# VC10X - How To Win In The AI Era? - Rishi Taparia, Co-founder & GP, Garuda Ventures

An episode of [VC10X - Investing, Venture Capital, Asset Management, Family Office, Wealth Management](https://invisiblenetwork.ai/podcast/1632806986), 16 Sep 2025, 49 min.

Audio: https://anchor.fm/s/a453ddd4/podcast/play/108377013/https%3A%2F%2Fd3ctxlq1ktw2nl.cloudfront.net%2Fstaging%2F2025-8-16%2F407580009-44100-2-1d813719095cd.mp3

Rishi Taparia is a seasoned operator turned investor who brings a unique perspective from his time in the trenches at companies like Poynt and Legion. Now, as the Co-founder of Garuda Ventures, he invests in the next generation of B2B software companies. In this episode, we dive deep into the seismic shifts happening in the world of B2B SaaS, thanks to AI. We'll explore how the rules of software are being rewritten, what a real 'moat' looks like in this new era, and why customer trust might be the most valuable asset a company can have. Rishi shares his 'team, market, product, vision' framework for investing and offers a candid look at the emotional rollercoaster of building a company from the ground up. Links: ⭐ Sponsored by Podcast10x - Podcasting agency for VCs - https://podcast10x.com Garuda Ventures website - https://www.garuda.vc Garuda Ventures newsletter - https://garuda.substack.com/ Brick by Brick podcast - https://www.youtube.com/@brickxbrickpod Rishi Taparia on Linkedin - https://www.linkedin.com/in/rktaparia/ Rishi Taparia on X - https://x.com/taps Taps Notes (Rishi's newsletter) - https://taps.substack.com/ Arpan Punyani on Linkedin - https://www.linkedin.com/in/arpanpunyani/ Arpan's newsletter - https://arpanpunyani.substack.com/ 🎙️ Hosted by Prashant Choubey Follow Prashant on X - https://x.com/ChoubeySahab Follow Prashant on LinkedIn - https://www.linkedin.com/in/choubeysahab We talk about: - Operator-turned-investor journey: From early employee at Point and Legion to founding Garuda Ventures - AI disruption of B2B SaaS: Changing pricing models, margin profiles, and the build vs. buy decision - Trust as the new competitive moat: Customer credibility and brand reputation in the AI era - TMPV investment framework: Team, Market, Product, Vision evaluation criteria for early-stage deals Timestamps: (00:00) Introduction (03:12) Rishi Taparia's background as an operator and investor (07:08) Investment thesis and focus on B2B SaaS (10:22) Impact of AI on B2B software and business models (14:06) Evaluating founding teams in the AI era (17:34) Vertical SaaS and competition from large AI companies (21:24) Changing nature of moats in the AI world (23:33) Discussion on customer trust and retention (26:02) Key factors in evaluating early-stage investments (28:29) Interesting AI application themes (30:16) Evolution of commerce infrastructure (34:01) Building credibility with founders (37:14) Garuda Ventures' podcast "Brick by Brick" (40:41) Managing time and priorities as a VC (43:08) Exciting portfolio companies (45:03) Rapid-fire round about Garuda Ventures' investment approach For sponsorship or guest appearance requests, write to prashantchoubey3@gmail.com Subscribe to VC10X on Youtube, Spotify, Apple Podcasts.

## Transcript

[0:00] If we don't believe we can help you kink the curve on your
[0:03] trajectory and improve the odds of success for you, we're not
[0:06] going to invest here. In this AI era, the more you use
[0:10] the product, the more expensive it becomes to serve that
[0:14] customer from a gross margin perspective.
[0:16] And so margins are also going to be re evaluated and what best in
[0:20] class margin profiles look like for software is going to change
[0:24] as well. This is the same story that's
[0:28] played out in technology over decades, right?
[0:30] 10-15 years ago. It's like, well, what if Google
[0:32] does this? What if Facebook decides to do
[0:35] this? What if Apple decides to do
[0:37] this? And, and now it's what if open
[0:39] AI does this? What if, you know, Anthropic
[0:41] does this? And so on.
[0:43] I think there's going to be room for both that the models we're
[0:46] working on today are the worst models you will ever work on
[0:49] ever. I think trust is a Moat.
[0:52] I think that customer trust and belief in you and understanding
[0:58] of what you do and faith that you will deliver on what you
[1:01] said and not over promise under deliver I think is a is a big
[1:05] Moat. Instead of selling a product
[1:07] that we're making, we're effectively selling money.
[1:12] Hey everyone, this is. Prashant and I'll be your host
[1:14] for the VC the Next podcast. And today, we have Rashida
[1:17] Pariya with us. Rishi is a seasoned operator
[1:20] turned investor who brings a unique perspective from his time
[1:24] in the trenches at companies like Point and Legend.
[1:28] Now, as the cofounder and general partner at Kurda
[1:31] Ventures, he invests in the next generation of BDB SAS startups.
[1:36] In this episode, we dive into the massive shifts happening in
[1:39] the world of BDB SAS thanks to AI.
[1:42] We'll explore how the rules of software are being rewritten,
[1:46] what a real mode looks like in this new era, and why customers
[1:51] trust might be the most valuable asset for a company to have.
[1:56] Rishi shares his team, market, product, vision, framework for
[2:00] investing, and offers a candid look at the emotional role of
[2:03] coaster of building a company from the ground up.
[2:06] So without wasting any time, let's dive straight in.
[2:09] This episode is sponsored by my own podcasting agency called
[2:13] Podcast NX, where I help venture capitalist, asset managers,
[2:16] allocators and family offices and starting their own podcast
[2:20] and building a strong brand. Podcast NX is designed in a way
[2:24] to work well with the busy schedule of investors where we
[2:27] handle every aspect of podcast production so you can focus on
[2:30] investing. If you're looking to build a
[2:33] strong investor brand, starting a podcast should be right up
[2:37] your priority list. It's the only form of marketing
[2:40] where you can showcase your strong network.
[2:42] In other words, access to limited partners and founders
[2:46] and grow that network further. And contrary to what most people
[2:49] hear, it's still very early to start a podcast.
