Triangle Tweener Talks

00:00:04 - Announcer
Welcome to Tweener Madness, the high stakes startup showdown where eight promising companies go head to head for a $25,000 investment prize from the Triangle Tweener Fund. But before the competition kicks off, let's meet the people making the tough calls. The judges. In this special Meet the Judges episode, we're sitting down with the investors and industry leaders who will be asking the hard hitting questions, evaluating the startups and ultimately deciding who moves forward in this bracket sty competition. Each round, three judges will vote on which startups advance leading up to the finals in early April where one company will take home the top prize from the judges. You'll hear about their backgrounds, what they look for in a winning startup, and maybe even get a little inside scoop on their decision making process. So if you're a founder looking for investment, an entrepreneur curious about what investors really want, or just someone who loves a good business battle, you are in the right place. Let's meet the judges. Here's your host, Scott Wingo.

00:01:06 - Scot Wingo
Today we're excited to have Mahathi Sridhar here. I'll let her explain who she works with, but she's been in the local community for a while, moved away for a little while, which was very sad, now has moved back which is very happy. So it's been a little bit of an emotional roller coaster with her here in the Triangle. We're excited to have you on our selection committee for Tweener Madness and what we're trying to do here is introduce folks to who you are in your firm and your venture experience. Thanks for joining us.

00:01:36 - Mahati Sridhar
Yeah, thanks for having me. Excited to be here and to be participating a little bit about me so I'm a partner at Revolutions Rise of the Rest. We're a seed fund based out of Washington D.C. we focus on companies that are proudly based in the rest of the country as our name alludes so companies headquartered outside of Boston, New York City and Silicon Valley. We typically are writing initial checks anywhere between 500k to a million dollars in round sizes anywhere between 2 to 5. And we're generalists so we do truly anything from consumer CPG all the way through defense tech, really tech heavy businesses. But our bread and butter, if you will, would be enterprise SaaS. And that's the largest wedge of the pie as you look at our existing investments. We're not lead investors so we don't set the terms or take the board seats but we typically do like to be that second or third largest check into year round and are really, really excited about entrepreneurs building businesses in sort of the phenomenon. Obvious place, if you will.

00:02:42 - Scot Wingo
Cool. And you just got moved to partner. So congratulations on the promotion there.

00:02:46 - Mahati Sridhar
That's exciting. I appreciate it.

00:02:47 - Scot Wingo
Yeah. And then let's go back in time though. So you're from the Triangle, right?

00:02:52 - Mahati Sridhar
I am from the Triangle, so I grew up in Raleigh and I'm a very proud Tar Heel. So I know you cheer for a different team, Scott, but that's all right. In the spirit of both of our.

00:03:02 - Scot Wingo
Basketball teams are not good this year, so we can commiserate right out, right?

00:03:05 - Mahati Sridhar
Oh, but yes, went to Chapel Hill. Started my career off in investment banking, which took me away from the Triangle for a bit. I spent some time in New York and in Atlanta with that, and then kind of fell headfirst into the world of venture capital through this program called Venture for America. RIP it doesn't exist anymore, but similar premise to Teach for America, where they place young professionals in secondary and tertiary markets across the country to really help jumpstart and work on those ecosystems, either working at a startup or with a startup adjacent player. And so with that experience, I found myself back in Charlotte and started to work alongside and help build a venture fund there that focused on early stage Fintech. From there, I jumped over to a local fund that I'm sure many folks are familiar with. Bull City Venture Partners. Hung out with Jason and David for a while before I went up to New York City, which is where I was for the last six years and for the last almost four, I've been with Rise of the Rest. So venture for me has been definitely the lion's share of where I've been spending my time. I love working with early stage founders that are building really awesome businesses.

00:04:14 - Scot Wingo
Very cool. And then I'm pretty familiar with the Rise of the Rest. But like, for folks that have never heard of that, give us give a quick kind of background of, you know, who is the person behind it and what's the inspiration for Rise of the Rest.

00:04:28 - Mahati Sridhar
Yeah, totally. So Rise of the Rest, we're a part of Revolution, which is a family of funds. All the funds were founded by Steve Case. He formerly founded AOL American Online. And for Steve, he, he very proudly built his business in McLean, Virginia, which is not Boston, New York City or San Francis. Go. And for him being able to build such an incredible business that really revolutionized the Internet, you know, 20 or so years ago, he wanted to be able to support other entrepreneurs that could do similar things and be sort of that tent pole company for their ecosystems. Because a rising tide lifts all boats and so even before the fund was institutionalized, Steve kind of wanted to take this idea like a true founder and really pressure test it. And so he got a big old red bus, an rv, and drove it through a couple of different cities to see, you know, what these entrepreneurial ecosystems look like, if there are great founders and businesses and if these are ultimately investable companies. And so I joke that we were born from a bus tour. And so the first bus tour was a resounding success. And then every year since, for 10 years, we held bus tour where we traveled to five different cities. Raleigh, Durham was a stop, I think in the 2015 bus tour year, if.

