He churned 100% of his revenue on purpose—then grew 10x to $2M ARR in under 12 months. | Ali Khokhar, Founder of Amigo AI

Ali Khokhar (00:00:00) : Validation is dollars exchanging hands. I can go talk to fifty of my friends and be like, what do you think about this idea? And everyone's like, they don't want to offend you. They're like, oh, that's a great idea. Pablo Srugo (00:00:07) : A hundred percent. Ali Khokhar (00:00:08) : And so, I was like, no, no, no, no, no. None of that is real validation. You know, we had forty seven no's straight before our first yes, as an example. It was a lot of like, no, no, no, no, no, and then by the end of the journey, it was like, hey, yeah, I'll wire you the money without meeting you. It was like, I have heard through the grapevine that you have a term sheet or multiple term sheets. I've heard sort of what you're doing. Where do I wire the money? If you cancel out the first $2 million or so, like, first of all, how are you going to attract the world's best AEs to come work for you? The world's best sales team is not going to respect a founder who can't do it themselves. If you're going to bring on an AE and say your one quota or target is $1 million, $1.5 million. If you yourself haven't done that in six months, you don't have a right to say this is possible. You have the ability to do this. Basically, we doubled the company's revenue overnight with one new customer and we're like, oh, great. Yes, we have such a good fit here. Let's go and focus only on that and then we made the hard decision of actually churning everybody else. Fully refunded them, found them a new home, made them whole, but we stopped working with them. Pablo Srugo (00:01:07) : What percent of your revenue was that at the time? Ali Khokhar (00:01:08) : A hundred percent of our old revenue we churned. Everybody, we started from scratch on the revenue side of things and rebuilt from the ground up. But we crossed our previous high within two months and then 5x that, and then 10x that. Previous Guests (00:01:22) : That's product market fit. Product market fit. Product market fit. I called it the product market fit question. Product market fit. Product market fit. Product market fit. Product market fit. I mean, the name of the show is Product Market Fit. Pablo Srugo (00:01:34) : Do you think the Product Market Fit show, has product market fit? Because if you do, then there's something you just have to do. You have to take out your phone. You have to leave the show five stars. It lets us reach more founders and it lets us get better guests, thank you. Ali, what's up, man? Welcome to the show. Ali Khokhar (00:01:51) : Thank you, good to be here. Pablo Srugo (00:01:52) : So you've built, I mean, everybody's talking about AI agents. You've built a platform of AI agents for the healthcare sector. You've raised over $15 million, almost $20 million so far. Just raised the Series A. So we're going to get into all that, what happened, how it happened, all the pivots. All the shit you have to go through to build something like this. But to start off, because this is the Product Market Fit Show. When did you feel you'd found true product market fit, and why? Where were you? When was it? What happened? Ali Khokhar (00:02:18) : One of the biggest deals we ever signed, which was our very first deal. Which was a multi six figure contract, got signed in sixteen days during Christmas and New Year's, right? When the world is asleep, when the world shuts down, generally speaking. They came inbound, and that felt to me like we had struck lightning. Because it very clearly indicated that a fairly larger company, relative to us at the time. Cared so deeply and had such a big hair on fire problem. That their execs were wanting to work through Christmas, through New Year's, in a very short period of time and go through this process with us, and take a bet on a fairly early stage company. That was the first moment, I would say, and then the following three to four months. That feeling of we were closing larger and larger enterprise deals. Pablo Srugo (00:03:07) : What kind of ACV are we talking about? More or less? Ali Khokhar (00:03:09) : We're talking 150 to 300K. Pablo Srugo (00:03:12) : OK, meaningful. Ali Khokhar (00:03:13) : Yeah, meaningful, exactly. As in, you know, we're looking at CEOs are only signing off on this, like this is not bottoms up, there's no PLG, it's pure play. You know, what at the time, for us especially, was considered quote unquote enterprise. We've now moved even more upmarket. But at that moment, that first $240K deal was the largest deal we had ever signed in the history of our company and we had done it in sub twenty days, through Christmas and New Year's. Every few weeks then, we were signing deals like that and that feeling of the market is pulling the product out of you versus you are pushing it into the market. That feeling is very distinct and I started feeling that, over and over and over. And that, gave us the signal that we were on the right track and that we had sort of struck a nerve. In terms of the product and platform, and infrastructure we had built with this really good match in terms of the pain points that a lot of our customers were feeling. Pablo Srugo (00:04:01) : Everybody will tell you that there's no number that indicates product market fit, like when you hit one million or two million or whatever. But when you're signing $100k plus deals consistently, you know, and especially fast paced, and you're just getting through cycles, and it's a high priority. It's almost impossible to not feel like you have true PMF. Because it's just, it's real money. You know, nobody's spending that money unless they feel they really need that product. Which leads me to that question, tell me a bit more about that product at that point. Because I know it changed before. We'll get to that. But at that point, what was the product that you were selling that was resonating so clearly? Ali Khokhar (00:04:33) : Yeah, so we were very focused on, and still are. We think of ourselves and, have sort of framed ourselves as an infrastructure and platform layer to build healthcare specific agents. Especially those agents that were able to perform tasks and work generally that has a high risk of failure, right? In healthcare, there's a lot of back office administrative functions, there's a lot of rev cycle type of building that's happening. We started our journey being focused on patient facing agents. Patient facing agents and what I call sub clinical use cases. Think medication adherence and side effect management. Think post discharge, post surgery recovery, et cetera, et cetera. Where messing up and cost of failure is extremely high. And we had built, and have built, sort of this entire infrastructure deep layer to be able to build and train and quantify the performance of those agents performing that type of work in the world. Pablo Srugo (00:05:24) : And these were voice agents, they would call or text, or email? How would people interact with them? Ali Khokhar (00:05:28) : All of the above, so multi channel, voice, text, email, and then inbound and outbound. So we're reacting when patients are talking to us, we're responding, or we're proactively sort of identifying certain signals that we should be reaching out to those patients and then multi modality, right? Voice and text. So multiple channels, we could be over a phone, in a web app, in a phone app, whatever the case may be. Multiple modalities and then, both proactive and reactive. And so we sort of think of us as the training, the simulation engine, the orchestration engine, memory management, the underlying data platform layer and on top of that, you build these agents across the interaction layer. So think of that as the sort of full deep stack. That's what sort of everybody was gravitating towards. Because most people at that point were also like, I want to own control over how the system gets trained on what is in scope, what is out of scope. Some of the sort of clinical workflows, the clinical intelligence that's taking place. They do not want to just buy that off the shelf, given the nature of the use cases that we had started off with and so there was this really good fit at that moment in time. Where our customers were like, look, I care deeply about how this agent is trained, what the scope is, how it reasons. I want control