focal podcast

Why saying "no" is the secret to growing faster as a startup founder

Most founders think raising $100M means spending aggressively. Adit Abraham raised $108M and spent only $1M - while landing Fortune 10 contracts very early on and having experienced zero enterprise churn to date.

In this episode, he reveals the counterintuitive focus strategies that helped Reducto turn documents into data better than anyone else, including why they fired a $5K contract, limited engineers to one priority per week, and spent months recruiting a single PhD instead of scaling the team quickly.

Adit Abraham is the co-founder and CEO of Reducto, an AI company that transforms documents into structured data for language models. He previously worked at Google and attempted other startups before Reducto, where he learned the hard lessons about focus that now drive his company's success. Reducto has raised over $100M from A16Z, Benchmark, First Round Capital, and Y Combinator.

In Today's Episode We Discuss:
02:04 - Pivoting from a viral product before Y Combinator even began
05:48 - How free computer vision consulting revealed real product-market fit
07:29 - The exact moment founders know they've found product-market fit
08:03 - Why going one layer deep on ideas is the most dangerous founder trap
11:10 - Choosing two PDF features over 35 file types competitors supported
14:54 - Turning down construction document contracts worth millions in revenue
17:10 - Past startup failures that became the blueprint for saying no successfully
22:25 - Cutting engineer to-do lists from 10 items to 1 weekly priority
27:45 - The doctor-patient framework that makes rejecting customers feel collaborative
31:35 - Maintaining velocity while scaling from 4 to 20 high-agency employees
36:08 - Prioritization without spreadsheets: qualitative judgment over point systems
38:50 - Spending $1 million after raising $108 million from top-tier VCs
40:52 - Why their first research hire is one of 10 best in world for document AI
46:35 - The fitness trainer analogy every founder misunderstands about company building
49:14 - When "stay lean" advice becomes the wrong strategy for your stage
50:16 - Why full-time commitment creates space for different experiments than side projects
52:04 - The VC conversation that made sharing bad news feel safe instead of scary

Creators and Guests

Host
Pascal Unger
Co-founder / Managing Partner at focal.vc We lead pre-seeds in North America with up to $1M: We exclusively back AI native software startups at the very start. Thereafter, we help them get off the ground better and faster, supported by a network > 200 GTM executives. That's our singular, unwavering focus.

What is focal podcast?

Pivotal early lessons of today's best startups.

Welcome to the focal podcast where we go deep with some of today's best founders and operators on ONE crucial lessons from their early days.

This podcast is not the usual "highlight reel" startup podcast that goes one inch deep across 20+ topics. Rather, we ask the questions you’d ask if you were sitting across from them. No fluff, just the real, actionable insights you’d get if these founders were mentoring you 1on1.

We cover topics including:

- What worked and why.
- Costly mistakes and how they fixed them.
- Frameworks that truly made a difference.
- Tactics to move faster.
- What they wish they’d known sooner.
- And much more!

"Only a fool learns from their own mistakes. The wise learn from the mistakes of others."