Phoenix-based qBotica, a startup company that makes software to assist with document processing, recently raised $1 million in a seed round after running the company without outside capital for years.
These days it is commonplace, even standard, for startup companies to seek outside investors before making money. These companies, often called pre-revenue, have an idea but need capital to make it happen.
Mahesh Vinayagam founded qBotica in 2017 and decided to buck the startup trend, instead opting to build the company up by securing revenue first. That plan worked for years, until the Covid-19 pandemic when some projects got cancelled and money got tighter.
“I have to be Roman in Rome, right?” he said of finally raising capital. “This is me falling in line.”
The capital infusion came from Peacock Ventures, a micro venture capital firm based in Tysons Corner, Virginia, and Vinayagam said the funding will give the company greater flexibility to operate.
“It's going to give me the freedom to grow further, it gives my employees the freedom to think beyond so we don't have to be constrained by our abilities to sell, rather by our abilities to think and imagine,” he said.
qBotica is already making millions in annual revenue with its business-to-business robotic process automation (RPA) software tools. The company has previously worked with clients in the Fortune 500.
Vinayagam said RPA software “mimics human actions” done on a computer, such as typing on a keyboard or clicking a mouse. qBotica has two main products, Disqover and DoqumentAI, which help companies understand how humans input data from documents and then actually do the data processing, respectively.
The company now employs 30 people in the U.S., another 25 or 30 in India (where Vinayagam was born) and between interns and contractors the company typically employs between 80 and 100 people. The new funding will be used, in part, to hire more people.
Vinayagam is a first-time entrepreneur; he started qBotica after spending 20 years at Syntel. His work at Syntel took him from India to the United Kingdom and then, in 2007, to Arizona where he has been ever since.
Vinayagam also serves as a mentor at Phoenix-based Seed Spot’s startup accelerator, where he said his top piece of advice is simple: Find customers.
“Go acquire a customer. Forget about building the perfect product, raising that fund, don't keep spending your time on pitch contests,” he said. “That kind of stuff is great, I don't want to go against that, but there's a lot of precious time, energy and focus of the startup entrepreneurs being wasted by going into things that don’t matter, so I actually mentor them to go and get the customer.”
