20VC Why You Must Have A Customer Acquisition Strategy From Day 1, How To Test and Validate Ideas At Speed & Why You Should Speak To Investors Before Starting Work On Your Idea with Kulveer Taggar, Founder @ CEO @ Zeus Living

In the latest episode of "20 minutes VC," host Harry Stebbings interviews Kulvir Tagar, founder and CEO of Zeus Living, a startup revolutionizing business travel through smartly furnished homes for extended stays. Tagar, who previously co-founded Automatic and Bosco, has raised significant VC funding, including from Y Combinator, GV, and notable angel investors like Naval Ravikant. The conversation dives into the challenges and intricacies of scaling a tech-enabled business, the importance of culture as a scaling superpower, and the journey to finding product-market fit. Tagar shares insights from his entrepreneurial experiences, emphasizing long-term thinking and the transformative advice from NFX partner James Currier. The episode also touches on the support from Initialized Capital's Gary Tan and Alexis Ohanian, and the unique operational demands of a tech-enabled company dealing with physical assets.

• Zeus Living is a startup providing furnished homes for business travel and extended stays.
• Kulveer "Cool" Taggar is the founder and CEO of Zeus Living.
• Taggar has a history of successful ventures, including Automatic and Bosco.
• He has also made several angel investments in various companies.

"Now Cool is the founder and CEO Zeus Living, the startup providing a home of your own for business travel with smartly furnished homes for extended stays."

This quote introduces Kulveer Taggar's current venture, Zeus Living, which focuses on offering furnished homes for those who need accommodations for extended periods, typically for business travel.

• Kulveer Taggar has raised over $14 million in venture capital funding.
• Investors include Gary Tan, Alexis Ohanian, Initialized Capital, NFX, Floodgate, Y Combinator, GV, and Naval Ravikant.
• Taggar co-founded Automatic, which sold for $5 million, and Bosco, which raised seed funding from YC before moving to the States.
• His entrepreneurial journey was influenced by his exposure to Silicon Valley and tech startups during university.

"Million in vc funding from some very dear friends of the show in the form of Gary and Alexis that initialized James and Peter, NFX, Mike at Floodgate, Y, Combinator, GV, and Naval Ravicant, just to name a few."

This quote lists the notable investors who have contributed to the venture capital funding of Kulveer Taggar's startup, Zeus Living, highlighting the strong support from prominent figures in the tech and VC community.

• The idea for Zeus Living was sparked by the frustration Taggar's co-founder, Joe, experienced while trying to rent out his home.
• Taggar envisioned a quantum leap improvement in the home rental process, inspired by companies like Opendoor and Stripe.
• The concept involved offering homeowners a seamless way to rent out their properties through a simple online interface.

"What if you could go to a website, type in the address for your home, it gives you a price, and you just click rent, and then that's it."

This quote captures the innovative idea behind Zeus Living, where the process of renting out a home is simplified to just a few clicks online, revolutionizing the traditional, cumbersome rental process.

• Taggar learned the importance of thinking on a longer time horizon from his experience with Automatic.
• He realized that a long-term perspective can provide a competitive advantage in decision-making.
• The experience also taught him about the significance of being intentional with company culture to create a productive and collaborative environment.

"So that was one of the lessons I had coming into Zeus was like, let's actually think really long term here."

This quote reflects Taggar's shift in mindset towards long-term planning and strategy, influenced by successful entrepreneurs like Mark Zuckerberg and Jeff Bezos, which he has applied to his approach with Zeus Living.## Tech-Enabled Businesses vs. Pure Play Software Businesses

• Tech-enabled businesses involve working with physical elements, making scaling more complex than pure software.
• Zeus, as a tech-enabled company, must excel in various areas to provide a good living experience.
• The breadth of inputs to produce the desired output is significantly larger in tech-enabled businesses.
• Software companies can often focus more narrowly, which is less complex than managing real-world logistics.

"It's harder to scale than a pure software play because we are acquiring and creating physical things."

This quote explains the inherent complexity in scaling a tech-enabled business like Zeus due to the need to handle physical assets.

"Somebody else who I think put this well, is David Hahn from Instacart."

Kulveer Taggar references David Hahn to emphasize the vast array of inputs required in tech-enabled services, illustrating the complexity compared to pure software businesses.

• VCs often rely on pattern matching, making unique businesses like Zeus more challenging to evaluate.
• Zeus encountered different investor perspectives based on geographical location.
• Communicating the technological aspect of tech-enabled businesses is crucial in fundraising.
• Convincing investors of the tech-enabled model's value requires clear messaging about the technology's role.

"There's actually not a huge amount of similar businesses that they may have looked at before."

