The Neon Show

ChatGPT Killed My $50M ARR Business Overnight | Swapnil Jain Observe Al

• Siddhartha Ahluwalia • Season 1 • Episode 387

Share episode

Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.

0:00 | 1:07:32

Observe AI raised $125M from SoftBank at an $850M valuation, went on to cross $50M ARR, and worked with some of the world's largest enterprises. But after 10 months everything changed.

From a growth stage startup, Observe became an early stage startup, not because they did anything wrong, but because world changed forever very fast.

In this episode, Swapnil, Founder & CEO of Observe AI candidly shares what it takes to rebuild a company after you have already built it, why changing people and culture are harder than changing the product, why today's AI winners could disappear as the technology stack changes, and why he thinks we are still in the first innings of AI.

This conversation is as much about AI as it is about a founder's drive to win.

Chapter Markers

00:00 ChatGPT Made Our $850M Startup Irrelevant
00:38 From SaaS to AI Agents
04:30 Growing Fast, But Also Dying
07:36 Why VCs Bet $200M+ on Observe
09:26 FOMO Made Me a Founder
13:30 We Had Users, But No Buyers
15:27 Why BPOs Were the Wrong Market
17:26 “I’ll Never Sell in India”
22:30 YC Made Me Think Bigger
27:22 From $1M to $50M ARR
30:13 Building AI Before ChatGPT
31:11 The Birth of Observe 2.0
32:18 When ChatGPT Changed Everything
33:15 When AI Agents Take Over
34:58 Rebuilding a $50M ARR Product
35:47 When Co-Founders Leave
38:50 Will AI Actually Kill Support Jobs?
43:51 “AI ARR Is Not Real”
45:45 Most Pre-AI Companies Are Bloated
47:34 Learning GTM by Doing It
51:24 Changing Product Is The Easy Part
58:29 Why Voice AI Is Just the Beginning
01:01:25 The Founder Playbook
01:04:10 What Makes a Great Product?
01:05:37 “I’m Here to Win”

-------------
India’s talent has built the world’s tech—now it’s time to lead it.
This mission goes beyond startups. It’s about shifting the center of gravity in global tech to include the brilliance rising from India.
What is Neon Fund?
We invest in seed and early-stage founders from India and the diaspora building world-class Enterprise AI companies. We bring capital, conviction, and a community that’s done it before.
Subscribe for real founder stories, investor perspectives, economist breakdowns, and a behind-the-scenes look at how we’re doing it all at Neon.
-------------
Check us out on:
Website: https://neon.fund/
Instagram:   / theneonshoww  
LinkedIn:   / beneon  
Twitter: https://x.com/TheNeonShoww

Connect with Siddhartha on:
LinkedIn:   / siddharthaahluwalia  
Twitter: https://x.com/siddharthaa7
-------------
This video is for informational purposes only. The views expressed are those of the individuals quoted and do not constitute professional advice.

Send us Fan Mail

SPEAKER_01

You're a fairly popular company till 2022. One of the top 2050 fast companies from there that made it in the world. And then nothing happened.

SPEAKER_00

That's true. Because the fact that activity came out, it started to think that's very hard. That customer services and industry might look very, very different in the next few years. And with LM, do we really use the needs so many humans to do customer service or it will be LLM of our system? And if that is true, then I will serve with a mining market. And then now we're the observed 2.0 journey. We launched all of our agents last year and we've been killing it since then. So we are not a voice scale company. As you said there's 100 companies in India, 1,000 in the US, voice AI is a commodity. That's not the future. You have to build enterprise-grade deep platforms. So we were very, very, very clear from day one that we will never sell in India. One, it was not a big enough plan. USA is the biggest market for almost every industry. Go and start selling from here. Do not even think about starting from India. You will get stuck. You won't be able to make that jump.

SPEAKER_01

In future, where is customer service headed? I think it's a hi, this is Siddhart Alwalia, your host at Neon Show and managing partner at Neon Fund, a fund that has invested in some of the best enterprise AI companies coming from India, building for the US market, like Atomic Work, Spot Draft, CloudSec. Today I have with me Sopnil, founder of Observe. Sopnil, welcome to the Neon show.

SPEAKER_00

Thank you. Thanks for having me.

SPEAKER_01

Yeah, I've heard about a lot about you from our friends like Sharat, uh, right, Akash, uh, right. Glad to be doing this, you know, after a long period of time of planning.

SPEAKER_00

Yeah, same. I've heard a lot about you guys. Uh you obviously invested in some great company, so good to be good to be part of the show.

SPEAKER_01

Thanks, thanks. So Sopnil uh uh it's a 10-year-old company, uh right? Almost 10 years entrepreneurs give up. Uh and you were building initially something for a long period of time which was for the previous era, like helping human agents uh with uh QA uh on the customer experience, right? Uh right. Now now that QA has started to disappear because most of the calls that are happening are agentic, right? So agents are self-learning, almost perfect to the T, right? And all those calls, right? So what you build is almost irrelevant.

SPEAKER_00

Yeah, uh, you're right. Uh that is true, and and that's that's kind of like how we felt when Chat GPT came out in in 2022, right? So as you as you rightly said, we started in 2018, and the whole idea was let's use the power of AI. Back then we didn't really have LLMs of anything, use the power of AI to help the customer service agents do a better job. And the way we did that was we would analyze all the conversations that they were doing to understand how they're performing on those calls, find out opportunities to improve, generate coaching, uh, evaluate quality, measure compliance. So all that we did pre-LLM and pre-Chat GPT was to build a SaaS product to help the customer service agent do better. And shitted the fan in 2022 when ChatGPT came out. And it became as we started using Chat GPT, as we started using GPTs, as we started seeing more and more LLMs, it started hitting us very hard that customer service as an industry and customer service as a function might look very, very different in the next few years. And what I mean by that is so far the entire customer service industry was built around you have these brands who need to do customer service. People are calling them, emailing them about the order status, the refund status, about their tickets, about the bank transaction, and so on. And they would hire all these people, um, about 20 million agents, by the way, globally in US, sorry, in primarily I would say in India, Southeast, Philippines is a big hub, Latam is a big hub, and a little bit in the US to do customer service. And these people will obviously answer these calls and chats and emails. And with LLMs, it hit us hard do we really gonna need so many humans to do customer service? Or it will be LLM-powered systems that will be doing customer service. And if that is true, then are we serving a declining market? Are we serving a market that might not exist? So that was a pivotal point in our history where we realized we might be irrelevant. And to continue to be relevant, we almost have to dish to disrupt ourselves and not just think of how do we augment humans, but think of how customer service will work in the agentic first era, which means that a lot of customer service calls and chats and emails will be done by AI agents. And only the most complex things will be handled by human agents. So we built technology to automate a lot of the customer service calls, chats, emails, and then also build technology to have to help customer service agents with a lot more complex stuff. So that's how we have tried uh to stay relevant. This also meant like we had to disrupt ourselves. Uh, we had to take a hard call that, hey, whatever we have built is not so relevant. And that's what we call as Observe 1.0, the software as a service, the SaaS. And then now we are in the Observe 2.0 journey where we have built a platform relevant for the future of customer service with agents everywhere, agents that are talking to customers, agents that are helping the frontline teams, and agents that are autonomously running customer service operations.

SPEAKER_01

Yeah. And you were a fairly like I would say popular company till 2022, right? I think your last one was 125 million at 850 million from First Bank, right? Everybody thought that, you know, Observe because Observe was one of the I would say top 20, 30 SaaS companies from India that made it in the US. And and then uh nothing happened.