[2:52] There are at least 10X more newsletters and thousand X more
[2:55] blogs than there are podcasts in this world.
[2:59] You can learn more about our podcasting services at Podcast
[3:02] ten-x.com. I'll make sure to add the link
[3:05] in the description below. Enjoy this episode.
[3:08] Hey Rishi, so good to have you on the VC10X podcast.
[3:11] How are you doing? Very well.
[3:12] Thank you for having me, Prashant.
[3:14] Yeah, it's a pleasure having you on.
[3:15] And finally I get to have you on my podcast.
[3:17] So yeah, it's, it's great having you on.
[3:20] Yeah. To start things off, can we
[3:22] first have your operator story and how that experience at
[3:27] companies like Point and Legend help you now as an investor and
[3:31] also helping your portfolio companies also do things better
[3:35] at the earlier stages of the business?
[3:37] Yeah, absolutely. So that I started out my career
[3:41] in technology first as an investor was at Scale Venture
[3:44] Partners, an amazing firm mostly focused on at the time back in
[3:48] 2010 post product market fit enterprise, SAS companies, you
[3:52] know businesses like Box, HubSpot, DocuSign, RingCentral,
[3:56] all which you know I had the chance to partner with and and
[3:59] work on. Then went earlier stage to
[4:01] Matrix Partners. And so now it's early, you know,
[4:04] very early stage companies. At the time, Series A was
[4:06] considered that very early stage.
[4:08] And so these are businesses like Oculus Rift apartment less bug
[4:12] Snag Canva, which I drove the investment for in their seat
[4:16] around back in 2013. And so, you know, I spent four
[4:19] years on the venture side. And while that was an amazing
[4:22] experience for me, I always felt like understanding what it would
[4:27] be like to be on the ground, kind of in the trenches, so to
[4:30] speak. Building companies would help me
[4:34] help founders better if if in fact investing is what I wanted
[4:38] to do when I grew up, so to speak.
[4:40] And so I left Matrix and joined a portfolio company at Matrix
[4:44] called Point. We were building payment
[4:46] terminals, trying to reimagine the dumb Gray brick as a smart
[4:50] connected and a programmable device.
[4:52] I joined as the 7th employee and first business hire.
[4:55] And basically over the next five years, anything that wasn't
[4:58] product or engineering fell into my wheelhouse.
[5:01] And so I got to live that experience first hand of scaling
[5:06] up, you know, HR, sales, marketing, finance, legal,
[5:11] accounting, growing the team across multiple countries,
[5:14] selling customers in multiple geographies.
[5:18] And, and you know, by the time I left five years later, we were
[5:21] serving 130,000 merchants doing about 13 billion in volume on
[5:25] the platform. And that experience proved
[5:28] incredibly informative for me because it helped me realize a
[5:33] few things about myself. One, I love working with early
[5:36] stage founders on early stage problems.
[5:38] And two, that I'm a glutton for punishment because all I want to
[5:41] do for the rest of my career is work with early stage founders
[5:43] on early stage problems. And so after Legion or after
[5:48] point, I went to Legion Company, the workforce management space.
[5:51] Again, similar role, early stage, get on the exact team
[5:54] reporting directly, CEO responsible for kind of a lot of
[5:57] the running of the business and the strategy and, and those two
[6:01] experiences just let me see exactly what the early building
[6:06] looks like. Because at the end of the day,
[6:08] when you're an early team, you have to believe in something
[6:13] that most people can't see. And there's a vision that the
[6:16] founders are laying out and that you're working toward.
[6:19] And so, so much of it is just going from a deck and a dream to
[6:23] building a team, building your product, to getting into revenue
[6:26] and setting the business up for scale.
[6:28] And so after I left Legion and then went back into investing
[6:32] and, and started Guruda and, and went full time with the fund,
[6:37] that's basically the entire genesis of what we're trying to
[6:40] do. Because nobody believes.
[6:43] How can we be that first true believer investor?
[6:45] And given our operating experience, myself at Point and
[6:48] Legion and my Co founder Arpin's eight years that he spent at
[6:51] Okta, how can we take all of that insight, knowledge,
[6:54] learnings and that of the broader guru to community and
[6:57] help founders go from a deck in a dream to build a team,
[7:00] building a product, to getting into revenue and avoid the many,
[7:04] many mistakes that we have made ourselves in our careers?
[7:08] Absolutely. So proper operator investors
[7:11] here, right? That's right.
[7:12] Awesome. That's right.
[7:13] And and you have this particular focus on B to B SAS, right, B to
[7:16] B software. And you've, when you're talking
[7:20] about your investment thesis, you've talked about concepts
[7:22] like intelligent applications or the new parameter, right.
[7:26] So can you give us an insight on some of those?
[7:28] And also, what does your broader investment thesis look like?
[7:33] Yeah, absolutely. Look, ultimately for us where we
[7:36] play is the kind of very first round of financing that a
[7:40] company is going to go raise. We are built to help you from
[7:46] that early stage and getting the foundation laid for your
[7:49] company. Where we invest is largely
[7:52] reflective of our own experiences and the broader
[7:55] networks that we have and our ability to help.
[7:58] Because at the end of the day, when you're investing so early,
[8:02] again, it's the early investors, the founders, the early team,
[8:05] like those are the only people that are actually around and
[8:08] give a hoot about what you're doing.
[8:10] And so for us, we very much believe in delivering value
[8:15] beyond capital because we want the founders to make sure
[8:19] they're getting more than just money, especially in the market
[8:21] where kind of capital is a commodity.
[8:23] And so if we don't believe we can help you kink the curve on
[8:27] your trajectory and improve the odds of success for you, we're
[8:31] not going to invest. It's not right for us to just
[8:33] occupy space as a line on the cap table for you as a founder.
[8:38] And so as a result, as you'd expect, given my background in
[8:42] fintech and kind of in, in kind of enterprise applications,
[8:45] Arpen's experience that it's at in the cybersecurity space, you
[8:49] know, we generally invest across kind of three core themes, one
[8:54] being intelligent applications, you know, business software.
