How I Became...

Kelly Yefet (00:01.518)
Today, I know you are the general partner at Antler. So your whole journey, it seems, has been very entrepreneurial through and through. So I'm kind of curious to start with what got...

you into the world of startups and energized to be an entrepreneur.

Naman Budhdeo (00:34.185)
Yeah, that's a great question. Thanks for having me. I'm really happy to be able to talk to you and to your listeners as well. I think one of the things that was really impactful for me for entrepreneurship is I grew around two entrepreneurs, both my parents.

So, you know, immigrated from Kenya when I was four years old. My dad was a professional engineer, started as an engineer and ended up taking over and leading the large engineering practice that he was working for. So a group of 150 engineers. And my mother as well, you know, just a high school degree in Kenya came over here, started a job as a travel agent and ended up buying the five person travel agency she worked for.

and grew that into a 40, 50 person travel organization. So very successful. Yeah, female entrepreneur. So I kind of grew up around that. My question was to my parents, like, how do you come up with ideas? Like, how do you generate ideas?

Kelly Yefet (01:22.443)
Wow.

Naman Budhdeo (01:32.069)
And so going into university, I'd always thought about entrepreneurship, but I thought that maybe doing an engineering degree and that maybe an MBA would maybe set me up for work experience and to be an entrepreneur. But I think growing around it, talking about it at the dinner table with both my father and mother, it was kind of ingrained at an early age of something that I wanted to do.

Kelly Yefet (01:53.582)
Amazing. And were they coming as an immigrant and through some of the podcasts I've had, I've heard is there is a trajectory or a journey that parents want their children to take. Did you find that your parents were very supportive of you wanting to take an entrepreneurial journey? Was there specific roles that they preferred for you?

Naman Budhdeo (02:13.845)
Yeah, I think, you know, they were very open. I mean, you know, sometimes joke around about Indian parents wanting, you know, an engineer, doctor, lawyer, did go into engineering, but no, they were supportive of whatever I wanted to do, even leading up to, you know, when I started my business, they were my friends and family around.

You know, they were my entire friends and family around. So of course, not all founders, most founders don't have that luxury and have to either put together friends and family around or raise. And, and so I was fortunate that they were very supportive of everything I did entrepreneurial, um, to even be my, you know, initial capital.

Kelly Yefet (02:33.454)
Right.

Kelly Yefet (02:51.358)
Your first four businesses were all within the travel space. So was it part of seeing what your mom had grown and how she developed the companies that inspired your businesses? And how did you see those gaps in the market at a young age and think, okay, this is where I'm going to dig in?

Naman Budhdeo (03:10.253)
Yeah, absolutely. So you know, when I first started there, just as soon as I had my driver's license at 16. You know, at that time, there was paper tickets, you know, it's almost unimaginable right now when you book a ticket, you automatically get an e ticket confirmation, but there was paper tickets. So I was actually delivering a car paper tickets, you know, as a when I was a grade nine.

grade 10. Then I kind of grew up around it as well. And I think one of the things I say to the founders we work with now is I really understood the travel space, but I was working there in high school and then even in university. And so I was dealing with the customers and I was really dealing with travel and the flight space. So really became, you know, we use this term, what I do now in investing, founder market fit. So really understanding a problem

Naman Budhdeo (04:00.743)
the travel technology space, is that I really understood the customer and some of the pain points. And that's kind of what happened. Where the idea for my first company came about was, I had deep understanding of my mother's business and a lot of inefficiencies for her and her competitors. And that led to an idea because this was back in 1999, internet had really kind of just kind of come in to with CompuServe and Prodigy and AOL in 1996,

Lots of opportunities for different businesses. So taking the old school way that my mother's business worked with the new internet technology and building something more efficient in my first company.

Kelly Yefet (04:41.166)
So the first company being was that Flight Network where you started.

Naman Budhdeo (04:44.749)
No, that was a company called Netfares Online. It was a community travel company that aggregated to my mother's company, what was a consolidator. It's a middle man between an airline and a travel agency. Airlines don't wanna work with 4,000 travel agencies, so they work with consolidators. And so it was an aggregator of consolidators and a marketplace for travel agencies to search multiple consolidators. So the term marketplace wasn't even used back then, but that's essentially what it was.

Kelly Yefet (04:47.295)
Okay.

Kelly Yefet (04:56.191)
Yeah.

Kelly Yefet (05:10.602)
Right? And now I think there's a lot of copycat ideas in different industries. So this marketplace idea you can apply to endless amounts of industries. Where did, with it being relatively a new concept at that time, where did you even start? Because you're right, like you're not looking and seeing all these different.

