Not everyone is born thinking that they can change the world, but most of us have dreamed about it. Entrepreneurs are first and foremost dreamers, but some think so big that they end up having a lasting impact on the world. Steve Jobs saw what Steve Wozniak couldn’t, changing the world of computing and music forever. Elon Musk dared to create a car company despite major competition and a high chance of failure from incumbent organizations, not only dominating the electric car industry but paving the way for self-driving cars.
In this week’s episode we interview serial entrepreneur Praful Mathur to understand how entrepreneurs can learn to think big, and what makes a true visionary. At just 19 years old as an engineering student at Northeastern University, Praful convinced hundreds of taxi owners to partner with him on an unproven software/hardware advertising solution, beating out Verifone, a multi-billion dollar company. Since then he has gone through some of the top accelerators in the word, including Techstars and YCombinator, raising millions of dollars for multiple ventures.
Praful talks about how he went from being a nervous engineer to learning how to sell, and how this new skill and knowledge is helping him execute on his next big ideas. His parting advice? Surround yourself with the types of people you want to be like and think like, and focus on working hard to solve the small problems first to eventually get to your big dream.
0:30 Vadim: Praful is a serial entrepreneur, currently CTO and partner at Comfreight, has raised millions of dollars, has gone through top accelerators like TechStars and YCombinator, sold a venture, and is one of our good friends that always has Big Ideas.
1:15 Sergei: We first met Praful when he was a Junior at Northeastern University – and ever since then he was a guy who had the biggest ideas for businesses and was able to run with them.
1:50 We talk a lot on our podcast about the fact that many successful entrepreneurs have no experience in the industries they start businesses in, and when they first start a lot of people laugh at them. But somehow they end up proving them wrong.
2:00 Because Praful has always been so consistent in thinking big and being able to execute on big ideas, and we wanted to find out from him how he has been able to do that.
2:45 Vadim: When most college kids were thinking of the next hot app idea, Praful was trying to sell software to taxi cabs. What is it that made you think that you should do something like that and gave you the confidence to do it?
3:00 Praful: I fell into it because of a cofounder. I had just been rejected from Y-Combinator with another idea, and my friend was going through some personal problems with a girlfriend, and we were just desperate to work on something that summer.
3:40 We tried a bunch of things, like something in video, then something for employee management for companies. We would have an idea then try to sell it to customers and would see if they wanted it – but many people told us the ideas were terrible.
4:40 One time my friend called to see if I want to do a cab advertising business. I thought it sounded terrible.
5:09 But the next day he called and said, I have 25 cabs lined up in Brookline, MA. So we decided it was worth to try it.
5:30 So this started off as a small idea: can we advertise inside of cabs. It got bigger iteratively. From, can we do a business, then can we do a specific type of business, then learned about ads and thought we might be able to do an advertising business, then from there the friend thought of where there aren’t currently ads and thought of cabs. Then executed.
6:00 Sergei: Did this friend of yours do all the sales to validate the ideas?
6:10 Praful: In the beginning we both did all the sales. Even though I was the worst person possible to do it. We had to.
6:20 I would sometimes call people and hang up the phone when they picked up. I was so nervous that I had to listen to my partner’s calls so I could just repeat exactly what he was saying.
6:30 Sergei: But still, even though you were nervous you were still able to make yourself do it. How’d you get the confidence to do it?
6:50 Praful: It’s like with anything, you start small with small steps that eventually become bigger.
7:00 At that point we were trying to sell to individual advertisers like bars and restaurants and they didn’t want it, but it had already been a year since we started trying different ideas, and we didn’t want to waste this summer trying new stuff because this seemed to be working. So we had to figure it out.
7:48 I wanted to make it work so bad that when we started calling people, I just tried to find any little way I can connect with them. At least about why I was interested in this idea.
8:10 At first I built up confidence by explaining the idea to vendors, then started talking to advertisers about it.
8:47 When some people listened to me probably because they felt sorry for me, I was building up my confidence to talk to more people about it.
9:05 Vadim: We talk a lot on this show about using anything you have to your advantage, in your case you used the student card to get people to listen to you. But how then did you close your first advertiser?
9:19 Praful: It took a while but here’s the agenda we had every day.
9:30 Woke up at 9:00am, had breakfast, then started the calls at 10am, went until 7pm EST because we called to the west coast. We focused on specific industries and got 90% rejection but 10% wanted more info, and we learned on our own.
10:00 It wasn’t until we started calling ad agencies where we realized we had something valuable. The ad agencies basically coached us through how to professionalize what we were selling because they knew what their clients wanted.
10:30 Sergei: so you got into Techstars at that point and then ended up selling the business. How did the sale come about?
11:00 Praful: Because we were inexperienced and didn’t know what we were doing, it helped us focus. We just woke up every day, and went to the people we needed to talk to because there was nothing else we could do.
11:30 Because we had no money we just had to focus on the one thing that would make or break the company, which is sell. At one point we had more medallion owners on our service than Verifone did. They’re a multibillion dollar company so it was embarrassing for them. They had 200 cabs signed up, we had 430.
12:20 At that point there were only a few companies who would want to buy our company and they were very aggressive about getting it.
12:33 Sergei: Did you actually have a product? Because Verifone did. So how did you outsell them?
12:40 We built the whole product in 40 hours of development time.
13:00 Sergei: So you built this software and would plug it into existing hardware?
13:40 Praful: That would be nice. We would have to actually spend $5 Million on the hardware and cab partition redesign to make it work. For 200 cabs it was about $3,000 per cab to build it out.
14:00 Vadim: did you actually deploy this hardware?
15:00 Praful: We weren’t due to deploy until March of that year, and what happened was the recession hit. No one wanted to continue investing in startups because their net worth was dropping.
