How Brightmerge CEO Daniel Schwab grew Brightmerge to $104.2K revenue and 4 customers in 2024.

hey folks my guest today is daniel schwabe is the founder and ceo of bright merge a leading data optimization platform for local renewable energy systems or micro grids daniel you ready to take us to the top go through all right tell us more about about bright source or sorry about bright merge who's paying you for this technology we work with energy companies utilities and real estate companies who are very aggressively pursuing a decarbonization program and esg targets that sort of sort of stuff yeah and just capturing the value of renewable energy that is uh tremendously it's one of the greatest uh uh economic opportunities of our age and uh you know the economics are just so attractive now it's not just about decarbonization and esg uh it's just super attractive what we do is we we help people understand the real economic opportunity there so they can you know turbo boost the adoption of renewable energy now you say this is an end-to-end sas platform for microgrid economic optimization who are some of the customers paying you and how much are they paying you on average per month to use the technology so uh so we've worked with some a global real estate company they uh they typically will pay us per seat about 250 dollars per seat per project uh typically our clients will do dozens or hundreds and we have thousands of projects so it's kind of a very scalable uh business model where you can start with one project one seat and then expand from there so uh you know we we aim to start an average ten to fifteen thousand dollars a year and then grow from there could go very quickly into the millions per per enterprise customer i understand and are you guys pre-revenue today or do you have a couple customers already so we have a few customers um we they're more design partners and investors as well so uh we've been working with uh two key customers for the last year and we're now expanding over the next ten and as i say each one of them are doing big volumes so they'll they'll they'll expand uh you know this the the the acquisition costs are relatively low uh we can grow grow internally into the organization so daniel how many paying customers today it sounds like three or four oh yeah yeah so we're we're sort of doing uh just south of ten thousand dollar arr yeah per customer yep yeah so four customers that you know ten thousand dollar acv i mean that would put you at like four or five thousand bucks a month right now on revenue is that about right yeah it's a good bullpup and when did you start selling um about six months ago so a year ago you were at zero revenue right that's a good growth rate zero to 48 grand a year huh yeah i mean i think you know what we did was we we spent a lot of time building the product before and so you know there was a big waiting list big customer interest in the product before we actually launched how big was the wait list so we've got around 50 customers waiting um ready to be onboarded so we're probably on board at the rates of about two a month daniel when did you write the first line of code for the platform sorry when did you write the first line of code for the platform so it's a pretty complex product um there's a simulation and optimization engine in the back end so we've been doing this about two years um yeah and we've been funded by uh the u.s and israeli innovation authority in the department of energy so this is you know very much uh you know sort of big picture funding so how much was your first fundraise in what year uh we raised uh grant funding uh in 2012 we started 2020. uh sorry 2020 sorry 29 2019 uh early 2019 we raised about uh 450 000. and what have you already sensed uh additional 550 so it's close to a million okay so 550 was in 2020 or this year uh this year this year okay and you'd consider that what your seed round well it's kind of pre-seed early seed yeah yeah got it that makes sense now help me understand i mean most people when they're doing the pre-seed round they're selling about 20 of the business is that about what you sold yeah it's a little less than that but yeah okay a little less fair enough um very cool and so so that would i mean that would mean you know three four million dollar evaluation something like that uh bump it up a little bit more fair enough all right we'll go up today five million valuations today fair enough yeah we're looking we're looking at a big jump since the previous uh [Music] since the previous what since the previous round so i'm saying if you look at the valuation now it's it's it's north event north of 5 million yeah set by who is that what you believe it's worth or did someone invest at that price well we've got we're having discussions now with different investors oh i see so if you do raise right now how much are you targeting to raise we're looking to raise uh an another million now uh and then early next year probably in the round of six six million and and why do you need a million today uh there's a couple of features uh we wanna we wanna get into the product so that we can scale it much quicker um so you know there's some heavy heavy r d lifting that we needed to do and if you're at above a five million valuation today what was your valuation back in 2019 when you raised 450 grand oh close to two to three two and that was a cap on the note right yeah yeah tell me more about the team today how many folks uh so we've we've just grown to about eight now uh we've got some data scientists super smart uh algorithm developers enterprise sas um really smart electrical engineering so we have to have a really deep and integrated team of different skills daniel how many engineers total uh five five engineers and what do the other uh four do or three do uh sales marketing what's your target you're doing 40 you know four or five grand a month today in revenue what do you think you can hit in six months well i'd like to do uh next year total an ar half a million dollars i mean there's this significant growth coming up mm-hmm uh and how do you get there is it expanding the number of seats and projects on the current four customers or adding brand new customers all together well we'll do both we'll do both what do you think is gonna be more powerful driver of your growth um i think you know expanding our existing customers that'll be a much quicker ramp because it does the time for them to you know for a customer to get comfortable with the product and see the value it takes probably six months for that to happen so um you know the big the big growth of new customers will be seen at the end of next year how do you measure like the success folks have using you to hit their esg goals is there like a number you know tons of carbon removed from the atmosphere metric you can track through the platform or something like that yeah exactly so we'll measure it at a very hyper local basis so if it's an industrial zone a commercial zone or a community uh we can do that calculation um sort of looking at a baseline what they currently are you know their energy carbon emissions and then what it will look like once they deploy new systems and how do you measure that take us into the tech a little bit is there a physical installation of something uh no it's a data feed so we've got the apis connected to different systems consumption profiles weather data tariff structures um the the energy content so understanding if the energy content is coal gas nuclear wind solar uh that each each energy production system has a different carbon profile so you have to really understand the specific carbon profile of that particular location interesting and so your which of these product solutions you've got dashboards onboarding feasibility reports some other stuff which one right now is the the number one sort of use case yeah so i mean we take people from uh conceptualization of the project so they they start collecting data on our platform through a questionnaire process then the analytics occur and then there's dashboards uh it's it's currently very focused on the financials uh and we'll be layering on additional also the reliability is becoming more and more of an issue so it's not just about carbon and economics it's also you know how reliable is your energy so you know think about the modern world it's critical that you have uptime 24 7 365 that's actually not happening uh even in places like california texas new york when there's hurricanes fires earthquakes freezing so it's really important for the customers to understand what is their predicted reliability of energy and they want to make sure they have as reliable as possible but they don't want to pay a premium so we have to keep it optimized understood daniel we're rooting for you on that no let's wrap up here with the famous five number one what's your favorite business book your business book is the jack welch uh what's it called the winner number two is there a ceo you're following or studying uh i'm a big fan of elon musk there's nothing you know nothing that beats him number three what's your favorite online tool for building a business um i'm you know we're using slack you know it's really it's i think it's it's a great product to to keep teams going especially in this world where we're doing a lot of uh remote remote work number four how many hours of sleep to get every night well it varies between six and four so fair and what's your situation married single kids uh seven kids divorced wow seven kiddos okay not married and how old are you 46 46 last question...