Lloyed Lobo, Co-founder and President of Boast.ai, discusses his failures and eventual success building AI startups. Wonderful conversation!
Sramana Mitra: Welcome Lloyed. I’m looking forward to know you and understanding what you’re doing.
Lloyed Lobo: Thanks for having me.
Sramana Mitra: Where are you from?
Lloyed Lobo: I’m a combination of things. I grew up in Kuwait. My parents are from Bangalore. My family is from there. My mom grew up in Mumbai. My dad grew up in Bangalore. I was born in Kuwait and then moved to Canada. I did engineering there. I was a refugee of the Gulf War in the 90s. After engineering, I moved to the United States.
Sramana Mitra: Where are you working out of right now?
Lloyed Lobo: I’m in the Bay Area.
Sramana Mitra: Let’s talk about Boast.ai. What is the genesis? What kind of background brings you to Boast.ai?
Lloyed Lobo: Boast.ai is a FinTech platform that helps companies identify, claim, and finance R&D tax credits and incentives. Globally, hundreds of billions of dollars are given in government incentives to fund innovation. But the application process is cumbersome, manual, and prone to frustrating audits, and it takes a long time to get the money.
What we do is integrate with the company’s technical systems and financial systems to pull that data in real-time through the year to identify what they qualify for and how much they get back. Then, we finance it. So they’re getting more money faster for less time and risk. It’s a different type of non-dilutive capital effectively.
Sramana Mitra: Let me try to re-spin what you said and you tell me if I understood it right. There are tax credits that the government and various agencies provide. They’re very difficult to apply for.
What you’re saying is you look at the company’s financials and other heuristics to figure out what the company would qualify for. Then submit that application based on your evaluation of what they would qualify for. Then finance it and then you get the credit back.
Lloyed Lobo: That’s a fantastic summary. It’s a cumbersome process. If you work with accounting firms, you always look back to figure out what qualifies. Once you file the application, you may get audited. That whole process takes 16 plus months. You have to spend a year’s worth of R&D or product development expenses. We say, “Use Boast. We’ll analyze what you performed in R&D. We’ll figure out what the cost is and how it qualifies. We’ll give you the money now and we’ll take the fee when the government pays you.
Sramana Mitra: I understand the financial signals. I imagine you integrate with the accounting systems. When you talk about R&D assessment, what are we talking about?
Lloyed Lobo: Definitely project management systems. In the tech sense, we look at JIRA and GitHub. People don’t time track. One of the most important things to figure out is who spent what time on these projects. In the product development space, everyone is agile. They’re not time-tracking. We integrate with their JIRA and GitHub to see who’s spending how much time on projects.
We have automation to figure out time-tracking on an individual basis. We look at the projects they’re working, figure out who spends how much time on it, and then map it to payroll. Then we map it to QuickBooks to look at what other expenses they spend money on. It could be local contractors or hosting costs.