SPEAKER_00

Yeah, that's true, right? Because shit the fan. Yeah, right. We very quickly realized that whatever we had built so far is might not be relevant for the new world. And we had to take a hard call and a hard pivot, which meant that we have to change our trajectory from continue to sell. So we had a we had a short-term opportunity, by the way, right? So we could continue to sell software as a service, SaaS product meant to help humans. And we knew that it could continue to grow really well for the next few years, but we knew that it's not gonna last very long. If I if I think of maybe from 2022 to 2025, maybe our SaaS product and the product that was supposed to help customer service agents could continue to grow really well. But we knew that if I paint a 10-year view, we would be relevant. We would be dead. And when you are, when you paint a 10-year view, and when you think about going IP or a large exit, you're irrelevant company. So we took a decision which would impact our short-term growth, short-term opportunity to build for the long term. It's almost like we had to go back to being a seed stage startup or an early stage startup because we had to reinvent ourselves. So that's what the last, I would say, three years have been for us. And then we launched all of our agents last year, and we've been killing it since then. So we're seeing insane growth coming out of those agents across the customer service ecosystem. Uh, and that's sort of the new observed 2.0 that we are seeing where we are growing 5x year on year uh going forward.

SPEAKER_01

So very few companies are able to recover from uh from a previous era, right? Most of the companies keep on continuing because one reason is to justify to themselves, their investors, and the team that hey, we are still valuable. Right. What peak revenue did you reach in the previous uh previous let's say of the 1.1?

SPEAKER_00

So I mean I can't share the specific numbers, right? But it was not of uh $50 million, right? So we reached a pretty significant scale uh selling our previous generation technology, previous generation software. And you are right, right? We we also had a tough decision to make. Do we continue to work on protecting that revenue and growing that revenue when we know that in 10 years it's it might not really matter? Right. And we started this company, and even for our investors, right? We don't want to build a company that lasts for three years or five years. We are building a generational company. And in generational companies, you know, taking such decisions is a key part, right? You take, you know, you're not optimizing for short term. So even from our investor perspective, they were very comfortable with us taking a slowdown to build uh for the future.

SPEAKER_01

Understand. So so in the first journey, uh, can you share what made observe uh darling of investors? Because you raise a lot of ton of money, not just in primary, but a ton in secondary also, right?

SPEAKER_00

Yeah, I think it's it's primarily driven by um the fact that we were one of the few companies who were doing AI in customer service. So I would say pre-LLM, customer service was not seen as one of the hottest markets or one of the largest STAM areas. Everyone thought customer service is a cost center. No one buys technology there, you know, they don't have money to pay. And everyone was building software for sales and marketing teams, and obviously product managers and engineers and infrastructure where there was a lot of money. Customer service in a balance sheet is always seen as a cost center and they don't have the money to spend. We were one of the few companies who challenged that notion and said, no, customer service is an insanely big TAM, and if you build the right software, they're gonna pay for it. So when you combine the two facts, a very large tan, leveraging AI is where we saw a lot of momentum. And I think along that journey, we kind of brought in more companies as the awareness increased that yes. So, in many ways, I think of we created this market. We created this awareness that AI in customer service is legit, it's gonna happen. Um, and then everyone followed. Uh, and then Chat GPT happened, and then everyone realized actually customer service is gonna be the biggest market uh for AI. And they've been on the journey since then.

SPEAKER_01

No, I think in customer experience and customer service, Sierra, Decagon, everything happened after Chart GPT.

SPEAKER_00

This is all after Chat GPT, correct. Because now it became obvious. In 2018, it was not obvious, and that's to your point, that's why we were a very well-recognized company.

SPEAKER_01

Yeah, proposed LLMs. I think coding and customer service are the two largest marketplaces.

SPEAKER_00

Yeah, yeah, very much.

SPEAKER_01

And uh in your first journey, right, Observer 1.0, you there were some hard lessons that you learned, right? Your journey is you are 2012 graduate of IT, Delhi, right? And you grew up in Bhopal. Yep. Right. And three years you worked at Twitter here in Bay Area? Yep. Yes. What made you move back to India?

SPEAKER_00

So, you know, we'll find it funny. Um, so I came here in 2012, uh, right after college. I was at Twitter in San Francisco, and Twitter went public in 2013, and I I was also growing really well at Twitter. So there were two phenomena that was happening. One, I kind of felt fairly I kind of felt at ease that the corporate job looks pretty easy to me. Okay, I can keep doing this and keep growing, keep making some money. On the other side, what was happening was um all my friends from college were starting companies. So, you know, the the the common ones obviously that you would know of are Shadowfax, Misho, Bizongo. Um, all these are friends or senior or junior or batch mates from college. Yeah. And they were all raising a lot of money. And I was sitting in San Francisco reading about that on TechCrunch. So that gave me a lot of FOMO. I was 25, so I could take a lot of risk in life. Like, what the hell am I doing with my life? I want to go back. So I just left everything. I decided that I wanted to start a company. And there was nothing else, literally. I didn't have an idea, I didn't have a co-founder. All I wanted was, I also wanted a company because everyone else had a company. That's it. And you know, I spent two years and trying to find an idea and then started.

SPEAKER_01

So, what happened during those two years?

SPEAKER_00

It was actually very rough. I would say those two years fall into one of the roughest phases of my journey. I think I left my job, I moved back, and you know, I was looking for ideas. And looking for ideas is not a thing. It's not that there's a process to it, that you wake up in the morning, do this, do this, and you have an idea. Um, so I would wake up in the morning, I would really have nothing to do. So I would feel a lot of social pressure that I'm not doing anything in life. Uh, right. I would keep reading textbooks.

SPEAKER_01

IP and E, Twitter, and then Yeah, I was like, do nothing, right?

SPEAKER_00

Uh and and I I I did try a few ideas, right? At one point I wanted to start an insurance company uh for India. So as she became an insurance agent. So I'm currently a licensed ICICI Lombard insurance agent in India. Yeah. Because I wanted to learn more about insurance. Um, then I applied for a bunch of credit cards because I wanted to learn about the credit cards. So at one point I had 20 credit cards in India. I applied for every credit card possible in India just because I wanted to learn. So the whole during this process, what I was doing was trying to learn. And I think what that led me led to was I learned a lot about myself. So what I realized is I don't like operations. I don't like uh uh bureaucracy, I don't like uh uh sort of like the physical products or services. And a lot of ideas that I was exploring back then required that. So then I think 18 months into that two-year, I switched to saying, okay, let me go ahead and think about starting something that I would love, which is software, product, and technology. And in 2018, deep learning was happening, and deep learning made speech to text much, much easier, much much cheaper, much much faster. And that's when I decided, okay, I'm gonna go into it. I'm a software engineer, I love uh technology, I love uh this is a great area. So I was looking for use cases, one thing led to another. I was in Manila, Philippines, I learned about customer service. How long you lived in Manila? Uh, six months. Uh, all right. Uh between I would say like six trips. I would spend a lot of time in the Philippines, uh, just spending time in call centers and customer service. And and that's there's a lot of voice in there. There's a lot of inefficiencies in there, which we'll talk about. And then voice was happening. So technology, large market problems, and like this is great. So two years at the end of the two years, I realized, okay, customer service and AI is is what I'm gonna do. And then started, started going down that journey, you know, building the team, raising money, getting customers, and and here we are.

SPEAKER_01

How did uh uh you meet your co-founders in that journey?