15:20 Sergei: Did you end up buying the $5M in equipment?
15:30 Praful: No, we couldn’t do it. We were actually worried we’d get penalized by the city of Boston because we had all these contracts. What the contracts said was that the cab companies could only buy this software/hardware from us.
16:30 Sergei: sitting here even now listening to this, it sounds super intimidating. Trying to sell hardware and software to this behemoth of an industry. How did you not get intimidated?
17:10 Praful: We were too stupid to be intimidated. So we just knew what we wanted to do and we had to figure out how to take the steps to execute on it.
18:02 Sergei: Let’s fast forward to after you sold the business. I remember you moved to NYC to work as a software engineer, and when I asked you what you’re working on next you said you were going to build a self driving car.
18:17 This is in 2010-2011, well before most investors were talking about self driving vehicles, yet here you were again thinking of a crazy big idea. What made you decide to work on this over anything else?
18:37 Praful: I had been following the Darpa autonomous car challenge since high school and was thinking about how to do this. By this time it was becoming obvious to me that self driving cars were going to be the future. Uber was around and I knew the Taxi industry pretty well and where the cost was going to, and knew it wasn’t sustainable to just keep getting more drivers.
19:25 Cities are too congested with cars and that needs to change. Only way to resolve this is through small cars that are autonomous.
19:55 Cars were no longer the primary driver of freedom, it was the ability to connect with someone on the phone, which you can’t do while you’re driving.
20:10 Sergei: Yeah but why did you think you’re the one to do this?
20:20 Praful: Because if I didn’t then no one else would. Can’t wait for someone otherwise you’ll wait forever.
20:25 Sergei: Then what was your first step toward starting a self driving car company?
20:29 Praful: Reading as much as I could about what others were doing. Figure out what I don’t know, find people who know that stuff.
21:10 You have to be very deliberate about learning as much as you can.
21:12 Vadim: So as someone who’s a visionary with big ideas, what do you think is the number one skill that a visionary entrepreneur needs to have?
21:30 Praful: You need to not focus so much on the outcome as on the steps you need to take to get there. That’s a mistake that I’ve made and something I’ve had to relearn.
22:29 Sergei: But if the end goal is so far from today, how did you stay motivated every day?
22:50 Praful: At first I was really interested but the self driving car idea ended up morphing because a lot of people kept reinforcing how far away the dream is.
23:15 When you’re around people who continue to reinforce how far away you are, you will just focus on that. If you’re surrounded by people who just focus on the work that needs to be done every day, you’ll do that. When you’re around people who think no idea is too big, you will continue to think bigger and bigger.
24:00 Vadim: If you want to change who you surround yourself with, how do you start that process?
24:04 Praful: Go to wherever you may be most successful in finding that community.
24:15 You only really need 2-3 people who reinforce your desires. Even what you said in the beginning, us being each others champions, that goes a long way.
25:20 Sergei: Then how do you know whether you’re thinking big or you’re being delusional? and does it matter?
25:24 Praful: The difference between delusion and vision is execution.
26:20 Sergei: But ultimately, changing the idea to be a bit different did lead you to ultimately get into YCombinator and raise several million dollars. So what did you change in your approach?
26:48 Praful: We started thinking about where can self driving cars be most useful and we decided on logistics and cargo because more cargo gets moved than anything else.
27:10 A lot of problems need to be solved before you can get to self driving cars.
27:28 To make self driving trucks possible you first need to have a lot of automation in the warehouses themselves. We realized if we can solve any one of these problems first, it would get us closer to automation than a self driving car.
28:07 So we started to adjust it to be a bit more pragmatic.
28:30 Vadim: It sounds like eventually you need to be able to get other stakeholders to agree with you to achieve the big vision. So if you’re trying to achieve something big now should you pare it down to something more attainable first?
29:15 Praful: The idea that all of these inventors did something major right away with a breakthrough is part of the myth.
29:25 Even Edison had thousands of prototypes before he made the light bulb.
30:10 You have to start really small and iterate until you get it right.
30:30 Edison and Ford could have thought this is too big and we won’t solve it. It is too big if you just focus on the end. But they didn’t. First Edison focused on each component that would make the light bulb work, then the infrastructure to deliver light, then he popularized it.
30:52 Sergei: So you have faith that you’ll figure out everything else later on, and for now focus on what you need to solve today to survive to the next point.
31:20 Praful: focus on what can I do right now with the skills I have and what I already know to bring it to someone who can tell me if I’m on the right track.
31:50 Once we adjusted the self driving car idea, we built software for warehouses, then decided to see who else it would be useful for, then decided to deliver it via an API. So it was an iterative process.
32:30 Sergei: Now you’re a CTO of a company that works in the trucking space?
32:45 Praful: Yes, we’re a finance company for trucking companies to take over their accounts receivables at a discount. The interesting part of this business is how we can create credit markets with cryptocurrency.
33:30 Sergei: So you’re continuing to use your technical skills in another business, but you’re still thinking big and continue to surprise us with your new ideas every time we see you. Tell us why you decided to move in front of the ocean and why that’s related to what your next big idea is?
33:47 Praful: This is definitely starting off as more of a hobby than a company, partly to keep the stress levels low and allow me to iterate more without having to make money with it.
34:13 Ocean levels are rising, global warming is a thing, and we don’t know enough about the oceans. We can try to reverse it or figure out the worst case scenario and adapt.
34:30 I’ve had an obsession with wanting to live under water from a very young age, I don’t know why.
35:10 I need to go under water and figure out what’s happening
35:30 Studying killer whales and how similar they are to us made me realize that we need to study oceans more closely and understand them. This made me think about how we can create a situation where we can actually spend time living underwater.
