How to pull off the ‘zoom-in pivot,’ and other lessons in early-stage building with Luminai’s Kesava Kirupa Dinakaran

Todd Jackson: Kesava, welcome to the show.

Kesava Kirupa Dinakaran: thanks for having me, Todd. Excited to be here.

Todd Jackson: So can you tell us a little bit, about your personal background and some of the different pieces that pushed you towards the founder path?

Kesava Kirupa Dinakaran: Absolutely. So I grew up in the southern part of, India, and most of my sort of, generations of family, grew up on a coconut farm. For a long time, the sort of exposure or the kinds of things, that people within my family or within my community did, was very different to the world I'm living in today.

And so when my parents actually moved up to Chennai, which is the capital of, the state I'm from back in India. I stumbled upon Rubik Cubes and that was my first, interaction with, something that was maybe very unfamiliar to the community I'm from. And, it'll make sense when we go dig deeper, but, I'd walked into my, first ever sort of Rubik's cube competition cuz I had learned how to solve it from a friend of mine.

And, this was a competition that was, in one of the, I, its, in India and it's a, it's one of the sort of national technological universities, and. When I walked in, I walked into this room fiddled with CEOs and musicians and artists and engineers and doctors, and was like, whoa, I guess I can do like other

Todd Jackson: How old were you at the

Kesava Kirupa Dinakaran: I was, 11 years old, so just I was like seventh grade, that was the first time I was like, okay. So all these things that I'd learned, I was like, that's like maybe 0.0001% of what the world had to offer. And when I saw these people I was like, oh my God, these are people who are pursuing things that I've only seen in like movies.

And eventually got very into solving Rubik's cubes as I got closer and closer to the community. And that was my sort of journey into, at least learning something about tech and entrepreneurship.

Todd Jackson: And then what was it that initially brought you to the us? When was that?

Kesava Kirupa Dinakaran: Yeah. Basically Rubiks Cubes kind of the Indian government and a bunch of other sort of communities had funded me, or sponsored, some of my trips, abroad. So I'd gotten to go to the, world Rubiks Cube championships and, and I'd, I got the chance to captain the Indian National team.

And so got to travel across, some of these countries and, ended up going to this sort of high school called United World College. And it's this high school that brings together, people from 70 different countries to work on international peace and understanding. And I got into this, full scholarship to go there and it was not because I was good at schools because of this Ruby Soup stuff and, this whole,

what was interesting about the Rubik's Cube was what was interesting about UWC was the whole mission of the school was to promote peace. And, so I'd, decided to, right after I graduated from high school, I'd taken a gap year, because I didn't end up getting into any of these American colleges that I applied to.

So I wanted to live this United World College, mission of peace. And so ended up cycling from Europe, to Asia to promote this mission. And there was this foundation in New York City that sort of cut wind of it and then said, we'd love to fly you out for this like 10-day social entrepreneurship program.

And that was kinda the first time I ever came to the US back in March of

Todd Jackson: Wow. Okay. And so when you came to the US in 2019, like my understanding is that initially you were living in a hacker house and getting by and living off of hacker money, and hackathon winnings. What can you tell us about that story?

Kesava Kirupa Dinakaran: so when I first came to the US right? I'd come for this program, and I knew I was interested in tech. I planned my sort of return flight from San Francisco. And so I'd come out, to, to the, to Silicon Valley. And when I came here I was like, oh my God, these are like my people.

And I started to feel like it, it truly felt like home in so many ways cuz, people would be thinking and dreaming about the most wildest and crazy and impossible things. And that energy really struck with me because that was the energy that I was searching for.

And so I decided to stay and not go back. But at that point, I just, I'd had a Taurus Visa when I first came out. And so I had to figure out a way to, obviously I couldn't work here. And hackathons were, a very effective way to continue to legally be here, but like still win prize money to sur to survive essentially.

And, these hackathons were like two day events, for, to, to up to $10,000 in prize money. So you could win a weekend and live a coup, like at least like a month or two on one hackathon winning essentially. And so that was the first, snapshot into some of the Silicon Valley stuff.

Todd Jackson: All. So tell me about some of those hackathons. What, where were they, what were the rules? What were you building?

Kesava Kirupa Dinakaran: Yep. Yeah. Most of these hackathons, me and my co-founder, my sort of the co-founder started a company, the company with, we'd initially picked very strategically the ones that we wanted to go to. There were multiple of these hack multiple types of these hackathons, right? They're all the way from Europe, like sort of university hackathons to, to these large corporate hackathons.

And we focused on our kind of end goal was to survive, right? Here in the us. And so it was like, let's just go to the hackathons that has the most price, money and the ones that had the most price, money war, these sort of corporate hackathons. These were hackathons organized by companies like Twitter and Twilio and, shell, and they all had their sort of own versions of a hackathon that they ran one year that, you know, they tried to promote and run around a specific theme.

And so we focused very specifically on these type of corporate hackathons when we're building products, that were very relevant to the companies that ended up organizing

Todd Jackson: And if you were relying on Hackathon prize money to support yourself, you probably got pretty good at winning these hackathons or you were able to do it reliably somehow. How did you do that?

Kesava Kirupa Dinakaran: Yeah, I think we basically won almost every hackathon that, we did. So the only one we actually did not win was like, TechCrunch. And the, I feel like the reason why we didn't win TechCrunch was because all the rules that applied to these corporate hackathons did not apply to TechCrunch. Cuz in TechCrunch, they didn't care about some of these other strategies we used in some of these corporate hackathons where we built products for the companies themselves.

But in TechCrunch thousands of people participating on building the best product for that weekend.

Todd Jackson: But it sounds like you had a formula for that, for these corporate hackathons.

Kesava Kirupa Dinakaran: Yeah. What's really interesting is there's almost like an analogy that I can, you know, drive between how we ran in these hackathons and how we won them to, how we built the first, how we built at Lumina for the first year or two years. And, the thing about these hackathons, they are generally.

Advertised as this is an excellent place to learn and you should just come build whatever you like. But corporations who are that size aren't just doing hackathons for the sake of charity. And what was really interesting is, what we discovered was as we started to talk to some of these like hackathon organizers, there were two reasons why they were organizing the hackathon.