SPEAKER_00

Yeah, so I mean, I I I have two co-founders um that I started the company with. Um Akash, uh, he he was uh he was my batchmate and roommate from college. Um so at when I was looking for ideas and trying to find, he was also doing the same thing. Um so we were like, hey, sounds natural. Um, you know, and he's is a phenomenal engineer. Uh and I'm not. So I'm like, great, you know, I'll get somebody who is phenomenal at technology. And then as part of this journey, as you were looking for ideas, talking to different companies, different founders. Um, I came across Sharat, uh, right, another great human being and a great leader. And then we hit it off, um, right? And uh and then we all decided that it it makes sense for all of us to do this together and then build from there.

SPEAKER_01

God. And and you were building in sales and support. So what led you to shift to customer service?

SPEAKER_00

Yeah, I would say so. Uh initially, uh, when I got excited about speech and voice, um, I was thinking about where do I know voice happens. And there were two areas I could think of sales and customer service. I was initially more interesting interested in sales, um, to build tools and technology for sales reps and inside sales teams uh to help them do their job better and faster. Uh, but as I spent more time in there, I very quickly realized uh that it's not that big of a dam. Uh and that world is changing very, very fast. On the other side, Sharad had spent a lot of time in the Philippines in his previous job. So he convinced me that no, customer service is a much, much bigger market, and that has never been touched. Yeah. In sales, what was happening was there was a lot of companies trying to solve similar problems. In customer service, as I said before, no one really considered it seriously. So it was kind of untouched. So Sharath convinced me to go to Philippines. So we actually went to Philippines together, and he exposed me to everything in Manila, and my mind was blown. I was like, this is huge, this is crazy. And that's where we shifted from like, no, we're gonna build for customer service, and customer service and AI is gonna be our destiny.

SPEAKER_01

And another interesting learning for you was that uh you initially tried to convince BPOs to buy your solution, but they were they were not the right segment. Uh ultimately, you landed had to land up in enterprise. Share that learning. How did that happen?

SPEAKER_00

Absolutely. Um, so the way we we learned about customer service was through spending time in Manila. And Manila is all about BPOs. So I would go to all these large BPOs, the ones that we all know of, sit on their floors, watch agents, watch supervisors, watch managers do their job. So for us, customer service meant BPOs. You know, we were not from the industry, so we never really understood the dynamics of enterprise and BPO outsourcing, none of that. We thought BPO is customer service. So because we learned a lot in that market, we also initially tried selling a lot in the BPO market. So I would go to all these large BPOs, try to tell them the value of the product, technology, and very quickly we realized that BPO is not the end decision maker. BPO is not the one buying the product. BPOs are basically at the call it like they are dependent on the end client to tell them what to do. The end client is a decision maker, they decide what technology stack will be used, and BPO is just doing that. So trying to sell to a BPO doesn't make sense. You have to go to the end enterprise. So we definitely spend six months trying to sell to BPO, we would not make progress. We will get a lot of conversations, we'll get a lot of meetings, we'll get a lot of learnings. But then when it comes to, hey, will you buy, will you deploy? They're like, no, we cannot do that. It's the end customer who buys and takes a decision and they deploy and they tell us to use it. So we are the end users, but we are never the buyer. And so it was a big, big learning moment for us because we did spend a lot of time trying to sell to BPON and very quickly realized it's not going to work. And we and we moved on from there. So since then we have only and only been selling to enterprises.

SPEAKER_01

And there was another learning, right? You were trying to sell to India markets and Philippine markets.

SPEAKER_00

No, I we never tried selling to India markets.

SPEAKER_01

But you shared like some of the horror stories.

SPEAKER_00

Yeah, that that was actually very late, uh, right? So, you know, talking about the India markets. So we were very, very, very clear from day one that we will never sell in India. Um, one, it was not a big enough tan. And the most common mistake that I heard from founders who had sold in India was it's a very vicious cycle. So start a company and you're looking for your first customer. What do you do? You call up your friend, you call up your investor, you're like, hey, can you make an intro? That intro ends up being somebody in India. So you get your first customer in India. What happens then? That customer tells you product feedback. So you're building a product. So you start building a product for Indian market. Then, because you have built a product for Indian market and your positioning in messaging and pricing is now slowly becoming towards the India market, the next customer you get is another Indian customer. Then you start building a CSM team for that. Um, then you're like, oh, I can get similar customers. So we hire a sales team. So now what you've done is you've built your entire company and DNA for the India market. And then now you say, okay, I have to go to the US market. And a lot of times what founders end up doing is they say, okay, it's so easy. I just hired two sales reps in the US. And I'm like, never. It's never ever going to work. Because it's not just about your sales. Your entire company is meant and built for Indian needs. The pricing, the packaging, the positioning, your org structures, everything is meant for that. So if you have to now sell to India, you almost have to start a new company. You just cannot say, I'll hire two sales reps in Bay Area and they will start. That's not how it works. So we were very clear from day one that we don't want to make that mistake. So we only built for US.

SPEAKER_01

But but in Observe 2.0, you mentioned there was one interaction with the Indian Krasna that puts it.

SPEAKER_00

I mean, I think this is actually not in the Observe 2.0, but this is like, I would say, um we've ever we only ever ever sold to one Indian customer. And that's because it came from an investor, uh, mutual investor, a great brand in India. Uh public, uh, they recently went public. So all amazing things. Uh, they were a customer, uh, very large customer. Call it like more than half a million for us. So we sold them. Um, we started delivering all good things, right? I think for the first year they paid us, second year they stopped paying. It's a three-year contract. They did not pay for the second year. And we kept chasing them.

SPEAKER_01

And they were still using the services?

SPEAKER_00

Yeah, they were using the services. They would not engage with us. They they would not reply to us, they would not pay us. And eventually we decided to shut down the service. And they even then they did not engage with us. Um, right. Even though it was a three-year contract, they were supposed to pay every year, supposed to use the services for three years, they would not engage. I've never seen that kind of experience here in the US, right? That someone just disappears, especially for a half a million dollar plus contract. Um, so yeah, that's another reason why I would never ever sell in India.

SPEAKER_01

And and uh you mentioned there are some guardrails in the US that protect both business and consumers from those kinds of behaviors. What are those guardrails?

SPEAKER_00

I think we are just more professional here. Uh, right. Like there's a contract between two entities. We respect that contract, both parties, right? I'm supposed to deliver services on time with high quality, with high SLA. I will do that. You have your commitments to me with respect to payments, with respect to what you will deliver as part of this engagement, with respect to maybe a Case study, maybe a PR, all sorts of things. And everything that's in the contract, we live by that. Right. And anytime we don't do that, we will have a conversation, or I will engage with you more formally through a legal letter or anything of that sort. But there's no, I can't disappear, I can't ghost you. Not as a vendor, not as a customer, right? So it's far more easier and professional, I would say, uh, to work with US customers than only the one experience we had with India customer. We we are still in a legal situation with the India customer, but doesn't matter. I don't think it's gonna go anywhere. Um so we'll just write that off and move on in life.

SPEAKER_01

That's that's a very hard learning.

SPEAKER_00

Yeah, yeah. But I mean, the good news is we knew that uh from the very early days. That's why we never sold in India. So it was not the hardest thing. I know this might come off come off as rude or arrogant or racist or whatever, but no.

SPEAKER_01

Um you use some from Bhopal. It's not like Hido were in Ari.

SPEAKER_00

I am from there, but it's just hard to do business. Yeah. Um, how do I do that? So that's that's a part of it. We when we finalized the idea and uh what observe uh will be, uh it's always going to be US go to market, right? So we were building for North American large enterprises who have large customer service teams. So we were very clear from day one that's going to be an ICP, that's going to be uh initial market. So it did not make sense for me to be in India because our customers and market will be here. And you want to be close to your customers to rapidly iterate with them. So from day one, I decided to be here closer to customers and closer to our market. You you want to be doing that, right? So you can your iterations are shorter.