Naman Budhdeo (05:24.014)
Hmm.

Kelly Yefet (05:35.974)
marketplaces and saying, well, I know this industry inside and out and it makes sense here. So how did you Do you remember those like early days?

Naman Budhdeo (05:44.169)
Yeah, I think that, you know, what I did with some of my businesses, I feel like when I talk to founders, businesses break into two different categories. So we, you know, we say one is a proven model. So it's already exists and you make it better. So in the case of in flights, you know, if I talk to, you know, my next company, which was Flight Network, it was, you know, Travel Walk, you know, been around since 1994, right at the beginning of the internet. And so we see this in businesses, you know, all across the world. You can have a proven model, but then you can make it better.

Kelly Yefet (05:53.762)
Yeah.

Kelly Yefet (06:01.803)
Yeah.

Kelly Yefet (06:12.789)
Yep.

Naman Budhdeo (06:13.485)
And you can put a spin on it to be able to provide customers value, you know, either a vitamin or a painkiller is what we talk about when you're, when you're coming up with a business idea, enhancing something or taking away pain. Then you have something which is like a totally novel idea, you know, brand new idea, Airbnb, Uber, you know, something that's never been done before.

Kelly Yefet (06:25.12)
Right.

Naman Budhdeo (06:33.569)
And I think that when I was looking at my early business, it was proven models and then putting a spin on it, especially a Canadian spin, you know, to make it different than the Travelocities or the Expedias or the global giants of the world.

Kelly Yefet (06:43.531)
Right.

Kelly Yefet (06:47.014)
So it's so interesting to hear the story of the starting days. I always find that so fascinating because it's also, you know, your seems that your journey in those early times have been within the travel space, you're in grade nine and 10, you're kind of surrounded by it, but you're also finding opportunities and gaps in a market when like, you're not coming from years and years of corporate experience that you're then applying back. So

That's a really interesting journey to hear as well. I wanna stick more on like your experience before we dig into the businesses, cause I am also curious about actually starting, but how did you find, you're an engineer, you kind of can go on one path, but how did you navigate going the corporate life versus digging into these gaps that you're identifying or areas of opportunity?

Naman Budhdeo (07:23.941)
Sure.

Naman Budhdeo (07:41.941)
Yeah, it's again not a normal path. Even right now as an investor in what I'm doing now, our average founders have 11 years work experience. And I really had 10 months work experience. After university, I worked at Ford Motor Company in their financial management program where they move you around to different sectors every few months, learning different departments.

Kelly Yefet (07:44.206)
I'm sorry.

Kelly Yefet (07:54.359)
Right.

Kelly Yefet (08:07.128)
Mm-hmm.

Naman Budhdeo (08:07.913)
really become a lead in the finance.

you know, training you to be in finance roles for leadership at that program. And so very limited experience, uh, and it's not a normal path. So, um, you know, when we talk about founders today, like how to run meetings or how to do performance reviews or how to hire or how to, you know, motivate employees and, you know, how to put project plans together, you know, all of that was something I learned more. You know, while doing, because I can't learn that with just 10 months of work experience, so just not a natural path to.

your entrepreneurship that you see with, you know, founders building work experience, working in high growth companies, developing their leadership skills, you know, their knowledge.

Kelly Yefet (08:50.294)
Right.

Kelly Yefet (08:53.99)
Whether in the early stage, mid-stage, I know you've grown some very large companies as well and some of the fastest growing in Canada, what were some of the key challenges that even to this day have stood out to you as you built those businesses that you reflect on? And maybe even looping it into being an investor today and an antler and giving some of that feedback because those things really stand out, those challenges really stand out to you to today.

Naman Budhdeo (09:22.113)
Yeah, I think it's really being prepared for high growth. So another part that's more unique to my story is that all of my companies have been bootstrapped. So even though I'm a venture capitalist now, I never took any outside funding. And I think that what we, it's one of the things when I think, I don't have any regrets, but maybe if things I would have done differently would have been, is to take on funding to be able to manage growth really well.

And when you were bootstrapped, what was happening is that we were succeeding and growing so quickly, uh, that we couldn't manage, we couldn't hire enough. And so we actually, I can't believe I say this, but we actually slowed down growth, you know, instead of dealing with the problem, which is like, we can't get enough people or manage the growth, slowing down growth, which I don't think was the right decision at the time. Had I had more resources, I think we could have, uh, and financial resources, we could have dealt with that growth better. Um, and maybe grown even faster in the early days.

