William Leonard
Hi, my name is William Leonard, and welcome back to the Atlanta Startup Podcast. In this week’s episode, I’m grateful to be joined by Akshita Iyer, CEO, and Founder of Ome. Ome is building the next generation of smart interactive cooking appliances. Akshita, a University of Duke graduate is seeking to reinvent how we think about kitchen safety and functionality. In this episode, Akshita will dive into the experiences which led her to start her time on Shark Tank, why she turned down an $800,000 investment offer, her thoughts on crowdfunding, and why she’s chosen to make Atlanta Ome’s headquarters. I’m excited for this episode. So let’s dive right in. Before we dive into today’s episode with Akshita, I want to talk a little bit more about some of the happenings for the Valor team over the next couple of weeks. Last week we had the 15th edition of Startup Runway and it was amazing. Shout out to our winners, Cardii.io and Switch. Applications for the next showcase are now open. So, if you’re a Pre-Seed Underrepresented Founder in the Southern US and have raised less than $200,000, please feel free to apply at startuprunway.org. Next week, I will be in Tulsa, Oklahoma, attending the Tinto Capital Demo Day. So if you’ll be there, feel free to send me a DM on Twitter or LinkedIn. And also, next week be sure to catch Valor General Partner Robin Bienfait at the Dell for Startups Atlanta Pitch Competition taking place at Atlanta Tech Village on the 25th. Hopefully, we’ll see you there. Now let’s dive into today’s episode with Akshita. Akshita, nice to see you today. How are you doing?
Akshita Iyer
I’m pretty good. It’s nice to do some of these things virtually but I’m really excited to be able to share our story, especially because we just officially moved our headquarters to Atlanta.
William Leonard
Awesome. Well, welcome to the beautiful city of Atlanta. Excited to talk more about what you and the team are building, accomplishing, and solving over at Ome. Let’s kick it off here. I would love to have you tell our listeners more about Ome, what are you all practically building here now in Atlanta?
Akshita Iyer
I think what’s important about what we’re building at Ome is that it comes from a very personal story. I went to Duke, graduated with a degree in neuroscience, and expected to become a doctor but took a couple of gap years and actually, in that time, was watching a lot of Shark Tank and got very inspired by all of these people who didn’t have the traditional technical engineering or business backgrounds building solutions for their own problems. It was in that frame of mind when my own mom actually left the stove on one too many times in my house and started a kitchen fire. For many families, that kitchen has always been the center of our home. It’s where all my memories are growing up as a kid but when this happened, it was a real shock for my parents, especially since they really stopped cooking and it was really disheartening because we were early adopters of all of the early smart home products like the NEST, Ring, and the door locks. I knew that there had to be a way to bring the same kind of automation, safety, and peace of mind to the kitchen without needing to build a new appliance. That’s really the only thing I saw that was happening and what became apparent was that appliance manufacturers are not tech companies either. I decided to do something about it. We built actually, the first retrofit system that can turn any existing gas or electric range into a smart appliance in minutes. The way we do that is through this very simple device which is basically a smart knob that’s completely DIY to install. You take your existing stove knob off, you put this on, you use your stove like you do every day, you push, and you turn. The difference is that our devices are Wi-Fi connected and it’s got a built-in motor so we can actually control your appliance based on this scenario. We have features like an Automatic Shutoff which is designed to prevent the number one cause of house fires and unattended cooking. But then even more than that, with your voice assistant like Alexa, you can remotely monitor, access, and control your appliance from anywhere at any time. Cooking timers set your own recipes, and remotely control your burners all with the ultimate goal of allowing you to cook safely at home but not have to spend 30 to 45 minutes in front of your stove to do it. That’s really what our mission at Ome is to leverage the technology that we have to build a better kitchen. We’re doing it in a way that is very different from the way that others have done it in the past.
William Leonard
Very, very different from how incumbents have done this. This is fascinating. I want to dive into more about Ome and the products in a second but as you kind of think about your background and your journey to entrepreneurship, you mentioned you got a degree in neuroscience, thought you were going to be a doctor, started watching Shark Tank, what was kind of the practical path postgraduation for you to say, “Hey, I want to launch a company. I think I can build something here.”