SPEAKER_01

So what gave you the confidence again that first time? You were feeling like an underdog in the in in in SF, right? That uh you're not meant to build here. Yeah. The second time you had like destiny brought you back here. So what made you confident the second time?

SPEAKER_00

I think it was it was the fact that we got accepted to YC.

SPEAKER_01

Okay, so so you were in India when you got accepted into YC? Yeah. Wow. Yeah, yeah.

SPEAKER_00

So the journey is like we raised a small seed round, pre-seed round in August of 2017, applied to YC. Uh, we got accepted in December uh for the winter 18 batch, March, Jan, Feb. Um, and then that gave a lot of confidence that we are legit, uh, that we are a real company. Um, and back then, you know, I I don't know what YC does today, but back then there were not too many YC companies. There were not too many companies.

SPEAKER_01

20 companies in your batch, I don't know.

SPEAKER_00

No, no, no. I think it was 50.

SPEAKER_01

I don't know, 50 or 100.

SPEAKER_00

Yeah, but it was not 250 as of today, right? And the number of batches were also less. There was a winter batch and a summer batch. I think now there's like four batches and other things, right? Um so that gave us a lot of confidence. And then when we came here, uh going to YC gave us a lot of confidence. And then right after that, uh Nexus coming in and investing immediately after YC or during the video. Yes, yes, right after YC. And that gave us a lot of confidence that okay, we are real. We are real, we're here to stay. We're gonna make a US company, we're gonna sell to US customers, and we'll go after it. The confidence that we didn't have before. Or I didn't have before.

SPEAKER_01

Yeah, so some somebody believing in you gave the confidence.

SPEAKER_00

That is very, very important. I I think it made me feel that I'm legit. Yeah. Uh yeah. That was an important part of it.

SPEAKER_01

But that happens to a lot of Indian founders, even even me, right? Uh uh when we come to the US for the first few times, it seems very daunting. Though I'm recording setup of studio in SF today, right? But initially it it felt very daunting to come here. Uh it it feels like uh the place makes you feel small. It does.

SPEAKER_00

And I think that so there's two parts to it, right? That that I personally feel. Um I don't think there will ever be a time that the place will make you feel big. Yeah. Uh because there's so many amazing things happening in Silicon Valley and Bay Area that no matter what you end up doing, right, you will always feel small, which is part of, which is in my mind is a feature, not a bug, right? Because it pushes you harder.

SPEAKER_02

Yeah.

SPEAKER_00

It makes you more ambitious, it makes you want to do more, uh, right? It, you know, it's it's it's it's a feature. It's like, okay, guys, we're never enough. We've got to be doing more and more and more and more. The second part of that, um, I would say, uh, right, that that is a key part of um is I think it's also to do with culture. Right. At least that's that's true for me. Um, like engineer, uh never been that outward, um, right? More focused on building, um, right. And you just coming to US, uh, right, never being part of US culture, now wanting to sell to US people, right? Um it's not that easy. And I do feel like there is always that element in, at least for me, right? And and it might not be relevant for everybody. There was always that US is superior to us, uh, right? US people are superior to us, they're smarter than us, right? They're better than us, right? That also plays in your mind, right? When the reality is, no, you know, it's about talent and meritocracy, and US is a great, great place. I mean, the American dream, right? But somewhere it's in your mind. So I think the lesson for me from all of this was US is one of the best places to build. It's one of the most meritocratic environments in the world, right? So take away your mental blockers because it's actually not reality, just your perception. Uh so that's probably the biggest takeaway that I had from that.

SPEAKER_01

Yeah, yeah. I'll share a small example. Like before the podcast, I was sharing you the stats, right? Neon show today has over a lifetime 120 million views. Globally the highest venture Apple category. Second is uh Y Combinator at 99 million views, though they have 10x the number of subscribers in us, and third is uh A16G at 20 million views. Okay, that yeah, and I feel nobody in us that's why I have to watch it.

SPEAKER_00

Which is great too, right? Because it pushes you to keep doing more and more, which is amazing. Um, but it's incredible, and congratulations on uh on on building an amazing podcast and audience.

SPEAKER_01

Thank you. Thank you. But but yeah, that is true. I think probably from our upbringing in India, small towns, uh that uh, you know, it uh usually the place makes you feel intimidated.

SPEAKER_00

It does, it does. Yeah. I that's what I'm saying, but it's it's still part of it's it's a feature.

SPEAKER_02

Yeah.

SPEAKER_00

Right? It's it makes it will always do that, so it pushes more out of you. The day you are complacent in the the very the day you feel like you're doing great, you won't push yourself. Right? So yes, keep pushing yourself is the is the motor here.

SPEAKER_01

Yeah, and at what point of time, you know, you race from Nexus, right? Uh probably if you can share some milestones during the journey, one observe one point go uh post-Nexus, what are the revenue milestones? Like when did you cross one? When do you cross 10? When did you cross 15? Yeah. And what are those funding milestones that you achieve?

SPEAKER_00

Yeah, no, no, absolutely. So I think uh, you know, that year, uh 2019, 2018, when we raised from Nexus, we were early, we're just getting started almost pre-revenue, right? Um, so that was sort of like our more product building year. Um, right, but we did cross um a million dollars in revenue at the end of 2018, uh, right. Product was out. We got our initial customers. Uh, we started selling in December, I remember, December of 2018. Um, started getting our customers. Uh 2019, we started building like a go-to-market team here in the US, hit roughly like two million ARR by September 2019. And that's when we did a series A round from scale, raised about $26 million, um, and you know, then started focusing a lot more on growth. Uh, right. Product was built, product was ready, and we had also figured out who what is our ICP and TAM, not going after the BPO, but enterprises. Uh so started getting getting um large US enterprises. 2019 and 2020, disruptive years, right, from a COVID perspective. Um, we were still doing mid-market. So we were doing, call it like 100k to 250k DD sizes. Uh less like the mid-market of US, not going to Fortune 2000 just yet. Um and you know, 2019, we raised Series A, started building the go-to-market team, COVID happened, we saw a huge surge in uh uh in demand because everyone was moving call centers remote. And when you are remote, you need a lot more analytics, lot more monitoring uh to do that. So that happened, which was good for us. So we raised a series B in the middle of 2020 during COVID, uh all remote. Um, so we raised a 50, $54 million series B uh back then from Melo Ventures, uh, and then scaling.

SPEAKER_01

And what revenue were you at when you ran?

SPEAKER_00

Um we were about $5 million, right? But scaling well. So that year uh we hit close to 10 million in ARR. And I think the big milestone at the end of 2020 uh was also like we closed our first million dollar customer, uh, a Fortune 100. So it's amazing to get that value. And then from there on, it was a lot of scaling on the go-to-market side in the enterprise segment, but also technology was changing. So roughly around 2020, 2021 time frame, LLM started coming out. Not ChatGPT, but BERT, Google Bird came out. So we started tinkering with that and realized there's gonna be something massive that's gonna happen in AI. And 2022, ChatGPT happened. Um, right. I mean, ChatGPT happened in November. Before that, we raised our CDC uh from Softbank uh in January of that year.

SPEAKER_01

Um that was $125 million.