Kelly Yefet (09:53.303)
Yeah.

Kelly Yefet (10:17.67)
so interesting because I think a theme that I've heard through, you know, the last 1920 episodes that I've had or even just conversations is almost a hesitation to VCs. And I think you'd probably still say you have to be really considerate and thoughtful about a choice to get VC money if that is, you know, the path forward. But it's interesting to hear that you have had, you know,

Kelly Yefet (10:47.722)
VC is maybe a point that you would do differently. How, as a business starting today, what are some of the things that they should reflect on if VC is right for them or not? If it's interesting to hear you say that.

Naman Budhdeo (11:00.941)
Right. Yeah, I think that, you know, at Antler, what we do is we invest at the earliest stages. You know, we call ourselves Day Zero Investors.

And so, you know, we're not right for everybody. You know, if you've got a team, if you've got traction, certain valuation, you know, we're not the right fit for you. And the reason why we say like, if you're looking at what we do from a VC perspective is, is that if you're a solo founder, you've got the average 11 years of work experience, you've experienced high growth, you may be a second time founder, third time founder, and you're looking for a co-founder, and you wanna build within a community, and you want instant funding, and you want a company

in all global markets to help you grow, that could be an avenue for you. Another one though is that we do believe that it's not always the right choice for founders. You do want to protect the equity that you have. And that's one of the things that we do as well, that you want to protect as much equity as you have. And we want that for our founders. So what we say is, we like to back two or three person co-founding teams that once they go through our round and do a true full seed round, they keep 75% of their equity.

Kelly Yefet (12:08.975)
Mm.

Naman Budhdeo (12:08.981)
So we want founders to keep as much equity as possible. So they're aligned with our vision as well. The more equity they have, the more financially incentivized they are, which works for us as well. So I think it depends where you are. And if you can bootstrap, then that can be, and you have a co-founder and you have a product and you have community, then maybe you can hold off raising and then you could raise at a higher amount when you've proven product market fit.

Kelly Yefet (12:36.655)
I guess part of it as well, as you mentioned, if you're slowing growth because you can't keep up, maybe that's also an identifier that raising to help support that or to solve that problem might be the right fit for you.

Naman Budhdeo (12:44.879)
Yeah.

Naman Budhdeo (12:50.337)
Yeah, it seems silly now, but we were, you know, we, when we started Flight Network, when we were starting in the early days, we were, we were really advertising on, on Google AdWords. And what was happening is that we were doing so well that we were abandoning 80% of calls. So people who would call in with a problem or to change a booking would wait on average 57 minutes on hold. I still remember that. And, and so it was creating a negative, negative experience. So even though our traffic, our marketing traffic was profitable.

Kelly Yefet (13:13.866)
Wow.

Naman Budhdeo (13:19.905)
we started spending less, doing less revenue, but trying to bring our call abandonment rate down to 30%, which is still poor, but better than 80%.

Kelly Yefet (13:29.874)
interesting that was the identifier. Okay, this is going to create poor reputation to the future. So you're ending up spending more on the cost of acquisition and then lose your churn rate of customers is really high. So you have to navigate that versus hiring, a huge call center or something along those lines. So.

Very fascinating. So you touched on the challenges a little bit, but in those early days, and even if it's today, fine. What are some of the moments that you're really proud of through your experience? And I'll hint to you that I also want to lead to the family foundation that you've started as well and hear a little bit about that.

Naman Budhdeo (14:12.549)
Sure, absolutely.

Yeah. So I think that, you know, one of the most important things is probably a bit cliche. It's, it's the team around you. And it took a while to figure that out. You know, I think that, you know, there's the term founder syndrome, especially when you start, you know, started with two employees and then continually added, you know, the early days are doing everything. So I actually, you know, we're abandoning all these calls. So like the Monday to the Friday, I was really kind of driving the marketing and the business and the product and, you know, working with the tech team. But on the weekends, um, you know, I was coming in.

Kelly Yefet (14:31.544)
Right.

Naman Budhdeo (14:44.003)
because we were abandoning those calls and I was taking calls. So I was playing travel agent and I think I booked like 5,000 trips during those first two years. And I was doing it because I was like, I didn't want to abandon those calls and the revenue. But the actual real benefit was that I really understood the customer. And I come back to a product that we did years later called price drop protection, but it was really because I really understood the customer. So I think that...

Kelly Yefet (15:03.211)
Right.

