A few years back, Jags Kandasamy walked into his first investor pitch with little more than a PowerPoint presentation and a bold vision for Latent AI.
Unlike many founders, he wasn’t armed with a fully built product, but he had something else that caught investors’ attention: a proven track record and a deep understanding of how AI could transform industries.
Within two rounds of funding, Latent AI raised over $22 million.
I recently sat down with Jags to discuss his journey in building Latent AI.
As Jags puts it, “At Latent AI, we’re solving a key challenge: how to bring about ubiquitous computing across all hardware. How do we make AI available on every device spread across the world?”
With the number of connected devices expected to explode to 40 billion by 2030, Latent AI is building the tools and infrastructure to help developers harness the massive amounts of data these devices will generate and provide intelligence at the edge.
His experience is a reminder to early-stage founders, particularly in AI, that technology isn’t always the most difficult part, however. Building the right team and gaining investors’ trust often pose greater challenges.
Investors are increasingly focusing on the founder rather than just the product. A survey of 437 European investors found that 49% of VCs consider a startup’s management team the most important factor in their decision to invest.
Jags’ ability to execute, attract talent, and cultivate a transparent, value-driven culture was crucial to Latent AI’s success.
Partnering with co-founder Sek Chai, who brought complementary technical expertise, also helped reduce the technology risk that deep-tech startups often face.
By addressing a unique market need—helping developers transition to edge AI, a niche largely overlooked at the time—Latent AI positioned itself strategically, combining a working solution with strong research backing.
This broadened their market appeal and drew significant investor interest.
In our conversation, Jags dives deeper into these topics, offering valuable lessons on building strong teams, navigating investor relationships, and seizing niche opportunities.
You can listen to the full discussion below or keep scrolling to read the full transcript.
Contents
About Jags & Latent AI
Rui: Could you give us an overview of Latent AI and the value you wanted to create when you first set out to build it?
Jags: I started my first company right out of college at 21, back when the internet was in its infancy, in the digital marketing space. That journey led me to several roles in both enterprise and retail. Most recently, I’ve co-founded Latent AI.
At Latent AI, we’re solving a key challenge: how to bring about ubiquitous computing across all hardware. How do we make AI available on every device spread across the world? You’re probably familiar with the computing device in your hand—it already supports AI. But in the next few years, the number of connected devices is expected to explode. Gartner, for example, predicts that 50 billion devices will come online in the near future. Imagine the sheer volume of data those devices will generate.
We’re building tools and infrastructure to help AI developers harness that data and provide intelligence at the edge.
Rui: How did the idea for Latent AI come about? Where did it all begin?
Jags: I’d like to take a step back from Latent AI for a moment. Before Latent AI, I was running a startup called AutoSense. At AutoSense, we automated human hearing. What we did was listen to non-human sounds and extract meaning from them. For instance, we could distinguish between someone knocking on glass, wood, or steel.
We applied that technology to the industrial ecosystem, specifically in manufacturing. If you think about it, a good mechanic listens to a machine before they touch it to diagnose the problem. That’s essentially what we were trying to solve—acting as a human ear, listening to sounds.
Now, imagine the first time you’re doing this—you’re trying to listen to sounds, streaming them to the cloud for processing, and then sending the information back down. A couple of things can go wrong, and they did. The first issue is bandwidth. The available bandwidth for transmitting sound, whether through mobile carriers or the internet, is limited. You don’t want to congest that.
The second issue is latency. Let’s say a machine has a problem, like a ball bearing going bad. If it takes 30 seconds or even a minute for that sound to go up to the cloud, get processed, and come back with instructions to stop the machine, it could be too late. You might face a catastrophic failure. So, you need to put all the computing and processing right next to the machine—this is what we call edge computing.
We managed to solve that particular problem. Fast forward, and AutoSense was acquired by Analog Devices. After that, I joined Stanford Research Institute (SRI) as an Entrepreneur in Residence. SRI, as you might know, is the birthplace of technologies like Siri, Nuance Communications, and many other cutting-edge innovations.
While I was there, I met my co-founder and current CTO, Sek Chai. He had developed a method to compress neural networks into smaller sizes. That’s when the light bulb went off for me. I saw the connection between what we did at AutoSense and what Sek had built at SRI. That’s when the idea came to create a platform that enables edge computing for AI—not just for one use case, but across the spectrum.
And that was the seed of Latent AI.