Akshita Iyer
I can’t say that there was a practical path and, to be honest, I never thought that I would be an entrepreneur in this sense. I think I always had a knack for business, but I thought it would be in the medical field somehow. I think what was very helpful for me was that I had parents and now a husband who was very supportive of me taking risks at an early age and to just go and try and fail if that’s what happens, and you learn from it, you do something bigger and better after. But I think what really propelled me was that I could resonate with this problem. That unattended cooking is still a major safety issue at home and one of the last ones that we haven’t solved. While I didn’t have the business or the engineering background, I knew that I could find the right people who did and it’s been a difficult journey as it is for much every entrepreneur but also as a first-time female founder. I think that imposter syndrome is very real but I actually saw a post from Adam Grant the other day about impostor syndrome. Typically, what we think it means is I don’t really know what I’m doing and it’s only a matter of time until people find out that I don’t really know what I’m doing. I think where my mindset has changed is to say that I don’t know everything yet. I might not know what I’m doing today but I’m going to figure it out. That’s how I went into being an entrepreneur. I’m fortunate to have a great team of people who are way smarter than me helping me to turn this idea into now, a reality.
William Leonard
That’s an awesome story and path. Diving into more about Ome, you’ve got these next-gen smart interactive cooking appliances and your flagship product is the smart knob. You mentioned it can turn any stove into a smart one in minutes, come and talk to us more about the practical process behind that. I know you said it’s kind of a DIY device. Tell us more about that and how we can find that.
Akshita Iyer
We sell direct to consumers on our website, but then we’re also leveraging some B2B relationships with senior living communities, especially because we can have a big impact on independent living, where cooking is a major cause for concern and a reason why the older population can’t live independently. But in terms of installing it, it’s very simple. You pull your existing knob off, we have an adapter which is pretty much our secret sauce, and how we’re able to get such wide compatibility, you install that onto the shaft underneath your knob, and then you just put this back on, it locks into place. We have an app that you go through to calibrate your knob because we need to know where the high, medium and low settings are for your stove. Specifically, once you do that, you are free to use your stove like you do every day. You don’t have to use a safe. You don’t have to use the connected features if you don’t want to. We’re not boxing you into using your appliance in the way that we want you to. We are there to augment that cooking experience. Outside of that, it’s with pretty little customer education and that’s exactly how we designed it to be especially because, in your kitchen, we don’t want to be an obtrusive item. We want this to blend into your background and kind of work under the radar. You can keep doing what you do every day in the kitchen. We just make that experience better.
William Leonard
It’s such a small piece physically, but pretty enormous in importance and safety features as well. You mentioned that you are all online right now and are selling direct to consumers, but also you’re working on B2B partnerships with senior living facilities. This is pretty unique in that you’re kind of a consumer company here in the southern region where we typically see a lot of B2B SaaS, enterprise SaaS startups here. I want to get your thoughts on how you thought about a go-to-market strategy here centered around direct-to-consumer first, and then this B2C or B2B channel senior living.
Akshita Iyer
To be honest, we built some pretty powerful traction, DTC initially, because we actually ended up getting on Shark Tank. We didn’t take a deal but got a ton of visibility. We built a waitlist of over 10,000 devices. We haven’t put $1 towards marketing. We started shipping to those customers about a year and a half ago but what became very clear, as we tried to scale production was that as an early-stage startup in the grand scheme of startup fundraising, we haven’t raised a lot of money, especially with the hardware component. Having the inventory to meet demand was difficult, especially when you tack on the supply chain issues that all of us started facing last year and continue to face this year. We knew we had to find a creative way to get to scale so that we could then better serve our direct-to-consumer market. The way we look at it is at the end of the day, we are pretty much a consumer-facing product but there are ways to get to our end user that don’t require us to go through the traditional e-commerce route, at least not yet. What I noticed was on our waitlist, the vast majority of our customers were buying kits for themselves and for their aging family members. A light bulb went off where I was like, well, we need to get to scale, we need bulk orders. what if we just went directly to the facilities where the 55 and up population lives? These generally are independent living communities. We started cold calling just to see what the response would be and we got some pretty great feedback and leverage our existing technology to be able to fit that demographic. We built a monitoring and analytics dashboard, where from one touch point a facility or community manager can see in real-time who’s cooking, and who’s not cooking, they’ve got master control of all the appliances. This allows us to get a lot of devices out with just a few purchase orders and that’s important for us as a company with hardware because we need to find alternative ways to finance inventory without using diluted working capital. With these purchase orders, we’re able to build faster and also we don’t have to upfront the cost, because we’ve got five or ten thousand devices that we can go to our manufacturer and say, “Hey, can you pay for these components and we’ll pay you after you deliver them?” That was the reason for the shift and I’ve always been careful as a company with a hardware component that we don’t raise more money than we really need. Typically, you see hardware companies raising 10/20/30 million before they even get any product out. We raised a little over a million before we started shipping. Since then, we’ve raised another two and a half and that’s worked to our advantage because we found other creative ways to get to our customers and to get the product out.
