The Entrepreneur Whose Intelligence is Anything But Artificial feat. Aruna Viswanathan '01

Show Notes

Aruna Viswanathan '01 joins host David Droogleever to discuss her pivot from engineering to tech investing and entrepreneurship, provide essential tips for beginner investors and talk about AlphaX Decision Sciences, the energy AI software company she co-founded.

A transcript of this episode is available here.

What is Owl Have You Know?

Owl Have You Know is Rice Business’ podcast created to share the experiences of alumni, faculty, students and other members of our business community – real stories of belonging, failing, rebounding and, ultimately, succeeding. During meaningful conversations, we dive deep into how each guest has built success through troubles and triumphs before, during and after they set foot in McNair Hall.

The Owl Have You Know Podcast is a production of Rice University Jones Graduate School of Business and is produced by University FM.

Speaker 1:
Today on Owl Have You Know.
Aruna Viswanathan:
We tend to see the world very binary, zeros and ones, right or wrong. And I think that, that's a [inaudible
00:00:21]. I think everybody has a lot of different talents. And I also think that there are a lot of different
perspectives in the world. People need to really use the skills that we learn in MBA school, the critical
thinking skills and put it to good use in society.
David Droogleever:
Welcome back to another episode of Owl Have You Know. This is your co-host, David Droogleever. And
on the line today, I have Aruna Viswanathan. She is a Rice Business class of 2001, a co-founder and chief
operating officer at AlphaX Decision Sciences. Does many other things, is very involved in the
community, is an investor and venture capital and a number of other things we'll go into. First and
foremost, Aruna, thank you for coming to the show.
Aruna Viswanathan:
Thanks for having me, David.
David Droogleever:
All right. Well, we have a lot to cover here. You seem to be a very multifaceted person and executive
and have done a lot of things since graduation. So perhaps we can start so we can get a better
understanding of who you are and what you're passionate about. Can you give us the highlight real bits
that led up to your decision to join and go through the Rice business program? And what are some of
those highlight moments that have brought you to this point here?
Aruna Viswanathan:
Yeah, absolutely. Be happy to talk about that. So I am an engineer by training. A lot of MBAs are. I
actually have a master's in electrical engineering, which I got from UT and I was one of those people that
pretty quickly realized that I was not going to survive that sort of hierarchical organizational work in
engineering firm. I was working for Motorola. I had worked for Advanced Micro Devices before that, and
it was pretty clear to me that this was not going to be the career path that I wanted to do. So I started to
look at the MBA programs as a way to kind of diversify and go into other areas that might be better
suited to my skills.
David Droogleever:
That makes two of us. When I was going through computer engineering at Georgia tech, I said, "Yeah, I'll
finish this. But these other people seem to be way more excited about this than me." So similarly, the
MBA allowed me also to diversify after engineering and military career, and it's all been gravy after that.
So since getting your MBA, how has that altered your trajectory and how did that affect where you
wanted to focus? What kind of businesses you wanted to work with, how your overall life trajectory
went? How did Rice business influence that direction?
Aruna Viswanathan:
Well, the reason I chose to go to Rice was actually because I was pivoting to move to Houston. And
when I started to look into that, I said that I needed to pick a school that would probably have the best
network for being in Houston. And I absolutely believe that it was the right choice. And in fact, I would
say that the Rice degree, since when I got my degree has kind of been like a fine wine. It has aged very
well over time and that's really to the credit of the administration, the school and the students that
came after me. We kind of joined in a strange time when the program was trying to pivot its
programming from I think one type of system to another. So we were kind of a guinea pig class where
we ended up taking classes, they had quarter system or something like that.
Aruna Viswanathan:
And so it was a really interesting period in the school's history. It was also the year that they started a
course around the technology entrepreneurship environment in Houston, which evolved into the Rice
Alliance. And so when I was there, I actually did this strategy course on the technical workforce in
Houston, got to learn really about the community of science and innovation in Houston, and ended up
parlaying that into an internship, which at the time I got connected through some Rice students, which
was at the Houston Technology Center, which was then a just starting incubator in the city.