36:32 The ultimate idea is to build giant submarines where we can live and interact with sea life for several years at a time.
37:05 To start super small I started scuba diving, now I’ll start to scuba dive with research groups who work with killer whales. Then I’ll figure out what the research groups need to improve their work and I’ll help them.
38:00 Vadim: There’s a lot to unpack here around what enabled you to think big. When you started with the cab business, you just wanted to build a business.
38:55 Next you worked on ideas like self driving cars which is something you were thinking about since High School. Now you’re also working on something that’s intrinsically interesting to you because you want to do something that’s a lot more impactful.
39:25 Aside from being interested you need to surround yourself with smart people, but also divide it into achievable steps you can take to make it real.
39:50 If someone wants to think bigger, what is some parting advice that you would give them?
39:54 Praful: Start small and iteratively improve. Even if your idea seems small now, you can develop it into something bigger.
41:04 And that’s part of why I live in front of the ocean now. Part of it is the view because I want to remind myself of the big vision, but ultimately I need to find a way to make it real.
How To Think Big While Starting Small With Praful Mathur
Hosts: Welcome back to The Mentors!
Vadim: This is Vadim
Sergei: and Sergei
Vadim: and this is a show where we tell stories of ordinary people that became extraordinary entrepreneurs despite having lack of experience, money or connections and we found the most ordinary person that we could for you off the street. No, I’m just kidding. Today actually we’re really fortunate to have my good friend Praful Mathur. Did I pronounce your name correctly?
Praful: Yeah. Praful Mathur.
Vadim: Praful Mathur
Sergei: Wow! how long have you known Praful, Vadim?
Vadim: About 10 years but he never told me his last name until now. So Praful is a serial entrepreneur and techie, a technophile. As a matter of fact, he has started several companies, has raised millions of dollars, has gone through some of the top accelerators in the world including TechStars and YCombinator. He’s sold companies and now he’s a CTO and partner at ComFreight.
Sergei: Praful, We’re really happy to have you on the show thanks so much for coming on.
Praful: This is awesome! I’ve been listening to some of your shows since the beginning so this is awesome to be part of it now.
Sergei: You’re just saying that.
Praful: No, I do. That’s what we were talking about earlier.
Sergei: No, we appreciate your support and thanks a lot. Yeah
Vadim: We’ve been in each other’s champions for a long time even when maybe we shouldn’t have been. We wanted to have Praful on the show today because ever since, consistently, ever since we met Praful 10 years ago when he was, i think, a junior at Northeastern University. We have recently graduated from Bentley but ever since we met him he was one of our friends who had the craziest, wildest ideas for business and somehow was able to run with them, even when he had no business in starting them. We talked a lot about it on our podcast that oftentimes the most successful entrepreneurs don’t actually have any direct experience in the industry that they’re starting a business in and most people
when they look at them or hear their idea they laugh at them. But they end up proving them wrong and so. Because he’s been so consistent about thinking big and then being able to execute on those very very big ideas, even since he was 19/20 years old. We want to tell you and find out from him how he did it and how he had the confidence to do that from such a young age.
Sergei: So we work with a lot of college students and when they think about Venture creation their minds kinda go to one place- I wanna start the next hot app or they’re thinking about problems that most college students have. When you were in college, you came up with a business that was selling to cab companies in Boston Massachusetts. Something that’s inherently difficult to do but here you thought, “I can do it”. So I guess, What made you think that you could attack a market that’s difficult to attack and why do you think you were able to think big when all of the students were just trying to come up with the next Reddit or I-can-hash Cheeseburger or something like that?
Praful: It’s actually an interesting story. So, that didn’t happen through my own development right? Like a lot times when you’re starting a company, you’re starting it with a co-founder and so if I had to bring it back a little bit, I had applied to Y combinator at that time and I had not gotten it. At that time, it was just Paul Gran, Jessica Livingston, Paul Morris.. or Paul whatever their name.. Robert Morris
Vadim: A couple of Pauls
Praful: I got rejected my friend had some personal issue with some girlfriend and he wanted to prove her wrong. Together that summer we were like man we have nothing and we both feel like terrible. “How do we like get out of this?”. The idea was to start a company because you know, basically, we both fantasized about it and we both came up with a bunch of ideas. I wanted to do stuff with like video because I was looking up the MPEG 4 standard; as people try to do. They read through technical docs. I thought that was a good idea and through a bunch of iterations we tried a bunch of things, right. Like we started with try to get advertising embedded in tv shows. We tried to create a new site for some reason we tried to create things that we thought we were going to use. But none of them quite panned out like the way that we iterated through that was we started with an idea . We first found customers that would pay for it and then we would try to see if they would validate our idea. And a lot of people just told us our ideas were terrible so we iterated through a lot. Then people started giving us ideas and we started going with them and we had no idea what we were doing we just wanted to do something because both of us were just miserable. One day during college this was just summers passed we started classes. He called me and said, “Hey do you want to start a cab advertising business?”. Then I said “That sounds terrible. It sounds nobody would want it.” “It works really well In New York.” I said, “Cool, keep me posted.” But we’re already working in this other company you which was like help managers manage their teams better I don’t know it was weird the stock market (inaudible). It didn’t make any sense and I was really excited about it because it was a strong technical problem. The next day he called me and said hey I have 25 cabs lined up in Brookline Massachusetts, which was close to Boston. I was like “Okay, well we should do that.” Like we have a customer, we have
something that could go with it. so it really started off like a really small idea which was “Can we advertise inside of cabs?”, and the way I got bigger was iterably. We started off “Can we even do a business?”. Then it went “Can we do a specific type of business?”. Then he was in class one day and he learned about advertising models. Then he is like “Maybe we should do something in advertising?” Then he’s like “Where’s that one place advertising hasn’t hit?”. and guess he came up with cabs. Then from there, we went to “What else can we do?”, right. Then we started Brookline then we started to move to Boston It’s like where the story really got interesting.
