Rahul Taneja

Belief is irresistible

[Rahul Taneja @rahultaneja]

@os7borne Wtf.. I just experienced this at a doc myself. I felt this is maybe more about “I’m going to record everything I say so I have a copy just in case I’m sued”

[Rahul Taneja @rahultaneja]

If anything, I think serendipity and IRL matters even more today than in the last few years. Every VC can read data signals as well as others now - intelligence is commoditised. Now it really matters who is the one with genuine taste and empathy

[Rajesh Sawhney 🇮🇳 @rajeshsawhney]

AI First VC Firms

VC firms will be leaner and meaner….AI agents will scout, analyse, do first meetings and do the diligence.

Decision making will be human with partners in the loop (for now)

Death of Serendipity.

Yesterday at @gsf_fund event in Gurugram @rahultaneja

[Rahul Taneja @rahultaneja]

@chandrarsrikant mask is an anagram of scam... makes as much sense as ETH price on any given day

[Rahul Taneja @rahultaneja]

@pHequals7 Babel

[Rahul Taneja @rahultaneja]

Captain Obvious

Every day, posts obvious gyan on AI/interest rates/macro and things like 'I'm an India optimist'. You could literally skip their post and not miss anything.

And yet, they continue to post, every single day.

I've never understood them but 🫡 for the efforts!

[Lightspeed India @LightspeedIndia]

Coming soon.

[Rahul Taneja @rahultaneja]

@das_think @tchirag Dingi you don't need to quote sources for your conclusions. As an ex consultant, you are like Ramanujan

[Lightspeed India @LightspeedIndia]

Most of India's consumer products were designed for its top 10%. The next 300 million are the users they have never reached.

They have long been viewed as a market with limited spending power. Lightspeed Partner Rahul Taneja (@rahultaneja) writes that this is likely the wrong diagnosis, and that they have been too expensive to serve. The cost of serving them is now falling fast. With AI, a founder can build a very different kind of team and infrastructure, and reach them at a fraction of the old cost.

His write-up, adapted from his recent consumer track session at the Google for Startups x Lightspeed Sprint, looks at what that change makes possible, assumptions most platforms still make about their users, and the principles for building products native to Bharat.

Read here: https://t.co/tmL8brMxbe

[Rahul Taneja @rahultaneja]

@Adithpodhar WBC

[Rahul Taneja @rahultaneja]

@os7borne This image was clearly generated by AI ... no one wears a Patagonia in SG weather 😂

[Rahul Taneja @rahultaneja]

@RohanNayak2 🚀🚀🚀

[Rahul Taneja @rahultaneja]

🚀🚀🚀

[Rohan Nayak @RohanNayak2]

We grew from ~0 to $500M ARR, adding $250M last year alone while being EBITDA profitable.

1,300-word post on every growth tactic that worked for us:

1. What got us from 0-$400M ARR in the US works in every country.
2. Retention and Monetisation Hacks.
3. Localization > Translation.
4. Experiment with $1M internal seed checks.
5. Pivoting to only AI content production unlocked 100% ARR growth.

Pocket FM is like Netflix for audio-only dramas, with our own pool of one-person studios.

1. Acquisition Playbook for 0-$10M ARR in any country in 6 months

We run a 90 sec video trailer of an audio drama as an Ad and ask users to download the app if they're interested in the rest of the story.

Our core insight after spending >$100M on acquisition is: If the clickthrough rate (CTR) for an ad goes from 2% to 2.25%, our customer acquisition cost (CAC) decreases by ~ 30%.

We remodelled our system around this insight and built an AI-first 2.25% CTR ad manufacturing machine that works in every country.

For every new country, we take our hit shows -> use LLMs to extract and most intriguing moments -> Write a 5-min script combining all the best parts. The first 60 seconds has to have a hook every 5 seconds and needs to end with a crazy cliffhanger to force a download mid-scroll.

If a marketing video is not hitting our benchmarks (2.5% CTR and 55% 3-second through-play), a creative director gets involved to change the hook or cliffhanger to get the numbers there.

AI lets us make 1,000 Ads per show, and in total we do ~17.5k Ads per month. When a business creating scales from 1k to 10k Ads, the normal thing is for CAC to skyrocket. But with what I just shared, we 7-8x'd our User Acquisition budget without increasing our CAC materially.

It took us 8 months to figure this out, but then the timeline from 0-$10M in every country got shorter and shorter:

US revenue grew to $25M in 19 months. (US is now 78% of total)
Germany to 21M in 11 months.
France to $10M in 3 months.

2. Retention and Monetisation Hacks.

We knew we wanted to create an audio entertainment platform, but there was no standard format. For the first 2-3 years, we tried 10 different formats before landing on the winner.

After we got it right with audio drama (8-12min chapters, written for mobile fiction, serialized, episodes have strong hooks and end on cliffhangers), avg daily streaming time went from ~25mins to 150+.

Audio drama made us realize that Pocket FM was creating a whole new medium. There was no playbook for anything that we were doing. Everything had to be thought & built from scratch.
This is what we did for each major bullet:

- Monetization: Users have some free daily minutes to listen; then it's pay per episode. We also added the option for users to unlock episodes by watching ads, which is doing extremely well. Ads scaled from zero to a ~$90M run rate in 12 months.
- Engagement & production: You don't become obsessed with an app you open once a week. To have users engage daily, we make the next episode free every day. Also helps them build the habit.
- Discovery. Huge problem because people consuming Pocket FM enter the app, tap the show, and lock the screen. We fixed it by doing "playlists" of episodes. Once users's free minutes on a show are done, we ask users if they want to pay. If they say no, we play a new show, one where they haven't used their free mins. And we stitch episodes of different shows together that way, creating natural discovery.