William Leonard
You mentioned hardware companies typically do have to raise substantially more capital to just get off the ground. You were intentional about not raising more than you needed, was there a particular exercise mentally or just numbers based where you were saying, “Hey, this is how I’m thinking about how much capital we need to get to the next milestone without over raising?” Was there a particular thought process there? Did you work with an advisor? How did you think about how much you needed to raise?
Akshita Iyer
It’s been a learning process. In the beginning, I honestly can’t say that I was very methodical about it. I think it was just really hard to raise money but that’s a reason why I’m glad we didn’t take a deal on Shark Tank because I didn’t know what to do with that money at the time. We asked for 800,000 but did I really know exactly where that was going? No. And I think that’s also the disadvantage you have as a first-time entrepreneur, but I took the time to understand how much has to go to product development, how long that’s going to take, and how many engineers we need in-house versus what we can outsource. It took a good nine to twelve months, you haven’t even said where I really just did the math. I can’t say I’m right all the time. I mean, that we always need more money than we expect to, but just learning about what goes into building a connected hardware product and then, like I said, having a team that has built and scaled connected products have helped me to understand how much we need to get to our next milestone and not over raise. That was really the process.
William Leonard
No, that’s helpful. You’ve got to, like you said, surround yourself with a team that can help you think about different aspects of the business from various angles. That’s super cool that you are on Shark Tank as well, who did you have a potential offer from a shark?
Akshita Iyer
We got an offer from Robert. We didn’t align on the vision for the company. I think there’s so much more conversation that happens outside of the five minutes that you see on TV. What became clear for us was that he thought this was kind of a one-off product and you go and sell the company in a year or two, whereas we are building a tech company. We’re building an entire ecosystem that extends beyond the hardware. So I knew that if we took that deal, and it wasn’t the deal that we initially had gone in with, the misalignment of that vision would have become a problem. I’m glad we didn’t take it and as I said, we wouldn’t have used that money wisely. It all worked out.
William Leonard
That’s so important. I think as people have been raising capital over the last few years, there’s just been so much money in the market and readily available. You really have to get down to the intangibles when you’re thinking about taking on an investor and alignment on vision is critical. That’s a very smart move on your end. And also on this on this fundraising capital tangent, talk to us more about what your fundraising experience has been like, especially from the perspective of a consumer startup in the Southern region where we typically see a lot of B2B enterprises and we see a lot more consumer in New York, LA. What’s that experience been like fundraising here?
Akshita Iyer
Very challenging even though we have found several great investors here in the southeast like Zane, and Outlander, and we’ve got some angels here but it’s still not great for consumer startups. In general, especially for hardware, it’s not great, whether you’re in the Bay Area, or whether you’re here. I spent some time in the Bay Area and I saw and felt that the Bay is a bubble. A lot of great companies have come out of there but a lot of money goes to companies when it shouldn’t. I think building a company here in the southeast, if you can make it happen, you’ve got a company that has legs, right? Even though it’s been challenging, I now have the network out even outside of the southeast to get the money that I need to. I think one of the positives that that has come out of the pandemic is a lot of funds are looking nationally. They’re not focused on any specific geography anymore, which makes it even more possible for a company like Ome to build in a place like Atlanta. I love it because it’s not just about fundraising. Fundraising is one small piece of this system. I think more than that, and a bigger reason why I moved the company here is talent and resources. I mean, we’ve got Georgia Tech and Emory and the engineering talent that you have here is unmatched in the Bay Area, especially when you factor in cost and salary requirements, which are on two totally different playing fields. And again, as an early-stage startup like ours, we cannot afford to compete with the Googles and Apples in the Bay Area or other startups that have 10 times as much funding as us. Outside of even fundraising, even if it’s a little bit more challenging here, I think the upsides are way more. I think Atlanta is very connected to other parts of the country and people who are now here who have built and sold companies in the Bay Area, and who know everyone that we need to know. While that used to worry and frustrate me, it doesn’t anymore.