Vadim: So it sounds like you didn’t care so much what kind of idea you just wanted to be an entrepreneur and then you were just thinking of stuff and trying to execute on it. So was this friend of yours the person that was going out and trying to do the sales and validate?
Praful: We at the beginning both did sales. Um, I was the worst possible person behind the phone. Um, There were times I literally called someone they answered and I hung up. And I was really nervous. I did know how to quite talk to people who wanted to know the idea. I had to actually like, tried to listen to my co-founder on calls and record him and then just repeat back word-for-word what he’d said just ‘cause I was so nervous.
Sergei: But still, you were able to make yourself pick up the phone and call, even though sometimes you would hang up. How did you make yourself do it? How did you get the confidence to do it?
Praful: Ah, it’s a good question. Ultimately, and this is with everything it starts with small steps and it eventually becomes bigger. I picked up a phone, OK so what actually happened is, right after we got the Brookline cab signed up, we went to a bunch of restaurants and bars in Brookline near the cab company and we asked all of them if they want to advertise. A hundred percent of people said no and they’re also sort of probably the worst idea they heard their lives. But that’s how I, I was like, we need to do something. A full year had gone by we tried to do a bunch of ideas – this is the summer after – and this is the one that stuck. And so I said, hey, like, let’s just go for it and see what happens. We have an entire summer to iterate through this. Let’s try not to blow it by coming over with bunch of ideas like we did last summer. We have something that has legs so let’s go for it. And what happened is I wanted to make the idea works so bad that what I did is, when we started going into bars, we started talking to people in person, and we started calling them, I just tried to find little ways that I can connect with them and there wasn’t a lot for a 19-year-old kid with very little experience and just mostly obsessed about tech. I tried to connect to people about why I was really interested in this idea. First, I started with people around the technology that we’re using and finding vendors for our system. Then when I started confidence there, then I started calling other people and I said, “Hey we have this idea of advertising in the back of the cabs. It’s with a television screen. It’ll allow you to get your word out there much better.” I sound much better than I did. I stuttered through every word. I was really nervous and some people were like, “No and call me back in a year.” and I said yes and I actually did call these people back in a year. But the big thing I think that helped me get over it is that when some people would just talk to me because they could sense that I was new and they may have taken pity on me or they were just like trying to humor me for some reason. They thought it
might have been a college project or something and I think that got me the foot to be confident enough to do it.
Sergei: And we’ll talk about use whatever you can to your advantage in this case, you were a college student but also you identified that in some cases they just kind of resonated with you and the story that you told and that’s what you capitalized on. How did you end up actually closing the first advertiser?
Praful: Yeah, so it took a while and it took a lot of calls. We actually had a pretty interesting an agenda everyday. We would wake up in the morning; he would wake up at 8 and he would wake me up at 9. Then we would get breakfast and start the calls at 10 a.m. Eastern Standard Time, go all the way until 7 p.m. eastern time because it was 4 p.m. Pacific time. So we would go from the East Coast to the West Coast. Then we would call a bunch of people in our list. We’d focus on a specific kind of industry with all the companies and we would get I think 90% rejection and then the 10% who didn’t reject us were like “Give us more information.”, like a Media Kit or whatever and a lot of that was learning a bunch of stuff on our own. It wasn’t until we started going into advertising agencies that we realized we had something that was valuable. Before that, we were calling restaurants, bars. We were calling random businesses. We were calling pet grooming centers; anybody we could call. And it wasn’t until we started talking to advertising agencies and they started telling us about media kits and they started telling us about how to professionalize a business and there was people in advertising agencies that wanted what we could sell and they started coaching us through this stuff.
Vadim: Now you ended up going to techstars at some point now it was a fairly new program But one of the top two in the space as an incubator accelerator at that time. You got a little bit of money you raised how much 50K From AngelList was it?
Praful: Yeah we raised 50k at that point.
Sergei: 50K. And then you ended up selling that business. How did the sale come about?
Praful: What was really interesting was we started off as like these like we had no idea what we were doing as college kids and by the end of it became fairly sophisticated understanding that specific space. And all that came down to was we just woke up every single day went to whoever we needed to talk to and just focus our efforts there. We didn’t do anything else because there was nothing else we were good at, right? So there wasn’t this thing like, “Hey you know there’s 50 things that we should do.” It was like, “Hey we have one thing that’ll make or break this company. We have no money; only thing we can do is sell.” And so we became very good at selling and at one point we had more cab drivers, or “Medallion owners”, technically, who had to sign up to our service then Verifoned it. And Verifone’s a multi-billion dollar company that will do whatever it takes to win and tt was embarrassing for them that they had a startup of 19 year old kids that they knew raised less than a million dollars because they didn’t have any SEC filings or business name. And we just crushed them. They had 200 cabs lineup we had 430, right? And it was very embarrassing and so
there was a few people we could sell our company to and they were very aggressive in getting it.
Vadim: But did you actually have a product ’cause you said you were selling the whole time. Did you actually develop this television screen or this system that could show advertisements? ‘Cause verifone had a product. How did you solve this if you didn’t have anything?
