Nansi Mishra 0:58

Hi, Srividhya. Hi, Baskar. Welcome to the NEON show.

Srividhya Srinivasan 1:01

Hi.

Nansi Mishra 1:02

I’m so excited to be talking to you both today. And I’m just so amazed and so proud of the journey you guys have lived in the last many years. You guys are building a global streaming infrastructure company. 73 % of the revenue comes from US, 20 % of the revenue comes from Europe and recently in January, listed the company at 825 million dollars. What an amazing milestone. And truly a classic example of starting a company in India and building for the world. And it all started with three friends in college in Coimbatore who decided to build a company, that too for the next 30 years. And it should start in India. So like, why all these three things were so important for you guys when even the product was not there?

Baskar Subramanian 1:55

So, maybe there’s two parts here. So, if you look at it, when we got out of college, we were fairly clear that we wanted to start. So, and Srini, Vidhya and myself said, okay, let’s go. We were like 24, didn’t have anything to really lose, if you will. So, we said, let’s go just try something. We didn’t have a product. We didn’t do anything about it. So, when we started, it was more of an unconscious. The first company that we did, which was called Impulse Soft, was an unconscious venture. What I mean by unconscious, I don’t think we were thinking about, we were just young folks trying to do something together. Came together and said, let’s go do it. We didn’t think about the future. We didn’t think about what’s going to happen and all of that. And obviously, five years later, we sold the company. And I think so, we didn’t know why we were building it. We didn’t know why we sold it. To some extent, it was by at 29, we had actually exited our first exit that’s happened. And we’re trying to figure out what we want to do in life, literally. At that point in time, we started becoming more conscious about, we’re going to do a second venture. Then we needed for legacy and longevity and wanting to build something much more mindful. So, that’s the reason at that point in time, we stopped and said, we will actually first understand where we want to go as individuals, as well as from building institutions rather than trying to look at what’s the business plan, what’s the idea. Those are all coming next. But the value system and the reason why we’re doing this has to be fairly clear. That’s where started this whole thought process came in.

Srividhya Srinivasan 3:20

So, basically, when we started working in TI, and after having understanding of how software is being built, you know, how can you contribute? What can you do? Soon, we understood that we can do products for the world. That was very clear to us. After a couple of years in TI, we call it STI. So, I think after about two, three years, he came and asked saying that, hey, it’s my dream to build a new company. And you know, I want to start something here. I want to be an entrepreneur. Do you guys want to join me? So, we said that, why not? Definitely, let’s do something. So, the whole thing was about trying out new things. So, while it from the external point of view, you feel that they’ve left a cushy job, the way in which at least I convinced my father was, what big deal, if this doesn’t work, you can always go back. So, but let’s try. So, that’s how we started.

Nansi Mishra 4:07

And then you both were already dating when the first company was started?

Baskar Subramanian 4:10

No, we were not actually. I think we were good friends in college. So, I don’t think we ever had any sort of relationships. Literally, we were like friends. I think once he came to Bangalore, then we thought we’re starting together. And actually, we got married after our first startup founded. So, it was not a…

Srividhya Srinivasan 4:28

This was also Baskar ‘s idea?

Srividhya Srinivasan 4:30

This was both of our ideas. Who proposed to you? So, in fact, someone else also asked me who proposed first. In fact, I didn’t know.

Nansi Mishra 4:36

So, the marriage happened after the acquisition?

Srividhya Srinivasan 4:42

No, 2001, we got married.

Baskar Subramanian 4:44

In the midst of the journey of where we started actually.

Nansi Mishra 4:46

And then tell me one more story. I was reading about it that when you guys sold the first company Impulse Soft, and when you were brainstorming about the idea, and you were sitting in the park and the palmist came. What was that story? It will be very interesting for the audience.

Baskar Subramanian 5:04

Essentially, in 2008, we were like, we had quit the company which we sold and then we are coming out of the company which acquired us. There’s a company called Surf, which acquired us. And Vidhya was pregnant with our second son. And we were kind of starting to debate what’s the next one we want to do. And we didn’t have a space to go. We didn’t have an office to go. So, we used to sit in the JP Nagar. There is a mini forest park. So, we used to go there in the morning, sit there in a bench there and spend half a day debating what’s the next thing to do. That was a real routine in some sense. I remember on a Monday morning, we were sitting together, three of us. Again, we are like heated debates about why we should do things. And obviously, all of us have strong ideas in life. So, we kind of discussing and debating. And to a point where we were discussing about targeted advertising. We were thinking targeting is going to be important and we were kind of debating. And at that point in time, a small young boy walked up. And he was like starting to stop us saying, I thought he thought we were fighting with each other to stop us. But to some extent, he stopped and I said, what do you need? And he said, no, I’m actually a palmist and I can actually tell you a future. We’re really debating something interesting. So, don’t worry. We don’t need it. Thank you. Then I start, think about that. That boy, he understood that if you are at 11 a.m. on a Monday morning, sitting in a park, three young people, literally are jobless. That means you better know your future. So, your future is completely uncertain. That’s the reason you are in a park at this point in time. He’s targeting us very well. So, he knew that you need your future. So, that was the kind of…

Nansi Mishra 6:40

You got the validation in the park.

Baskar Subramanian 6:42

So, I was telling them, see, here is how targeting works of a person.

Nansi Mishra 6:45

How much time did you guys take after the company got acquired and before XX?

Baskar Subramanian 6:50

We had a two-year deal with them. Couple of years we spent with them and pretty much after that, we left.

Srividhya Srinivasan 6:55

So, after the transition, we left and then we started debating what to do, right? And then we started Amagi.

Nansi Mishra 7:03

There was always this clarity that you guys would start the company together.

Srividhya Srinivasan 7:08

Yeah, yeah. We told them upfront when they acquired.

Baskar Subramanian 7:11

No, three of us also were always like feeling that, I think we need to do together. Always we’ve been like, that’s something of a almost unwritten rule, at least three of us had that, whatever we do.

Nansi Mishra 7:21

And how would you divide the roles and responsibilities? Because I remember Vidhya talking about it in one of the interviews that initially there were no roles, designations in the company.

Srividhya Srinivasan 7:32

In Amagi, we had no roles, designations for everyone, basically. It will only tell, role was there, designation won’t be there. It’ll never say VP or anything like that, including the founders. It’ll, in fact, my role was basically, I’m an engineer. I love to solve problems. That’s all I had written. So, yeah. So, between the three of us, he’s the dreamer. He dreams and he comes up with an idea. And for him, once the idea is appeared to him and he kind of does all the mental thing and for him it feels like done. For me, I have to realize the dream. Then it feels good. And for Srini, it requires, you know, numerical analysis has to be there.

Nansi Mishra 8:15

Business should make sense.

Srividhya Srinivasan 8:16

Business should make sense. Right. And he is a number man. I’m a person who needs to do. I need to do and see it work. Only then I’m happy. He is the one who envisages the ideas. This is how, I mean, we didn’t really say that, Baskar, you do this. Srini, you do it. But eventually it became like this.

Nansi Mishra 8:34

Yeah. But if you come with the idea and you have to convince the other two people, doesn’t it feel, you know, a baggage on the shoulder? What if I, it goes wrong?

Baskar Subramanian 8:46

No, we have done hundreds of mistakes. We have done hundreds of mistakes as a team. Right. One unwritten rule that three of us have between us is very simple. Once we align on doing something together, we will never blame each other for what we do. That’s like, it doesn’t matter who, what decision we make, we will all make their decisions, we’ll make mistakes, but always the three of us will back each other in, does not matter what it is all about, we go together in a lot of our decisions so that we will never have this, you told me, we did it, not because we’ve always been that way. And that’s an unwritten rule in the way we operate.

Srividhya Srinivasan 9:23

And we have no fear to discuss an idea. In fact, what we used to do was we’ll discuss an idea and we’ll see if that idea lives with us for one week, two days, two weeks, one month, then it’s something that’s worth pursuing. Because if it goes away after some time, because you found some problem, then it’s not worth pursuing.

Nansi Mishra 9:40

Right. Can you recall some of the fights or some of the disagreements that happened?

Baskar Subramanian 9:45

It happens pretty regularly, I can tell you. The reason is they are distinctly different people, by definition. And I can tell you when we were kind of pivoting the company in 2016, wanting to do this whole cloud-based approach of broadcasting and all this stuff they’re trying to do. I remember a conversation, Srini, Vidhya and me were discussing, and we were proposing saying, we’ll do cloud play out and all of this. And Srini, as usual, went and looked at the TAM, came back, said, the total market size is $10 million. What are we doing here? Sort of argument with him. And Vidhya is saying, how will it work in the cloud? We don’t even know. And I was of the view that, hey, I’m going to imagine it. Let’s try. Worst case, we’re going to fail, but at least let’s try. And I think, fortunately, all the three of us said, okay, let’s go, because the choices were very less anyway. So we said, let’s go.

Nansi Mishra 10:32

This is a very interesting segment. I’ll talk about it in detail. But before we talk about Amagi and this pivot, Baskar, if you can just give us some sort of elevator pitch, like with the biggest achievements you guys have had at Amagi. So a little bit of introduction and then the achievements.

