SaaS Interviews with CEOs, Startups, Founders
1229 This Single Mom is Turning Mexican Propane Industry on its Head
05 Dec 2018
Chapter 1: What is the main topic discussed in this episode?
it's hard work get it done jennifer gas and you never guess propane in mexico such a big industry but it sounds like three billion people kind of rely on this as their key energy source that she's helping folks install a device that basically measures it and then saying hey here are the people here's a supply you can buy from here's a five-star rating here's a three you decide and she's making a cut she's now launching into kind of a sass aspect of the business to grow revenues quickly piloting with five to ten of our customers right now we'll see how it goes
This is the Top Entrepreneurs Podcast, where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple of hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everyone. My guest today is Jennifer Reyna.
She's energetic, hardworking, and totally determined, always learning and eager to help fellow entrepreneurs. She's been leading her company, Gasen, for more than three years now from idea to product and raising more than $700,000 in United States dollars while she's based out in Mexico.
Chapter 2: How did Jennifer Reyna start her journey in the propane industry?
Gasen is now raising interest in four countries in Latin America, helping make propane more efficient and the service easier to get access to. Jennifer, are you ready to take us to the top? Hey, how are you? It's great being here again, and I'm really excited talking to you. Me too. I'm so glad that you decided to come back on. I'm trying to remember the date when you last came on.
I mean, it had to have been, what was it? It was like two years ago, right? Maybe a year and a half? Yeah, a year and a half, I would think so. Yeah. So update us. What's the company doing? How do you make money? Okay, so we're making money by selling our devices. We found out a whole new market since the last time we talked to.
We found out that companies and industries are having the huge pain also of managing their propane. So we are gaining traction there with those precise customers. We have sold already more than 2,200 devices in contracts and directly. And we are now raising our new round of 1 million to make
New improvements to the product, gaining more market, and really establish ourselves as the leaders here in Mexico and new countries in Latin America. I love that, Jennifer. What valuation are you trying to raise at? Six million. Six. Pre or post? Post. Post money. So five million pre, one post. And you want to do equity or convertible note? Equity. Equity. Yeah, that's great.
So you've sold kind of 2200 of these devices and correct me if I'm wrong, they kind of sit on top of the propane things on rooftops and people know then like how much is left, right? Precisely. And the thing that we found out is that companies are still managing propane papers.
We provide them a dashboard where they can see all their transactions, they can learn all their statistics, and that way they actually gain control of that expenditure. And why do people use propane? Like, I'm in the States here. I don't remember the last time I touched anything related to propane. Why is it prevalent in Mexico? That's an amazing question.
So you don't know anything about propane? Correct.
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Chapter 3: What challenges did Gaszen face in manufacturing?
3 billion people around the world that uses propane as their main source of energy to cook to heat their home to have hot showers so for us it's a basic need in a lot of the cities and countries that we have even in communities interesting okay and so so i mean over the past 12 months how much have you done in revenue uh it's been challengeful we have made like uh
$100,000 in contracts, more in revenue. We had a tough six months because gaining traction in manufacturing was very hard. Doing a product in Mexico turned out to be a huge challenge, even from the plastic
everything really for us and it was supposed to take us three months to get it done and working and it took us eight months so for every hardware entrepreneur i would say be very very very precise on how you project your money making manufacturing working out so a hundred thousand bucks have made and that's just from selling each of these devices right yes and how much does each go for
Each one goes 100, but we have a recurrent for the services that we sell to different companies. Those ones we are just starting selling. We started just two months ago. So that's our new way of also making this money grow. Yeah. And there are a lot of companies in the States where there's a piece of hardware that is a loss leader that you get installed.
And then the hardware creates amazing stickiness for a software upsell. And so it sounds like that's kind of what you're looking to do. What are you doing right now? How much in monthly recurring revenue, SaaS revenue are you doing? Yeah, exactly. Right now, that's what we are doing. We just started. So like our revenue, it's like five, 10 clients that we started piloting.
It was always our strategy. We first wanted to give out the device. And once we got the traction, then we start monetizing on it. And why is it? Because we are creating a marketplace where people can buy gas in Iraq. And they can check like all the gas suppliers. They can see who's the best gas supplier in the region.
So this was always the strategy, but we knew it was going to be like in a million long. What will people pay though? So the 500 you're piloting per month, if they sign up for the monthly recurring products, what will they pay per month? So they will be paying, all of them are companies and they will be paying $20 per month.
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Chapter 4: How does Gaszen generate revenue with its devices?
Okay. So it's the basic way we are monetizing right now. And with the end customer, meaning residentials, they will be paying like a dollar per order they make through our marketplace. So we are gaining there a part of the transactions about for paying.