Naman Budhdeo (15:14.421)
You know, being passionate about the customer, involved in what their pain points are, what works for them, what doesn't, that was something that really worked well for me. And the other part was, again, I can't just keep taking calls. You know, I've got to be able to help lead this organization as it grows.

But then not having founder syndrome where I thought I could do everything. So getting to the point where it was like, okay, I can trust somebody to completely handle the marketing or the tech or the call center. And surrounding myself with people that knew more than I did, especially again with my limited work experience. So, you know, even when we got up to, when we got up to about 200 employees and we peaked out, you know, in the end with 700 employees, I brought in a president at that point.

Kelly Yefet (15:46.376)
Right.

Naman Budhdeo (15:59.257)
where I thought that somebody else could help take the strategy and vision, the vision that I had with the team members, convert that to a strategy, a budget, a plan, and deliverables for all the employees. And so knowing when somebody could do something better than I could and letting them kind of run with it, I think that was an important part of why we were successful and we were able to grow.

Kelly Yefet (16:22.434)
It's such an important theme. And I think even in the beginning days as a founder, I'm curious on your point of view on this.

being a solo printer is incredibly tough and the lows, you have no one to pull you out of the lows and you don't really have anyone to celebrate the highs with, but it's also crucial to find, it's almost your life partner. Like if this business is successful, you have to find someone that you can spend 24 seven with. And I would imagine in the early days, that doesn't just apply to the co-founder, but the rest of your team as well. Were there guardrails or, you know,

best practices as you grew a team of 700 people to, I mean, obviously not all the entire team, but those, you know, the tight knit leadership team to make sure you could spend as much time with them as possible and that they would be the best operating team and hit those, you know, the efficiency you want.

Naman Budhdeo (17:23.009)
Yeah, you know, it's very interesting you say that because at Antler, you know, what we're doing now, we don't back solo founders, which is interesting because, you know, my most successful company, I was a solo founder. Um, so I've been a solo founder twice and a co-founder twice, but, you know, we really believe in the co-founder model. I understand why, you know, you need that person who can be your ride or die, who really understands, you know, what you're going through, which is different in an employer, employee relationship. There's always going to be a difference, a power difference as well.

Kelly Yefet (17:40.526)
That's right.

Naman Budhdeo (17:54.024)
And so what I tried to do to accommodate for that is, you know, look for different peer groups.

to help me along that way, you know, kind of things that maybe a co-founder could provide. So I joined a peer group called Young Presidents Organization, which are CEOs under business owners at a certain scale under the age of 45. And you meet with a peer group of like-minded folks where you can talk confidentially about business, your personal, your family life, and so somebody that you can rely on like you would a co-founder. And then also, again, with my limited work experience, you know, I worked for 10 years

coach, you know, talking about improving my skills and how to handle different situations. So I think that helped me with maybe replacing part of what a co-founder provides. And then of course like what I said before is that

you know, having great team members. One of the things I wanted to do is infuse a culture where everyone could talk openly in a boardroom. And I talk about this book that I read, you know, the five dysfunctions of a team. And it's really how you can go into a boardroom and you could really talk it out and you could speak openly and disagree and people wouldn't get offended. And then when you aligned on a decision, you left that room, you know, everybody was aligned, even if they disagree, but that was a decision you were gonna make.

And I try to build that culture to be able to listen to, you know, the, the executive team, especially that I had, you know, that were really talented and try to be, try to be open and again, not fall into, you know, founder knows best.

Kelly Yefet (19:28.59)
I'm curious on your point of view, because I think this is, it's changed a lot over the years, but I'm curious your perspective on a sports team versus a family. And I think a lot of companies these days are moving more and more towards operating like a sports team, not a family. But given what you said that not everyone's gonna agree, but you have to walk away from that meeting with alignment and that everyone's working towards those same priorities versus a family where there's a lot more cuddling and hugging.

How, what do you think of that when you're thinking of building a really strong culture and team?

Naman Budhdeo (19:58.905)
Okay.

Naman Budhdeo (20:05.557)
Yeah, it's great. It's a great question that you say that because my mother's organization was a family run style. Um, her average average, you know, she had about 40 or 50 employees was 18 years. So you can imagine, you know, it was, it was exactly at different time, definitely familiar where I would say on the sports team. So, you know, I did a couple of things that, um,

Kelly Yefet (20:17.614)
Whoa! Different time, but wow.

