What if a $1,000/month cloud setup could come down to just $20?

The first thing you eliminate is the time it takes to go from 0 to 1.

So you're estimating $1,000 per month turning to $20 per month.

Absolutely. We've done this for a customer already. That's the reason I put that here.

Where I was in high school, Bangalore had not seen any of this development. So houses were like this, people walking on the streets. After my high school, I went to the US. I went to the University of Chicago, spent 13 years in New York with an investment bank, Credit Suisse, doing mergers and acquisitions advisory. Came back in 2012, back to Bangalore, started a real estate development company. That's how I met Arun, Shrawan, and Mukund.

Mine's very different. I grew up, I would say, in Bangalore, but outside Bangalore, in a very rural place. I was doing my PhD in France in machine learning. I quit that in between to come back to India because I had 2 cousins, Shrawan and Mukund, who are other co-founders of ToyStack. We decided, let's do a startup together now.

So, you know, I'd say there's 2 aspects of being an entrepreneur. I think one is you get a lot more control over your life while you have all the risk, a lot of tough decisions. You also have a lot of control over your timings, your time, your life, etc. Until you actually scratch that itch, you don't know how hard it is. I think people thought I was a bit crazy, but I think everybody has their— has to make their own decisions for themselves, right? You can't live somebody else's life.

I think for me it was inevitable. My dad's an entrepreneur. He's an aerospace engineer with— he has patents in biotech. Even when we were kids, me, Shyaman Mukund, we played games together and we always thought, okay, we should do something together, you know. We got to just build stuff. Like, I don't know a life other than that.

Success is personal. So I looked around my investment banking colleagues, fancy apartments, fancy cars, but they were miserable personally. It looks sexy from the outside, but it's a very selfish existence, I would say. The one thing I didn't like about it is as you come up and become a managing director, there's only that much food that's on the table, right? There's that many clients, there's that many deals. So there's a— you start seeing a bit of, you know, people cutting you away. And I said, you know, let me try something else. The way Mukund, Shravan, Arun have really built this product, they've actually created something incredible in such a short period of time.

It was always, you know, this really cool tool that allows you to take away the complexity of the cloud. That's the reason we called it ToyStack. We thought it'd be a toy and we never actually Thought of this as a replacement for a cloud when we started out. It wasn't such an ambitious goal to begin with at the start. We were just building this for ourselves. It just started to look like we built something of value for these people because instead of going to everybody else, they started coming to ToyStack instead.

The cool thing with all of us is we're very close-knit with our families. Arun just got married. I got married 10 years ago, so I got 2 little kids. My parents are also close by. Everybody brings a completely different Skill set to the table.

Slightly nervous. We never competed with so many startups before.

I think every situation there is some sort of adrenaline, which is nervousness. It was positive nervousness.

So the team has three accomplished engineers who've built AI and ML applications at scale. I'm an ex-investment banker from New York, complementing their technical expertise. Anybody deploying on AWS needs an expensive DevOps team. It takes days to weeks of configuration, and your cloud bill is quite obscene. With ToyStack. That entire tooling is automated into a couple of clicks. You connect your application code to our platform, and in minutes you're on the cloud.

So when I go to AWS, the cognitive load is on me. I've got to decide what is the size of the computer I want, what is the storage I want, etc. But the problem is I'm always optimistic. I'm going to think, okay, next month I'm going to get 100,000 users, so I'm going to get the biggest system there is, right? It's going to be very expensive. So what we've done is basically said, okay, cool, just give us your app. We'll figure out a way to scale it up. Tomorrow you have 10,000 users, we'll figure it out. If it needs to come down, we'll do it. The only reason you wouldn't go to a data center tomorrow is because there is no API, there is no tooling for that. So what we've done is, A, built the tooling for connecting to these microclouds. Second thing what we've done is we've figured out what is the right technology to scale up and down.

Your main customers are going to be small and medium-sized businesses.

At this point in time, yes.

And you're going to say, hey, it's easier, get on, it'll end up being cheaper.