It was like one was either they wanted to recruit you into their companies. Or two is they'd want you to test, something that they'd launched recently or, an API that they'd put out or some version of that. And so what we do is just before the hackathon, the day of the hackathon, let's say the hackathon started on a Saturday morning, we'd call up the organizers on Friday afternoon, and Sweet Dock, our way to figuring out, why they were organizing the hackathon.

It was fairly easy to understand if, like they were organizing it for the sake of recruiting or for the, for us to test, their APIs. And so then when the or actual hackathon started, in the first three hours we'd ideate and try to think of something that was very specifically for that goal, whether if it was recruiting related, then we'd basically study all of their, engineering job descriptions, all the different types of, the stack that they were using and what they were looking for.

Or if it was something related to the API or some, something they've launched, then we'd build a product around that, being the core, of what we were, trying to do for the weekend. And in the first three hours, once we did that, This was the key piece of the puzzle, which was, we'd go and pick this idea back to the organizer, or the organizers, right?

And we'd get their feedback and then we'd come back and we'd build a little and then go back to them. And we did this over and over again in that sort of 48 hour time period while everybody else was just coding away, right? And what ends up happening in most of these hackathons basically is these organizers who are just serving you food and just like hanging out there, end up being the judges of the hackathon.

So when you'd go and actually pitch, you would've built exactly what they wanted to see, and basically almost had a hundred percent hit rate. Which makes sense why it didn't work in TechCrunch. Cuz in TechCrunch the organizers aren't actually the judges and they don't really care, what it is that

Todd Jackson: That is brilliant. So you basically reverse engineered how to understand what the judges were looking for and then built that iteratively over a three day hackathon and then we're winning them fairly reliably. That's amazing. So then how did you then get from that to Lumina or, I think at the time you had initially called the product digital brain.

Did that come out of a hackathon or what was the original concept for the product?

Kesava Kirupa Dinakaran: The first initial version, started at, this hackathon organized by this large German public company called, optimal Systems. Maybe they had changed, they called it the Uvis Hackathon, which was this, specific, cloud API that they'd released.

And they had a bunch of different tools around, OCR and, some other, APIs related to some of the stuff that we're building on today. And we'd initially started to talk to the main organizer at this hackathon, and they were talking about their want and focus, to build much better customer experiences, not just for their users, but helping, their customers give it to their end users, right?

And so that was the first understanding, even remotely what this problem space of sort of customer service and customer experience was. And that was the hackathon where the initial version of back then called, digital Brain

Todd Jackson: after that first hackathon, what did the product look like? What did the first version look like?

Kesava Kirupa Dinakaran: Yeah. So fundamentally what we realized was that customer service teams, or customer service folks, Were the first ever interaction that an end user would have. once someone bought a product, right? Or even before buying a product. And they were the brand or the face of an organization.

But what was really interesting was, I reflected on my own experiences with sort of customer service, and me and my co-founder, we deflected on our own experiences with customer service. And what we discovered was that, in the end of the day, all we care about, was how quickly can we get an answer or get some.

Issue resolved. And so what ended up happening was when we dug deeper, we also lived in this hacker house and one of these companies that, had raised a massive growth round, grew from one support agent to sort of 50 support agents over two quarters. And when that sort of hackathon had just happened, and when this friend of ours had built this company that, had to basically 50 x their headcount, we were like, okay, there's something, there's some weird like correlation between the linear scaling of teams to growth and that didn't feel

and so when we went and spoke to this founder, he was like, Hey, you should just come, sit in our support org and see what's going on. And so when we went and just sat in this, company's support org, what we discovered was that. Support agents were, they had four monitors. It looked like they were traders, like quantitative traders or something.

And they were jumping between these different systems to one, gather information, but two, perform the actions associated with these tickets that were coming in. And what was interesting was on, 20% of, or 30% of tickets, they spent 80% of their time. And that 80% of their time was actually actions and workflows that they did basically the same way every single time.

And it was like six to eight workflows that were somewhat bespoke to each and every company. And it felt If we helped accelerate that or turbocharge that part, then one, we're impacting that end user, experience. But two, we're helping the agents on many different other levels, beyond just making them better at their own job, but, reducing them from burnout and making them much more, less prone to even like mistakes that they're doing, on a day-to-day basis.

Todd Jackson: And so I imagine though, you, there were so many hackathons that you participated in, and this digital brain was one idea from one hackathon. How did that, how did you know that was the idea that you wanted to build a company around? It sounds like you connected that with the customer service observation you were doing, or how did that become the idea for you?

Kesava Kirupa Dinakaran: it's a great question. So what ended up happening was, this was probably the first time where it started to feel like. What we were building, could actually apply in the real world. And what I mean by that is the organizer of the hackathon that we built the product for, came back to us after one week.

So they'd already given us the prize money. They said, congrats, you win this hackathon. And then one week later they'd come back and the organizer emailed me and was like, Hey, our sort of customer experience organization wants to talk to you. And I was like, this is odd. Maybe they're just doing it cuz they want to interview us for something or maybe it's just an extension of this hackathon.

This is new, we'll take a call. So we take this phone call and this org is Hey, we actually want to deploy this internally. Is there any way you could license this technology to us? And that was that moment, from between vague hearing of the hacker house friend who was like, oh my God, I hate my support org to building this for, optimal and then, for optimal systems and then to the company being like, Hey, we're actually interested in, in using this internally.

That thread is what sort of, put us on this like idea ma of okay, maybe there's something here and we should go in and dig deeper.

Todd Jackson: Wow. Okay. And so this was like end of 2019 kind of timeframe? Early 2020.

Kesava Kirupa Dinakaran: That's right. Yeah. It's like September, October, November 20th,

Todd Jackson: Okay. And so then what was the first thing you did getting started in 2020, in those first few months?

Kesava Kirupa Dinakaran: Yeah, the moment we heard that, we were like, okay, great. Let's just figure out what we need to actually do to, license this. And then it involved a small set of, logistical tasks, that as immigrants, we had a little more, things to do, on at least the, incorporation side.

Getting a bank account set up and figuring out what a contract looks like, and, making sure that we're not like, dropping the ball anywhere.

Todd Jackson: so you actually signed like a paying contract with them? They were. They were effectively your first customer.

Kesava Kirupa Dinakaran: That's right.

And that was the first, version where we started to itrate with them towards the first version of what, Lumina ended up looking

Todd Jackson: And then I believe that you applied to join Y Combinator in summer of 2020. So what led

Kesava Kirupa Dinakaran: That's right. Yeah, I think as sort of young founders with no Silicon Valley network, the things that, you know, initially, even brought us to startups or helped us understand what company building was, was why C'S posts and pgs, essays.

