Summary

The Offline Network Episode 7: India's Deeptech Ecosystem (aired 2025-09-15). Guests: Anand Chandrashekaran, Naman Pushp from Celesta Capital / Crescendo CX, Airbound. Anand: "InVideo on the list is a great example of an Indian-born AI company that I was really lucky to invest early and saw some of the roller coasters that they went through." Anand: "But I think the two other things I've seen are one, the courage to be ashamed or embarrassed." Topics: venture capital and funding, AI and LLMs, consumer brands and D2C, B2B/SaaS. The Offline Network is India's live show on startups, tech, and venture — streaming M/W/F at 4 PM IST on YouTube.

Full Transcript

Utsav Somani: Hello folks, welcome to a new week of TUN's live streams. I hope your Monday has been awesome. We're having a fairly exciting Monday ourselves, looking at the guest lineup that we have for you today. Today, we're going to hear from Anand, who founded, turned investor, turned founder again. He's going to talk about Celesta, Deep Tech Alliance, and his new venture, Crescendo. Then we've got Naman, who's making drone deliveries cheaper and a reality for Indians, with his new company called Airbound. Before we go into that segment, there's no show of TUN where we can not talk about AI. India AI mission, we're becoming closer to becoming sovereign in our AI stack as well. We've got a whole bunch of exciting updates coming out from the India AI mission. They're trying to build a full stack approach to this whole thing. They've led on new eight startups as well. Compute, models, chips, apps, everything under the sun. And there were four already in this India AI mission as well. Sarvam was the one that we know very popularly, because one of the most well-funded companies as well. What we're trying to do with the AI India mission, from what we've understood, is that they're trying to build India as a place where we're not just a use case nation, but we actually lead in some of these areas as well. And Dhruv will tell you more about what is happening in the world of AI in India.

Dhruv Sharma: Yes. In fact, we've spoken about this in one of our earlier streams as well. With Akrit, yeah. Akrit Vaish, who among many other things, spends time with the India AI mission. And one of the things the government was able to do, so compute comes from GPUs. GPUs are amongst the scarcest commodities in the world right now. They're hard to come by. And even in India, they were scattered in bits and pieces here. And they're not literally in bits and pieces. Say, some companies had them here and some companies had them there. And what the government of India was able to achieve through this mission was just shore up capacity, create GPU clusters for two reasons. One, so that companies that actually had models to train could come and just plug and play. It was 7365. And with these government initiated clusters, we're letting no capacity go to waste. And Sarvam is interesting because it's one of India's most ambitious AI companies, especially as a model company. It's a 24 billion parameter model. Certainly not the largest, but amongst the best that we have.

Utsav Somani: Is this model India? I mean, what's the advantage that any of these models have? That's the question that I think about all the time.

Dhruv Sharma: That's yes. And that's a very interesting question. So I think to answer your specific question, the number I've seen is about 25 percent. So roughly a fourth of the data that Sarvam's models are trained on are, you could say it's in the data. So think about this for a second itself. All of the language and all of the knowledge in the world. In fact, question for you, question for you. Do you think all of the knowledge in the world is digitized?

Utsav Somani: Not really. I mean, we wouldn't have books otherwise, but most of it, yes, I think is. Or at least the large part of data that we've created in this world or the knowledge that we've created in this world is probably digitized. So yes, and we're of course, the mechanisms that we have very recently. So yeah, very recently. And we're of course, 90 percent. That's my guess.

Dhruv Sharma: 90 might be too. So in fact, let's let's ask our listeners what they think. Is it 90 percent? Is it less? Is it more? To my mind, it's much lower than 90 percent. Humanity has created a lot more knowledge than we've managed to digitize. And if you look right here at home in India, I don't think we've digitized everything. And that's part of what companies who are a part of the AI mission have access to. Training data that companies like OpenAI and others will not have access to, which is. So you can't really just throw computer parameters on this problem. You need data. Otherwise, you hit what are called scaling walls.

Utsav Somani: But I mean, we're creating new data, of course, but I think all the previous ones, all of these people have probably exhausted most of the sources. That's my guess. I mean, talking about some numbers, the US has spent close to 500 billion. China is closer to 100. And India is what, 11 billion right now. So we're chronically undercapitalized compared to the global players. What's going to change? Like, do we become just users of this or will we leave at some point?

Dhruv Sharma: Well, I think the goal, the ambition has to be certainly to be more than just users. But you're right. This thing, I mean, it requires a scale of capital we've never really deployed before. Yes. So I think step by step ferociously is what they say.

