The following interview is a conversation we had with Dennis Thankachan, Co-Founder and CEO of Lightyear, on our podcast Category Visionaries. You can view the full episode here: Over $18 Million Raised to Power the Future of Enterprise Telecom
Dennis Thankachan
Thank you for having me on.
Brett
Not a problem. So let’s start with just a quick summary of who you are and a bit more about your background.
Dennis Thankachan
Absolutely. So once again, my name is Dennis Maggichin and I’m the CEO and Co-Founder of Lightyear. A little bit about me prior to college, I was always a bit of a tinkerer and I started a bunch of very random businesses sort of all over the place in the context of middle school and high school, doing tons of random things. In college, I studied computer science and finance for no real reasons other than the fields of study. Interesting me, I got a little bit involved in the startup community in college. I also started a bunch of student awards and attempted at building a few startups in college unsuccessfully. I also had very pushy immigrant parents who would have been very dissatisfied if I told them I was starting a software company prior to earning a real income.
Dennis Thankachan
So I did the opposite of start a company post college. And I did investment banking at Goldman Sachs, basically advising large enterprise companies on mergers and acquisitions and learned a ton there and met some interesting know, very irrelevant experience to what I do today, but definitely valuable experience nonetheless. And after that I worked at a large hedge fund, investing in public stocks. At the time it was about like a $10 billion or so hedge fund. And I led their investing in telecommunications stocks and also did a lot of investing in enterprise software and Internet companies. And it’s probably not super surprising that what I do today is sort of at the intersection of enterprise software and telecommunications. The experience at the hedge fund was super fun.
Dennis Thankachan
It was a bit of a pressure cooker type environment and taught me a lot about underwriting risk and putting capital to work, for better or for worse. But I like what I do now a lot better.
Brett
What did you learn from your time at Goldman Sachs?
Dennis Thankachan
So I will say what I didn’t learn from Goldman Sachs to start was anything relevant to starting a company. And I’ve had to unlearn quite a bit of what I learned at Goldman Sachs. In the sense, for one, Goldman Sachs is very much an environment where you’re pressured to look and act like every single other person surrounding you. I, in fact, remember that when I was first starting, someone recommended me to wear one of only two different colored shirts and one of only two different color ties. That would be what’s considered acceptable on the workflow, which is very antithetical to, I think, what it takes to start a company or do something unique or different in the world.
Dennis Thankachan
Those are things that I’ve had to sort of unlearn, like the aspects of sort of muting aspects of who you are with regard to work environment. The positives, I will say, which are many, are. I was exposed to a really high caliber of people. The investment banking analyst program at Goldman Sachs at the time that I got that job. I think the world is a little bit different now. Was one of the toughest to get and most sought after jobs that you could get post college in the context of a program. And every single person I worked with was really smart, really ambitious, really hardworking.
Dennis Thankachan
And I was surrounded by a lot of people where I felt like the dumbest person in the room, whether or not that’s actually true, a lot of those people, even though we’ve all gone on to do different things, some of them started companies, some of them have started funds, some of them were my first investors. And some of them have introduced me to either the biggest customers of my company or people that I’ve ended up working with. So it was just a really phenomenal network. The other thing I would say is just the value of really hard work and attention to detail.
Dennis Thankachan
I worked, no exaggeration, for periods of time between, call it, 80 and 110 hours a week, which is not a thing that I would want to subject myself today, and not a thing that I think is very high return in the context of just the value of the work you put out in our 81 or 82. But doing that at age 22, 23, really ingrained what work ethic is in me. And I don’t think I’ve been lazy since then. And attention to detail, especially in the context of large m and a deals, people who’ve been in finance can appreciate this in full. You can’t get stuff wrong. Getting something wrong can lead to a lawsuit, a botched IPO or something or other.
Dennis Thankachan
It can cost lots and lots of money, and you really understand the liability underlying work with regard to making mistakes and the scrutiny put on your work, which has stuck with me in certain ways and been really beneficial. So very different than what I do today. But I have taken a ton away from it, and I’m really grateful to have had the experience.
Brett
When it comes to inspiration, are there any founders that come to mind that have just really inspired you along the way?