Baskar Subramanian 10:55

Absolutely. Amagi, we are a media technology company. From founding days, I think we started with the assumption that we will build something which will disrupt the market. Whatever the market we get in, we should disrupt it. It should be large enough and it should be for a long time that we should be able to build this as a kind of an, and we don’t call it a corporation, we’d like to call it an institution. And I’ll come to some of the value systems that we follow and why we kind of treat it that way. So that was the first thing that we started off with. Amagi started in what’s called geo-targeted advertising on TV, which essentially meant that if you’re watching a Z or a colors in 2010-12 time frame, for example, you would watch same ad spot if you’re in Bangalore, you will see a different ad, what you’d see in Mumbai or Delhi or Punjab or UP. So the idea was that we split the satellite beam across the country. So every part of the country will have different ads on the same ad spot. This was the core idea that we came in with. And obviously, it was crazy as hell. People said it won’t work in India because of the complexity of cable and satellite. It won’t work, people don’t pay money, a whole slew of no’s that was there in that sense. But we kind of been bullheaded, we said, no, let’s go do it. If somebody says no, it’s actually exciting for us to go about it. So we took that as a challenge. The next six years, we really launched the company and actually do it. And I feel very proud of what we could build at that point in time in terms of target advertising, because we built India’s largest target advertising infrastructure. We had the likes of Unilever, Wipro, Glaxo, PNG, everybody operating on the platform. So that was a big, big milestone for us. For a reason, we had to pivot and we’ll talk about it later. But that’s a great milestone for us. When we started this part of the business, which is the new Margi, what I call the tool auto version of it, we started with the fundamental assumption, very simple assumption. If you look at any media business, for example, there is a camera on one side and there is a TV or a screen or a phone where we are watching content. We naively so started with the assumption that everything in the middle should not, there’ll be no hardware in the middle. From the point of a camera till the point of the TV set, can we take everything as a software infrastructure on a cloud that we can actually run the largest TV networks in the world?

Very brash and arrogant sort of a vision we started off with. People laughed at us in 2016. But what’s happened in the journey, and I think we’ve also been lucky and fortunate through the journey, the industry started changing and the industry started adopting cloud infrastructure over the years, for example. Two big changes that we’ve been part of. One is called FAST, which is the free ad-supported TV as a model, started coming up in the US in 2016-17 timeframe. We were very fortunate to be in the right place at the right time. We became the technology backbone for this whole industry. Today, roughly almost 60% plus of all of the US TV channels in this whole thing runs on an Amagi infrastructure in the back end. And that’s been, again, we got an Emmy award last year for that, where the TV industry worldwide actually awarded Amagi as a pioneer in bringing a technology which actually changed the industry. And that’s coming out of India and coming there is a really good broad moment for us, for our teams and engineers who actually built this whole capability for us. The second thing that’s interesting happened is 2020, the TV, large TV networks worldwide started wanting to change. We started working with NBC Comcast, which is the largest media technology, media company in the world, wanted to move to the cloud. And for some reason, they decided they will work with a small company out of Bangalore to kind of go through that transformation journey. Today, I’m proud to say that in the last five, six years, we run Super Bowl for them. We ran the Olympics for them with all the window picks. So, we’ve become the backbone of this company in terms of all their live and linear play out systems today, for example. So, like I think one of the investors are telling me that Bannerghatta Road is actually running Olympics for the US to watch, Super Bowl to watch. I think that’s been a fascinating journey for us as a company. Obviously, I think we’re in a very early phase of the transformation and we’re extremely excited about the next decade of what’s going to happen. So, the public, going public was a milestone as well for the company, which I think is, we thought it’s going to be a normal. Obviously, when we started the company, slightly over arrogant, we thought we will actually be public. There’s no big deal. But that didn’t happen for a long time because we had to go through the pivot. But I think it was a very good, humbling experience to get there, do that particular milestone. But truly, we feel much more responsible now for the next 10 years in building this capability. That’s where I see.

Nansi Mishra 15:33

Why do you say you’re still very early in the journey? I remember you talking about that it’s just 10 percent of the market that you guys have captured so far.

Baskar Subramanian 15:43

Yeah. So, basically, if you look at it, the modernization of this, see, these are all, all these industries, which have been legation adoption technology, are moving through a giant transformation. A transformation where hardware and satellites and OB vans and everything that you see as a lot of infrastructure in television has always been very hardware and people driven. That is a big change happening in this industry where everything is becoming software driven. We truly believe that it’s in a very, very early phase when just 10 percent of the largest TV networks in the world have moved to the cloud.

Nansi Mishra 16:12

Yeah.

Baskar Subramanian 16:13

And there’s 90 percent worldwide. And television is a global business. So, all of this has to eventually transform to the cloud. And we truly believe we have the right to win to kind of build those capabilities. And that’s the reason I think next 10 years is extremely exciting for us as a company.

Nansi Mishra 16:30

And let’s also talk about the pivot that you guys did in 2018. Right?

Baskar Subramanian 16:35

Yes.

Nansi Mishra 16:36

And so, the whole geo tagging technology you worked on from scratch, right? You built the whole technology from scratch. So, when he said that, let’s just move to cloud business, how was your reaction to that pivot?

Srividhya Srinivasan 16:52

No, no, he was saying it for a reason. So, the reason which he said we’ll describe later I’ll describe it now. The biggest challenge with the geo targeting business was that basically it was cannibalizing the business of the TV networks. So, let’s say I’m a TV network salesperson. I had gone to GSK and asked for the deal for nationally. Now GSK was saying, no, I need only West Bengal and Tamil Nadu and I can take it from Amagi. So, it was cannibalizing their own business and they started giving us a lot of constraints about whom to sell, which agency to work with and so on and so forth. So, at one point we felt that the business will not be as profitable as it should be. So, at that point, we had no other choice that we were left with except to try this out globally. By the time we had gone to, I think, one show, one or two shows in the US, broadcast shows, where people come and look at the technology and there was a reasonable interest. So, that’s what he was trying to pick up. So, while it hurt us, like basically we had built a sales team, which was doing the sales and we had to let go those people. It was a painful exit for them, right? Like, but the point is that there was no other choice. We at least have to try the second one. So, we took it, it was difficult, but we took it in a wholehearted way and we decided to try it in a wholehearted way. And the good news about the second part that Amagi 2.0 is that when we did Amagi 1.0 itself, we were doing everything on the cloud. So, therefore, adopting the technology into the new products that we were trying to do was not such a big challenge.

Nansi Mishra 18:21

And what was the scale of the business before the pivot?

Baskar Subramanian 18:24

Old business is roughly about 180 crores of business. So, it is actually, so we didn’t pivot when the business is not doing. We were pivoting when the business was doing well.

Nansi Mishra 18:34

That was the most difficult part, right?

Baskar Subramanian 18:36

Correct. And again, this is like, see, we had raised about almost 25 million dollars by then. We had spent 20 million dollars. We had 5 million dollars at the bank. I remember the distinct conversation that we went to the board and said, we want to shut this business down. And we doubled that business that year in terms of revenue, at least from a top line standpoint. But like what Vidhya pointed out, all the structural deficiencies we felt, if you are going to run it for the next 30 years, we knew that this is not a structurally solid business design that we were actually doing because we were dependent on three large TV networks, literally being the mercy of them in terms of cost structures and all the compliances. So, that was fairly clear to us that we have to pivot. But I think our board was like, we had a thesis on which we actually put the money. And we had 5 million dollars at the bank. We told them, we’re going to really pivot to a business. I said, how big is that business? It was a few crores, I think two, three crores, if I remember right. And it was a hard conversation. But I think good news is they trusted us. Eventually, they trusted us and said, folks, you know it best. And they knew us that we, obviously, we had built it for the last eight years by then. And we’re actually saying that we’ll kill something for what we did for eight years in our journey and restart from scratch. And obviously, we diluted the whole business, both for ourselves and obviously for them. They thought it’s a write-off, literally. And they said, hey, we cannot put any more money in the business because we don’t know your new thesis. We said, no, no, we don’t need it. We’ll take the 5 million dollars, rebuild the business again. So, we went back pretty much as a startup to some extent after eight years in the journey.

Nansi Mishra 20:09

So, you didn’t raise any new money just use the 5 million dollars in the bank?

Baskar Subramanian 20:10

We didn’t raise money at all. We said, we will sit tight, we’ll just move everything back.

Nansi Mishra 20:16

So, that’s why you had to let go of the team?

Baskar Subramanian 20:18

Yes.

Nansi Mishra 20:18

Otherwise, you would have kept them?

Srividhya Srinivasan 20:19

Not that. They were actually local salespeople who were selling ad sales. So, I cannot use them. That is the reason we had to. So, the engineering team remained intact. But the people who were involved in operations and the sales had to be let go.

Nansi Mishra 20:33

How big was the team that time?

Baskar Subramanian 20:35

120 people.

Srividhya Srinivasan 20:36

Yeah, 120 people.

Nansi Mishra 20:37

And now how big is the team?

Baskar Subramanian 20:39

A thousand people.

Nansi Mishra 20:40

How many of them are in Bangalore?

Baskar Subramanian 20:43

700.

Srividhya Srinivasan 20:43

Seven, yeah, out of, yeah.