3. Localization > translation.

78% of our revenue is still concentrated in the US. Localisation is fixing this: You might write a show for a Spanish audience where language, jokes, folklore, have a certain flavor; if you merely translate the show for, say, a Norwegian audience, that color is lost and hurts the show in the Norway. Listeners would relate more if the show was written by a Norwegian.

That's why, instead of translating, we localize shows to different regions. We use AI to take the spine of stories and adapt their whole cultural layer to the other country.

The results: a US show that was localized for a German audience had 50% higher retention than the translated version.

Localization + our user acquisition playbook led to:
- $10M+ ARR in France within 3 months
- $21M+ ARR in Germany within 11 months.

And this expands writers' addressable market.
We get messages of writers thrilled to have revenue coming from the US, India, EU, LatAm, without them doing much incremental work.

4. Experiment.

We give $1M checks to new internal initiatives, and the team has 12-18 months to prove their thesis. If they prove it, we double down.
This is how Pocket Saga came about, our AI video microdrama app. It's an AI video equivalent of Pocket FM. Same shows and structure, but as a vertical 2-min mobile video series.

We launched it two months ago and it's at ~$15M ARR.

Pocket's broader thesis is to help creators tell their stories to as many people as possible. Start with audio drama -> multiple languages or localize to diff countries -> microdrama -> more formats like movies, TV shows, and games.

Best of all is that writers get revenue streams not only from countries they wouldn't have tapped into, but also from formats they wouldn't have thought possible.

5. Pivoting to only AI content production unlocked 100% ARR growth.

In mid-2024, we pivoted to only AI content production.
Our growth took a very direct hit. Pocket was already at $200M ARR, growing 50% YoY, and we flatlined for a whole semester.

Six months later, the business exploded.

After the switch, we went from ~25k hours of content produced per year to over 2.5M hours, which are also higher quality. Because AI orchestrates the writing and more data is fed into it, more blockbusters come out.
Over 90 titles have $1M+ in lifetime earnings and 13 crossed $10M.

Quality control is done with LLM as a judge, and LLMs are quite tough.
Results are very encouraging:
- 12-month revenue retention went from 44% to 76%.
- In the past year, we added $250M in net new ARR.
__________________________________

Pocket Entertainment (Pocket FM + Pocket Saga) has become the largest AI entertainment platform.

We have the largest storytelling catalog with 770,000 titles, 550k creators, and 5.5B hours of playtime with minute by minute retention & engagement data. We are using all of this data to improve every aspect of our business.

Our Bet: In the next 3 years we will be able to produce Naruto-like series for $1000.

Netflix has to spend $17B to find 100 Blockbusters per year.
What happens when you can produce 1M high quality shows for $1B?

The streaming wars caused a $300B reallocation of market cap.
The AI entertainment wars may be a $1T+ reshuffling of market cap.

We are at a unique spot. Unlike other AI creator tools like Runway or Midjourney, we own both the supply and demand side of AI content.

We've attracted over 550,000 writers who are producing an annualized 2.5M hours of content every year. This pairs with 137B+ minutes streamed.

Because of this, growth is accelerating as we scale further.
We have multiple S-curves inflecting at the same time:

- AI produces better and more ads -> scale faster in new countries
- ⁠Writers + AI produce more shows -> more blockbusters
- ⁠Localisation -> more reach per blockbuster
- ⁠Audio to video format expansion -> larger TAM -> more creators

Every aspect of our business is designed to improve another, and everything is aligned so that the number of blockbusters continues to rise.

If you're interested in building at the intersection of ai, tech and entertainment, DM me.

[Rahul Taneja @rahultaneja]

VCs to Cognition

[Colton Cray @thisccray]

couldn’t get any Tier 1 investors @cognition?

[Rahul Taneja @rahultaneja]

TIL the founder of the facebook is also the founder of openai

[DiscussingFilm @DiscussingFilm]

First trailer for Luca Guadagnino's ‘ARTIFICIAL’, starring Andrew Garfield as Sam Altman.

The film follows the story involving OpenAI focused on the firing & rehiring of CEO Sam Altman.

In theaters on December 25.

[Rahul Taneja @rahultaneja]

@ram_desh @theunsaif 🙄

[Rahul Taneja @rahultaneja]

ZIRP era investors and founders will write 300 page memoirs on their brilliant strategy and forget to put in the footnote about zero interest rates.

[Rahul Taneja @rahultaneja]

@vaibhavbetter @signulll

[Rahul Taneja @rahultaneja]

@theunsaif Laut aao Masa San...

[Rahul Taneja @rahultaneja]

@RajeshB18566468 This does sound like the Rajesh I met at IIMB merely 25 years back :D How have you been man!

[Rahul Taneja @rahultaneja]

@theunsaif everyone knows what the mc in their name stands for

[Rahul Taneja @rahultaneja]

You hire an ex consultant, who hires the top consulting firm in the world and together they wipe out the #1 global sports brand in <5 years.
The surprising thing is that people are still surprised by this shit.

[The Kobeissi Letter @KobeissiLetter]

BREAKING: After falling -80% from its record high, Nike, $NKE, will be removed from the S&P 100 at the end of this month, ending a near 18-year run in the index.

The stock has now erased -$230 billion in market cap since its all time high.

A collapse for the history books.