SaaS Interviews with CEOs, Startups, Founders
751: IoT Electricity Measuring King Raises $16m w/ $1.2 Million Revenue
14 Aug 2017
Chapter 1: What is the main topic discussed in this episode?
Now teamed up with two co-founders to launch, again, Vertigris, a new company, basically helps you kind of cool with little kind of sensor clamps in your electrical boxes with kind of an iPhone-like device, measuring your electricity usage to help you run your systems more efficiently.
Chapter 2: What is the core mission of Verdigris?
You know, to see returns, you gotta be spending, you know, somewhere between, you know, above 10 grand per month on that kind of stuff.
Chapter 3: How does Verdigris utilize AI for energy management?
But currently they're serving 300 customers, paying on average, call it 800, 900 a grand per month, doing about 260 grand in monthly recurring revenue. This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base.
Chapter 4: What is the revenue model for Verdigris's hardware and software?
You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per top. Five and six million.
Chapter 5: How has Verdigris achieved a low customer churn rate?
He is hell-bent on global domination.
Chapter 6: What is the significance of measuring electricity usage?
We just broke our 100,000-unit soul mark. And I'm your host, Nathan Latka.
Chapter 7: How does Verdigris leverage partnerships for growth?
This is episode 751. Coming up tomorrow morning, Adrian Nossenbaum joins us. He thinks that retailers want their own version of Amazon, and he is cashing in. Hello, everybody. My guest today is Mark Chung. He's the CEO and co-founder of a company called Vertigris, a Silicon Valley-based internet of... things startup focused on smart buildings.
Previously, he was a principal engineer at AMD, NetLogic, and another company, Passemi, I believe.
Chapter 8: What are the financial goals for Verdigris in 2017?
He graduated in electrical engineering from Stanford University and lives in Sunnyvale, California. When he's not building, he enjoys spending time with his family. Mark, are you ready to take us to the top? Yeah, thanks, Nathan. Thanks for having me. So what does your house look like?
Are there a bunch of gadgets and contraptions and you tell your wife and your kids, hey, I'm just A-B testing, I'm prototyping? Oh, I wish it was, I wish it was that elaborate. My, my wife doesn't let me experiment much with the stuff in our house, but just actually just getting solar today or this week. That's pretty funny. Okay. So, so obviously married wife, how many kids you have? I have two.
Two little ones. Okay. And so tell us about the company. What's it doing? What did you launch it in? So the company is an artificial intelligence company. We launched in 2012 full-time, and we basically focus on developing technology for commercial buildings to better manage their energy. And give me an example of what it looks like installed. Name a customer and how they use it.
Yeah, one of our largest customers is Jabil. It's a very large manufacturing firm, global conglomerate. We have a bunch of sensors that install at their electric panels, and we use that to collect data all around their facilities about various equipment that they're running, processes, lines, motors, pumps, air handlers.
We synthesize this into a very easy to use and easy to understand set of reports that their facilities managers or their finance people can then review, understand where they might be losing money on electricity or identifying where potential equipment could fail. And in the process, we hope to save them lots of money.
And in fact, they've come out and said that we've saved about 50% of their operational costs through using our solution. Which is how much? I mean, I imagine they're in the millions in terms of operational costs. Millions of dollars. Paint this picture for us.
I mean, is this literally a little piece of hardware, something I can touch and feel you're putting on every electrical thing, or is it software? It's a combination. So there's a small little magnetic device. It opens like a small clamp, and you clip this in. There's actually a number of them that they connect together, like a little daisy chain.
And it goes to a small, kind of like, you can think of it like an iPhone that's sitting outside that panel. And what it's doing is just dialing up and listening to the electricity talking in your building. And every device that's connected to that, either your outlets or your wall sockets or whatever, They're all talking through these electricity wires and this phone is just listening to them.
Interesting. Okay. And so how do you make money? What's your revenue model here? We have kind of a hybrid model. We charge for the hardware when it gets installed and then we have a recurring software service. Which revenue stream is bigger for you?
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