over that. I want ownership over that. But I'm not going to build and maintain all of the underlying infrastructure to be able to sort of create that. And so it's a really good fit in terms of, you know, everybody talks about an enterprise build versus buy, build versus buy. We landed in this middle ground, which was like, you customers should build at the right layer, but buy a different layer essentially. Pablo Srugo (00:06:56) : You know, you won that because of customization and control. But what would you say was the number one reason why these customers even wanted AI agents in the first place? What, for them, was the obvious problem that this would solve? Ali Khokhar (00:07:08) : I mean, we know in healthcare, there's a massive labor shortage, right? So a lot of them had way more demand than they could handle. They could not hire and train really high quality clinical staff fast enough in order to provide the sort of very personalized, hands on care that they wanted their organization to be able to deliver and so there was this big gap that they were trying to solve for. Pablo Srugo (00:07:27) : And for them, is that more revenue for them? Is that like, what's the business ROI? Ali Khokhar (00:07:31) : It ends up being better clinical outcomes for them. So a lot of value based care organizations want to be able to drive and deliver, and prove some of those things. It ends up being more revenue for certain organizations or preventing revenue leakage in some cases. That's sort of where a lot of folks are focused on, or it ends up being more revenue in the form of being able to handle, you know, 2x the volume of patients without 2x the volume of staff, right? As we know, a lot of these organizations are very labor heavy, labor constrained, and ops heavy. And so they're saying, OK, can I increase the demand side without having to go and find. Which we know is really hard to do so, really high quality clinical staff that is trained up. Pablo Srugo (00:08:07) : And when was this? You mentioned it was December, what year? Ali Khokhar (00:08:10) : So December, January of last year basically. Pablo Srugo (00:08:12) : '24, '25, OK, and when did you start Amigo AI? Ali Khokhar (00:08:16) : The January prior, so this is twelve months into our first round of fundraising and capital. Pablo Srugo (00:08:20) : So tell me about the origin story, now that we know that moment when things started to finally click. There was a year before that where, presumably, it wasn't clicking yet, right? But maybe just start with that. Just a little bit of, not maybe your full background, but right before you started Amigo. What were you doing, and why did you decide to start this business in the first place? Ali Khokhar (00:08:37) : Yeah, so I started my career at Google, spent time there, and then went to a company called Upwork. I was at the internal incubator there, building sort of net new user to one product surface area. Sort of like new bets for the business, new ventures and obviously a lot of the focus, Upwork, world's largest labor marketplace. We started thinking through what does it mean to be able to deliver high quality sort of knowledge work through the form of agents, right? So a lot of my sort of thesis and initial thinking was in that space. I left to start Amigo, which initially the thesis was similar in the sense of, is there really high value labor or knowledge work that is super expensive, super hard to find, supply constrained. That we can build and train these agents for that can then go deliver that quality of work, right? So it wasn't healthcare only in the beginning. That was the more generalized thesis. Pablo Srugo (00:09:25) : You know, that was the wave. I mean, end of '22 is ChatGPT, '23 is people figuring out what AI really is, and '24 is when the wave was actually just starting, I would say, for AI agents. Is that what drove you to say, I got to get in on this wave. I got to do something with AI agents, it's too big to ignore? Ali Khokhar (00:09:40) : For me, it was a month after ChatGPT came out, I started raising the alarm bells saying, hey, what happens to a company like Upwork that is very labor heavy, right? That is a labor market. That was all I was doing all day long, was thinking about that problem space, right? And so February of '23, is when I actually quit my job. Pablo Srugo (00:09:58) : It’s very interesting. You’re literally at the place where it’s probably most vulnerable, because it’s that extra work that you don’t need to hire a full time person for. Throw it to Upwork, throw it to Fiverr, throw it to these places that just get it. It’s the first to go. Ali Khokhar (00:10:10) : Exactly, so I started seeing the writing on the wall. Within a month that ChatGPT came out, you can imagine at the early on there were companies like Jasper that were doing copywriting. If you remember, that was the very first sort of application layer, hot AI startup that raised a bunch of capital. And you could then start saying, OK, well, that's like copywriting as a category, right? And I was looking at Upwork, like a labor marketplace. I'm like, OK, copywriting, a lot of work is software engineering, coding work, a lot of work is design work. A lot of work is, you know, there's a lot of consulting happening and so on and so forth. And so I just started saying, OK, each of these categories is going to get picked off one by one over the next five year window, let's say. And so it was very, very clear and obvious, at least to me at the time. Because it's what? November '22, right? ChatGPT comes out. February '23, I quit my job and I was like, I'm going to go build a company in this space. It was very obvious at that point and so then I spent the remainder of '23, basically formulating, talking to a lot of organizations, understanding how they're thinking about, at the enterprise level. How this technology changes how they complete work, how they do work on a daily basis and so, zigged and zagged in the early days. And found my way to this concept of we're going to go, and create these agents. This platform to allow anyone, solopreneurs included, right? I.e. those who are doing on Upwork, for example, or other marketplaces like Upwork, like Fiverr. Who are going and trading their time for money that are services heavy. That's where the initial thesis was. Can we take somebody who's delivering a services heavy type of product or value, can we allow them to train an agent that they have a lot of control over. Where the cost of delivery is high, they care a lot about their brand, their reputation, and can we allow them to deliver that same value but at a much lower price point, and increase accessibility on the demand side? So that was sort of the obvious problem that I set out to start, and then raised money in January '24, off that and started horizontally. And then over the course of the year, we started feeling a lot of pull and thinking through, OK, as the market evolves, as the world evolves, as the technology gets better. Where is there forever going to be this sort of concept of services heavy, huge constraint on the supply side, infinite demand that is very expensive, right? You can start now seeing why healthcare became the obvious place for us to go land in and, really narrow in and focus on. I also had a lot of personal experience in the space. I have four sisters, they're all in healthcare. One's an NP, one's a pharmacist, one's an RN. My partner's an RN. I lived with her during the pandemic and witnessed her life. A third of her floor, all the RNs and NPs were quitting every six months, right? During the pandemic, and so I had also experienced firsthand through my family, through my significant other. The life of somebody who is a clinical person delivering care and so, that's when sort of two and two sort of hit me in the face of like, OK, we've built this really strong technology that allows us to capture expertise and train these systems and these agents in a very nuanced way to then go deliver high quality services at the time. Let's go and focus in on healthcare only. And that's when we then felt what I was describing of like December '24, January '25 of, oh, we've hit the spark, like such a good fit in terms of the market that we were in, that we started focusing on, where then the rest is sort of history. Pablo Srugo (00:13:17) : Perfect, and we're going to go through. I