Praful: We actually built everything in 40 hours in development time. So we had a team of three people we worked maniacally around the clock. If we’re not working, we were in class and if we weren’t in class or working, we were asleep. So all we did all day everyday, was we worked on different parts of the businesses. So as the sale started to get off the ground, we started to validate. Okay, advertisers really care about this This is what they want. That basically they wanted Google AdSense for out-of-home advertising. That still doesn’t quite exist today. Um, which Is metrics oriented– how many people are seeing it, what’s their retention, what’s their level, like all of these metrics — then we started building the product. Then the product was written in Python. It was very crude. It was built with a library like I don’t know if it’s still around . We just did whatever it took to make it like I hired a friend from class who turned out to be one of the best programmers in school and in like less the amount of time it took for them to put an update to their software, we’ve built the whole thing from scratch.
Vadim: So it was software that you could plug into existing hardware that cabs already had. So all they had to do was use your software.
Praful: That would be nice. *laughs* Um, we actually had to buy 5 million dollars worth of equipment– we had to have the computer in the system we had to have TV screen, we had to have a partition. Now, Uber’s everywhere but if people had taken a cab, you’ll know that there’s a partition and that partition itself is $2,500 a cab. You had to change it because it doesn’t work in every single type of partition. We did make it to work for both powered and non-powered partition. It doesn’t really matter the difference but the point is we spent a lot of work trying to make it work with a lot of partitions. Even the,n we still needed to install new ones, we still needed to install the computer under the seat, we still needed to wire the whole thing. So per cab, we were looking at about 200 cabs, it was about $3,000 a cab to install everything
Sergei: And you actually deployed this? This was live?
Praful: No. The deployments weren’t going to start until March of the year. Turned out at got delayed until June. There was a bunch of delays but what happened was that when the medallions signed up we were ready to raise money. The challenge of raising money in this time period was that, it was 2008/2009, so the economy had collapsed and people weren’t sure if we were going to go back on our feet. And so we had investors that literally said, “I can not invest because I lost an entire percentage of my net worth this today.” I mean we’re not talking about like investors were generally not like regular people. They have millions of dollars in their name. The people who supported us for friends and family but even they were
nervous about what was happening to their net worth. A lot of people we talked to were like um, Cash rich but they don’t really understand startups and around the same time we were raising, Sequoia had released a Block Deck, which was “Hey you shouldn’t invest in a new company, you should just double down on the ones you already invested in.”
Vadim: So to be clear though you didn’t actually end up by 5 million dollars of equipment, right?
Praful: No, we could not. We were actually scared because we had so many cabs signed up that if we weren’t able to deploy, we would have Financial penalties from the city of Boston .
Vadim: What does signed up mean? Do they actually pay you?
Praful: Um, Signed up means that we legally had a contract that we were the only people who can install this equipment in their cab and they had to use our system only.
Vadim: So the reason why I’m focusing up so much on this, we’ll to move on from this business in a second, is that to me even sitting now it sounds kind of scary. Like the whole process of selling hardware and software to this crazy behemoth of an industry yet to you, it wasn’t scary or maybe it was and you looked past it. Tell me how it was possible that a 19/20 year old wasn’t intimidated by that or at least how did you shut that away if you were intimidated.
Praful: You’re too stupid to be intimidated, right? What you don’t know will not kill you and in some cases it will but then you’re dead. *laughs* Um, the way we that got over it was we just worked. Like there wasn’t a thing like, “Oh this is a software and the hardware business inside of a taxi industry.” It was like, “Hey this is what we want we want to do. What is the step that we have to take to make this happen?”
Vadim: It sounds like you’re focused on execution and the secret there is just hard work. Most people wouldn’t get up at 9 or 10 a.m. when they’re 19 years old to cold call all day until 7 p.m. and then go to class. It’s just simply not what people are willing to do but I guess it was your desire to start a company that pushed you through what most people would give up on.
Praful: Yeah, I was rejected from YC and my co-founder had been rejected by somebody and we both wanted to prove that we could do this, right — not to them but to ourselves. And at the time we were both also trying to pick up women so we thought this was our way to get them, right *laughs*.
Vadim: That’s a great motivator. Let’s fast forward to a couple of years where you graduated you moved on from this business. I remember you moved to New York and you were working as a software Engineer while trying to get your next wild idea off the ground. And I remember asking you, “What you’re working on?”, and you said “Oh yeah, I’m going to build self-driving cars”. And I’m like, “What the hell are you talking about man?” And this is
Praful: Way before, yeah
Vadim: And this is like 2010/11 when self-driving cars were not really on anybody’s radar, maybe on Google’s radar and that’s about it. Investors were not actively talking about it. So how did you come up with this new idea? This is again a huge crazy idea that most early twenties people wouldn’t think of. Was it just like a personal interest and then you’re like Okay, I’m going to do this? Is this again a case of you trying to prove that to yourself that you can build a big massive company or were you just pompous? *laughs*
Praful: So at this time what had happened and I remember talking to you about it. I’ve been following the DARPA car challenge for quite a while. The autonomous car challenge where they were getting a bunch of teams to drive through the desert fully autonomously and I was starting to follow that in High School and I was thinking about it for quite a while. Like, How would you do this? How would you create a self-driving car? And by this time, it was becoming more and more obvious that Self-driving cars were going to be the future. Now, I don’t know why it was so obvious to me but it started to become more obvious like Uber’s around, Lyft’s around and these business models needed to work at scale like they can’t keep hiring all these people. I knew the taxi industry pretty well. I knew like where the cost was going to. And so to me, cities, you shouldn’t be driving cars. It’s too congested. It’s too weird, too like me going around saying, “Hey I’m going to have an SUV in New York City or San Francisco”. So I was like, the only way to resolve this is small cars, micro-mobility is what the term is now or Urban mobility, and completely autonomous. ‘Cause I mean people want to be on the phones. Like when you started to look at the number of fatal accidents increasing because of cell phone usage, you know that that culture had shifted to cars not being the primal driver freedom. It was really being on a cell phone, to your friend and I mean I’ve seen a footage of somebody live streaming on Instagram and rolling over a car and killing her sister and so that is starting to happen more and more and self-driving cars is the only solution to that kind of problem.