[8:57] How do various businesses, either horizontal or vertical,
[9:01] run their workflows, make their decisions, leverage software to
[9:04] to help run their businesses? We look at kind of commerce
[9:08] enablement, This is Money movement, payments, e-commerce
[9:11] infrastructure and the like, given my background at at point
[9:15] especially. And then we look at kind of
[9:18] modern infrastructure. This is, you know, cybersecurity
[9:22] infrastructure, dev tools and data, which Arpin spends a lot
[9:26] of time on. And these are areas where we
[9:29] have deep insight, expertise, kind of perspectives on the
[9:33] future and the ability to introduce founders to early
[9:38] employees, early design partners, early customers and
[9:41] the like to again help kink the curve on the trajectory of the
[9:46] business and provide value beyond capital.
[9:50] Absolutely. And when it comes to B to B, we
[9:52] are talking at a very interesting time where B to B is
[9:55] going through a certain shift, if I may call it that because of
[9:59] the coming of AI, right? So there are talks about OK,
[10:02] where the companies are just going to build their own
[10:04] software because like coding is going to get so much easier that
[10:07] you can just spin up your own apps that you want and they're
[10:10] more postalized to your use case, right?
[10:12] The other is that is C based pricing still relevant and so
[10:15] many other discussions that are going around this space.
[10:17] So give me an insight into what are your views than that and how
[10:20] do you look at it as an investor?
[10:22] Yeah, absolutely. Look, I think AI is no surprise.
[10:25] It's coming for everything and and certainly going to influence
[10:29] the way that companies build software, what they buy, pricing
[10:34] and all that. I think we're just in the early
[10:36] innings of of this kind of next era of software.
[10:40] But I do think it is just that this next era of software.
[10:43] And so expectations are going to change and the way people
[10:46] interact with technology is going to change, but it is
[10:49] largely intended to, again, give people back time and help
[10:53] accelerate work flows and help people make people more
[10:56] productive. And so while I do think the
[10:59] other rules of software are being rewritten from the ground
[11:02] up, I don't necessarily believe that companies are going to roll
[11:08] their own applications and build all of their own software
[11:11] themselves, even though it's gotten easier only because at
[11:15] the end of the day, when you're running a business, you have to
[11:18] keep the main thing, the main thing.
[11:20] And so and so building expertise and understanding and and a know
[11:26] how on what you're supposed to be best in the world at is going
[11:31] to be even more important because the competition for your
[11:35] customer, for your business is going to grow, go up so much
[11:39] more. And so I think what's instead
[11:41] going to happen is you're going to have the ability to have
[11:45] technology be even more hyper personalized for your use cases.
[11:50] But I do think that a lot of the software is going to just be,
[11:54] you know, it's going to be bought as opposed to built.
[11:57] But the build versus buy decision is going to be a lot
[12:02] more, shall we say, competitive when, when thinking about which,
[12:09] which route we should go because resource management is going to
[12:14] be kind of so much more kind of deeply evaluated.
[12:19] But I think, you know, it's just, it's just the next
[12:21] evolution of software and, and pricing is also going to change
[12:25] when it comes to the way, you know, the, the software's price.
[12:29] Are we doing per seat pricing? Are we doing usage based
[12:32] pricing? Are we doing outcomes based
[12:34] pricing? Is there going to be a base
[12:36] platform fee for your product and then a usage based pricing
[12:39] on top? Like that's all kind of in
[12:41] flight right now, especially given unlike with a, you know,
[12:46] typical SAS software where the incremental kind of seat or the
[12:51] incremental usage is, you know, de minimis marginal cost here in
[12:55] this AI era, the more you use the product, the more expensive
[12:58] it becomes to serve that customer from a gross margin
[13:02] perspective. And so margins are also going to
[13:04] be re evaluated and what best in class margin profiles look like
[13:09] for software is going to change as well.
[13:11] And so a lot of interesting things happening all at once,
[13:15] which is why I think it's a great time to be investing and
[13:19] deploying into this next era. Absolutely.
[13:22] And when things are changing so rapidly and almost evolving so,
[13:28] so fast, it also becomes extremely crucial that not just
[13:32] you as an investor are keeping up to pace with the updates and
[13:37] what's happening, but also your founders or portfolio companies.
[13:41] How are they adapting to new discoveries and new launches
[13:44] that are happening every week by this these big elements as well.
[13:47] And, you know, maybe making their own strategy, tweaking it
[13:52] and adjusting it to now align with the new reality that's much
[13:55] different than what it was maybe a month back, right?
[13:58] So how, how do you evaluate that aspect in founding teams that
[14:01] can this team actually sail through this AI wave that's
[14:04] coming? Yeah, look, for us one of the
[14:08] key things we try to look for is adaptability, right?
[14:12] Because at the end of the day, the technology is going to
[14:16] change, the market's going to change, the customer was going
[14:19] to change the buy, the buying decision is going to change.
[14:22] And so how do you react to change?
[14:24] And are there any, is there any evidence of that in your past
[14:28] where you know you've dealt with some adversity, some challenge,
[14:31] some change that you've adapted to and adjusted for?
[14:35] We also try to engage the founders in conversations about
[14:39] the changing technology. What happens when you know, an
[14:43] open AI or an anthropic model can do this part of the, the
[14:48] business very well? How do you what's your
[14:50] differentiator? How do you sell?
[14:52] How do you think about the go to market motion?
[14:54] What's the value that's being created?
[14:56] And can you as a founder, articulate a vision of the
[14:59] future and the steps along the way that the, the, what kind of
[15:05] market is going to take and which way you're going to
[15:07] navigate the business, given, you know, a, a set of potential
[15:12] probabilistic outcomes that happen in the market.
[15:15] And, and how well thought through are you in your domain,
[15:18] in the ecosystem with the customer and on your, what is
[15:22] your understanding of the buyer and kind of what they think
[15:25] about what they care about? And so, you know, it's, it's all
[15:30] a lot of gut and a lot of unknowns.
[15:32] But if we can get a good sense of that and you've been
[15:36] thoughtful about the approach and have they taken a kind of
[15:39] methodical approach to thinking through the business and you
[15:43] know, it probably makes sense to invest.
[15:44] If you haven't, or if we know more about your market than you
[15:48] do as a founder, then maybe it doesn't make so much sense to
[15:51] invest in. So, you know, that's a we, we
[15:53] definitely try and evaluate that.