Finding the Right Co-Founder
Rui: You mentioned meeting your co-founder and current CTO at SRI. How did that relationship evolve? How did you go from meeting him to deciding to build Latent AI?
This is something we talk about often with the entrepreneurs we work with, especially non-technical founders who need help building their products.
We always advise them to have a co-founder—either you’re technical and need someone with business acumen, or vice versa.
The ideal option is to have that knowledge inside the team, but it’s not easy to find the right person. So, what key insights can you share about finding and vetting a co-founder? How do you know they’re the right person to partner with on a project as important as this?
Jags: Absolutely. You’re right—it’s like a marriage. Founding and running a company is a five to seven-year commitment at a minimum if you want it to succeed. Meeting Sek, my co-founder, happened thanks to SRI. They have a program that brings in entrepreneurs like me and matches us with technologies and potential co-founders or technical experts interested in building a company.
The first thing with Sek was that we had a common goal—he wanted to come out and build a company. That alignment was there from the beginning. But you still have to vet that person. You need to be sure this is someone you can work with for the next seven, ten, or more years. It’s important not to second-guess your choice after you commit.
We had phone conversations for almost a month. He was in Princeton, New Jersey, and I was in California, in the Bay Area. Even though I didn’t have a job after the exit, I had social commitments and travel plans. Sek, on the other hand, had a job and was running a team, so he was busy too. We could only find one time to meet that month, and it was in Chicago.
Sek was attending a conference there. He arrived on a Monday, and the conference started on Tuesday. He offered me the Monday afternoon, so I took a 4 a.m. flight out of San Francisco to meet him. We spent the next six and a half hours together, just talking and whiteboarding ideas in a hotel business centre. We didn’t even notice the time flying by.
It felt like we instantly connected—on the vision for the company, what it could be, what we could build. He was a partner from day one who could see beyond just the technical limitations. Most technologists tend to focus on what they can do, but sometimes they’re limited by that perspective—they don’t think about what could be. Sek didn’t have that problem.
As a visionary and product person myself, I found a technologist who shared that vision and could see the bigger picture. It was a match made in heaven. As they say, we locked horns that day and said, “Alright, let’s do this.”
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How to Validate a Startup Idea
Rui: I can relate to that. When I joined Altar, the goal was to elevate the marketing department. Daniel, one of the founders, approached me to help set the strategy and build the team. We spent an entire afternoon discussing ideas—not about money or terms, but about the future. There was this instant alignment, where you just know you’re with the right people to build something together.
I completely agree with you—having a co-founder with complementary skills is crucial, but even more important is philosophical alignment.
Now, back to the start of Latent AI. Your path to building the company is clear, but many startups fail due to a lack of market need. Founders often have insights but don’t always validate them.
Your idea seemed grounded in strong insights. How did you validate it? I recall reading on Founders Network about you sharing your idea with your network, even their networks. Many first-time founders protect their ideas, missing out on feedback. What’s your take on idea validation?
Jags: My advice to would-be founders and entrepreneurs is that ideas are a dime a dozen. Ideas don’t make companies; execution does. If you have an idea, you need to validate it before spending any time on it. Time is never recoverable. Money is. You can lose $100,000 and earn it back in a couple of years, but your time is gone forever.
Between AutoSense and Latent AI, I went through about 12 different ideas before landing on this one. Even within SRI, we explored a few ideas before finalising. My mentor and advisor, Steve Dyer, who was the CTO at HP, played a key role in this process. He’s a good friend and acted as my devil’s advocate.
We would take long walks in Mountain View, and I’d bring him every idea I had. He’d poke holes in them, and most would fall apart. I’d go back to the drawing board. But with Latent AI, something was different. We walked for two and a half hours—our longest walk yet. He tried to find flaws, but eventually said, “I don’t see any problems with this. You should spend more time investigating.”
That was my first green light. After that, I formulated use cases and spoke with CIOs, VPs of IT, product managers, and security experts. One of my strengths is networking, so I reached out to people I had met throughout my career. But the key is not just asking when you need something. Building a network is about giving back—paying it forward. That’s the Silicon Valley culture, and it’s something I live by.
I asked them questions like, “What if we had this technology? What could you do with it?” You don’t want to lead them, but you want to help them see beyond the curve. Their feedback helped validate the idea.
Even though we were spinning out of SRI, I had to go before the SRI board to convince them to spin the technology out and let me run the company. In that presentation, I included a slide with quotes from customer conversations—feedback from SVPs of IT, product managers from consumer tech companies, and others.