Utsav Somani: Yeah. And Chalchipiti is with that, going big in India with that 399 plan, perplexity with their Airtel distribution strategy. I think all of us are at least big users. Anyone who I see around us is probably using AI in, at least on a weekly basis, if not more. So I think that's interesting. Coming to real money gaming, that's the theme that we've covered a lot in our previous episodes as well. Hike was the latest casualty of this. And Hike has been around long enough to see many different pivots across life that it's lived for the last 13 years. Kavin Bharti Mittal announced over the weekend in a very emotional post as well, that equation to be founder, be a founder again with the same company, the same mission and the same team is not worth it for him anymore. So interesting to see that people are taking different stances. Winzo and many others have pivoted to micro dramas or focusing on overseas markets as well. Hike was a WhatsApp replacement, if you remember.

Dhruv Sharma: Yeah. Huh. It's a sobering reminder of, you know, the industry we're in or the ecosystem we're in or so, which is over a long enough period of time, you could have the best people. You could, you know, try everything within your capability and many different pivots and still not have the outcome you set out to achieve.

Utsav Somani: Yeah. I mean, look at the other players. Legames 24-7 is cutting 70% of their staff, 500 roles. MPL is letting go of 60% of their team as well. Zuby is 30%. So, I mean, it's going to be insane. Like, I mean, UPS spends are down by 26% just because of the spending or the deposits that were happening on these platforms. So interesting. I mean, it'll be very, very interesting. I mean, the India-Pakistan game yesterday, I think the numbers were pretty low. The stadium was, I mean, half empty. And I mean, of course, that was because of the, I mean, the call for boycott given the recent war situation that we were in. But interesting to see what RNG ban will have an impact on the upcoming IPL next year in March or April. So I think it's going to definitely bring down the numbers a lot in the whole cricketing segment as well. Final news, IPO. So we've covered all the big ones. AI, gaming, now IPO. It's a festive season in the public markets. Grow is looking to refile their papers with updated DHRP, targeting 8 to 9 billion valuation. And hopefully we'll see their list end of this year. They're profitable at scale. They've done 1800 crores in net profit on a 4000 crore top line. So this is just insane. Like, I mean, look at the margins there. And you've seen them play out with Zerodha and other players as well. But Grow is seeming to be an increasingly active participant of the market. And I mean, taking market share away from Zerodha as well, which was the number one for a very long time. What's your take on this thing? Are the numbers going down, trading scenario?

Dhruv Sharma: You know, the first time I actually saw Grow, it used to be, it used to be a mutual fund platform. It went from being a mutual fund platform to a discount broker, to even a fund house. And just as you said, I mean, they've delivered strong, profitable growth. And it's hard to grow at this scale. Even at this scale, they're able to double their revenue year on year. And by some estimates, there's, I don't know, there's 165 crore people in India, roughly. 5 crore people participate in the capital markets and 2 crore out of those 5 crore people are on Grow. Crazy scale. And they also say that 90% of the newly acquired users actually are the age of 13. So very, very young user base as well.

Utsav Somani: Grow has been one of the first participants of the content distribution strategy. And I think Zerodha is doing one, the zero one network, which I think is trying to actively tap into these newer segments of the younger generation as they start investing in their careers. But let's not...

Dhruv Sharma: And Groton, if I may just add a couple of more points, I think, and growth, especially in times like this, I mean, most experts are saying expect no more than 10 or 12% from the index in the coming year. And trading activity is more restrictive than it's ever been before. So to exhibit this kind of growth is pretty impressive.

Utsav Somani: We lived through the biggest bull run of our generation. So I think it'll be interesting to see what the next decade holds for us as investors and participants of this financial market ecosystem. But to tell us more about becoming a founder, an investor who's been awarded recently and for all the things that he's done. Let's welcome Anand onto the show. Anand, welcome. Hey, guys. How are you doing? Thanks for being on the show. I know it's super early, right? Where are you dialing in from? Yes, I'm joining from California. It's super early. Let's do it. No, no, thank you so much. So we'll get into it very quickly. Hurun List just came out over the weekend, I think just before the weekend. They've highlighted some awesome companies, but your name always stands out amongst the top angel investor for the last four years in a row. What's the secret sauce? Congrats.

