CerebrumX Revenue, Valuation & Funding (2024)

guys they charge insurance companies uh aftermarket companies uh and and you know uh connected Fleet companies uh anywhere between seventy thousand hundred thousand dollars per year seven customers today they just started selling five months ago already at a 600 000 run rate it's like the end 2022 at a 1.2 million dollar run rate they're basically giving all this 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 Runway though to continue to drive growth hey folks my guest today is Sandeep ranjani is the CEO and co-founder of cerebrum x a company that focus on unlocking the value of con the connected vehicle before joining the company served as the SCP and GM of automotive service business unit at Harmon International leading the connected Automotive Cloud aftermarket OTA and cyber security businesses over the 28 years of experiencing automotive and communication industry he's extensive experience in creating and successfully launching secure cloud-based iot services that enhance the experience and contribute to sustainability aspects some deeper radio tickets to the top very cool wait I want to make sure people don't get lost right cerebrum x dot AI is an AI powered connected vehicle data platform what does that mean so uh what we do is when we get the data from the vehicle uh we processes 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 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 that whole model is kind of just below how do you get the ability to collect the data from the car in the first place are you working directly with Ford and they put you in every Truck Yeah so we work with the top uh four volumes minus GM right now in North America so we're using the top the top five minus GM minus GM right and so who are those for the name name the other ones yeah so you you can you can guess it right out of the five in terms of the sales right so minus GM all the four right uh and and 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 for example food uh uh you have stalantis uh Nissan and then we talk about the tutors okay so yeah so walk me through I 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 concentrate so typically what happens is that say that you are part of Fleet right the Toyota vehicle Ford truck is part of a free trial so what will happen is that once you give a concept that I am okay to share my data that comes and gets passed on to the oems right it's on deep though I imagine you've got it installed during the manufacturer 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 modern building just like your mobile phone every vehicle already has a has a bottom which is already predicted so from from the perspective of enabling the data that already exists so that data already exists right so what what is happening is that once you give a consent that data gets sent to the cloud and then it gets handed over to server Max 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 let's say that if you take a specific example of let's say a four okay let's say that's for example you are looking for uh Insurance deal right you're looking at an insurance and you go to one of those insurance providers right 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 the 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 evaluation 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 evaluations inside of your founder 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 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 raise they sold 22 percent of 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live right inside the platform I hope to see you there all right let's jump back into the interview well who the problem is is my audience has to know when you use the word you they don't know what you means who is you also as end consumer right when you're a consumer like Mr Newton says well I need to get an insurance and what you do is you go to one of the like like a guy who'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 uh on the portal and what will happen is you would say that yes I am ready to share my data so that information from the likes of the insurance companies like Geico Etc comes to us and from that consent what we do is we pass that on to food 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 the insurance companies okay so so I as a consumer go to Geico I say yes Geico you can get my data that notifies your Hardware your application in my Ford truck you pass my speeding or you know stop sign data to Ford then what does Ford do with it so four four doesn't do four four does uh only concerned about your consent they're they're really particular whether if the data they're passing on the concept is there or not So based on 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 uh 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 I think everyone understands that I'm trying to understand the information flow so you're you're who's paying you Ford Geico or the consumer uh it'll be coming in from the Geico site or or any of those insurance okay so you're not when you say you work with a top five minus GM that's just you're that's not those are not your customers your customers are Insurance yeah 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 feed companies the feed providers like azuga which is part of Bridgestone or or their aftermarket companies okay so those are the people who are paying sorry name an example name a couple other examples of Fleet companies that pay you for example Bridgestone Mobility right I'm sorry I say that slower bitstone mobilities