I had eight quotes on that slide, and that sealed the deal with SRI.
The Importance of Founder Mentorship
Rui: Tell me more about your mentor. How important was he to the start of this project?
Jags: First, I want to set the foundation: who we are and what we become is based on the circumstances we grow up in. For example, if you grew up in South India, you’d probably love rice, dosa, idli, and be drawn to cricket. But if you grew up in Portugal, you’d likely love football. Our culture defines us, and each of us has certain foundations that are shaped by those experiences. When we’re born, we’re like empty hard drives.
What we learn is based on what we’re exposed to, and we form opinions accordingly. But the key is that if you’re introduced to new information, you should be willing to listen and adapt your opinions. That’s the foundation of who I am.
With that in mind, I always seek mentors in fields where I want to improve or learn more. I believe life is a continuous journey of learning. Steve Dyer and I met about eight or nine years ago at HP, where he joined us to help build and take a product to market as a product strategist and technologist. We hit it off, and I knew his credibility—he was the CTO at SuccessFactors, which was acquired by SAP.
Since technology wasn’t my strong suit—I’m more of a product, sales, and business development guy—I wanted to learn from him. We’d go out for lunch every other week, and I’d pick his brain about what he was doing. Over time, we formed a closer connection, and he became a strong supporter of mine, helping me think through many of my ideas.
Acquiring Early Adopters
Rui: That intellectual humility—the ability to recognise that you don’t know everything and to stay curious and keep learning—is a key trait.
Let’s change gears a bit, though not entirely. Let’s talk about early adopters. What was your strategy for acquiring those crucial first users?
Jags: Again, it came down to the network. My network showed up for me. People wanted to know what I was working on, and what I was building. In the first year, I had around 79 or 80 conversations with potential customers.
Now, we didn’t want everyone to come in as early adopters because we were building a deep-tech infrastructure product. That kind of product isn’t ready for market for a couple of years—it’s pre-alpha, almost pseudocode at that point. You’re showing bits and pieces, validating steps along the way.
But from day one, we had customers interested and willing to take meetings. They gave us feedback. One of our first design customers, an automotive OEM, was key in helping us shape the product. They told us that developers wouldn’t want to learn a completely new UI. But if we could integrate with what they were already using, it would make adoption much easier.
That advice helped us build most of our tooling into a character user interface, so it could be scripted and called like an API, rather than through a GUI.
The Journey to Product-Market Fit
Rui: It highlights the importance of building with the market and listening at every step.
While your roadmap differs from typical SaaS products, I still see many founders, especially early on, hiding behind a brand they haven’t built yet.
They think they need a polished website that sells for them, but it often fails because it lacks key elements like arguments and peer proof that drive decisions.
Early on, founders need to make those first sales. Early adopters buy into the vision, not the product because the product is often incomplete.
It’s vital to put yourself out there, engage with people, and sell the vision. Otherwise, you risk running out of money before getting users, which happens all too often.
Now, let’s talk about your journey to product-market fit
Can you share lessons from that phase, up to raising your first meaningful round?
Jags: I raised money with the presentation, not with the product.
Rui: Perfect—so pre-product?
Jags: Pre-product, yes. We raised our first seed round in the spring of 2019. I had already been talking about the product. We incorporated the company in December 2018, and we were going through the licensing process with SRI to spin the technology out and get it ready for Latent AI. That process took about six months.
But in the meantime, once the licensing agreement was signed, I was able to raise money just based on that agreement and the vision for what we were going to build.
Raising Money & Dealing with Investors
Rui: That’s impressive. Technology has become more accessible, not just through low-code platforms, but in general, making it easier to build something. Investors see hundreds of projects daily, so it’s harder to stand out.
For founders, raising money is tough, even with plenty of capital available. You hear about big tech investing heavily, but that’s limited to a specific segment. For most, investor interest hinges on user adoption. If you have early traction or have bootstrapped, that’s the usual route.
So, what was your secret to raising money with just a PowerPoint presentation?
Jags: It comes down to who you are and the team you’re bringing in. When investors put money into a seed round, they’re not investing in the company—they’re investing in the people. The question is, are Jags and Sek capable of building a business around this kernel of an idea? Do they have the ability to attract and build a team?
Investors want to know if you can execute, build a product, and lead a team. They’re looking at your ability to raise more money, attract customers, and sell that first product—and then the second. That’s what they’re investing in.
