SaaS Interviews with CEOs, Startups, Founders
$500k Consulting to $45m Prop Tech VC Fund
03 Aug 2021
Chapter 1: What is Kunal Lunawat's background and how did he start Agya Ventures?
If you're confused about your value proposition and where the product's headed, it's very tough to convince that to someone else, be that to an investor or to someone in the sales cycle.
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Hey folks, my guest today is Kunal Lunavet. He's building a company called Agia Ventures. He's built the fund to invest in the future of the built world. Kunal, you ready to take us to the top? Awesome. Thanks for having me over, Nathan. You bet. Thanks for coming on. So just to be clear, this is not a SaaS company. You're building a fund, correct? That's right. It's an early stage VC fund. Okay.
And are you investing in any SaaS companies focused on the space or no?
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Chapter 2: What is the investment strategy of Agya Ventures?
And then you've got the large private equity funds that are buying 10,000 assets at a time. So you've got the whole spectrum. There are certain markets for sure where the large private equity funds are buying thousands of assets and that's crowding out the market. But even then, if you look at like the total volume of residential sales across the US, that's still a fraction of the total market.
So to say that, you know, larger estate bracket refunds are kind of dominating the US home residential market, I think would be factually incorrect.
Do you believe we're in an inflationary environment with so much money floating around and that's why we're seeing these crazy asset prices?
I do believe that you're seeing some indications of inflationary trends. But at the same time, from a macro perspective, you've never seen anything like this before, the rate at which the Fed's printed money, interest rates at an all-time low. So there's something to be said about maybe this is the new normal.
Yep. Interesting. Okay. How is all of this funding a thesis, a core belief you have about property? And then how is that determining and how is that guiding you in terms of where are you playing capital in the prop tech companies?
I think last year was a watershed year for us in PropTech. Some of the trends that we'd been looking at got accelerated by more than 10 years. And to give you a sense, we divide real estate across a few different asset classes. So when you look at office, this whole trend around healthy buildings and technology promoting healthy buildings has been accelerated.
When you look at residential, the one underlying theme that we are backing pretty strongly is community and having a sense of community and multifamily properties and any technology that kind of promotes that. When you look at hospitality, I mean, the hotel sector was really badly hit. You had occupancy levels at all-time lows across major markets in the U.S.,
And usually it's during those points where the propensity to adopt technology is at an all-time high among property managers and hotel owners and operators. If you look at retail, brick and mortar retail almost, you know, was again struggling. So anything that brings people back to malls and makes it more experiential and technology that drives it is something we are bullish on.
On the flip side of retail struggling, Nathan, was e-commerce was on fire. And as a result, you barely had any spaces in warehouses. So we had warehouse owners and operators come to us asking us for technology product that would make these warehouses more efficient. So that's what we've been looking at across the five to six different asset classes in real estate.
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Chapter 3: How does Kunal define success in the PropTech space?
You write the seed check. I mean, do you get active in product discussions with these founders or do you just sort of write the check and move on?
We love to get active with the founders. So just with the case of Stay Flexy, one of the things we've been focused on is the go-to-market strategy. We've been having daily calls with the founding team. We are looking at bringing on board a couple of pretty senior advisors from the hospitality industry because I think there's a lot of progress that we've made on the software and product side.
Now we want to understand the nuances of the industry and make sure that we are also focused on the top line and the product market fit. So that's been a lot of things we've been doing. We've been helping them with hiring. We're looking to get on board a VP of sales for the team, and we've been interviewing candidates along with the CEO.
And also, this depends on how much the portfolio companies want us to get involved. There are some times where the founder wants to check in once a week, and that's fine by us. There are times when the founder wants to check in once a month. That's also fine by us. Our role is to be available and to be cognizant of what the founder might need and be prepared when he or she reaches out.
Let's talk about the flip side. There's a lot of founders listening right now thinking, maybe I want to go raise my seed round, but I don't want to make mistakes. What's the biggest mistake you see founders make when they're pitching you to write their seed check?
The biggest thing we've come across, Nathan, is not having focus or clarity of being able to communicate what the value proposition is. If you're confused about your value proposition and where the product's headed, it's very tough to convince that to someone else, be that to an investor or to someone in the sales cycle.
And what that also tells me is getting to that level of clarity, which is being brief and concise and punchy, actually requires a lot of work. It requires you to have made a bunch of iterations with the product and with your pitch. So if you're coming in with a brief, concise, punchy pitch, that tells me that you've put in a lot of thought and effort and work towards this.
The flip side to that is a genius engineer that is product engineered his or her way to growth, but can't market herself or shit. But they've got incredible traction metrics. What about a founder like that?
Great question. And you do account for that. I mean, on one hand, you want to have a great salesman or saleswoman making the pitch. On the other hand, you also want to look at the metrics and sometimes the metrics speak for themselves. What we would also often advocate is if you do come across founding teams such as that, where it's like a one-sided a unidimensional founding team.
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