SPEAKER_00

$125 million. So that gave us a lot of ward chest to continue to build one of the largest companies in the customer service AI space. And then, but we kind of shifted a little bit, not just doing go-to-market, but product evolution as well. So up until then, our product was more focused on as we discussed quality training, uh, QA, and so on and so forth. But then we started going into a newer product area. So the next one we launched as speech processing got better, cheaper, faster, as as LLM started coming out, we started focusing on more real-time processing and the use cases we could solve with real time. So we focus a lot more on uh real-time agent guidance, right? So you're a customer service rep, you're talking to your customer, you're listening to them, you're answering questions, you're looking at knowledge based at FAQ. We built a system that could listen to things in real time, analyze all these things, and guide the customer service rep. Uh, this was still, I would say, pre-LLM.

SPEAKER_01

And what revenue you were at when you raised from SoftBank?

SPEAKER_00

Uh, we were close to 15, 1.5. Um so the company was doing well uh right from a from a growth perspective, from TAM perspective, product perspective. And I think we then started feeling that some with Chat GPT, we're like, hey, what's the long-term future? Um, and that's sort of like when I would say the genesis of observed 2.0 thinking started coming in, right? Um, early days.

SPEAKER_01

Just wait a minute here. Yeah. Because but there were no external shocks or signals like you were still scaling well.

SPEAKER_00

No, uh, so it was not our scaling, right? You have to ask the question that what's the long-term future? If LLMs are gonna be so powerful, everyone was using Chat GPT, and ChatGPT could answer so many questions. You have to ask the question that before that, so many chatbots and voice bots came, nothing ever worked. Yeah, the need was there, technology was not there, but now technology is also there. So when you combine the two, it started becoming very clear that a lot of customer service in the next five or seven years will be done by AI. So then you have to ask the question that yes, I can keep growing, but that long that revenue is not long-term. It is not gonna last. And as I said, we were not building a company for three years or five years and selling it off. We were building for a decade or generations. So then you have to go through these things and be okay with that. Like, hey, this product is great, it can keep growing, but it's not gonna be, it's gonna give you a billion dollar outcome or a very, very large company. And that's okay. So you have to take those calls. So the the the that moment made us think that, hey, we need to think a little. Um, and that's when we started thinking about okay, how does the future look like? What happens with LLMs becomes more and more prevalent. So we then started focusing on more LLM-based use cases in customer service. So for our agent assess solution, we added things like summarization, note-taking, uh, pulling all the information from knowledge using RAG-based systems and things like that. So that's how we thought initially how we responded to the LLM thing. But then as we started playing more and more with LLMs, as we started playing more, as agents happened, AI agents happened, then it was like clear in our face that we have these AI agents are gonna dominate customer service. They will do most of the customer service work, the calls, the chats, the emails, which means what will go to human will be far less and far complex. And when you look at what we have built so far, was not built for this future. That was built for a future where customer service reps are doing simple queries and all the queries, and there's still manual work being done, and people are still using SaaS products and workflows and UI. And we started questioning in roughly, I would say, end of 2024, no, it's all gonna be AI agents. It will be AI agents that will be doing everything throughout the customer lifecycle. So that was the big, I would say, aha moment for us to say, no, no, no, we are not building a company that's gonna last very long. It doesn't mean that we can't get some revenue quickly. That's not the problem. But when you have investors like a soft bank or a MEL or anybody, nobody cares about a small company with some revenue. Everyone is like, hey, we have to go for the big game. So that's when we started thinking about a much, much harder pivot and change in company strategy that we're gonna think about how customer service will happen in the future. And it became clear AI agents will do a lot of the customer service on voice, chat, email. They will take care of most of your common, simpler routine queries. What will be left for the human customer service reps will be a lot more complex stuff. So, how do we build a platform that supports that? And we started building that platform completely separate from our existing platform, uh, which had which is an uh agent builder platform, and you can build agents across the customer journey. Uh, we started launching it last year, and we since then we have been growing uh 5x year on year. And that revenue is what will last very, very long. You can see incredible growth, right? It's not about 20%, 30%, 40% growth. It's like 5x growth year on year is what we are tracking uh against our agentic platform, right? And you're building for the future. So that's observed 2.0, uh, right? It required a big pivot uh for internally, obviously, big transition for our board members, our company, our team, our culture, our brand, uh, everything. But hey, here we are, observe 2.0 and kicking ass.

SPEAKER_01

And there were some uh other moments in the journey, right? Two of your co-founders started their own companies. Yeah. So how did it feel back then?

SPEAKER_00

Actually, so this is one thing I feel like very lucky. Um, right. Uh I mean, obviously Sharat and Akash, uh amazing people, amazing co-founders, right? But as companies started changing, companies started evolving, uh, right, both of them felt, hey, you know, uh, this is the time to leave and start something else or do something else in their life, right? Which, from a relationship perspective, as you also know, like we're very close friends, you know, we support each other. I'm an investor in Sannus, I'm an investor in Sharad's fund, uh, right. So even though they both left, I think what I got really lucky with is I've always thought of my exec team as very similar to co-founders. It has worked out really, really well, actually. In fact, I mean, our chief scientist, right, who we hired in 2019, right, he played such an incredible role in the company, um, right, that it became obvious uh, right, that he should be a co-founder. So, you know, we we asked him to step up and be a co-founder. So he's he's an official co-founder for the company, plays a significant role in the company. And then even the rest of the exec team members, right? I kind of have never felt that difference between a very good exec who is very aligned with the company, the culture, the mission, vision, and me different than being a co-founder. So all my execs know everything. We are very close, we talk a lot, they know a lot of the internals of the company. And so I've never felt from that gap, if I can say, right. And as I said, Jeet, uh, who is a co-founder now, um, right, he stepped in beautifully, uh, right, to fill in not just the gap of a CTO, but also the co-founder.

SPEAKER_01

So, how big is the team now?

SPEAKER_00

Yeah, so we are close to 300 people uh with a good split between India and US, India is all engineering, product management, AI, uh, US is all go to market, uh, and we recently started building a good engineering presence in Bay Area as well.

SPEAKER_01

Cool. You mentioned that some point in time of the 1.0 hit 50 million ARR. What was that moment in time?

SPEAKER_00

Uh that was last year.

SPEAKER_01

Okay.

SPEAKER_00

Yeah. So we we're doing well. We work with some of the largest brands you can ever imagine um in the world. All Fortune 100. Uh, we have great retention, great usage, great product love. Um, right. So on one side, we were we were thinking, hey, this this company, this product, these customers are doing so well. On the other side, we were like, nah, this is not gonna last. This is not gonna last. AI was gonna change. And I we wanted to build a company that lasts like um a much, much longer time period than a few years.

SPEAKER_01

Yeah. And uh during this journey, right? Uh, did you stop selling the previous product?

SPEAKER_00

Like, yeah. We almost like, yeah, we stopped selling. Uh, we incentivize all of our sellers and marketing team to just focus on newer products. We still get demand for our older product, but we've also transformed that to agents. So now we are selling agents. So we still serve the same needs, but through agents. And that works beautifully.

SPEAKER_01

In in future, where is customer service headed globally? Let's say let's uh uh uh focus on where is the macro going towards yeah, I think it's uh it's there is two thoughts I have on that, right?

