10: How Amit Garg co-founded an AI-first seed fund before AI took off

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First Funders

Shaherose Charania and Aamir Virani

22 episodes

1 month ago

Learn from angel and seed investors bold enough to write the first check. How do they decide which startups to invest in? How do they gain conviction in founders and ideas? How do they add value to their companies? Shaherose Charania and Aamir Virani are operators turned investors. They chat with their friends investing in early-stage technology startups and learn about their strategies to fund the best founders and startup companies. If you are an angel investor or seed investor, you'll hear how others operate. If you are a startup entrepreneur, you'll hear how investors filter and decide on writing that first check.

All content for First Funders is the property of Shaherose Charania and Aamir Virani and is served directly from their servers with no modification, redirects, or rehosting. The podcast is not affiliated with or endorsed by Podjoint in any way.

Investing

Business,

Entrepreneurship

10: How Amit Garg co-founded an AI-first seed fund before AI took off

First Funders

1 hour 11 minutes

1 year ago

10: How Amit Garg co-founded an AI-first seed fund before AI took off

Armed with an educational background in computer science and biomedical informatics, Amit Garg switched to venture capital after a long, successful career in the corporate world, which included stints at companies like Google and Samsung.

And that’s just the way he never planned it.

That’s right, the almost-doctor didn’t intend to get into venture capital, and he certainly never planned on starting his own fund. He was drawn in by his innate need to build things, including relationships with people. He partnered up with his officemate from Norwest, Sanjay Rao, and the two started Tau Ventures in 2019, an AI-first, early-stage fund focused on healthcare, enterprise, and automation.

Amit tells us about his very targeted approach to investing, which is different from the “spray and pray” method we’ve seen from friends of the pod and other investors in general. We also get to hear first-hand accounts about the importance of building trust with your investing partners and your founders. Plus, Amit gives us his take on the state of healthcare and AI and why – despite all the challenges – he’s hopeful about where it’s headed.

Amit primarily invests $500K in Seed-stage healthcare, enterprise, and automation startups and occasionally in Series A, B, and C through Tau Ventures.

Highlights:

Amit turned down a spot in medical school and pivoted his original ambition to become a doctor by first joining Google, pivoting to VC, and then becoming a digital health founder.
He got into the corporate side of venture capital after business school, but he never had any interest in starting his own fund. That is until his friend and former officemate convinced him that an AI-first venture fund was a great idea in 2019.
Amit explains that the “why” behind his investing does come from a place of self-interest – which is much different than selfish. He feels that when he pursues and realizes his own self-interests, he can help others to the same.
Why a founder shut down a company in his portfolio and why Amit decided to back him again basically the next day.
How he sees the interplay between angel and institutional investors and why they’re both necessary
Amit’s frustration with healthcare and how it fuels his passion to make it better. Plus, he explains why he keeps his focus on the three legs of the healthcare tripod.

(00:00) - FIFU 11 - Amit
(02:30) - Amit’s journey into venture
(06:08) - Why Amit likes venture capital as someone who wants to make the world better
(13:01) - Memorable moments from the first conviction-driven investment: Iterative Health
(19:18) - The machine gun vs. the shotgun style of investing
(21:05) - Lessons from the worst investment
(24:34) - Be careful who you partner with, optimize for good investors
(28:22) - What the best investment with a $450M exit taught Amit
(32:57) - Investing is about humans believing in humans
(35:42) - The state of healthcare and AI today
(46:39) - Venture vs. angels in the healthcare space
(51:12) - Outcomes in the digital healthcare space are starting to behave like tradtional SAAS software outcomes
(58:13) - Lighting round
(01:01:51) - Takeaways