Kate Bradley Chernis of Lately.ai
Artificial Intelligence Founders to Watch
I did this interview nearly two years ago. I’m reposting it here as my AI newsletter is gaining traction and I’d like to do more interviews like this. If you’re a founder, or know a founder using AI, please reach out.
There probably isn’t a “traditional” founder. If there is, Kate Bradley Chernis isn’t it. A former line cook turned DJ, her story is pure chutzpah. In addition to the usual shenanigans in those lines of work, Kate has added the challenge of being a woman in the boys club known as startup land. A place where women founders only receive 2% of funding.
She probably wouldn’t have it any other way. She’s attracted to the lawlessness and doesn’t back down. Prior to founding LatelyAI, Kate was a DJ with XM Satellite Radio in Washington, DC. Her show, The Loft, had over 20 million listeners a day.
But something smelled, and it wasn’t just the Blue Plains Water Treatment Plant nestled along the Potomac. Kate faced hurdles each and every day. From sexual harassment, to others, mostly men, taking credit for her ideas. Her health suffered. She was on and off of crutches for nearly two years and developed epicondylitis and tendonitis throughout both arms and hands. Kate’s condition kept her from typing, or even touching a phone.
She tried everything. Eastern Medicine, Western Medicine; nothing seemed to work. XM Corporate was less than empathetic. After all, Kate didn’t look sick. She was forced to hire an assistant using her own money just to get the job done. To this day, Kate can’t type without pain. She uses ‘voice activated software’ and styluses to navigate through life.
Faced with challenges that would make most of us curl up into a fetal position and cry our eyes out, Kate didn’t give up. She discovered Dragon Naturally Speaking. Impressed with the possibilities, she sought out a coach. There were only four in the entire country. Fortunately, one was based in DC. The coach gave Kate a tour of the Pentagon to work done by the Department of Defense to assist paraplegics. Kate paid her with a ton of music CDs.
Kate knew she needed a change. Three things all came together for her in the same week. A series of fortunate events. Visiting her father, an entrepreneur, he lovingly grabbed her by the shoulders and told her she needed to work for herself. There’s no shame in that, he said. The second thing she did that week was read a self-help book. And finally, Kate had lunch with two XM fans who turned out to be angel investors.
Most clients mailed stuff in. These two, being fans, insisted on hand delivering. They wanted to meet Kate in person, and take her to lunch. The conversation turned to business. Kate shared some ideas. Impressed, the two angel investors said let’s start a company. They put up the initial $50k. This led to a company that marketed music using “widgets” — a sort of mini online radio station. The algorithm perfectly matched new songs with old songs. Kate hired someone to write the code. She pressed three other DJs into service.
Kate explained the neuroscience behind what happens when we listen to music. Our brain indexes the frequency of every song we’ve ever heard into our memory. When you listen, your brain goes through every previous song you’ve ever listened to and figures out where to put the new one. She calls it a “Nostalgia tag.” As a marketing expert, Kate understands in order to sell, you need to couch new information with the old to create trust.
Around this time, her boyfriend, now husband, gave her Guy Kawasaki’s book, The Art of the Start. Kate says she didn’t finish it though. The gist was, don’t make a plan, just get started. Not starting is the number one mistake we all make. “There’s really no map for what any of us entrepreneurs do, right?” Kate told me. So that’s exactly what she did. She got started and never stopped. Her aunt recognized her marketing skills and asked her to come consult on a major Walmart project for “a lot more money.”
Walmart, the United Way, Bank of America, the National Disability Institute, and the IRS had a project aimed at lifting the poor out of poverty. Kate was brought in to provide a unified marketing effort.
In her own unpolished way, Kate let it be known current marketing methods for the project were a disaster. For her own sanity, she built a master spreadsheet designed to chase down every piece of the marketing process of five large organizations, encompassing some 20,000 people.
She quickly identified the biggest problems: Content creation, messaging inconsistencies, and bad writing. Kate says the people at the largest organizations in the world were just as bad at writing as the people from the nonprofit library down the street.
Her system took pieces of content from press releases, to blog posts, and morphed them into teaser leads that were posted to Social Media with a short link at the end. Engagement skyrocketed. Her efforts resulted in a 130% ROI on marketing spend. Kate went on to give over 200 workshops over three years. She became an expert on how small, medium, large businesses, and nonprofits did marketing; and what their pain points were. She created a way to unroll content and localize it so it resonated with individual audiences.
Kate took all she learned, along with her spreadsheet, and started a Marketing Agency. Over the next couple of years, she’d had sporadic conversations with another angel investor. During one conversation, the investor told Kate she should automate her spreadsheets and make software out of them. Oh, and it would cost $25k. First off, Kate says, no one touches my spreadsheets! And, maybe you haven’t heard?, I’ve been working in radio — $25k is a lot of money! She’d been saving to buy her first house with her husband. The investor ponied up the money and said they should start a company. Kate agreed with one stipulation, “I’m in charge!”
And so begins a journey which became LatelyAI. Kate and her team went about improving the product and raising money. It was all Demo Days, Accelerators, VCs, and drama; including having to perform on Demo Day four days after an automobile accident. There were long days and late nights. The burn rate required Kate to rally the troops to complete the mission without pay. But this isn’t the half of it. There’s more, a lot more. Names and details are omitted to protect the guilty.
Moving into March of last year, right at the start of a global pandemic, Kate turned the corner. Sales grew from $25k MRR to $89k MRR. Exhausted, and with her plans to vacation in Florida and Italy thwarted, Kate planned a staycation. Disconnect, recharge. She had one standing order to the team; complete a video feature she’d hounded interns to finish for over a year.
And finish it they did. A mutual friend showed the feature to Gary Vaynerchuk. “Holy shit. Who is this? I want to meet them on Monday,” was his response. Kate says it wasn’t so much validation from Gary that moved the needle, but the team finally had something they could show, instead of tell. This allowed her to raise the price from $99 to $350 per user.
On January 24, 2021, Kate hit a major milestone. One a founder never forgets. LatelyAI hit $1 million ARR. Sure, many challenges remain. But with Kate at the helm, navigating them won’t be a problem. She’s picked up new evangelists, like Gary Vee and David Meerman Scott, along the way. Her inspiring story begs the question, “What have you done, lately?”