Aruna Viswanathan:
And so it really was a pivotal moment in time with respect to the city and with respect to the school,
because as you can see, starting from that class, which I participated in the first, what was then called
Southwestern Business Plan Competition to what is now 20 years plus into the Rice Business Plan
Competition. It's been quite a big shift in the school's focus from just being mostly a finance school to
also being an entrepreneurship school. And I had the fortune to meet a lot of the people who were early
on the ground in that transition and be a part of that. So I've really been very grateful to the experience
at Rice.
David Droogleever:
Wow, that's a lot. I've had some touchpoints with either the Rice Alliance or Houston Angel Network,
which you didn't mention, but that's in the vicinity as well. And the Houston tech Center. In fact, I
haven't mentioned this on the show before, but my last semester in school, I did one class with the
Houston Angel Network. So that was one of my classes that I would actually go to the place where that
was at, HAN or Houston Angel Network. So that was, to me, one of the most rewarding things because I
was working and rubbing elbows with investors in the community, seeing pitches and pitch decks. That
was really rewarding.
Aruna Viswanathan:
The HAN organization was actually spun out of the Houston Technology Center right around the time I
was there. And I was on the board of HAN for a couple of years.
David Droogleever:
That's fascinating. I wonder if we walked by each other at some point. But that's really interesting, the
history there. So I learned something about that history there. So going back the two decades, are there
folks that you're still connected to that you went to Rice business with by chance?
Aruna Viswanathan:
Yeah, absolutely. We make friends for all kinds of different reasons, right. And the people who I've kept
in touch with over the years have really become very close friends of mine. So I've kept in touch with
some professors. One [inaudible 00:06:38] professor who was adjunct at the time is Scott Crist, who I
don't know if he teaches there anymore, but I ended up working with him in one of his venture funds
and work with him today. I also keep in touch with several of my classmates from Rice and they've gone
on to do amazing things internationally and all around the United States.
David Droogleever:
Excellent. That's a common theme that keeps coming up over and over is just the power of the network.
So the next chunky topic I'd like to ask you is more on the investing side of things and just looking
through your profile, you've done a lot of investments in various companies. How do you go about
thinking in terms of building out or optimizing a portfolio? What are some of the components that you
think of when it comes to selecting where you're going to invest, or which companies you're going to
put your time, energy and focus in, and to what level? Do you have a higher level guiding either
lighthouse or north star when it comes to making those highly complex decisions?
Aruna Viswanathan:
Yeah, because I'd probably start by saying that you learn a lot about yourself as you do different kinds of
investing. So I have people I know who are most happy working in very liquid markets like the stock
market. I have other people I know who are much happier in real estate, where they can manage
somewhat more predictable returns and risk. There are other people that even look at debt, prefer debt
versus equity. And then there is that strange and mysterious place, which people call venture capital and
angel investing, which is really the hardest and most difficult part of it. So my first recommendation to
anybody who's really looking to do that work is for them to understand that the money that they're
earmarking for this, they should assume that they will never see it again, because that is the best way to
go about doing it.
Aruna Viswanathan:
The second is to not put all your bets in one place, that you should definitely diversify it. And the third is
maybe that they should consider early stage investment vehicles or early stage venture funds and put
money into different of those, which then further diversify into their investments as well, because it's
very, very hard to diligence a deal. Every one of them is different. Every venture capital investment,
[inaudible 00:09:09] angel investment requires a massive amount of complexity for these businesses to
succeed and you can't watch and help them all day. So you really need to be able to step away from it
and diversify your risk across if you're going to do this kind of work. But as far as what I look for,
everybody's going to be different. You're going to be looking for characteristics of deals that you can
understand.
Aruna Viswanathan:
And that is probably the most important thing is pick the area that you feel most comfortable with and
stick to that, because that way you'll have a better confidence in what you're doing. And you'll also get
better returns potentially. People get very excited about things that they don't understand, but that's
not a good idea.
