Akash Nigam struck a deal with his parents that he would either raise $3 million for his startup idea or go on to finish his college degree.
Nigam, 23, grew up in Silicon Valley and enrolled as an undergraduate in the University of Michigan. Like so many others in the startup hub of California’s Silicon Valley, entrepreneurship is in his blood.
Nigam’s father, Pavan Nigam, was the cofounder of medical website WebMD and is now an investor in tech ventures. Though his parents have the means to fund his idea for a company, they weren’t going to feed their son with a silver spoon. Pavan told CNN Money:
“Like any parent, and especially as an immigrant parent, I wanted him to finish college.”
However, Nigam had caught the startup bug early on during his junior year. He and two other friends launched a group messaging app called Blend, which they introduced to their fellow peers on campus. According to Nigam, more than half of the school’s approximately 14,000 undergraduate students were on the app. Nigam said:
“We knew we had something good. We had to pursue it full-time immediately.”
Nigam was in a rush, but his parents wanted him to be careful. His father wrote out a contract in May 2013 as a way to test his son’s determination and the quality of his idea. The contract detailed that Nigam was given the option to take a semester off to focus on Blend or if he could raise $3 million within six months he would be given more time for his startup. His father explained:
“He had to get the real VC world involved. The money wasn’t to come from me, or rich uncles and friends.”
Though Nigam and his co-founders fell short in raising $2.7 million in the span of seven months, his father was impressed. He was both a proud father who was also a bit jealous of his son. He told CNN:
“I knew by then that they had a solid product and they would get the money. He was 21, meeting people, raising money, striking deals. He was doing what I could have only dreamed of doing at that age.”
The Blend messaging app is in a saturated market filled with competitors, but Nigam is certain that he has the best product. Blend claims to have over 250,000 active users and has raised $10 million in funding.
Nigam says that the services on his app are doing things 10 times better its “archaic” group messaging competitors. The app allows private group chats and video and photo sharing that are commonly used among millennials. The public group option is a popular feature that sets Blend apart from other messaging apps. It is a feature useful to celebrities such as Canadian singer Shawn Mendes. Nigam said:
“This is our cut-and-dry differentiator. They are almost like interest groups where celebrities can easily communicate with fans in real time.”