Naman Budhdeo (20:29.997)
that my mother never would have done and looking at it. And that would be as is that certain people, I've seen that read that unicorns go through three different levels of management at times during their path.

And I definitely found that. So my chief technology officer or my head of operations, got to a certain level of where the company was and they'd taken it as far as it could go. So incredibly difficult discussions with people that had been with me from the very beginning for time to say that, when you give out all these C level titles, that we have to bring in somebody above you to take it to the next level.

Definitely wouldn't do that in a familial culture organization, but had to do that here, which was best for the organization and for the long-term success of the company and for the long-term success of the employment and of the employees and their growth and learning to have a different stage of leadership come in. And so that was a difficult process when starting with a few employees and getting up to a large organization of 700.

Kelly Yefet (21:11.598)
Right.

Kelly Yefet (21:35.414)
Yeah, really fascinating take. I was recently listening to another podcast and thinking back to my time at Shopify and it was very clearly, we are a sports team. And I loved it. It allows you to have a little bit of separation between the company and yourself. So interesting perspective. And I also come from a family of entrepreneurs, which was very, we are a family, which makes firing.

close to impossible, right? Like it just gives a very different culture. So I was curious to hear your take, knowing you came from a family of entrepreneurs as well. Looping back. So the family foundation you have, because to me that, of course you have so many accomplishments, but that seems really like a special place as well. So I'd love to hear a little bit about what it is and what is involved in, what your involvement is in it now.

Naman Budhdeo (22:32.513)
Yeah, so what we were trying to, you know, what I was trying to do is tie in, um, you know, some different, um, bigger themes that are beliefs that I have. And, and I think that, you know, there's so many great causes out there and some, you know, you know, whether it's your time, your money, whatever you're donating or, or contributing to, you can have almost automatic impact or it could be a long-term impact. And so, you know, great causes from, you know, um, uh,

from.

curing medical issues or maybe less, more tolerant society from a racism perspective, whatever it may be. And I feel like they all tie down to education. And I feel that, my father was very fortunate to get a full scholarship in Kenya and to be an engineer. That's the only reason that in the immigration system and a point system that we're able to move to Canada is because he did that. And so I feel like everything can tie down.

to education. If you have a more educated culture that can be more scientists or more engineers or you know more tolerant view on society the more educated you are. There's a million studies there but this is a long game because that kind of investment takes a long time rather than an instant investment in time or money into something that can be done immediately. And so education was always important to myself and my wife for those reasons. Then I wanted to tie in a little

So out of those 700 people...

Naman Budhdeo (24:05.653)
Half of those employees were in India. So I'm born in Kenya, but I'm of Indian descent. And we opened our first office in Ahmedabad, India. So it's in the Gujarat region, very conservative region. And we had some great team members there. And it was our technical office. It grew to a size of about 80 people there. We ended up opening offices in Mumbai and Pune in the future, but wanted to tie in something to that community as well. And that's where we,

Kelly Yefet (24:33.902)
Right.

Naman Budhdeo (24:36.007)
that building a school in that community would also kind of honor kind of three things. It would honor the theme of education being important to being in a location where we had also opened an office and to my Indian heritage, even though I'm born in Kenya, and tying those things together. So we continue to support three schools there.

It's actually my wife who runs it now. And to build junior schools there and continue supporting the school that we had built there outside of Omnibus.

Kelly Yefet (25:10.126)
When I was doing my research on you, which always sounds weird, but obviously to be able to prepare, when I came across it, I thought it was so fascinating because you hear all of, you know, there's always opportunities to do good, but it's also very distracting and there's a lot of other things going on in our lives. So to see what, as you were building these really incredible, fascinating companies to dedicate time, energy, money to.

to investing in the communities that you're building in as well. I thought it was really fascinating and really special. So thank you for sharing a little bit. And I'm sure the success that you've had come out of that has been so meaningful from the hard work in the early days of it. It's very, very cool. So I wanted to touch on Antler for a bit as well and understand, I know you've shared a little bit about some of the practices and types of companies that you invest in, but...

Naman Budhdeo (25:51.831)
Yeah, absolutely.

Kelly Yefet (26:05.698)
First, I wanna start with your role there, how you got involved, because I think it was quite a bit of a change from not being, not raising VC, not being in that space, and now being a general partner there. So curious about why you took that leap and what your role is.

Naman Budhdeo (26:14.55)
Mm-hmm.

Naman Budhdeo (26:21.889)
Yeah, it's a really good question.