[15:55] And then we do things within the portfolio as well, just to help
[15:58] trade insights and knowledge amongst the founders.
[16:01] You know, we, we did a, you know, how do you, how are you
[16:04] using AI within the company session with our founders, We're
[16:08] doing session on, how do you specifically now on sales, what
[16:12] are the best sales technologies that are being utilized by
[16:15] founders leveraging AI to, to accelerate sales, customer
[16:19] success, You know, things like that.
[16:20] Just because trading notes amongst the portfolio is also
[16:25] incredibly helpful because we're learning, they're learning and
[16:27] and we get a chance to have open debates about what's working and
[16:30] what's not. Absolutely.
[16:32] Yeah, there's always been this idea in investing that, OK,
[16:35] we're investing in the team and not the idea.
[16:37] And I think that concept is all the more relevant now with so
[16:40] many changes happening. I think the idea might just look
[16:43] completely different one year from now than what you started
[16:46] with. But if they if you chose the
[16:48] right team, then they're going to navigate that too, right?
[16:50] Totally. Now for us, the, our, our
[16:52] framework is team market, product vision in that order of
[16:55] importance because if you got the right team in the big enough
[16:59] market, then in your division, the product is going to change.
[17:02] But if you've got the wrong team in the right market with the
[17:06] right product, it's still probably not going to work out
[17:08] as big as you thought. And so TMP is the little
[17:12] framework that that we leverage here at Garuda.
[17:15] Right, absolutely and openly. I recently launched Agents and
[17:20] it is also there are talks that it's going to get into vertical
[17:24] spaces, specialized LLMS for different spaces, let's say
[17:27] healthcare or different verticals, right?
[17:30] And there are also vertical SAS startups which are built for
[17:34] specific verticals, right? How do you look at that, that,
[17:37] OK, if these big LLMS are going to start, earlier there was this
[17:42] thing that VCs used to say that, OK, these big LLMS are going to
[17:44] be like generalist and we're going to invest in vertical
[17:48] LLMS. They're going to be more
[17:49] specialized than the big LLMS, right?
[17:51] But now what's seems to be happening is that these big AI
[17:55] companies are also getting into verticals, right?
[17:58] Does that pose a significant risk to small startups because
[18:01] they are also behemoths with lots and lots of funding and
[18:04] they're backing and they can train larger models with much
[18:07] more faster and have more resources in general, right?
[18:10] So how do you look at it as an investor in vertical?
[18:13] SAS, yeah, for sure. Look, I think this is the same
[18:17] story that's played out in technology over decades, right?
[18:19] 10-15 years ago. It's like, well, what if Google
[18:22] does this? What if Facebook decides to do
[18:24] this? What if Apple decides to do
[18:27] this? And and now it's what if open AI
[18:29] does this? What if, you know, anthropic
[18:31] does this? And so on.
[18:32] I think there's going to be room for both and, and the reality is
[18:35] for these big behemoths, you know, LLM providers, the big
[18:39] names that everyone knows, they care about things that will move
[18:44] billions of dollars of revenue over and very, very quickly as A
[18:50] and, and not, you know, smaller than that.
[18:53] It's the same, you know, it's the same thing that, you know,
[18:55] Google could do a lot of things, but if it's not going to to a
[18:59] billion dollars in revenue, it's not going to matter.
[19:01] And so I think open AI, anthropic and the like are all
[19:05] very similar. And so while they are certainly
[19:07] going to get for sure into more verticals, these are going to be
[19:13] big, generic broad verticals like healthcare as a broad as a
[19:18] broad kind of opportunity, but they will not be able to A move
[19:23] as fast B have the kind of insight and the specificity and
[19:29] understanding of the customer. And as a result, I think that
[19:32] still leaves opportunity for smaller companies to go win
[19:36] within verticals. And so you, you can just know
[19:38] your customer better, you can move faster, you can be more
[19:41] tailored to them. And to my earlier comment about
[19:43] more hyper personalized software and and technology that can make
[19:47] and leverage, I think that is an incredibly powerful thing,
[19:52] especially if you're adapting to the customer set more quickly.
[19:55] And so I think that, you know, yes, open AI, Anthropic, they're
[19:59] they're going to build for big kind of masses of the
[20:03] population, you know, developers as a great example of technology
[20:08] where they've basically built the best in class software.
[20:12] And so you have had it like if you're a cursor, for example,
[20:16] that's the real competitor, but you've raised billions of
[20:18] dollars and you're going after. You know, the same customer set
[20:22] as your, your Microsoft, your opening eyes, your Anthropic.
[20:25] I think it's going to be similar to that.
[20:27] Like how can we build in a vertical, but very generically
[20:30] in order to cater to the needs and and attract a lot of people.
[20:33] But the specificity isn't necessarily going to be there.
[20:36] The customized workflow is going to be there and it's going to
[20:40] they're going to rely upon the ecosystem to build those
[20:45] integrations, those capabilities for the end customer.
[20:48] So a long winded way of saying, I think there's room for both.
[20:51] And while it's important to think about where the big
[20:58] players could go, I think more important is how do we satisfy
[21:02] the customer need and where do we believe the technology could
[21:06] be in a year from now, knowing full well that the models we're
[21:09] working on today are the worst models you will ever work on
[21:12] ever. And and so the technology at a
[21:16] baseline level is only going to get better.
[21:18] And So what is that? Is that exciting or is that
[21:21] terrifying for you as a founder? Absolutely.
[21:24] Yeah, that that makes sense. And the modes is something that
[21:28] is again up for discussion because what was previously
[21:32] thought of as a good mode is, is now any longer a good mode, like
[21:36] maybe a technical mode. It's no longer considered a
[21:38] solid mode, a tangible mode, Right?
[21:40] So what do you think is now considered a tangible mode in
[21:45] the AI world? I think trust is a Moat.
[21:49] I think that customer trust and belief in you and understanding
[21:55] of what you do and faith that you will deliver on what you
[21:58] said and not over promise under deliver.