Vadim: Yeah, but why did you think you’re the one to do it?
Praful: Oh, if you don’t do it no one else will. I mean that’s the entrepreneurial freedom, right? Like if you wait for others to do something you’ll wait until you’re dead.
Vadim: So then what was your first step in starting a self-driving car company?
Praful: Reading as much as possible on every. Um, so figure out who the winning teams were on The DARPA challenge, figure out what they did so read their white papers, understand what you don’t know, find people who know that stuff. So I started a Meetup Group for people to come-by. Started off really great. Started off with 75 people. Um, ’cause they thought we had a self-driving car and they came… left very disappointed. *laughs* Um, but from there, we found people who do pieces of what I needed to learn. I ended up meeting someone who had worked on a Google self-driving car and from there, more and more pieces come together and I think you just have to be very deliberate about learning as much as you can.
Vadim: So clearly you’re a Visionary but also you have a lot of skills. At this point you’re CTO so you have a lot of technical skill. You have been the block as a sales person as well. Having started multiple companies now and being a visionary, which is not whatever everybody can say about themselves, what do you think then is the most important quality for somebody that starting a business or somebody starting a business that they think might have the chance to be big?
Praful: This is what I messed up a lot and it goes back to your question of like how do you not get intimidated. In the last company, I started in YC and even in some of the more recent efforts I had, you start focusing too much on where you want to be and not what you have to do and I think that what I am relearning constantly is that you just have to put your head down and continue to work and not worry about the end goal, right? Because the end goal is nice, the vision is nice. It gets people around you working and it gets people to join the dream but at the end of the day, every day you have to do something to contribute there.
Vadim: But if the end goal is so far like I think about this sometimes where Elon Musk, for example. The end goal for getting people on Mars is so far. For you starting the self-driving car company knowing there’s so many technical limitations to getting self-driving cars on the road. The end goal was going to be so far from today. Then how did you stay motivated just day in and day out since it was so far away, that gratification?
Praful: Well actually the self-driving car company ended up morphing. And that ended up coming… So at first, we were really interested in building towards it and we’re getting stuff going but then what ended up happening is a lot of people kept reinforcing how far away the dream was right. And that’s a difference I think is inherent in the the world of New York versus San Francisco is that when you’re around people that continue to reinforce how far away you are, you will just focus on that. When you’re surrounded by people who just focus on the work that needs to be done day to day, then you’ll focus on that. When you’re surrounded by people who think that nothing is too big, then you’ll continue to think bigger and bigger. So a lot of it comes down to who you surround yourself with. In college with Amp idea, I was surrounded by people who didn’t know any better except like we need to do some work. In New York I was surrounded by people like this is impossible, this will never work, and that’s why we ended up morphing the idea and now back in the West Coast people are continually reminding me that I’m not thinking big enough.
Sergei: Interesting. So then, if you want to adjust who you surround yourself with, how do you proactively start that process?
Praful: Go to where you’re going to be most successful in finding that community – that can be- I mean New York has big thinkers. Like if you think about the world crypto or you think about the world of Finance and so or any of that stuff. That got invented here. Like a lot of the early Silicon Valley investors come from New York. Not a lot…. It’s not that people here think Small, it’s that they think big in realms that you have to also be excited about. If you’re thinking big in tech, then go to Silicon Valley right. You can find communities locally. You could go to your college and find a bunch of people, you only need two or three people, that that reinforce your desire. You could do it by yourself and meet everybody online but being
physically present in like getting dinner and drinks. Even just our relationship as you mentioned in the beginning like continue being cheerleaders for one another. That actually goes a far like takes you very far versus surrounding yourself by people who are like “Yeah, this could work if we were Google or this could work if we had billions of dollars but it won’t work because we’re who we are today.”
Vadim: So then how do you know if you’re thinking big or if you’re being delusional and does it matter?
Praful: The difference between delusion and vision is execution. So if you’re not executing then you’re you’re not going to get there. I mean Steve Ballmer when he was at the top of his game talked negatively about both Amazon and the iPhone.And said these are not real businesses they are like just fantasy project. For Amazon, you have to be profitable. For ios or iPhone he said no one is going to pay $700 for a phone. Both are now Visionary companies. But at that time, everybody was like counting them out. If you look through like 20 years of Amazon history, nobody thought they were going to make what they make today.
Vadim: That’s a great point of view. You need if you’re not executing if you’re not making moves and seeing some progress then maybe you aren’t the person to do it but for you, in particular this self-driving car idea, you had worked on for a couple of years in different ways. You help pass legislation in New Jersey that would make it easier for self-driving cars to get on the road but then you did change that idea a little bit because people were telling you this is too far from reality and changing that idea or adjusting or morphing it a little bit did ultimately end up helping you get into Y Combinator and raise several million dollars. So what happened? What changed from the crazy initial idea that you have to then having people behind you. What did you change in your approach?
Praful: So we started to figure out where can self-driving cars be most useful. And we thought Logistics, for moving cargo, because more cargo gets moved in the country than almost anything. And so when we were looking at self-driving cars moving cargo, we started looking at Logistics and we realized there’s a lot of problems that need to be solved before you could get to self-driving cars everywhere, right? You hear the fantasy everyday that self-driving cars are going to replace every truck driver but if you look at the warehouse there’s not enough automation to make a self-driving truck be like this major improvement. I mean it’s going to be major for like Interstate movement but like how do you get to the dock? How do you get to the gate? How do you get to um warehouses where they don’t have a standardized approach for pulling in? Like there’s so many little problems. There are like if you can solve any of these singular problems, then that’s actually a bigger jump towards automation than to build a self-driving truck. That’s not to take away from the companies that are doing self-driving trucks. They’re gonna be super successful but we have a large distance to meet before that becomes the reality for everybody in the United States and so we started to evolve it to become more pragmatic.