Kulveer Taggar discusses the challenges in fundraising due to the lack of comparable businesses in the VC's experience.

"Out here on the west coast it was [different], and so I think often, sometimes with these tech enabled plays, investors even ask where's the tech, what is the tech, what's the advantage?"

This quote highlights the need to adapt fundraising strategies to different investor expectations and the importance of articulating the technological component of tech-enabled businesses.

• Initialized Capital played a foundational role in Zeus's development.
• Gary Tan, a partner at Initialized, is known for his quick conviction and supportive nature.
• The ability to make swift decisions and provide support during critical times is seen as a valuable trait in investors.

"Gary, I've known him for a long time, but what I like most about him as an investor is he has conviction quickly."

Kulveer Taggar praises Gary Tan for his ability to quickly recognize and invest in potentially world-changing ideas.

"Initialized has come through for us at times that have been really critical."

Taggar acknowledges the critical support that Initialized Capital provided at pivotal moments for Zeus.

• Tech-enabled businesses require meticulous planning and a high level of operational skills.
• Effective communication and collaboration are crucial due to the need to manage physical processes and teams.
• The ability to adapt and maintain quality is more critical in tech-enabled businesses than in pure software companies.

"You can be really good at software engineering and designing product, but you actually have to be a really good operator."

Kulveer Taggar stresses the importance of operational excellence in tech-enabled businesses, beyond just software development skills.

"I think your ability to collaborate and to have excellent communication skills is more leveraged."

This quote highlights the increased reliance on collaboration and communication in tech-enabled businesses due to their complex nature.

• Y Combinator's experiment with funding teams without ideas led to the pivot to Zeus.
• Previous ventures and ideas did not achieve the desired impact, prompting a strategic shift.
• Advice from NFX's James Currier influenced the pivot, suggesting a focus on high-value and high-frequency markets.
• The concept of product-market fit was clarified, emphasizing that it should be unmistakable and achievable relatively quickly.

"Paul accepted us, gave us a check. And then in 2011, we started the Y Combinator without a solid idea."

Kulveer Taggar recounts the unconventional start at Y Combinator, which eventually led to the founding of Zeus.

"He said, instead, what if we did this? Let's create a list of the top 20 things that people spend their money on by dollar amount... You should create a business that doesn't go below number seven in either one of these lists."

This quote describes the strategic advice from James Currier that helped pivot towards creating Zeus, focusing on high-value and high-frequency opportunities.## Seeding the Idea for Zeus

• Harry Stebbings discussed how prior experiences and conversations seeded the idea for Zeus.
• The approach involved testing language and positioning to gauge receptivity to ideas.
• This process differed from past practices and led to the realization that a promising idea can generate significant investor interest.

"So I think there was a few things that sort of seeded my mind before we came up with Zeus, but that conversation was one of them."

The quote highlights how previous discussions and experiences contributed to the conceptualization of Zeus.

"But then I realized when you actually have an idea that has promise, it's not necessarily like that."

This quote underscores the difference in investor engagement when an idea shows promise, contrasting with past entrepreneurial challenges.

• Harry Stebbings and Kulveer Taggar discussed the balance between science, intuition, and data in testing ideas.
• They emphasized the importance of both quantitative (conversion rates) and qualitative (user feedback) research.
• A challenge presented by an NFX partner tested the market viability and scalability of the Zeus idea.

"We probably did about six weeks worth of data experiments where we were testing conversions, and then we did a few weeks of qualitative research where I was talking to users..."

This quote explains the methodical approach taken to test the Zeus idea, combining data analysis with direct user engagement.

"I want you to sign up ten homes go."

The challenge set by an NFX partner served as a practical test of the Zeus concept, focusing on market demand and operational scalability.

• Kulveer Taggar addressed the difficulties of maintaining morale during testing and pivots.
• The role of a coach and the departure of a co-founder were part of the journey.
• Taggar's change in belief from execution to the importance of the idea itself is highlighted.

"I started seeing a coach who really helped know one of our original co-founders ended up actually leaving..."

This quote reveals the personal and team challenges faced during the development of Zeus and the support systems used to maintain morale.

"And I've actually started to believe now that if you're doing a startup, almost the only thing that matters is the idea."

Taggar's shift in perspective from execution to the centrality of the idea in a startup's success is underscored in this quote.

• Kulveer Taggar countered the notion that ideas are worthless, arguing for a broader definition of a startup idea.
• He emphasized the integration of customer acquisition channels, market positioning, and language as part of the idea.
• Taggar also discussed the importance of achieving product-market fit and its impact on work ethic and success.

"And so one thing I learned from NFX was the channels that you would use to acquire customers is almost like a fundamental part of the idea you've had."