[22:00] I think is it is a big Moat only because at the end of the day,
[22:04] until agents are buying from agents and all software and you
[22:07] know, technology has made everybody autonomous that humans
[22:10] want to buy from humans and they want to.
[22:13] And I think that people want to know that there's somebody on
[22:15] the other side that I can get my problem solved and my question
[22:18] answered. And I think if you've again,
[22:21] position yourself as credible, as reputable with good customers
[22:29] that all rave about you, I think your brand matters more so
[22:33] probably than ever before, which is why you're seeing now so many
[22:37] CE OS and founders turn into creators and brands of their
[22:43] own. I think it's all in the spirit
[22:45] of credibility and and trust. And so that, you know, it's it's
[22:51] you talk to a financial institutions as an example.
[22:54] And very candidly, they will say like, yeah, we're trying all
[22:57] these different AI tools and the like, but at the end of the day,
[22:59] we're probably just going to buy open AI.
[23:01] And the reality is because that's because they're spoken
[23:05] about, they're the, you know, they got the first mover
[23:07] advantage and they've been and Sam Altman and the team have
[23:10] done an amazing job of building that credibility and reputation.
[23:14] And so I think it's more and more the Moat is going to be
[23:17] customer trust and your go to market differentiation and your
[23:21] ability to hone in on what the customer wants, what their
[23:27] problems are and how can you solve that such that they get
[23:31] back more time to do it what they want.
[23:33] Absolutely, Yeah, that's, that's all.
[23:35] And then one more mode that I've observed, especially in India.
[23:39] So perplexity announced that they're going to be free in
[23:41] India, right. So what happened then is that
[23:43] most of the people who were who, who were pro AI users were using
[23:48] chat CBD, right? And what happened then is that
[23:50] they had chat histories or their memory of their charts within
[23:54] chat CBD, right. And now to switch to publicity
[23:58] was difficult because it was starting from scratch and at
[24:01] least up until now, it's not that easy to transfer context
[24:04] between different LLMS, right? So a lot of people kept paying
[24:07] for ChatGPT even though they had a free perplexity account there.
[24:12] And I think even though that's the case for the pro AI users
[24:16] that are already pro users. But I think what perplexity very
[24:20] twins is that a flurry of new AI users are going to come into
[24:24] publicity and the same mode of memory is going to help them
[24:28] retain these customers and convert to paying customers when
[24:32] this free once this free period ends after a year.
[24:35] I think that memory is a mode or maybe context as a mode.
[24:39] That can be a thing if context transferring is not made super
[24:43] easy, which I don't. Look, I think that that is for
[24:46] sure. I'd also think familiarity with
[24:48] a tool, right? And, and not having to change
[24:52] workflows, you know, find how things work and figure out how
[24:55] do I do the thing that I did over here over there, which is
[24:58] why I think you have so many of these companies now and
[25:03] including in our portfolio going after schools, universities,
[25:06] high schools, and can we get people using our tool when
[25:11] they're kids effectively? Because in the same way, you
[25:15] know, I still buy Gillette shaving cream and Colgate
[25:18] toothpaste because that's what I've been using since I was a
[25:21] kid, because that's what my dad used, because that's what hit
[25:23] like that's what happens. And so you know if the, if LTV
[25:27] is truly the lifetime of a user that becomes a very interesting
[25:33] and differentiated monetization strategy for for and and your
[25:39] willingness to acquire that consumer, that consumer early on
[25:42] goes way up for some of these businesses.
[25:45] Absolutely. Yeah, quite interesting.
[25:47] And investing at the early stages, especially in the
[25:50] current market is a very difficult job in a way, right,
[25:53] because there are so many factors to be risk before making
[25:56] the investments, right? So what are the key things that
[25:59] you're looking for right now that when you're evaluating
[26:02] these? Yeah, like it all kind of goes
[26:06] back to that TMP framework, team market, product vision and but I
[26:12] think that kind of the context, context of the team.
[26:15] How did you come together? Why is this problem one that you
[26:19] want to chase after to glass for a decade, get a run through
[26:24] walls for you know what, what is it to you?
[26:28] What why are you doing this? What's your why?
[26:31] What's that secret that you have?
[26:32] What's that insight that you have that the the rest of the
[26:34] market isn't seeing? You know, what is the
[26:37] technological advantage or the why now for this, that means it,
[26:41] you know it hasn't existed before.
[26:43] Is this a new technology solving an old problem?
[26:46] Is this a new technology solving a new problem?
[26:49] You know what, how does that all work and kind of what's your
[26:52] vision for the future and, and, and how we're going to get
[26:55] there. And you know, what is this
[26:57] market is an emerging market? Is it an established market?
[27:00] Is it something that's going to be new that comes?
[27:02] You know, these are all the questions that we ask and debate
[27:04] internally all the time. And at the end of the day, when
[27:08] you're investing, especially at the early stage, most of the
[27:14] time when we're evaluating opportunities, by the time we're
[27:16] getting the second, third meeting, they're all fairly good
[27:21] and they checked a lot of the boxes.
[27:23] And honestly, the hard thing is to say no to something, to an
[27:28] opportunity, into a, to a founding team where you know,
[27:32] you really don't know. But I think the, the lesson that
[27:37] I've learned over, you know, 15 years being in the valley is you
[27:40] don't have to swing at every pitch, so to speak.
[27:43] And so you're allowed to say no and wait until that perfect kind
[27:47] of down the middle strike comes and then swing at that.
[27:51] And so, you know, for us, it's, it's just about being
[27:54] disciplined, being thoughtful, providing a great kind of
[27:58] experience, customer experience, so to speak, for our founders
[28:02] and the founders that that we have the privilege of meeting,
[28:05] but really only deploying when it feels like you're checking
[28:09] all the boxes. And this is a company that you
[28:11] have to back and a founding team that you have to partner with.
[28:15] Absolutely. And within AI applications there
[28:18] are all different types of fate. What do you like the most?
[28:22] Or is there a specific team that you think right now is
[28:25] overlooked or is not hyped enough, but do you think can be
[28:28] a good opportunity? Well, there are a number of
[28:30] them, but admittedly I won't pretend to be smart enough to
[28:35] know exactly where that's all going to shake out At the end of
[28:40] the day, we're founder first, not kind of thematically focused
[28:43] or thesis driven. We have perspectives, but we are
[28:48] not going to try and force those perspectives on to the founders
[28:51] that we meet. We're looking for the founders
[28:53] to tell us where the world is going and then decide whether we
[28:59] believe in that vision for the future.