S: So then, as you think about big ideas in general and attacking them, have you shifted your thinking in approach now? Because there’s something you have mentioned earlier on is – OK, if you’re thinking big and you want reinforcement of that, you need to surround yourself
with more the types of people that can essentially keep you going and I guess be positive about the fact that you might be crazy. Uh, if you want to be more of the executor, again, surround yourself with those type of people. At a certain point, it sounds like you need to be able to get other types of stakeholders to agree with you so that you can then start realizing your big picture vision. So, if you’re trying to achieve something big now, are you saying that at first try, to pair it down to smaller more achievable problems and focus on those?
P: We’re trying to solve something really big that you have to start small, right? You have to start with very small steps to validate it. The idea that like that all these inventors like bet the farm and did something major like ground zero with a breakthrough uhm, is just part of the myth. The reality is that uhm, you know, Edison had thousands of prototype before he came up with lightbulb, right? Like, he brought that up specifically to show how hard it was. And he also didn’t start to popularize the light bulb until he could get the electric grade into play, right? And then he started to research ways to do that. Then there’s the debate between Tesla and Edison, but the point is, like he thought through like what is it gonna take for people to use my idea – he started small and ended up like changing the whole way we think about electricity and light and he built a business out of it. Now whether or not he’s a bad manager, whether or not he’s like the best scientist, doesn’t matter. We’re all here today, able to like record this at night because of Edison’s deliberate drive ahead. Now, that’s how I think everything it started – you start really small and just iterate till you get it right. Then you do the next thing, and then the next thing, and then the next thing. Coz at any point, Edison or Ford or any of these major business people could’ve kinda stepped back and said this is way too big, we’re not gonna solve it. And it is if you’ve just focused on the end. If you focus on like, hey for this lightbulb, what is the type of material I need for the filament to make this work, right? And that’s all I focus on. Like everything else kinda figured it out, right? Like how do you keep the light on long enough?
S: Interesting. So you have faith that you will figure out the bigger things down the line? The bigger abstract problems down the line? But what can you figure out right now and at the same time, how can that provide enough value for somebody that will actually have this be a business that can survive to the next point?
P: Yeah, that’s what I’ve constantly struggled with. It’s like, moving out of the research lab and being more of an entrepreneur. Like what ends up happening is when you be more Edison less Tesla, right? Instead of focusing on everything that can change the world, focus on exactly what you said – what can I do right now with the skills that I have, with what I know and maybe you need to learn a little bit but I can bring it to somebody and they can tell me whether or not I’m on the right track, right? The hard part about the self-driving car thing is that, uh, the approach I took there which was not super productive was at one point, it’s all or nothing. I learned everything and I went out to make a self-driving car. That is not the way I did go about it. Uhm, but when we started the next company, it was a lot iterative which is like – hey, now we have something that works for warehouse as a software, can we expand it so that other people can use it? Then we started to extend it like, OK now other people can use this, can we make it an API because that’s the more natural interface and this is like thing. Then we were like can we build a website around it. It just kinda like kept growing and growing. But uh, yeah, I think that’s the right…
S: To clarify for our audience, that big idea of self-driving cars then more of into this idea of autonomous robots that can be used in warehouses to help with logistics then you started a company around that and of course now, there are robots being used everywhere in Amazon warehouses and other companies so that definitely was a good idea and I think that’s part of the reason you were able to raise funds around it. Now you’re a CTO of a company that does logistics for trucking?
P: Yes, we are finance-company and a logistics space and what we do, is we buy invoices or accounts receivables from truck drivers at discount. But the exciting part there is how you do this at scale – how’d you do it without, uhm, with some of new technologies that come out today, right? And I think we’ve spoken about this a little bit, like what’s excitement around crypto, not the currency aspect, but like how do you create credit market around this. So can you build more of like a Goldman-Sachs that doesn’t need to be Goldman’s – like do you go to Goldman-Sachs?
S: So sounds like, you’re keeping busy and continuing to use your technical skills and your development but still thinking big. I know that you just moved into an apartment in Long Beach overlooking the ocean and there’s a deeper story here of why you decided to live in front of the ocean? Praful recently, after becoming certified scuba diver became obsessed with killer whales? Tell us about your next big idea because I would never think of this concept and somehow you did and you continue to surprise use everytime we see you about this next crazy thing you were thinking about.