Way cheaper. It'll be way cheaper for them.

Like by Half or two-thirds?

There are 3 cost components. One is engineers.

Tim has this ability to focus on a topic and then take you off, and if you're caught up and a bit nervous, you tend to— so we, we were keen to kind of just keep the discussion on track.

Even if you get AWS tomorrow, you need to hire these DevOps engineers who configure AWS for you, right? You eliminate those engineers, A. The second thing you eliminate is the time it takes to go from 0 to 1.

What does it cost you to Deliver something that's $20 a month.

So we— it'll cost us roughly about $15 for this right now.

Well, that's not a very big margin.

It is not.

25%.

If you got that much room between $1,000 a month and $20 a month.

At the end of the day, the hook is the fact that we can make it simple for you, but then pick this, pick that, and then slightly gets expensive, but it'll never go to the range of an AWS.

Would you use them?

I mean, that's what— that's what I would like to understand. Like, do your best customers eventually don't need you because they grow big and then they can do it this—

No, so I've— we scale to any level.

But when you get bored, what are you gonna do?

We don't get bored.

We have 10 other products that we've come up with based on the same deployment.

This is an ocean. The cloud is an ocean. Uh, there's so many interesting things to do. We have so many interesting AI problems within this that we've solved already.

And the last company didn't have that much interest for you?

No. So basically that company was an AI healthcare company. Basically what we did was we developed these AI models.

It's doing phenomenally well, but now it's basically a copy How big does this become and how do you all stay like ahead of the tech as well?

We started off with a product-led growth motion, spent very little money on digital ads. We got 9,000 users.

3,000 in a month though. We went viral because somebody just made a video about us.

So that's 9,000 people paying $20 a month?

No, no, this was on the free plan, right?

Oh, free.

So simple that somebody who knows nothing about technology Right, can use these tools and we're facilitating the deployment to the cloud.

Well, great.

This is going to be huge.

Huge. Very nice to meet you.

Super excited.

It was, it was fun.

We expected a lot of tough questions. We got a few, so it was fun.

As a software developer, there's a learning curve involved in the first time.

Right.

But the second time you're leveraging the work you did the first time and—

Oh, so you only have to do it one time. Maybe it's just that one-time cost and after that, it's cheap.

So I think this is going to require a deeper dive into the product and tech.

Ali, what'd you think?

They're basically saying, we'll whittle down the price from what this space is because, I mean, you don't have to buy all that extra.

We'll go up and down with how much you use.

I don't know what I'd use it for, but I would buy it.

And the crystal ball, as small as it is, it's a big energy source. Bachwald is doing pretty much the same one thing as Trudy number 2, but you're focused more on cosmetics. Tell me why you are better than she is.

Um, first of all, there's enough plastic in the world to give us all an opportunity. On a very scientific, technical level, the kind of molecules that Terra manufactures and the kind of molecules that Backcourt manufactures are completely different. Their use cases are completely different. While she's targeting the— exactly what she explained, what we're targeting is more of Things that can mimic what already exists in plastic.

You out in TV land, send your vibes to the crystal ball or go to Draper TV and vote. They could end up getting a million-dollar investment from us, but it's gonna be from me.

But—

What? But the other venture capitalists are welcome to participate. So will it be BackAult? Will it be Terra Bioware? Will it be Flow Mobility? Will it be ToyStack? I'm starting to get a vibe. You guys getting a vibe? Maybe we need everybody's hands in here. All of you, hands in.

Mmm.

I think I've been meditating too long. Oh, we have a conflict. Oh no, ToyStack. And Terra BioWare. Congratulations! Good job, good job, good job, good job.

I went in thinking it's a 50/50 chance, but then it truly was a 50/50 chance. That didn't matter to us. It was nice that we just won and went.

Develop some kind of affinity with your fellow co-founders. You guys are trying to accomplish the same thing, so we were happy there was 2.

We really liked ToyStack as well. I also wanted them to win because it's a very sweet team.