Dennis Thankachan
It depends on the vantage point that one takes, I think, what one would consider an inspiring Founder. The people that I skew the most to in terms of reading and learning from are the people that I view as maybe more similar to the archetype of Founder that is myself. I’m less a dreamer type Founder. I guess you’d put like Steve Jobs as the prototypical dreamer type Founder. I’m more of like a rigorous operator type Founder. A bit in the weeds, very execution focused, very get shit done type person. And I’m in the realm of enterprise, SaaS in particular. So a couple of people that I really like and follow that are well known within the space, but maybe lesser known to the broader public, would be David Scott and Jason Lemkin.
Dennis Thankachan
David Scott is a partner at a fund called Matrix Partners, and prior to that, founded, I believe, a couple of software companies and has been successful. Jason Lemkim runs an organization called Saaster. Prior to that, founded a couple of SaaS companies where he’s at exits. Both of them publish a ton of really nitty gritty stuff on all things SaaS, go to market operations, et cetera, that essentially help you build what is a machine that generates money, which is the ultimate goal of building a SaaS product, like a very predictable, highly profitable, go to market mechanism. I think they have the best writing that’s out there on it, and I recommend David’s cock and Lumpkin. And there are a few others in this camp as well. To people that are aiming to start B, two B SaaS companies.
Dennis Thankachan
And admittedly, I was probably a year late into running a company before discovering their stuff, and I wish I knew of their stuff earlier.
Brett
Did you go to Saster this year?
Dennis Thankachan
I did not go to Saster this year, but I need to make it out at some point.
Brett
Yeah, it was a fun one. What about books and the way we like to frame this? We got this from Ryan Holiday. He calls them quickbooks. So a quickbook is a book that rocks you to your core, really influences how you think about the world and how you approach life. Do any quickbooks come to mind?
Dennis Thankachan
Yeah, and I like the term quickbook. I’m going to use that now. My favorite and perhaps most influential book is a book called a Guide to the good life, the ancient art of stoic joy. It was written by a guy named William Irvine, and it’s a book about, it has sort of a short intro to just philosophy, the origination of philosophy in schools of philosophy, and after that goes into stoicism as a philosophy, all the famous stoics, and summarizes some of their writings. Particularly influential for me because it introduced to me the idea of, like, I’d taken philosophy classes in Undergrad and I’d always had an interest in philosophy, but it really hit home the notion of the origination of philosophy with the objective of designing a guide to life effectively.
Dennis Thankachan
Like a set of principles that would underlie why you make the decisions that you make. I spend a lot of time thinking about why I do the things that I do and whether or not I’m spending my time effectively, whether or not I’m allocating my mind share to the right things and why that is, which is sort of a hard question to answer sometimes. It really hit home that point and introduced the idea of stoicism, which I think is like a really powerful philosophy. One I would recommend that I think is particularly useful for founders, because the life of a Founder can be hard and stressful.
Dennis Thankachan
The underlying point that I think is strongest within stoicism, and I’d recommend reading some of the famous stoic works, is a focus on what is in your control only and being a little bit resigned to outcomes or what is out of your control, like just being resigned to externalities in general, which I think is very powerful.
Brett
Yeah, every year I start the year with a list of skills that I want to try to develop. And this year, stoicism was on my list. So I’ve been reading a lot of stoicism books. I’ve been doing the daily Stoic journal. I’m not sure if you’ve seen that, but that’s been super helpful. And it is such an important skill, and it’s been really fun to learn. And I think it for sure helps as a Founder and as an entrepreneur. It definitely helps with manage the day to day stress and anxiety and all the crazy stuff that happens every day.
Dennis Thankachan
Yeah, I think a lot of people I know who start companies for reasons that are maybe unhealthy within the context of trying to seek either external status, trying to seek wealth, trying to seek things that may or may not come from you making the right decisions or doing the things that are best for you. And if that’s the case, I think it’s difficult to attain happiness. And if you succeed to all your wildest dreams and you don’t obtain happiness, what was the point? I guess for certain people, that doesn’t matter if you subscribe to a different point of view, but I think that would be a disappointing way to live life.
Brett
How do you measure your own happiness on a regular basis? Do you just sit there and reflect and be like, all right, how happy am I? And if so, how are you measuring that?
Dennis Thankachan
That’s a tough one. I think there’s a genetic component and sort of a set point component to happiness. Meaning, I think there are certain people that are predisposed to be happier than others, and that’s very difficult to measure and quantify, and it’s more a thing that you feel. For example, of course, there are people born with a genetic predisposition to depression, which is really difficult to correct one way or another. So I think of my own happiness set point, and I know where that is, and I try to think of how I feel relative to that set point. Am I happier than normal? Am I less happier than normal? And why that is and what are the drivers and the things that I’m trying to do?