And it was a dream in many ways, to get the chance to participate. And so we'd applied and, we'd actually, applied a second time. So we'd applied when we were doing those hackathons. And we actually had just done the hackathon with, with optimal systems. But, when we'd done the, we'd applied again, with a much more crisp, clear, and one sort of customer who was willing to engage with us.

They they were willing to take that bet

Todd Jackson: So what was in the application? What were you, what was the thing you were pitching at that time? How were you describing it?

Kesava Kirupa Dinakaran: Yeah, we called it, superhuman for customer support, superhuman, which is still the email client I still use, first round company. We, we basically realized we were going into this age of, design first software. In many ways because like when we talk to sort of customer support agents, There were mostly people who are our age, meaning folks who are, under 30 in most cases, if not younger, and they were starting their career. But for people who grew up in the advent of Instagram and, and Facebook and tools that, were consumer like software. Customer service was the opposite of that. It was dominated by tools that were predominantly born much, much earlier than, where the support agents sort of demographics were.

And so we ended up kind of building the first version, which looked similar basically to how Superhuman was, but for the customer service team. So it was just a layer on top of, at that time, Zendesk, where it transformed the workspace, into something that was a lot more, quicker, much more usable and super fast and had a bunch of other features that, that at least made their, we thought made their job a lot easier.

Todd Jackson: Okay. And so during yc, you're iterating on this product, building this product, getting some very early customers. What were some of the things that you learned in YC that were most helpful to you?

Kesava Kirupa Dinakaran: it's really a cliche, but when people talk about, the only things that matter, actually talking to customers and building products, the amount of help that actually, or the amount of justice, that it does by hearing it every single day over and over again, it deeply implants, that philosophy.

I remember like even a 24 hour period or a 36 hour period where you went into just build mode. I started to feel the sense of, hey, Am I putting myself in the shoe of this end user who is actually, going to see and use, what it is that we're building for them?

And I am not that person. I am not that person who is going to use this product. So are you thinking of yourself as someone who's just graduated, college, taking on their first job and has no idea about, the company, they're just starting to work for, are you imagining yourself as that person while building this?

So it's like small little titbits like that sort of added up, into us, like being able to get that first, initial, prototype or v p out and that was something that I think was drilled in, a lot more deeply, by YC

Todd Jackson: Are there any specific things that you did or like tactics that you could share about how to put yourself in the shoes of the customer so deeply?

Kesava Kirupa Dinakaran: Yeah, I think a lot of this is going to come down to becoming friends with your users. And I think it's becoming a lot more common where. Ycs advice was always like, give your phone number, like right off the bat. If when you onboard someone or when you're even talking to them, because when they're thinking about something that's even remotely related to you, you wanna make the friction, between them and you as small as possible.

And so in our case, it was like, how do we, how do we get them, to feel like we were their peer and that if we were sitting right next to them, they'd talk to us the same exact way, compared to if we got on a Zoom call, or whatever. And so that was the first start of just almost understanding them as a whole human being.

Like why did they pick the job? What was their sort of motivation? What are their kind of like long-term aspirations for what they wanna do? And in a lot of cases, It might really surprise you. A lot of these folks, like not everybody is like looking for Hey, I'm, I wanna, I want to become the CEO of this company.

I'm starting to work out as a support agent. Like a lot of them, wanted to just be a yoga teacher and support was a way to, live life while they pursue other passions. And so it's it's almost knowing where their intrinsic motivations are to help eventually, design and build what we ended up building for

Todd Jackson: so how many were you, were they like texting you and calling you when you gave 'em your phone number? And how many folks were you working

Kesava Kirupa Dinakaran: wasn't as often. it wasn't as often as I would've liked, I think. But at least I think we at least got one or two interactions per week from the sort of first four to five customers that we'd initially signed. when we were doing

Todd Jackson: Okay, so the first version was this superhuman for customer support. What was the reaction to that product when you put it in customer's hands.

Kesava Kirupa Dinakaran: the easiest features were just things like keyboard shortcuts and getting as much data in about the end customer they were talking to right in front of them. And giving them a very easy and accessible kind of interface to interact with that felt a lot more natural than an old school Zendesk interface or a ticketing system.

And so when we put that in front of them, I think in a lot of cases we saw in incredible sort of delight or want to use it, right? But that was at least our understanding of when we put it in front of them.

when we saw their faces light up it made us feel like, oh my God, like this is it. That was the first reactions that made us

Todd Jackson: And what was the thing that made their faces light up? That it was just so much faster, easier, better designed? What was the thing that really was the aha.

Kesava Kirupa Dinakaran: so this is what led us to do this, like zoom in, pivot. Maybe I'm like jumping the gun here, but basically when we gave the product their, eyes lit up and all of these things happened, but it wasn't until I remember this very specific user we were working with this company that was doing ride sharing fora sort of bike and scooter ride sharing company that was local based in LA and one of the sort of support managers.

I remember her very specifically, looking at one thing that was part of the product that made her go oh my God take my money. And it was specifically this aspect around automating away some of their repetitive workflows. And in this case it was a very simple workflow that we'd integrated where they could click refund on a subscription that someone you know had if someone requested a refund on a subscription, then you could do that refund through back then Digital Brain in, in just one click.

And when I heard that reaction from this one customer, we recorded all of our calls until that point. We ended up going back to actually every single call and notice when their, when they had that moment of aha. And what was interesting was they weren't impressed by the keyboard shortcuts.

They weren't impressed by the sort of how fast the interface was. They weren't impressed by, how pretty the product looked. What they were actually impressed by was the things that made them feel incredibly tired and bored and very manual and very cognitively heavy when we shored one use case of that being taken away from their day-to-day, that's when their eyes, would light up and you'd see their eyes become bigger and you'd hear their like, voice become different.

And that's when it started to feel like, okay, like we've seen this now with six or seven customers. What if we like just stripped everything else out and just focused on this like one specific use case. And and do real research to figure out if this is

Todd Jackson: And just to be clear, it's because the act of issuing a refund prior to digital brain involved go, I assume going to different systems and clicking different buttons and different applications and wherever the orders are, wherever the payments happen. Is that why it took so, it was such a better experience.