William Leonard
That’s so true. Atlanta is very well connected to the other parts of the country and even the world when you think about Hartsfield-Jackson being one of the busiest airports in the world. You’ve got the university talent here as well. The companies that are moving here, bringing talent, bringing the people here that are in the ecosystem, builders, stakeholders, things like that. You’re entirely right, fundraising is a small but important process of the company-building lifecycle, but talent, recruiting, and hiring, are all important to help you all achieve scale and meet those milestones very quickly. Really appreciate your perspective on that. Did you also do crowdfunding at the early days of Ome?
Akshita Iyer
We did do crowdfunding back when we first started building and we’re bootstrapping. We did it but it was interesting. I can’t say that I would have done anything differently because we had not raised a dime at that point and we were just putting part of our salary towards building this product. As you can imagine, it was a lot more complicated than we expected it to be. We did crowdfunding really as a way to first ensure that we were building something that people wanted and second, were to be able to raise additional funding, and at the time we were in Raleigh, Durham. Raleigh, Durham’s startup ecosystem is not built for a company like ours even less. I’ve been here in Atlanta and so I think it was great because it gave us the capital we needed to be able to finish development. But what I will say is it is time-consuming, and you have to build content specifically for these crowdfunding platforms and that can be expensive. You can’t really reuse that content. I think if there are other ways for you or for companies to test that demand and to get those early orders, then I would encourage you to look at that. If you know that you can fulfill on your Kickstarter or Indiegogo within the timeframe that you expect to, then I think it’s worth it. If you don’t feel like you need to raise any more money after that, then it’s worth it. Or if you’ve already raised a lot of money and then you want to launch a crowdfunding campaign just to get early orders, that works, too. But we were in neither of those categories and we didn’t really know either. I think, again, it was good for us but we didn’t have enough money because we encountered challenges with building a product that we hope to be compatible with all these different ranges. Especially when you work with contractors which most crowdfunding companies are, you don’t have full-fledged teams. You have to pay contractors, regardless of whether you have a product that is shippable. I think that was something that if we had known better, again, I can’t say that we would have known any differently at the time, but it’s all in all, it’s something to really think about before you execute, It’s not like a one or two-day thing. It’s this 30 to 60 days where you’re pushing anyone and everyone to come to visit your campaign and to order and it’s exhausting. And then you’ve got to get to the building. At the time, we were doing this on the side. It wasn’t until Shark Tank, which was a year later, that we really felt this could become a business. We thought that we could build a prototype and maybe just build a thousand of these shipped to crowdfunding, and then we have IP, and maybe we could license it. But we didn’t realize the magnitude of what it was that we were building and the team that it would take to be able to execute on it. Well, it’s one thing to just build a product and ship it. It’s another thing to build a product that works as intended and that also provides an incredible customer experience. It took us longer than we wanted to do that but we’ve ended up fulfilling and so at least we did.
William Leonard
It sounds like you just have to really do a deep assessment of where your business is and whether the work you’re going to put in will be worth this capital coming in.
Akshita Iyer
I think that also applies to fundraising too, right? Generally, companies want to raise venture and institutional funds just because it sounds great, and you see all these companies raising 10/20/30 million, but the reality is, that most companies are not raising like that. You only hear about the ones that are and the venture might not be the right funding source for you. You might not even need it. To be honest, even for us, where you have other connected hardware companies like Ring and NEST that raise hundreds of millions, I don’t think that’s the best path for our business because I think we can get there without that. We can leverage debt inventory financing. We can use purchase orders and I think there are so many other ways to fund your business because with every funding source, there are strings attached and crowdfunding included and venture included. I think that the deep assessment that you talked about has to happen regardless of where you’re getting your money from. Just make sure that it aligns with your business goals.