This just feels so hard, Jennifer, and I want you to get like filthy rich, but like you have to sell a physical object and then upsell the software. And then even if you do that, it's only 20 bucks a month. And it's like, how do you build this into a big company? We're building it with scale. That's the trick, scalability.
And the trick with manufacturing, it's precisely scaling at the same time that you are selling more. So that's a huge challenge we are facing. We are thinking in going to China. We are thinking in growing in Mexico because the device cost is something that we want to reduce to the fact that we can even give them away. What's the cost? Right now, it costs us around 47 US dollars.
Delivered to your door? Yes. Got it. And you're upselling, what are you selling them for? 120, 100, depending on the channel, but yeah. So some markup there, that's good. But again, it's taking you, when did you launch the company, what year? January 2015. Okay, so yeah. No, 16. 16, yeah. So it's taking you two, two and a half years to get 2,000 devices out there.
I mean, how quickly can you get 20,000 and then 200,000 out? Yeah, I think it'll be just establishing. You know, that's the thing with hardware.
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Chapter 5: What is the significance of propane in Mexico?
First, you have to run the first pilots, make sure you have no problems testing the product. So we're thinking we're going to sell like the 20,000 in two years. We have to be targeting at that amount. And it should be growing like 200% from year to year, aside the fact that we get enough money, we get the right manufacturing partner, And we also get like the very good channels to sell to that.
We are already going there, but we need more traction in terms of manufacturing. And why do these businesses care about managing their propane sale? Like, do they really save a lot of money with your system? They can save the tests that we have so far in residential. We are seeing that people can save like 30%, 30 to 40%, which is huge.
And in industries, the ones that we have tested goes like from 15 to 23%. And this is only in the fact that they know what they're paying, that they get what they're paying for, which is huge. In the US, you have a huge, you know, like trust in your suppliers. But in Latin America and in other countries, they don't. Like, we really don't trust them.
So are you introducing, though, your customers directly to the production companies? Or you actually have, like, you buy propane in bulk and then you sell it through to your customers? No, right now we are presenting. We are doing the marketplace where we tell them, look, like, this is the supply. These are the gas suppliers. And this one has, like, three... Three rate out of five.
This one has one. This one has five. And the different prices. So they actually have the power to choose the best option. I see. Jennifer, I love it. Let's wrap up here with the famous five. Number one, what's your favorite business book?
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Chapter 6: How much revenue has Gaszen generated in the past year?
Right now, I would say it's Lean Startup. No, you know, the hard thing about things. Hard thing about hard things. Number two, is there a CEO you're following or studying right now? Yes, actually, I'm really talking to Abby T. He is the CEO of Nyan Consultants, and he's been very helpful with us. Number three, what's your favorite online tool for building a business? I would say Monday. Love it.
Monday. Yeah, Monday. That's a good one. Why do you use them? How do you use them? We use them all the time to keep track on all of our different chiefs. I know that they're amazing. supposed to be doing all the activities and tasks that we are having and the challenges we are confronting, we give follow up to them through Monday. Okay.
And how many of your team, how many of your team members do you have on Monday? Uh, 13, 13. Wow. And so you use it. Is it, I mean, is it better than Slack?
uh yes for us yes because we have visibility of all the issues we are having uh the communications that we like it we use it but i think it doesn't give you the like the visuals of where you are at and which is the challenge and how long have you been having it so that's very helpful and i love it about monday that's great number four how many hours of sleep do you get every night i would say around six six okay in which situation married single you have kids
I have a kid. I have a kid and I'm a single mother. Okay, single and one kiddo. And do you mind me asking how old you are? I'm 28. 28. Last question.
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Chapter 7: What are the future plans for Gaszen's growth and scalability?
What do you wish your 20-year-old self knew? Okay, that was a good one. That it's just hard work, determination, and If you want something to happen, you have to make it happen. Guys, there you have it. It's hard work. Get it done. Jennifer, gas and you never guess. Propane in Mexico, such a big industry, but it sounds like 3 billion people kind of rely on this as their key energy source.
She's helping folks install a device that basically measures it and then saying, hey, Here are the people. Here's a supply you can buy from. Here's a five-star rating. Here's a three. You decide, and she's making a cut. She's now launching into kind of a SaaS aspect of the business to grow revenues quickly, piloting with five to 10 of our customers right now. We'll see how it goes.
Jennifer, thank you for taking us to the top. Thank you so much, Nathan. Have a great day.
Chapter 8: What advice does Jennifer have for aspiring entrepreneurs?
I'm rooting for you. Good luck.