Kesava Kirupa Dinakaran: Yeah, so here's just an example. So we work with a customer. We work with a customer called Aura Ring. It's like a sleep ring company. They have hundreds of sort of support folks and, to process a refund, traditionally. And this is not just for ordering. This is actually a majority of retail customers, if you look at them, they, what they're doing basically is, once a customer writes in, they're copying their email, they're going to an order management system that's homegrown.

Generally, homegrown admin systems are like super slow to load and get started. They're going in, and they're searching for this user. They're finding that specific order. They're clicking cancel on that. Then they're figuring out how much to refund or they're figuring out the amount that needs to be refunded because they're they can't give refunds on shipping and they can't they have to figure out what the sales tax was based on Which specific state this person was from, or which country they're from.

So doing, they're doing all the math and then going to a payment processor and then if it's like a much more clunky payment processor, then they're like navigating that own system and then doing the same set of actions basically to do the refund. Then they're going to a shipping provider if you go have to work with, Canada Mail or u p s or something, to even navigate that interface is a job of its own.

And then you're creating this shipping label. You're downloading the shipping label, you're going back to the end user on Zendesk and then attaching it and saying, Hey, your refund has been processed. Can you make sure to attach the shipping label and Send the product back to us?

So when you're dealing with these like five different systems and like 40, 50 different clicks to process one refund. That's incredibly tiring and a huge weight on the sort of support agent where they've signed up to talk to customers, but 50 or 60% of their time is spent on doing things like that are like this

Todd Jackson: So digital brain was able to get that all down to one click. How did that work?

Kesava Kirupa Dinakaran: Yeah. So this is the magic of what we offer, even today. So even about two and a half, three years in this is what our focus area is. And. We were figuring out like, what are the ways we can solve this problem of unifying these multitude of systems.

So we discovered, many different approaches to these problems. And the one that was the most exciting, or the one that, blew my mind is this whole world called robotic process automation and rpa. That's right. And RPA has been around for a long time UiPath and automation area.

These are all like public companies valued in the, billions of dollars in some cases, tens of billions of dollars very large businesses. But they've not necessarily doubled down or focused on sort of customer service or contact center. And the concept of sort of RPA is you're able to record what it is that you do and.

the software is able to keep track of sort of the clicks and keystrokes and then generate a front end JavaScript automation of you of the software doing the exact same things that that you do. And so when we discovered that, I was like, oh my God, this is so crazy.

It's been around for so long, but like it's it manifests its way in sort of automation and like testing, and like software testing. And it's been around for some of these old school enterprises, but this could be a very clever way to solve this problem because it's the same exact type

Todd Jackson: Nobody had

Kesava Kirupa Dinakaran: a little bit of decision trees.

Todd Jackson: That was the insight.

Kesava Kirupa Dinakaran: That's right. Yeah. That was really, it was there was back office, there was claims processing and insurance and all these things that they'd applied it to. But not necessarily to a new age kind of customer service software. And so that's when we said, okay, let's just try to build this into the first version of Digital Brain.

And that was the a stop gap way to get things started.

Todd Jackson: So you had labeled this as a zoom in pivot, where you said, okay, this is the most interesting part of the product. Let's strip everything else away and focus on this. W what did that actually mean? Did you end up like fully rewriting the UI and did you add a bunch of functionality around the RPA.

Kesava Kirupa Dinakaran: Yeah. So we basically, almost essentially removed almost maybe the, even the way to put it is we went from zero to one, in the sense of we stripped everything out and there was nothing, we'd not used any prior cord. We'd rewritten the whole

Todd Jackson: Oh wow. From scratch.

Kesava Kirupa Dinakaran: And Yeah, from scratch basically. Because it was easier to do that than try to play with what we'd already did. Cause it was all like junky, very easy MVP code, right? And so we ended up building this sort of Chrome extension that layered on top of your existing systems.

So now we didn't have any problem of we had to integrate into Zendesk or Salesforce or Intercom, or we didn't have to think about what system they were on. Right now it's just a layer on top of their existing system. So it opened up the market a lot more, right? And now all they had to do was install this piece of software and a bunch of their automations, which just pop up and now they click the button and it would open up this headless browser and like essentially run those same exact workflows while they continue to do their job.

Todd Jackson: So I'm trying to figure out what is the advice to other founders here? Like how do you make the decision to say, we think there's something really here. We're gonna throw away all the code that we've written, we're gonna rewrite it based on a new idea. What are the signals that, like where you knew that was the right thing to do?

Kesava Kirupa Dinakaran: So I haven't actually gotten into some of this. What I feel like in B2B software,it's like probably one of the most important things to do early on is actually sell before you write code. when we initially sold the first version of Digital Brain, we sold it just as a superhuman type, competitor.

And so we priced it at we we just were like, okay what's a good price point? Let's like try $30 a seat and sell it, right? And what was really interesting is what we said was, okay, let's like strip everything else. Let's just throw this little, automation pallet in front of these same exact customers and see their willingness to pay.

And it's not We'd ask them tell us how much you'd pay. We'd go in fully prepped, like we were a big business and have this whole pricing deck and whole pricing proposal. And we'd started the, at that point, at 1 39 a seat per agent. For a layer that was on top of something they were paying the same amount for.

That was a system of record. And what was mind blowing or what was the point where it felt like, oh my God, this is, it was actually when four to five customers said yes to that size of contract, where each were willing to pay a hundred and thirty nine, a hundred forty $9 per seat for a layer on top of Zendesk.

That was just an automation pallet. And at that point one made us realize, okay, like people have a lot more budget than we thought, but two it made us realize, okay, like this, Willingness to pay at certain price points where the math works for us, but also the need is clear because they're willing to invest so much is a sign that we should go out and build this versus let's just talk to users

Todd Jackson: Oh, okay, so you actually went and sold,

Kesava Kirupa Dinakaran: a little bit of

Todd Jackson: you sold these five contracts at $139 a month per seat, per month. And then that's what gave you the conviction to go and rewrite the whole thing from scratch.

Kesava Kirupa Dinakaran: That's right. So we knew that the first version of this we could probably whip together in four to six weeks. And so we were confident in being able to at least get some version of a very, there's something they can use basically at that point. And so what we decided to do was say, okay, if we're able to do that, When we're working with these customers who are willing to pay this much, they'd be more than happy to wait when we put down a proper implementation and customer success cycle that involved that type of, timeline.