00:05:49 - Scot Wingo
I. Yeah, it was there, it was fun. They went to the governor's office.

00:05:52 - Mahati Sridhar
Yeah, yeah, it's super cool. So you pull together a ton of stakeholders, those that are in sort of like the state and local like regulation facilities, any local investors, local startups, ecosystem players, academia. All of these pieces come together to really help build a successful ecosystem. And so that's what the bus tour really helped celebrate. And we saw lots of promise from that. And so in 2017, we formally became Rise of the Rest, a fun vehicle. All of those initial investor investments are contributed assets into the first fund, and we're currently deploying out of our second fund. So same thesis. I just don't need to show up to my pitch meetings in a big old red bus, which is awesome.

00:06:33 - Scot Wingo
A little bit handy. Yeah. Have you ever driven the bus? That seems like it'd be hard.

00:06:38 - Mahati Sridhar
I never have. So the actual physical bus was retired the year before the pandemic and never really came back after. I keep wanting it to come back. So, you know, jury is out whether or not it'll make a surprise appearance at some point, but I, I really hope it does return.

00:06:56 - Scot Wingo
Yeah, the. So you gave us a really good thumbnail of the firm and your investment area and whatnot. Are there any categories, like do you guys do. Do life sciencey kind of things that require like drug discovery and like hard bioscience type things, or is that a category you're not involved in?

00:07:14 - Mahati Sridhar
Great question. Not really a category we're involved in. We did some of those investments previously, but we've moved away from that strategy just given like the heavy regulatory environment that surrounds that as well as, you know, when you think about an enterprise SaaS business and you think about a life science business, the arc at which you invest into those companies is really different. And so for us, how we're thinking about portfolio construction and just sort of like where we want to be spending our time and sort of our subject matter expert network and you know, how we can add value. It's just really not in life sciences or in biotech businesses.

00:07:47 - Scot Wingo
Yeah. And then I didn't prep you for this question, but in the Triangle, I know you're in Prion, which we're also in, that's going to be, you know, hopefully, knock on wood, that's going to be a good one. And actually here soon the Igor interview will drop. So you'll get to hear from Igor. I'm sure you've met him several times.

00:08:05 - Mahati Sridhar
Yeah.

00:08:05 - Scot Wingo
Any other North Carolina companies you can kind of highlight that you guys have invested in?

00:08:09 - Mahati Sridhar
Yeah, so we have a couple more North Carolina companies, K4Connect, a little bit of an older business that's also out of the Triangle. They focused on really being able to level up senior care facilities and senior living, leveraging technology to drive better efficiencies in those businesses. One that we have exited that I'm sure Scott is on your radar. Archive Social, so Anil Chabla's business that was based out of AU in downtown Durham, Flurry is another business that's based out of Winston Salem that sort of rounds out our North Carolina cohort and.

00:08:41 - Scot Wingo
They'Re doing well as well are those guys that do like a creation of images and stuff for E commerce.

00:08:49 - Mahati Sridhar
So what they do, I'm not a different business. Yeah.

00:08:53 - Scot Wingo
I have to go look up Flurry and then this is exciting. So Anil from Archive Social is going to be a fellow selection committee member. I don't know if he'll be on the same individual selection committee as you, but yeah, he's going to join us as well.

00:09:06 - Mahati Sridhar
Fun fact. I interned for Archive Social when I was an undergrad, so maybe dating me a little bit, but that's kind of like a very fun full circle moment of working at one of our startups before it was one of our startups and now, you know, being a part of that, the other side of the cap table journey.

00:09:24 - Scot Wingo
So yeah, I think it's interesting you kind of knew you're, you know, I don't know what you knew when, but you, you had an inkling this may be something you were interested in this entrepreneurship. Where, where does that come from? Like this interest in entrepreneurship?

00:09:38 - Mahati Sridhar
Yeah, I think when I was an undergrad student I got exposed to the entrepreneurial ecosystem pretty early. You know, AU just seeing what launch UNC was doing. I think around the time the entrepreneurship minor at Chapel Hill was just coming into fruition. And for me, I really like the idea of taking, you know, making something from nothing and looking at a problem and being able to create something that addresses that in a really value, value driving way for big, small, any sort of like problem. And the energy, I think like in those types of communities is what continues to keep me coming back. And I think especially as an investor, something that we're always looking for are good people first and foremost. That's what we're looking to invest in. And for me, just like surrounding myself by good people regardless of what they're building, that's kind of what my focus is and that's, I think, what's continued to keep me in the ecosystem and in the game.

00:10:34 - Scot Wingo
Yeah, and I was at, I forgot what event I was at, but your father was there and I got to spend some time with him. It was funny, it was cute. He was so proud of you and you were like, so like, oh my God, shut up, dad.

