How Buzz Solutions CEO Vik Chaudhry grew to $2M revenue and 3 customers in 2024.

hey folks my guest today is vic chaudry he's the co-founder chief technology officer and ceo at buzz solutions which is helping uh it's an ai based software platform for power line inspections vic you're ready to take us to the top yes sir thank you nathan for having me i'm excited to be here you bet how did you get into the power line industry is this a family thing or are you just passion project or what no so actually i'm originally from india new delhi india power has been when i was growing up power was was a big big problem we had constant power outages on a regular basis so uh what i did in my you know college days was i got involved with a lot of environmental engineering projects and that's what i pursued for my for my undergrad as well and then uh i came to to the us in 2015 for my grad school at stanford university and that's where i got involved in much more power projects i was working on a project where we were using drones to inspect uh wind turbines and that was sponsored by pg e and that kind of segued uh into the power utilities and helping them prevent you know wildfires and blackouts and those kind of uh you know disasters oh fascinating okay so who's your customer today who's paying you yeah so our customers are power utilities and power companies so our major utilities uh in the us and canada and also recently we started working with a few utilities in australia so we are we are growing our customer base and this is a this is a big need in terms of great infrastructure improvement and transformation and modernization a lot of the components electrical components on that grid is you know as you can see 75 years old uh which is off their shelf life so so very much needed right now there's a lot of worry right now about hackers and right products you know these sorts of things are you doing any anti-terrorism related stuff or you know can you help ukraine's you know make sure russia's not taking down telephone wires i mean can you do stuff like this yet yeah not yet but we do uh provide a lot of security on uh the data that is collected around grid infrastructure so we provide cyber security for that and that is critical of everything that is digital we be our software digital ai company uh we provide cyber security on top of that so hopefully in the future we we can provide uh you know some risk assessment with risk mitigation around you know cyber attacks and and uh even uh entire anti-terrorism initiatives but for now we are just focused on modernizing the grid and i'm sure you have a huge range but what's the average power company pay you today per month or per year to use your technology yeah so it varies according to the project the power company is using or the you know the how big the power company is and how much mileage of lines the power lines they have but we have seen a range we have seen somewhere uh in the range from 200 000 us dollars uh arr which is annual recurring revenue to even 1.5 million dollars so we recently won a contract of 1.5 million dollars with a major utility in the us and it's a multi-year contract got it so 1.5 million over how many years that's five years five years wow and how many lines how many miles of lines will they manage with you about so that's around 2500 uh miles of transmission high voltage lines wow interesting okay so you have a nice usage based upsell here which is mileage of lines managed that's correct yes very interesting okay and again range is cheapest customers 200k a year most biggest one is 1.5 over five years it can go excuse me it can go even higher than that for a lot of big companies especially pg e which is one of the biggest utility in the us we're trying to work with them as well uh they're california based they have around 19 000 miles of power lines so so it can even go above that for someone paying you your sort of your your lower range 200 000 a year about how many miles of power lines are they probably managing so on a regular basis uh they would you know somewhere around you know less than thousand miles of lines uh but they they do have you know other sites on there like substations and uh uh critical towers that they want to manage as well so so it varies we have also we've done projects ranging from you know 200 miles of line inspections to even as i was saying 2500 miles and it can go even above that oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is going to pay a different valuation private equity firm is different if you're going to do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when i hover over here right so the teal is what a vc would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on youtube all these datas are built from real time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 to their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of sas valuations than what you can get now inside of founder path and we're thrilled to bring it to you all right we're gonna go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your valuation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview but is this like a one time you inspect it once and they churn or are they they're paying 200 grand a year for many many years yeah so it is a constant process power utilities are kind of mandated to inspect their lines on a frequent basis so they on a you know monthly basis they would go out and inspect a certain subsection of the line and that's what they complete in a year and then they have to repeat that again because because of a lot of factors environmental factors all these electrical components are out in like heat snow you know storms high winds so they get damaged pretty quickly and as climate change is becoming much more uh a big factor over here and weather conditions are becoming much more extreme these these components are having much more pressure on them so there's constant need for inspection as well and so how many customers individual power companies are you working with today so we're working with three major ones in u.s and canada and uh we just are starting to work with a few in australia as well now can i take three times an average of two hundred thousand dollars an acv you're doing what something like fifty thousand dollars a month right now in mrr somewhere around that yeah okay and if you're doing that today where were you exactly a year ago do you remember yeah so last year um so those those revenue numbers are you know again a little bit confidential we did um we did started generating revenue last year uh and those were from our initial customers and this year i mean we have seen uh be projecting a big ramp up in our in our revenue uh i mean can you break a million dollar run right this year you think we are we are aiming for that yes yeah very interesting okay got it but just to be clear uh uh so no revenue before last year last year was your first dollar and this year you're somewhere sorry 40 50 60 000 a month right now yeah so somewhere around that range uh so 2020 was when we were doing a lot of uh proof of concepts with utilities a lot of free pocs and then last year we started doing paid pilots and uh some initial full uh you know full projects and then this year we are scaling up to more utilities and when did you launch the business first line of code was written in what year yeah so we launched in uh 2017 but uh the first two years we were working on building uh proprietary data sets for the machine learning and computer vision algorithms we had so we're collecting a