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah. Yeah, it's been four years now. As you guys know, there's really no list that tracks how angel investors are performing in particular and in general, how investors are doing. So these guys do, I think, a great job of the research. They keep it very authentic. I think for me, the big transition that I've seen over the last, call it 10, 11 years of doing this is I think the first generation was I started when vertical marketplaces were just getting going from horizontal marketplaces like Flipkart and Snapdeal. Then I think we all saw services entrepreneurs say that, look, we can build products. We're building it to spec for our services clients. We can build products for global customers. And we saw the birth of Freshworks with competing against Zendesk at that point with their first product called Freshdesk. And then, of course, there are so many other companies, companies like Moengage and Observe and Accel Data that I invested in super early were on this list. And then the third rev, I would say, was entrepreneurs realized that all the affordances that existed for B2C, like order tracking systems and shipping and fulfillment systems, these are all capabilities that they had learned how to build. And now there were leadership teams that knew how to scale them. And so that went from B2C marketplaces to B2B marketplaces, as we saw. And various sectors of GDP got digitized through that, whether it's food, as an early investor during my GC days at FarmArt, factories like Magma and so on. And I think that sort of gets us to where we are now, which is I think the best founders are sort of saying, you know, unless I invent technologies that didn't exist before versus reusing or reapplying capabilities that existed in one sector to another, I'm not going to build legendary companies. And so we're already seeing early examples of this. InVideo on the list is a great example of an Indian-born AI company that I was really lucky to invest early and saw some of the roller coasters that they went through. Yeah, it's been incredible. I was just reflecting on LinkedIn over the weekend. And I think when you invest, you invest in mostly brilliant founders. Those are easier to ref check and figure out in meetings. But over time, what I've been able to witness is that the best founders end up also being brave and that shows up as grit, that shows up as persistence, shows up as passion, shows up as courage. So that's, I think, been the best part of the story. You know, there's probably a separate segment we can do on those stories of bravery. But I think it's these brilliant plus brave founders that kind of make it through the at least in this list.

Dhruv Sharma: Anand, if I could just pull, you know, the thread on that for a little bit as an investor and also, I mean, courage is a trait that you want not just in founders, but also founding teams. And you've built many teams in your life. And so as you interview people or you speak with founders, are there traces, are there signs of courage that you're able to spot early on?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, I think there's two or three key things that you can spot, right? One is, you know, you try to find out if they've seen excellence early in their life. So this could be, you know, in my case, my mom was a dance teacher and she would correct students and try to make them perfect. And I grew up seeing that. So, you know, once you see excellence, you cannot unsee it, right? And most founders tend to pursue that if they have a taste of like what excellence feels like. But I think the two other things I've seen are one, the courage to be ashamed or embarrassed. You know, most people are so afraid of, you know, like just seen as falling flat on their face that they just don't, you know, fall at all or risk falling at all. And so this attribute where people are just afraid to not afraid to make mistakes because, you know, what you call experience is really mistakes that you made earlier. And so the more mistakes you make, especially earlier in your career. So you look for that attribute. And sometimes if you have two founders who have psychological safety that they've created for each other, then both of them are not afraid to make mistakes in some sense because they've created a psychological safety with each other. And then the last thing I would say is ambition, right? Like I think you're increasingly seeing ambition increase in founders everywhere, but particularly founders in India, because you now see existence proof of those early successful founders and that ambition get rewarded. And so you sort of track for, you know, what some investors call zero billion markets. So even though you might have zero revenue, you might call it like my revenue zero billion. And so you look for like that zero billion revenue ambition.

Utsav Somani: And so you mentioned GC as well as one of the recent companies or the firms that you worked with. And there you spun out Crescendo and had insane growth. I think you raced around as well recently. You're trying to replace call centers with AI basically. Are these AI powered call centers? Yeah, that's right.

Anand Chandrashekaran (Crescendo CX / Celesta Capital): It's been a fantastic journey. You know, I think that I certainly take a lot of inspiration from a lot of the founders that I've been lucky to work with. We talked about the ones on this list. In about late 2023, we launched Crescendo. We came out publicly in early 24. You know, I think the theory there was, you know, I've been inspired by companies like Livongo, which had brought a multidisciplinary approach to a health care company. Right. So before Livongo, every health care company was just two Stanford engineers or two Stanford MBAs. But they sort of created this concept of a multidisciplinary team, which combined, you know, engineers and health care providers and insurance executives, all in a single team. So we really brought that multidisciplinary team, you know, excellence in BPO execution and M&A, excellence in contact center software and excellence in AI into one team. And we built, you know, largely it came from frustration that we had for the last 20, 25 years, you know, prior to GC, my last two jobs were at Facebook building the messenger platform and at Five9. And in both of these jobs, I'd seen a level of frustration where, you know, the various players, the software players, the BPO players, they didn't really have the incentives to support and align with their customers. And so there was this misalignment where the BPO would solve almost every problem with more labor. And the software companies would solve every problem with more enterprise seats. And we felt like, you know, with the last everything that's happened in the last two years, we can sort of combine those and sort of combine people, AI and software. So we built eight different products. We've pre-integrated those into one. And so we go live in a very short amount of time. It's almost like the previous time to market was about a year and a half, two years. And we go live in a matter of weeks. So it's been, you know, pretty phenomenal to be on a founder journey. Some great co-founders.