David Droogleever:
And now you're mostly focused on, is it AlphaX Decision Sciences that's taking up most of your time and
focus? What is it today that is getting most of your energy?
Aruna Viswanathan:
Yeah, absolutely. So AlphaX Decision Sciences is a company that we incubated and then launched in
2016 and it has been probably one of the greatest stories of my life has been to be working on this side.
As you stated, right out of MBA school, I worked with the Houston Technology Center for a number of
years and ran their operations. And so I got to work with helping lots of companies, helping them with
their business plans, helping with their presentations and really growing the community. From there, I
transitioned into a early stage venture capital and a mezz debt fund, which invested in companies. And
then I worked with the Emerging Technology Fund and a number of other investment groups investing
in businesses. But I've always wanted to circle back to not just consulting and helping or investing, but
doing the operations because in all the capacities I was in before, I was already doing operations or
jumping in and doing things anyway.
Aruna Viswanathan:
And so this was the first time to really come in at ground zero and do something that would be
challenging and really in a way, David, returning back to some of the engineering roots, right? Because
while I've worked in all kinds of ranges of different businesses, AlphaX is in fact a pure play AI data
driven company. And so we are focused on the upstream oil and gas sector, and we play at this
intersection of some very highly complex technical skills, which are AI, of course, artificial intelligence,
software development, cloud infrastructure, and subject matter expertise and energy.
Aruna Viswanathan:
And so putting these four disciplines together to build is a really very interesting task, especially when
it's done in a virtualized environment, through COVID, and an energy price crash. And now, as you can
see, a massive difference from two years ago with respect to where the energy trends are today. And
it'll continue to change because we're going to go through a transition and more and more solutions like
what we provide, that provide operational efficiency and help, I guess, facilitate the transition from the
Boomer generation to the Millennial and Gen Z generation to drive the future of energy.So it's been
great.
David Droogleever:
Interesting. I have so many questions about AlphaX. This is really neat stuff. And so staying zoomed out
in terms of just the fundamental value proposition or what challenges are being solved for by AlphaX,
how would you sort of package that up cogently, in terms of the challenges being solved for?
Aruna Viswanathan:
At the highest level I think what you have to look at is that the marketplace needs to be able to drive
more efficiency because we are in this situation where supply and demand for oil and gas, it's very
volatile. It was volatile before, but it continues to become volatile because we have increasing
populations. We have energy transition. We have geopolitical risk and all of these things occurring. And
as a result, and the fact that more generations of people are moving into sustainability or other types of
careers, you have the same people who are managing one set of assets, are now managing potentially
five to 10 times more assets, whether that's a well or systems or equipment. They have to do more with
less. And that is the dynamic which then brings data driven and AI solutions to the forefront for the
energy sector, which has not been a fast adopter of AI.
Aruna Viswanathan:
It's in fact, a lagging industry adopter, largely because unlike most other industries, the data has just
never been as organized as it was in other places. So that's the nature of it. Now we produce several
different solutions for subsurface. Some of them are in drilling and equipment, and those are on our
website. But we also produce a platform and a SaaS software that forecasts the production and provides
competitive analysis in near real time for unconventional oil and gas wells. And so the power of this is
that it's a game changer in being able to use AI to leverage public and private data and look at well, what
do I expect to be able to get from my resources in the future and how do I then best tailor and adjust
from there?
David Droogleever:
So when you interact with your customers and have these conversations, I would imagine high level it's
okay, who doesn't want to drive more efficiencies using data more skillfully? And the first time it came
up, as I heard you provide that description, is these huge companies have data just everywhere. And a
lot of times the data just falls on the floor. You have different teams that keep the data close to the
chest, don't want to share and put it all together. They operate in stovepipes, essentially data
stovepipes. Is that a challenge? I'm trying to think of what are specific challenges to essentially
operationalize and action out the value proposition? Is that one of the things that comes up, because in
my space, I see this everywhere. The data is there, it's just assimilating it and putting it together to make
it actionable is a core problem. But I don't want to make too many assumptions here. Does that come up
in conversation with your prospects and customers?