[29:01] Only because I've seen the mistake being made a lot where
[29:04] an investor has an idea of what's going to happen and how
[29:07] the business should be run. The founder has an idea of
[29:10] what's going to happen the way the business should be run.
[29:11] They both think they're speaking the same language and have the
[29:15] same vision and the same vision and a mission.
[29:18] And then after you invest, you realize, Oh no, we're actually
[29:22] diverging here. And that creates a lot of
[29:24] tension because the investor thinks that he or she is correct
[29:29] and the founder thinks that he or she is correct.
[29:31] At the end of the day, it's the founders company.
[29:34] And so we as investors are in service of our founders, in
[29:38] service of our our LP's. And our job is to serve as
[29:43] advisor fiduciary and offer perspective from the market and
[29:47] from our own experience that that helps inform the decisions.
[29:50] But the founders have to take the decisions.
[29:53] And so, you know, as a result, we don't we, we have a few areas
[29:57] where we're spending time in probably more heavily than
[30:00] others, but we're ready for founders to tell us where the
[30:03] world is going. Absolutely.
[30:05] That's a great approach. How has your view of commerce
[30:09] infrastructure evolved since your early investment into
[30:12] Canva, and what foundational place do you see emerging next?
[30:17] Yeah. Look, I think Canva was a great
[30:20] example of an amazing team with a very thoughtful and laid out
[30:28] vision and articulation of the future and an ability to adapt
[30:33] to changing technology that allowed them to continue to
[30:38] scale. Like mobile was just coming when
[30:40] we invested in Canva in a real way, the iPad had just been
[30:43] announced. Now in this AI era, they've
[30:47] pivoted and, and not added all of this AI now to the core
[30:52] product. And I think from an onboarding
[30:54] to AI perspective, they are amongst the best in the market
[30:57] as far as helping people understand the power of AI and
[31:00] doing so in a friendly and approachable way.
[31:02] And it's just, but they've stuck true to the, the original vision
[31:05] and mission and power of the world to design.
[31:08] And, and so that's they changed the game in terms of and set the
[31:12] bar in terms of what it means to build a great kind of business.
[31:16] And you know, that's one that will, you know, likely go public
[31:19] here in the next few years. You know, in terms of, I think
[31:24] what's changed a lot is I think user expectation has changed and
[31:28] and consumer expectations have changed.
[31:30] And so no longer I think is it acceptable for me to search on a
[31:34] site and look for kind of black pants.
[31:37] And the site knows that I'm, you know, 32 waist and a 34 in the
[31:44] scene and shows me products that now don't have the size in
[31:50] stock. Like, you know this, like if
[31:52] you're still doing that, that doesn't make any sense.
[31:55] Why do I have to tell you my full address and my city and my
[31:59] state and my country and then my zip code?
[32:00] Like, like it shouldn't have it. And so I think we're getting
[32:04] into a web that it's much more personalized, much more tailored
[32:07] to you. And as a result, the products
[32:11] that you're seeing and the price points that you're looking for
[32:17] and all that I think are going to the, the consumer demand is
[32:21] going to insist upon seeing better experiences that are more
[32:27] for me than for the general purpose user.
[32:30] And, and so I think that's where commerce is changing a lot and
[32:33] the way you interact with your consumer is changing a lot.
[32:36] And how you have then the infrastructure required to power
[32:39] all of that is, is as a result needing to get upgraded in order
[32:45] to deliver value and convert a customer in a much more hyper
[32:51] competitive set of products. You know, you look, you're
[32:54] looking for Lululemon pants, you're going to get targeted 7
[32:58] different ways from different companies that are all building
[33:02] better quality, lower cost, you know, better durability, you
[33:07] know, sustainably produced. And so we're all trying to build
[33:11] these profiles of of the user that exists in the shadows that
[33:16] will hopefully help drive a conversion.
[33:18] And I think it's going to get even more competitive.
[33:20] And so as a result, you have to be even more personalized.
[33:22] Absolutely. Yeah, that absolutely hitting
[33:25] the nail on the head that the web is going to get a lot more
[33:27] personalized than what it is today.
[33:29] And I think businesses need to build while keeping that in mind
[33:32] that we need to cater to post life needs now, not just
[33:35] generalized needs, right? And how do you understand the
[33:37] post life needs is what you need to work on, right?
[33:41] So something you talk about a lot is that there we try to be
[33:44] first call for our founders, right?
[33:46] How do you, how do you build that credibility among your
[33:49] founders? Because obviously founders have
[33:51] a bunch of different advisors, different investors who all
[33:54] claim to be good advisors, right?
[33:55] Or want to give advice. So how do you get to be that
[33:59] first call investor for your founders?
[34:03] Absolutely. Look, it's ultimately it's all
[34:05] about trust. And I think trust is established
[34:09] in a number of different ways and over time.
[34:11] But I think for us it's all about show, don't tell.
[34:17] And so we say we're going to deliver value to you by way of
[34:24] introductions, by way of sharing knowledge, by way of, you know,
[34:29] customer connections and the like.
[34:32] We better show up and do those things and then document those
[34:37] things for you so you remember. And so every quarter, every
[34:40] quarter at the end of every quarter, each of our founder
[34:43] teams gets an e-mail from us saying this was kind of this is
[34:46] the support and review. What else can we be doing to
[34:49] help you achieve your goals? Where else can we, where is
[34:52] where else should we be leaned in and and spending more time so
[34:56] we can help drive value for the business.
[35:00] I think it also comes from an empathy for the journey and an
[35:06] understanding that in some cases founders want answers.