And so that was the point at which we said, okay, let's get a few of these up and running and if they sign, then let's go out and rewrite this whole thing. And we did it the second time around. It was a much, much more effective one cell, but two product we ended up building.

Cause we knew exactly what we wanted to

Todd Jackson: Wow. And how did you pick the 1 39 number by the way? That's five times more expensive than how you were originally trying to price it. How did you just come outta thin

Kesava Kirupa Dinakaran: it was very similar to what they were paying for Zendesk or Salesforce. If you look at Salesforce pricing, it's between 99 and 180 9. And if you just wanted the ticketing system, it was like 1 39. And so we said if they're willing to pay the exact same amount as their system of record, then we have something there.

Todd Jackson: So who were your first customers? Did you start right off the bat with Aura Ring and whatnot, or was there a sort of a smaller customer that you were going after? Initially, your icp.

Kesava Kirupa Dinakaran: I think the first set of customers actually who we rated with we learned that the larger the sort of support org, the more ROI they'd see, if we, increase the efficiency of an agent by 5%, It is hyper valuable if you have a five, 500 person support team versus a five person support team.

And so we had to step a little bit a little bit back out of Silicon Valley in some sense, meaning I think what we grew up in this world of, PLG and Figma and Stripe stripes of the world. And we had to step back a little bit and say, okay, where are these incredibly large organizations that have customer service?

So yes, we talked about, ordering and Strava and whatnot and some of these customers, but these are the reasons we're mentioning these customers or these are customers that people who listen to something like in depth or some of these people like actually know. But a majority of the customers we're selling to today are customers you've probably never heard of or never actually interacted with, but they're like, accounting, small accounting firms in Arkansas or something.

But they have like, Hundred and 50, 300 people in the back office doing these types of work over and over again. And there are very little resources and engineering to be able to like get access to something like this. And the first set of customers we went after, keeping that in mind, we were only getting going after customers that actually had a sizable support team.

When we started to start working with whatnot, we said, okay, let's like at least aim for sort of 25 folks on a team because if we increase their efficiency by 10% or something like that would be a sizable amount of money we're saving for them in, in, in relation to the amount they're paying per seat per agent.

Whatnot grew very quickly. It went from 25 agents to over 200 in, in nine months. And so that was a very different kind of story. But I think in majority of customers we focused on, we tried to havea fairly large sort of customer service organization.

Todd Jackson: It's interesting cuz I think it in some ways is a lot harder. I think founders would tell you, oh, you're a B2B startup coming out of yc, sell to other YC companies or sell to series A startups or Series B stars. You were aiming bigger than that because the product was meant to be used in bigger organizations than that.

But did that make it substantially harder in those early days?

Kesava Kirupa Dinakaran: So I will tell you like, it's not like we didn't try the sell devices, startups, or, sell to young companies. And. When we started to sell is when we actually got that feedback that, okay, like we're not actually seeing the ROI that adds up here. And it became a lot more intuitive cuz we were thinking, okay, if someone sold us customer service software, would we like be willing to pay this much?

And think about it And it didn't add up cuz we were trying to sell to people like us. And it it at least initially during YC or just after yc, that was the case. But then there was this 12 month period of like just navigation of trying to find out who actually is this type of end user.

And that's when I went into this like whole rabbit hole of let's look at the most successful like enterprise businesses ever built. And if we look at all these old school enterprise businesses, these are Very tops down, very large, but very clear in terms of when they have the need, the willingness to pay is just super, super straightforward.

What does that in relation to the kinds of customers working with today or the people who face the problems that we're solving for today. And so that's what eventually led us to think a little bit like the ServiceNow of the world, the workdays of the world where we're selling to some of these like much more enterprise, larger sort of businesses.

And today, we have an SMB or mid-market business, but we really double down and focus actually mostly on the old school enterprise side of customers.

Todd Jackson: And so walk us through how you sell to that type of customer. Who do you target? What is the message do you think about the buyer or decision maker of the sale being different than the end user? I assume you do. And so walk us through how you sell Illumina.

Kesava Kirupa Dinakaran: Yeah, so the biggest difference actually is everything that I think I learned initially through, traditional sort of Silicon Valley successful startups does not necessarily apply in this type of selling. You have to, in, in maybe have to, is a strong word, but in most cases it is very effective if we're able to figure out who are friends of the ceo.

And what I mean by that is figure out, how can I get a warm introduction to this specific customer, right? And it's not Let me figure out who's the exact end decision maker and find an intro to that. It is literally let's figure out who has the most power within this organization.

And let's figure out who they talk to and let's become friends with that person so they can, they're willing to just put in a good word or make that introduction to that person who can then forward

Todd Jackson: So you usually go a level or two higher in the org chart than who the actual decision maker is. It sounds

Kesava Kirupa Dinakaran: in, in, in most enterprise cases we start actually with the ceo. We get, we try to get in front of the ceo. We don't try to get a phone call with them, but we try to figure out who is it that they actually respect. So it's not a question of, do you know this person? It's actually a question of how do you know this person?

If we're talking to some of our investors and they're like, oh, I know the ceo. It's not just great. I'll send you a blurb. It's actually like, how do you know this person? And then once we get that, the, then they forward this blurb with a little, recommendation almost to be like, Hey, you should take this seriously.

And then and then the CEO generally forwards that, in our case to the VP of customer service, to the VP of operations. Who then, when they hear from the ceo, they're like, okay, I don't even know if this is useful for me, but I will still take the call because it's coming from tops down.

And then it becomes a game of, okay, like, how do we orchestrate the right strings to make this

Todd Jackson: That makes sense. So then you get your first call, your first meeting with the VP of Ops or VP of Customer success. How are you pitching the product?

Kesava Kirupa Dinakaran: Yeah. And so the first call itself is it's like basically getting them to a point where they're screaming about the problem that they care about the most. And so we try to actually. This is, again, maybe counterintuitive to what a lot of people are generally used to where we try to actually do 45 minutes of discovery.

So first 30 to 40 minutes we actually just spend, like trying to understand who they are as people, what is it that they care about, what is on their roadmap, what are the current projects they're working on? What is their biggest sort of way in which they get eventually promoted or what is their sort of aspirations within the company.

And once we understand that then we're going into, okay, how does what Lumina solve for today actually integrate into their long-term plans at the company? And so in today's world, it's probably something like, especially the customers we're working with, how am I going to be the person who's bringing this NextGen AI technology into your org?

