Tanay Pratap, CEO of Invact Metaversity
Tanay Pratap, founder and CEO of Invact Metaversity, better known as Tanay bhaiya to his students, is rebuilding edtech Invact to make the virtual university more accessible with a focus on education and on youngsters who are looking to move forward in their career.
From differences with cofounder Manish Maheshwari on its vision to failing to find a buyer, this less-than-a-year-old startup faced quite a storm even before starting its first batch of students. It ended after Maheshwari stepped down as chief executive and director.
Invact Metaversity raised $5 million in February, led by Arkam Ventures and other investors, valuing the startup at $33 million.
It offered a 16-week business studies programme which the company said was designed to get students a job “in a core business function of a high growth company.” One of the key differentiators was that students were expected to attend classes through virtual reality or the so-called metaverse.
In a chat with Moneycontrol, 31-year-old Pratap opens up about what happened, how important it is for cofounders to have a courtship, why one should not quit the mission and how Invact will focus on education and not the metaverse.
Edited excerpts:
There were reports around the different directions in vision. Take us through the vision.
Tanay Pratap: Wherever you are in life, you need upward mobility. You need mentorship, guidance – very structured mentorship, not just integrated mentorship. We started thinking about how to make education more effective while at the same time keeping it accessible.
Physical colleges are a great place to begin. But then it also becomes inaccessible because the fee is too high. And you also have limitations of numbers. You can only have 500,000 or 50,000 students. So when we started talking about more effective mediums of education, Covid made sure that people got their degrees completed. A few batches from really good MBA colleges never saw the campus. So that showed education can happen online as well. Even good discussions, hiring can happen online as well.
Metaverse is a more effective medium to learn because apart from the audio and the video, which we are used to, we also get that 3D layer or a spatial layer. But we were never selling metaverse city, we were selling effective education and the product. Your customer is coming to you for the education and not for the building. You don’t go to school for the building, you go to school for the education or the teachers, for jobs, all of those things. So that was where the mismatch was happening.
This is an edtech startup, not metaverse.
Typically, cofounders disagree on how to achieve an objective. But in Invact Metaversity’s case, the two cofounders disagreed on the vision itself within six months of the founding of the company. How was that possible?
Pratap: Why can’t the vision change in five or six months? People decide one day that they will start going to the gym and get six-pack abs in a couple of months. Then they stop two days later. It is in human nature that some things change. You are not the person that you were six months back. Also, I think a startup’s vision or mission is not etched in stone. For example, Slack did not start out as a messaging platform.
Things change. When that happens, you need to reassess what has been done, understand whose vision the other stakeholders want to bet on, and move on. That’s what we have done.You are still quite at an early stage and so much has happened already. Could it have been avoided? What impact do you see, especially on hiring?
Pratap: I keep saying this to a lot of people that hindsight it's always 6/6 and 20/20. When you’re getting into it, you don’t know, things will go this way or that way. So obviously, things could have been better. Not gonna point fingers or not gonna say anything, but could it be done better? Obviously, it could have been, but whatever happened, I would say the best outcome was for education. As long as the mission gets to stay alive, I am happy, I’m thankful to the universe, we get to live and fight another day.
Yes, hiring is a problem for early, like seed-stage companies. But we have retained all of the people who we wanted. So we are set for the next few months at least. And when we have to grow, we will show the world what we are built of. And also I mean – I’m being very rash here – that if one setback is putting you off from joining a startup, I think you’re not great. Because startups have setbacks. Startups have this all the time. So if you’re there for the drive, come join us, but right now, for the next 3-6 months, we are not hiring. We want to win and keep the team lean.
Currently, we have a 15+ team – in design, product and also operations and admissions and curriculum.
When is the next course starting? Any timeline or changes in the contours of the course?
Pratap: Whatever happened has happened with Invact 1.0 and now we are building 2.0 and some major version of it. Not all the changes are on the table yet – it’s day five of me being CEO. But yes, everything is on the table that we can revisit, we can learn from whatever bugs we have… you have bugs, fix the bugs, release the new versions, and see whether customers or users are loving it or not, take the feedback again, fix the bugs, release again.
In about 8-12 weeks, we’ll get started with the course again. This will be leaner, less heavier on MBA, which we wanted to cover, and focus more on employment with more accessibility. When we started, the idea was always to be more and more accessible to people. And by accessibility, I mean price differences... if it’s say Rs 40,000, it becomes easier for them to get upward mobility. So these are the things which we are considering right now, the timelines of the batch, but also coming up with a free primer course where you want to come in and see what we are offering.
We clearly say we are not a degree-granting institution, we are not a certificate institution. There is a page which says when you should not choose us. What we believe in is that your work should become your degree, your craft should become your credentials. And we want to give that taste to a lot of people. So the first batch which was cancelled, I took that batch in and some of the teachers are still teaching that batch and they are creating this craft. So they are getting the hang of it.
To make this more accessible, we want to do maybe a free layer, cheaper layer, more accessible layer and then still accessible layer for the specialisation. So maybe divide the whole course into three pieces and then deliver in chunks rather than getting people into a four-month fulltime course.
The first batch was cancelled, but you are still coaching them?
Pratap: At the end of the day, all the 70 folks trusted me and came in because of the Tanay bhaiya thing and they said they don’t care about the money or other courses, but want me to guide them through this. So, in my personal capacity and as much as possible, I did. Now, I can guide them in a professional capacity and involve more teachers. This has been going on for the past 15 days, they have created 200-plus proofs of work already. So I’m also a lot recharged, seeing their energy.
