Shares of Klaviyo (KVYO) popped on its trading debut on the New York Stock Exchange. Klaviyo Co-Founder and CEO Andrew Bialecki tells Yahoo Finance the company is really "just getting started" but that its IPO is "a huge milestone." "We believe that every company should have smarter digital relationships with their customers," Bialecki says, adding "that's a super durable trend." Bialecki also stated that the company is "long-term oriented" and "disciplined" in how it plans to grow. When it comes to AI, Bialecki tells Seana Smith that it has been "core" to the company's strategy over the last several years and that the company can be viewed as an AI play.
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Video Transcript
SEANA SMITH: Klaviyo, the software marketing company that helps brands better target customers-- think through email, through text-- going public today on the New York Stock Exchange. And I want to bring in the CEO and co-founder of Klaviyo. We have Andrew Bialecki here joining us from the floor. Andrew, first off, congratulations. Huge day for your company.
ANDREW BIALECKI: Thanks. I'm just so proud of the 1,500 Klaviyos all over the world, our 130,000 customers, brands like TaylorMade, Unilever, Skims, 5,000 partners. We've been building for a decade. We are just getting started, but today is a huge milestone.
SEANA SMITH: Certainly a lot of questions going into this public debut when we talk about valuation questions, when we talk about the ability to get some of those bigger name investors on board. You've done that. What's your message to investors and maybe some of those out there that aren't as familiar with Klaviyo?
ANDREW BIALECKI: Sure. Well, at Klaviyo, we believe that every company should have smarter digital relationships with their customers. That's a super durable trend. We're a very long-term oriented company. And so that's one and two, is we just believe in being disciplined in how we grow. I think we believe in creativity, in the constraint that-- or constraints really force creativity. So that's what our company is all about, is aiming long and then just executing really well.
SEANA SMITH: It turned profitable in the first half of the year, net income of just around 15 million. Are you confident you're going to be able to stay profitable?
ANDREW BIALECKI: We'll see. Like, we'll look forward right now, but I mean, we've-- just that discipline in the way we think about building, getting close to customers, getting close to partners, I think that's how you build great businesses.
SEANA SMITH: You founded Klaviyo just over 10 years ago, back in 2012. I'm curious, before we talk about your customers from the targeting standpoint, when you take a look at the consumers out there, how have the consumers' needs evolved over the last 10 years?
ANDREW BIALECKI: Sure, well, consumers definitely, they want the businesses that they work with, I mean, that they buy from, they transact what they want. They want those businesses to know who they are. I think we've all gotten messages or had these experiences where it felt totally unpersonalized, just generic. That should be better.
And what we found is, the businesses want to deliver that because they know customers love personalization, and that's what gets them to buy more. It's just the tech was missing. So that's what we've been trying to build and what we've built. And I think a little bit of proof point, we've got everybody from entrepreneurs just starting out, small businesses, now moving up into the enterprise. I mean, there's-- we think there's a lot of customers out there that should be running on Klaviyo.
SEANA SMITH: And I believe you do it through predictive models of consumer behavior, right? So how much of that are you relying on AI for that part of the technology?
ANDREW BIALECKI: Definitely. So machine learning, artificial intelligence has been core to our strategy, I mean, really for the last five, six, seven years. I think if you look at a lot of, we'll just take marketing as a space, you have to be a really talented marketer and you're still experimenting to figure things out. Every customer I talk to says, Andrew, what ideas do you have that I may be not thinking about? Well, the good news is you can use artificial intelligence to not only generate content, but help come up with those ideas. I think in the future, we're going to build software that is good at using itself.
So in this case, the marketing software, literally, you plug your business into Klaviyo. It'll develop your marketing strategy. And whatever your growth goals are, it'll build that optimal path to help you get there.
SEANA SMITH: So should investors be thinking of Klaviyo almost as an AI play?
ANDREW BIALECKI: Yes. I mean, we think about it as we built the data infrastructure to store all your data, the applications, the marketing software, to connect with those customers. And then it's really artificial intelligence that brings it all together, so that even if you're not a great marketer or you want more advice, you can get that automatically with our software.
SEANA SMITH: And Andrew, your customer base right now, just over 130,000. When you take a look at that future growth, what do you think is going to drive that? And who are you targeting? Where are you targeting?
ANDREW BIALECKI: Sure. Well, so our number-- we look to, honestly, we try to delight our customers. And then we know that they talk. Like, actually, a lot of businesses, you can grow virally. So we're going to continue to lean on that. We have wonderful partners. And yeah, I mean, we're excited. We're getting-- larger and larger brands are coming and saying, hey, I want to standardize on Klaviyo. We've opened offices in London and Sydney in the past few years. We're excited to expand globally. There's a lot to do.
SEANA SMITH: Your international exposure right now, I believe as a percentage of your revenue, right around 30%, right around 1/3, what do you hope that that looks like 5 to 10 years from now?
ANDREW BIALECKI: Yeah, I don't know. International is a really exciting market. I spent a lot of time just traveling in Europe and in Asia, understanding how businesses there work, how often I'm surprised at like, they're just as driven as the companies that are maybe in our hometown of Boston. I don't know where that ends up. But I'll tell you, there's a lot of growth there.
SEANA SMITH: When you talk about some of your customers there, and I was going through your S-1 filing, nearly 80% of your company's average annualized revenue coming from customers of Shopify. Some are saying that maybe that could be a potential risk here. What's your response to that?
ANDREW BIALECKI: Oh, we're not worried about the risk. I have known the Shopify team for a long time. We love working with market leading platforms. And they're definitely a market leader. We're excited to work with more of a Shopify and platforms in other verticals outside of retail and around the world.
SEANA SMITH: Andrew, great to have you. Thanks so much for making the time.