William Leonard
That’s great advice, actually. As we round out the conversation here, you were on Shark Tank. You mentioned earlier that you had a potential deal from Robert for about $800,000 but you chose not to take that deal because of misalignment in vision. I would love to get to know what your vision is for Ome over the long term.
Akshita Iyer
As we all know, the connected home has exploded, right? We’ve got technologies in every room almost that are bringing safety and convenience to everything we do but the kitchen is a big piece and a missing piece. No company has yet to bring the level of automation to the kitchen that exists everywhere else and that’s really why Ome exists. Half the population is now spending more time in the kitchen than they did before. The number one voice assistant feature in the entire home is a cooking timer. The kitchen is going to change and what’s been offered to date is not working. We have an opportunity to do that differently. The vision and our roadmap are now that we have control of your appliance in a way that no other product or company does, there’s not a stove out there today that can do what we do. What if we could control that in real-time based on what you’re cooking? What if we could know when your meat reaches the right temperature, when your pot of spaghetti boils, and when your chicken starts to brown? What if we could layer on smart recipe content and we could integrate with your Blue Apron or your HelloFresh where you can scan a QR code? Once you turn your stove on, we take care of the rest where you can save 30 to 45 minutes at a time. That’s really where we see the potential of what Ome can do, which is to bring automation to your kitchen in a way that is affordable and that’s intuitive. That works, right? There are several major appliance brands that already have connected appliances out there, but their value of them is really lost because people don’t know what they’re using them for exactly. We have a very, very clear value proposition in mind and our smart knob is one piece of it. We’ve got products and sensors in our roadmap to be able to expand on that ecosystem and also build experiences beyond the hardware. Hardware is just a means to an end for us at some point. The goal is that we can license this and just build this in so that we don’t have to build these smart knobs anymore. We can focus on the software and the services behind this and expand into different cooking verticals. You think about outdoor grilling or commercial applications and restaurants. What we hope to do with Ome is beyond just solving kitchen fires, it’s about changing the way we look at our kitchen and what our kitchen can do for us.
William Leonard
I love that. You all are seeking to reimagine the way we cook and spend our time in the kitchen. Right now, you all have this smart knob. That is amazing. But at scale, your grand vision is to capture the entire kitchen and build a connected device ecosystem that will expand to grilling in other areas of cooking, as well. Actually, that vision is extraordinary. I know that you can certainly execute it. Really appreciate your time today and coming on to share more about your journey and the experiences that you encounter that helped you say, “Hey, there needs to be innovation in this space.” And then also, you know how you all are battling impostor syndrome as a first-time founder and then also just sharing more about your fundraising and crowdfunding experience as well. I think our audience will get a lot of insight from your perspective. Greatly appreciate you coming on and sharing more about Ome, Akshita.
Akshita Iyer
Yeah, thank you so much, Will. Excited to look at and see other entrepreneurs as you build more podcasts.
William Leonard
Awesome. Thank you. Cheers. Take care.
Lisa Calhoun
We’re thrilled to have you as an Atlanta Startup Podcast listener to help you get the most out of the experience. Let me invite you to three insider opportunities from our host Valor Ventures. First, want to be a guest on this amazing show. Reach out to our booking team at atlantastartuppodcast.com. Click on booking, It’s a no-brainer from there. Are you raising a seed round? Valor definitely wants to hear from you. Share your startup story at valor.vc/pitch. Are you a woman or minority-led startup valor sister program? The Startup Runway Foundation gives away grants to promising startups led by underrepresented founders. The mission of the Startup Runway Foundation is connecting underrepresented founders to their first investors. Startup runway finalists have raised over $40 million. See if you qualify for one of these amazing grants at startuprunway.org. You can also sign up for our next showcase for free there. Let me let you go today with a shout-out to Startup Runway presenting sponsor Cox Enterprises and to our founding partners, American Family Institute, Truist, Georgia Power, Avanta Ventures, and Innovators Legal. These great organizations make Startup Runway possible. Thanks for listening today and see you back next week.
