William Leonard
Hey, ladies and gents! Welcome back to the Atlanta Startup Podcast. My name is William Leonard of Valor Ventures and today I have the pleasure of hosting Yotam Oren, co-founder, and CEO of Mona Labs. Welcome, Yotam.
Yotam Oren
Thank you, William. It’s great to be here. Thanks for having me.
William Leonard
Yeah, great to have you. It’s a very cold day here in Atlanta. I think we got some flurries and it’s about 25 degrees outside.
Yotam Oren
And a late start to the schools, not to forget, but apparently, we’re having it easier than the rest of the country.
William Leonard
Yeah, certainly we are. But really glad to have you. I would love to dive right in and really give our listeners a 90-second overview of Mona.
Yotam Oren
Sure. Mona is a young startup. We provide intelligent monitoring for AI. And that sounds big, right? But you know, as AI becomes more commonplace and used everywhere, the stakes are getting higher, and companies are feeling more growth pains about being able to control and provide oversight. That’s what we do. We help scientists and engineers just get a better feel of how their AI is working. Is it working well? Is it not? What problems is it running into? Where do the issues begin, and how to improve them. It’s monitoring software that gives them really deep analytics into how their algorithms work. We are an Atlanta-based startup, we also have a large engineering team, relatively speaking, in Tel Aviv, Israel. We are multinational as well. We’re really excited about where we’re going.
William Leonard
Awesome. I’m really taking a step back here, what is the Yotam story? What’s been your path to entrepreneurship?
Yotam Oren
Yeah, I mean, it’s interesting, I took quite the winding path to get to where I am. I grew up in Israel, and I spent actually about half of my adult life in Israel and the other half here in the US. I started in the Israeli military, as most Israelis do mandatory service. And then went to university as a software engineer. My first job out of university was at a startup as a front-line developer engineer. This is really in a way kind of going back to my roots. But between that first job out of university, and now actually, most of my career was in the corporate world. I came to the US for Business School, did an MBA in the US, and then took a job with McKinsey and Company, the consulting firm, and then later work in corporate America at ADP. It’s been a whirlwind but I’ve been doing the startup now for the last couple of years, and it really feels like going back to my roots, where I belong. Definitely happy about that.
William Leonard
Awesome. You worked at McKinsey, what really influenced that transition from corporate America to really wanting to take that leap and be an entrepreneur?
Yotam Oren
I’d like to say it’s some sort of epiphany that I had in my mid-career mid-life, right? I think part of it is really just by friendship, right? My college roommate gave me a call. This is how it started. And we’ve been talking a lot. He’s one of my best friends. He’s been in kind of just north of Tel Aviv for most of his life. We’ve always been talking, this has been like 17 years in the making, we’ve been talking about maybe doing something together. I’ve had this call many times in the past, but for some reason two years ago, it felt different. It felt like it was the right time to do it. A) I think maybe I was a little more settled in my career and felt more confident that the risk maybe wasn’t as huge. And B), I think we felt like the time was right, because we were both more mature, we both had more ideas, we felt like we would be better suited to pursue those ideas. And so in a way, it was not necessarily the right time to do it, because it was a lower risk, but it wasn’t necessarily something I always knew I was going to do. Just kind of happened. And that’s a common stereo lot, right?
William Leonard
Yes. I think that is a unique way and how you fell into it, but really reflecting back on Mona here the ultimate goal is to help data science teams understand and gain complete transparency into their models, and how their data is behaving in production environments. In broad strokes, how do our data scientists and data engineers think about buying monitoring platforms for their AI systems? Are there certain things they tend to look for, as they vary by the industry they operate in? Can you walk our listeners through that?