Utsav Somani: In five years. I mean, I'm sorry, I'm interrupting you there. In five years, how many of the customer support calls will be powered by AI?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): So we now automate over 80% of the calls entirely that we get. So this is an AI triaging a call or a chat or an email, figuring out the root cause issue, you know, resolving the first issue, asking if there's a second issue and then hanging up when the customer hangs up. Right. So, yeah, I think that, but the role of the human agents will evolve in our view. We don't think it's AI alone or it's people alone. I think it's going to be a harmony of those two. And honestly, people will do what people do best, right?

Dhruv Sharma: And this is super interesting. So when does the AI workflow know when to bring a human in?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Um, so one, one thing that we respect is if someone says, I want to talk to a human, we respect that. We sort of know, you know, that they have their own judgment for what issues might require a human. But the ones that issues that we tend to automate are the ones that occur frequently, right? That's what is worth automating. So if there's a question that somebody asks, that is not a frequently asked topic, you're better off directing them to a human and there is really personalized attention because it's not, you know, worth automating because of its rare recurrence.

Utsav Somani: And the journey has been phenomenal, right? On this, you've scaled up to almost triple digit era, million era.

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, we are circling about a hundred million in revenue in the first 18 months. And we raised $50 million from GC and Celesta. I think it's been great. You know, I think that it's also, you know, a lot of folks are watching this kind of transformation because what you're seeing in the S&P 500, for example, is a similar kind of re-rating. So the companies that we call the Mag 7 are really the ones that are the start of the ones that are rerated as AI companies, right? So Tesla is not a car company, it's an AI company. Google's not a consumer products company, it's an AI company. And then for the 490 in the S&P that are not yet re-rated, the market's waiting for evidence that they can function as an AI company. And that transformation looks like, you know, the kind of work that Crescendo is doing, where we're taking an old school asset and able to re-rate it as an AI asset.

Utsav Somani: And, I mean, we spoke about India AI a lot on this show and previous shows as well. I mean, given that you're an investor and a founder as well in the AI space, what's your read on the whole landscape of India? Like, I mean, India is trying with the India AI mission to go more full stack, do compute models and everything, or should we just focus on becoming an app layer where the foundational models are taking care of all the big CapEx heavy players, but focus more on actually getting end users hooked onto new products or new use cases of this?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, I think the two reactions I have are one, you know, India is always good in developing application software products. That's where the investing that's happened and the great management teams that have gotten created, that's where they have expertise. So I think tapping into, like not figuring out product market fit as well as scaling abilities and tapping into existing knowledge is probably a great point to start. But I do think that, especially the large services companies, they probably should go into founder mode versus manager mode. I think that a lot of them probably are optimizing for other challenges that they have as very large public companies. But in order to optimize for the opportunities in particular that AI provides, you know, it's probably critical that some of them, you know, tap into their founders or, you know, get into founder mode because that's what I think it's going to take to make some of the decisions needed to go from here to there.

