“So, I think one of the things that age brings you is a lot less brashness, a lot less ego when you're talking about technology. It brings a lot more respect for what a lot of these financial institutions have accomplished and what they continue to accomplish.”
— Sandeep Kumar Sood
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Today's guest is Sandeep Kumar Sood, Co-Founder & CEO of Kun.ai, a consulting company that has led innovation for large financial institutions for over a decade. To date, they have shipped over 150 products for the clients, including the top ten US banks, Fortune 500 technology companies, and numerous unicorn startups.
Sandeep was also the co-founder of Junglee Games, helping the company become one of India's largest online gaming companies. Before that, he also successfully sold his first agency, Monsoon, to Capital One.
As a serial entrepreneur, CEO, and mentor, Sandeep's insights and sharings come from deep humility and experience. If you want to adopt the right stance for transforming old, archaic industries— you must watch this interview! Sandeep will take you on a journey of building the future with an appreciation for the past…
“I had the luxury to help other people before myself...
it grew me more into a mentor as a leader than it did as a hustler entrepreneur.”
— Sandeep Kumar Sood
PS Did you know the very idea of Visa was a decentralized payment rail to enable global commerce?
Highlights
Blending entrepreneurial hustle with proper mentoring and people-development skills.
Teamwork through a pandemic— how to come back stronger during tough times.
The hidden brilliance behind the financial industry.
Decentralization within financial services— not so new!
Spinning out products with success.
Acquisitions— negative signal, or, can they actually be an incredibly positive thing?
Transcript
Sandeep Kumar Sood
Thank you so much for having me, Eli. I am Sandeep Kumar Sood. I'm currently the CEO of a product development company called Kun.ai. I actually became CEO of it two months ago by a bit of a COVID story that I can share, but I have been in the world of entrepreneurship for about 20 years, have started a number of companies, most of them have been consulting companies actually did consulting as a way to start other businesses and sort of never left the industry and have found a home here. And so that's my main focus. And also had a background in a little bit of entertainment with a comic strip for quite a while. And you could talk a bit about that too.
Arjun Dev Arora
Great. Thanks so much. Yeah, I know you've had a phenomenal career addressing all kinds of different topics and areas would love to maybe start by sharing a little bit about Monsoon and maybe talk through your journey with that. And then the work with Junglee and maybe in Monsoon, would love to hear a bit about outsourcing and offshoring. I know you were really a pioneer in that work. And so we'd love to hear a bit more of your story on how you made that work for so many, so many companies.
Sandeep Kumar Sood
Sure. The first time I hired an Indian team to get a project done was in 1999. And so this was really when outsourcing or at least outsourcing of software was beginning, because we had this little thing going on at the time called Y2K. So, for the first time, I mean, there was some happening before that, but en masse the first time American companies really began realizing the level of technical expertise in India and other countries was because of Y2K. And you had these armies of Indian engineers combing through code looking for the right date format. And of course, that emergency never materialized.
But all of the communication networks, a lot of the biggest piping was laid down during that time across the ocean to make that possible. And so we were struggling back in the days of Skype to do collaboration, struggling to share 1.2 MB files sometimes, and now, I am really tickled by the fact that suddenly remote work has overnight become a ubiquitous thing.
Arjun Dev Arora
Yeah, that's awesome. And maybe tell us a little bit about the Monsoon story. I know it was a phenomenal journey.
Sandeep Kumar Sood
Yeah. It's really cool. I think my first few years running is when I met you. Yeah. And probably that, to me, one of the most unique things about Monsoon is it was started by four childhood college friends. And that has never changed since then. We've started four more companies together all with the same four partners. And that group has stayed really tight. So the adage of, of never working with your friends, we've broken with every single thing we've ever done, and it's worked out really nicely for us.
But Monsoon started with myself doing some basic outsource as I talked about, we then grew it to 50 employees in Oakland, and then sold the most of the company to Capital One in 2015. Really unique situation because Capital One was interested in our engineering talent, a bit of our IP, specifically the IP we had built for them. But what they allowed us to do is they allowed us to keep our clients and keep a couple of people on. And so we essentially started another consulting company with a new CEO. I went into Capital One for three years and work there got a good handle on the financial industry. And while that was happening, this other consulting company Kun.ai has grown and is now this mainly FinTech focused consultancy that I'm now back at the helm of again.
Elias Rubel
So did the FinTech angle come out of Capital One or was that something you were already interested in.