mean, we're going to talk, you use communities to get your first million in ARR, past that. So we're going to talk about that. We're going to talk actually about how you raised that first round. It's a hundred pitches in ten days. But before we get to that, I want to zoom in on that. You skimmed over this part, and I get why you would do that. You know, from February '23 until you find this first idea, right? In January '24, we call that research mode. This is before you're actually in startup mode, you're building anything, you're doing even the MVP stuff. You're literally just researching. I've done it, it is painful. It's painful for a founder to be there because, you want to start a business. That's why you quit. You want to build something. You want to sell something and you're like doing research and trying to. And people ask you, hey, what are you up to? And you're like, I don't really know. Yeah, you know, I'm just, tell me more about those nine months. Maybe what did you do? Does any conversations come to mind? Anything you remember from that? Because it's critical to do that right. Yes, you'll pivot, but where you start matters, right? You started broad and then you honed it in. If you'd started somewhere else, it's hard to imagine that you wouldn't end up with the Amigo you have today. Ali Khokhar (00:14:19) : Yeah, those are the insane days of just me by myself as a solo founder who, you know, and I come from a non technical background. So I was in growth and marketing, and product. And so, because I wasn't in engineering, I was like, OK, great. What's the only real skill set that I should have is being able to sell, right? Navigate the market, understand demand, and being able to sell. And at the time, if you think back, there's no code, there's no lovable, there's no coding agents. There's no ability to prompt your way into a prototype. This was like old school stuff, right? And so, my entire thesis early on was true validation of demand of an idea is dollars exchanging hands. This was a very, very specific intentional thing I did. I can go talk to fifty of my friends and be like, what do you think about this idea? And everyone's like, they don't want to offend you. They're like, oh, that's a great idea. Pablo Srugo (00:15:01) : A hundred percent Ali Khokhar (00:15:03) : And so, I was like, no, no, no, no, no. None of that is real validation. Validation is dollars exchanging hands. So I was very anchored on when somebody pays me for something, I know that this is a real problem that they have that they're willing to pay for, right? Seems very obvious and simple, but I know a lot of early stage founders. Even friends of mine, get stuck in the trap of, this makes sense to me. So let's just go build it, or I talked to seven people and they said this is a good idea. So it must be a good idea. Pablo Srugo (00:15:27) : It’s because psychologically you just, and I know exactly what you're talking about. You want to go, you don't want to like. You want to let's go, let's sell, let's build, let's get started, and slowing down. The problem is, if you do that and you get it wrong, you will spend years pushing a boulder up a hill. Because you never really got to the moment that you're about to talk about. But yes, it's extremely common. Ali Khokhar (00:15:48) : Exactly, so I'll just tell you the full journey, basically. I left and I had this concept of, OK, agents, quote unquote, that are going to deliver some sort of service. But where do we start? Because again, I come from a background of like Upwork and horizontal. What category should I begin? Is it copywriting? Is that too late? Has Jasper already won that? What is next on the docket? I started by just going to a lot of my smart friends and being like, what are you using ChatGPT for? Very classic, right? To get a sense of like what are interesting use cases that seem very odd at first, right? Because I'm like, it's so early on. I never was like, yeah, copywriting, copywriting. I'm like, OK, cool. What else? And I had a couple of people tell me that they were using it for coaching, like personal coaching, leadership coaching, personal development, health coaching. They were using it for motivation, et cetera, et cetera, and I was like, oh, interesting. Weird, but interesting. OK, let me pull on that thread a little. Pablo Srugo (00:16:37) : That became a huge category, by the way. Interesting. Ali Khokhar (00:16:41) : And I was like, oh, OK. And so then I was like, so who is delivering that service today, right? Well, humans are delivering that pain point. Then I started saying, OK, let me go talk to consultants and coaches generally, like executive coaches, leadership coaches, personal coaches, health coaches, and so on and so forth. So let's go. Now I've figured out, OK, there's this weird use case that people have for ChatGPT that at the time was very niche. Who are the humans delivering this service today? Let's go talk to them and understand their pain points, and is there something for them to be built? And so, then I just started going and DMing coaches on LinkedIn. LinkedIn at this time had this thing called services where you can hire people. It's almost like Upwork-esque type of thing. I just filtered for executive coach and leadership coach, et cetera, et cetera. I DMed fifty people being like, hey, I'm building this AI thing. You can build an AI coach for yourself, train it, et cetera, et cetera. Nobody replied to me, OK, like one out of fifty replied to me and then what I did was, my next batch of fifty, I added a P.S. At the end of my cold note. I would say, P.S., I am also looking for a coach myself, potentially. I'm a new founder and then the next batch of fifty, thirty replied to me. Pablo Srugo (00:17:42) : Nice. Ali Khokhar (00:17:43) : I have you on the call now, and in the call, I would just start pitching like, hey, you know, I've built this product. It doesn't exist, but I would frame it. Obviously, I've built this thing. It works in this way. Is this interesting? Does this solve the pain point? Yada, yada, yada and they're all like, oh yeah, this is cool. Some of them are like, this is creepy. This is weird. What do you mean this AI thing? Get it away from me. You know, this is again still early on and some of them are like, oh my god, yes, this makes total sense, et cetera, et cetera, OK cool. One of those folks from one of those conversations, they're like, well, you're going to be in Florida in two weeks for the world's annual largest coaching conference, right? I'm like, yeah, of course I'll be there. He's like, great, I'll see you there. I'm like, perfect. What was it called again? And I'm in a new tab, figuring out the name, buying flights, booking hotels. So I'm like, all right, let's go. So I book my flights, buy the ticket, show up at the conference and at the conference, it's all coaches and they're all much older than me. And they're all looking at me at every table like, who are you? You're pretty young. Are you even a coach? What are you doing here? And I just started being like, oh, well, you know, I built this company is for coaches. It allows you to create an AI coach of yourself and you can train it. There's a lot of control built into it, yada, yada, yada and instantly I started seeing eyes light up. Oh, that's interesting. I would want that, I would want that and like, how much is it? And I'm like, I don't know. One hundred bucks? Oh, done. OK, easy. I'm like, oh, sweet. Next conversation, two hundred bucks. Next conversation, three hundred bucks, and so on and so forth. Pablo Srugo (00:18:59) : And you're closing them on the spot, or you're getting interest from them? Ali Khokhar (00:19:02) : I'm just getting interest. I'm like, I have a wait list, sorry. Because there's nothing built, by the way. Pablo Srugo (00:19:07) : Yeah, exactly. You're not ready. Ali Khokhar (00:19:08) : Nothing exists and I'm like, oh, sorry. I have such a big waitlist. I'll get you on there, and I'll onboard you in two months. I had one guy follow me around. Every time he would see me for the rest of the two day conference, he'd be like, how about this, pull up your waitlist, show it to me, and I want you to put my name at the top of that waitlist. I'm going to stand here and show it to me. I was like, all right, fine. So I went and did it. I had a fake waitlist with forty people's names on it and so anyway, conference