Utsav Somani: Have you done any investments in India? Sorry, I'm going to double down and ask him publicly, has he done any AI investments in India? I mean, of course, the existing crop of companies are adapting to this new world, but have you been looking or investing in new stuff that's happening in India?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, I think like through my Celesta role have been looking at a lot of different companies. I think the broader construct of deep tech is probably the most interesting one for us. You know, one of the things that, you know, we've been seeing is there isn't a mature group of investors for deep tech in general. There are founders who really, you know, get an intuitive feel for, you know, great deep tech founders like, you know, Aether and others where they've been backed mostly by other angels and founders. And then you've got growth stage companies or, you know, deep tech companies go public early as well, right? So one company that one of my Celesta partners invested in called IdeaForge they went public like way earlier in their career. And so deep tech companies that get profitable tend to go up IPO earlier in their careers, in their lives. But there isn't a group of committed investors that have signaled their interest. So one of my partners, Sriram, launched or quarterbacked an initiative partnering with the government, which is a consortium of deep tech investors. It's called the Indian Deep Tech Alliance, IDTA. And it's brought together eight folks who've sort of signaled their commitment to deep tech. I think all eight have done, you know, pretty meaningful investments, but this is essentially a group that is committing to work with the government and with each other. One of the things that we're seeing in the US, which I think will apply to India as well, is every government is working to make their country more resilient and more decoupled from other geopolitical dependencies, right? And so much like, you know, Wi-Fi and the origin of the internet and so on, where the government funded most of the research in the US, right, through DARPA and so on, I think it's very likely that the government will play a meaningful role in India as well. A lot of us investors and founders are not used to saying, you know, a close partner of mine in this initiative is going to be the federal government. But I think given where we are, the moment we are, I think an initiative like this is likely to bring a lot of energy. So the group has committed about a billion dollars to deep tech over the next few years.

Dhruv Sharma: And Anand, so Crescendo, which we were talking about earlier, was it part of GC's create strategy?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, it's part of what is called the creation fund, which, you know, there are not a lot of founders or not a lot of VCs who operate as founders and help create the company. I think most of the thinking revolves around will this company exist if we don't create it, right? And if it's going to get created anyway, and if it's going to, you know, be a successful company with or without this intervention, then it's almost like a qualifying out criteria. But, you know, if you think about it more and you feel like this company will never get created unless we create it, that's probably the biggest impetus to create these companies. And it has the advantage that if you put that much energy into creating a unique company, it's likely to also be a differentiated company in the marketplace.

Dhruv Sharma: It's a natural follow-up, Anand, is how else are you seeing venture reinvent itself in the US and globally? Because IDD is super interesting. Creation is a strategy we haven't seen from other firms.

Utsav Somani: Permanent capital vehicles, like so much innovation happening in the world of venture. Many of the big stack firms are becoming like almost pseudo P's now, right?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, yeah. I think that, you know, I think investors are also realizing that a lot of the conventional wisdom, conventional advice, you know, is being questioned, right? Like when I remember when I went to study at grad school at Stanford, I was seeking a lot of advice on what made Silicon Valley tick, you know, what made VCs tick. And the belief was, you know, you don't invest in companies that sell to the government. You don't invest in semiconductor companies. You know, there used to be all these conventional wisdom principles. And now like a lot of them are being broken, right? Like the company with the highest forward multiple in the public markets is Palantir, which like still has a big chunk selling to the government. And you've got a lot of advanced manufacturing and space and so on where, you know, the federal and state governments are huge customers. So I think this is actually a fertile ground for a lot of founders, but I think there's probably like a fertile ground for investing to be reinvented as well. I think that it also appeals to, you know, whenever the platform shifts, it also appeals to people who built before and have seen some of these patterns before. So, you know, in the US in particular, I think in Q4 of last year, the percentage of total capital that went to AI was less than 50%, right? It was around 45%, the total investing that went into AI companies. And just three months later, it was like close to 71%. It's probably increasing in that sense. So, you know, I was here, you know, starting the internet platform shift and saw internet, you know, the shift to mobile and shift to cloud. And then it was also lucky to see the one-to-N internet adoption in India, you know, 2013 onwards. And AI, you know, to sort of repeat the obvious, feels like a combination of internet, mobile, cloud, and one-to-N in different countries, right? If you look at a lot of AI products, you know, India continues to be a big market for those companies, for those products as well. So, yeah, if you're a new founder right now, if you're a new investor right now, it's very difficult to ignore this secular trend. In fact, you know, one way to also play it is how does it affect your existing portfolio, right? If you're not thinking about existing companies reinventing, because if you had a certain vision and you started before November, 2022, and you aren't, you know, going back to the drawing board and saying, how can I, you know, sort of implement that vision today with everything that's possible? You're almost like not giving your ambition enough wings given so much that has evolved.

Utsav Somani: Anand, one final question before we let you go, and hopefully you get your morning coffee very soon. Let's zoom out, I mean, or go 10 years down the line. What does the Deep Tech Alliance want to fund and see success from? And also what does success look like at the end of a decade? I know deep tech companies take longer, but if we were just to see into the future, what are you thinking?