Dennis Thankachan
I journal and meditate, which are popular things for people that are into stoicism and also a bit fatty with regard to powders. But I do love that stuff, and I find it very beneficial and aim to reflect on whether or not I am living my life in line with the way that I profess one should live life or that I should live my life. And if that’s the case, I find that I’m a lot happier. Hard to measure. It’s not like I’m like, oh, I’m an eight out of ten happy or a six out of ten happy, but at least you can feel the fluctuations and maybe what causes them.
Brett
Are you happier now than you were in, let’s say, 2016 working at Goldman Sachs?
Dennis Thankachan
I am much happier now than I was in 2016 working at Goldman Sachs. The thing that is true in looking back, I’m a very weird person. I’m a bit of a tinkerer. I have very eclectic and od interests that are all over the place. Those are things that don’t have much of a place in an environment like a Goldman Sachs that I found with the people that I was around, and also to advance my own career, that I was muting many aspects of who I am. I think some of the aspects of who I am that make me special or interesting or make me the best version of myself. And that felt okay at the time because it was leading to monetary gain.
Dennis Thankachan
The day I designed my life in a way where I can do a lot less of that, and I’m happier as a result. At least I think I am.
Brett
Amazing. Well, let’s switch gears now and let’s dive a little bit deeper into the company. How we like to start this part is let’s focus on the problem. So what problem are you solving?
Dennis Thankachan
So we’re in the realm of B2B telecommunications, which may feel like a small and niche thing to most people that are outside of it. I’m still trying to convince my parents that it’s a big thing. We’ll see whether or not they get convinced based on this answer. But there is $1 trillion of global b to B telecommunication spend. And when I’m talking about telecommunications, I mean things like business Internet connections, business wide area networking connections. So things like dark fiber data centers, phone systems, things of that nature. This is mission critical infrastructure that’s very big dollar spend for large enterprises. And the problem is, despite this stuff being so important to how enterprises do business, pretty much everything is digital. It catches the Internet in one way or another.
Dennis Thankachan
Today, there is no digital means for an enterprise to buy these services and manage these services, to handle the renewals for these services, to deal with vendors, or to make objective decisions with any data around how their telecommunications infrastructure is managed. And that’s very costly to enterprises in terms of just time and money. From a time perspective, it tends to be the case that large enterprises have hordes and hordes of people dealing with spreadsheets and this, that and the other to manage this stuff, just making phone calls and emails and what they buy. There often is very limited objective data that they’re utilizing to buy their services. It’s a really difficult space to navigate.
Brett
What was it about this problem that made you say, yes, I’m leaving the hedge fund and I’m going to go in and I’m going to solve it? What was it about this problem?
Dennis Thankachan
So the funny thing is it wasn’t even this problem. And this maybe speaks to who I am. I quit my hedge fund job with nothing lined up to start a company because I wanted to start a software business. And I felt like that would make me happier. I spent a ton of time at the hedge fund generating alpha within the telecom space where I had a few theses that I wanted to explore. And it turns out that all those theses were actually really shitty opportunities for business building. And I didn’t end up building anything in those realms. But in the context of exploring another idea, I discovered the b to B telecom opportunity. I started to meet various consultants that helped businesses manage their telecom.
Dennis Thankachan
Like basically consulted them on what they were going to buy, consulted them on maybe network changes and things like that they were going to make. And what I discovered was for one, the amount of spend in the serita on the business side was way bigger than I anticipated. And two, all these consultants were super scummy and they were working with really large enterprises, making tons of money with great underlying unit economics, consulting enterprises, with just a lot of throwing dart at the wall type approach, limited data. And my underlying question was like, wow, these people are making tons of money. I wonder why enterprises aren’t buying this stuff online or using some software product or things like that to do it. After doing some googling, you could quickly determine that there really wasn’t a software product out there to do this.
Dennis Thankachan
And there are some good reasons as to why that is like, this is a very difficult business to build for lots of reasons, but felt like a pretty big opportunity and I’m still doing it, so that at least means something.
Brett
Do all these consultants then just view you as the devil when they read about what you’re doing, see it in the news? Do they view this as something that’s going to displace them?