Sandeep Kumar Sood
Yet even before they bought the company, we randomly ended up with clients like Bloomberg Capital One. And really were astounded by how far back or how far behind the financial industry was, in some cases, even compared to industries that you consider backwards like healthcare.
And so this for a consulting company, particularly when you're selling labor, is a really attractive space to be in because there's just so much to be done. There's no department that isn't five years behind. And so you can really get in and accomplish a lot. And around the time that Monsoon got bought in 2015, was when Plaid was starting to come up when a lot of the integrators are really starting to become successful. And just watching that tremendous change, watching FinTech go from a buzzword most people haven't even heard of to suddenly the first trend everyone mentions has been really fascinating.
Elias Rubel
Whenever acquisitions are talked about, it's sometimes people have to be kind of secretive just due to legal issues. But I'm curious if you can share some of the details of that story. And perhaps, you know, I think a lot of people assume when they read about an acquisition, that they're all cut and dry, and a lot of times they aren't. Are there any elements you could share with us about that might be surprising for folks.
Sandeep Kumar Sood
That's a really good question. I would say, generally speaking, the acquisition for us because a lot of times and I imagine one place the questions coming from is you hear a ton of horror stories about acquisitions, where to the point where some friends after we got bought were like, should I congratulate you? Is this a good thing? I don't know. And I totally get that.
In our case with Capital One, they were tremendously generous, not just in the terms of the deal but also in making sure we were comfortable with every non-financial term of the situation as well. So, for example, it's not normal for a company to buy your company. Then after listening to you, we were like, look, all you guys want is our talent. We know we understand that this is a talent acquisition. But would you allow us to continue with our clients, if we all just promise we're not going to touch the company for three or four years. And amenability to that just shocked us. We couldn't believe they were willing to listen and really accommodate that request. So, fortunately, for me, I have nothing but but good things to report from that acquisition. Yeah.
Elias Rubel
And when you were there, I know you had worked on a lot of really interesting projects inside of Capital One and including everything from kind of building new things to exploring other startups and continuing the conversation— is there something you can share about what your experience was like as into the, you know, transition and as part of the integration and the work you did there?
Sandeep Kumar Sood
Yeah, this is probably where I promised, I'm going to turn it around on you a little bit to Arjun because I think, in a lot of ways, that phase of our careers was very similar, because I went into a big company for the first time since I was 21. And before that, I think entrepreneurships amazing. But you're always paranoid. You're always trying to break that next deal for yourself. You're always worried and you're kind of always in hustle mode.
And those three years at Capital One was one of the first times in my career, I had the luxury to help other people before myself. It's one of the first times I got to kind of look over like a whole industry or a whole market, get to know specific entrepreneurs and understand all that. And I think if I asked you the question, you would agree like the last, that experience for me was pivotal in that it intrigued me more into a mentor as a leader than it did as a hustler entrepreneur.
Arjun Dev Arora
Yeah, yeah. Thanks for asking. It's always fun to have it flipped around. So no, I think I feel fortunate that I've been able to at different phases of my career have been able to kind of zoom way out and really look at things from an ecosystem level and just again, to be helpful, whether it's funds or, or founders, and there's a uniqueness of that part, which I'm deeply grateful for, that really allows you to have the impact because you can see things from that vantage point. And, you know, because you have the ability, capacity and experience to, you know, to lend a helping hand. So, yeah, again, very grateful for being able to be in that position.
Elias Rubel
Is there a certain thesis that you have right now with Kun.ai and kind of the way that you look at obviously, there's tremendous opportunity out there, there's these deep backlogs, what lens you're viewing this through.
Sandeep Kumar Sood
So, I have always until this moment, I've been really insecure as an entrepreneur because I'm in consulting and not a product business right. And every six months from the beginning of running consulting companies, and now like even this week, we're looking at products like what product? Could we start? Should we package what we're doing, then the thesis that's emerging is that in the financial industry, there's a lot of other places like this to like healthcare. This to me is a moment for the industry when consulting and labor is equally if not important, if not more important than SaaS companies in the space. And the reason why is you have these archaic systems, a lot of them are automated to an extent, but you have these core banking systems that have been in place for decades. And you need to extract terabytes and terabytes of data from these systems. And what all of the SAS companies doing are doing is developing another API, another API, and of course, they're extremely successful, but there's also a niche for people who are willing to run sleeves up to help these banks implement 15 API's instead of one, to build layers around them to vote wrappers around them, and to really take a lot of the amazing work that's happening in SAS, and actually help banks use it. Because most of them don't even have the capabilities and how to take advantage of these products. Because your data stores their core systems are so out of date, that they can't even get the data out of them in a reliable way.
