1Mby1M Virtual Accelerator Investor Forum: With Suman Talukdar, Founder and Managing Partner at AiSprouts.VC (Part 2)

Sramana Mitra: I love this kind of multicultural perspective. As you know, we are a global accelerator, so we work with entrepreneurs all around the world. When you started talking about AiSprouts, you said that you wanted some product validation.

Talk to us about what you mean by that. In that context, you also said that you developed some thesis on what makes a breakout company. Talk about what that thesis is and how you see the beginning of that in an early validation process. 

Suman Talukdar: Every investor has their theses of what they think is going to work. I found product traction to be the key element. All of the companies that have done well have that as a characteristic. Early revenues are a signal of that, but sometimes revenues follow great usage.

I look for products that the customers love. There are usually some clear metrics around that. As a second step, revenues. It’s simple. That’s the starting point of any discussion. 

Sramana Mitra: You are willing to write checks without revenue, but you want to be able to talk to customers and see their interest in the product?

Suman Talukdar: Yes. A lot of people say that revenue is the key point to know that there is a product-market fit. I mostly agree with that. Sometimes it can hide a lot of things in the product. Great usage and understanding of the exact use case of how the product is fitting the need is a good way to know if this thing is working.

It could be at the cusp of you seeing the revenue from the first customers or getting repeatable revenue in a short amount of time.

Sramana Mitra: Talk about sectors. What sector do you want to apply your AI prowess to? Is it B2B, B2C, enterprise, or small business?

Suman Talukdar: We are doing AI and we are in this big bang period for what I call practical AI. People are saying SaaS is eating the world. My perspective now is AI is going to be gradually eating SaaS. From that perspective, I’m very open to anything. My background is in B2B, so I have a preference and a better understanding of companies that have the B2B SaaS model.

I’m open to user-based products or maybe even consumer-based products. I’m pretty agnostic. The space is wide open so you are going to see experimentation from a lot of entrepreneurs. If I have this product traction-based lens, the best thing I can do is to be agnostic and be open to what I am seeing. 

Sramana Mitra: What about geography? Are you only interested in Silicon Valley companies or broader?

Suman Talukdar: The goal of the fund and my goal as an investor is to back and invest in the best 100 AI companies that are going to have a strong presence in Silicon Valley.

The first step in that fund is to focus on companies that are here. It’s a single GP, so I can’t spread myself out too thin. I’m leveraging my network here to find these opportunities. What I can see happening over time is that it will naturally expand to companies where Silicon Valley is a strong strategic presence for them.

Companies are starting everywhere, so I don’t think being limited is something that you want to do in the long run. What I have learned living in Silicon Valley for many years is that there is a culture that is spreading, but it’s achieved critical mass for a very long time. Companies that have a presence here or have some strong on-the-ground connection benefit from that. 

This segment is part 2 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Suman Talukdar, Founder and Managing Partner at AiSprouts.VC
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