finishes. And I'm like, OK, but still, I don't feel it yet. I don't feel the validation. I feel the excitement, I don't feel the validation. So I did what everybody does, or I think everybody should do. I went, created a Stripe account, and created a one time product on Stripe for $499 one time deposit to build your AI coach on Amigo's platform. And then I sent that out. And three people paid me. So I was like, oh, shit and keep in mind, $500 for a solopreneur is a non, it's not $10, $20. Pablo Srugo (00:20:00) : It's real money. Ali Khokhar (00:20:01) : This is for them real money. This is like, they're only going to think twice before ever putting their credit card in without seeing the product, without seeing a demo, without seeing anything. Just physically me being there and having a quick twenty minute conversation turns into a Stripe link from a stranger in which they put in their credit card and pay me $500, each of them. That then I felt like, OK, I have something here. This is real now. I did the same thing in parallel with a larger enterprise-y coaching organization that was like, hey, we want to build an AI coach. We don't have the technology, we don't have the engineering infrastructure. I was like, oh, don't worry, you can white label my AI coach. I got you and then they were like, all right, cool. Can we see a demo? I was like, yes of course and then I went, and to what degree I want to say this. I don't know, I fully faked it, OK. I went and I had basically somebody, an engineer, go create a local single system prompt that I sent him the single system prompt. I said, record your screen and put in these back and forth coaching conversation about dealing with a conflict with a colleague. Then I went to YouTube, grabbed the voice clip of the head coach at this organization, went to ElevenLabs, cloned her voice, put in each of the snippets that's from the video stream one by one, went to Sony Vegas Pro, stitched it all together, and sent it over as a demo. Pablo Srugo (00:21:13) : You can be jaded about it, but the reality is now you can a hundred percent do it and by the time these people wanted it. You probably could have done it, right? Ali Khokhar (00:21:19) : Exactly. Pablo Srugo (00:21:19) : Now you just get your way to them seeing what you already see. Ali Khokhar (00:21:22) : Exactly right. Now you could do this in literally two minutes, but I was like stitching it together in six hours with this manual process, send it over to them, then went to their leadership team to present and be like, hey, here's what we do, here's who we are and the person whose voice I had cloned was in love. She was like jaw drops, this is the craziest thing I've ever seen. When I played the demo and I heard my voice, I was like, oh my goodness. This is the future and I was like, all right, cool. We want to do a pilot with one of these large organizations, a very large Fortune 100 organization. I was like, OK, great, sounds good and they're like, we'll pay you $1,000 for the pilot, and then we'll do sort of a rev share model. And I was like, $1,000? No, you're a large organization, how about and I was just like, you pay me $20,000 for a three month pilot. And they're like, $20,000? No, no, no, you're too unproven, yada, yada, yada. But we'll pay you $10,000. Pablo Srugo (00:22:08) : There you go. Ali Khokhar (00:22:09) : Here's the wiring information, and they wired me $10,000 the next day. So now I have basically a quote unquote enterprise contract. That was like, we'll buy a thousand seats at X dollar value, yada, yada, yada. Just worth seven figures at full scale, of that $10,000 deposit for a pilot, and I've got four solopreneurs who have paid me $500 each. So I got $12,000 in revenue, and I have not written a single line of code, nor do I have a team, nor have I fundraised, nor do I even have a co founder or CTO at this point. That to me was the early days of like, OK, now I have built a conviction. I am solving a real pain point for people who are paying me real dollars. We have revenue in the bank with nothing to show for it other than just me talking to them. That's what then I went and spoke with a couple of, I was having already conversations, and I convinced my brilliant co founder and CTO now to leave his job at Databricks to come join me. So he quits. We meet in September of '23. We work together for four months. I give him this entire journey, this experience. We start iterating and building for those early customers. Jan, first he quits. Pablo Srugo (00:23:17) : This is Jan what? Now we in what, 2024? Ali Khokhar (00:23:17) : Now we're in Jan '24, precisely. Pablo Srugo (00:23:19) : OK. Ali Khokhar (00:23:19) : It joins me full time. Now, basically, we start going and fundraising. Pablo Srugo (00:23:24) : OK. Ali Khokhar (00:23:24) : Jan 15th, we kick off our fundraise and we pitch a hundred investors in ten days flat. Pablo Srugo (00:23:29) : You love this show. You don't want to miss the next episode. Why would you? So hit that follow button. Trust me, it's in your own best interest. We're going to break that down. But I think one of the things I just want to point out is so nine months effectively invested in true validation and I think the way that you did it is, I mean it's in a sense it's like textbook classic. But it's also, for some reason I think it's just because it's hard. Most founders are still these days today, right? Don't do, like lean startup is an old idea, right? You think people will be doing this, but still many people I think don't do it and this is also what, you know, bootstrapping is typically when you don't do it funded. But this to me is bootstrapping in the sense that you kind of like fake your way to the first thing so that you can. How do you get a great co founder? You show them some traction, right? And how do you get capital? You show a team and some traction, right? And then once you have those three, you use it to get more traction and you clear this virtuous loop. But you have to get the thing spinning and, you know, getting people to buy in and validate through real dollars is, to this day, I mean it's just, it's the best. It's the most proven way to know that you're going to build something that people want, which is the foundation of startups. Ali Khokhar (00:24:36) : Exactly and that Feb '23 to December '23 journey was purely focused on that. And even all my founder friends today who recently have quit, to your point. Still got into the trap of like, I talked to ten people, they love the idea, let's go. I should go raise, right? I'm like, no, no, no, no, no. Because the opportunity cost is high too. It's like, yes, everybody's like, yeah, let's go raise and get some capital. OK, sure but if you truly, truly inherently don't feel that there's value in building this and you don't care about sort of this type of opportunity, et cetera, et cetera, it just becomes a lot harder. All the struggles you'll deal with, it's a lot easier to give up and your opportunity cost is enormous, right? I'm going to invest a seven to nine month window in validation so that the next five years. Pablo Srugo (00:25:20) : Exactly, because the most dangerous mix is something people don't really want with a founder who's tenacious, relentless, won't give up. You get that, you get five years away. So you get a bad founder, a weak founder, they'll give up in two months or whatever. No big deal, but that mix is deadly. So let's move on to now, we'll do the two segments. The first one you already alluded to, a hundred pitches in ten days. Let's start at the beginning of that. First of all, it's a pre seed round. How much are we trying to raise? A lot of people for pre seed specifically, they'll just meet like five VCs and get a million bucks and call it a day. You made this a process. How did you think about it? Ali Khokhar (00:25:52) : From the beginning, it was the specific partner that I wanted, and how do I go find that person? And to your point, everybody's in the camp of, OK, cool, let's just talk to ten people. If this thing is real, they'll give me capital. No, that's not at all how it works. Because a couple of things. One is the partner that you're looking for, you might not meet them until pitch number sixty. That was actually the case for us. I did not meet the person who I was like, this is the person who I want to be on my cap table. I want the first