[35:10] In some cases, founders just want an ear to listen to 1/2
[35:14] baked idea. In some cases, founders want to
[35:17] help making a decision and and want us to kind of guide them
[35:23] there. And so I think having an
[35:25] understanding of the situation and what's going on and being
[35:29] able to bring perspective and not, I think Badger founders,
[35:34] not Hammer founders, not berate founders when things go wrong,
[35:39] also helps build that trust. And for us, that just comes from
[35:43] an understanding, having been there and done that, of the ups
[35:46] and downs of building a company. At the end of the day, it's an
[35:50] emotional roller coaster where you can be high, super high up,
[35:54] you know, customer just signed, you just closed the candidate.
[35:56] This is amazing. And then literally the next
[35:59] hour, it's like, oh, our VPN just leaving because Meta is
[36:03] giving, giving him a great offer and he can't turn it down.
[36:05] And now also, what are we going to do?
[36:06] And like, and like, we've ridden these waves ourselves.
[36:09] And so we understand what it's like.
[36:11] And for us, if we can help kind of modulate that emotional
[36:15] roller coaster and keep founders from getting too high on their
[36:18] own supply, but also not getting too sucked into the vortex and,
[36:22] you know, steal them and for for what's to come.
[36:26] And allow them then help them, you know, demonstrate the best
[36:30] version of themselves to their employees, to their customers,
[36:32] to their investors. Then we've done our job.
[36:35] And, and I again, I think that comes from, from building trust,
[36:40] which starts from genuinely caring about them.
[36:44] And that's, and that's, and then delivering on what you say you
[36:47] would. And and that's what we try to do
[36:48] on a daily basis. Absolutely.
[36:51] Our founders are firefighting 24/7, right?
[36:54] 100%. Yeah.
[36:57] And Gardo Ventures also happens to have its own podcast, which
[37:01] is called Brick by Brick, right? What's the central message that
[37:05] you are trying to drive through this platform?
[37:08] And also, how does that reflect the kind of firm you're trying
[37:11] to build at Gardo Ventures? Yeah.
[37:14] Look, I thought behind the podcast to begin with was as
[37:18] early employees ourselves, we know there's so many great
[37:22] stories and lessons that come from some of the early stories
[37:25] of company building. Whether you're an early
[37:27] employee, you can be a founder, you can be an investor.
[37:29] And so how do we, you know, share some of these stories that
[37:32] are not necessarily covered in the tech press or not
[37:36] necessarily as widely known, but have good lessons that all come
[37:42] back to the same themes. Grit, scrappiness,
[37:44] determination, you know, the power of a team that could
[37:49] inform for, for a listener, some of the decisions they're
[37:54] thinking through and share the fact that you're not alone.
[37:58] Every, every company, no matter how big or how small, has gone
[38:01] through some of the same things. And so this their shared wisdom
[38:05] in that. And so that was the genesis of
[38:06] the pod for us because company, great companies are built brick
[38:11] by brick. And, you know, all of this, you
[38:14] know, the hyper and overnight successes really is not
[38:18] overnight. It's it's, you know, a bunch of
[38:20] work and a bunch of late nights and a bunch of years in a lot of
[38:24] cases that led to the overnight success happening.
[38:27] And so how can we share some of those experiences and stories
[38:31] with, with the the audience and, and you know, build hopefully a
[38:38] a listener base of founders, early employees and people who
[38:44] who the stories resonate with. Absolutely, yeah.
[38:48] And the thing I love about your podcast in particular is that
[38:51] you bring on some people who have been early employees at
[38:55] those companies, right? So what happens is when a
[38:57] company becomes successful, gets Unicorn status and so on, or IP
[39:01] OS, the founders often become the poster boys, right.
[39:04] And of course, the early employees who actually played
[39:07] almost as crucial a role did all nighters along with the
[39:10] founders. They don't get the same on
[39:13] Spotlight. So you have had some of those
[39:15] guests on the podcast. So that's a good thing.
[39:17] And they have a unique perspective.
[39:19] Yeah. 100% Look, I think the early employees are the unsung
[39:22] heroes of startup, the startup ecosystem in general, because
[39:26] you're taking on not all, but certainly a lot of early risk.
[39:32] Your upside is not going to be nearly as large as that of the
[39:36] founders. But without the early employees,
[39:39] there's no company. But you do it for love of the
[39:42] game, you do it for autonomy, you do it for more control, you
[39:45] do it to follow. Whatever your reason, you're,
[39:49] you're doing it knowing the risks or hopefully knowing the
[39:54] risks and the calculus almost never makes sense, but but you
[40:00] do it anyway. And, and so I think as a result,
[40:03] you know, how do we give early employees their flowers as well,
[40:05] so to speak and, and share some of those, their stories and put
[40:09] them in the spotlight too. Absolutely.
[40:11] Great work there and talking about the rapid advancements in
[40:15] the AI world and as investors as as VC in particular, you have so
[40:20] many roles to play. You're also looking at new deal
[40:22] flow coming in, evaluating that you're also fundraising for the
[40:25] new fund and, and so many developments happening in the EI
[40:28] world, which are going to directly impact how you make
[40:30] those investment agents, right? So how do you keep up with all
[40:33] these different things happening at the same time?
[40:35] Give me an insight on how do you manage time and appropriately
[40:39] allocate time to all these different things.
[40:41] Oh man, if I had the answer, I would share it.
[40:45] Honestly, it's a work in progress.
[40:46] I think there's not enough time in the day to do all of it.
[40:49] And so it's just, you know, how do you ruthlessly prioritize the
[40:52] things that matter for you and for the business you like?
[40:56] At the end of the day, a venture firm is a business, right?
[40:59] We, we have a budget, we have our goals, we have OK Rs that we
[41:03] want to meet. They just, instead of selling a
[41:05] product that we're making, we're effectively selling money.
[41:09] And so it's how do we how do we do that successfully and
[41:12] authentically and deliver value to all the constituents that are
[41:16] part of this community that we that we need to pay attention to
[41:20] and, and need to continue that kind of harness and, and
[41:23] cultivate. And so, yeah, we, we generally
[41:27] as a, you know, small team of two are constantly, you know,
[41:31] talking to one another, Arpan and I and, and try to block our
[41:35] weeks off such that we are making sure we're taking care of
[41:37] the operational aspects of the fund and the firm building.
[41:41] We're giving ourselves space to do new meetings, meet new
[41:45] people, allow serendipity to hit.