Yes, so when I started talking to Antler at the end of December, 2020, I'd never really thought of being a general partner and running a fund. And as I got to talk to Antler, I got to know what they were doing and I really liked what they were doing. So from my perspective, just like I brought in a president when I had 200 employees, my strength is really in the early stage, ideation and product market fit and go to market and unit economics.

And so when I thought about, you know, do I want to go into investing? I never would go and be a series a or hire investor. You know, I don't want to write 200 page investment memos. I don't want to deal with Excel models with like 60 tabs open, um, you know, calculating there. And so what the interesting part about Antler was, is to be able to work with founders at the earliest stage when they're working on ideas, um, when my skills as an operator could help them.

And that's really what I wanted to do. So I spent seven months talking to Antler and seeing if this is what I wanted to do with the next part of my life. I'd been an operator and a founder four times, going from zero to one.

And the reason I came aboard is, it was three reasons. Number one is I wanted to work with great founders and we are investing technology companies and we're agnostic. And I thought that was gonna be incredibly rewarding to work with Canadians. And that was the number one reason. Number two was, again, being an immigrant, you know, I'm very, I've said a couple of speeches of how thankful I am of the opportunities Canada has given me. And, you know, to be able to, you know,

Kelly Yefet (27:34.238)
Okay.

Naman Budhdeo (28:01.659)
build and educated here and build companies and teams here, you know, never would have happened without Canada. And so, you know, 10 or 15 years ago, so many Canadian, there weren't that many Canadian unicorns. A lot of the best talent would move to the United States or a company would get to a certain valuation and sell to the U.S. company. And all of that's really changed the last 10 or 15 years. We've had so many unicorns, we've had so many high growth companies, the talent stays here. And I thought that, I feel very patriotic.

to Canada coming here at the age of four, that if I could do something, because Antler's trying to increase the number of companies, not just the existing companies are out there and we wanna invest them, we wanna get people that may not have ever been a founder before, because they didn't know how to start or find a co-founder.

And so we want to increase the number of companies that are created. And then hopefully that leaves some, you know, a lasting impact. And hopefully, you know, my involvement with Antler could leave a lasting impact to create more Canadian technology companies. And then the third reason was, you know, for successful, our investors are successful, we're successful financially, but I was really driven by, you know, the first two, the first two reasons of why to join.

Kelly Yefet (29:13.828)
I want to get into finding the right deals and finding the right partners, but you mentioned something that I've seen in the news a little bit over the last week or so. So I'm just curious your perspective. As you mentioned in the past, a lot of success and investment with successful or talented individuals will go to the US.

with the new tax laws for capital gains, do you see that being, there's a lot of buzz on it. So do you think that's truly impactful? Do you think that's really gonna make a difference in startups or six people wanting to invest in Canada, or do you think it's buzz and not as impactful as maybe we all feel it will be?

Naman Budhdeo (29:54.721)
Yeah, so I think from the actual VC funds, it's going to be.

Kelly Yefet (29:58.411)
Yeah.

Naman Budhdeo (30:00.229)
And, you know, we, you know, I've never had to raise money before. Again, everything was bootstrapped, but I'm raising money here at Antler, you know, uh, both my, myself and my partner are invested in our fund as well, but we raised most of our capital from outside investors. And one of the big things that, you know, there's two things affecting, um, investment right now. One is interest rates. And so when you can make, you know, 6% risk-free, it makes the return needed

Kelly Yefet (30:06.295)
Right?

Naman Budhdeo (30:30.043)
venture capital even more difficult because of the risk profile. And so one of the things when I talk to investors and I say that you know a lot of the for example real estate has been of course a huge area in Canada both good and bad but a lot of our investors in Antler have also real estate investments.

and they get a rental income or any income that comes in there and they're taxed at 50%. And part of our selling point for increasing venture capital is that it's taxed at capital gains. You know, so let's say the 50%, but really that means you're taxed at 25%. And so by taking on this extra risk to put money into the Canadian ecosystem, your tax lower. So

Naman Budhdeo (31:18.639)
less risk assets like lending money or real estate is less. So it is going to be more of a challenge, a double, both the higher interest rates and capital gains. It makes it for me and my partner harder to raise money. It'll be harder for every single VC fund to raise money. I think it's less impactful from a founder perspective that...

Kelly Yefet (31:31.477)
Right.

Naman Budhdeo (31:46.685)
It's seven to 12 years to be able to make a meaningful, if you're going to be successful, to be able to get to unicorn or IPO status. I think it's less of an issue there, but I think it's a bit more of an issue with the funds deploying capital.