check from. Pablo Srugo (00:26:18) : You didn't know, it's not like you knew I wanted this firm. You're just like, I'm going to meet a lot of people until I meet somebody that clicks. Ali Khokhar (00:26:23) : Precisely, exactly and everyone does the thing of like, here's my spreadsheet, here's all the firms, here's where I really. My dream firm that I want to raise from, et cetera, et cetera. But I think early on, none of that matters because if you're crushing it and if you're real, and you're growing. All those firms will want to write checks into you eventually anyway. The most important thing that matters is who are the early folks who are betting early, who are betting on the team, who will stick with you as you pivot, right? Because again, they're betting on that team more so than anything, who you have a really strong relationship with and the connection is there. And aren't just like, you know, yeah, cool, I like this space. I'll dump like a few checks into this space and see what happens, right? Because then when you pivot, it's not a good fit anymore if you end up pivoting. Which most companies end up doing to a degree, right? Pablo Srugo (00:27:03) : Yes. Ali Khokhar (00:27:05) : And so yeah, for us it was a couple of things. One was I wanted it to be concentrated in a short period of time. Because the core business is actually going and getting more customers and building product, et cetera, et cetera. So I did not want to fundraise for four months straight. I wanted to do it in a very short sprint and then two, I don't come from a world of really strong connections. So I'm not like, I spent two years at some VC firm, I then went to Stanford MBA, and then now all my friends are at this firm. So it's easy for me to go and have the ten conversations. I come from, you know, I'm Canadian. I'm not even from the States, right? So coming down to San Francisco and working here was a new experience for me. Pablo Srugo (00:27:38) : It’s good because it’s more, you know, sometimes I talk to founders sometimes. It’s like, oh, I raised a $10 million seed. Oh, well, I already knew ten VCs from my past. I’m like, all right, I can’t learn anything from that. Nobody can learn it. So this is much better. Ali Khokhar (00:27:49) : Precisely, exactly. I effectively did not know anybody in the space and so I was like, well great. What am I going to do? I did what I did the first time around when I was validating my ideas. I was like, let's go talk to folks. But talk to them in a very concentrated period of time with a well scoped thing, with a good sense of, here's who we are, here's what we're building, here's a long term vision, here's why it's exciting for us, and do we have the alignment or not. And so, we went through the sprint, flew to New York, stayed at a tiny, tiny bunk bed style situation. Because again my partner and I, we haven't raised anything at this point, and basically just spent nine a.m. to five p.m. pitching, five p.m. to midnight building. So we continuously would take the day's feedback and learnings of what are interesting demos to showcase some of what we're saying, right? John and my CTO would basically start building after dinner, I would pitch all day, and we'd talk essentially. You know, fourteen, sixteen hour days with no sleep and we just went through the cycle for two, three weeks straight. At the end of which, we then went and got multiple term sheets, ended up with a partner that we really, really wanted, our top choice partner. We got a really good fit for them and then started. And once we closed that round, we ended up then, everything suddenly done, legal, all that good stuff. The round closed five days before my one year anniversary of quitting my job. So it was like a full, almost end to end one year journey from the day I quit and I actually, you know, I have an immigrant dad who was like, what are you doing? Why are you quitting? Pablo Srugo (00:29:08) : Right. Ali Khokhar (00:29:10) : You know, you're on a visa. We're going to lose your TN visa in the States and are you kidding me? At the time, if you also remember, February '23, layoffs happening, interest rates rising post work era. It was a very chaotic world. Even my two previous managers were like, are you insane? This is the worst time to quit. What are you doing? I was like, no, no, no, I'll figure it out, don't worry. What's the worst case? In a year, I'll go back and try to get another job. Like, OK, no big deal. But I want to take this thing right now and so I told my dad, I was like, give me a year. If in one year I can't figure it out, I'll think about what's next. Am I in the wrong space? Am I like fit out, cut out for this? You know, have I spent the time validating the thing I want to build? If I don't get to conviction on something, it's fine. You know, I'll try to get another job. It's like not the end of the world. I've done it a couple of times now and so, that five days before the one year is an important milestone for that reason, because I had mentally given myself a year to ideate and come to conviction. And I already had some initial signals based on my previous roles. But yeah, when the wire hit for that first pre seed, five days before the one year, I went on a walk with my immigrant dad. I was like, look, it's real now. Pablo Srugo (00:30:14) : It's crazy how the power of deadlines. We'll go through a few deeper questions on the fundraise process. The first one is, the hardest part, I find of trying to run a tight process is. In the first place, just getting the meetings, right? It's easy enough, obviously. You go online, you find a bunch of firms. Today you ask Claude, he'll spit out one hundred and fifty names. That's the easy part, is building a list. Did you go cold? Did you get intros? You weren't really well networked. How did you do those initial reach outs to whatever one hundred firms or however many it was? Ali Khokhar (00:30:45) : I would say it was eighty percent through warm connections and so yes, I personally didn't have the network. But I had built enough of a friend group, a network, a professional network. Where I could ask and, I had built enough trust and credibility with those folks who were then willing to make intros for us. Pablo Srugo (00:31:04) : And how did you do that specifically? Did you just go out and be like, hey, who do you know that you can introduce me to? Or did you do the work of saying like, I see you're connected on LinkedIn with X Y Z firm, can you make the intro? Ali Khokhar (00:31:13) : It was a lot more of like, here's the people that I want to go meet. Who is connected to those people that I know, either through first or second degree connection and then, you know, giving them, doing all the hard work of creating the blurb for them, forwardable emails, yada, yada, yada. Having a spreadsheet, mapping things out. Tactically, of course, that's just baseline, right? We did all that good stuff and then used a lot of sort of, can I get in front of somebody? Again, I don't personally know them, but part of it is this, right? As a founder CEO, you're selling. That's your only job. You're selling to candidates to come join you. You're selling to investors to believe in your vision. You're selling to customers and so part of that is finding the right way into those conversations where you come into them with some level of trust and credibility built up, right? And so I found that doing it this way was much better than cold outbounding. Pablo Srugo (00:32:00) : I'm a big believer that these, especially these early rounds. But potentially all fundraising rounds are fundamentally about FOMO. That is just the number one driver of getting a round done fast, on good terms, and ideally with people that you like and believe in. Whether you build relationships before or not. You still need FOMO to just get that deal done quickly and if you come in cold, it's just going to be hard to get the response rates you want. Get the attention level, even if they respond. Maybe it's in three days, maybe they put you out in two weeks, you know, you're not prioritized. Whereas if you come in warm, and ideally in a perfect world the person making the intro is saying not just, hey, here's somebody raising. Like hey, I know Ali, he's a really solid founder, you should really meet him. They're putting that social cred behind you. It's just way easier to kind of build momentum