P: Yeah so, this is definitely starting off as more of a hobby than it will be a sa company and there is two reasons for that. One, when you keep things as a hobby, the stress is way way way lower, and you can be more irititive about it rather than jumping in like I need to make a ton of money all of a sudden with this. I’ve been leading myself down with this line of thinking for a while, which is at ocean levels are rising, we don’t know enough about the ocean, global warming is a thing, and so we can find ways to reverse it or we can try to figure out what’s like the worst case scenario where ocean levels are higher and we now are flooded, and now we have to figure out what to do. So part of it was, I have this obsession of wanting to live under water from a very very young age, I don’t know why but I wanted to do that for a long time and part of it was that as I was studying artificial intelligence, I was like okay what are the most intelligent lives lifes on earth besides human beings and it came to killer whales. So a lot of stuff just kinda came together the same which was like I was thinking of all these different ideas with global warming, climate change, killer whales, and artificial intelligence, okay I just need to take the plunge, literally. And I need to go underwater and figure out what’s happening down there, so I started to like watch a bunch of Netflix documentary and started to get myself to like really ramped up about like killer whales and started to read research papers about them, and I realized they have a lot of similarities to us, and then what was really striking was the documentary “Blackfish” and how they ended up like having some hardship when you remove whales from a tantin, so I started to recognize that there might be something here that were missing, that we need to study this more intensively and we’re not doing that, and the way to do that is to actually live completely underwater for a long period of time in an environment that is both friendly to
human beings and to these animals, and also to get used to living underwater because at some point I think it might be necessary for the human race to do so. So it goes back to how do you start small and then iteratively get bigger. The idea you want me to bring out is that I want to build a submarine company that allows you to live underwater completely for 2-3 years of the time, a very big kind of surrounded by a glass so you can see outside, and the outside can see you, and you can constantly study it and under be a pressurized chamber which you can allow whales or other life forms to come inside, so you’re still breathing air and there in the water, and you can study these and touch them directly. That idea came from the fact that when I went to Sea World one time when I was a young lad, I was able to touch a killer whale- alive, and it was like the strangest feeling ever, and I remember asking her like “do you ever get scared that they’ll eat you?”, and she looked at me like very afraid that that was true, but she tried to brush it off like “no, these guys are trained.” but it seem to me that moment that like these are the most powerful intelligent animals in the ocean we know so little about them except for what we know and captivity, and to start super small and started scuba diving, now I’m gonna start scuba diving with research groups that work with killer whales, then I’m gonna start scuba diving with research groups that work with like dolphins in the Bahamas, or where they go, then it’s to find out what are the things that they need would improve their research. I know a lot about data signs, AI, so can I apply that learning to understanding dolphin vocalization, then start you know establishing a community that can help me understand where I can take the next thing. Maybe it’s not a mega yacht submarine that’ll take some time but maybe it’s like a smaller research submersible that we go and study animals for a longer duration of time then it’s normal, I’m like then we just kind of iteratively build up until we have a research community, we have a revenue, we have grands, we have all this stuff built up then we can say “hey let’s spend 100 million dollars building a submarine.”, not “let’s spend the next 10 years looking to raise that much money.”
S: Well its sounds like theres gonna be a lot of swimming with killer whales in your future. I got to ask the other next of kin, if not, can you name us in your (laughter)
P: Uh, no… I don’t have next of kin, I don’t have a living will but you can take some of my possessions after my brother takes them.
V: Perfect! Well, there was actually a lot that was uncovered here. I think that in order for you to think big, which we think is really important, there’s a couple of things that happened. When you started off with the Cabs, you just want to build a business and so because you didn’t really care and you were really young and naive, you probably just thought as big as you could because you didn’t know anything – and that helped you. You intrinsically (38:43) instrument in building a business and that alone allowed you to push through. The next time around, when you want to start a self-driving car, you mentioned, you were interested in this since high school. So clearly, you had been reading about it, it’s in your brain. Maybe, that’s why you even take up coding classes and became an engineer – because you are inherently interested in it there; so there’s an interest in there as well that kind of propelled to think about that. Now, again you have some (39:04 don’t know what word) interest because you are, you want to do something a lot more impactful and given climate change, given the current administration, and given the rad hole that you’re just diving into now, you are exploring different ways that you can potentially have that impact and that interest again, is
driving your big idea. But, aside from being interested, it sounds like you also need to surround yourself with the right people. But then also, pair it down to a small problem that’s more achievable you can solve now to ultimately get to the big goal. Would you say, those are probably the fundamental characteristics of what you need, how you need to think in order to think big more consistently? ‘Coz if somebody is out there listening and they want to be better at thinking big, what are sort of parting words that you would tell them?
P: That it’s exactly right, like, start small iteratively improve; and even if your idea seems small today, it may actually not be as small as you think when you build it up. Like, AirBnb was just literally air beds on a floor and breakfast. But they now iterated into a multi-billion dollar company that’s now the most well-known and most established out of the wide commoner community. A lot of things start very small but once you achieve that, you’ll be surprised at how fast that expands.
S: And I think even the way you unpacked your future plan of having underwater submarines where we all live underwater, you have like uhm, I mean, a multi-year, maybe even a multi-decade plan of how you might get there and you have actually concrete achievable steps that you will take and then you also now open-minded enough to know that it might morph into something a little bit different at a certain point. But this big idea is what seems to keep you interested and what keep you anchored. So when you wake up every morning and thinking about this idea like, what do you think about? Do you think about the next step? Or do you think about that big vision?
P: It’s always fine to keep the big vision uhm, which is why I’m now living in front of the ocean, along with the view. It’s a constant reminder of what you need to be. At the end of the day, you still need to do something today. It can’t be to think about your vision, it’s to find a way to make it real.
V: I love that. Do something today. We talk about that a lot, Praful just reinforced it. Do something today but allow yourself to think big. Because, again, if you don’t do it, nobody else will. And uh, you almost owe it to yourself because you’ll only live once and there’s not a lot of people out there that A. have a brain that works that way, but B. will ever actually do the hard work and put the pill in the middle which sounds like you’ve been doing your whole career. Praful Mathur, you’re amazing…
S: We love you (:D)
V: and inspiring, and sexy
S: yes. And now you say good things about us
P: This is awesome. I’m so glad that you guys invited me to your podcast.
V: We wanna have you back. I guess, that the next milestone we require in order to get you back on the show is have the prototype of this submersive submarine?
S: Well, the cool things is that it’s going to be the first time recording on record and hopefully a publication on record where you talk about this in 20 or 30 years, when this is a real thing. We can say that we are the first ones to have you on the show so thanks for coming, Praful.
P: Thank you.