Kelly Yefet (32:02.858)
It's interesting because that's, you know, there's always a trickle down effect. If one layer, one stakeholder is getting impacted, perhaps that means less money to go around or more hesitation, but or more scrutiny on the companies that we're investing. But I appreciate your perspective because you see online a bunch of different points of views on it. So it's always, you know, nice when there's someone that is really dealing with it to hear your perspective. But I did want to hear about your

um, your thoughts on finding the right companies to invest in and, you know, not solopreneur, there's, you know, your, your industry agnostic, but I was reading that you really focus on people first. I know you mentioned that at the beginning as well. So what are some of those pieces that you're looking for when choosing companies to invest in?

Naman Budhdeo (32:55.925)
Yeah, I think it's interesting that you can sometimes get caught up in the founder's idea and it makes sense.

And just to kind of start on the people part is that, when we interview founders, so in our current cohort right now, we have 5,200 people apply and we took 70 founders. And so, really difficult to get in and we're really focused on the person because what we find is that 35% of all existing unicorns have pivoted, have made massive pivots. And we really need to rely on the founders

those pivots. I kind of also give an example of our most successful company right now. You know they work in AI in the for the franchise industry and it's only possible with large language models like open AI. And so when that only happened just over a year ago it's our most valuable company.

but it also harmed one of our original companies in the ed tech field, it pretty much killed that company. And so something, you can never predict something like LLMs or OpenAI to come along, but what you hope for is you have founders who can adjust to this, so it doesn't kill their business, but it grows their business. So we look for founders that are incredibly curious, they love the topic that they wanna solve, they can talk circles around us, if we know more about the topic, that's usually a challenge.

Kelly Yefet (34:05.368)
All right.

Naman Budhdeo (34:21.043)
curious, they're ambitious, they want to build something that could be at a global scale and usually you can see this in some of the things they've done from a work perspective, that they've taken something from zero to one, that they're not going to just sit and do months and months of analysis, that they're going to try to iterate and build something and that they have resilience because there's going to be failures along the way.

I don't know how many stories I've heard that, you know, we were one pay period away from not making payroll. You know, we talked to a founder of Wave, Kirk Simpson.

had over a $500 million exit, but a couple of times, they were one pay period away of not making payroll. And I've heard that story many times as well. So having the resilience is there. So it's not always easy. We think founders, at least for us, break into three different categories. Business founders who are good at product or sales, technical founders, I think software developer, and then subject matter expert. For example, we had an architect come in our last cohort, and she's building architecture technology, expert in architecture.

You fall into those three different categories, but the overall intrinsic is ambition and curiosity.

Kelly Yefet (35:31.798)
That's fascinating because there's so many pivots in a business in the early stage to get it, you know, not necessarily the whole business problem, but adjusting and being okay with that and being able to be so passionate, but also let go at the same time is an interesting balance. Do you find, because you mentioned AI and the LLMs, that there's some industries right now that are just booming and some that are dying out or do you have

more businesses coming in a certain sector than others.

Naman Budhdeo (36:05.653)
Yeah. So obviously, you know, AI is of course, and it's not, we, we also, you know, we make a lot of mistakes here as well. You know, we've gotten caught in a couple of fads. We invested in two NFT companies that are no longer. Uh, but you know, AI is not a fad. And I think everybody would agree with that. Really fortunate here of the tailwinds that we have in Canada and specifically Toronto.

Kelly Yefet (36:09.183)
course.

Kelly Yefet (36:18.475)
Right?

Kelly Yefet (36:22.646)
Yeah.

Naman Budhdeo (36:28.801)
with the amount of AI talent that we have here, it's like world-class. And so we're seeing a lot there. There's a lot of opportunities for disruption here. We're seeing a lot in customer service and using AI to be able to solve questions and problems that normally you'd call a call center or message a company with. I think from an investor perspective is like everything looks like magic right now because of these, you write to the OpenAI API,

or two days to do that and everything looks like magic. It's like, oh my gosh, wow, this is amazing. But what you're really trying to separate is that anybody could write to that API. What is the technology that you're building around that?

you know, to really not just have generic LLM, which is great and learning, but to really provide value for whatever your customers are gonna be and to build upon that technology. And the LLM is just a tool that, you know, has exponentially increased here, but there's still so much more that needs to go into to really benefit the problem that you're trying to solve for companies.