and get one hundred meetings in a week or two versus in a, you know, stretched out over two months. Ali Khokhar (00:32:51) : Yep, exactly. Yeah, the FOMO thing is real, by the way. The second we had our first term sheet, everything else fell into place. Many people came. The craziest thing I'll say is I had people cold, like investors, cold DM me on LinkedIn saying, hey, I heard you got a term sheet. I will also contribute $150k. Pablo Srugo (00:33:11) : This is for your pre seed round? Ali Khokhar (00:33:13) : This is now for my pre seed round. Pablo Srugo (00:33:14) : It’s the power of FOMO. I just want to point that out. You are at this point an unproven founder. You have basically no traction Ali Khokhar (00:33:20) : That's right. Pablo Srugo (00:33:21) : And VCs are DMing you, please let me into your round. Ali Khokhar (00:33:23) : And they're saying, I don't even need to meet you, by the way. It's like, I have heard through the grapevine that you have a term sheet or multiple term sheets and you know, I've heard sort of what you're doing. Just, I don't need to see your deck. Just, where do I wire the money? It was insane to me. Somebody who was like, at the beginning of the fundraiser, like, I don't really know anybody that well. How am I going to be able to do this? You know, we had forty seven no’s straight before our first yes, as an example. It was a lot of like, no, no, no, no, no, and then by the end of the journey, it was like, hey, yeah, I'll wire you the money without meeting you. Pablo Srugo (00:33:56) : one eighty, yeah. Wait, where were you two weeks ago? Ali Khokhar (00:33:59) : What has possibly changed in the two weeks? Nothing other than, to your point, FOMO. Pablo Srugo (00:34:04) : Well, you know, just to kind of give some of the perspective of what's happening here. Because it's easy to just read this and say, wow, VCs are pretty dumb, like lemmings, you know, and there is maybe some truth to that. But what's happening behind the scenes is, as a VC, not getting into the thing that becomes huge is so much costlier than losing the $150k that you would have put in and not going to zero. Because you really need these outliers and at pre seed, frankly, there's just not that much. You have every pre seed has no revenue and so you don't have that many signals that you can, like you can't DCF it and make your own first principles analysis. It's not that easy. So for better or worse, when something gets hot, that becomes a signal in and of itself. And all of a sudden it becomes, well, if other people like it, maybe it is really good. And then you kick that FOMO away to where it's like, shit, if I don't put in $100k and I miss on it. And it becomes a huge thing, I've lost out on so much money. And you get that kind of FOMO tailwind, right? So the other thing I wanted to ask actually about was, because we've talked a lot about fundraising with many different founders that come. Obviously process is always the thing, FOMO's the thing, but what? As you go and you have these one hundred conversations and you mentioned forty seven no's, I'm sure you iterated and changed it over time. What are some things that you feel you learned when it comes to pitching VCs that maybe if you would have known on day one of doing this, you would have gotten only twenty no's up front, you know what I mean? It just would have made the conversion a bit higher. Ali Khokhar (00:35:27) : Yeah, I mean, this is the challenge, right? So, I actually think there is this thing of VC product fit or VC company fit quite a bit. Where there was some folks that I was pitching where they have written off a certain space in their mind and it just does not matter, who you are and what you've built. If they don't have any thesis or any goals or any desire to invest in a specific space, it really doesn't matter. You can start disqualifying some of those before meeting them. So you can turn the forty seven no’s before you get your first yes into ten no’s maybe, right? Because there's a bunch of them in the middle that would have said no, no matter what and can you identify those signals early on? And like all VCs nowadays will write, you know, substacks or on Twitter and they'll tweet things like, I have this thesis in this space, and here's what I believe is happening, et cetera, et cetera. And so, if you can find those people who already believe that there is a big company to be built in the space. Then that makes your job much easier because now you just need to convince them that you are the right people to build that company. Whereas in some cases, I was having to first educate the VC. Here's, let me tell you about the space. Why this is an interesting space to invest in right now? Why is it massively going to change right now? When I say services being delivered as software, what does that actually tangibly mean? What are insights that I have? There's a lot of education that you can end up doing on things before you even get to, here's who I am and here's what company I'm building. If you can skip those, if somebody comes in being like, yeah, I know there's gonna be a massive company in this space. Just tell me why I see you. Very different conversation. So there's sort of this fit thesis piece that I think a lot of people, or at least early on in the first time I had fundraised, I was not doing at all. After that, I started doing a lot more and it just made our life a lot easier as well. Pablo Srugo (00:37:09) : Perfect, so that's the fundraising kind of segment and then the other thing we were going to talk about was you got your first million in revenue through communities. Tell me about the thinking behind the strategy and then we'll get into the tactics of how you build communities and make that drive sales for you. Ali Khokhar (00:37:27) : So once we narrowed in our focus and realized we want to go all in on healthcare specifically, where there's a lot of opportunity, my cofounder and I care a lot about the space. And so we're like, OK, let's go do this. But again, the challenge we had was we don't come from a healthcare background, right? And so we're not like ex MDs who spend five years at Citiblock as an example, or One Medical, or whatever the case may be. To then say, look, we already have such a strong network of other healthcare operators, founders, C suite execs at hospitals, et cetera, et cetera. That we could just go sell to them, and so what I then ended up doing was I basically joined a couple of healthcare centric communities with the goal of saying, hey, I'm here as a newer healthcare founder to learn about the space, everything I can and I have a thesis, and a vision, and I am building a company. I'll be upfront and transparent with you on that front. But I want to understand and hear from you, what I'm building, does this make sense for you or not? Sort of what I did with coaches early on, but through specific communities this time around and oftentimes then those conversations would say, wait a second, I'm a founder of a healthcare startup, or I'm working at this health system, whatever the case may be. What you're describing, we have a need for it and so then it was almost like I wasn't being very salesy or pitching them “buy this product.” I was saying I'm newer to this space. Here's my current thesis. Help me formulate and see are there blind spots in my vision. That then would translate into actually I have a need for your product. Are you ready for me to buy? And then that's where we got our first million of revenue. And that's also not the signal of everyone else like you're pushing a boulder up a hill, eventually the market starts pulling from you, right? I could feel the market pulling the product because I didn't need to be salesy to get to our first million. Folks were like, I need that thing. How do I sign up? Where do I sign up? How much does it cost? The conversations went in that direction from them asking it versus me forcing it. Pablo Srugo (00:39:13) : So maybe give me a example of, you know, because I think building through communities. I hear a lot of founders talk about it and I think very few founders actually do it properly, like make it work for them. Tell me maybe an example of a community that you saw, how you actually penetrated, how you post consistently, right? In order to drive traffic. It's easy enough to go on Reddit, find a forum and make a post, but that's