He had paying customers before he even incorporated—then hit $1M ARR in a year and raised a $19M Series A. | Rahul Shivkumar, Co-Founder of Assured

00:06:20 · Pablo Srugo, Rahul ShivkumarPlay from here

[00:06:20] S0: What kind of an exit was this by the way? Like a big, big success exit? Kind of like things didn't work out? So tuck in, somewhere in between? [00:06:26] S1: Somewhere in between. I think our investors were happy. I think we were happy. I think it was a very hard business to scale and we could probably spend an entire episode talking about should be venture scale and what sorts of business should not be venture scale. Right? And I think our previous business probably fell in the sole category of maybe not a venture scale like setup even, let alone like outcome, obviously. But we were insiders. We had seen the problem before and actually before we even incorporated the business, we had revenue. You know, we had like committed revenue where customers are like, hey, if you help us solve this problem, like we'll sign like an LOI, we'll sign a contract right now. So going into March of 2024, I think there were maybe two customers that had already committed to like using us when the product went live. Yeah.

00:06:26 · Rahul Shivkumar, Pablo SrugoPlay from here

[00:06:26] S1: Somewhere in between. I think our investors were happy. I think we were happy. I think it was a very hard business to scale and we could probably spend an entire episode talking about should be venture scale and what sorts of business should not be venture scale. Right? And I think our previous business probably fell in the sole category of maybe not a venture scale like setup even, let alone like outcome, obviously. But we were insiders. We had seen the problem before and actually before we even incorporated the business, we had revenue. You know, we had like committed revenue where customers are like, hey, if you help us solve this problem, like we'll sign like an LOI, we'll sign a contract right now. So going into March of 2024, I think there were maybe two customers that had already committed to like using us when the product went live. Yeah. [00:07:11] S0: You started Assured with the same co-founder as the company before? Yeah. And so timeline's interesting here. Like you start the last company 2021 where like COVID remote work, you know, so telehealth, right? That's like probably the big thing. And as you're doing it, ChatGPT comes out kind of, I guess, in the tail end, right? So end of 22 and you kind of sold it in 23. Did that, by the way, I'm curious, like that drive at all, the exit, you obviously weren't running an AI native, company. Was that part of the math? How did that play into that and then what you decided to do later?

00:07:11 · Pablo Srugo, Rahul ShivkumarPlay from here

[00:07:11] S0: You started Assured with the same co-founder as the company before? Yeah. And so timeline's interesting here. Like you start the last company 2021 where like COVID remote work, you know, so telehealth, right? That's like probably the big thing. And as you're doing it, ChatGPT comes out kind of, I guess, in the tail end, right? So end of 22 and you kind of sold it in 23. Did that, by the way, I'm curious, like that drive at all, the exit, you obviously weren't running an AI native, company. Was that part of the math? How did that play into that and then what you decided to do later? [00:07:39] S1: Yeah. I think a big part of the narrative of starting Dawn was this kind of shift from needing care in a clinic to being able to not just get like continuous care, but even diagnosis and things like that over telehealth, right? That was what happened in 2020 through 2021. What we started seeing in 2023 was actually people wanting to get back to in-person care. You know, they're like, hey, I've done this virtual thing. We want to actually see our provider in person. We want diagnosis in person. We want treatment in person. So I think there was a little bit of headwinds there. The classic public market example of that is Teladoc. If you look at their stock, the pop in 2020, 2021, and then the kind of fall in 23, I think was probably the best signal for what was happening in that market. AI wasn't a huge reason either way for us like exiting or continuing our business. I think it was very nascent in 2023. GPT3 had just come out.

00:07:39 · Rahul Shivkumar, Pablo SrugoPlay from here

[00:07:39] S1: Yeah. I think a big part of the narrative of starting Dawn was this kind of shift from needing care in a clinic to being able to not just get like continuous care, but even diagnosis and things like that over telehealth, right? That was what happened in 2020 through 2021. What we started seeing in 2023 was actually people wanting to get back to in-person care. You know, they're like, hey, I've done this virtual thing. We want to actually see our provider in person. We want diagnosis in person. We want treatment in person. So I think there was a little bit of headwinds there. The classic public market example of that is Teladoc. If you look at their stock, the pop in 2020, 2021, and then the kind of fall in 23, I think was probably the best signal for what was happening in that market. AI wasn't a huge reason either way for us like exiting or continuing our business. I think it was very nascent in 2023. GPT3 had just come out. [00:08:33] S0: Yeah, we were all scared that AI was going to take over. I guess some people still are, but yeah, that was a big thing back then, right? [00:08:38] S1: I think like it was able to do like summarization well. It was able to generate text somewhat well, but it was like fairly obvious that like something was AI generated and something wasn't, which I don't know if that's true anymore with these newer... [00:08:50] S0: Getting less and less true, man. Opus 5.5 is pretty crazy.

00:08:50 · Pablo Srugo, Rahul ShivkumarPlay from here

[00:08:50] S0: Getting less and less true, man. Opus 5.5 is pretty crazy. [00:08:53] S1: Oh man, it's getting less and less true for sure. So I think the thesis of Assured was actually built around GPT-3, which was like, hey, if you believe that the next version that's going to come out is going to be a step function from what GPT-2 to 3 was, all of a sudden, the old school like robotic processing automation and some of these other browser automation tools that were built, like it was like pretty obvious that they were going to be far in the past, right? Like the new capabilities were going to be significantly better. So the bet on Assured was, hey, where we had people doing things, you're actually going to have models that can reason, think like a human being and then actually be able to complete tasks end-to-end, right? Without needing a human in the loop or an engineering team to constantly kind of like tweak things, which is what the UiPath and the RPAs and all of those were in the past, yeah. [00:09:44] S0: You sold it in 23, like early 23, mid-23, when was it? [00:09:46] S1: We were mid-23. [00:09:48] S0: And did you have to stay there for an amount of time working after you sold it and you kind of moved on? [00:09:52] S1: We were there for a little bit, mostly through like a transition period, but our plan wasn't to stay on it, yeah.

00:09:52 · Rahul Shivkumar, Pablo SrugoPlay from here

[00:09:52] S1: We were there for a little bit, mostly through like a transition period, but our plan wasn't to stay on it, yeah. [00:09:58] S0: So what I want to go a bit deeper on is like once you kind of do that transition, whatever, now it's like second half, late 2023, were you like already preset, we're going to obviously start something new just no matter what? Did you guys start thinking, like how did that, how did you get from there to, okay, we're launching a short in March 24?