Dennis Thankachan
I think some of them do view us that way. And the ultimate way that I view it is I think businesses will make efficient decisions, meaning if there’s a cheaper or faster way to do something that makes its way into the market, the businesses will choose what is best for them, because that’s just sort of the way the market works. And I believe this will play out in largely that way. I think there are lots of, I denoted a few scummy consultants. There are also lots of consultants within the space that do an excellent job, treat their clients well, and I’m sure there will be opportunities for them to continue to have fruitful businesses and make money.
Dennis Thankachan
But I think there is also market share to take from people that perhaps don’t do their job well and may on economic basis not have earned the right to the fees that they collect.
Brett
Looking at your website, I see some massive logos that we all know. One that jumps out to me, you have five guys on there. How did you land these types of enterprise deals? I think any Founder listening in, that’s what they dream of, right? They want to have these types of logos on their home page in the way that you do. But how did you pull it off?
Dennis Thankachan
So we have a few different means for go to market, and it’s always been sort of an art form to determine what’s best for your business and what works really well. Early on, we built out a bit of an inbound flywheel that worked pretty well. We identified long tail keywords within Google search that correlate to purchasing intent with a high degree of specificity. So there are specific terms around telecom that are highly technical, but would perhaps indicate that a person’s likely to make a purchase. So, for example, if someone is looking for key one access line pricing, that’s a business connectivity line that’s quite out of date, but also very costly and purchased at the enterprise level.
Dennis Thankachan
Not a ton of traffic on that keyword, but it’s likely that a large percentage of the traffic around that keyword is a person that is a buyer that I would like to talk to at a business. We’ve written content targeted at some of those keywords, and we write really good content that answers questions that buyers are looking for. With transparency around data that’s difficult to access, that’s not easy to do. People click on our content and they find us. And we also, in some cases, will do targeted ads at those keywords. And you can then get inbound funnel, and that’s where we’ve sourced some of our best accounts. A lot of it is inbound.
Dennis Thankachan
On the other end, we do stuff that is very standard fare for enterprise, where we’ll basically just call and email people that are our buyers trying to address a problem and pitch them on it. And sometimes they buy. So like five guys is an example. They were one of our earlier SaaS customers and we have a great partnership with them. I believe that was an outbound cold call. And at that point, that’s a real test of some product market fit and addressing a problem that’s actually pertinent in the market. We make pitches to CIOs and directors of it, and it resonates because this is a pain of theirs and we can save them some money.
Brett
Being on the west coast, I’ll be impressed when you have in and out Burger. That’s the true burger.
Dennis Thankachan
Burger King. We’re fans of all types of burgers here because they all get Internet connections at their restaurants.
Brett
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Dennis Thankachan
So the market category that I fall into, I guess this depends on how you term market category. I would term that on the basis of what companies have financial characteristics and business model characteristics that are similar to yours and what is your revenue generating event. So for us, the category we broadly fall into is SaaS, and we are enterprise SaaS. We sell primarily into the enterprise. And when you look into enterprise SaaS, you have a bunch of companies that have financial characteristics that are similar to ours from like a revenue generation, business model, et cetera perspective. If you look at telecom as a category, although we deal with a line item of telecom, you find a bunch of companies that have no overlap this, they actually build infrastructure and they have a very different go to market within b, two B, SaaS.
Dennis Thankachan
There is a bit of a renaissance going on within procurement. There are lots of different categories that are having verticalized procurement solutions built out to orient around specific line items that are pain points for businesses. So one category that’s seen a lot of transformation is SaaS procurement. There are lots of really great companies raising venture money that are helping businesses make better decisions around SaaS product purchasing, getting the right price, and then also managing their SaaS contracts, making sure they’re utilizing what they’re paying for, rationalizing that, all of that. There’s tons of companies that have raised venture money, and they all have really exciting and interesting products. There’s a transformation going on insurance, there’s transformation going on in other line items. We’re sort of that for telecom. So I put us within sort of that procurement software category oriented toward the enterprise.
Brett
I’ve interviewed a few founders who are building SaaS procurement platforms, and one of them in particular that stood out to me said he hates the word procurement. He never wants to use the word procurement. Do you have strong feelings towards the word procurement?
Dennis Thankachan
I do not. I’d be curious to understand why they hate the word procurement, because at the end of the day, it’s a word that’s utilized and we deal with folks who would turn themselves from a title perspective, procurement. So I don’t want to anger those folks. They work well with us and people do procure things via Lightyear. So it’s a word with a definition that applies pretty well.