Taggar expands on the concept of a startup idea to include strategies for customer acquisition, which are vital to the idea's success.

"Pre product market fit, post product market fit. If you're pre product market fit, all you should be doing is trying to get product market fit."

This quote delineates the two states of a startup, emphasizing the crucial goal of achieving product-market fit before anything else.

• Kulveer Taggar discussed how culture can be leveraged as a key factor in scaling a company.
• He described creating an environment that fosters communication, feedback, and collaboration.
• Taggar shared personal experiences where vulnerability strengthened leadership and team bonds.
• The company established traditions and exercises to deepen coworker relationships, enhancing team productivity and resilience.

"I remember reading, I think, Reed Hastings from Netflix who said that culture eats strategy for lunch."

Taggar cites Reed Hastings to highlight the superior impact of culture over strategy in a company's success.

"We do this one exercise called, if you really knew me, where you then sort of just talk for two minutes."

This quote describes a specific tradition aimed at fostering deeper connections among team members, thereby strengthening the company's culture.## Bringing Your Whole Self to Work

• Harry Stebbings discusses the importance of not differentiating between personal and professional selves at work.
• The approach has led to low attrition rates, high ownership in the company's mission, and a strong referral culture.
• Company culture is co-owned by everyone and is constantly iterated upon.

"And then I kind of realized, well, actually, we spend a lot of time and a large proportion of our lives at work. What if you didn't have to make that sort of differentiation and you just brought your whole self to work?"

This quote highlights the realization that integrating personal and professional lives can enhance workplace satisfaction and effectiveness.

• Kulveer Taggar discusses his favorite books, "Midnight's Children" by Salman Rushdie for its prose and historical fiction, and "How the Mind Works" by Stephen Pinker for its technical and enlightening content on the brain.

"But for me, midnight's children by Salman Rushdie, I think it's some of the best prose ever written."

Kulveer Taggar explains why he values "Midnight's Children" as a literary work, emphasizing the quality of the prose.

• Kulveer Taggar would like to see a change in Silicon Valley's bragging culture, finding it counterproductive.
• He values genuine, open relationships with a circle of friends and CEOs.

"I think I would like to change the bragging culture."

This quote expresses Kulveer Taggar's desire to shift away from the superficial aspects of Silicon Valley's culture towards more authenticity.

• Zeus, the company Kulveer Taggar works for, uses software to break through bottlenecks in property management.
• This approach exemplifies a tech-enabled startup, providing leverage to previously manual processes.

"Our entire company at Zeus is basically this, using software to streamline a non digital activity."

Kulveer Taggar describes the core strategy of his company, emphasizing the use of software to improve efficiency in traditional activities.

• Kulveer Taggar frequently revisits the quote by Henry Ford about building a reputation based on actions rather than intentions.
• This philosophy ties back to his views on the bragging culture in Silicon Valley.

"You can't build a reputation on what you're going to do."

This quote, mentioned by Kulveer Taggar, underscores the importance of actions over words in building a reputation.

• Kulveer Taggar uses meditation techniques to deal with stressful situations.
• The "five whys" process is utilized at Zeus to find root causes of issues and implement corrective actions.

"Take a deep breath, sort of use some of the techniques from meditation where I try and sort of become aware of what's going on in my body."

Kulveer Taggar explains his method for coping with difficult moments, highlighting the use of meditation and self-awareness.

• Zeus has global ambitions and aims to be in every major city worldwide.
• The company's mission is to enable mobility and reduce the friction associated with moving for new opportunities.

"We have a global ambition. We want to be in every major city around the world."

Kulveer Taggar expresses the expansive goals of Zeus, emphasizing the desire for international growth and impact.

• The speakers express gratitude for the insights shared during the interview.
• Harry Stebbings looks forward to future developments with Zeus.

"You've absolutely blown me away today. So thank you so much for joining me today."

This quote reflects the host's appreciation for the depth and quality of the conversation with Kulveer Taggar.

• The 20 Minute VC podcast focuses on scaling businesses and learning from experts.
• Stripe and Intercom are highlighted as valuable resources for entrepreneurs and startups.

"But there's no playbook for building a great business. But we can certainly learn from people who've done it before."

The speaker emphasizes the importance of learning from experienced individuals and utilizing available resources for business growth.

• Harry Stebbings thanks listeners for their support and teases an upcoming special episode.
• The podcast encourages engagement with its behind-the-scenes content on social media.

"I cannot thank you enough for your support, and I can't wait to bring you a phenomenal episode on Monday."

Harry Stebbings expresses gratitude to his audience and builds anticipation for the next podcast episode.