00:10:45 - Mahati Sridhar
He's also now in the startup ecosystem after being an IBM exec for many a year. So excited for him as his retiree phase, you know, if you will.

00:10:55 - Scot Wingo
Yeah, yeah, very cool. So in your, you know, you've been doing this for a long time and you've seen, I don't know, probably hundreds, if not thousands of pitches. Any advice, advice for some of our folks on, you know, how to, how to deliver an awesome pitch?

00:11:09 - Mahati Sridhar
Yeah, definitely practice it so it doesn't seem scripted, but more conversational. Hit on all the facts. But also don't forget to really showcase who you are, who your team is and sort of the why you're building this, especially at the earliest of stages, at least for our fund. Like we really index on people and why they're uniquely the right people to be building and addressing this problem. We fully acknowledge that whatever solution you present to us will probably change even within the first 100 days of investing into this business. And so you know, like understanding like where your head's at, how you're thinking about it, how you will like systematically approach the problem and sort of navigate all of the obstacles. And that's where I would really hone in and really build your pitch. And I guess like the second piece would be as you think about explaining what your business does, you're in it every single day, every single minute of every single day. You're pitching it to a room full of strangers. And so take it down. You want an elementary level school age child to be able to understand what you're doing. Don't use a ton of jargon, really, really bring it down metaphors, similes, those are all really great ways to like relate to what your business is doing. But just make sure you know if you walk up to someone random in a coffee shop and you explain what your business is, they can say it back to you.

00:12:29 - Scot Wingo
Yeah, I think the people part, I don't think a lot of founders realize that, especially in the kind of area you and I play in, which is this pre seed seed kind of zone. There's this old adage in venture, you know, you either bet on the horse or the jockey and you know, to your point, the, the the person is super important because that's who, who you're really betting on at that point. The you can do these exercises around the tam of the space and stuff but, but it's hard to really know because if they pivot or something changes exactly on the person to navigate it. Yeah. Where do you guys draw? Do you like have a formal definition between seed and precede? Like where is there like some indicator there?

00:13:10 - Mahati Sridhar
That's a great question. So for us we won't invest in, I joke anything that's like a sticky note in a dream stage. So we like to see that the founders are committed full time to what they're building. The there's some semblance of a product that's in place. It's very much like beta, very much mvp, very much in stealth. That's all okay for us. And you don't necessarily need to have revenue, so you need to be post product pre revenue. For us that's a pre seed company. Sometimes we do see pre seeds that have some revenue being generated, but it's not an expectation for us. For seed we do expect revenue. This changes. It's hard to give like a hard and fast like number just because it's so dependent on how you're generating your revenue. So like an enterprise, enterprise SaaS business is going to have like a different, different revenue threshold than a marketplace business or a transaction based revenue business. And so for us we, we like to see some like revenue coming in the door if you have like really great retention or usage figures. Like we like to look at those as well. I always say having like fewer but like raving fans and raving customers is better than you know, spraying and praying but having like really low utilization. And so we really like try to unpack like where you are in sort of that phase. By no means do we expect any sort of product market fit, but just trying to see like initial learnings and how you've adapted the business as a result of that.

00:14:40 - Scot Wingo
Very cool. Interesting. And I imagine your check size, you probably write, you know, typically smaller checks in precede larger in seed is kind of like, it's kind of how I guess you guys think about it too, on that range of check size you have there.

00:14:51 - Mahati Sridhar
Yeah, exactly. We, we have never written a million dollar pre seed check.

00:14:56 - Scot Wingo
Yeah, well, cool. This is, this gives us a really good framework. Any last, you know, advice or words of encouragement for folks that are looking to apply to the contester?

00:15:06 - Mahati Sridhar
Yeah, no. Looking forward to seeing everyone's pitch. Just be your authentic self. This is a great opportunity to get a lot of feedback and sort of learn how to build a great business. And I'm looking forward to connecting with everybody.

00:15:18 - Scot Wingo
Yeah, we appreciate you taking time and it's great to have you back in our local community.

00:15:22 - Mahati Sridhar
Yeah, looking forward to it. Thanks, guys.

00:15:24 - Scot Wingo
See you soon.

00:15:29 - Announcer
That's a wrap on this meet the judges episode. Now you know the minds behind the decisions, the investors and industry leaders who will be putting these startups to the test as Tweener Madness kicks off. They'll be asking the tough questions, making the tough calls, deciding who advances in the bracket, all leading up to the finals in early April. Make sure you're subscribed so you don't miss a single matchup. And if you want to follow along with all things Tweener Madness and the triangle startup scene, head on over to tweenertimes.com also, if you're thinking about launching your own podcast or want to bring professional production to your brand, check out earfluence.com the competition is about to begin and we'll see you soon in the next episode.