If I bring this, will I will I be the person who brought AI into this like old school org? Amazing. Great. If that's the pitch, then we know how to sell into that type of person maybe six months ago it was like, margins are all what matters in our business because we are trying to become profitable.

We're trying to become a business that, long term is running extremely lean and super efficient. And at that point we're talking about, efficiency and we're talking about this is the person who is helping set the standard for running a lean org or for running a very efficient business.

And Lumina is that first step for them to get there. So it's basically taking what you're building and fitting it into their narrative of the story. Even if the product doesn't change in any form, there's three or four different types of ways in which you can sell that story.

It's basically learning what that problem for them is, and then, putting them into

Todd Jackson: So you, it sounds like you spend the first half at least of these conversations just really learning about the customer themselves and what their personal goals are and what they want to get done at the company. And then based on what you hear, you've got three or four different ways of positioning Lumina to be the answer to their questions. Do you ever get a customer who's just in the first 30 minutes, like, why are you asking me all these questions? I just, I thought you were trying to sell me something.

Kesava Kirupa Dinakaran: Yeah, I think it is probably the most uncomfortable part about our sales process. And for new sales hires, for example, to be okay with that because I was just on a sales call before this and literally like minute 30, we haven't told them what we do, right? And and you can almost see their faces go what am I doing here?

Like, why am I on this phone call? But what's really interesting is at minute 30 when you then switch into pitch mode, Everything that they said, ize the answer to that problem. And when you put that, the effect of the product and we don't always do demos on first calls, but in this case we did.

But like, the effect of that demo in this call that we just had is just a hundred times versus if you just be like, Hey, we help automate your repetitive workflows, here's a cool demo. They're like, great, sounds good. Like maybe this is a fit, maybe this is not. Versus you make the answer to all of their problems like your product at that point.

it doesn't always work but when it does, it accelerates the sales cycle, especially in some of these old school enterprise orders. Like so much so much faster than if you just went to a traditional

Todd Jackson: So when does it not work, and is this something that you think a lot of B2B founders could be doing more of? Like when is this tactic very successful versus when does it not work?

Kesava Kirupa Dinakaran: It doesn't work when the ICP or the pitcher making is with the customer that actually doesn't need your product. there was a phase where we expected certain companies to actually be perfect fits for the product, when in reality they were not. We just assumed oh, if you have a very large end user base, then you need Lumina because you'll probably have a lot of queries. That's probably not the case in a lot of these cases. And that this might be immaturity in our part when we started. But a, a big part of the first like 20 to 30 minutes is basically discovering actually whether they fit into this problem and doing the pre-work ahead of time through various other sources. Whether this is actually the right fit when you reach out to a company. For example, like simple things like, job boards reveal a lot of, like whether this is a company that is like looking

Todd Jackson: I see.

Kesava Kirupa Dinakaran: meaningif they're hiring eight support managers,

Clearly they're scaling headcount. If they're trying to scale headcount. Not everybody wants to just keep hiring for the sake of hiring maybe in 2021. But, people are not hiring for the sake of hiring. Like at this point they're hiring cuz there's a clear need to manage a lot of these people or just get more and more bodies on the problem.

What if we just become a part of that solution? So doing a lot of that pre-work ahead of time. The job board is one example. There's various types of these sources for every company that you, depending on the company. But those are just some of the

Todd Jackson: Yeah, but it sounds like it's because you figured out early on, Lumina is perfect for people that are growing their customers, their customer support orgs, where it's like they're growing it so fast, stuff is breaking. Lumina is the answer to that. And then you're like reverse engineering, or what are the signals that we could look for externally where we know that they're in that situation?

Kesava Kirupa Dinakaran: So that's one use. Or the other side is the org's already like very bloated or super big, right? And that's uh, an easy way to discover, okay, like they're all trying to cut costs and become more efficient while not necessarily linearly growing, right?

And so that's Lumina's almost Hey, we'll be like 20% of your workforce. And you should buy Lumina

Todd Jackson: Cool. I love talking about the sales stuff. Cause I think, especially in the early days, founder led sales are so intertwined with finding product market fit that it's really interesting to hear how you think about these things. what are the moments in time when a founder really realizes they're getting product market fit feedback or like something is working right?

one of the very early moments for you was, We can sell five customers at $139 per seat per month. That was a validation moment for product market fit. What are some of the others that kind of came after that really stand out in your mind as validation moments?

Kesava Kirupa Dinakaran: may, maybe this won't sound super nice coming out, butbasically can you get some random person on the street? Give them your pitch and can they close a deal? It's it's like it's repeatability at least in our world, it is repeatability of what it is that you are building.

Attacking a very specific type of problem with not a hyper complex, but fairly straightforward way to go through a sales cycle without having any sort of involvement. And I also won't say that, we're 100% there, right? We're tracking towards that. And I am very closely monitoring what repeatability means for Illumina's go-to-market org, right?

But that's one of the most important things for us to get to a point where I feel like we have a hundred percent product market fit. And what I mean by that is literally Can can we say, here are the like five things you have to sell a customer on and will they sign right?

And are they all going through the same set of steps sa using the same types of scripts? And are they predictably closing within a window that's plus or minus two weeks, right? If we're able to do that, then, we found a very clear audience and a very clear sort of point at which, you know we could hire a bunch of people and it would just

Grow in terms of our revenue. And I think that, Has more recently happened in some of our like specific segments that we're selling into. retail, for example, is one of those segments that we've found very clear, easy use cases, clear, repeatable, sets of problems. Healthcare is another one where we sell into all of these like digital health clinics.

We sell into some of these like insurance claims processing stuff that all still falls under customer service. And so those are some examples of where like we fall, we found like just some of this repeatability happen. And I would say that's at least what I've noticed across like a lot of founders I spend time with something that's not like intuitive when

Todd Jackson: Do you have any lessons there about going after so many verticals at once, healthcare, e-commerce? Is that a good thing to do or a challenging thing to do?

Kesava Kirupa Dinakaran: I think it's not the most, most straightforward to be very honest. It's actually something that, what you're chasing after is basically quality of revenue. Right? by quality of revenue, what I mean is the sort of relatively in our case, cost of doing business,

for us, for this contract to have. Let's say we take one customer and they're having X amount of roi. Are they willing to pay a significant portion of that ROI back to Lumina? Along with engagement of the product. So it's not they pay us hundreds of thousands of dollars and then they don't use it.