Brett
Now talk to us about finding product market fit. Do you think you have product market fit today?
Dennis Thankachan
I believe we have early product market fit.
Brett
What was the journey like there? What were some of those big milestones along the way?
Dennis Thankachan
So the early days for us were brought with determining go to market, an ideal segment of the market to go after. The thing that was beneficial that we had going is Calicom is a huge cam. It’s a really big line item for enterprises, and there are existing solutions in play that we’re very differentiated from, that solve a problem for the enterprise that make money. So that’s on its face, validation of cam and validation of business model, which lots of startups don’t necessarily have. Like five years ago, SaaS procurement as a category for software was not a thing at all, and that had to be validated. Even though now today seems like a pretty large taM, seems like a good idea. We didn’t have that issue necessary on the other side, because the TAm is so big and there’s so many enterprises that buy.
Dennis Thankachan
Telecom focus was a big point. Do we want to go after SMB? Do we want to have more of a product led growth style motion? Do we want to go after enterprise? Things of that nature sparked a lot of debate, and initially went after SMB, and I actually think that was a bad decision in retrospect, and we’ve since corrected for it, and then finding the ideal product to solve the problem. So telecom is a very difficult market to attack with software, because you’re dealing with a lot of information that is not digitized. There’s no digital repository of how these services are priced, what services are where, who has fiber in a specific location. None of this stuff is digitized. So you have to digitize the information from scratch and all the workflows you have to digitize from scratch.
Dennis Thankachan
So building a product is hard, and you have to start with the right subset of features that is sellable to the segment of the market you want to go after. Early on, we started going after SMBs with a product that was sort of half built out, and we grew, but we grew pretty slowly as a result of that. It was through some of our earlier enterprise engagements that we started to really discover that there were a specific set of features that would basically cement what is the minimum viable product for the enterprise within our category, and that’s what we should build toward. And two, I was able to determine that the enterprise is where we want to go after. Sounds simple in retrospect, but enterprises spend way more money on telecom and they also have way more people allocated to the problem.
Dennis Thankachan
So as a result, a product can drive more surface area of value within an enterprise, within an SMB, where within an SMB maybe you buy one or two telecom services is just not a big deal for you. And once we had that direction, we started to build toward it. And I really felt the product market fit. When were really getting price points that were indicative of a real enterprise value, and the customers were renewing and coming back and expanding without much push from us. And early on when were selling to SMBs and we had a very not fully featured product, I felt like we really had to push customers to buy and you had to move mountains to get revenue in the books at a point in time that really began to change.
Brett
Can you tell us anything about the numbers and the growth and adoption that you’re seeing today?
Dennis Thankachan
Sure. So we don’t publicly disclose revenue numbers, but today we have 275 customers, or actually a little bit more than that, last I checked. And we are managing deep into the tens of millions of dollars of telecom spend across thousands of enterprise users today. And we are growing at venture scale. So growing pretty quickly. We’re probably like something like 30 times larger than were two and a half years ago. Two, two and a half years ago, something like that.
Brett
What’s keeping you up at night on the growth side today, I believe we’re.
Dennis Thankachan
Transitioning from a period of art to science in the context of like an enterprise oriented go to market. I think early on there is this art period of really determining what the buyer wants, how to price, how to message it, who I should go after, maybe augmenting the product, maybe how you position the product, maybe the UI. And there’s a lot of feelings involved and a lot of qualitative determinations of what to go after before you really isolate on something that works and put business model and unit and economics, et cetera, all around that. I believe that portion is largely sorted for us.
Dennis Thankachan
Certainly far from perfect, but I think we have the real inklings of a machine, and we’re now putting real constraints around that machine to sort of generate more and more revenue with a team oriented to work growth, which is great because the first part really hard to figure out. The science mentioned, you know, Jason Lemkin and Scott, like there’s lots of stuff out there, how to build a good account executive program, how to measure the efficacy of marketing, things like that. But the unique thing that is a little bit difficult in this current environment is the market, which is completely out of my control. And today the cost of money is very high. So the cost of failure with regard to experimental decisions around sales and marketing is also quite high.
Dennis Thankachan
And that adds a level of stress that may not have existed a few years ago with regard to raising money and the amount of scrutiny on how you spend money. So as we make this transition, there’s a big amount of pressure to push for efficiency of your go to market, and I think we’re doing quite well in that arena, but it doesn’t mean, it doesn’t cause me to lose sleep at night at times.