Baskar Subramanian 20:45

Yeah, 700. 700 plus. 650 to 700.

Nansi Mishra 20:48

650 in India and the rest of them are in Europe and.

Baskar Subramanian 20:51

Europe, US. US is big. I think almost 120 people in the US.

Nansi Mishra 20:55

Okay. And then just maybe if you can talk about more, more about this part that you had 5 million dollars in the bank account and then what happened in the next few months?

Baskar Subramanian 21:06

So, I think first thing is, obviously, it was a emotionally hard moment for the team because I think we had a fantastic team. The team actually had put all their heart, soul and to get this where we were as a company. So, they were more friends and family for us rather than actually employees in some sense. So, we had to call them and then say, you know what, hey, we’ve tried this. At this point in time, you know the hardships we’re going through as a company, you know. And so, it was kind of a bittersweet sort of a moment for all of us. Even today, they’re all good friends and we kind of talk to each other. And so, we had to first get that done. And simultaneously, we had to build this business to start off with. We went back to first principles and said, let’s get, first we had to bring the cost structures down to where we could afford it, number one. Number two, we needed somebody in the US because we were all in India at the point of time. Srini, everybody’s in India. So, the biggest call, I think, so we got Srini to take us because Srini was always a go-to-market person. So, he had to approve his family completely like what I’m sure all the founders do. Had to take them back and he had kids who were in the sixth grade, for example, at the point in time. So, they were always, they were born and brought up in India, but here was a situation that we had to do. So, he took that call to kind of pretty much approve the family from here, take them to LA, settle them down. We didn’t even know how big the business was, but we had to take that call to do that and set that kind of completely new lifestyle that he settled in there from Apple. Fortunately, he went to LA where I think that the timing was right for the business. As I told you, the fast, the free ad-supported model was starting to work. We found that to be the right place, right time where we could be the technology vendor and that was the moment I think we felt, okay, now we got a product market fit of some fashion. So, I think good news is obviously three of us are pretty much operating the business literally. In that sense, we were kind of hands-on. The company was a 40-50 people team at that point in time. We had already become small. So, I think that was the core of the business for us to kind of restart the journey for all of us and start rebuilding it. So, every night he used to call and then Vidhya and Srini used to talk about what to get done. The rapidity at which we could deliver things, our customers are surprised because we used to leverage the 24 hours very well. 12 hours discussion and then Srini used to call in the evening, late night. The team starts building things out. Next day morning when Srini is there, he actually got a product which he can actually show to customers. So, that is the sort of agility that we could show. I think made a huge difference in terms of our own success. I think sacrifice of Srini to go there and do that and the ability for the teams to do it. I think it’s been a great job.

Nansi Mishra 23:39

And how old you guys were when this pivot happened?

Baskar Subramanian 23:44

We had already, I think we had spent eight years, I think 29-30. We are like almost close to 40, right? 35. Yeah, 37 to 40, right?

Nansi Mishra 23:52

The time, most of the second time founders start.

Baskar Subramanian 23:54

Pretty much, yes.

Nansi Mishra 23:57

And when the next round of funding happened?

Baskar Subramanian 23:59

So, what we did is we with 5 million dollars, we actually became profitable as a company. By 2020, I think we had become, we were doing about 20 million dollars for business.

Nansi Mishra 24:10

Okay, wow.

Baskar Subramanian 24:12

So, we’re like from zero, we just kind of rapidly grew and again the company was pretty much doubling and tripling and some other time. So, we were kind of growing. Given the size of the teams and others, we were already profitable as a company. So, we didn’t actually need money technically. Only reason is in 2021, I think our investors were invested in the early part of the journey. Obviously, timeline had come where they had to exit.

Nansi Mishra 24:34

Yeah.

Baskar Subramanian 24:35

So, a couple of those investors came back saying, Baskar, we love the business. What are you guys trying to look at? Really looks interesting, but we cannot, our journeys have to end here. So, incidentally in 2021, early 2021, we did a deal with Accel, Norwest and others only as a secondary transaction. We said we don’t need the money. So, we didn’t take any primary in the company at that one time. We said if you want to, they’re ready to sell, folks can buy. We’re not going to get involved in the business, right? That’s what it is. When they came in, I think before that, in the next six months, we actually already doubled. The company had started becoming almost $30 million plus. At that point in time, I think we all sat together and said, okay, now it looks like we can build a billion-dollar company at some scale that we could potentially build. Is it important for us to go look for some sort of money to be raised because that will help us to expand the team? We were having a seven-people sales team, which was driving a $30 million ARR business. So, I don’t know, sometimes it’s super efficient, sometimes it also burns out people. And we had a team which was very small in India as well. So, we didn’t have next-level management teams at all. So, at that journey, late 2021 and 2022 is when we raised capital largely to fund the business to the next level. And that’s been the journey we started off.

Nansi Mishra 25:49

And how big was that round?

Baskar Subramanian 25:50

First one, we did about $100 million. The second one also, we did $100 million. But I think partly there was also secondary because we wanted our teams to also get money back because it was almost a time to kind of give back as well in some sense. So, we did that in two rounds. And then I think about $80 million, 80 plus 80, almost like we had about almost $150 million of primary capital came in. $50 million was all secondary.

Nansi Mishra 26:15

And if you can talk about the next phase of the growth, after this funding happened, how did we use the money? What all happened?

Baskar Subramanian 26:25

So, obviously, see, we had more money than what we could spend, even today. And that’s the way the company has been like. One is, we’ve been always a very capital efficient company because we are always a software company, doesn’t need a lot of capex in some sense. And we don’t need a lot of marketing because it’s a vertical business that we are in. Our biggest costs are people and nothing else, literally. So, that’s the way the business has always been. So, although we raised, I think, two raises we did, out of which I think close to $100 million was in the bank, even when we went public. So, the money was not even used in the whole system, for example. Having said that, the first thing we did is to obviously build the next layer of management teams. So, we brought in head of sales, we brought in engineering teams, engineering heads, and all of that. We kind of started building the next layer of teams, for example. And that was a two-year journey that we went through. Again, we took a loss with the business because we had to build that whole capability and capacity building that we did, after which we again came back to profitability. So, that’s the only space where we actually spent the money. And else we are like coming from middle-class families and we are like, at some point, we are not a very brash sort of, we don’t spend a lot of money in most things in life. So, it’s literally getting office to a point where it actually looks good for everybody to work and getting things done. So, we are like really basics are covered. I think we are happy with that sort of stuff.

Nansi Mishra 27:45

And before the IPO happened, company was valued at, I think, some 1.2 billion dollars.

Baskar Subramanian 27:52

Correct.

Nansi Mishra 27:52

And the IPO happened at 825 million dollars.

Baskar Subramanian 27:56

Correct, correct.

Nansi Mishra 27:56

So, if you can just talk about that.

Baskar Subramanian 27:58

So, essentially, if you look at it, going public provides the liquidity, there’s a liquidity premium in India, right. So, it’s important. Again, as if you look at the goal, the genesis of why we did the IPO. See, our investors, none of them wanted to exit because they are like, they were just four years or some of them are only three and a half years into the IPO, into the company. So, none of them wanted to, there was no exit pressure for anybody to do it, fundamentally. And there was no exit pressure for us as individuals. We are like, I think we are well settled. I don’t think we needed any sort of stuff, exit or liquidity to that extent, right. So, the only biggest motivation that we saw is for our teams and employees who kind of struggled with 1.0 and a 2.0 cycle. And we had people who spent more than a decade with the company. And the emotion, I think, I think Vidhya pointed out the emotion when we started, three of us were discussing and I remember sitting in Sunnyvale.

Srividhya Srinivasan 28:48

Should we do IPO was the discussion.

Baskar Subramanian 28:49

Sunnyvale, we were discussing, truly, do we really need an IPO? Because the company is profitable, we’re growing, our investors are happy, there’s no good reason to go IPO, should we do that at all, fundamentally, right. And we don’t have this ego trip of wanting to be a public company. So, we didn’t have that as well. And we know all the challenges if you’re a public company as well. So, we kind of understood the balances. It was a very balanced call. The only big emotion, I think, when Vidhya pointed out was, hey, our teams need liquidity. Eventually, these people have been with us for so long, how do we enable them to buy their houses and car and whatever they want to buy in their stuff, and at least have a legacy for saying, hey, I worked at Amagi, I got something done with this whole thing, is an important emotion. I think that is the core emotion that drove us. The secondary part was our customers are starting to become larger and larger. Enterprise customers are starting to come. For them, they wanted the longevity of this, because our business is an enterprise business. So, people want to feel comfortable that you have, you’re going to be for a long time. Public provides that credibility, the transparency, and eventually the respect in the industry that, hey, here is a company for longevity that we can trust with our infrastructure, because these are mission-critical infrastructures that we run for our customers. And I think in that sense, that was a real decision process that we went through.

Nansi Mishra 30:04

And you guys also bought back shares, right? But most of the founders wait for the events of liquidity, right?