Yotam Oren
For sure. But we first kind of have to acknowledge that monitoring, in general, is a fairly well-established discipline, in software, like outside of and infrastructure. It is really for large IT organizations. It’s very standard, almost foundational to have monitoring for software that’s running in production with customers. Now in AI, there are some unique circumstances to this, that are really driving the buying decision. Let’s take for example, by kind of understanding better the motivation for monitoring, they’re not necessarily a customer of Mona, but just like something that everyone will maybe relate to. Netflix is a lot of AI, everyone is familiar with this algorithm that recommends the next things to watch, right? Now, initially, this was just a predictive model that tries to predict what’s good for every user. Now, think about the scale that it has to get. It has to do it a billion times a day, right? In a variety of languages, for a variety of categories, to recommend movies and documentaries, and right fit of feature films or shows of different categories. It’s that not just the stakes are higher, because there are more users using it and more dollars associated, but also, the level of complexity is higher, because there are so many more dimensions to it. You might have issues with your algorithm or weaknesses in a lot more places, just a lot more places to look for. Scientists want to be able to deal with the scale, right? They want to be able to be directed at where to look for weaknesses. And so one of the things that companies are thinking about, and that pretty much runs across the board for everyone is using AI at scale, is this idea of intelligence. The idea of monitoring is a tool to focus on the right things, to learn over time, by the behavior of your algorithm. If AI is really going to work for the world, across all the industries, we have to have the confidence that we can oversee it, that if it’s misbehaving in someplace, we’ll know about it before it’s too late and before there are some negative consequences. People think about the ability to form a monitoring solution to deal with the complexity, the multidimensional dimensionality of the use of algorithms, and to be able to have the intelligence to point the scientists in the right direction of where to look for weaknesses, and where they originate. This does seem probably some high level, but it’s a good place to start when you think about monitoring,
William Leonard
Certainly. And practically speaking, can you break down to our listeners the typical customer profile at Mona? Maybe even walk us through an example of a customer success story?
Yotam Oren
Now, we are uber focused on companies that are experiencing fast growth, because we feel that there’s this virtuous cycle that companies try to master when it comes to growing with AI. AI is moving from just an enabler of the support process and all that to a real driver of growth for companies. When companies grow significantly, the dynamics for their AI change very rapidly and become harder to manage, because they have more customers, more volumes, more edge cases. For example, as we said earlier, new languages, etc. Our focus is really primarily on those fast-growth companies, and companies that are experiencing growth pains. And the idea is to give a data scientist a tool to handle all this growth in the number of models, the number of use cases, the support, etc. One example for us is the form again, and I’m trying to obfuscate a little bit because we haven’t publicly announced our customers would be in the fraud detection area where we can think about a company that provides a fraud detection service for banks. They will look at billions of bank transactions, and they will alert the banks if they’re suspected of fraud. Now, you could imagine how high the stakes are, right? Because every missed fraud is lost money, but also every false positive in this sense is also a big issue because you reject the transaction as a bank which you shouldn’t have rejected, right? Now, so this provider fraud service, we would help them ensure that if they have weaknesses in their front predictions if there is a subset of the bank transactions, or a subset of devices, or browsers that their fraud models are not as accurate, we would alert them in advance on that and make sure that they understand all the circumstances under which this happens so they can take corrective action, right? That’s a pretty common example of the kind of things that we see.
William Leonard
It really sounds like Mona has a robust, multi-faceted solution that can be used by an array of customers, which is great. Transitioning away from the technical aspect of things, looking retrospectively, Mona was established in 2018. You landed your first pilot customer in 2019 and now here we are in 2021. My question to you is what is your vision for the business currently? How has it evolved since its inception?
Yotam Oren
Great question. It’s something that obviously, as an entrepreneur, you always have to recite to yourself, because you always have to think both about the day-to-day and what’s coming ahead. I would start by saying this; we talked about the virtuous cycle. This idea of governance and oversight is an integral part of this virtuous cycle of AI. Without having really good governance and oversight, companies really will struggle to scale their AI projects, and really get the value from AI. Mona sees itself as a core enabler of that governance step in this virtuous cycle. My vision is that Mona will be integral to every AI project and really want to have Mona as part of it juggled to the cycle. At the same time, we want to be smoothly integrated into a cycle. From a product standpoint, our vision is to live at peace with a lot of really a lot of additional important pieces in the life cycle. For example, my tools to model data and to develop predictive models and tools to operationalize them and take them to customers and deploy them on devices, etc. This whole idea is that the ecosystem has to work together. This is for us, a giant industry because a lot of accounts, AI will be the next software and it’s eating software. And so if AI is everywhere, governance where AI will be everywhere, as well. We, of course, are aspiring to build a big business. We see governance as something that has a lot of precedents and justification to stay independent from other things. It is kind of its own discipline if you will. Outside of that, and this is kind of the product aspect of the vision, right? We are super excited about building a fun workplace, an inclusive workplace in a company that people want to work for, that has some unique identity, and that is driving really innovative work and making an impact on an industry, in this case on the AI industry. I think a big part of my vision is involved in just in building this company and company building and team building and all that. It’s far ahead, right? It’s big talk. But I think most of my focus, as you can imagine, as a two-year-old company is just getting through the next quarter.