Brett
Do you have any examples of sales and marketing initiatives that you thought were just going to be a big hit and they ended up being a bit of a flop?
Dennis Thankachan
Yeah. So as an example, I denoted an orientation toward inbound versus outbound. And with regard to inbound go to market, at the time that I was thinking about building an SMB centric company with more of a PLG motion, inbound tends to be what works better for that style of company, with some exceptions, and lots of variance, of course. And I had lots of ideas around ways to generate inbound and even some virality or network effect within product that lend itself to something that looks like a more consumery style thing, which has worked well for lots of SMB type products, of which there are tons of successes given. It turns out we want to go after bigger acds with bigger companies. We’ve had to re augment our go to market.
Dennis Thankachan
We still have a wonderful inbound funnel, but there are caps on how far that’ll scale. And we’ve had to build out something that looks more like the way that a company like a servicenow would go to market, where you have to outbound for leads, you have to have reps making calls, sending emails, things of that nature, and engaging with buyers. You need to go to conferences and things like that. And that’s just a totally different go to market DNA. And the inbound stuff is great. And on occasion we get phenomenal leads that come inbound. And I’m super grateful for that because also, like a lot of stuff coming inbound, some good word of mouth and things of that nature, those are some signs of product market fit, but that won’t scale you to IPO level for sure.
Brett
Is it still Founder led sales are you still involved in every sales conversation, or as it gets closer to being a dealer, are you still involved in everything, or have you stepped away and you have a team managing that now?
Dennis Thankachan
So we’re transitioning quite away from that. So today we do have a sales team and I am involved with our largest customers, largest sales and also sales where maybe there’s some belief that I can add value. I also try to source customers for us here and there. I’ll be involved with people that I personally know in some way. But it is largely the success of the team that drives outcome for us rather than me today. And the further I can step away, I think the more of a sign that is that we have product market fit and that this is a machine rather than someone willing things along.
Brett
What did you learn from making that transition? And the reason I ask is a lot of the founders that I speak to really struggle with transitioning away from Founder led sales.
Dennis Thankachan
I think I have always oriented to transition away from that because I think the difficulty in transitioning away from Founder led sales is productizing and putting constraints around your sales motion, which is very hard. You need to build a system that’s unit economic, profitable from a quota perspective. You need to think about if you’re going to have a rep, how are you going to keep that rep fed with leads. Generate pipeline measure efficacy of pipeline measure pipeline conversion put systems around that and also ideally have something that works not just for one rep, but 510 1525 reps in a way that generates more money than you spend on the team. And then you have a machine that scales and that’s awesome. The nuts and bolts of that I find is really difficult for people.
Dennis Thankachan
And there are certain people that skew to be really natural salespeople. Sort of put them in a room and they’ll just will people in the direction that they want. And those people. Sometimes this is absolutely a generalization, but I think it’s largely been true in my experience. Sometimes those types of natural born salespeople are not the best with numbers systems and process. I actually skew far more toward numbers systems and process, and I would not consider myself a natural born salesperson. So the latter part is actually much easier for me.
Brett
I prefer it when it comes to fundraising. As I mentioned there in the intro, you’ve raised over $18 million to date. What have you learned about fundraising so far?
Dennis Thankachan
Fundraising is also an art to science type transition and has a lot of similarities with enterprise sales. Like at the end of the day, you’re convincing people to give you their money and that you’ll generate them an ROI, which at the end of the day is what you’re trying to do in a SaaS sale. There was a period of art which is early on, which is sort of pre product market fit, even pre product in some cases, where you’re convincing investors about an idea, a team, the efficacy of that idea and the opportunity to sort of execute and take over a market that can be big. And it feels a little bit like what people romanticize around being a Founder, like being on shark Tank or the social network or insert Founder meme here. That period was not great for me.
Dennis Thankachan
I got a ton of rejection because as noted, I’m quite a nuts and bolts person. I’m in the weeds and I’m quite practical with what I determine. So building out the telecom operating system and our opportunity to take over enterprise telecom with like a really thought through SaaS product is just not sexy at all. And for a lot of people, sounds and feels small, which I think is ridiculous because there’s trillions of dollars of market cap within telecom, but feels small for a lot of people, hence the rejections. And I probably wasn’t the best at pitching it. There’s a ton I learned on how to get past that and I ultimately did. And were successful in raising precede and seed funding. That got us a long way from some really awesome investors.