Baskar Subramanian 30:12

No, see, we are really, this for us is, we’re leaning in heavily. This, we would have loved to have more shares in the company, technically. As a company, I think we truly believe strongly, the next decade is a transformation. And again, the conviction is extremely high. And that’s the reason we want to lean in. If you look at it, we didn’t liquidate any, not a single stock. In fact, we had a challenge even getting our investors to liquidate the stock because they knew that the business is actually doing well and getting through. So, it’s always been a, that’s the journey. So, high conviction is a very important part of it. We want to lean in and do things because we truly believe there’s a big opportunity in front of us to kind of build it up.

Nansi Mishra 30:49

So, And then if you guys can talk about the version 2.0, like, if you can break down the business model of Amagi 2.0.

Baskar Subramanian 30:59

Okay. So, if you look at it, so, fundamentally, it’s a software business. We are providing software to a TV channel. So, think about any TV channel today, for example. When they want to create a live sports or a news or entertainment channel today, for example, they buy hardware, they set up a studio, they take their cameras to all the field, they bring what’s called an OB van, it’s a satellite which actually captures all the content on the cameras, sends it back to a production center and the studio is in one location where you create all of this and eventually send it to homes through distribution, either through satellite or through IP networks or internet that we all watch content. It involves a lot of hardware and real estate which actually drives this business. What Amagi does today is to convert that into software. And when we converted the software, the biggest change we did was start, it was a CapEx intensive business. You have to buy all these equipment, create all of this. What we did was to convert it into an OpEx business. What do we do? We lease cloud from the likes of Amazon and Google and others. We host our software on the cloud and we pay money to an Amazon on a per-month basis. Similarly, our customers paid us on a per-month basis. So, we made it a subscription model for the business which allowed them to pay us on a per-month basis and we are able to kind of, obviously, the transaction is where we pay for the cost of goods or in this case, the cost of the servers and the software for the cloud that we pay. That’s the core business model. So, suddenly, customers can launch their channel, run live sports and news by paying on a per-month basis. Although contracts are longer periods, but they’re paying only on a per-month basis. That’s the core big change that we did for the industry. And this is our genesis of SaaS that’s been there in every other part of the business. For the broadcast world, we brought in the idea of SaaS of how they buy software and replace their hardware with the software and an OPEX sort of model. That’s a big change we brought in.

Nansi Mishra 32:58

And like we talked about before this conversation started that 73% of the revenue comes from US and the kind of logos we have at Amagi, how do you convince them? Because this is the advice B2B founders keep hearing who are building for US market that you have to not just the tech team can be in India, but for a business team, you have to be in US. So, how hard it is to sell to US market and the kind of logos you have being a local company?

Baskar Subramanian 33:36

Two parts.

Nansi Mishra 33:37

And how was it before and how it has changed now?

Baskar Subramanian 33:41

It’s changed dramatically and I can tell you. So, if you look at it early days, I think we were, see nobody believed that a company out of Bangalore will be in broadcast tech. We were never known for tech and more importantly broadcast, which is like a very mission-critical software technology. So, I don’t think anybody thought that a company out of India would actually kind of be able to support them and run the most critical workloads ever. Two things are happening. One is, I think, given Srini was there, I think it helped us to create the presence of saying, hey, we are local, we are in the US. And people understood this whole idea of having GCC sort of operations environments in India. So, India was not at the place that people thought, it’s not something that they didn’t know. They knew that India existed. So, they treated us as a somewhat of a local sort of presence. To that extent, that helped a lot. And I would think that having a founder, having the presence is super important. If it is any other sort of, hey, another head of sales there, you wouldn’t bring the emotion, the passion, the ability to convince people. I think, so founders being there was a super important part of the journey for us. I think from a success, I think that is a very critical part of it, number one. Number two, if you look at it, no large broadcaster decided that they’ll work in one day. So, obviously, it was a big journey for everybody to go through the process. What changed is obviously the industry change forced them to look at it. And what we’ve seen, again and again, this is something that we learnt over the process is that we follow a book called The Crossing the Chasm. So, this is a book by a person called Jeffrey Moore. He talks about a mechanism of almost a Gaussian curve or a binomial distribution curve that you see is the way how industries perform. There is the early adopters in the first part of the graph, visionaries, early adopters, pragmatists, and legats. That’s the way the bell jar is replaced, right? Obviously, the early adopters and the visionaries are people who are irrational in decision-making process. So, it’s important and I think we were kind of lucky to work with companies and the CTOs and decision-makers in these companies who are irrational to some extent. Because if they had started calculating numbers, assessing Amagi as, hey, is it X to Y, I put an RFP, figuring it out, we wouldn’t have crossed any of these milestones. These are people who felt, hey, here is Srini coming in and actually talking to me, I feel the passion with this person, they’re delivering things in my POCs and stuff at the speeds with which I have not seen with my vendors. It’s worth a bet. I know it’s irrational in my heart, but let me take a bet and look at it. I’m not going to give the highest workloads to start with. I will give my fringe projects to you, show me what you can do, and then let’s see the whole process play out. I think that’s where the journey starts and we were really happy to lap it up. We said, okay, let’s get into these large organizations and demonstrate why we can be world-class and do that.

But the beauty is we were able to quickly get through that ramp curve of trust. Today, some of our customers run tens of billions of dollars of content through Amagi’s infrastructure. Now, sometimes I feel I joke to my customers that the tide has turned, where they call me and said, Baskar, hopefully you guys are clear because you are the backbone now. You cannot afford to fail. We cannot fail today because that actually will be a big challenge for them, for example. And now the brand, the trust is so high in the industry today. For example, I think we just came from a show where I think all the top-tier customers worldwide wanted to be at Amagi where they said, okay, I want to meet these guys. Looks like they’ve been always innovative, creating new things, big trust. Obviously, that’s been earned over a decade and fortune also matters, luck matters in all of this, being in the right place, but also being choosy about which customers you start to work with who can kind of carry you in the journey. So, for us, I think our biggest success is our customers who actually took us where we are today.

Nansi Mishra 37:38

Who were these early customers?

Baskar Subramanian 37:41

For example, NBC Comcast, I think they took a bet, I think.

Srividhya Srinivasan 37:45

2019, they decided to start the project with Amagi.

Baskar Subramanian 37:48

I think that was a big bet for them as a company. If I am NBC, I think they were like, I remember the day they said, hey, we cannot sign the order because we want to know your financials. And I was scared because we were like, we are, I think, less than $10 million and the deal was a $17 million deal at that one time. So, we’re thinking, I have a whole company, it’s $10 million. How do we sign a $17 million deal? Then I remember going to Premji Invest, who was one of our investors, to get a blank, pretty much a blank commitment from them saying they’ll support the company. And I had to give that letter to NBC saying, you know what, trust us, we have backing, which is really solid. Obviously, we had to bank on Premji’s brand and Premji’s invest, saying that they’re ready to back the company for whatever time and get it done. So, because their finance teams and procurement are saying, who are these guys? Where are they coming from? And why are you giving them projects to them? So, some of this is also about the journey was a lot of these moments were lucky moments to some extent, having the right people made a lot of sense.

Srividhya Srinivasan 38:49

I want to add something. So, basically, yes, founder presence is very important. The customers were coming to us. But media is a very brutal operation, right? Imagine, you’re watching a match and something goes blank.

Nansi Mishra 39:01

Exactly.

Srividhya Srinivasan 39:03

So, actually, our customers were very scared. Initially, Srini, I was running this pre-sales customers, all of those. So, Srini used to tell me that, you know, I need people in the US, I need people in the US. I used to say, no, no, no, we’ll do it from here. We are available 24 by 7. We are available at midnight. But customers were never convinced that that was really true. And then slowly I turned and then, you know, we hired a team, we set up a customer success team, we made sure that people are there, they saw the commitment, they saw that there is some phone number to call locally and somebody will answer me if there is a problem. Once that trust comes, that is when, you know, people start trusting you a lot more and things become easier. So, we built a reasonable size, you know, GTM team.

Nansi Mishra 39:45

And what are the other customers we have?

Baskar Subramanian 39:48

We have 450 customers now.

Srividhya Srinivasan 39:50

For the top number of names, we have Sinclair is one of our top customers, Lionsgate, Dazon, they are actually the, you can say, call it them as a Netflix of sports, they’re based out of Europe. Then A plus C, which is now called Hearst Networks, the History Channel, Fox, WarnerMedia, WarnerMedia Discovery.

Nansi Mishra 40:11

How do we sign these contracts? Because this is such a sensitive, you know, job, because like you said, if a second of screening goes off, it’s a total mess, right?

Srividhya Srinivasan 40:26

So, they also take a lot of time, that’s why closing some of these deals take time, because they also go through a process wherein they look at the technical architecture, they compare, they do a proof of concept, they ask you to show the redundancy, switch off one region and show that the whole thing works. All those they would also do. And then you have to give the SLA commitment and make sure that you stick to the commitment on a monthly basis to ensure that the product really works the way in which it should.

Nansi Mishra 40:51

I also remember you talking about this part in detail that there are some other clauses also in the contracts, if you can just talk about those clauses also.

Srividhya Srinivasan 41:01

There’ll be a lot of clauses. So, like, first time when we had to do this SLA, I couldn’t understand the actual meaning of 99.99. So, 99.99 means of a whole month. So, you take the number of seconds, then you take like 0.001 say one of the total seconds that’s available, right? That’s about, I think 99.99 will give you about 30 seconds, right? 40 seconds.

