1Mby1M Virtual Accelerator Investor Forum: With Venktesh Shukla, General Partner at Monta Vista Capital (Part 5)

Sramana Mitra: Talk a little bit about the unicorns in your portfolio.

Venktesh Shukla: Let’s talk about three different categories I mentioned that we invest in. We have a unicorn or soon-to-be unicorns in all those three things. We are invested in a cloud infrastructure company called Aviatrix.

The CEO is Steve Mullaney. He’d sold his previous company to VMWare for $1.2 billion with zero revenue. This company has revenue. They do hybrid cloud networking infrastructure. I think by the next round of funding, they will be a unicorn. That’s one.

The second category is enterprise software. One of the companies we’ve invested in is Tekion started by Jay Vijayan. He has a cloud-based CRM for car dealerships worldwide. He just raised $120 million at a $1.2 billion valuation six months ago.

The third category is using technology to disrupt very traditional industries. One company is a bra company called ThirdLove. One of the reasons Victoria’s Secret is in bankruptcy is because of them. When somebody walks into Victoria’s Secret showroom and picks up her undergarments and walks out, Victoria’s Secret knows nothing about that person.

In the process of selecting an undergarment, they’re collecting 30 data points. They have this data on 16 million Americans. So 480 million data points versus none. The advantage they have is similar to the advantage that Google has over other companies.

Sramana Mitra: You said you’re only doing B2B. This is an exception.

Venktesh Shukla: This is the only exception in the first fund. We realized that these kinds of disruptions are available in B2B as well. The value that we bring to B2C companies is very little. We decided not to invest in B2C after that.

Sramana Mitra: One trend that we are seeing in the B2B SaaS category is that companies start with two-sided SaaS and then evolve into a SaaS-enabled marketplace. This is something that you would find interesting.

I’ve seen quite a few companies in that. I find it very interesting and a very intelligent way to approach marketplaces. Is there a SaaS company in your portfolio that will, with time, be a perfect PaaS play?

Venktesh Shukla: There is a company called Fortella. They’re a SaaS company right now. The CMO looks at marketing activities in terms of revenue. Right now, marketing organizes lead-based kind of thing. They do trade shows. Nothing tells them the answer if the CEO says, “We need to do $25 million more with an oil & gas company in the southwest in Q4.”

There are no tools for that today. That’s their core offering today. In the process, they have to have a big data platform that takes all the different tools to get data. All these 20 to 30 marketing tools need to get their data from one of these underlying records. Why not spare the companies from all that one by one kind of negotiation and instead just have a platform play.

Sramana Mitra: How far along is this company?

Venktesh Shukla: They are still young. They still have not raised Series A. They have about 10 to 12 customers including some big ones like Nokia, BMC, and Tipco. 

Sramana Mitra: It sounds like it’s a large enterprise sale.

Venktesh Shukla: Yes.

Sramana Mitra: It’s a million dollar per customer revenue?

Venktesh Shukla: Not really. The entry footprint is very small. It is somewhere between $50,000 and $100,000. 

Sramana Mitra: Thank you for your time.

This segment is part 5 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Venktesh Shukla, General Partner at Monta Vista Capital
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