Anand Chandrashekaran (Crescendo CX / Celesta Capital): Yeah, I think, you know, think about the structure of this group, right? So one of the things that the group learned from the US CHIPS Act was that, you know, the government directly financing companies is probably not playing to their strengths, right? One good way to do it is for the government to intervene, but partner with people who tend to do it really well, right? And do it really well at scale. And so part of what they're doing is working with early stage series A funds that tend to do investing in a very disciplined way, right? So part of it is if you identify the key areas, like for example, the Indian semiconductor mission is already granting, you know, non-dilutive grants to companies that are in fabless semiconductor sectors, for example, right? So you can sort of do some interventions and do some areas where you want resilience to be developed or decoupling to be done, but then let the free market work its own magic, which is, you know, great investors are looking for great founders. There's a lot of diligence that happens, you know, within that as we know. And so what I like is that this is learning from previously implemented models and sort of leapfrogging some of those while also keeping a very deep alliance between India and the US. That's one thing that I would say, you know, the next 10 years versus the last 10 to 20 years is that there's like true geopolitical realignment. You know, sometimes in the short term, it feels like there is, you know, ups and downs in it, but I think over the next 10 to 20 years, that'll probably be the biggest sort of geopolitical alignment or realignment. And as a result, you know, whether it's export controls, whether it's talent moving back and forth, we're already seeing in key areas, talent, you know, either not leaving India or moving back from the US, you know, back to India. And so you'll see, you know, them sort of move back with some of these models in mind. You know, you're also seeing, you know, about 300 plus GCCs, right? Great global companies having large India centers. And so we'll see in deep tech what we saw in IT services where the best entrepreneurial people said, I don't want to just build products on spec for other people. I'm just going to build and commercialize my own product. So that'll happen in hardware and deep tech as well, right? Like these people know how to build great products and it's only a matter of time before they apply that, you know, product excellence to starting entrepreneurial ventures. And then it certainly helps that India is a very, you know, expensive, i.e. like, you know, valuation-wise rich IPO market at this point. And so, you know, ironically for some of these deep tech companies, the cheapest capital may come from the public markets, right? And the public markets may have competitors like incumbents that are growing at like zero to 5% a year. And compared to that, if you're a profitable, fast growing company that's growing 50 to 100%, as we know, there'll be a lot of dearth of those assets. And so, you know, I think it's actually an exciting moment for deep tech in India. You know, honestly, I feel like this is a moment that has been sort of in the works for a long time. Sometimes you don't, it's happening a little bit underground so you don't see the pieces come together until, you know, it actually starts to happen. But we're already seeing IPOs, right? Whether it's IdeaForge or Aether or others. So these cycles are already started. So I think, you know, we're probably at the start of a 10-year cycle. We talked about AI earlier. I actually think, you know, in India, AI may be applied in some of the other sectors where there'll be very successful companies like, you know, there'll be acceptance of robotics and advanced manufacturing and space. For example, there's already a lot of activity. And that's, those are probably areas where AI will be applied versus sort of jumping on the LLM bandwagon, et cetera, a bit late. So I'm pretty excited.

Utsav Somani: Awesome. Wishing you and the Full Alliance all the best. And thank you so much. And speaking of our next guest, Deep Tech and Product Excellence. I think he embodies that with his new venture, AirBound. Naman, welcome to the show.

Naman Pushp (Airbound): Hey, it's great to be here.

Utsav Somani: You're making drone deliveries cheaper. For our listeners tuning in who've not heard of AirBound, what has been the journey so far for AirBound? What are you doing?

Naman Pushp (Airbound): Yeah, I mean, I think the high-level vision here is that we're making one-room deliveries a reality. I think right now all the drone deliveries essentially just autonomous aerial deliveries, right? And I think the focus of all drone delivery companies so far has been in making that future possible. At AirBound, we kind of came in a bit later where we've recognized that, look, this is happening whether we do it or not. Autonomy is the clear future here. What we want to do is build excellence in what becomes important in an autonomous future. So we care a lot about the hardware that we're building. When systems fly by themselves and are able to do deliveries on their own, it's really the energy cost that matters, right? Mass drives cost. And so we focused a lot on how do you make incredibly lightweight composite structures? How do you make really efficient aerodynamic vehicles? And how does that create the most efficient logistic system in the world?

Utsav Somani: Interesting. And you're already making your drones, right? And for folks who want to see some of the videos that AirBound's put out, you can visit their website as well. We put them in the show notes also after the show has ended. Yeah. Where are you in terms of the manufacturing journey so far?