It's are they paying hundreds of thousands of dollars and then still constantly using it, still engaging with us, giving us feedback, asking for things, right? That sort of cycle basically is what in the end of the day I would think of as quality of re like high quality revenue

And if we're able to think about that from day one and build that into even the culture of the company that is one of the things that, we're hyper focused on, at least on that

Todd Jackson: It's interesting to hear you label it as quality of revenue. And so what you mean by that is, number one, the customer is willing to pay a large percentage of their margin to you. And number two, they're engaging with you very deeply. What does that end up yielding like? Why is that high quality revenue so much better than any revenue?

Kesava Kirupa Dinakaran: So the thing that, at least in SaaS businesses, there's so much predictability. Once you've layered this in, because if you have high quality of revenue, which is you have a strong foundational base that's somewhat positive in terms of, how much they're willing to pay, plus they're engaging with you, the likelihood of you having like, Uh, good net dollar retention long term is probably very high, right?

When they're engaging with you, you have more and more opportunities to show how much Lumina can do for them beyond just what they're using you for today, right? So you become almost this like little thought partner, right? So when we spend time with our customer success folks, they're not just being like handholding, like making them happy in the context of day-to-day use.

Todd Jackson: They're the slowest salespeople, meaning every conversation they're having is actually a sales conversation, right? for them to expand, for them to grow, for them to, continue to think about sort of, uh, NDR with us, right? We've talked a lot about how you grew, customers sold to them, grew revenue. wanted to ask about the team side of that the folks that work at Lumina and the fundraising side of that. So how did you grow your team and think about fundraising as the product was growing?

Kesava Kirupa Dinakaran: Yeah. On the team side, We've kept it very small intentionally. And I think this is a lot of companies especially today and we've kept it small in the context of revenue range or scale of business.

We want to always think about is the person who is at Lumina the most healthily stretched as possible? And what I mean by that is it's not just for us, conserving capital or it's not just for us like being efficient. It's because employees and folks who work at a company will say only if they feel incredibly challenged and excited about the things that they're doing on a day-to-day basis.

This. And so for us that, we, we just actually hired our first ever marketer, right? Probably later than the average company. when we hired her, right? What's interesting about at least in her case we said, let's just you do the zero to one fully, right?

Yes. You have the resources to go out and find other folks to help you wherever you need. But do you feel constantly challenged and do you feel like you're healthily stretched on a daily basis that you're not leading to burnout? But you are pushing to the maximum extent. And for that reason, we've kept the team quite small.

I might get these specific numbers wrong, but I think we have just around, 17 or 18 people. But we have seven YC founders. At Lumina. So YC are former YC founders at Lumina. So it's a very entrepreneurial

Todd Jackson: do that

Kesava Kirupa Dinakaran: I would like to say intentionally, but I think at least the first couple weren't as intentional.

The next few were because like we started to realize the impact you have as someone who has run a company previously. And by the way it's six or seven YC founders and then three or four people who've raised at least three or 4 million. So more than half the team today is like some form of founder in the past.

And they all run their own sort of, functional units within the company. This is what we call the first team or whatever which is coming

Todd Jackson: I don't think I've heard of a company like this before where you have it sounds like more than half the company's previous founders. I mean, are you ever like, we have, there's too many founders in the kitchen right now.

Kesava Kirupa Dinakaran: I think what's interesting is most of the people who joined Lumina, yes, there are some of them who want to still go back and start another company much later, maybe post Lumina life, but most of them, have that deep entrepreneurial understanding. I'm hoping alumni, is a rocket ship, but want to join a rocket ship to So experience that sort of, massive upswing.

And so in a lot of cases, traditionally we would call them unqualified or something. You'd be like, oh, on paper like. They're probably many candidates who might look a lot better, right?

But when you actually spend time with some of these folks you realize that hunger and that want to grow and that, that want to excel within whatever they're pursuing within Lumina is maybe a 10 x If someone, if we just hired someone who, fit the bill. we could have hired some VP of sales who, sold UiPath.

Or some maybe, we'll, maybe we will long term, right? But today, we have a former YC founder who did YC back in 14 who was running the entire sales org and, and it, we're still like pushing ahead, but right now I would say it's doing incredibly well. But I think it's a lot harder to do that when your incentives are maybe different.

Todd Jackson: How about fundraising? So how have you approached fundraising, Over the years and the milestones that you needed to reach to raise each round.

Kesava Kirupa Dinakaran: Yeah, so I, I think, the one unconventional piece of advice that I, oh, not advice, but what unconventional bet we made on our fundraising journey and maybe it will not work at the series B or series C stage is actually a focus on just the depth of personal story and on the focus on the first 20 years of my life compared to the the actual sort of what have we done in the last whatever the prior six months or three months, because I, in my view, what I felt like when I started to spend a lot of time with early stage investors, at least the ones I wanted to work with.

What was interesting was the ones I wanted to work with they mostly wanted to bet on people, right? And so in my head, it didn't make sense for me to just start off being like, Hey, Illumini helps do customer service agent automation. Here are our customers, here's our revenue, here's our ndr.

I think you should invest. It was more here's the first 20 years of my life. Here are all the points that I think are inflection points. Here are all the different parts that led to these inflection points. And here's why I think this starting of this company is another inflection point and why I think I will become world class at this I think has always been my mentality towards like fundraising.

And that's helped raise the, all this money so far at

Todd Jackson: So when you connect the dots on that KE app, are there things where you think back to, oh, this is, the way I approach running the business now is heavily informed by the way that I grew up, or things that I learned in those first 20 years. I.

Kesava Kirupa Dinakaran: Yeah, I think we're all, I think the company's always a reflection most mostly a reflection of some of that early cultural elements that you set as founders and. A lot of those early cultural elements, I think come from your upbringing. And for me, it was an upbringing of of of grit, right?

Of perseverance. It was always a it was always a sense of you can push through any pain, you can push through, basically any wall and, find your way to whatever you thought was at that point success. And so a lot of when we started was just like, let's just think about what is it that we want to, what is it that we want to do, increase in the next six months or 12 months, and what is the shortest way to get there, but do it in a very sort of calculated way, but without missing on, the sort of need for hunger and want.

