Incubating a Fat Startup at Greylock: Ash Ashutosh, CEO of Actifio (Part 7)

Sramana: What is the future of the fat startup situation. Of course the market is skewed towards lean startups. Good angels now want to invest in deals that have traction.

Ash Ashutosh: If you get back to the essence of business and the ability to articulate return versus risk, there is a lot of money that chases and enormous amount of risk. There is a boomerang effect where some of those investors want to see companies with customers. If you look at the VC firms that have been trying to raise financing since 2009, it is remarkable how many have not been able to fill up their rounds. Only the top 10% have made money over the past 25 years.

I don’t think its fat or lean anymore. In the early days of the Internet, anything went. We now see some trends that make businesses succeed and investors now look for those trends. Customer traction is that primary trend.

Sramana: The mid 1990’s was a mad renaissance where there was a lot of discontinuity on the networking, software and ecommerce side. Everything was up for grabs and the pace of innovation accelerated. In the past 8 years the pace of innovation has been significant because of the mobile and social trend. Is this pace of innovation going to continue going forward? That is not clear.

Ash Ashutosh: It could be in different domains. It might be in communications. Innovations happen when they get intercepted with the right market.

Sramana: I think education is an exciting field. What we are doing in 1M/1M is exciting. Who will be the big winner? That is unclear but there is a lot of experimentation. I also think the globalization of entrepreneurship is interesting.

Ash Ashutosh: It is very interesting. It may be a different kind. When constraints are removed it creates and ecosystem.

Sramana: There is a bit of normalization happening there as well. Because of 1M/1M I see tremendous activity around the world. There are sizeable companies happening all over. Oregon is producing good companies. We have seen companies from all over. Part of our agenda is to democratize the knowledge. You need to understand how to put one foot in front of the other.

Ash Ashutosh: The knowledge is definitely the foundation. At the end of the day if you are fundamentally constrained then you will not make progress. I have watch several colleagues go back to India and try to put things together. Some of them have succeeded.

Sramana: I have been covering India since 2005 and it has come along slower. I thought it would go faster.

Ash Ashutosh: Starting a business has its own challenges there. This is the most frustrating part in India and Indonesia. There are certain norms that you refuse to do if you are in the US, but it is something you must do there. Those little things become major obstacles. The infrastructure in Bangalore has gotten to the point that it is impossible to sustain growth. The populist agenda there probably does not line up with entrepreneurship.

Sramana: India is exciting. The bottleneck is infrastructure and bureaucracy. Day to day life is difficult. Pollution and traffic are a nightmare. If they resolved that India would be interesting. I wrote Vision India 2020 and my agenda was to expose Indian youth to these types of visions.

Ash Ashutosh: I think India could have a good future if they remove the obstacles for entrepreneurship.

Sramana: This has been an interesting conversation. Thank you for taking the time to share your experiences.

This segment is part 7 in the series : Incubating a Fat Startup at Greylock: Ash Ashutosh, CEO of Actifio
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