Baskar Subramanian 41:25

No, 99.99 is 17 minutes.

Srividhya Srinivasan 41:27

17 minutes.

Baskar Subramanian 41:27

We have a lot less than two, we had about two minutes was the downtime that we could do in a year for 99.999. So, we had a five-nine.

Srividhya Srinivasan 41:36

Five-nine clause to the customer. So, all of these you need to understand and you need to make sure that you put in the thing which is something achievable, physically achievable.

Nansi Mishra 41:45

And if you mess up with that.

Baskar Subramanian 41:47

No, largely two parts, right? So, customers, when you write a contract, typically customers are wanting to protect themselves. So, that’s what it is. But what we’ve seen realistically is customers are really wanting to know your intent. And obviously, we’ve never been fully perfect, ever. I don’t think any of us could be perfect and they didn’t expect us to be perfect as well. All, every time they want to know intent wise, are you going to go solve these problems for us and actually become better, right? So, as a company, if you look at it, one of the value system that we really espouse is called be vulnerable. Vulnerability is a very important trait for us as a company, not only internally between our teams and leadership and everybody else, but also with our customers. With our customers, we always have a relationship where when something gets screwed up, we call them and say, you know what, we screwed up. We would never give them saying, this is something that we should have done. We have not solved it. It’s our problem. We will go fix it. And proof point is obviously, we fix it and demonstrate that we actually fixed it. So, trust gets built when you go through this process. In fact, I remember some of the enterprise customers came in and asked us, the first question they were asking us is, how many times have you gone black on the screen? The naive answer is if I told them never, they wouldn’t have signed the deal. They told me very clearly. If you had told me never, the way I would see it, not because you are telling, not telling the truth, but we would believe that you never done real broadcasting. Because if you have really done real broadcasting, nobody gets it without a black screen. So, everybody goes through the process. The question is, how did you come back and recover and what did you do is much more important for us or somebody naively telling them that it will never go black or never fail, for example. Those are all in a complex business like what we run today. It’s the ability to know that failures will happen, but ability to recover from those failures and more importantly, fix them forever so that you don’t come back. I think that’s the success of all of these systems because the systems are becoming more and more complex on what you are trying to do.

Nansi Mishra 43:54

So far, we have talked about the crucial milestones of Amagi, the pivot happened and how did we decide for the whole IPO thing. What are the other five major decisions you guys have made?

Baskar Subramanian 44:09

I think the first decision of starting together. At Amagi, as I told you, one of the first things we did was to, what are the tenets that we would like to do? Because as I said, the big decision we made is next 30 years, we’ll try to build it. I think that was a decision which is a very deep decision, not easy. I think at some point, we also thought we will be successful, which didn’t happen in the first part of the journey. So, it was a decision we stood together and it’s not like at the pivot level, we said, okay, now it’s not working, let’s kind of do quits. We didn’t do it. Three of us said, no, let’s double up and let’s do that. So, that is a very important decision we made. At that point in time, we also took the decision to do something in India for India at that point in time. That is a decision we changed in the midst of the journey for the business dynamics of what it was. But I think we kind of stood with that decision for a long time. And at some point, I think I remember one of the investors in the middle of the time when we were doing the India business, we were trying to raise money, we were talking to him and he said, I think guys, the amount of work that you’re doing in India, the same thing if you do it for any other country, you would have been a much more successful business than what you’re trying to be in India. Why are you guys wasting the prime part of your lives trying to do that? I think we heard it, but we didn’t want to, we didn’t want to pivot because we said, no, no, what’s happening in India, we’ll make this work. So, that is the second part that I remember as part of the journey, it’s important to look at it. The third is the pivot itself, which is a big uncertain event for the company. And we had to take a call to drop something which looked like success, because revenues are growing in others. And yet in our minds, we never thought we’ll be able to build a long term in a 30 year view, that eight years was worth sacrificing to some extent. And eight years is long. So, lots of people felt we are illogical and irrational at that point time to take a call to go to a very small business which never existed and try to build it versus try to take this.

I think that is the third big decision that I feel truly about. Fourth, I think Srini always comes back and tells me that by shrinking and making something more focused helps you rather than trying to do too many things. So, when we started the new part of the business, the first thing we decided that we’ll do only one country, which is US, we’ll only do one product, we’ll only do one cohort of customers that we’ll go to. So, by sharply focusing ourselves not trying to do, oh, what happens doesn’t fail. We said, okay, it doesn’t matter. We’ll put eggs, every egg in that basket, make sure that we’ll make it successful to an extent. Till the point we know it’s not successful, we’ll move, but we’ll do that actually. I think that was a critical stuff where we could just truly focus brings a lot of strength to the whole thing because everybody in the company is focusing on one thing, one geography, one time zone that we had to manage, one language to worry about, one standards to buy, everything was like much more sharply focused. I think this was a big learning for us as both as three of us as founders, as well as for the company itself, how focus can make world-class companies get built completely.

I think hindsight that was easy. At that point in time, it was scary because you’re taking everything and putting in one basket, would it all fail? What happens? Then you’ll be back to the drawing board to some extent. Should you do three things, two things, which you can do it? I think at that point in time, tripping it and saying we’ll only do one thing in one geography, I think is a big decision that we made as a company, literally.

Nansi Mishra 47:34

You also wanted to add.

Srividhya Srinivasan 47:34

Yeah, actually, there was one technical decision which we took. For me, it looked like the biggest thing which changed the history of the company. So, in the first phase between 2008-2015, when we were building, we were using the cloud, but we had to install hardware in the end, we call it as head-end, the cable did the center where the splicing happens, what Baskar was saying, the splitting of the satellite beam happens. And then later on, when we decided to pivot in 2016, we started with the Intel servers, wherein we were putting the software. I still remember a lot of time where we had to take the box, go install in a location where they are transmitting the signal and all that. But at that time, one point in time, we just said enough of this hardware mess, let’s only do it on the cloud, which is basically, as he explained, renting data centers in the cloud from public cloud companies like AWS and Google and doing it only in the cloud. We took that bet and we ran the 24 by 7 running linear channel on that. And then we started pushing that to the customer. That one moment was a transformative moment for Amagi. That is how the cloud-based SaaS solution came in. So, that is one that I could remember. And now the recent one, we recently took a goal saying that, you know, we will bring in all the AI products from Amagi in the next two years, and we will make sure that our significant portion of our company’s business runs through the AI softwares.

Nansi Mishra 49:04

What are the questions your investors and customers are asking regarding AI?

Baskar Subramanian 49:09

So, the way we present to people, and that is the way we at least are, have high conviction internally, is when you are an infrastructure business like what we are today, for example, where we are running the gut of the systems for our customers, that is not a reasoning system. It’s really a video fabric, a pipeline which is running and built. Versus an application business is very different. So, the way we delineate to them is, hey, we are a mission-critical infrastructure just sitting in the pump pipe there, and nobody’s going to go wipe code that into it because you don’t want my tens of billions of dollars running on a wipe-coded business example, right? So, those are the ways that we think there is a, and this is now providing us a huge opportunity because of the tectonic shifts. Now, the transformation is happening on top of the infrastructure. We own the infrastructure. Now, we have the right to win to building everything on top of the infrastructure for our customers. I think that’s the biggest value that we’re able to drive value. And again, that’s, but again, there’s a vantage point of one company the way we see it. But if I’m an investor, truly it’s very hard, and I’m an investor myself personally. And when I look at a lot of the companies, it’s very hard for me to feel comfortable. Is it a one-month-away problem or is it a one-year-away that somebody’s going to just sweep it up?

Nansi Mishra 50:19

Can you share some examples, like some companies?

Baskar Subramanian 50:22

See, obviously, lots of the SaaS companies which are in the application domain is a hard problem because will it be something that we can actually make them survive and grow? It’s a hard problem, truly, and not because it was all very sensibly good businesses 18 months back or 24 months back. And that looks like that can actually be replicated in a few months or a few weeks. The moat of these businesses and every business, including us, I think the transformation is going to happen. I feel that we, there’s a person called Hamilton Helmer, who’s written a book called Seven Powers of Strategy. And that’s been a very timeless book to some extent over the last 20 plus years. I use that as a framework through which you apply for every business. And because that’s not changing, the strategy of the businesses. So, sustainability has to come through some sort of business moat and not through just technology moat alone. Because there’s nothing called a technology moat and that’s gone for everybody, right? It’s become a zero-sum game for all of us. And when software becomes close to zero, then the moats are going to be the business moats and what you’re trying to drive at. So, that’s my lens of even evaluating ourselves, our businesses, as well as any other business that I see today.

Nansi Mishra 51:33

So, how are you planning the next five years considering this AI?