Rui: It’s easier if you’ve had an exit—while you don’t need to be Elon Musk, having a track record signals to investors that you can succeed again. That’s a common challenge for first-time founders.
Take Reddit’s founder, for example. He was initially rejected by Y Combinator, but they liked him and invited him back to build Reddit. They believed in his potential, not the idea.
Let’s dive into your experience with investors. What tips do you have for entrepreneurs?
Jags: Raising money as a founder involves three things: selling your vision, selling your shares (raising money), and selling your product to prospective customers. You should never shy away from these three tasks. You’re always fundraising, even when you’re not officially raising a round.
For example, I’m not raising a round right now, but I’m still having conversations with potential investors. Fundraising is like enterprise sales—it’s not a quick, transactional process. You don’t just walk into a VC’s office, present your idea, and walk out with a $5 million cheque. That’s not how it works.
It takes time. Investors want to get to know you, understand the space you’re in, and do their diligence on how big the market is, who the competitors are, and how differentiated your product is. It’s a relationship-building process. That’s why you start engaging with them long before you need the money. Be upfront—tell them you’re not raising a round at the moment but want to show them what you’re working on and get their feedback.
Investors are at the intersection of information exchange. They see a lot more companies and startups pitching, and they’re talking to enterprise customers and focus groups. They know what’s going on in the industry and the startup ecosystem.
For example, if you say, “I’m building this widget,” they might tell you, “That widget was solved seven years ago.” They can help you short-circuit some of your thinking or accelerate your progress. Always approach with the mindset that you know what you know, but there’s a lot you don’t know. Let them educate you.
But also, don’t get swayed by everything you hear. One day you’ll go in one direction, and the next day, another. Soon, you won’t know whether you’re coming or going. Don’t be that person. Be a sponge, absorb the right information, and keep your focus.
That’s how I’d approach building an investor network.
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Culture & The Early-Stage Startup Team
Rui: Let’s switch gears a bit and talk about your team. Who else was there in the early days?
Jags: My first hire was my Head of Engineering, Mark. He came as an introduction from one of my investors. We met, and I immediately loved his profile. We spent at least three or four hours together—half a day, including lunch—just riffing on ideas. We wanted to make sure Mark understood the vision and was willing to take the risk.
As the first employee of a startup, you’re taking a risk. At that point, we hadn’t even raised the money yet. But Mark came in with complete faith that this was going to be something special. He’s still with us today and is building a great organisation around him.
Before that, I have to mention Chloe, our CFO and COO. She was my CFO at AutoSense, and we’re good friends. When I started Latent AI, I didn’t give her a choice—I just told her, “You’re my CFO. Come in and run operations and HR for me.” And she did.
It all comes down to who I am and how I build my network. When I go calling, people come. That’s how I brought together the initial team members.
Rui: Chloe’s role is so important. If you lose sight of the numbers, even for a couple of weeks, it can lead to serious problems.
Having someone who serves as the operational arm, making sure everything runs on time, is crucial, but often overlooked in the early stages.
Jags: Absolutely, and Chloe isn’t just handling the financial side—she’s also in charge of HR. She takes care of every employee that comes through the door. One thing she did, which I hadn’t even thought about, was to rent corporate apartments in Princeton, where our engineering headquarters is located.
We were bringing in a lot of graduate students, PhDs, and postdocs for internships and full-time positions. Chloe suggested we rent some corporate apartments so that when these employees arrived, they wouldn’t have to worry about finding a place to stay right away. They could focus on work and take their time looking for permanent accommodation over the weekends.
We’ve now got three corporate apartments in Princeton. New employees can stay there for a month, free of charge, while they settle in and find their place. That was all Chloe’s idea. She’s focused on ensuring our employees are well taken care of so that everyone can stay productive and move in the same direction.
Rui: This touches on an important point. Hard skills are important, but most of them can be taught. Soft skills and a people-first mindset are harder to come by, and Chloe is a great testament to that.
Let’s talk about a couple of lessons on attracting and keeping people happy. It’s clear you care deeply about your team, and the way you approach networking and relationships shows that.
What lessons would you share about attracting talent and maintaining a strong, happy team?
Jags: Attracting people starts with getting them to buy into your vision. When your vision is larger than life—like what we’re doing, literally bringing the third generation of computing into the world—it captures people’s attention. What Web 2.0 did in the 2000s, we’re doing with AI in the 2020s. When you have a mission like that, you have to be unashamedly clear when explaining it to the people you want to attract.