Elias Rubel
So, I'm curious because, you know, when you think about traditional consulting, business and growth, right, these are, you're working much larger, much longer deals. So how do you model out growth and approach that in the industry?
Sandeep Kumar Sood
Yes. So one of the first ways we did that is by actually picking an industry. So for years before this, I would get on the phone with people, they'd be like, so what do you do? And I'm like, well, if it's digital, I do it. And so that already confused them. And they'd say, well, what kind of clients do you have? And I'm like, well, if they use computers, they're my clients. And so it was no focus whatsoever.
And so the last five years, I've really enjoyed getting into one industry and my outlook for the next five years. We have a very specific thesis and that's what our clients are, generally speaking, we have some unicorn startups as clients and stuff as well shout out to them. I don't want to say that I don't want them as clients. But we really want to help the tier one and tier two banks, tier one and tier two insurance companies. We really want to help them get on if not equal, at least comparable footing to the FinTech startups technology wise.
There's a lot of community banks that have much better context about their geographic region. There are credit unions and banks that serve specific industries. And their context is a huge competitive advantage. It's just that their technology is so far behind that it's going to take a good ganju and effort for them to start leapfrogging and getting to the point where they can compete. And we really think we fit a niche there. We feel like we are one of the few companies that speaks their language, and understands the FinTech ecosystem, and so we can bridge that divide and help them out.
Arjun Dev Arora
And as part of bridging that divide, often these things are not solely technology, you know, challenges, there's a very deeply human kind of change management and leadership challenge there. Would love to hear about some of your lessons learned as you've helped some of these, you know, larger organizations that have been around for, you know, 10s of years, in some cases, hundreds of years shift into some of this new technology, what what are some of the things that have worked and what maybe has been challenging?
Sandeep Kumar Sood
So, I think one of the things that age brings you is a lot less brashness, a lot less ego when you're talking about technology. It brings a lot more respect for what a lot of these financial institutions have accomplished and what they continue to accomplish. And that sort of young guy's attitude of, okay, dinosaur, let me teach you how to dance now is just not it's not it's not as much there anymore.
So, I think the biggest, biggest lesson and I needed this more than most people, I think is the humility to respect what executives are capable of within their niches while still being cognizant of the advantage that we bring being so steeped in technology. So I mean, there's a lot of lessons that I've learned through the years, some of them from you, on how to deal with these things better.
But right now, I think the last two years have really been marked by getting a better sense of humility for what the context is, what the limitations of a context are, and how to still maneuver efficiently within that context without just complaining and yelling and screaming because things aren't moving exactly the way you want.
Arjun Dev Arora
Oh, thank you. Yeah, it's a unique time in history— some of that leapfrogging is happening and I think helping folks manage through it is non-trivial and quite challenging work. Maybe just to switch gears a little bit on the product side, just as you have built so many incredible products, both for your own purposes and on behalf of some of your other clients. And maybe if you can share some of your stories on products you've built, whether it's you know, the Junglee you know products are some of the other ones you've done and, and kind of what's worked well and what have you learned from those experiences?
Sandeep Kumar Sood
Yes, so one of the things I continue to want to do but one of the rare moments in a consulting companies’ history is when you can spin out a product successfully. It's it for some reason, it's just impossible. Very few could fall. Things companies ever do, we all talk about it. We all have the labs division, and we all try to make something happen inside of that. And we have failed at it many, many, many times. But there are some really fun exceptions...
So, over a decade ago, one of our business partners, one of the four core partners, and a good friend of both of ours was taking an idea for an industry that we had learned about from a client and was playing around with this idea of online gaming in India. And keep in mind this is over a decade ago, internet penetration is exponentially lower in India than what it is today, internet infrastructure is terrible, broadband is low. And so we were at least five years too early in a market where core e-commerce wasn't in place yet.
We're already looking at gaming and fantasy and all this kind of stuff out in India. And most of us inside the company were highly opposed to it, it was really complex, massive multiplayer games are really difficult to pull off in the US, much harder to pull off when there isn't good bandwidth. But he stuck with the idea all of us supported him. And we now turned it into the second largest online gaming company in India. And it's just continuing to grow and only exponentially growing faster because of COVID. And because of quarantine, and all that. And that, to me was the first time I realized that product development actually is possible in a consulting company. You just need to have enough people who are abstracted from the day to day to really do those cycles over and over again, to deal with the inevitable ups and downs and build something really useful.