Naman Pushp (Airbound): Yeah. So I think we've sort of finalized our V0 design. We've had a good manufacturing run. I think that's been the core thing that enables everything else, as I'd say. So we're currently producing drones at a rate of one per day, which puts us at one of the largest, if not the largest sort of drone manufacturers in the country. Looking to be at four per day by the end of this year and hopefully as high as 50 per day next year.

Dhruv Sharma: Naman, for our listeners who are very curious to see the product development life cycle of companies like yours, maybe just walk us through how a product like yours gestates. How do you conceive it? How do you design it? How do you test it? Some early setbacks. At least on the internet, everyone remembers that one very poignant image of Elon sitting with several parts of his crash rocket. And they've come so far. So maybe walk us through that.

Naman Pushp (Airbound): No, absolutely. I think it's funny because we kind of just had a review today of all the crazy crashes and all that we went through to get here. It's been quite an insane journey. And I think it's really hard to kind of break this down into this is how you develop a product. It's kind of like saying, how do you build a company, right? You just have to deal with a lot of setbacks, figure out things as you go. But we've had some wild figures. This has been really a two-year journey to get to the kind of stability that we've reached for the system. It's been a lot of, I mean, the recent months have been a lot of refinement over finer details. But previously, we would have crazy things like just one of the motors would stop running and the entire drone would just be spinning around and somehow we managed to land that. We've had just like your propellers popping off midair. We've had the entire structure just randomly deciding, I want to go down now. And so you have to just, it's a painful road. And I think the only process that is, is you just have to live through all the failures and accept that things break and be a bit rigorous about not letting things break for the same reason multiple times.

Dhruv Sharma: Yeah. Physics is your friend. Gravity is your worst enemy. How many different technical and design themes do you have at Airbound, Naman?

Naman Pushp (Airbound): So I think a few themes that we really care about, we care deeply about composites. I think that's by far the most important thing.

Dhruv Sharma: And is that how the flying vehicles are getting lighter?

Naman Pushp (Airbound): Absolutely. Absolutely. Right. So I think I have some random parts. I get to keep the crappy parts in my room because we don't use them. But I think we've iterated a lot on this. We made some very, very lightweight parts, right? I think we kind of measure weights of things in GSM. So grams per square meter. Our overall laminate structures are sub 300 GSM. So that is lighter than a lot of like chart paper that you get. So imagine a drone made out of that while still being incredibly stiff. I think a good reference.

Dhruv Sharma: So for our listeners, it's light enough to fly quite efficiently, but strong enough to carry heavy payloads.

Naman Pushp (Airbound): Absolutely. Right. You're dealing with a structure that can deal with impacts.

Utsav Somani: How much can it carry? Like suppose you were doing a quick commerce delivery. How much would it cost at scale? And how much would it be able to carry?

Naman Pushp (Airbound): Right. So the current iteration of the drone can carry up to 1kg of payload. We're working on a V2 that can carry 3kg of payload. If you're looking at costing, yes, 1 rupee is the dream. Taking a sample quick commerce delivery today, we're at about 24 rupees for a delivery. By the end of this year, looking to be at around 15 or so. And by the end of next year, looking to be at less than 5 rupees per delivery. And that's for the 3kg payload.

Utsav Somani: And in terms of regulations, drones are very tightly regulated, right? We have got a policy as well. So is that one of your biggest execution challenges that you'll have to overcome before this becomes a reality?

Naman Pushp (Airbound): I think it's a fairly major challenge. The good thing is, there's a lot of tailwinds in our favor. Things have gotten significantly more liberalized since 2021, with the drone rules of 2021. So we can fly freely in green zones. That being said, a lot of cities are still red and yellow zones. We're really working towards, hey, how can you present the right safety argument? For example, a lot of yellow zones are near airports, but they're 8 plus kilometers away from an airport. These drones are flying at 400 feet. Any plane that is that far away from an airport is flying more than 4 kilometers up in the sky. So you're really nowhere close. And it's about, hey, how can we make the right safety arguments with regulators? How can we present the right value proposition to the central government to push this forward? I think there's been a lot of PV loss policy that's been in the books for a while now. I think there's generally a lot of excitement around this sector. I think the major bottleneck has honestly been that there haven't really been companies yet that are pushing the needle on great technology, for whom policy is actually the bottleneck to scaling in India.

Dhruv Sharma: Your current prototypes, are they fully autonomous?