At some point of time, you have to realise you have made mistakes and want to move on from those and fix what has happened. And that’s what we’re doing right now.
After the recent fiasco, what will be your advice to entrepreneurs like you who are starting up?
Pratap: A lot of advice. What happens when you’re in a crisis, you will do a lot of introspection, realise what went wrong, why, what happened. So the advice would be: be very, very cautious who you choose as your cofounder and see that there is mission alignment and spend time together.
Second piece of advice would be: No matter what happens, if you believe in the mission, don’t quit the mission. And there were times when a lot of people told me I might as well do something else. This is going to be too hard…
I don't see myself doing anything else in the next 10 years. I left my job to do edtech, I'm going to do edtech, might as well do it here.
My mentor also told me that as long as you're solving customer problems, nobody cares. Nobody cares - the media or VC ecosystem. All you have to think about is: can you solve the customer problem? Do you have that in you? And if you have that in you, yes, there will be bad times, there will be setbacks, but at the end of the day, that is what startup life is like.
Finding a cofounder has always been a problem, even in Silicon Valley. Even VCs give advice on who should be the cofounder. What’s your take?
Pratap: You need to spend more time before moving into serious relationships. The courtship period should be there. And it’s very much like dating – if you don’t date, then don't marry. So that's what it is. And, also don’t marry because the janampatri has matched…. The best thing is to have a courtship period, have a lot of dating, have fights and disagreements earlier into the relationship. And if you're not having that, might as not as well not move in. And the plan was not to move this fast anyway.
Some founder-investor conflicts in startups this year were more long-drawn out. Compared to those, the issues in Invact seemed to have been resolved quickly and smoothly. What went on behind the scenes?
Pratap: It was not smooth. I don’t want to lie to you or anyone else. This was not smooth. But it ended smoothly. I would say don’t confuse the end with the process.
You raised $5 million. Are you looking to raise more capital for the rebuilding now?
Pratap: We are not looking for more capital currently, although there has been some inbound interest since the news (of leadership change) broke. The company is much leaner than before and we have months and years of runway at present.
I think we have signs of early product-market fit (PMF). Even though we returned all our students’ money with interest and helped them polish their resumes after cancelling the course, they were still very dejected. This goes on to show that there is a demand for our product in the market. The Rs 1.5 crore revenue that we had got from onboarding those 70 students was not a small number for a three-month old startup. Until we can repeat that again and again to validate the PMF, it does not make sense to go out and raise more capital.
With the funding market for tech turning bearish, are you concerned that it is better to raise some money sooner rather than later?
Pratap: There’s a very wrong notion that there is no capital in the market. It is still available for those who have shown the ability to build a profitable business. Talking of runway, we can go on without revenue for 24 months. But we are looking to break even in the next 12 months and then take it from there. What I have learnt from my experience of the past few months is that capital does not solve your problems. It is just an enabler to think and experiment and we have enough money for that. Even the bigger startups realise now that all your problems do not get magically solved if you have raised $500 million.
Where does the metaverse fit into the company?
Pratap: Metaverse was never the core thing. That’s where the differences started appearing (between the cofounders). The three core pieces of our offering are 3Cs – community, curriculum and craft, which can lead to better employment opportunities for youngsters.
Talking about community, we do not want our students to get the feeling of learning alone, like it is on Coursera or other platforms. So, metaverse is one sub-head under the community bracket which would help foster the sense of a community. We still want to build that out, but it is not the heart and soul of what we are offering. We are not building a metaverse-city for people, but trying to solve an education-employment problem for the community.
There’s a lot of churn in edtech now. Where might things have gone wrong?
Pratap: I think edtech is stuck with a CAC (customer acquisition cost) problem. With a lot of capital coming in, companies built a very sales-driven model rather than focussing on tangible outcomes for students. Education is a leaner, long term game where you first build trust, word spreads over time and then more people come to you.
That is only possible when your goal is creating value for students, not hitting a valuation number. It is your choice which of the two you want to solve for.
To be sure, which of the two will you chase?
Pratap: I am here for the long term and I just got the chance to get out of it, but chose to come back. What I saw during my time at Microsoft was that you can grow exponentially over time if you build your business the right way – and if your employees and customers care about it.
There are a lot of lessons to learn from the way Satya Nadella (Microsoft CEO) has turned around the company since 2014. We used to say that empathy is his middle name. And I saw the change in thinking happening at every level.
What kind of courses are you planning to launch?
Pratap: We are still focussed on business education as it was before. What has changed is that the courses would be for shorter time spans and more cost-effective. There’s a lot of demand around four areas – product marketing, product management, finance and business analytics.
The price points still need to be decided before I can say anything concrete, but rest assured that they would be much more accessible than before. They would be much lower than price tags like Rs 1 lakh or Rs 2 lakh.
How do you see the metaverse panning out over the next few years?
Pratap: I think there will be a gradual adoption. It won’t be that next year you will suddenly see everything shifting to the metaverse. At present, there are a lot of hardware and network limitations that I am sure people will solve over time. Moore’s law will take care of some of it.From Invact’s point of view, we are building a product that can be accessible for everyone. For example, metaverse also has a spatial dimension, apart from video and audio. Just like on a video call, a person can choose to just carry on with their audio if the bandwidth is not strong enough, we also will see to it that our product has a lighter version so that it is accessible to anyone.
Exclusive: Metaverse is not our soul. That’s where the disagreements started: Tanay Pratap - Moneycontrol
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