Elias Rubel
What signals have you looked for in the past, you know, as you said, you've been through many years. The cycles and try to spin things up and then I decided to shut them down. What signals were you looking for? When you got to the point you decided, Hey, you know what, let's move on to the next thing. Let's try.
Sandeep Kumar Sood
So the funniest thing about that is that the, the times we've succeeded the most is when we didn't even bother to look for signals at all. So, the story I just told you with the car game, if you ran a market analysis on online gaming in India in 2004, you'd be like, that's okay. That’s the dumbest idea I heard this year. Let's move on to something like social networking that actually makes sense.
And so I say that a little tongue in cheek. But with that said, we've become more diligent about researching markets now. So I'll give you an example from the last two months. So a few months ago, COVID hit and I went from being a board member to CEO of Kun.ai because of COVID. Our former CEO had some family issues that came up directly as a result, and neither the time away. And we also lost a large number of clients. Either they downsized, some cancelled one or two went under.
And so we suddenly had a bench full of really strong developers with no clients. And we decided, rather than laying people off, we would just ask the entire company to take a short term pay cut, which we've now gladly gotten past. And during that time, there was just time to work on whatever anyone wanted to work on. And we were open to ideas.
And so two of our developers began working on an open sourced, Bluetooth low energy way to enforce social distancing between people. So, it's really simple. It's whether your app is active or not, whether it's Android or iPhone. If two people have it installed, an alarm will go off if they're within six feet of each other.
Now, it won't work on a mass scale. Because we're not going to get millions and millions of users, but if someone at a factory wants to implement it and tell everyone to download the app, it suddenly works really, really well. And so we supported the idea it wasn't our vision. But to answer your question, it was obvious there was not much research needed to be done to note product market fit was there, if we could do it. And they kept going with it, we began supporting them putting some dollars and marketing strategy behind them. And as of last week, the United Nations is going to integrate our code base into their official app. Now, not a huge business success because we're not getting paid by the United Nations, but it's really cool to see them use the software and take it further.
Arjun Dev Arora
Amazing. Just in the last couple of minutes that we've got left would love to hear your perspectives on particularly since you're kind of knee deep in FinTech these days, around where you think, you know, some of the more interesting trends are in that space specifically or you know, or and Anything around kind of product and development, but maybe would love to start with FinTech?
Sandeep Kumar Sood
There are two, there are two areas I'm most interested in: one is extremely cutting edge. The other one is actually not cutting edge, but much more necessary.
So we've talked about the first one, I want to bring banks and other financial institutions to the present. And specifically, what that means to me is opening up their tremendous stores of data for other fintechs to use for them to use in ways that they want. And by doing that, you're sort of doing basic things to bring them up to par. But what you're doing at a deeper level is you're suddenly enabling an exponential number of startups to come up with ideas that leverage this data. You're enabling internal innovation there. So, the first one to me is really the whole world of API integrations for banks, and that means the back end of their data all the way up to the fintechs and leverage it.
The second place I am becoming more and more obsessed with is just payments in general. So this means credit card innovation, everything from new solutions for short term credit at the point of sale. So, there's one model we have for the point of sale in terms of extending credit now, which is you give a credit card, you pay whatever rate that credit card charges you. But there are hundreds of other ways to do that in ways for different levels of purchases, different frequency of purchases, that would make credit a lot more manageable for people. And the credit card companies are very interested because the more ways they can offer credit, the more types of cards and products they can offer. So, we're working with them on that.
And then as you know, I'm also very interested in everything involving payments all the way through to cryptocurrency and I don't really look at them as a separate stack anymore. I think elements of crypto are going to enter into everyone's model. And I actually think most people don't know the history of the credit card, but the very idea of the credit card, the very idea of VISA was a decentralized payment rail to enable global commerce. And a lot of the times when you listen to the founders of credit cards talk, if you hide the site or the book, it sounds like a Bitcoin pioneer talking about the future of payments. So, I just think there's a continuity there. And there's a lot of interesting things coming down the pipe with payments in general.
Arjun Dev Arora
Awesome. Well, thank you so much. They really really enjoyed the conversation and thanks for sharing so many awesome insights today.