SPEAKER_00

Which are kind of contrary. Um so on one side, what is very, very clear to me. So right now, roughly there is like 20 million customer service agents, roughly $400 billion of spend, both on people and software included. On one side, I'm a believer that AI is gonna take a lot of that. AI is is constantly doing more calls, more checks, more emails. Even our customers, right? We are seeing AI take so much. So on one side, I believe that if you draw it out three to five years, more than 50% of the customer service interactions will be fully handled by AI very comfortably. So what I mean is the customer service interaction will be handled. Now, what I don't know, and we are still figuring out, is is the volume going to increase and hence the agents are not the human reps are not gonna go down? Because even within our customer base who have implemented advanced use cases for voice AI and not yet seeing reduction in their customer service teams. So on one side, I'm like, hey, AI should be doing everything, you should not need these many customer service reps. On the other side, I'm like, when will I start seeing any impact? Um is is what's happening is that because AI is doing a lot more, but the volume is still growing, so the agents are actually not reducing. So I'm I'm kind of like torn between the two, right? On one side, as an engineer, as somebody in deep in AI, I'm a believer that AI will do a lot. So you don't need this many teams. So maybe you don't have 20 million agents, you have 10 million agents, right? Out of the 400 uh billion dollars, significant money has gone into um into software and AI. On the other side, uh, as a as just a data person, I'm not yet seeing the data. Maybe it's too early. Maybe I'm gonna see next year, right? Or maybe I'm just completely wrong, and the volume is growing so much that I will never see the agents reduced. So maybe a better time to ask me that question will be next year when I've actually seen the data. I've not yet seen any data from any of our customers.

SPEAKER_01

So maybe the amount of work getting done is increasing.

SPEAKER_00

Yes, that's that's my point on volumes increasing, right? So maybe the volume is increasing. So what AI is doing is also more, but the volume that was going to humans is still the same because the overall volume is increasing. So hard for me to say right now. I think the data suggests that AI is doing a lot, but I've not seen reduction in customer service reps by any of our customers. Uh, and we have customers who have tens of thousands of agents. So we would be the first one to see the impact. And the reality is nothing yet. Doesn't mean it, you know, I don't believe it's gonna happen, it will happen. But I don't know when.

SPEAKER_01

It's very interesting to know. You're saying the the customer service reps are not uh reducing, but at the same time, uh in software development, the companies are cutting their teams by half.

SPEAKER_00

Yeah. Um, I don't know the answer to that. Um but that that's actually very interesting because in cust in in software engineering, you could argue that there is no ceiling to how much software you can build.

SPEAKER_02

Yeah.

SPEAKER_00

So it's not that I have this amount of work and now AI is doing so much, so I need less people. You can actually just increase the work. You can build more features, you can build more capabilities, you can launch more products. But I think it's also coming from the fact that I think in general, everybody is realizing that it's it's less to do with like you need less engineers because of AI. I think every company, every CEO, every board is realizing most companies were built for pre AI era are just bloated. Are just bloated. And there are a lot of people who are not doing the work that matters. There's wrong processes, wrong systems, right? And you're just bloated. So that's, I think, maybe what you are seeing or you're referring to when we think about AI doing more software engineering and we need less engineers.

SPEAKER_01

Yeah, every cut company that I know is cutting tech or non-tech. Yeah. Cutting their engineering team by half.

SPEAKER_00

I'm not going to comment on that.

SPEAKER_01

But but it's an interesting time that, you know, we don't know what new use cases will come in customer service.

SPEAKER_00

That's that's my point. I think we'll we'll find out. Um I have not seen the data yet from our customers.

SPEAKER_01

And you still believe we are very early in the journey of engineering.

SPEAKER_00

I think so. I think uh I believe this is the very first innings of uh voice AI agents and customer service AI agents uh very, very early. I think the way technology is evolving, the way stack is evolving, um, this is a long game. And it's a multi uh hundreds of billions of dollars of market.

SPEAKER_01

So you're thinking more than CRI and Decagon will get created in the future.

SPEAKER_00

Yeah, uh there's a very high chance CRI will get killed.

unknown

Why?

SPEAKER_00

There's a very high chance Decagon will kill. The stack changes tomorrow, what happens then? You will you will continuously see. So you have to believe in technology and evolution. No one knew Chat GPT will happen. We all could, before ChatGPT, we could all could have guessed, you know, this is the winner, this is the largest ARR. Chat GPT happened jack shit. Nothing matters. And there's new winners. So you have to believe that this game is not over yet. The game has just started. And the reality of a lot of, in full reality, a lot of the so-called ARR that you see with some of these companies that you mentioned is actually contracted ARR. So none of this is ever actually deployed in production at scale. Find me one real customer from any of the companies you mentioned who has actually reduced the number of people they've deployed.

SPEAKER_01

None yet.

SPEAKER_00

That's it. So it's it's a lot of VC, Silicon Valley fluffing happening right now. And we'll see where this goes. I believe we are very early in this game and there's gonna be a wash uh that's gonna happen. Either because we will see live deployments not going successful or technology disrupts everything that exists today.

SPEAKER_01

So so you think that the AI bubble is going to burst sometime?

SPEAKER_00

No, I don't mean AI bubble, right? Uh AI is real, it's here, it's we're seeing use cases, but I'm challenging the notion that AI is steady. You are coming from a perspective that the AI evolution is done. So now all the companies built on this evolution have succeeded. And I'm challenging that.

SPEAKER_02

Okay.

SPEAKER_00

If that was true, five years ago, there was some AI, you could have made the same argument then. That completely killed or washed all the companies that built on that AI. I'm making the same argument. The world is gonna change so fast, so the whatever we call as these AI companies might not matter. It's a very likely outcome.

SPEAKER_01

Now, what are the things that you work on as a founder today?

SPEAKER_00

It's it's changed quite a bit. I would say, in many ways, um I'm almost running Observe. Um, and because it's Observe 2.0, in like a hard founder and a wartime mode. And also, I would almost say like a seed to series A company. I'm not running this like a 250 people company or a series C mature scaled company. I'm not doing all that. Uh, right. And the reason for that is you have to you have to understand anything that was built before 2022, 2023, both from not from a product perspective, culture, process, systems, org doesn't matter. So I almost have to recreate Observe 2.0 and every part of it. The culture, the tech stack, the products, the people, the org structure. So I am basically working at the ground level every day to change every part of the company. So I'm in many sales cycles. I'm working closely with our customers, I'm working very closely with our product teams, I'm working very closely with our engineering teams, I'm working very hard on redefining our culture, right? I'm not operating at a very high level. I'm actually operating at a very low level because, as I said, we are back to building. I treat Observe 2.0 as a seed state startup, where we still have to go uh and build a new company. So so I'm basically uh a lot of this like what you would expect from a seed state. Oh, I'm working on product, I'm working on with the engineering team, I'm working a lot of deals. I do that. I prospect myself, I work uh directly with our customers, prospect, sales cycles, everything.

SPEAKER_01

And and as a founder, how did you learn GTM? Because uh earlier you had Sharatav, one of your co-founders leading GTM. But once uh you are the one who is the founder and the CEO responsible for the GTM also, how did you learn?

SPEAKER_00

Yeah. I think it's it's a lot of learning by doing. Um, right, you you start doing things. So you're very early, you're like, okay, how do I generate pipeline? Okay, you know, you write blogs, you you can research very quickly, you can talk to five more founders who have done this, right? And they will tell you, hey, generate a lot of content, build good LinkedIn presents, start doing LinkedIn outbound campaigns, uh, start doing uh create account list. Okay, right. So what I've realized in general in any business is nothing is rocket science. Pick any industry, any business. It's just that you don't know it. And so all you have to do is, again, as a founder, you will be doing almost every single thing in the company that the company needs, from sending a recruiting email to sending a prospect email to all kinds of things, right? So you have to be open with that mindset that you are going to learn all these things. And you just have to go out and talk to great other CEOs, talk to great VP of sales, VP of marketing, and just absorb and come and do it. That's the only way you could do it. At the same time, it's also very unless you are a deep infrastructure company where the CEO could be very, very technical in an application stack company. The CEO needs to be a great marketer, great seller, great visionary, great product person, know about engineering, know about everything. There's there's no two ways about it. And so you just have to go about and doing it. So doing is the best form of learning. And you will fail, and that's okay. Okay.

