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The Funding of Avaz: Some Reflections

Posted on Monday, Apr 21st 2014

By Ajit Narayanan, Founder and CEO, Invention Labs

I started working with children with autism way back in 2008, building technology that helps them learn language and communication. In retrospect, it was almost serendipity – what started as mainly a favour for some friends has now turned into a full-fledged start-up. And today, I’m thrilled to share that TechCrunch broke the story of our company, Avaz (www.avazapp.com), raising our first round of financing, and I wanted to spend a moment reflecting on how my advisors in general, and 1M/1M in particular, have helped me get here.

I joined the 1M/1M program in 2011, about a year after I had released the first version of Avaz. We had built our own tablet then – released a couple of months before the iPad – and I was wondering if there was perhaps a business to build out of this. Sramana’s advice was that I would have much more success with Avaz as a scalable business by converting it into an app. After much prevarication, I decided to take the plunge into the app world; it has borne rich fruit since then!

There are a couple of key learnings I’ve had in the last few years of running my start-up. The first is that neither quality nor innovation is sufficient in itself for a product to turn into a successful company. Most crucial is positioning it with precise segmentation – that’s what helps create a story around the product, and helps differentiate it from competition. A key piece of advice that Sramana gave me was to consider positioning Avaz as an autism-focused product instead of as a generic speech generating device. That has helped us reach numerous children, autism organizations around the world (such as Autism Denmark), and school districts like the LA Unified School District (among several others).

Another key learning is in the context of raising funding: that what a VC looks for in a company is very different from what makes the company successful. I ran Invention Labs as a pretty successful company from 2007 to 2013, if success is measured in terms of growth in revenues and a reasonable amount of profit. Sramana taught me that if I went out fundraising, I would need to tell a much bigger story than revenue and profit for a VC to be interested – I would have to be able to build a compelling case as to why my business would scale to be worth hundreds of millions of dollars. In the process of thinking through that answer, I had a number of revelations that have helped me create a solid strategy for getting to that kind of scale.

I look forward to continuing to work with Sramana to signpost my start-up journey with her wealth of experience in the entrepreneurial world. I value her advice very much, and value the intellectual stimulation that every interaction with her brings.

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