William Leonard
And certainly, as an early-stage startup, your vision is more so going to stay the same, but how you achieve that vision is going to continually change. That’s great insight there. Shifting to more of your entrepreneurial journey. You’ve raised institutional capital thus far. For some of the founders who are earlier on in their journeys, maybe at the idea stage or at the pre-seed stage, can you share some insights on the practicalities of raising their first institutional capital, and maybe some tips on how to artfully navigate this daunting fundraising process?
Yotam Oren
Yes. You know, it’s interesting whenever I talk to people about this topic, in my mind it always goes to the first thing is to ask yourself whether you need to raise money, right? And if you do, is this the right time? Because not every business immediately benefits from having venture funding into it. I think venture funding comes with a certain set of expectations for growth, etc, A certain set of expectations for how you will build what you would prioritize in your early days, and etc. And so in some cases, and I think that as the most natural case for me, like deep tech business to business, it’s really difficult to get started without it. Because you can’t just create something like a facade or an app and grow virally, right? But it’s not right for every business. I would definitely start with that. Now, if you do decide that you’re going to venture out, then you have a lot of important decisions to make, I think part of them are around how much to raise, do you go with a big round right away? Do you go to a small round in the beginning? I think you have to ask yourself what you will do with the money, right? You know, are you going to try to scale a team right away? Is it going to be used just to make sure that you and the other founder’s can kind of stay afloat at the beginning, which is, by the way, no shame in doing that either, especially for folks like me, who start later in life and already had kids when they started a startup? I’d say these are really important questions. Once you would land on that, then, to me, two of the most important learnings, and I raised two funding rounds so far, have been around what to prioritize. To me, the number one thing is to find partners. To find the right partners on the side of investors, and to worry less about the things that most funders fuss about, which are like valuations and commercial terms. Of course, there are certain thresholds you have to meet, right? I mean, obviously, you don’t want to get into an agreement that’s going to hinder the company’s flexibility in the future, etc. But it’s not the most important thing, the most important thing is to understand that finding investors is like bringing another founder, it’s like bringing you to know, other people to your executive team into your boardroom and these are partners. I tried to avoid the marriage analogy, which a lot of people use, but it is kind of similar to you bringing a new family member. It’s who do you want to spend the next 10 years with, right? And so, finding my partner is really important. They’re just tips about how to be successful in fundraising. I think it’s really important to read as much as possible and talk to other founders about how VCs think. I know there are, again, differences between them, and you know, different priorities and different philosophies and investment thesis but for the most part, there’s this whole concept of the VC risk model that is really important for founders to understand how VCs think about risk, and what are the types of risks that VCs think about. When I really was just getting started in fundraising, I remember, one of the things that I came across was this framework of what are the types of risks that VCs look at different stages in a company. I would really recommend not just familiarizing yourself with them, but actually proactively inserting in your storyline in your narrative places where you address the risk without even you know, preemptively without being asked about them. Because you can really prevent some unspoken issues with fundraising. Finally, I would say to CEOs that fundraising is a full-time job when you’re raised. Really think hard about when you’re doing it, and what’s the right timing, because when you do, it kind of consumes you. It’s not necessarily the most pleasant process. I’ve had a really challenging time when I was fundraising. Whenever I do this, I plan in advance my time and know what’s going to be a big, big drain on my productivity for months, and really important to make sure that’s the right time to do it.
William Leonard
Definitely. Really echoing off of what you just said, as it can be a drain to your production and really going through that process or maybe even months at a time. How do you look for inspiration, when you are fundraising when you’re getting told no when it seems like every door that is opening is now just shutting in your face? How do you find inspiration? What are some of your go-tos there?
