SaaS Interviews with CEOs, Startups, Founders
He's ok burning $150k/mo right now with his $600k ARR Connected Vehicle Data SaaS
30 Nov 2022
Chapter 1: What is the main topic discussed in this episode?
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 a $1.2 million run rate. They're basically giving all the speed data, acceleration data from your car back to Geico. So Geico knows how to price your insurance, right? Or so you can get a cheaper rate.
That's sort of a good example there. They raised a 5.5 million series A last year, sold between call it 10 and 20% of the business doing that. Team of 36 today, they control their burn, which is net burn $150,000 per month right now by having their engineering team in India. They've got plenty of runway though to continue to drive growth. Hey folks, my guest today is Sandeep Ranjani.
Chapter 2: How does CerebrumX utilize connected vehicle data?
He's the CEO and co-founder of CerebrumX, a company that focused on unlocking the value of the connected vehicle. Before joining the company, he served as the SVP and GM of Automotive Service Business Unit at Harman International, leading the connected automotive cloud aftermarket OTA and cybersecurity businesses.
Over the 28 years of experience in the automotive and communication industry, he has extensive experience in creating and successfully launching secure cloud-based IoT services that enhance the experience and contribute to sustainability aspects. Sandeep, you ready to take us to the top? Hey, Sam, Nathan out here, likewise. All right. Very cool.
Wait, I want to make sure people don't get lost, right? CerebrumX.ai is an AI-powered connected vehicle data platform. What does that mean? So what we do is when we get the data from the vehicle, we process this in the cloud and then there is a machine learning platform which really turns out information out of the data, right? So for example, driving behavior, right?
So a lot of the machine learning goes into it, looking and analyzing the previous data to come up with some kind of a model which scores, which provides more insights and which is continuously learning, right? That whole model is continuously learning. How do you get the ability to collect the data from the coin in the first place?
Are you working directly with Ford and they put you in every truck? Yeah, so we work with the top four OEMs minus GM right now in North America. You said the top five minus GM? Yes, minus GM, right. So who are those four? Name the other ones. Yeah, so you can guess it, right? Out of the five in terms of the sales, right? So minus GM, all the four, right?
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Chapter 3: Who are the key partners for data collection in connected vehicles?
Sandeep, sorry, my audience doesn't necessarily know the car market like you know the car market. Are you not able to talk about the other four? For example, Ford, you have Stellantis, Nissan, and then we talk about the Toyota's of the world. Okay. So yeah, to walk me through, I've just bought a Ford truck from the dealership yesterday.
Is your software automatically installed in that Ford truck? No, we don't. So we don't collect the data without your consent, right? Nothing works without your consent, right? So typically what happens is that, say that you are part of a fleet, right? The Toyota vehicle Ford truck is part of a fleet, right?
So what will happen is that once you give a consent that I am okay to share my data, that consent gets passed on to the OEMs, right? Sandeep, though, I imagine you've got to install during the manufacturing process some piece of hardware to actually capture this data, right?
Even if you have to wait for the user or the buyer of the car to say yes, you have to build in some piece of hardware, right? So that hardware is already there in your vehicle. Every vehicle already has a modem built in, just like your mobile phone. Every vehicle already has a modem which is already built in.
So from the perspective of enabling the data that already exists, that data already exists, right?
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Chapter 4: What consent is required for data sharing from vehicles?
So what is happening is that once you give up consent, that data gets sent to the cloud, and then it gets handed over to Cerebronex, right? Understood. Name some examples, because you're not selling to consumers, I don't think. You're selling to companies that have fleets of Ford trucks, and they want to track all of their fleet of Ford trucks, right? Yeah, exactly.
Let's say that if you take the specific example of, let's say, a Ford, let's say that, for example, you are looking for an insurance deal, right? You're looking at an insurance and you go to one of those insurance providers, right? Well, the problem is, my audience has to know, when you use the word you, they don't know what you means. Who is you? So as a consumer, right?
When you're a consumer, like let's say Nathan says, well, I need to get an insurance. And what you do is you go to one of the, like a Geico's of the world, right? And you go to them, you say, well, I need insurance. And what you would do is you would click on the portal. And what will happen is you would say that, yes, I'm ready to share my data.
So that information from the likes of the insurance companies like Geico, et cetera, comes to us. And from that consent, what we do is we pass that on to Ford. And based on that, I think consent, I think the data starts coming to us. And then we really work on the data and pass on to the insurance companies. Okay. So I, as a consumer, go to Geico. I say, yes, Geico, you can get my data.
That notifies your hardware or your application in my Ford truck. You pass my speeding or stop sign data to Ford. Then what does Ford do with it? So Ford doesn't do.
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Chapter 5: How do insurance companies benefit from connected vehicle data?
Ford is only concerned about your consent. They're really particular whether if the data they're passing on, the consent is there or not.
So based on your driving habit, like if you're over-speeding or if, for example, your acceleration, your driving behavior is not right, there is an issue with your driving behavior, what happens is your insurance policy, your premium could go positive, negative, right? If you're a good driver, you get the benefit. If you're not a good driver. No, I understand. I think everyone understands that.