Dennis Thankachan
And I think in the current market and also at my current stage, it’s just so much easier for me because I’m a pretty ruthless SaaS investor type. I used to generate alpha buying SaaS in the public markets and I know how to underwrite SaaS companies. I think I can do a better job of that than perhaps a lot of the people who would underwrite me. And today we have numbers, we have performance metrics, we have a lot of proof points around the tank, we have customers and we have a product. And I think for one, those things speak for themselves. And I feel like I’m assessed on objective criterion and it doesn’t mean that everyone loves the business. The business is for certain types of investors and not for others.
Dennis Thankachan
I definitely gained confidence in pitching, partially as a consequence of having real performance metrics to fall back on. And also the types of investors I talk to now are much more rational. At the seed and precede stage, you get a lot more dreamer types who are looking for weird out there, sexy and cool sounding things, sometimes hype chasers. At the growth stage, you get more and more investors that are sort of like dollars and cents efficiency metrics with some dreamer mentality in there.
Brett
Let’s imagine that you were starting the company again today from scratch. What would be the number one piece of advice that you’d give to yourself?
Dennis Thankachan
Constraints breed benefits. The thing I learned from the period of 2021 in particular, where a lot of capital was available, was that I saw lots of people around me raise lots and lots of money. And we also took advantage of that market and raised some capital as well, at great terms. However, the more money you have in the bank ahead of the traction of the business, the less your back is against the wall and the less pressure there is to create a diamond per se. At the very earliest days, at every point I had my back against the wall. Every dollar was not necessarily there in the future.
Dennis Thankachan
And that bred a level of efficiency internally and a level of rigor around every decision that was made during the period of 2021 that got relaxed quite a bit and there was a lot less scrutiny on the quality of decision making. And actually for us, reintroducing constraints with capital, despite we have a very strong balance sheet with a lot of money on it, and we’re not burning much money at all. So we’re in a good position. However, reintroducing constraints even with the money on the balance sheet and being rigorous in that sense, we’re now growing faster at bigger numbers with the constraints in place, because we’re operating as if that next dollar is not necessarily guaranteed. And I think that actually helps build businesses.
Dennis Thankachan
It’s not a coincidence that a lot of the greatest businesses ever have actually not raised much capital, and a lot of businesses that have raised too much capital have flamed out in one way or another. Of course, there are exceptions to both ends of those rules, but there’s something to be said about that.
Brett
We are up on time. But I do want to ask you one final question. Final question is about vision. What’s the big picture vision here? What’s the next three to five years going to look like today?
Dennis Thankachan
In the context of business telecommunications, there is no brand or product that elicits a positive reaction from a buyer with any sort of brand recognition. And I think that is up for the grabs to capture with a lot of excitement from buyers around that potential. Given this is just such a pain point for buyers that hasn’t been touched for something like 2025 years. And with regard to Lightyear in particular and what that means, I think it’s a lot of doubling down on product and capturing more surface area of all the workflows within telecom in particular, without digging too deep into the nuance and not losing focus. The market is so large, there can feel pressure to like, oh, focus on something outside of telecom, do this, that and the other. I’m very much focused on depth over breadth.
Brett
Amazing. Love the vision. I love everything that you’re doing. We’re going to have to wrap here before we do. If there’s any founders that are listening in and just want to follow along from a company building perspective, where should they go?
Dennis Thankachan
Check out Lightyear AI, that’s our website. Or look us up on LinkedIn. Company name Lightyear. Again, Lightyear AI is the domain we publish lots of content on there.
Brett
Are you sharing lessons about the journey as well? Is there know personally if they want to follow along with you where they can go?
Dennis Thankachan
I don’t have a personal Twitter or anything of the sort. I’m not the best at social media. That’s partially on purpose.
Brett
Makes a lot of sense. Sure. It makes focus a lot easier. Dennis, this has been a lot of fun. I’ve really enjoyed it. I know the audience is going to enjoy it as well, so I really appreciate it.
Dennis Thankachan
Awesome. Thank you so much, Brett.
Brett
All right, keep in touch. This episode of Category Visionaries is brought to you byFront Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B Founder looking for help launching and growing your own podcast, visit frontlines.io podcast. And for the latest episode, search for Category Visionaries on your podcast platform of choice race. Thanks for listening, and we’ll catch you on the next episode.
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