SPEAKER_01

And how do you manage all of this within a limited time window, 24 hours every day? Um every every bug now stops at you.

SPEAKER_00

Yes. So that is true. Uh right. So I would say, like uh in Observe 2.0, uh, right, I one of the key things that we also had to change was because, again, as I said, we are going back to building a seed stage company or a series A company, you have to re-impart the thought process, the new culture, the new vision again, which means that for some period of time, you have to take all the decisions. Because it's starting from you, no one else knows what's happening or what's the vision. So at one point, right, I would almost hold all the decisions and do all the reviews, right? And be owning all those things. And then at, but but what has also happened with that is there's a lot of amazing people in the company who have come to learn the same way and they've figured out what's a new vision, what's a new operating culture, how do we operate at Observe, and what does new observe look like? And in doing so, we've also hired some people who have directly landed in Observe 2.0. So now I've also reached to a point where there's a lot of people in the company where they're operating Observe 2.0. So I can step back. And I have done this kind of one by one, right? So we started with like one product and engineering area where I was day-to-day, right? And then I was like taking every decision, every call. And then I started stepping back. I'm like, okay, this is figured out. Then we moved on to some other phase, some other phase, right? So I'm right now going pillar by pillar and saying, all right, I'm gonna be doing everything and I'm gonna be taking all the decisions. They will run by me until you have all have learned what 2.0 means for me. And I think I've come maybe 60, 70%, where a big part of the company now understands what is observed. Lean teams, shipping really fast, aggressive mentality, working with insane urgency, and they're killing it. Right. So I'm going through a journey with the rest of the teams as well. That we are in it, we're moving fast, we are killing it, and that's that's new observed 2.0.

SPEAKER_01

And uh how how hard has been in pushing your team? Because you can't let go of your entire very.

SPEAKER_00

Right. It's been very, right. And I think I would say it's been the people part has been the most challenging part of this, right? As I said, as part of this process, right, we also we had to let go quite a bit of people. But also, you know, the the downside of this is a lot of good people also leave, right? Because they're like, this is not the company I joined. What is going on? Why is CEO showing up in so many calls? Why is he taking all the decisions, right? And the the unfortunate part of that is there is nothing you can do to explain and make them understand what's going on.

SPEAKER_02

Yeah.

SPEAKER_00

But in your mind, you're clear that you're rebuilding the company, you have to re-impart the cultural values, you have to re-impart um the product vision, right? And it will take some time. So you almost are sitting every day, right? So it's one of those things where you know that you are at point A. You are clear that there's a path to point B, but you also know that that path is painful. So every day I'm waking up and I'm seeing resignations and saying people leave, I'm seeing moral issues, and I'm going through it because I know there is point B on the other side, which is far, far better, far, far amazing. And I would say we are maybe 60, 70% through that right now. We have been on that journey. It's been hard, but we are very clear that is what success looks like. Um, so uh yeah.

SPEAKER_01

So do you keep Observe 1.0 and 2.0 teams separate?

SPEAKER_00

Like no, now everyone is 2.0. We have been on that journey for a bit now, uh, right? So everybody is now Observe 2.0. We uh took the older product, right, that we built, completely replatformized it. It's now all agents, and whatever new builds is all agents anyway. Sellers are all agents, marketing is all agents, um, it's agents everywhere. So now the entire company is 2.0. It's been an 18 months transformation for us.

SPEAKER_01

So during this journey, you've been quite transformational as a founder. What are some of the strengths that you realize that you had? Uh and what are the areas of weaknesses?

SPEAKER_00

Plenty of weaknesses. Um I think one is I could be more decisive. I I feel I'm decisive, but I could be way, way more decisive because I think what I realize is sometimes sometimes you feel you realize that everyone is looking up to you for an answer. Just tell them the answer and so they can execute. And I think at times I was not that clear. And making hard choices, being clear about them, you know, drawing a hard line, some of those things are very important. Maybe I I should have done that. Second thing, I feel like I I was a little too late in the 2.0 transformation. Maybe we should have done a year earlier. So I could have done this sooner. Um, I think I underestimated the power of LLMs and the power of where where the where AI is going in general. Um, so that was the other, I would say, miss I had in this. Um coming to I would say strength, I would say the the only thing that I sometimes feel that I'm likely good at is see, starting a company and running a company and going through all of this is very, very hard.

SPEAKER_01

Very painful.

SPEAKER_00

Very painful. Painful is actually painful is a better word. It is, it sucks. It sucks a lot. You wake up, well, like this customer is churning, this person is designing, this offer didn't make it, board is yelling at you, this is happening. You're like, why the fuck am I doing this?

SPEAKER_01

Yeah, you want you want your head to put in sand like off strength.

SPEAKER_00

Right. Like, what and so it takes a lot of grit and courage to wake up every day, shower, go to the office, and show an amazing face. That no, we are killing it and we're gonna kill it. That's probably, I would say, one of my potential superpowers. Where, okay, world is on fire, shit is on fire, I'll show up. I'll make this too. Because I think, and that also comes from the fact that I know what's on the other side. So I'm actually very, very excited, very, very positive. So I can go through the pain. So that also helps me go through the pain, which is like, hey, I'm building the biggest company in customer service space, which is gonna last decades, and we're doing that now. So going through all this pain is okay. So that really helps me go through the cycle. So I would say we can call it grick, maybe courage, um or potential strength. I would say potential because I don't know if there are really strengths or not.

SPEAKER_01

But but you have been uh uh very steadfast in this in this journey. Now it's almost coming to a 10-year or completed 10 years as an entrepreneur.

SPEAKER_00

Sorry, say that again, sorry.

SPEAKER_01

So I'm saying you have been very steadfast.

SPEAKER_00

Like what do you mean steadfast? Like fast or slow?

SPEAKER_01

No, steadfast means that uh no matter what happens, I'll continue. Whoever leaves, co-founder leaves, investor leaves. I I'll continue. Yeah. And it's been 10 years. Yeah, you could have chosen to walk away and build another company. Yeah. Uh right from extremely clean slate.

SPEAKER_00

Yeah. No, I mean, yes, of course, but I believe in this. I mean, I strongly believe customer service, we established that one of the largest markets in the world. We are very well positioned. We have one of the largest, one of the best customers that you can have on the planet, some of the best brands that you can ever imagine. We have built the technology stack and the product stack for the future. We have a world-class team. I'm here to win. This is it. Why do I, why would I think of another company? This is gonna be a multi-billion dollar outcome for me, for my investors, for everybody, and for our customers. So, you know, if you asked me that question maybe two years ago, that would have been a more interesting question. But I think we are on a different side right now. Uh, and we will kill it and build the largest company in the space.

SPEAKER_01

What gives you that confidence?

SPEAKER_00

Great product, great people, great customers. Easy. It's a simple thing.

SPEAKER_01

And how are you rebuilding your GTM team this thing?