I'm trying to understand the information flow. So who's paying you, Ford, GEICO, or the consumer? It'll be coming in from the GEICO side or any of those insurers. Okay. So when you say you work with a top five minus GM, those are not your customers. Your customers are insurance like GEICO. Yeah. So if you look into these top five are raw material, that's where you get the data from.
are the consumers of the data. The people who are paying for the data are the insurance companies. They are the fleet companies, the fleet providers like Azuga, which is part of Bridgestone or the aftermarket companies. Okay. So those are the people who are paying.
Chapter 6: What is the revenue model for CerebrumX?
Sorry, name an example. Name a couple other examples of fleet companies that pay you. For example, Bridgestone Mobility, right? Sorry, I say that slower. Bridgestone. Bridgestone Mobility. Azuga is a company. Let's say Azuga is a company. So you're saying it fast, and I can't understand the company you're saying. So Bitstorm, B-I-T-S-T-O-R-M? B-R-I-D-G-E, Bridgestorm. Bridge. Bridge. Okay.
Bridgestorm Mobility. Yeah. So Bridgestorm, they have their mobility, which is they have a fleet division, which is Azuga, A-Z-U-G-A. Got it. So typically what will happen is that Azuga would come to us and say, well, I need data from, let's say, a Stellantis vehicle, for example. So what we do is we go and tell Stellantis that this is what consent which we have.
Chapter 7: How has CerebrumX scaled since its launch?
The consent gets passed on to Stellantis and then Stellantis enables those. Sorry, Sandeep, I don't know how to. So there's Bridgestone, there's Bridgestone Mobility Fleet, and there's a Zuka inside of that fleet. What is Stellantis? So Stellantis is FCA. It's an FCA for Fiat Chrysler. Oh, it's a type of car. No, it's a company, right? Stellantis is a company which is Fiat Chrysler plus PSA.
Got it. Fiat Chrysler plus PSA combined is Stellantis. Got it. This was a new nomenclature which happened, I think the whole budget happened in 2020. Yeah, this is a car brand. They own Chrysler and Fiat. Yeah. So now let's say that they have a Ram truck, like Ram 1500, right? And that is part of a fleet of Azuga, right?
So Azuga would come to us and say, well, I need to track these vehicles, their vehicles, which are the RAM trucks. That's what you do.
Chapter 8: What challenges does CerebrumX face in managing its burn rate?
You're tracking RAM trucks. It gives us a consent. Yes, I think it's okay legally all right to really get the data for these RAM trucks. that information gets passed to the car manufacturer. In this case, it's Stellantis. And once it gets that data, that full confirmation, they start giving you the data out, right? So that's the whole process.
In this case... So guys, sorry, just to be clear, just for everyone listening, Azuga is a company owned by Bridgestone that allows you to upgrade your fleet with their GPS tracking software and dash cams. It sounds like, Sandeep, you are built into that software module. Yeah, so what will happen is right now, that company is using some other mechanism to track the data.
There is an adjunct device by which they get this information, right? Which is not coming in from the vehicle. It is coming from an adjunct hardware. They have to put an extra hardware to track the data. Okay. You replaced that. Yes, we replaced that. Understood. So the tracking now becomes natural because the data is coming from the vehicle itself. Understood.
Okay, so again, I want to make sure you get your customers here. And then I want to make sure we're short on time. So I want to get to the other stuff here. But insurance companies, fleet companies like Bridgestone Mobility, and what was the third kind of customer? It is more like an aftermarket warranty companies. There is a company Axiom Connected, A-X-I-O-M, Axiom Connected. Interesting.
Okay, cool. Very cool. Okay. And then give me an example. But I want to get your backstory here. But before we do that, what does the average customer pay you per month or per year to use this technology? So typically, you get an average revenue per vehicle, it goes somewhere between $72, which is six bucks per month, to up to 10 bucks, right, which can go up to around $120 per month, right?
So it depends upon what data they are getting, what data they are getting. So how many vehicles though when a new customer signs up for you how many vehicles are they usually managing five ten a hundred a thousand so so typically most of these customers we have more than 100 uh, key kind of vehicles, right? These speed companies, they have a hundred thousand plus vehicles, right? Okay.
So if someone's signing up for you to manage a hundred vehicles at 70 bucks a year, that's a $7,000 per year contract. That's your sweet spot. So that, that's, that's the way it works. But again, then it scales up, right? Because then, yeah, but is that your sweet spot? Would you say the average is right around there? 7,000 a year for a hundred cars?
Yeah, for 100 cars, but we're talking about 100k vehicles, not 100 cars. We are talking about 100,000 vehicles, right? Each of these speed companies, for example, Azuga has 100,000 vehicles. No, Sandeep, I understand that. I'm asking you, when they pay you, are they typically paying on average for 100 cars at 70 bucks a year or 100,000 at 70 bucks a year? What is your sweet spot?
So our sweet spot, when it starts with something around 1,000 vehicles, 1,000 to 2,000, that's what we start with. Then we scale up. Okay. So that's like 70 grand to, that's like 70,000 to 140,000 a year or something like that. So that's, that's what it's typical customer would start with somewhere around 70K to 140, 120K kind of listing. I see.
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