Rui: Is that a one-time thing?
Jags: No, it’s a continuous process. The vision needs to stay front and centre. You have to keep putting it in front of people. It’s not just a one-time pitch.
Rui: Consistency over time.
Jags: Exactly. People forget, too. You’ve bought into it because it’s your company, but you need to keep repeating it, making sure everyone understands and stays aligned with the vision.
That’s how you attract people and keep them engaged. Then, it’s about ensuring they’re doing what they want to do, matching their aspirations and skills with the work that needs to be done. If there’s no match, then they probably shouldn’t be in your organisation.
A Day-in-the-Life of an Early-Stage Startup Founder
Rui: I get that. When I joined Altar, the goal was to turn this company into the category leader for product development for founders. Our mission is to ensure that no founder is held back from creating solutions that could help millions, simply because they lack the technical ability or can’t find the right technical stakeholder.
We consistently push that message in every engagement, and I believe in the power of consistency to align people with your vision. It’s also crucial to bring in people who share your mission and are happy in their roles—that’s how they stay productive and committed long-term.
Now, on a more personal note, what did a typical day look like for you back then? How many hours were you working, and how did you manage your focus when starting the company?
Jags: Back when I started the company? It was a lot of reading—catching up on industry trends, and understanding where the technology was heading.
Another big focus was shortlisting investors who were already focused on AI and edge AI, people who didn’t need an explanation of what those terms meant. I wanted to find investors who had this as part of their thesis, and then I’d work on finding warm introductions to them through common connections.
In addition to that, I spent a lot of time talking to potential customers. If someone mentioned edge or AI, I’d try to connect with them and understand their perspective—what they meant by that, what they were looking for. I was also thinking about the team we needed to bring together.
Overall, I focused on five main areas each week:
- Product – What we were building and what the product roadmap should look like.
- Customers – Finding and talking to customers to get their point of view.
- Team building – Figuring out who we needed to attract to the team.
- Investors – Researching and reaching out to the right investors.
- Competition and technology trends – Keeping an eye on the competition and other emerging technology trends.
Rui: Were you getting any sleep?
Jags: Yes, I was always calm and collected. When you’re centred and balanced, you don’t worry about other things. I focus on what I can control and don’t waste energy on things beyond my control.
Rui: How did you balance this with your personal life?
Jags: There were times, back then, we were still going into an office. I had an office space in Menlo Park, so I’d go in, get things done, and when I came home, I’d spend three or four hours with the family. Before bed, I’d hop back on my iPad to review things.
For me, it’s never been about work-life balance—it’s about an integrated life. You’re one person; you can’t separate these things. When something is a priority, you take care of that priority.
Additional Advice for Early-Stage Startup Founders
Rui: Let’s transition to the rapid-fire questions section. These are quick questions with quick answers.
Can you share one key lesson you’ve learned about product throughout your journey with Latent AI?
Jags: Some things take time – and that’s okay.
Rui: Can you share one key lesson you’ve learned about marketing?
Jags: Content is king and you need to build it from day one.
Put your point of view out there, start blogging, and get your SEO index going. You can’t spend two years building a product and then decide to start creating content—you’ve already lost those two years.
Rui: Can you share one key lesson you’ve learned about managing people?
Jags: Repetition of information—even at the senior level. You might think telling senior execs something once is enough, but it’s not. You have to repeat the message over and over again.
Rui: What about one key lesson you’ve learned about creating and maintaining culture?
Jags: Live it. As a founder, culture isn’t a document in a startup—it’s how you live your life.
For me, that’s meant being transparent. I’m very open when sharing information with the team, and I expect the same from them.
Also, teamwork. Teamwork is dreamwork.
Rui: Can you share one resource that was invaluable to your success?
Jags: My wife has been an instrumental part of my success. I know nobody else can access that, but having a supportive partner who’s bought into your vision and stands behind you can make a huge difference in your journey.
Thank you, Jags…
…for taking the time to sit down with me.
Jags’ journey with Latent AI highlights that true disruption isn’t just about technology—it’s about identifying untapped potential and rethinking industry fundamentals.
For founders, especially in AI, the challenge is not just to innovate but to redefine the future in ways others haven’t imagined. Those who embrace this bold mindset will lead the next wave of transformative disruption.
Whether you’re in AI or another field, remember: that disruption comes from envisioning—and building—a future that reshapes how we engage with technology and the world around us.
Thanks for reading.