one post, right? How do you make this something that you can do recurringly and then get a million dollars in revenue versus just one or two customers? Ali Khokhar (00:39:43) : Yeah, we focused on paid communities. So we did not do something like, I don't mean Reddit or subreddits, et cetera. I mean closed paid Slack channel communities or things like that. Mainly because we found that if you're paying to be part of this community, there's like a higher bar to cross to join and people will also be more responsive, and active if they're actively paying for it, right? And the first community I joined was like $20 a month subscription. Pablo Srugo (00:40:09) : And this is a community of who, for example? Ali Khokhar (00:40:11) : Of just healthcare operators. It's very specific to the audience that I was going to. Pablo Srugo (00:40:16) : And you just go, you just search healthcare communities, whatever? You just look through them, start finding them, or you ask people in the space what's really good? Ali Khokhar (00:40:22) : We asked people, exactly. At the end, I would look at you and I would ask, are you part of any communities? What newsletters do you read? What media do you consume, right? Because I'm like, where do my people hang out? That's basically what I'm trying to understand and I came across a community that was like $20 a month, paid community. It was a Slack channel. I was like, OK, cool, let's go join it. I went in there, introduced myself, started DMing a few folks working on interesting things and then, basically went and started having the conversations there. Some of the folks that I closed that were in that first million dollars, I initially met through there, and then I invited them to a conference that we were hosting or sponsoring two months from then. And then I was posting on LinkedIn. I'll give you one example. That founder then bought Amigo, right? It was like a $200k plus deal and again, we didn't go at it as like, hey, buy my thing. It was purely like, you're building something cool, we're building something cool. Let's chat founder to founder. Pablo Srugo (00:41:09) : Because they're building what? They're building their practices? When you say they're building something cool? Ali Khokhar (00:41:13) : They're building practices or consumer facing digital health company. Pablo Srugo (00:41:16) : Got you. Ali Khokhar (00:41:17) : And so I was like, OK. So I had the first conversation and then they came to the event. And they saw me speak on one of the panels. And then they saw a couple of my LinkedIn posts that popped up, and brought me back to the top of mind for them. And then finally a month later, after three months end to end of multiple touch points. We met them at two conferences, had two virtual conversations. They saw two of my LinkedIn posts that resonated with them that they actually purchased. So it's not like, hey, I'm just going to cold DM, have a conversation and we're done. It's more like you still have to do the relationship building. But the initial entry point that came in was, hey, I'm in this community. You're in this community. We would say it explicitly. I found you through this paid community that we are part of. It's not like a random cold DM. I saw what you're building, I think it's interesting, I'm building something interesting, would love to pick your brain. That specific was the campaign that we ran from this one community in a very non salesy way that led us to eventually close a million dollars of revenue and the total cost was literally $20 a month. Pablo Srugo (00:42:15) : This is what all the, whether it's the community or the events any of these things are just a way to help them filter out, right? If you run a cold email outbound campaign of which you can do and I just had a founder on here that's how he got his first million but it was half a million emails for one percent response. I mean that's what you, and so if you have unlimited like if you're a horizontal product and in this case it was customer success, right? It's like, OK you can run that you can do that. But if you have any sort of virtualization you just can't afford to have only a one percent conversion because you'll run out. So how do you get it to ten percent? And the way you get it to ten percent is, if you think about it on the receiving side, is you have to make yourself jump out somehow. You've got to just be like, oh it's not just another cold thing there's some sort of filtering. So just being able to say, I'm part of this community, from the universe of whatever infinite number of people you've gone down to the one thousand members in that community, you've filtered a lot. You show up at an event, at a conference, same thing. That conference is going to have hundreds, maybe thousands of attendees, but not tens of thousands, not hundreds of thousands. So you're just helping them. You're just trying to find ways of how do you filter out for your customers so you're not competing with everyone, you're just competing with a subset. And then your conversion rate will dramatically improve, assuming that of course you validate it and you're solving a problem that's actually, you know, that they want solved. Ali Khokhar (00:43:37) : Exactly, to give you an idea of scale and numbers, right? This community has like two thousand people in it. When we filtered down to the folks we actually wanted to speak to, it was like two hundred. That's it, it was tiny. It was a tiny group of people and so our conversion rate could not be one percent, right? It needed to be much higher, but it was able to be much higher because it was so targeted, so focused, and things like that. And nowadays everyone's like, you know, like AI SDR-ing basically, right? And you can't really do that at scale in enterprise. Relationship building is so important. Especially when you can't do it when you have no brand, no credibility, you know, you're fighting your first set of customers to make a bet on you. It just needs to be done in a very thoughtful, intentional way and it has to be done by founder and CEO. I've told also everybody I've spoken with, you should sell the first million. In my case, I sold the first two million myself, personally. If you can't sell the first two million yourself. First of all, how are you going to attract the world's best AEs to come work for you, right? The world's best sales team is not going to respect a founder who can't do it themselves. If you're going to bring on an AE and say, your one quota or target is a million, a million and a half, if you yourself haven't done that in six months, you don't have a right to say this is possible, you have the ability to do this. It's very different when founder CEO does it, and it's very important that founder CEO does the first X million themselves before then building out a team. Because also you lose all the learnings, what resonates, what doesn't resonate. Those first batch of conversations that result in the first million of revenue is the foundation on which you set your vision, your story, your product roadmap, the way your narrative, your entire GTM engine, the people you hire to sell, everything comes off of that. So it just becomes so, so, so critical beyond just like, yo, look, I've got a million dollars in revenue. It's like, no, no, no, I've built a foundation to get to ten, which will then get me to a hundred, which will then get me to a billion. It's all systems building, right? Pablo Srugo (00:45:26) : Plus it's a place in, you know, the head of sales is the first one to go and it's the most turned over position. It's the one place you need to be able to say, I know this person's not doing it right because I've done it versus always being guessing and then it's just you wasting months, and quarters, and you don't know, is it the product? Is it the marketing? Is it the sales? You just have no idea because you haven't sold that million yourself. Ali Khokhar (00:45:46) : Precisely. Pablo Srugo (00:45:47) : One thing that we didn't touch on is we talked about the beginning, you were kind of horizontal play by product market fit. You were focused on, you know, the healthcare and we mentioned pivots, right? Tell me a little bit, because I know that there was a big kind of pivot moment. Tell me about maybe the before, during and after of that story. Ali Khokhar (00:46:04) : Yeah, so it was a couple of things that