Baskar Subramanian 51:37

I think for us, I think it’s two parts. From a vantage point of where we are, for example, our customers, like what I think Vidhya pointed out, right, are seeing, hey, can I, where is my operating leverage because of AI? That’s one big question for them. Where do I think I can, now I have a specific business competency, which is content creation, storytelling, can I make my storytelling better? Can I really bring it to new audiences, for example? So, these are genuinely large opportunities for them and for us to leverage the whole AI as a capability to transform those capabilities, for example, right? And again, there are many, many such examples, right? Today, for example, we had launched a product called News Pulse. It’s actually four news channels. Now, they want to target the Gen Z population. Local news in the US is a 40 plus sort of age group, viewership audiences, for example. But over the years, they’ve built billions of dollars of infrastructure and business to kind of cater to the community. Now, but that’s not the most attractive component. You want to be able to get to the next tier of population audiences, for example. What do we do? We take their existing content that’s already been, they have hundreds of millions of dollars of studios and production and stories coming in. We transform that into tweets and social sharing and others, for example, so that we’re able to reach audiences in the devices that they actually do today, not on the television sets of the past, but in the phones of the future that we’re able to do. That’s one example of where we’re able to carry these customers to the new journey. And all of this is done through AI infrastructure and agentic infrastructure. And we launched, perhaps, the only agentic AI infrastructure software today in our business, for example, which helps our customers to do that. And again, this is one of a battery of new offerings that’s going to come in. I’m not going to look at all of that right now, but the idea is that we’re trying to build those journeys for our customers.

Nansi Mishra 53:29

And maybe after the podcast, I’ll also discuss the startups that you evaluated.

Baskar Subramanian 53:33

Yes, yes, absolutely.

Nansi Mishra 53:34

Very excited for that also. And Vidhya’s journey is even more interesting. So I would want to talk to Vidhya. I think Anjali also talked about this in her LinkedIn post that Vidhya is not just one of the few women techies in India, but there’s also someone who has led the company throughout all these years and even took the company to public. And how you started, you worked in a global company also, being a 2x founder, now, you know, building a public company, leading it on the front. How has this journey been for you, Vidhya?

Srividhya Srinivasan 54:17

It’s very fulfilling to say, as Baskar told, I love the job that I do and I do it with utmost passion.

Nansi Mishra 54:25

But Baskar has so many examples. There are so many men who have done it, right? But for you, when you were, you know, in that room, where you only said that there are so many women investors you are seeing at one place, right? You didn’t know that we have so many women investors in India, that you got to see in that room that day. So for us, we don’t have those many examples. You are one of the very few examples. How do you feel about it?

Srividhya Srinivasan 54:55

No, I think I’ve told about this many times. See, in the role that I play, even when we were building the software or whatever, gender should never come into play. If gender comes into play, it becomes very difficult to do. For me, the role models are all the, you know, people whom we all looked at, like, you know, Pete from the founders of Apple, founder of Microsoft, all those stories we have heard and, you know, we have seen the software that they’ve built, we have seen, we have studied computer science with utmost interest. So, the interest was in what can you do? How can you build? And slowly it goes over time. I’ve been lucky and I’ve been fortunate to be associated with these guys, to have built this company.

Baskar Subramanian 55:32

No, no, foundationally, again, two things that in my mind at least comes, right? At least Srini and me never took Vidhya as a, oh, women founder. I mean, I don’t think, I think for me also, personally, if you look at it, when we built it from the trenches in the last 30 years we’ve been together, I think in the last few years is when we really thought, oh, women founders is something that’s distinctly different. Because I don’t think we treat each other as, oh, women, male, female, that actually doesn’t gender as we’re pointing out. We never had that in our, and that’s the way the company behaves in itself, right? So, company behavior is like, nobody thinks it’s like, oh, and lots of people who join us sometimes don’t even know that we are actually spouses.

Nansi Mishra 56:11

Yeah, I have to confirm it.

Srividhya Srinivasan 56:14

And the name is very confusing, right? Because my last name says Srinivasan. Even if they think that they were spouses, they would think that Srini is my husband.

Baskar Subramanian 56:23

So, that’s been the one, so we kind of kept that.

Nansi Mishra 56:26

But you intentionally kept it like this.

Srividhya Srinivasan 56:29

Yeah, people should work with you because of what you are, not because, you know, you’re so and so’s husband or wife. So, that’s how we looked at it, yeah. Yeah, that is one. And I have struggled not to say that this was easy. With the kids especially, I’ve struggled a lot, you know, juggling between guilt, work, and doing things for them. But I’ve been fortunate to have a fantastic family, especially my mother-in-law is staying with us, and she helped us all through this time. You know, if it is not for her, we wouldn’t have had both company and family, you know, growing up at the same time. It would have been extremely, extremely tough. So, we have had a fantastic family support to have, to have been able to do this.

Baskar Subramanian 57:12

And we had taken our kids to, they come to office. So, and we were homeschooling both of them.

Nansi Mishra 57:17

We don’t have any other choice when both the parents are…

Srividhya Srinivasan 57:19

Yeah, so middle school, they were homeschooled.

Baskar Subramanian 57:21

Homeschooled, fully.

Srividhya Srinivasan 57:22

During their middle school.

Baskar Subramanian 57:23

So, both of us were teachers. So, that’s what I actually, I think, I remember, I think I don’t have a photograph yet. It’s about when our kids were young, I think, one was, I think, they’re 18 months apart. So, one was a young baby and she was kind of obviously feeding. So, she had brought both of them to office. So, we’re having a meeting in the office where everybody’s sitting together. She’s having the baby with her and the other one is running around and we’re having a meeting. So, we’ve kind of been, people also understand that, hey, this is a work environment and that’s the reality of things. So, kind of, we’ve been very, and some of our meeting room boards will have trigonometry equations sometimes because we bring them to office and actually whenever there’s a break, we teach them.

Srividhya Srinivasan 58:05

Yeah, yeah. When they saw me juggling, they really did it. But I think, as parents, we have done, I feel that at least we have done justice to both your education with whatever we could.

Nansi Mishra 58:16

I think we have covered most of the questions I have here. We can start with the rapid fire round. This is the last round. We have already recorded for one hour. So, I’ll ask a question, you both can jump in and try to be as quick as possible. So, I think Baskar has already talked about one book. So, maybe another book or Vidhya can talk about the book.

Srividhya Srinivasan 58:39

Built to last.

Nansi Mishra 58:40

Huh?

Srividhya Srinivasan 58:40

Built to last.

Nansi Mishra 58:40

Built to last.

Srividhya Srinivasan 58:41

B-U-I-L-T. Built to last. Want to talk about the book? Yeah. So, that talks about companies which are built to last for decades and ages and maybe hundreds of years.

Baskar Subramanian 58:51

Jim Collins book.

Srividhya Srinivasan 58:52

It’s written by author Jim Collins. That is the first book one of our friends and earlier colleagues of our first company introduced us to.

Nansi Mishra 59:01

You read it before you started the company.

Srividhya Srinivasan 59:03

Yes.

Nansi Mishra 59:03

That’s why the 30-year framework came into the picture.

Srividhya Srinivasan 59:05

That book laid the foundation for where we are right now.

Nansi Mishra 59:08

And it helped you guys, right? Because it’s been a long journey. So, you never thought that it is going too long.

Baskar Subramanian 59:14

Correct.

Nansi Mishra 59:14

Because you were already prepared for the next 30 years.

Baskar Subramanian 59:17

Correct. Correct.

Nansi Mishra 59:19

And one founder in one company that you both admire.

Baskar Subramanian 59:24

I think I have many actually, but anything specific? No, I don’t have anything specific.

Nansi Mishra 59:29

You can name two, three founders.

Baskar Subramanian 59:31

No, largely I can just to give you context.

Nansi Mishra 59:33

Yeah.

Baskar Subramanian 59:33

Maybe not today. When we were in college, for example, right? So, obviously, Bill Gates was the entrepreneur that we were looking forward to. Obviously, Apple was not there at that point in time. So, we were like ahead of that time. I remember seeing a Byte magazine. Those days, no internet. B-Y-T-E was a magazine, Byte magazine. So, I remember getting to college and looking at that stuff where windows, I think 3.0 was launched, not even 95 was launched, 3.0 was launched, and there’s a big sheet where it’s actually done and Microsoft went public at the right time. I think that was an aha moment for me personally was, wow, this is a moment where, and all of us love software, so I think the curiosity of wanting to build software always, even today, I think that’s a common strand of wanting to build things as a builder, right? So that moment is what actually started saying, okay, we can be entrepreneurs, we can actually write software and actually build and change the world, was an opportunity. I think, till date, I think that’s been a passion existed to see that sort of a journey.

Nansi Mishra 1:00:36

Any company where you really loved the journey they had as team, not just the founder, like Amagi is one example, right? Because Amagi is very, Amagi is a great example for a fund like Neon also, because when we talk to our investors who are outside India, we show them that Amagi has done it, right? Moengage has done it, Capillary has done it, Unicommerce has done it, and this is just the beginning, because it took a lot of time for these guys, but now that the younger founders have these examples, have these playbooks for them, this number will multiply only, right?

Baskar Subramanian 1:01:18

Correct, correct, true. Now, I think, see, overall, I think this is like, I think when Elon Musk actually brought the rocket back and actually brought it to the ground again, it’s a reusable rocket, till that point, people are not convinced that it’ll ever be done, but now we’re seeing Blue Origin doing it. I’m sure every founder now today in that particular sector. So, always I think the first thing is to kind of go through that certainty of, at some point of thing, it’s doable.

