Arda Askin has a background as a managing director and board member of a tech investment fund based in Istanbul, where he has invested and with his hands-on support enabled the growth and scaling of over 30 early-stage tech startups across many domains - B2B SaaS, web and mobile applications, e-commerce, edtech, augmented reality, and artificial intelligence.
What also makes him unique is his foundation as a systems and software engineer and distinct expertise in blockchain, web3, and cryptocurrency. In addition, he is also an active co-founder himself, being part of the innovative hazelnut company called “CRAVERS”, which implements ingredient-conscious and open-minded practices.
Intro
Tell us about your background and how you got into the world of tech and startups?
What companies have you been involved and what have you learned from them?
Arda, you’re familiar with both being in the weeds of building a startup yourself and investing in others who do it. How did you decide to make that shift from a founder to an investor? How others could make that shift?
Pain Points
AI Startup Bubbles
From the startup founder’s perspective:
Similar to Web3 and decentralized finance which did not seem to live up to the hype the high start-up valuation indicated in that sector, do you think AI startups and their solutions are also in danger of ending up the same way?
What are the common mistakes made by AI startups that lead to their failure?
Can core value proposition be based on AI alone or should it be a part of a larger solution?
From VC’s perspective:
Every startup now seems to try using AI in their description, and one might argue that you’d be stupid not to, considering that every investor seems to want to be part of the next hot deal in AI, but the significant valuation spikes and the lack of differentiation between them might make it difficult for Venture Capitalists to have successful exits. What criteria do you think the venture capitalists should consider when deciding which start-ups live up to the hype and how to determine their true value?
What do you think of OpenAI shell companies and the potential for them to be overvalued? Are you investing in companies that heavily rely on AI that is outside their control?
Have you seen any AI startups that have been overvalued and what are the signs that a startup is overvalued?
What is common trajectory of AI startups that have been overvalued?
Solutions for AI Startups
Cashflow
What should be prioritized in an AI solution to maximize its monthly recurring revenue?
What seems to be common mistakes made by the solutions?
What are typical MRRs for AI startups and how do they compare to other SaaS companies at each stage of growth? How do you think this will change in the future?
How much of expenses should be allocated to R&D and how much to marketing and sales?
What are typical margins for AI startups and how do they compare to other SaaS companies at each stage of growth?
Penetrating Markets
What do you believe is the optimal approach to selling B2B products if the goal is to have a long-lasting and profitable product?
Should the approach change when entering a new market as opposed to an already penetrated one?
How is the approach different for B2C products?
Where do you see the most potential for AI startups to penetrate new markets, geographic or industry-wise? (B2B, B2C, SaaS, etc.)
How AI helped startups
Could you share a story where integrating AI technology significantly pivoted a startup's trajectory within your portfolio?
Does it seem a requirement for all AI-oriented companies to develop their AI solutions in-house or does outsourcing software development is better in some situations?
End
Looking forward, what emerging trends in AI excite you the most as an entrepreneur?
Do you think solo-entrepreneurship will be more common in the future, because of the democratization of AI?
What skills do you think are most important for entrepreneurs to develop in the next 5 years if many of the tasks are automated?