Aruna Viswanathan:
It comes down to company culture, right? So there are some companies where that is more of a
problem and some companies where that's less of a problem. And I think it's our job to be looking for
those companies that are the adopters, the fast movers, right. And then as more of these things get into
the market, then we can kind of pull on that success to bring in others. So it is very much, I think, that
we see that folks who are a little bit younger, a little bit more technology and data friendly, who are
used to using things in their daily lives do understand it more and can adopt faster. But I think that the
dynamics of COVID has changed a lot of this where people are now starting to say that we do need to be
able to pivot very fast. And so that has changed I think the dynamics of even people who may have been
more recalcitrant in the past to look at and try to understand where they should be going.
David Droogleever:
And how do you identify the folks? Is there a way to do an assessment of the lay of the land for
companies that can use the AlphaX solution? Is it come up in conversation? How do you identify those
folks that are change ready, or to your point have that culture that are more fast moving, much more
data friendly?
Aruna Viswanathan:
Every company is going to be so very different, right? What I would have to say to folks is that this
business of understanding what is the market, how you segment the market and actually, what is the
difference between marketing and sales and what works best in your industry is an experience to have
to go through. And I'm sure, David, you've definitely gone through it. I'm going through it. And every
entrepreneur who has tried to ever build a business and get out to the market has to go through it. And
it is very hard. It is the hardest. It may even be harder in some cases than building the product itself
because there's such an interplay if you don't understand these things, then you can have a great
solution, but you can't get it out there.
Aruna Viswanathan:
So I think that the way you have to do this, and I think that you had probably seen this before is you
have to do a lot of customer focus groups. You have to get in front of the people who you think are
buying your product, and you have to have lots of deep conversations with them to try to understand
their personas.
David Droogleever:
Excellent. I love that. I know that was loaded too, and this is all of course this ongoing figuring it out as
you're flying the plane, you're putting it together. So I promise I'm not trying to throw you any curve
balls [crosstalk 00:19:02].
Aruna Viswanathan:
No, that's Okay. No, it's all good. I have worked in operations across a lot of different businesses. I think
that this is sort of.. You kind of alluded to this, but I've worked in operations, but I also have worked on
the investing side. So I have some experience in entrepreneurship, in investing, in board and also on
boards. And so it's been very interesting to me to see that you can take things and experiences from
really old sectors like real estate, which I'm involved with in as well, localized real estate, and look at
how those models and contracts and things work. And then you can look at virtualized global business
like AlphaX, which is a wholly new business. But that's what I really enjoy is looking at these business
models, looking at how they work and evolve and having crossed enough of them over a period of time,
both myself and my own work, as well as investing in companies and learning what they do, that is I
think been the most rewarding and interesting part of the last 20 years.
David Droogleever:
That's a great segue. And I wanted to ask sort of how you take all the things you've learned and then
divest that out. But I have one more question on AlphaX. Going back to what still fascinates me is that
intersection of AI, software development, cloud. And then also, as you were saying, SME and the energy
sector. Of course you're learning as you're going, but then are there other folks or peers say that may
have done something similar or otherwise that you can go to, to glean knowledge from in order to figure
out that Rubiks cube a little bit more skillfully, or do you feel like you're unique in this space? I ask this
because in Houston, when it comes to... Houston's well known for energy, but when it's software
development, AI, that's something you think of maybe in Silicon Valley, for example. So I'm curious, who
do you go to for either help or for knowledge or for domain expertise as you're figuring out that
intersection?
Aruna Viswanathan:
Yeah, that's a really good question. So actually our CEO is out of Silicon Valley and Sammy, he used to
work for Baker Hughes and ran their Palo Alto innovation center. His background is deep in the AI area
over his career, having worked at several different companies putting together solutions. We have a
data science team that's also remote. They are a team of mathematicians. We have degrees in electrical
engineering, in math. I think there's another interesting aspect of this, which is that the kind of math
required to do artificial intelligence, machine learning for retail or banking or other types of sectors is
very different than energy. The energy sector has got such high level mathematics. If you think of
reservoir simulators or just subsurface, you have multiple dimensions. You're not just talking about
characteristics of demographics or time or distance or time series. It's very different type of work.