Nansi Mishra 1:01:41

Yeah.

Baskar Subramanian 1:01:42

From India, we can build it for the world. I think that, once some one person crosses the journey, yeah, I think it’s a flood that we can actually create it, and that’s what I’m seeing all the new founders. I really find it very exciting because of the, again, I travel a lot, and I’m seeing other parts of the globe, and also the excitement, the passion, and more importantly, the brashness of the confidence that Indian entrepreneurs have today, I think is something that I’ve only seen in the valley. Beyond that, you don’t see it anywhere else, and I think that’s the biggest change, the ability to say, let’s go hit for the fence, and play it big, and fortunately, the access to capital and access to resources existed, which didn’t exist when we started in 2000, there was nobody to fund any of our companies, there’s no venture capital. So, we had to self-fund the first company fully, literally, right. So, versus now, I think that’s a big, big change, and I think that’s going to change the country dramatically.

Nansi Mishra 1:02:35

And one single most counterintuitive thing you have learned about the US market, because you guys were selling to India market, and at one point in time, you decided that you would just focus on India market, US market.

Baskar Subramanian 1:02:52

I felt the ability to take bets and try new things. There’s no conservatism, there are a lot of people who would say, okay, let’s go bet this, let’s figure it out, and it’s a new company, new technology, new idea that they want to try, I will try it. That level of openness of trying new things is not something that I’ve seen in India easily. I’m not saying that everybody’s like that, but India businesses, for example, because it is a B2B that we were running, example, business are very conservative in terms of adopting new things and wanting to try new things. Maybe it’s changed a lot over the last 10 years, but when we went to the US, the most refreshing thing was people are actually lapping up the ideas that we were telling them, saying, hey, when we tell them, they’ll say, okay, wow, let’s try it, we’d like to look at it, and then pay for it as well, right. I think that was a big aha moment for me, at least personally.

Nansi Mishra 1:03:43

And the paying capacity also.

Baskar Subramanian 1:03:44

Paying capacity to really say, okay, let’s take a bet, because this looks interesting, let’s go.

Nansi Mishra 1:03:48

They still see the pricing over the value that they would be getting, right?

Baskar Subramanian 1:03:54

Yeah, see, again, like it’s also about how we are wired economically. If you look at it as in India, we value money more than time.

Nansi Mishra 1:04:03

But do you see that changing?

Baskar Subramanian 1:04:05

It’s changing in the younger folks, but not in the larger businesses yet. We are valuing money more than time. And the vantage point that I’ve seen and learned from the US is that time is more valuable than money. So, I think that’s a big change that I see.

Nansi Mishra 1:04:22

It’ll take some time.

Baskar Subramanian 1:04:23

It’ll take some time, but I think the younger folks understand it, get it. In fact, I’m having a lot of conversations and where we are in our life, for example, I feel money more than that is time is really, really valuable. So, I’m kind of trying to count every minute that I’m saying, hey, where am I spending my time?

Because that’s actually more valuable than the money, right? To be on a point, it doesn’t make sense, right?

Nansi Mishra 1:04:44

You want to add something?

Srividhya Srinivasan 1:04:45

Yeah, one counterintuitive thing I had in the US with this business is that I knew, I mean, yes, after some time when Srini’s presence, we understood that yes, if you show the commitment, people will buy. But then when he was asking for the local team, I thought that it’s global software, it’s a SaaS software, everything can be supported from here. Why can’t you do it? I just didn’t understand that, you know, the nuances of mission-critical software, of how media is treated. That, it took me some time to understand.

Baskar Subramanian 1:05:17

The human touch was needed, independent of, even if it’s a internet-based software delivery, the human touch in an enterprise was something that I don’t think we anticipated, that’s what I should say.

Nansi Mishra 1:05:26

The most important was one founder had to move, that is something you guys already did, right? And the second most was having a local team also.

Srividhya Srinivasan 1:05:35

Yeah, having a local team. I just didn’t understand, it’s software, it’s running on the cloud and you can access it through a website, so what’s the problems? Kind of thing, the naivety I had until I realized that media requires that support.

Nansi Mishra 1:05:48

Yeah, I think all businesses, not just media. And you both have a history of moving long before the market is ready, right? Whether it was Bluetooth in 2000, cloud TV in 2008, what is that one book or technical paper or any post movie that fundamentally shifted, you know, how you’re thinking about the next three years of Amagi, let’s say. How you always make sure that you’re ahead of the curve. So, what helps you guys?

Srividhya Srinivasan 1:06:23

Yeah, I follow Andrew Ng, Andrew Ng he’s called. Basically, he runs a company called DeepMind.ai and he’s a, you should say, pioneer in AI technologies. I mean, I follow the blogs that he writes, the documents he creates and Andrew Karpathy also, we look at it in detail and some of those, the foundational things which were done with transformers and, you know, the ability of large language models and fundamental video models that we saw are the ones which made us feel that, you know, AI is a transformation. Andrew Ng often calls AI as electricity. AI is the new electricity. What can you do with the new electricity is what you should see. And I kept that to my heart, saying that it’s a new electricity which is available to you now. Let’s see what new applications can be built.

Nansi Mishra 1:07:11

Wow. Baskar, you want to add?

Baskar Subramanian 1:07:15

I’m a culprit of, I’ve always been a culprit of always being ahead of what it is. Whenever I speak any idea in the company, people say Baskar’s idea. Okay, two years later, we’ll see. We don’t need to solve it right now. So, that’s been the challenge for me personally.

Srividhya Srinivasan 1:07:32

So, at one point, I had to tell him, like, every two days he will draw some new PowerPoint, a new presentation, right? And say, let’s work on this. So, we have to tell him, stop. We are not able to do at the pace at which you are thinking.

Nansi Mishra 1:07:44

So, after so many years of building Amagi and after the successful IPO you guys had, what keeps you both ambitious? Because you are, you both are so full of energy and very excited that the other kid would also leave the house. You’ll have more time, more bandwidth. And obviously, you guys are so excited about the next phase of Amagi. Right?

Srividhya Srinivasan 1:08:07

So, today morning he was talking about it. Actually, we wanted to work on three things. He was just telling. So, we, in India, especially for India, right? Education. What can you do with education? What can you do with health? What can you do with food? Yeah. Can we contribute in some way towards this before the end of our lives? Yeah. This is what we were thinking. And, you know, we wanted to give, get free education, basically give somehow, enable people to get free education. That is one of the goals. The second one is with food.He’s working on, he invested in some companies and we are trying to get healthy organic food grown in India.

Baskar Subramanian 1:08:48

At scale.

Srividhya Srinivasan 1:08:48

At scale.

Healthy organic, you know, agriculture at scale in India. So, that’s what we are working on. The third one, with respect to health, we want to do something and that’s why he’s studying and he’s learning biology to, how can you marry biology and computer science and build something which is, which can change the lives of Indian people. So, that’s what we are looking at and that’s what is actually exciting. In fact, today morning I was telling him, hey, these guys are no longer going to be here. We’ll get more time. Let’s do more things.

Nansi Mishra 1:09:20

I hope they don’t see this part of the podcast.

Baskar Subramanian 1:09:24

They know it.

Nansi Mishra 1:09:27

What’s that one belief you hold about media technology that most people in the industry would disagree with?

Baskar Subramanian 1:09:33

The Peter Thiel question.

Srividhya Srinivasan 1:09:34

There are so many.

Baskar Subramanian 1:09:37

We’ve always been contra to the business. Now, if you look at it, every time we’ve come with what’s called a counterintuitive approach to this whole business. I remember 2016-17 when we went to the show and we’re showing Cloud Playout. I remember our competition, one of the largest broadcast technology company. I would name them here but I remember a lot of those people were walking around. We were a small booth sitting in that in a show, for example. They said, what are you guys talking about? Cloud Playout? And they were the largest leaders. They said, nobody moves to the cloud folks. You guys are naive. You don’t even know what it is all about. So, that’s where the journey started. We said, no, no, we’ll see. Figure it out. Obviously, then they, this is like what I think the Mahatma Gandhi quote. First, they laugh at you. Then they start kind of fighting with you and eventually, they’re scared about it and then you win.

So, that’s sort of the journey that we’ve gone through this process. So, for me, I think we’ve always taken a counter position in the industry. Whenever something is changing, we are kind of ahead of the change and we try to go back and actually convince our customers that the change is going to happen. First time, people didn’t believe us. But now, we have some sort of credibility in the market to say, okay, oh, these people. So, in fact, this time, people said, okay, what is innovative? What are you bringing to the table? What is new? I think that has been now a practice at Amagi that people are expecting us to bring something innovative and change the industry a bit, right?

Nansi Mishra 1:11:03

So, just one thing, one example, if you can share.