SPEAKER_00

So we have been on the journey. Um, right. I would say uh so far, it's it's more specific, but our go-to-market always used to be more inbound-led and more partner-led. Um now they're focusing a lot more on outbound-led go-to-market, which really helps in scaling. And then second, we're really thinking about a partner-led strategy from a GSI perspective. So we never really focus on the GSI style partners, but what we're realizing is from an AI transformation perspective, a lot of these projects are led by GSI. So, you know, the likes of Accenture and Infosys and Genpact and so on, uh, they do very, very large projects uh for large Fortune 2000 to help them um optimize and improve their customer service. We're partnering with them uh to go to their customers. So those are the two big things we are changing in our go-to-market as we as we move forward. But otherwise, we have a pretty strong team, pretty strong sales reps, marketing team. We're pretty well set in in growing there.

SPEAKER_01

Uh voice is one of the most crowded categories in India. I don't know whether you know that. Uh you said India? In in India. Okay. Right. India, there are 100 plus voice i companies which are building voice for India. Okay. Right. And I assume they've, if it's that's the scenario in India, US might be there a thousand companies.

SPEAKER_00

Yeah.

SPEAKER_01

So how do you how do you compete in such a competitive market?

SPEAKER_00

So, I mean, number one, we don't think of ourselves as a voice I company. Uh right, voice i in our in our world is a small part of the overall picture. So the way we think about it is we are building the future of customer service, right? And voice AI, customer service automation, self-service is a small part of it, right? You also have to think about what happens when the call gets handed over to a human agent. What kind of tools do they need? What kind of AI do they need? What happens, what do the operations team need to run that kind of customer service department? How do they do quality? How do they coaching? How do they analyze the AI agent calls, right? So we are not a voice AI agent company. For us, voice I agent are a very small part of it. In my mind, as you said, there are 100 companies in India, 1000 in the US. Voice I is a commodity. That's not the future. No one is going to make money in the long run on just being a standalone, simple vanilla YCI company. You have to build enterprise grade, uh, deep platforms. And that's where we come in, right? Of course, we have voice I and works great, but ours is a much, much bigger story where CIOs say, I need to transform my customer service. And they come to us saying, okay, use our YCI agents for automation, use our agent assist and agent copilot for human augmentation, use all of our agents for operations, for quality training, coaching, and so forth. One vendor for AI agents across the customer lifecycle, not sprinkled vendors across the customer journey.

SPEAKER_01

During your journey, where you come from, you mentioned you were an underdog founder, less confident, but suddenly YC happened, and then you were able to raise from tier one VCs one after another. What have you raised from those tier one VCs?

SPEAKER_00

See, it's just you could have a great product and customer base. Um, right? You can't force, you can't make up to make uh investors. Once you have a great product, you start getting great customers, right? That brings revenue, you're a great company. So I always say, like, you know, great companies raise great rounds. It's not the other way. So first build a great company, great product, great revenue, great customers, rounds will happen. Uh, right. So that's what happened with us. As I said, we found a large market, build a great product, got initial customers, revenue growing, and that really helped us uh raise, raise rounds from some of these amazing investors.

SPEAKER_01

Like Nexus discovered you from uh VC.

SPEAKER_00

No, I knew Nexus from way forward. Okay. Yeah, yeah, yeah. I I actually funny, when I moved to India, um, I actually worked with uh our Nexus partner just to explore ideas too. Uh so they knew me from a long time actually. Uh but when VC happened and idea got finalized and everything, you know. Okay. Uh Nexus was very supportive and came in as an investor.

SPEAKER_01

God. So so if you if you have to distill learning from your journey to the founders who are listening, what would they be? How to choose a market, how to build Yeah.

SPEAKER_00

I would say so. There's two parts. One, I I'll talk about the uh the company and then one I'll talk about the founder itself, right? So from a company perspective, it's kind of obvious things. Pick a very, very large market. Uh, don't pick a small market because any kind of company building is very, very hard. So why build in a small market? Go after the largest market on the planet and build a company in that market. Because small markets, it's not that the company building will be easy. Company building in general is hard. So might as well build in the biggest market. That's number one. For a lot of India founders, I will say don't sell in India. US is the biggest market for almost every industry. Go and start selling from here. Do not even think about starting from India. You will get stuck, you won't be able to make that jump. A lot of founders think I'll start in India and then make the jump. Don't do that. Start US day one, first customer in the US. Try very hard, it will take longer, but will be the right thing for you. So that's the second thing. Um, third is to compete in global markets and especially US market, you can't win on price or um, you know, uh any other differentiation other than product. You have to be in a phenomenal, phenomenal product to compete with companies because every industry you pick, every category you pick, you will find 20 more competitors. Many of them will be very highly funded, revered money. You will win through a phenomenal product. So that the, and then you know, standard things like choose great co-founders, complementary skill set, things like that. On the founder side, I would say, you know, as you're starting a company, think of entrepreneurship as a lifestyle. Like, do not start a company because you think you can make money or you will get a lot of fame. You never get jack shit. It is one of the hardest things that you will do in your life. And you will almost regret it every week, every day. Like, why, why, why? So do not start for any other reason other than because you will enjoy the entrepreneurial life lifestyle, which is you're all in, you're committed, you're excited about building, you're excited about the idea, you're excited about the vision, and that will keep you going. Do not try to start a company because you have seen a founder who made a million dollars in two years and you can make a that's this absolutely wrong reason uh to start a company. And finally, it's gonna be long. So enjoy the journey. Uh, right. As a founder, you know, it's a grind, it's hard, but enjoy the journey, have fun through the journey. Uh it's it's about the journey, it's not about the end. Yes, in the end, maybe we'll make $100 million, you will sell the company, we'll do IPO. Great. But it might be five years, it might be 10 years, it might be 20 years. So always enjoy the day-to-day uh of the journal.

SPEAKER_01

And you mentioned a very important point that only great product works in the US market. What's your definition of great product?

SPEAKER_00

Uh, it's basically great product means it will compete with outcompete the competition in the market, right? So, whatever category you are in, the user experience, um, the technology stack, uh, the support experience, all of that has to be phenomenal. Uh, right. Not it's not just about hey, I have a lot more features. Yeah, right. Oftentimes your experience is bad, um, your product looks ugly, and we think like, oh, they could be the fourth or fifth in the category, we can sell for cheap. It doesn't work too long. Um, so you really want to say, like, you know, I am categorically different. The other thing about differentiation is we always say, when you ask me the question, how am I different on voice AI, I'm not trying to be different on voice AI. It's a feature war. I will tell you that, hey, I do VAD very well, doesn't matter to the customer. So you have to be categorically differentiated. So when I go into a deal, I don't say my voice AI is better. I challenge the customer and say, Why are you just doing voice CI? You should do voice AI and you should do companion agent and you should think more broader. And I change the playing field. And when you change the playing field, you will be the winner. Don't fight in somebody else's playing field. Otherwise, you will be the loser because they have defined the playing field. So I tried to change the playing field. I didn't answer your question by saying my voice AI is better. It's not. I don't care. I change the playing field and talk about you know one platform for large customers.

SPEAKER_01

No, thanks, Sophnila, and enjoyed and learned a lot from you.

SPEAKER_00

Thank you. Thank you for having me.

SPEAKER_01

Thank you for showing so much courage as a founder. It's really commendable.

SPEAKER_00

Thank you.

SPEAKER_01

It's amazing to see your journey through ups and downs and completely changing our company 180 degrees.

SPEAKER_00

Yeah, yeah, yeah. I mean, it's needed. As I said, we're building a company for the next decade, not for one year, not for two years. And we'll do whatever it takes. And now, as I said, we're killing it, we're growing five X year on year. Company is a gen tech, we sell a gen tech, everyone is leaned in, so it's it's amazing.

SPEAKER_01

That's amazing to see this journey.

SPEAKER_02

Thank you.