Aruna Viswanathan:
So we have experts who are the best of the best in the different areas and just work very closely
together. And I think that one of the biggest differentiators about our approach has been that we don't
let the subject matter expert who's been doing this workflow for 30 to 50 years of their life, tell how the
product should be designed. So there's a philosophy of keeping the customer away from the designer,
which allows the designer to come up with solutions that a customer or a user can never think of. And
that's how we think about building solutions. And we also philosophically think about this as future
proof, meaning build it on open source, build it in a way that you can extend it and scale it, maintain it
and grow it. Not just lock people into platforms, lock people into templates, gamify the interface, make
it exciting. So that's how we look at doing things differently. And then we just look for best in class,
wherever they are, as opposed to trying to find them all here or expect that they all know each other's
discipline.
David Droogleever:
I love the thought of making something you said philosophically, and sometimes I see philosophy and
strategy in kind of this one big glob that it's almost just thinking more expansively. And when you start
talking about open source and extensibility, I start thinking about ecosystem. So is there a ecosystem
play where third parties are able to, like you said, make things accessible, extensible, or even, hey, come
to the AlphaX conference. We see what other people are doing. What other sort of widgets people are
building on top of the platform. Is that somewhere in the future, if not now already?
Aruna Viswanathan:
I can't say that at this point in time. But I definitely feel like we have the ability, because we have already
built multiple areas to think about things like that down the road.
David Droogleever:
I did want to stay zoomed out and you've talked a lot about getting a lot of gratification of helping
business leaders, helping to optimize and streamline companies. And as you look at the lay of the land of
all the folks that you've helped, are there certain threads or motifs or themes that come up that help
you to identify what are the drivers of success that differentiate poor performing companies versus
really, really great ones that you with regularity bring to the conversation as you're advising and
consulting companies?
Aruna Viswanathan:
I think probably the most important characteristic of any entrepreneur is that they have to have a vision
that they believe in and are passion about. But have just enough. They have to have... It's a very
interesting skill of having enough of an ego to be able to survive the long haul and go down a route that
you believe in, but not enough of such an ego that you can't learn along the way. It's a very fine balance,
because if you're not willing to accept information or at least try to get to the truth of it, then you can
fall down a lot of rabbit holes. But at the same time, oh, people will give you all kinds of advice. And a lot
of it makes no sense because they've no idea what you're doing, right?
Aruna Viswanathan:
So you have to be able to filter that. And that is probably a characteristic that's interesting because if
you're on... I've seen many people who try to give advice to people feel offended when they don't take
the advice. But in fact, you have to be able to filter what advice makes sense if you're on that side of it
and have a belief in what you do. But other than that, I'd say teams, to be honest with David. I mean,
teams are probably the best. If you can find teams that work together or have worked together, but just
get along well. I mean, they have so much a greater chance of success because they can support each
other.
Aruna Viswanathan:
One person doing it alone is often a red flag because it creates so many different issues eventually if
they're not able to do build a team, but a high performing team, I mean, they can support each other.
They can develop more and they have a different sense about how they can grow the organization. I
think that it also means that the company culture becomes a little bit more diffuse across things, as
opposed to maybe just one person's view of everything, because ultimately companies are the culture
of the people who founded them.
David Droogleever:
Excellent. And last one, we talked offline about your involvement with community and giving back. And
how does that play out in your life? You had a lot of success and seems like it's important for you to give
back or pay it forward or whatever lexicon you want to use there. So what are some of the things that
you're really proud of in terms of being able to plug back or give of yourself to the community?
