BK: What are some of SmartSound's products?
KK: SmartSound software has over 75 SKUs (Stock Keeping Units). Six of those are our patented soundtrack creation software products and the rest are various music and sound effects content CDs designed to work with them. Our flagship product is SmartSound Sonicfire Pro ver. 3.1 which represents the pinnacle of soundtrack creation for media creators worldwide. It is a powerful tool that allows the user to customize music to fit visuals very precisely and affords the greatest amount of control for the user, all while retaining remarkable ease of use. Our other software products are Movie Maestro, a consumer-level soundtrack creation tool, and our just-released Quicktracks for Premiere Pro.
BK: Tell me a bit about your company--how many employees do you have, and who are your customers?
KK: We have 15 employees and will be adding more as this coming year progresses. We moved to new facilities in August that now affords us the space to hire more people to meet the rising demand for our products.
Our customers run the gamut of media creators - from home video enthusiasts, educators teaching kids such things as multimedia and video creation, corporate users making product, training and sales video and media, all the way up to major broadcasters and cable companies. We have hundreds of companies from the Fortune 500 - 1000 that use our products as well as hundreds of schools and universities. 12.5% of all our sales are to international customers.
BK: What's the history of the company, and how did you decide to start the company?
KK: Briefly, the company was founded between 1994 and 1995. The genesis of the idea for the software was as a direct result of my previous career spent as a film and television composer and music producer working in Hollywood, combined with subsequent experience managing a CAD software company. The CAD software gave me the idea that we could make a software that helps people create and design soundtracks, just like CAD software helps people create and design buildings, products and packaging. Not being a programmer by any stretch I teamed up with my two partners to bring this vision to life.
BK: I see that you received some venture capital to start your company. Where is the company now in terms of funding and profitability?
KK: We received a seed venture capital fund in May of 1995. We have not received a VC fund since. We have been net profitable since 1999 and are self funding off retained earnings from revenues. I would have to check the exact count, but I believe we have 19 consecutive quarters of net profitability.
BK: What are your primary channels to market - retail, direct, VARs?
KK: Our primary channels to market are VARs, resellers and distributors. We also sell into retail but it is a smaller portion of our business.
BK: Has it been difficult has it been for a small company like yours to survive in a competitive marketplace?
KK: In the first 3 years or so it was very difficult and we almost went out of business on four separate occasions. It wasn't until our fourth year that revenues stabilized in any kind of predictable way. I think the key to surviving in a competitive marketplace is to stay focused on what you uniquely bring to the marketplace and not worry too much about being like your competitors. Define your own world and let your competitors decide whether THEY want to fit into what you do.
BK: Finally, what's next for SmartSound?
KK: I can't tell you that in specifics, but stay tuned, in the next year or two things are going to get very exciting in our world.