Building a moat around the core product tech is key for a differentiated offering. Shashank Randev, Founder VC at 100X.VC shares his Anti Portfolio.
Prior to becoming an investor, I was the founding member of
VCCEdge where I monitored and analyzed early-stage startups in India. That
journey helped me in developing research skills for mapping comparable startups
across sectors. While there are multiple metrics a venture fund evaluates before
deciding to invest in a startup, angels largely go by their passion and gut. At
an early stage for angels, it’s a judgment call based on the founding team,
their pedigree and hoping the market size will continue to exist in the years
to come. Conversation in commerce for me was and continues to be a market to go
after where vernacular would be a huge opportunity.
Buzzo.ai was one such startup which met all these criteria
for me. I first met them in 2017 and decided to lead the investment round
through an angel network in August 2018. The founders were building a
Conversational AI Assistant for retailers. Both from IIT Bombay, had previously
exited from a successful start-up named Makesense Technologies which got
acquired by Info Edge India Pvt. Ltd. (Naukri.com) in 2013. They were still
building out the AI assistant that would understand a customer's need through
natural conversation, offering relevant recommendations and explaining why that
may be the best choice. They wanted to focus on enhancing their algorithms in
specific categories, I along with other angels wanted them to start with
initial Proof of Concepts (POC). Somehow by end of 2018, I wasn’t convinced
that they would be able to sell and decided not to lead the round.
In Sept 2019, Reliance-backed Haptik acquired Buzzo.ai to
leverage its platform to power multilingual experiences for the next 500
million Indians that will come online to shop. My learnings from this missed
opportunity was multifold. While it is important for deep technology startups
to sell their solution, building a moat around the core product tech– with or
without POCs– will remain critical for a differentiated offering.
Using these learnings at 100X.VC – early stage seed fund
investing through iSAFE notes – where we are backing startups at minimum viable
product or proof of concept stage and giving them the opportunity to build out