Kelly Yefet (37:34.846)
It's so fascinating. I'm so excited and nervous, but to see the next five, 10, even the next year of AI, because if we think back six months or a year ago and where we were to where we are today, and even the average everyday person using these technologies, it's so fascinating to think about how it's going to start getting embedded into businesses or full businesses built off of AI ideas. Scary, but really exciting. I keep thinking like...

Can my job still exist if there is AI? How do I make myself still valuable? But you kind of have to either be an expert in using AI to make yourself the strongest in your role or figure out what your skill set is to pivot a little bit.

Naman Budhdeo (38:23.646)
And we also see with, you know, just more and more coming out from, you know, whether it's Google or OpenAI or Facebook. And you know, they, you know, OpenAI released, you know, a bunch of developer apps that came on and it instantly, you know, made a bunch of startups obsolete, you know, and so you've got to really think about the value you're creating because the, you know, these large companies are, you know, creating this technology are.

Kelly Yefet (38:41.718)
Yeah.

Naman Budhdeo (38:49.717)
You've got to create value beyond just the LLM, what the LLM provides.

Kelly Yefet (38:53.518)
Absolutely. Okay, I wanna wrap up. So I have a few questions. I think this is a good place to get into my second last question for you, because AI is such a hot topic and there's so much, I think a lot of myths and theories and hypotheses around it. This question doesn't have to be with AI. It just nicely leads into it. But what is a myth that you're told when you started in your...

entrepreneurial journey or that you hear, you know, being in front of so many founders day in and day out that you would want to dispel for future founders.

Naman Budhdeo (39:33.281)
Yeah, it's an interesting one because it's actually, I kind of talked about this earlier about founder market fit, you know, and that is not an absolute requirement. You know, it happens to be my case because I grew up around the dinner table about the travel industry. But I think that

Kelly Yefet (39:38.914)
Right.

Naman Budhdeo (39:50.189)
You know, you can delve into an area where maybe you don't know or you didn't have work experience in. And again, if you show that curiosity and just like devour information, read everything about it, talk to people in the space and that, you know, you can really get up to speed and see opportunities. And when I talk about our most successful company and our three founders in the franchise business, none of them have any experiences in the franchise business. No work experience, no family members who own franchises.

But you know just really became passionate about a topic and could learn about it And so founder market fit I think is a myth that doesn't always have to be there And it's not something that we insist on as well sometimes it helps, but it's not unnecessary

I think the other one is that you don't always have to have a technical founder. And so for example, you can't get into Y Combinator without a technical founder. And we have founders that don't have a technical co-founder and who will execute. And we're passionate about product market fit. And we think that some of the time that tech can be executed, where you can bring people in that, of course, we are tech companies here in the VC space, but product market fit

Naman Budhdeo (41:03.323)
you know, checking the box with a technical founder as well. You can be two business founders or business founder and a subject matter expert and still build a great company.

Kelly Yefet (41:13.454)
Have you noticed that most companies do come to you with a technical founder or is part of the value proposition that Antler is going to support you and find that piece of the puzzle perhaps down the line of a little bit?

Naman Budhdeo (41:26.689)
Yeah, we think the norm is that you have a business founder and a technical founder, but practical founders, you know, are just harder to come by. So even in our antler cohort, we do a really great job of those 50, you know, 5,200 applicants to 70 founders to have a mix. So in our current cohort, we're about probably, um, 50% business founder, 35% technical founder, 15% subject matter experts.

Kelly Yefet (41:34.431)
Yeah.

Naman Budhdeo (41:53.409)
So to give some diversity for the 70 people to find their co-founder.

Kelly Yefet (41:55.228)
Oh.

Really cool. And last question, this is my favorite one, but it's a hard one for you. So as you know, the name of the podcast is How I Became. And I wanna know after talking about your journey and your story, if you were to name this episode, How Naman Became, dot, fill in the blank, what would you name your episode?

Naman Budhdeo (42:18.417)
Um, there, there isn't one template on how you succeed, succeed as a founder. So whether it's fully bootstrapped or, um, you know, or building two companies at the same time as well. There's, there's no rules. I'd say, yeah, maybe I'd say there's no rules on how to be a successful founder.

Kelly Yefet (42:37.246)
Amazing. Naman, thank you so much for joining me today on the How I Became Podcast. Your story is so fascinating. What you have built is just incredible and really excited to see all the unicorns that come out of the companies that you're supporting today. Thank you so much for joining me.

Naman Budhdeo (42:55.013)
amazing Kelly thanks for having me and I hope your guests enjoy.

Kelly Yefet (42:59.198)
Thank you. All right.