And and I think that's how we've hired also for every single person. And maybe that's the reflection of all these founders we've hired so far too.

Todd Jackson: Okay. So sitting here now in 2023 what is exciting to you at Lumina now? What are some of the things that you're focused on now and some of the things that you're looking forward to?

Kesava Kirupa Dinakaran: Yeah, I think maybe, what's really interesting or very exciting about some of this, like AI wave and all of these things that's happening is actually, like I I'm like very convinced that for you to win in sort of B2B software or for you to win in the world, we're in, at least today, you have to be insanely commercial.

And what I mean by being insanely commercial is Everything needs to still go back to the f the foundations of a business, which is, are you making money? And is revenue quality revenue coming in? And this is why, I constantly reference, ServiceNow, Workday and Snowflake and some of these old much, maybe what Silicon Valley doesn't, Snowflake's obviously Alert, taught about, talked about a lot, but Workday or some of these older school businesses, Adobe, it's really interesting cuz I don't know anyone who uses Adobe, but like why is it a 200 billion company?

It's it's really fascinating. But I think that's what I'm excited about is being on that path basically in, in becoming a deep sort of enterprise org, right? Where we're helping the transformation of some of these like much more older school businesses to think like Silicon Valley.

But also at the same time willing to work with younger, earlier stage companies like ours. It's like the time at which they're willing to take that bet because of all of this change that's happening so quickly. But at the same time, I think the ones that end up who, who will end up winning are actually not the ones who end up selling to Figma and Stripe are the ones who actually end up selling to by selling, I mean like the product selling to, the service nows of the world and the old school insurance mutual benefits company of or mutual insurance company of Massachusetts or something.

I think those are the companies that will end up becoming a lot larger than than your day-to-day tools that you see.

Todd Jackson: So getting to the end here, Kesha, I want to ask you a couple questions that are more around personal advice. What are some of the most common mistakes other founders make when they are first starting out?

Kesava Kirupa Dinakaran: generally everyone's running towards some sort of milestone as quickly as possible. But if I reflect back on if there was something I would do differently is I would actually spend a lot more time with some of those early customers and thinking a lot more about who those first five to 10 design partners or five to 10 customers were, and the reason I say that is because I feel like we could have still landed on the same type of ICP that we're selling to today, but we could have probably saved like six to 12 months of our journey if we spent some of their time upfront.

And I think it's coming from a lot of common wisdom around just like. Trying to get X percent growth over, over a period to, to fundraise to get a seed round done. But I think what we, at least my perspective on at least incredible investors is actually, if you have a true depth of, like the understanding of the customer you're selling and being incredibly opinionated about why you're selling to them and why they will lead you to a hundred million dollar or a billion dollar revenue business I think is probably one of the most important things that I feel like I did the mistake of, and I feel like a lot of founders, especially young founders end up doing without thinking

Todd Jackson: Love that advice and agree and love it when founders can articulate, so deeply the, in the voice of the customer. Okay. Last one. Who are the most memorable people or mentors that you've had in your career, and what did they teach you?

Kesava Kirupa Dinakaran: One investor I work with who led Lumina seed round is this woman named Katie Stanton. She runs a fund called Moxie Ventures, along with Alex Ard, who's her co-founder.

And what's incredible about, having, working with someone like Katie is when she first took the Becca on Lumina, Lumina was the first ever round she'd ever led from her, from our fund one. And what was really interesting was, the context in which, she decided to make the investment.

It was in a very short timeframe cuz we met very late in the process. But also once she made the sort of commitment she almost. Became a part of my life, not just in the context of let's build Lumina together, but like, how do we Get Koff to become a world class ceo. And what I mean by that is not just Hey let's just find intros to every customer you can sell to.

Let me connect you to all the like, product people I know, et cetera, et cetera. It was things like, she offered to talk to my younger sister who was thinking about what she wanted to do in her life. And I was telling my sister about Katie and Katie was like, and Katie had no idea about this, but she was like, oh, tell me about your family and all these things.

And at this point she's met my whole family. She offered to pay for my sister's college tuition. It's like going above and beyond I think. What someone could do, she did. And it's been so special. For me in that way on the business front.

On the other side, there were these two people this person called Brett Chik and Amad Joseph. They're they when I first came to the US. I actually lived in. One of my, one of my roommates from U W C went to Stanford, and so I lived with him for the first four weeks and in one of these dorms at Stanford.

And when I first came out here, these two people, I'd met them through this program that first brought me here. I. When I was telling them, oh, like I'm trying to figure out like where I wanna live and all that, and they were like while you're trying to figure it out, you can just live with us.

And so I ended up staying with them, for the, for those sort of first those next six weeks. And ever since they've put in that, almost when I was going through even those times of, hackathon prize money and living almost like week to week in some ways I always was like, oh, I guess maybe this is the last week I'm here because next week I went, I might have to go back cuz I actually don't have any capital left and things like that.

And we're not even expressed anything remotely like that. The first thing they say is Keisha, what do you mean? You can live with us. Like we, we'll take care of you, we'll support you. And I think that's like those are things that are just like luck and the openness and willingness and generosity of.

Of of people here not just in the US but like in Silicon Valley and and they've played a key role in where I am today and I want to, and I'm sure they will play a much bigger role in, as my journey continues to pro progress.

Todd Jackson: that Kesha, you're surrounded by some really good people. I'm a big fan of Katie's as well, so I'm glad you mentioned that. And your story's incredible. So thank you so much for being here with us today and sharing it. We really appreciate it.

Kesava Kirupa Dinakaran: yeah. Thank you Todd. We appreciate it.

Todd Jackson: Today I'm joined by Kesha Krupa, Dina Koran, the co-founder and c e o of Lumina, a company that automates workflows by taking any multi click process and making it one click.

Lumina was founded in 2019 and is now a series a company that's raised over 20 million to date, backed by some big names like General Catalyst, Moxie Ventures, underscore VC, and Craft Ventures. Lumina's customer base includes many great companies like Strava, whatnot, and Aura Ring, and Kesha is a remarkable founder, a Teal fellow and Forbes 30 under 30 recipient who broke the Guinness Book of World Records for number of Rubik's cubes solved in one hour with 290, which was 80 more than the previous record.

I'm really excited to dig into his background and Illumina's founding story. Kesha, welcome to the show.

Kesava Kirupa Dinakaran: Thank you for having me.