Yotam Oren
Yeah, that’s a really important question. One, part of inspiration is also how do you lift yourself up? Because one thing that I found about entrepreneurship that I didn’t see as much in the corporate world was just how frequently you face failure. Because the accountability matrix is just so much better defined. It’s really difficult to avoid accountability. You take everything personally as a founder. When I was in the corporate world, we did lose customers. But frankly, I didn’t feel solely accountable. I wasn’t personally affected every time. You have to deal with failure on a weekly basis. And, of course, getting told no, and the funding process as part of that, as well. The second thing is, of course, this is your own thing when you’re the founder. You need to bring your creativity and your motivation and energy every day, because this permeates, right? It reflects on the rest of the team as well, especially when you have a small team. There is no magic formula. I can’t say that I have one or two things that always work. One thing that really helps me is talking to other founders. You have to kind of find people who are going through the same stuff that you’re going through. Maybe they’re more advanced in their journey, maybe they’re less, but it doesn’t almost doesn’t matter. Because not just about getting advice, a part of it is about having a sounding board, having people that know where you are and what you’re going through. I think I found out from other founders, other entrepreneurs to be excellent in this case, and everyone you realize, when you start talking to them, everyone is looking for the same kind of conversation. That’s kind of number one. Number two is this idea of forcing yourself to take a break. As a founder, you find yourself working around the clock, and you feel guilty when you don’t work. You have to schedule your breaks and really make them meaningful. I’ve actually even had advice that I’ve been trying to follow about, don’t do anything on your breaks, either. Let’s say to watch a movie necessarily like, actually, don’t distract yourself. Just take breaks like go for a walk but don’t take your headphones with you. Really try to disconnect and I found that these kinds of breaks and conversations with founders are the two things that really, really helped me get inspired. To energize and lift me up in every face of disappointment.
William Leonard
I think one thing I really look forward to this year is taking more walks in nature. It really serves to clear my head, especially when it’s you know, mid-afternoon, two or three o’clock, you’re getting a little tired, and the day is starting to drag on.
Yotam Oren
It’s a beautiful city and you know, the weather is good. I know, maybe not year-round, but close to year-round.
William Leonard
Yeah, really going for a 10 to 15-minute walk can serve as a recharge and give you that extra boost going into the rest of the afternoon. Great advice there. Ending here on a lighthearted note would love to give our listeners more insight into who Yotam is outside of Mona. What is one brand you cannot live without and why?
Yotam Oren
I say I’m a multi-brand guy. I try not to stay too loyal. These days though the most dominant is Google. Productivity. Google’s G Suite, you know?
William Leonard
Yeah, definitely. Second, who is one person that was instrumental in your transition from corporate America to the startup world?
Yotam Oren
This has to be my wife. She’s the one who’s been through everything and just found that she gives me the hard truth whenever I need it, and whenever I don’t either,
William Leonard
Of course. And lastly, we’re only two months into 2021 What is your most anticipated tech trend for this year?
Yotam Oren
You know, I’ll give you two actually. One is remote. And I know remote work. It’s an Atlanta startup. One of the side effects of remote work is that people realize there’s life outside of the valley. And so I love this. I mean, I’m thinking last year, a lot of conversations I would have with people in Silicon Valley or San Cisco started with when are you moving here? Right, when is money moving? And today, it’s not even a topic. By the way, we love the office, and we love having face-to-face interaction and having coffee with stakeholders. But I think remote work has really changed the way people look at Atlanta startups. It’s awesome for us. And a second one, what are the top trends is this idea of infrastructure for AI. Because AI is getting to scale in a lot of places. And for us, this is a kind of fulfilling part of our destiny or our mission as a company is to capitalize on that, isn’t it? A lot of companies are looking into investing in infrastructure in AI.
William Leonard
It’s something to watch and definitely keep an eye out for not only this year but for the decade potentially. Awesome. It was really great to connect with you Yotam. And I’m excited about the types of problems and opportunities that you’re able to help your customers unlock as a team, really continue to build out the amount of product and so with that, Yotam, it was a great episode. I thank you again for joining us here on the Atlanta Startup Podcast. I look forward to closely following the team’s success. Hopefully, once things pass, we can connect in person for a coffee or something, man.
Yotam Oren
Absolutely. Thanks for having me and continue to deliver good news.
Lisa
Thank you for listening to the Atlanta Startup Podcast. You know, we’re not just a podcast, we’re a community, and we’d love to see you at one of our digital or physical events, go to valor.VC and sign up for an event that makes sense for you. We have events for founders and the investors who back them. Another event you might enjoy is Startup Runway. The Startup Runway Foundation is a Valor organization that provides $10,000 grants to founders who are women or people of color building next-generation software products. Applications are free and we’d love to hear from you at startuprunway.org. And as always, thank you so much to the organizations that make this podcast possible. Not only Valor Ventures, but also Write2Market, a tech marketing and PR agency in Atlanta, Georgia, and the Startup Runway Foundation and Atlanta Tech Park Valley’s headquarters, and also headquarters for over 100 local entrepreneurs, building global businesses. See you next week. Please bookmark the podcast and join us.
