Why We Invested in Apty
The companies we invest in are typically “boring” B2B software companies that fly under the radar during their early-stage startup journey. Our portfolio rarely makes for stimulating dinner conversation with friends and family. Potential co-investors often shy away from our deals because our portfolio companies and their CEOs don’t have the Bay Area or NYC sizzle. Apty, a startup that provides an enterprise Digital Adoption Platform was no exception.
In Apty, we found the perfect match for our investment strategy, and we were exactly the fund that the company needed.
When we’re asked to define our investment strategy, we invariably start with product/market fit and whether or not a company is ready to transition from a product/market fit mission to one of rapid scaling and expansion. Our secret weapon is our focus on helping companies through that tricky transition where many startups falter.
But what does finding product/market fit really mean? It’s not about a bunch of features in a product that is better than the competitors. It’s all about solving a customer’s problem in the way a customer wants it solved and delivering a “total product” (or complete solution) in the way the customer wants to experience it. It’s about the complete experience that the customer goes through in using a software solution to get their work done.
We could see the market pulling hard for Apty’s solution before our eyes. During our due diligence process, we saw inbound leads convert to large enterprise deals in the span of weeks, including the company’s largest contract ever with a global conglomerate. In our diligence calls with customers of Apty (and customers of Apty’s competitors), the feedback universally confirmed the pain point addressed by Apty and customers’ eagerness to find and adopt a solution.
The Best Product in a Nascent Market
Apty delivers a Digital Adoption Platform (DAP) targeted at medium to very large enterprises as well as cloud-based software vendors. A digital adoption platform (DAP) is a software layer integrated on top of another software application or website to guide users through workflows and tasks in the underlying software- like an on-demand digital training resource in every user’s browser.
In this broad market, Apty has focused primarily on large enterprises and the major SaaS applications they use internally to orchestrate complex business workflows. Examples of such mission-critical software supported by Apty include: CRM (Salesforce, Microsoft Dynamics), ERP (ServiceNow, Netsuite), HCM (Oracle Cloud HCM, WorkDay), Work Management (CA PPM, Clarity). Apty delivers its solution to large complex organizations with an elegant modern implementation that helps employees complete enterprise-specific workflows more efficiently and in compliance with the business processes that often involve transitions between multiple different software applications.
The Unsung Rockstar CEO with Founder/Market Fit
Setting aside product/market fit and the problem that Apty solves, the real reason why Apty is going to be a great investment is its founder Krishna Dunthoori. Krishna is a repeat entrepreneur with the experience and wisdom to bootstrap Apty until he was sure that it was ready to scale. His previous startup was a services firm that helped customers implement CA’s Clarity PPM software so he saw the enterprise software adoption challenges first-hand.
Without raising any seed capital, Krishna built his team in Dallas and Bangalore, built several iterations of his initial product, and deployed his product into dozens of enterprises, all in under three years. This was very similar to the path and trajectory took by the team at Ziflow, a company we funded in May of 2020.
Krishna is a thoughtful leader who cares deeply about his customers and delivering the best possible solution for them. He was refreshingly open and transparent during our diligence process and very aware of his team's strengths and gaps. It was a great match because our Platform Team skills were well-matched to his team’s gaps.
Ready, But Not Equipped for Rapid Scaling
Like many startups emerging out of the initial product/market fit stage, Apty didn’t have the complete team, playbooks, and tools to scale efficiently. During our diligence, our Venture Partners and Platform team did a series of deep-dive workshops into Apty’s messaging and positioning, content marketing and collateral, lead generation, GTM focus, KPIs, and inside sales methodology. We quickly put together the right Platform Team resources to bridge those gaps, built a 90-day plan to kick-start the expansion stage, and had our team jump into work with Krisha before the deal even closed. This gave the company an instant boost in bandwidth, productivity, and operational knowledge so no time was wasted in helping Apty transition into an expansion-stage B2B SaaS startup.
We are super excited to be part of Krishna’s journey and proud that he chose us to lead his post-seed / Pre-A round.
Firas Raouf is a General Partner at Companyon Ventures, funding B2B software startups into their expansion-stage by injecting decades of startup and VC experience through operational hands-on investing. The Boston-based firm leads post-seed, pre-expansion rounds in capital-efficient startups across North America that are ready to scale. Companyon’s capital and expertise help scale portfolio companies into a supersized Series A or non-dilutive growth. The firm invests in startups with $1-3M in recurring revenue aiming to scale by 2-3x in the first year with help from its growth-ops Platform Team that offers experience, tools, and playbooks used in top-performing software startups.