SaaS Interviews with CEOs, Startups, Founders
Car Technology SaaS Hits $1.2m ARR, Sold 14% for $500k
09 Apr 2022
Chapter 1: How many vehicles are currently using Zelliot's technology?
You have, with Zelliot, installed 100,000 vehicles on the road today.
See, 100,000 vehicles are using our software.
And you charge a dollar per vehicle per month. So you're doing about $100,000 in revenue per month?
Yes. The average revenue run rate has been close to $100,000 per month.
You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom. If you'd like to subscribe, go to getlatka.com.
We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews. Check it out right now at getlatka.com. Hey folks, my guest today is Anoop Naik.
He, along with his partners, co-founded Zelliot in April 2018. He comes with experience of working with a founder very closely in his previous stint as an IoT startup called Cookie. He's been fairly successful in embedding his philosophy of running a startup with a hybrid thought process, i.e.
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Chapter 2: What is the average revenue generated per vehicle per month?
bringing revenue from customers by delivering value from day one, and also look to raise money from a good investor, but the money raised should be mainly used for bringing a new innovative product to market. Zelliot offers connected mobility platform to enterprises, and OEMs. Anoop, you ready to take us to the top?
Yes, absolutely, Nathan. Good to go.
All right. So what kinds of OEMs and enterprises are paying for your technology today?
So Nathan, as I mean, you already read out, connected mobility platform is something which vehicles use, right? It could be any kind of vehicles. It could be a car or a bus or a truck or a two-wheeler, whatever it is, right? So the typical OEMs who pay for us are the ones who manufacture this The enterprises segment falls under the people who use it for their own business.
Let's say logistic companies, right? Logistics companies have the entire business model revolves around vehicles. So those are the typical enterprises who pay us for using our software. And on the OEM side who manufacture these vehicles, let's say the likes of Royal Enfield for bikes, right? Indian major, Indian two-wheeler, famous globally as well.
Maruti Suzuki, you might have heard of it, right? So these kinds of companies who, you know, kind of typically use our connected mobility platform as part of their core offering.
Got it. So vehicle manufacturers pay for your technology so they can add connected mobility to their vehicles.
Yes.
And what do they pay you per month on average to use your technology?
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Chapter 3: Who are Zelliot's typical customers and what industries do they belong to?
Now you're over $100,000. So more than 100% year over year growth. Have you done all this bootstrap or did you raise capital?
So we very, very recently closed a seed round with Bosch in March. Till then we were bootstrapped. We have raised some debt funding, debt funding of close to $150,000, right? So recently we closed a kind of a seed round with Robert Bosch.
How much did you raise?
So around $500,000 we raised.
And most folks in their seed round are selling 10 to 20% of the business. What valuation did you raise at?
So we sold around 14% of the business.
Okay. Around 14%. So that means your valuation was around 4.5 million?
Yes. 4.5 million.
Correct. 4.5. Okay. Got it. And why did you decide to raise equity? It sounds like you already are familiar with debt. Why not keep using debt?
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Chapter 4: What factors influence the pricing of Zelliot's services?
Maybe you can say that, yes. No, no, no.
That is the collateral. They're willing to give you a 79% interest rate because you're their customer. They're just forwarding their invoice factoring effectively.
And they're also our customer, right? They are also using our software for their hardware business.
How many customers do you have today?
Over 100 enterprise customers, small to large.
Got it. And all of those are manufacturers of cars, buses, trucks?
No. How many are manufacturers? Manufacturers are roughly 10% of them.
Okay. And so then everyone else are people like iTriangle?
Enterprises. Yeah. Enterprises like, let's say, I'll give you an example of a company you might have heard. I don't know. Have you heard of Tata? Let's say Tata. Tata. T-A-T-A. Large Indian conglomerate. All right. Indian Oil Corporation, a large Indian conglomerate, again.
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Chapter 5: How does the subscription model work for vehicle manufacturers?
Bangalore, yeah.
Okay. What's a junior developer charge go for these days in Bangalore? What do you have to pay them salary-wise?
This value is increasing too high, but I know if I have to give an average figure out of that, five lakh would be somewhere around $10,000, $15,000 a year.
Okay, got it.
So about 12... $15,000, $20,000, yeah.
Yeah. 1200, 1200 a month, something like that. Okay.
Interesting.
So 35 engineers, do you have any sales reps that carry a quota or no?
So we have a small team of four people, right? Four to five sales team, a salespeople team. The reason we have small team, because we rely on large accounts, which take, let's say four or five months to, um, you know, convert these auto OEMs or these large enterprises. They don't close in a matter of days. You have to do POCs, you have to do a lot of stuff behind the screen.
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Chapter 6: What growth milestones has Zelliot achieved recently?
Any plans to raise capital later this year or you think you're good for a while?
So we are planning to raise the capital as we expand. See, we have a very, very small business in Africa. As we expand geographies, we will need more capital to onboard more customers. So we are going to raise the capital by end of the year. That will either be pre-series A or series A kind of a deal based on the growth that we are showing this year.
So we are supposed to grow about 4X on the revenue side. We have closed the year just short of a million dollars, right? So this year, the projection is we are supposed to hit around $4 million. So once we do that, or once we are on the roadmap to do that, we are planning to raise the capital.
Very good. We're out of time. Let's wrap up with the famous five. Number one, favorite book?
Steve Jobs.
Number two, is there a CEO you're following or studying?
So I follow Elon Musk.
Number four, how many hours of sleep? Or number three, what's your favorite online tool for building as Elliot?
jeera number four how many hours of sleep to get every night no i'm i'm a little comfortable on that let's say about seven hours roughly seven okay and what's your situation a new married single kids i have married i have a 10 month old kid oh wow a young one congrats and how old are you so i'm about 31.
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