okay so you're saying it you're saying it fast and I can't understand the company you're saying so bit storm bit storm b-i-t-s-t-o-r-m b-r-i-d-g-e Red Storm Bridge Bridge Okay bridge bridge storm Mobility yeah so Bridgestone uh uh they have their Mobility which is they have a fleet division which is azuga a-z-u-g-a got it so so typically what will happen is that uh azuga would come to us and say well I need data from let's say uh stalantis way right so for example okay so what we do is we go and tell stalantis that this is what consent which we have the constant gets passed on to stellantis and then stalantis enables those sorry I don't know what's how does so there's Bridgestone there's Bridgestone Mobility Fleet and there's azuca inside of that Fleet so what is so so stalactus is FCA uh it's an FCF Fiat Chrysler so oh it's a type of car no it's it's a company right stalantis is a company which is Fiat Chrysler plus PSA got it this was a new nomenclature which which happened I think the whole budget happened in 2020 right January 25 so oh yeah yeah this is a car brand it's you know they own Chrysler and Fiat yeah so now let's say that uh they have a ram truck like Ram 1500 right and 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 right their vehicles which are the Ram trucks right that's what you could try you're tracking Ram trucks right they give us a consent yes I think it's okay legally all right to to really get the data for these damn trucks that information gets passed through the car manufacturer in this case it's galantis and once it gets that data that that full confirmation they start giving you the data out right so that that's the whole process in this case so guys Maya sorry just to be clear just for everyone listening azuga is a company owned by Bridgestone that allows you to upgrade your fleets with their GPS tracking software and dash cams it sounds like Sandeep you are built into that software module yeah so so what will happen is right now that company is using some other mechanism to track the data there is a 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 okay you replace that yes we replaced that so understanding now becomes natural because it is understanding from the vehicle itself okay so again I want to make sure to 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 yeah it is more like an aftermarket uh warranty companies uh there is a company exam connected a-x-i-o-m exam connected interesting um okay cool very cool okay and then give me an example but I want to get your back story here but before we do that what does the average customer pay you per month or per year to use this technology so so typically you get an average revenue per per vehicle it goes somewhere between uh 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 it costs new customer signs up for you how many vehicles are they usually managing five ten 100 a thousand so so typically most of these customers they have more than 100 uh key kind of vehicles right these feed companies they have hundred thousand plus Vehicles right if you look okay so if someone's signing up for you to manage 100 vehicles at 70 bucks a year that's a seven thousand dollar per year contract that's your sweet spot so that that's that's how 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 seven thousand a year for a hundred cars yeah for 100 cars but we're talking about 100kways it's not 100 cups we are talking about hundred thousand Vehicles right each of these feed companies for example azuga has hundred thousand Vehicles so Sandeep I understand that I'm asking you when they pay you are they typically paying on average for a hundred cars at 70 bucks a year or a hundred thousand at 70 bucks a year what is your sweet spot so our sweet spot when it starts within something around thousand Vehicles two thousand fifteen thousand that's that's what we start with that's then we scale up okay so that's like 70 grand to that's like 70 240 000 a year something like that so that's that's what it's typical customer would start with somewhere around uh 70k to 140 120k kind of distinct I see and then you have those multipliers like in terms of more customers and in terms of really they scale up Etc and so and so forth let's put this on a timeline when did you launch the business what year so we started the company in July 2020 and our product was up and operational in uh June 2022 this year that's when the product was operational where we started integration with this thing so right now it is roughly around four months okay and how did you pay for your salaries and stuff I mean there's two years there where you have no Revenue no but uh I think initially I think the company were bootstrapped by the founders itself like we are four Founders who bootstrap the company for uh close to nine months or eight months that's what we bootstrap and after that we went for series a so we were lucky to really get a series Way by March 2021 we closed our series it how much was that for so that was five and a half million four and a half five and a half five and a half interesting and when you re most folks you know when they're raising a series series a last year they were selling sort of ten to fifteen percent of the business were you sort of in that same range yeah I think that's that's what it is yeah okay fair enough so I mean but you're raising it like a 30 to 50 million valuation pre-revenue really right yeah so I think uh uh that was a good part because most of the companies uh uh uh I think who live like some a couple of our other companies I think they were valued at 1.4 billion right the companies