Naman Pushp (Airbound): Yes, absolutely. Fully autonomous, but managed by humans. In case something goes wrong, you need a pilot that can take over.

Dhruv Sharma: Are these short take-off, vertical landing?

Naman Pushp (Airbound): These are the vertical take-off and landing drones. The entire drone takes off like a rocket, the aircraft rotates and then flies like a plane.

Utsav Somani: So you've done hardware and software both. That's the stack that you're solving for. The full hardware, you're manufacturing your own drones and want to be the largest manufacturer of drones in India. Then you're building software for these drones. Do you plan on licensing this software out for autonomy? Or are you using something that's already built out?

Naman Pushp (Airbound): Yeah, so I think it's a mix of layers, right? A good thing is that a lot of these software stacks already exist. There's a large open source community out there. So we're not building from zero. We're building on top of a base that already exists. I think our take here is that the software will become fairly commoditized. Autonomy in the air is a lot easier than autonomy on the ground. You don't have people crossing the road in the air. You don't have random dogs on the street or drivers that don't want to follow the rules of the road. Airspace is fairly cleanly mapped. You know where the aircraft is. You also can divide things up into vertical bands, right? You access an entire new dimension that's not available on the ground. So all of these things, I think, make autonomy fairly easy and accessible. And the transparency required in the system, I think we have to broadcast everything to ATC. It just pushes everything towards autonomy and becoming more and more open source. We see the real moat that we're building as a company within our hardware. Hardware and control layers that make these drones possible and allow us to be delivering much more efficiently than anyone else.

Dhruv Sharma: And all of the applications for your prototypes, have you conceived of only non-military applications at this point, Noman?

Naman Pushp (Airbound): Yes. I think right now, we have a funny reason for why we don't really look at military applications. It's that the market is too small. I think if you can redefine how logistics works, and I think that's something that we can really do. So starting out with these drones for the last five, but then eventually moving to larger aircrafts where suddenly you have 100 kg payload drones that replace trucks, et cetera. I think there's just a lot more to be made with consumer deliveries and moving towards military applications just becomes a loss of focus for us.

Dhruv Sharma: So if you have a point of view that logistics is not a supply chain problem, it's a physics problem.

Naman Pushp (Airbound): Absolutely, right? Because once autonomy is real, then it is only physics that defines the cost, right? Our entire logistics networks have been built on top of minimizing the movement of humans that is required for the movement of goods. If you move towards autonomous systems, humans don't need to move for goods to move. And that is a completely different problem statement that I think nobody in the world has gotten good at solving for.

Dhruv Sharma: And would you say composites and materials are your biggest R&D focus, at least right now?

Naman Pushp (Airbound): Absolutely, right? Because that's what allows us to make aircrafts that are lighter than anything else that's ever flown.

Utsav Somani: And Naval actually just mentioned, I think on Twitter, that only thing that Elon is missing is a drone company, because I think future of warfare looks like it's gonna be dominated by drones and we've seen that. But anyway, just as a closing food for thought, Naman, anybody who's building in deep tech, we've seen the Deep Tech Alliance and we've seen many other initiatives now, specialized funds like Speciale Invest, Vishesh was on the show as well recently. What can you, as a piece of advice, like for founders who are building in deep tech, like how important is storytelling? How important is substance with style? And what are the other key factors that you've noticed have really played a part in attracting capital to ventures like Airbound, like your venture?

Naman Pushp (Airbound): Absolutely, I think storytelling definitely plays a very major role in attracting capital. At the end of the day, these things aren't driven by complete and absolute rationality. It's about creating a future that excites people. That being said though, if you're talking about like as a piece of advice, I think most founders that are able to raise some amount of capital are good at storytelling. I think oftentimes what really builds a sustainable business is that substance, right? A story without, at the end of the day, deep tech is what it is because the tech is really hard to build out. And if your company, if your core team doesn't have that excellence in the technology itself, I don't think it's very easy to scale business up. So at least in our case, it's really been focusing on that substance first and then building the story that comes out of it.

Utsav Somani: Awesome. Thank you so much for dialing in, Naman. I hope to have you back on the show as you cross many more milestones with Airbound. Thank you. Absolutely. All the best, Naman. All right, folks. That's it from our Monday stream of T1. I hope you've enjoyed hearing from Anand and Naman, founder turned investor, investor turned founder, and all bunch of different industries that we've spoken about today, AI, gaming, and also drones. Drones are exciting. So yeah, I hope you've learned something new and we'll see you on Wednesday at four o'clock.