ET BureauBENGALURU: Earlier this month, when big data company Splunk bought security software provider Caspida for $190 million (Rs 1,200 crore), it was another feather in the cap for a little-known Indian-origin entrepreneur who has made a habit of building and selling high-technology startups in Silicon Valley.
For Muddu Sudhakar, 47, the sale of Caspida, which uses machine learning tools to identify security threats faced by companies from within and without, was the fourth such deal.Since 2003, some of the world's biggest software companies have bought startups he founded for a cumulative value of over $800 million.
In the highly competitive enterprise software space, Sudhakar has been finding sweet spots with the help of backers including Google chairman Eric Schmidt, as well as Ram Shriram and Sun Microsystems co-founder Andy Bechtolsheim who were the earliest investors in Google. in Google.
More important, Sudhakar seems to have perfected the art of building hot startups that are pursued by the world's biggest software companies. Having the right advisers and board members is essential to building valuable startups, Sudhakar said in an interview.
“I have had plenty of failures myself, but I had the right board of directors who ensured we kept learning from the mistakes,“ he said.
“They offered course corrections and guidance on markets, products, architecture,“ he added.
In 2003, Sudhakar sold his first startup Sanera Systems to McData for around $83 million; his second one Kazeon, to computer storage vendor EMC in 2009, and Cetas to VMware in 2012. Sudhakar's entrepreneurial journey offers valuable lessons in building startups in the enterprise software space where it's not enough having a large war chest of funding. Disruptive changes in technologies ensure that only the most innovative products solving real enterprise problems survive and win.
So how did he manage to keep building enterprise startups that attracted the world's biggest software companies across the hype cycles, technology shifts and bubbles? “You never want to build something to sell out; I never did.It just happened that these companies (acquirers) were looking for the same kind of solutions and ideas that we had,“ he said.
Over years, he says he has learned from his mistakes and is able to build a new startup after spotting an idea. “I do things I enjoy the most--as an operator or as a builder. I enjoy taking companies form zero revenues to $100 million plus revenues,“ said Sudhakar, who was born in Kakinada in Andhra Pradesh and educated at IIT-Madras, graduating in electronics and communication.
He completed a masters' degree in computer engineering at Yale University and obtained a PhD in computer science from the University of California.
“I always hire people who can compensate for what I don't have (in terms of ability and knowledge),“ he said. “For me, the key learning has been to hire a team player, and choose him over an individual rock star--that's the one thing I have learned over years.“
Having a strong sales person who can understand what customers really want, is another key learning in building multiple successful startups.
“Customers will give you all the information, but they don't know what they want--so you need somebody who can do that.“
Shriram, managing partner at Sherpalo Ventures and Google's founding board member, said Sudhakar's ability to identify the market need and build great teams sets him apart.
“Sudhakar was able to identify the market need for a machine learning and data science driven approach to Insider threats and cyber-attacks. Within 18 months, Muddu built a great team of data science, big data and security researchers, and under his leadership Caspida has executed with focus to ship product and have numerous successful customer deployments,“ said Shriram.
Successful founders such as Sudhakar may not be seen as the quintessential Silicon Valley types who dream of changing the world and creating billion dollar unicorns, but they are always solving a real, enterprise problem. “They usually don't talk about changing the world or building billion-dollar firms. It is about solving a real and immediate problem in large enterprises. This is why they are not as well known as consumer-focused tech company founders,“ said Pari Natarajan, founder of enterprise research firm Zinnov.
More importantly , they also have a network of senior engineers and architects who usually follow them into the new startups. So, should startups be looking to build products with a potential exit in mind?
Shekhar Kirani, a partner at Accel India, said serial entrepreneurs such as Sudhakar should go after bigger problems after perfecting the model. “Once serial entrepreneurs make money and understand the rules of the game, the best thing to attempt is to go after really big problems that need a lot of money and impact on humanity is extraordinary; a bit of Elon Musk style.“
For Muddu Sudhakar, 47, the sale of Caspida, which uses machine learning tools to identify security threats faced by companies from within and without, was the fourth such deal.Since 2003, some of the world's biggest software companies have bought startups he founded for a cumulative value of over $800 million.
In the highly competitive enterprise software space, Sudhakar has been finding sweet spots with the help of backers including Google chairman Eric Schmidt, as well as Ram Shriram and Sun Microsystems co-founder Andy Bechtolsheim who were the earliest investors in Google. in Google.
More important, Sudhakar seems to have perfected the art of building hot startups that are pursued by the world's biggest software companies. Having the right advisers and board members is essential to building valuable startups, Sudhakar said in an interview.
“I have had plenty of failures myself, but I had the right board of directors who ensured we kept learning from the mistakes,“ he said.
“They offered course corrections and guidance on markets, products, architecture,“ he added.
In 2003, Sudhakar sold his first startup Sanera Systems to McData for around $83 million; his second one Kazeon, to computer storage vendor EMC in 2009, and Cetas to VMware in 2012. Sudhakar's entrepreneurial journey offers valuable lessons in building startups in the enterprise software space where it's not enough having a large war chest of funding. Disruptive changes in technologies ensure that only the most innovative products solving real enterprise problems survive and win.
So how did he manage to keep building enterprise startups that attracted the world's biggest software companies across the hype cycles, technology shifts and bubbles? “You never want to build something to sell out; I never did.It just happened that these companies (acquirers) were looking for the same kind of solutions and ideas that we had,“ he said.
Over years, he says he has learned from his mistakes and is able to build a new startup after spotting an idea. “I do things I enjoy the most--as an operator or as a builder. I enjoy taking companies form zero revenues to $100 million plus revenues,“ said Sudhakar, who was born in Kakinada in Andhra Pradesh and educated at IIT-Madras, graduating in electronics and communication.
He completed a masters' degree in computer engineering at Yale University and obtained a PhD in computer science from the University of California.
“I always hire people who can compensate for what I don't have (in terms of ability and knowledge),“ he said. “For me, the key learning has been to hire a team player, and choose him over an individual rock star--that's the one thing I have learned over years.“
Having a strong sales person who can understand what customers really want, is another key learning in building multiple successful startups.
“Customers will give you all the information, but they don't know what they want--so you need somebody who can do that.“
Shriram, managing partner at Sherpalo Ventures and Google's founding board member, said Sudhakar's ability to identify the market need and build great teams sets him apart.
“Sudhakar was able to identify the market need for a machine learning and data science driven approach to Insider threats and cyber-attacks. Within 18 months, Muddu built a great team of data science, big data and security researchers, and under his leadership Caspida has executed with focus to ship product and have numerous successful customer deployments,“ said Shriram.
Successful founders such as Sudhakar may not be seen as the quintessential Silicon Valley types who dream of changing the world and creating billion dollar unicorns, but they are always solving a real, enterprise problem. “They usually don't talk about changing the world or building billion-dollar firms. It is about solving a real and immediate problem in large enterprises. This is why they are not as well known as consumer-focused tech company founders,“ said Pari Natarajan, founder of enterprise research firm Zinnov.
More importantly , they also have a network of senior engineers and architects who usually follow them into the new startups. So, should startups be looking to build products with a potential exit in mind?
Shekhar Kirani, a partner at Accel India, said serial entrepreneurs such as Sudhakar should go after bigger problems after perfecting the model. “Once serial entrepreneurs make money and understand the rules of the game, the best thing to attempt is to go after really big problems that need a lot of money and impact on humanity is extraordinary; a bit of Elon Musk style.“
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