were in the similar segment right like who name a couple yeah there is yeah Oto n-o-n-m-o autonomo oh oh who has an orange o t o n o m o o t o n o m o yeah so I think their market cap is pretty high when they went public right so again at that point of time I think uh this was one of the red I would say a pretty hot in that in that sense right so I think we're lucky to agree uh we were there at the right time and within nine months we close our series okay interesting and then fast forward to today how many customers are you working with right now we have uh seven customers okay right now and as I mentioned uh one of them is uh the I would say uh top three insurer in North America that's one I talked about uh azuga then you have uh exam connected oh azuga is a customer yeah amazing amazing so but if you've got seven customers paying an average hundred thousand bucks a year you guys just broke about a 700 000 run rate right so yeah so we will close uh so again as you the ARR which will close this year will be close to around 1.2 million but what are you at what are you at today though in terms of run rate uh our run rate right now is roughly around us uh 600k as an AR right now okay so you think you're gonna double your AR in the next 60 days uh yeah I think because at Sea it's about really onboarding the vehicle as soon as you on board a fleet the fleet itself becomes let's say that you're onboarding thousand vehicles or so right so that's that's the kind of model it is okay and if you're doing 50 000 a month today in Revenue which is a 600 000 run right what were you doing exactly one year ago were you pre-revenue yeah as I mentioned like we went into production uh uh in June 2022 so yeah it's just uh roughly around four months when we are into production right that makes sense that makes sense talk to me about your team how many folks are on the team today so we have uh 39 people 36 are permanent three contractors uh sorry 36 or what 36 permanent members and three contractors full-time ah 36 got it and how many are engineers so uh roughly around 28 are engineers 29 28 28 okay 28 engineers and um how have you I mean obviously now we're in a bit of a period you raised in the Heyday last year 5.5 million right you grew your team pretty big right 36 employees for 600 can revenue is very small Revenue per employee how are you thinking about managing your burn in you know a crazy economy yeah so I think that's a good question like in terms of burn uh most of our development team is in India so what we have done is uh we have kept the sales and marketing in in U.S While most of that pre-sales in U.S While most of the development is in is in India so typically I think our burn is close to around 150 to 180k per month so so I think that's your net your net Burn yeah yeah so our our again we're pretty conscious about that and as the revenue starts kicking in so I think that's where I think you start getting a lot of that starts getting offset and I imagine you still have a lot of you should have a lot of the series a still in your bank more than three million in the bank right yeah yeah so we have it yeah yeah so you guessed it right yeah yeah very cool all right um anything else you want to chat about before we wrap up no I think that's it so yeah I think pretty excited and and again the market is pretty uh hot what where we are right now but most of the cars getting connected I think uh this is going to be one of the big segments to know about look forward all right well we're rooting for you in the meantime let's wrap up with the famous five number one your favorite book so my favorite book uh is uh uh spell it Fountainhead oh yeah yeah yeah number two is there a CEO you're following or studying I don't think I'm following anybody right yeah but I just here to most of the people but nothing like in particular that you follow anybody right number three what's your favorite online tool um my favorite online tool is uh the expense management because you have to control the expenses part of which tool I use Zoho Zoho okay number uh four how many hours of sleep do you get every night how many hours of sleep uh five hours and situation married single kids doesn't matter what's good how many kids one one and how old are you uh I'm on the other side of 50 the 53 53 last question something you wish you knew when you were 20. yeah I wish I knew that uh engineering is not the end of not not not the only thing which you need to know right if business development is extremely important right I have been Savvy on the business development is guys they charge insurance companies uh aftermarket companies uh and and you know uh connected Fleet companies uh anywhere between seventy thousand hundred thousand dollars per year seven customers today they just started selling five months ago already at a 600 000 run rate it's like the end 2022 at a 1.2 million dollar 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 netburn 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 we're certainly rooting for them and we appreciate Sundeep you taking us to the top yep okay thank you very much one more thing before you go we have a brand new show every Thursday at 1pm 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 our poo CAC LTV you name it they share it and the buyers try and make a deal live it is fun to watch every Thursday 1 p.m Central additionally remember these recorded founder interviews go live we release them here on YouTube every day at 2PM Central to make sure you don't miss any of that make sure you click the Subscribe 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