caused us to do this, and this is the other thing, is this even a pivot or is it a narrowing of focus, was slightly different, right? Pivot, you could say the Slack story of like, oh, we were trying to build a video game and then we're like, hey, we're doing. Pablo Srugo (00:46:17) : Yeah, that's the big, big pivot. This is like a small, within pivot, yeah. Ali Khokhar (00:46:21) : This is the core thesis of, hey, we can build AI systems that capture really good expertise that can go and deliver service heavy workflows in the form of software with a high degree of quality. That thesis foundationally stayed. Initially, we were serving both solopreneurs, SMB, and enterprise, right? So we're serving a very different set of customers and then we were layering on a second layer of complexity, which was really getting leadership exec coaching, we were doing consultants, marketers, we were doing a little bit of health stuff. So it was just all over the place and so we then said, OK, a couple things happened. One was I saw the path actually to $10 million of ARR in that old world. I stopped seeing the path to a billion run rate, and so it was like I felt like we were climbing a hill and the top of that hill wasn't the end state we wanted to land in. And we were still a baby of a company. So we could have kept going. It was working, it wasn't like it stopped working. Pablo Srugo (00:47:14) : You were doing how much in revenue? Ali Khokhar (00:47:16) : We were doing just under $200, $300K of revenue. Pablo Srugo (00:47:20) : OK. Ali Khokhar (00:47:21) : But for entrepreneur, ACVs are $5,$10k, and so we were just servicing that archetype of customer, generally speaking. And we're like at a few hundred thousand, we had raised our seed round. And we're like, OK, cool, let's go get to two, three and raise an A and then we'll try to get to ten and so on and so forth. But again, going back to if my co founder and I lose the conviction that this is a $10, $50, $1 billion outcome, even if there's still a lot of room to go, right? Even if like we're at the beginning of a hill, it's still a hill. As soon as you see that end state being t$10 to $15 million of revenue, not $500 million or a billion of run rate, then now it's opportunity cost. Now we're wasting everybody's time. We're wasting our time. We're selling a story to the world. We're sharing a story to the world that we no longer believe in, right? And so that obviously was a very big moment. The other thing we started realizing also was we had just built a more enterprise grade platform that a lot of our earlier customers were only taking advantage of ten to twenty percent of the actual machinery we had built. It almost felt like at some point we started selling a tank to somebody who wanted a bicycle. And we're like, why don't we just point our machine to people who want to buy a tank? Essentially exactly what we have actually built and so that's sort of where we were sitting was we looked at our customer base. We're like, this tiny sliver actually is the future of the company and we can build a large business here that is interesting, that we care a lot about, that we personally have a lot of deep conviction in. That a lot of our team members have a lot of deep conviction in, that we have personally seen the pain points consistently around. But the core thesis is also consistent. It's not like we're full one eighty-ing. The core thesis of service is heavy, supply constraint, high quality is important, high risk of failure, like let's go build AI systems or agents. None of that. Pablo Srugo (00:49:08) : Was there a customer or conversation in healthcare that you saw that was telling you that that was the one and not the others? Ali Khokhar (00:49:14) : Yes, a lot of health coaches started coming to us and then that customer that, you know, bought us during that Christmas break. Pablo Srugo (00:49:21) : That $10K enterprise, yeah. Ali Khokhar (00:49:22) : That was a $240k deal, essentially. Basically, we doubled the company's revenue overnight with one new customer and we were like, oh, great. Yes, they see the long term. They see that we have such a good fit here. Let's go and focus only on that and then we did the hard decision of actually churning everybody else. Fully refunded them, found them a new home, made them whole, but we stopped working with them. Pablo Srugo (00:49:46) : What percent of your revenue was that at the time? Ali Khokhar (00:49:49) : Well, a hundred percent of our old revenue returned, everybody. We started from scratch on the revenue side of things and rebuilt from the ground up. But we crossed our previous high within two months and then 5x that, and then 10x that. And so the bet that we had made, the hard decision, worked out very quickly. And again, that's when I started feeling the pull from the market, was when we narrowed the focus and went to enterprise. Pablo Srugo (00:50:11) : Was that hard to sell? Like, you and your founder? You and your co founder to align it? Was it hard to sell to investors? What was the hardest part of having to churn out? You know, today you're like, well, it's $200k in revenue, whatever. But at the time, it was one hundred percent of your revenue or eighty percent. It's, you know, it didn't come easily. Ali Khokhar (00:50:28) : You know, I'm really, really fortunate that it was not hard with my co founder. We were very aligned very quickly. We were just in sync instantly. We did not even have to debate too much or argue too much about this decision. We were very quickly like, yeah, this makes a lot of sense and we were very open with our team as well. We're very open and very transparent with our team around here's what we are thinking right now. Here's what's working. Here's what's not. We actually did a forty five day sprint to make a decision on a pivot. We did it very openly and we, again, fortunately have a really strong founding team who all believed in us as leaders and understood the nuances, and the pros and cons. And how we're thinking about things. And investors, again, we were lucky because they were just like, we bet on you two. That's the whole reason why we bet on this company is we bet on you two. So if you truly believe this and we understand the logic and how we're thinking through this, we're in. So it was not actually quite hard to do this, which was the very, very fortunate part, I think, for me. Pablo Srugo (00:51:22) : We'll end it there. I'll just ask one last question we always end on. What would be your number one piece of advice for a founder that's kind of in the pre seed, seed stage, finding product market fit? Ali Khokhar (00:51:33) : Validation only happens when dollars exchange hands. Period. Full stop. It does not matter. There is no other explanation or excuse other than that. That's one, two, your co founder is so, so, so important. I went and lived with my co founder in a tiny studio, had breakfast, lunch, dinner, spent 24/7 together for a few weeks. Worked together for a few months before we went all in and made the decision. From CEO to CTO, the way I think about it is your CEO needs to be able to sell anything your CTO can build. Your CTO needs to be able to build anything your CEO can sell, and as long as those two things are true. There's a really good match and you can go build a massive company. And I think that becomes very important as you think about who is your co founder, who is going to be there ten years from now. Pablo Srugo (00:52:14) : Perfect, man. Well, dude, thanks for sharing the story. I think a lot of value is transferred to founders here, so appreciate it. Ali Khokhar (00:52:20) : Of course. Thanks, Pablo. Take care. Pablo Srugo (00:52:23) : So picture this, it's months from now, years from now, and one of your founder friends. A really close founder friend of yours, guess what? Their startup went bankrupt, and it turns out, if you had just shared the Product Market Fit Show with them. They would have learned everything they needed to, to find Product Market Fit and to create a huge success. But instead, their startup has completely failed. You have blood on your hands. Don't let that happen. You don't want to live like that. It is terrible. So do what you need to do. Tell them about the show. Send it to them. Put it on WhatsApp. Put it on Slack. Put it where you need to put it. Just make sure they know about it and they check it out.