. I've done a little bit of work with Kenai and the

team there as well. And and the stuff that they've done on the onboarding experience is exceptional. I mean, they've just taken this very technical product and made it fun and uh whimsical and so inviting to new users, some of whom are engineers and highly technical professionals, but you know, many of whom may be using voice-to-text transcription service for the first time. And and so, it really just leaves such a positive first impression in people's minds and it's not a particularly easy product to do that with. But they've been so creative in how they've approached it.

Um well, thank you so much for coming on the podcast, Jack. This has been such a delight as I knew it would be. Anything you want to leave our audience with before we sign off here? No, thanks, Bill. It's been fun. I'd just say to give our apps a try. We'd love to hear, you know, with a we'd love to hear your feedback. And we're hiring and growing for for exceptional growth marketers, for iOS developers, for designers. And so, if if you're really into the these themes and want to be able to help build at the forefront of AI and audio, feel free to reach out. Awesome. Yeah, it's a great team and a great company. Thanks again, Jack. This has been a pleasure.

Thanks, Bill. Thanks again to RevenueCat for sponsoring this episode. If you're building a subscription app, you can use RevenueCat to power purchases, optimize paywalls, offer discounts, handle refunds, manage customer data, run AB tests, generate insights, and unlock more revenue. I work with dozens of subscription apps and most of them are already using RevenueCat to power their businesses. Learn more at revenuecat.com/subversion.