Baskar Subramanian 1:11:07

So, if you look at it, the truth of that cloud will become the way of how you operate television, nobody believed it. The whole industry was against it. There was not even a market study on that, fundamentally. As I told you, competition didn’t believe. Our customers didn’t believe for themselves that they will ever move to the cloud, for example. So, that was a truth that I think we believed strongly, which no industry believed in those days, for example. As we’re progressing, if you look at the next 10 years, for example, the challenge in all of these industries is people, the change that AI is bringing in, I don’t think people understand the magnitude of the change that’s happening. And where these are the exponential changes, like human minds cannot take exponential changes. I’m seeing our customers in the ecosystem again, at a place where they’re underestimating the change that’s in front of us, rather than trying to, they’re hearing a lot of AI, they don’t know what it means for their lifestyles, businesses and their careers and everybody else. But they’re not reacting to it, they think it will go away or wish away that this is yet another automation that will happen and life will go on. But just what I see in our lifetimes, this tectonic change can be transforming everybody and everything, right? Not to be fearful about it, but be able to embrace it in the best way possible.

Nansi Mishra 1:12:41

As another massive opportunity that you saw that time.

Baskar Subramanian 1:12:44

Exactly, exactly. And I don’t think the industry is at a point where they are actually thinking that this change is tectonic. They think it’s a incremental, yes, it’s a great technology change. They’re seeing as a technology change, I see it as almost a human scale change that’s happening, which means the existence of these business in the way they exist, might be challenged in itself. So, there’s going to be several trillions of dollars of businesses which will transform, for good or bad is not a different problem, but at least it will transform. I don’t think that realization is sunk in enough for these businesses to understand the change.

Nansi Mishra 1:13:20

So, a lot of young startups, like how young Amagi was, would be challenging a lot of giants standing right in front of them.

Baskar Subramanian 1:13:29

And again, I went to some of the largest studios right now, right? Studios in Hollywood. So, I was actually walking in this time and I remember going there five years back and feeling in awe with that studio. Wow, what a big studio, what they’ve built, how these movies in Hollywood movies are getting created, the fun of looking at it was like very exciting. When I went this time, I was looking at it, wow, this is all going to become dinosauric because content is going to be created by AI. What will happen to these studios? What happens to all these large infrastructure, the people working there, the whole things that’s happening, for example. So, the emotion was very different when I walked in this time to the studios to see that, right? And I don’t think people there were like realizing the change that’s really in front of us. The tsunami is going to be massive and that’s what I feel.

Nansi Mishra 1:14:20

Okay, this is for you, Vidhya. You founded your first startup when you were 23, right? What do you know now that you wish somebody had told you, like about life maybe?

Srividhya Srinivasan 1:14:38

Earlier, I used to be very impatient. To do all of these patients is very, very, very important. While you can have bias for action, just because you have the bias, it doesn’t mean the other person is going to reciprocate. So, that is something that I learned over time.

Nansi Mishra 1:14:53

Is it a good thing or a bad thing? Basically, maybe you had high bias for action, that’s why you could, you know, take those decisions.

Srividhya Srinivasan 1:14:59

Basically, what I’m trying to say is that things take time and you need to keep trying. And at the same time, there is a nuance, like sometimes it’s not right.

Nansi Mishra 1:15:10

Like believe in yourself, but also have faith in the process. And if Amagi didn’t exist, what would have happened to the broadcast industry?

Baskar Subramanian 1:15:24

I think we at least accelerated the trend, is my feeling. I’m not saying that we are so arrogant to say, oh, clouds do not happen. But I’m sure we were a big accelerator to this industry.

Nansi Mishra 1:15:35

And the last question is, what’s the biggest mistake you have made at Amagi that you’ve never talked about publicly?

Baskar Subramanian 1:15:46

I’ve done tons of mistakes. I’m just trying to figure out.

Nansi Mishra 1:15:48

One you can share that you have not talked about.

Baskar Subramanian 1:15:50

No, no, we have many, many things, right? So, I think if you look at it, choosing India was, in some sense, at that point of time, there was a lot of opportunities. See, the first company was actually international, fully.

Nansi Mishra 1:16:03

Yeah.

Baskar Subramanian 1:16:03

So, by contriving ourselves to a choice of building a technology company in India was, I think, in a decision, hindsight could be said, hey, why did you take a very bullheaded decision to only do it in India, right? At that point of time, and streaming was not happening. Internet was not there. We were taking a bet, which was kind of very odd bet for what we’re trying to do. I think that, in some sense, is hindsight, if you look at it, is a mistake. But, you know, in a larger arc of what we see, for example, I don’t think, because of what we did, was what we could do this, because we learned.

Srividhya Srinivasan 1:16:37

I always used to tell him that because of the kind of effort that we have done in India, when we went to international, any, any change, anything that happened, it is pressure tested. Seriously, I’m saying, even now, I used to tell, even the new product that we released, New Spurs, I was saying that I’ll go and find one Indian customer. It is very important.

Baskar Subramanian 1:16:58

It will battle test you.

Srividhya Srinivasan 1:17:00

It will battle test you.

Baskar Subramanian 1:17:01

So, in that sense, I felt, why should we have spent eight years doing that is a different thing. But, but again, it’s a foundation. It happens. And then we just took it by the chin and moved on in life.

Nansi Mishra 1:17:13

Any advice, because you guys also building in vertical space, any advice you would give to, because a lot of our listeners are founders or, you know, aspiring founders, anyone who’s thinking of building in AI or still in a vertical AI or still in very early stage, any advice you would want to give, who has just started in Bangalore, planning to move to Bay Area, planning to sell to US market, or people who have some customers in India. And sometimes when you get traction in India, you get, you know, attached. And, and if it is the traction is coming inbound, you want to, you know, just be at it, right? That maybe 10 more customers, 10 more customers and you’re just giving them demos and the loop is not ending. You’re not preparing yourself for US market. How to do both or leave everything and just focus on US. Once you have enough traction in US, then focus on India market.

Baskar Subramanian 1:18:13

There’s no one formula that I would try to record because depending on the very situation of the companies and where they are, right? The only way I think I’ve seen or strived for clarity is by saying, let’s take a slightly long term view of where we would imagine, if you’re imagining the future in our minds, that would allow us to kind of take the right decisions in the present. Sometimes I feel that we don’t. So, the first thing I ask my teams is, what do you think will be next April? Let’s close our eyes and say, what would be term is a good success for ourselves as individuals, not as a company or individuals? Do we feel fulfilled at that one time for something that we did for the last 12 months? That allows us to have some sort of clarity to come back, saying, you know what, is this path going to take me there? Or should I do something else, which will actually take me there rather than actually going to embarking the same tree and then trying to do that? That’s been sort of a way to kind of drive a lot more clarity in our minds in terms of what we want to do. The other part is, the slippery slope is, every entrepreneur tenacity matters and sometimes I feel there are a lot of impatience in some sense. So, I see quite a bit of founders who say, you know what, they’ve raised capital, they’ve raised things, but they feel okay, it’s not working and let me drop it and go do something else. For example, there is a balance between when would you want to pivot out of something versus how tenacious are you in that sense? It’s a very, very thin balance. One side looks like stupidity and the other side looks like an epiphany that you have changed, right? So, you need to, that is something always is a very hard problem too. Sometimes you don’t pivot and you’re continuing like a stuff that’s also bad. Sometimes you’re not tenacious.

Nansi Mishra 1:19:56

Sometimes you give that time and then things work out.

Baskar Subramanian 1:19:58

Correct, correct, correct. I think that is a very tricky sort of an environment for founders and that’s where I think external…

Nansi Mishra 1:20:05

It depends company to company like…

Baskar Subramanian 1:20:06

Company to company and external mentorship sometimes helps too. See, one of the things is entrepreneurs get into an echo chamber for themselves and they are kind of fighting the battle every day and then things like that. That’s where I think boards and investors and external bodies can be really good advisors not because they know the business because they are outside the business. The emotions are not connected to the business where you are able to bring very unemotional thought process and get things done. Where entrepreneurs can have a different point of view, albeit sometimes against what you think but at least you know there is other counterpoints that you might want to consider. I think those are ways to kind of take decisions rather than… And I’m not saying always the external body is right or the entrepreneur is right but at least you are able to kind of get viewpoints and get things done.

Nansi Mishra 1:20:54

Very exciting and what are your biggest dreams?

Baskar Subramanian 1:20:59

Because I think we’ve… I truly believe I think we had a very fortunate life. I think from where we all came from and what it is for me is like… I think every day for us has been a… I think I prioritize happiness more than anything else in life. Doesn’t… At every point in time, being happy is so important for me than any other thing. Doesn’t matter. So, success for me is measure of what are we doing today. Am I happy today? And that’s the only way kind of measured life. To that extent, I would think that I think I’ve been extremely fortunate to be where it is and this is the way I kind of imagine myself as if I’m not there tomorrow. I think it’s been a that’s the way I see it. Nothing to look forward to but there’s a lot of exciting things to do but it’s not about being… Fulfilling is today. I think today is really fulfilling. I think what we’ve done and what we could potentially… Obviously, potential always exists in terms of what we can do.

Nansi Mishra 1:21:57

Yeah. Thank you so much both of you. I thoroughly enjoyed this discussion.

Baskar Subramanian 1:22:03

Thank you very much. Absolutely.

Nansi Mishra 1:22:04

Learned a lot of things. Saw the whole media industry from a different lens today and got to live the whole journey of Maggi in just last one and a half hour. Thank you so much for your time.

Baskar Subramanian 1:22:16

No problem. Thank you very much. Enjoy this. Thank you.