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Built in India, sold only to North American enterprises: $20M of revenue from fewer than 50 customers at $350K average contract value, now $40M+ a year
reached roughly $20M with fewer than 50 customers at an average ACV of about $350K · growth path 0 → ~$2M → ~$7M → ~$18M over three years after going to market · founders personally sold the first $5M with no sales rep · $300K first check at a $3M valuation, then an $8M seed at $25M post, then SoftBank at close to a $1B valuation · 300+ people in India
They wrote the Y Combinator application on the flight back to the US, filmed the video from the last two seats on the plane, and submitted with 22 minutes left — and what got them in was that two founders had gone and sat with call-centre agents in the Philippines, which nobody at YC had heard of anyone doing.
Fewer bars = easier, cheaper, or faster for an AI-assisted solo builder. Editorial judgments based on the case details.
Sharath Narayana's first company, Happy Fe, started in 2012 and did not do well; he ended up acqui-hired into Practo, which he calls "a glorified way of salvaging yourself." The formative experience came next. In February 2016 he joined friends at a company called Unboxed, which had built an on-site search product in India and wanted to enter the US. He took it there. The numbers from that 18 months are the origin of everything that followed. In India, their largest contract was $62,000. In the US, targeting retailers from the Internet Retailer Top 500 at rank 250 and above, their first deal was $180,000 on a sub-90-day sales cycle. "They're like, we've not seen a site search product which is so complete." Between February 2016 and August 2017 they went from under half a million in revenue in India to over $6 million in the US — roughly 12x in under 18 months, with two people in the US and Narayana flying over on a B1 visa every quarter for 30-45 days at a time. His conclusion: any product above $50K ACV takes three to six months to sell anywhere, so given identical effort, US enterprise deals return several times more than Indian ones. "Indian customers are value-based customers" — good customers, but the same effort goes three or four times further in the US. In August 2017 he met Swapnil Jain, an early Twitter employee, and Akash, who were on their third pivot. The name Observe came from an observability tool idea. They looked at building a sales-intelligence product against Gong, then Narayana pointed at a different market entirely, and the company incorporated around his birthday that August. He joined full time in January 2018. The path from there: a $300K first check, YC W18, twelve months of building, market entry in March 2019, then 0 → ~$2M → ~$7M → ~$18M, SoftBank at close to a $1B valuation, and $40M+ annual revenue today.
Six months of outreach came before a line of product. Narayana and Swapnil Jain messaged contact-centre leaders in India and the Philippines, mostly on LinkedIn, and pitched fifty enterprises on the problem alone; all fifty confirmed it.
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Data credibility: Founder interview on a venture fund's own podcast, with a disclosed two-way commercial relationship: the host is managing partner of Neon Fund, and Narayana states he is an investor in Neon and praises its distribution advantage on air. No dashboard, filing or third-party data appears; every figure is self-reported and unaudited. Self-reported figures for Observe.AI: $40M+ in annual revenue today; roughly $20M of revenue with fewer than 50 customers at an average ACV of about $350K; a growth path of 0 → ~$2M → ~$7M → ~$18M over three years after going to market in March 2019; the founders personally selling the first $5M with no sales rep; a $300K first check at a $3M valuation from an angel (the name is rendered as 'anur' in the captions and we have not guessed at it) who committed $600K in two tranches; an $8M seed at $25M post, described as the largest seed round out of that YC batch's investment committee, led by Nexus; SoftBank investing at close to a $1B valuation; and 300+ people in India. From his earlier work at Unboxed: a largest Indian contract of $62,000 versus a first US deal of $180,000 on a sub-90-day sales cycle, and growth from under $0.5M of revenue in India to over $6M in the US between February 2016 and August 2017. The $40M+ figure and the sub-50-customer/$350K-ACV combination are stated at different points and may refer to different dates; we have not merged them. Several proper nouns are garbled by the auto-captions — the first angel ('anur'), his first company ('happy Fe'), Practo ('prao'), and one company name rendered as 'arami' — and we have either flagged or omitted them rather than guessing. Region is India: the company builds in India with 300+ people there, both technical cofounders came out of IIT Delhi networks, and the founder repeatedly states the bet as 'we'll always build the software in India and we'll market it in the US market'; note that the company simultaneously presents as a San Francisco startup for sales purposes, by his own account, and Narayana himself is US-based.
The first contract was six figures and was signed before the product existed. During Y Combinator they landed a $100,000 customer who agreed to serve as their product partner through the build, which is what a design-partner arrangement looks like when it is priced properly rather than given away.
Market entry was March 2019, and the three years after it ran 0 to roughly $2 million, then about $7 million, then about $18 million. Three things did the compounding.
Twelve months of building with no revenue, after an $8 million seed had already landed. Market entry did not come until March 2019, and Narayana names the underestimate as his own repeated error: "we always thought Building Product would be much more simpler."
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