Aruna Viswanathan:
When I was growing up in Houston, I didn't think I'd ever come back here. Think a lot of kids [crosstalk
00:28:32] start in this city are like, no, we're never going to come back here. But I really love this city.
And I love the people that I've met along the way. I think that when you go out to folks to help them, the
first thing you should know is what is it about yourself or what is it that you're truly good at that you can
provide guidance and advice to? Because that makes a lot of sense, right. If you know that this is the
right place and the right type of situation, that you can help somebody, then people will know to come
to you when those sorts of things are coming up. And to the extent... So I think these days, I've worked a
lot more on the ground for many years.
Aruna Viswanathan:
And I also ran a nonprofit here, which is at Thai Houston for a little while. And so I've gotten to know a
lot of folks. I think that the way that you give back is you find the best ways that you are uniquely
capable of doing so. And then you try to just, for me, it's laser point in to those areas and where you can
have the highest impact. And I think that makes me feel the most rewarded and provides the best
benefit to whoever I'm trying to help.
David Droogleever:
Hmm. I'd like to think that giving back in the best way, I know how by helping to host this podcast, but I
guess time will tell.
Aruna Viswanathan:
I think everyone has a lot of gifts and they have to think about what they are and how they can provide
help. And I know you are.
David Droogleever:
Well, thank you. Appreciate that. I think one thing that always surprises me with the folks I've either
gone to school with, or otherwise, business leaders I engage with it's I think people are generally slow to
recognize what they're really good at. And I think quite oftentimes it takes someone to say, "Hey, this is
your skill. This is your superpower." And then you have them say, "Hmm, never thought of it that way."
So I love having those conversations. So well [crosstalk 00:30:45].
Aruna Viswanathan:
It does require some introspection to know what it is, what your superpower is and also to be able to
ask of feedback. That's true.
David Droogleever:
Hmm. Yeah. It takes a lot of courage too because you have to also be ready to hear things that may not
be exactly what you want to hear.
Aruna Viswanathan:
Yeah, that's true.
David Droogleever:
Aruna, it's been a pleasure talking with you and I know we could probably have part 8, 9, 10, 11 plus. So
I'll give the mic to you for final words and parting wisdom, perhaps. Any other call to action that you'd
like to give folks that were tuning in, in the Rice business community, perspective students and business
leaders and beyond? Any call to action or any recommendations for folks that either want to reach out
to you otherwise learn more about whatever we've discussed today?
Aruna Viswanathan:
Well, I absolutely welcome anybody who wants to reach out to me. You can find me on LinkedIn. I'm
sure that you'll post my name so it won't be too hard to find. I can certainly share my perspective with
regards to any of the topics that we've discussed here today. I think that as far as a call to action, we
didn't talk about this too much, but I think that one of the things that I would like to kind of state is that
we tend to see the world very binary, zeros and ones, right or wrong, leader or follower, that kind of
thing, or an entrepreneur or investor or something. And I think that's a [inaudible 00:32:22].
Aruna Viswanathan:
I think everybody has a lot of different talents. And I also think that there are a lot different perspectives
in the world. And so, especially right now, I think that people need to really use the skills that we learn in
MBA school, the critical thinking skills and put it to good use in society to help try to bridge these gaps
and try to keep people from being so much in this view that something is right or wrong or there's only
one way to solve the problem because that's absolutely not true. There's hundreds of ways to do
different things if you think about it enough and are creative.
David Droogleever:
Oh, if you didn't say creative, I was going to say it. Creativity solves everything.
Aruna Viswanathan:
Absolutely.
David Droogleever:
And there's no limit to the amount of creativity you can apply to any problem. So I love that you called
that out. Aruna, thank you so much for joining on today. And I'm looking forward to sharing this with the
community.
Aruna Viswanathan:
Thank you, David.
Christine Dobbyn:
This has been Owl Have You Know. Thanks for listening. You can find links and more information about
our guests, hosts and announcements on our website, business.rice.edu. Please subscribe to this
podcast wherever you find your favorite podcast and leave us a comment while you're at it. Let us know
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Droogleever.