[41:46] We're giving our space. There's some space to read and
[41:49] research and engage in conversations and then just
[41:52] constantly sharing back and forth.
[41:53] But it's by no means a kind of scientific approach that that
[41:58] we've nailed or anything like that yet.
[42:01] Hopefully more AI comes and helps with a lot of the blocking
[42:06] and tackling of the managing the firm and the fund that we're
[42:10] doing a little bit manually now. And so I'm excited for that.
[42:14] But you know, how do we just get leverage on time to basically do
[42:20] the things that we're uniquely qualified to do and, and, and
[42:24] off offload some of the tasks that are more commonplace?
[42:28] And, you know, we're supported by an amazing, we've got a
[42:31] couple of executive assistants as well.
[42:35] We've got an amazing team that supports us at our fund admin,
[42:38] at our legal team or banking team.
[42:41] And so it's certainly not, you know, not just the two of us,
[42:45] but but how do we continue to get scale and leverage as we
[42:49] grow is is something we talk about constantly.
[42:52] Absolutely. Thanks for giving an insight
[42:55] into the hectic schedule that you have to manage to right.
[42:59] Last question before we move to the rapid firearm, this says
[43:02] what are some exciting portfolio companies that your bag that you
[43:06] would like to mention on the podcast?
[43:09] Asking me to choose between my children.
[43:11] Look there, I think that there's a bunch of great companies that
[43:15] we've had the good fortune to partner with.
[43:17] A couple I'll call out. You know, Flex Point is in the
[43:21] MSP space building basically the financial operations stack for
[43:27] MSPs, both with payments and, you know, understanding accounts
[43:32] payable, accounts receivable, They're off to the races.
[43:35] They just raise their Series A, an amazing, amazing execution
[43:41] driven by that team. I'll call out Archive Intel in
[43:46] financial services space doing compliance and archiving,
[43:50] leveraging AI for financial services companies, helping them
[43:54] more easily communicate with their clients and giving their
[43:57] chief compliance officers more ability to leverage AI to do
[44:03] things like comply with SEC orders and and requests for
[44:08] information. You know, Arcade is building the
[44:13] authentication layer for AI agents help making sure that
[44:17] agents have their appropriate access to the right tooling,
[44:21] right context payments and the like through their platform.
[44:27] Alex Salazar and team over there.
[44:30] You look at a company like Crossville that's helping
[44:33] e-commerce brands show up higher in AI search results with the
[44:39] kind of Gen. AISEO, so to speak and and
[44:43] seeing good traction. So I mean the list goes on and
[44:45] on, but those are a couple of in the portfolio that that we're
[44:50] we're excited about and and certainly that are doing great
[44:52] work. Absolutely.
[44:54] Thanks for sharing those. Now to a rapid fire down wherein
[44:57] I'll ask you 6 quick questions about the investing you're doing
[45:01] and you have to give 6 quick answers.
[45:03] All right, done. So the first one is what are the
[45:06] sectors and regions you invest in?
[45:09] We are B to B focused and so if there's a business buyer with a
[45:12] budget and a problem, you know fits into our scope usually
[45:16] investing in North America in mostly most of our companies
[45:20] historically have been in the US We've got a couple of portfolio
[45:23] companies in Canada. We've also got founding team in
[45:26] Israel, founding team in Australia and a founding team in
[45:30] the UK. Awesome.
[45:32] What's the typical stage of investment?
[45:35] Precede as early as a decadent dream.
[45:38] We are typically going to be investing in the very first
[45:41] round of financing that a company raises and usually for
[45:45] us investing between half a million to $1,000,000 and maybe
[45:48] up to 1,000,000 1/2. And and helping lead Co lead
[45:52] that round, catalyzing the finance, the kind of financing
[45:55] round. And in some cases even, you
[45:57] know, catalyze the formation of the company when we meet founder
[46:01] super early and with just an idea and not even having formed
[46:05] the business yet. Got it.
[46:07] Do you lead rounds? Yes, we lead, Co lead will also
[46:12] follow. So kind of we're pretty flexible
[46:14] there. At the precede stage in the
[46:17] portfolio, we've LED it's about 70% of the time and our letter
[46:23] Co LED 70% of the. Time.
[46:25] Awesome. What's the typical check size
[46:27] you put in? I think you mentioned that
[46:29] already. Yeah, between half a million to
[46:31] 1,000,000 is typical flex up to 1,000,000, 1/2 to 2 million
[46:36] depending upon the situation. Got it.
[46:39] Where can founders get in touch in case there's a directory?
[46:43] Our website you can also e-mail partners at gruta dot VC and
[46:49] that hits both of our devices. Awesome, where can I listeners
[46:53] follow you? We've got very active on
[46:57] LinkedIn and so follow Gurda Ventures as well as myself,
[47:01] Rishi Taparia and my Co founder Arpin Punyani.
[47:04] We also have our newsletters and so it's both on sub stack minus
[47:09] taps TAP s.substack.com. Arpin's is Arpin
[47:13] punyani.substack.com. We've also got our newsletter
[47:16] from Guruda guruda.subsec.com, the Brick by Brick podcast.
[47:21] I encourage you to subscribe and get great conversations with
[47:26] early employees, with founders, with investors coming straight
[47:29] to your to wherever you listen to podcasts and and then also on
[47:34] X through our own personal accounts, Taps, Arpan Punani and
[47:40] then at Guruda VC. Absolutely.
[47:42] Yeah, that's sweet little X handle there, right?
[47:46] Is there a story behind that? Mine so my my last name is
[47:51] Taparia. My friends call me Taps.
[47:54] I was arcade Taparia on X for our Twitter for a long time.
[47:59] Saw that Taps was available and so I just switched and and it's
[48:04] been that way ever since. Very good.
[48:07] Very good. TAPS is actually the acronym of
[48:10] the school I went to, Army Public, The Army Public School.
[48:14] Yeah, That's nice. That's called TAPS, Yeah.
[48:17] So that's funny. Awesome, great having you on
[48:20] Rishi on the podcast. Finally we did this and excited
[48:23] to get this out and I wish you happy investing.
[48:26] Thank you so much, Rishabh. Great to chat today.
[48:28] Likewise, Thank you.

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