lot of data from you know partnering with various utilities across geographies and then various you know electrical organizations like epri so we were working with partnering with them and uh working on building the product and then we launched our first commercial uh you know version of the product in late 2019 and that's when we started seeing a lot of pocs when so 2017 to 2020 i mean there's three years where you're basically having to either raise capital or live off your life savings because you're not making money from the company yet so how did you fund the business in the mvp did you raise or was it life savings yeah so initially we did win a grant uh which is uh which was tom stars grant it's called tomcat innovation transfer grant from stanford university so we launched out of stanford and they they kind of scope out companies or startups that are in how much was that grant that was fifty thousand dollars okay anyways uh we got uh grant money for and then we bootstrapped all the way and then in mid i would say mid 2020 june 2020 is when we raised our first uh seed round of funding so i think you raised 1.2 million then correct that's correct yes and most folks when they're raising a seat it's like a 5 to 10 million cap were you sort of in that range yeah that's great okay fair enough and then have you raised any other capital since then are you bootstrapping yeah so recently we uh closed another round of funding of uh you know 1.2 million which is again a seat extension and we are moving towards our series a uh aiming for that going forward okay so seat extension do you raise it up basically the same valuation or is it more like a 10 million valuation this time yeah it's an increased valuation uh which is we are keeping it in perhaps but yes it said increased valuation than before and why do an extension versus a traditional series a i mean maybe was revenue a little low to go do a traditional series a uh it was mostly because a lot of the the projects that we were running with customers they were aligning at the same time and we did need some resources on our side support in terms of engineering and customer support and we wanted to provide that to our customers so we were running a lot of projects in tandem which were three major utilities in tandem and uh we didn't needed some fuel at that point so uh we got an extension basically because of that project-based approach uh we could have gone for seriously but uh those projects were moving at the same time and procurement was having happening at the same time and we just wanted to deliver interesting okay what's the team size today how many people so we are currently 12 people uh but we are actively hiring for multiple engineering and project management how many engineers today full time we have um nine engineers and uh three eight to nine engineers and and three non-technical roles that's great now before we wrap up i am i mean the technology here right so you actually imagine you're using someone else's drone and then you're embedding your own software in that drone that ties back to like a computer ui or something is that how it works that's right so we provide a digital kind of software platform that is powered by our proprietary computer vision models to do anomaly detection and asset detection so a lot of machine vision stuff and also data management and analysis and visualization uh we do use data that is captured from by utilities so utilities are already they have drone teams they have helicopter teams that are going out in the field capturing you know hundreds of thousands of images and you know even millions of images now with much more frequent inspection on an annual basis so they are flying the vehicles and consider drone like a mobile sensor so they're flying to drones along the lines uh capturing all that data uh they are even contracting out drone service providers uh that are independent service providers that are providing those services so we collect everything that happens in the field comes back we process it we make insights out of it and send it back to the utilities is there anything preventing one utility company from buying this and then using it to scan their competitors lines to look at what their public earnings might look like next quarter yeah so usually utilities uh don't really compete they are mostly geographical based and uh okay then let's use a hedge fund as an example right if a hurricane really knocks out lines for one company maybe their stock's gonna go down next quarter hedge fund wants to know that can the hedge fund buy your service to monitor those lines so currently we're just selling it to utilities uh to to monitor the airlines uh again we we we sell our services as a subscription you know a standard enterprise sas based uh platform uh so if there if there was a need uh to kind of we've talked to insurance companies as well um yeah you know especially in the wildfire domain um and and we want to help everyone especially you know utilities we don't want anyone to compete it's it's a it's a problem that we all are facing as a society and we want to you know uh kind of mitigate that and do risk mitigation with that problem with our services like very cool love the vision let's wrap up here with the famous five number one favorite business book uh zero to one number two is there is is there a ceo you're following or studying uh let's see i mean the classic is elon musk again technology visionary but um recently the twitter's new ceo paraguay as well number three is what's your favorite online tool for building a business uh let's see online tool google sheets nothing wrong number four how many hours of sleep to eat every night i would say five to six hours i try to optimize and vic what's your situation married single kids single okay and how old are you i'm 29 29 last question something you wish you knew when you were 20. patience uh being patient and being persistent uh that's the key guys buzz solutions launched from a grant back in 2017 at stanford vic said you know and i grew up in india power outages were always an issue i need to create software that allows power companies to manage their lines and the breakages and issues and damage much faster and that's what he's doing now working with three customers doing between caught 40 and 60 000 bucks a month in mrr trying to break a million this year they've raised 2.4 million to date most recently 1.2 million seat extension this year a team of 12 people actively hiring engineers as they look to scale this product again which helps power companies manage and monitor those lines vic thanks for taking it to the top thank you nathan one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world whether it's an acquisition a big fundraise a big sale a big profitability statement or something else i don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack community for b2b sas founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can go in there and quickly search and see what people are saying sign up for that at nathanlacka.com forward slash slack in the meantime i'm hanging out with you here on youtube i'll be in the comments for the next 30 minutes feel free to let me know what you thought about this episode if you enjoyed it click the thumbs up we get a lot of haters that are mad at how aggressive i am on these shows but i do it so that we can all learn we have to counter those people we got to push them away click the thumbs up below to counter them and know that i appreciate your guys support all right i'll be in the comments see ya