EDGENeural AI Pvt Ltd Revenue & Funding (2023)

[00:00] Hey, folks. My guest today is Sarvesh Devi. He's the co founder and CTO of edgeneural dot ai, a software engineer, designer, and architect. He obtained a master's degree in computer engineering from Syracuse University in New York. He has experience spanning over twelve years in designing complex products and developed more than 100 edge AI models in technological areas like driverless cars, robots, and filed six plus patents in the field of autonomous vehicles. Sarvesh, are you ready to [00:24] take us to the top? [00:26] >> Sure. Yeah, I'm up for it. [00:28] All right. So the URL of the website, if you want to follow along is edgeneural.ai. What are you building and who's buying it? Who are you selling to? [00:35] >> We are building a platform, software defined platform, which basically works for facilitating development on AI models on edge. And our customers are more or less developers and enterprise customers or users who are going to use this platform to build AI models for edge devices. [00:58] Can you give us an example? Can you name any of your maybe enterprise customers who are paying you today? [01:03] >> I mean, we have many of them. I wouldn't name them, but basically they are some of the customers which are AI companies who are building models for cloud cloud these days or cloud solutions these days. And they would want to deploy or put their models, AI models on edge. And they are these are our customers. They will be using our platform to hold those models. [01:25] Got it. And what are customers paying you on average to use this technology? [01:30] >> So we have a different way to cost in terms of pricing the customer. We charge a license base to use this platform and we also charge [01:46] >> per model per device basis when they've been the model actually gets deployed on the edge hardware. [01:54] So so the the I understand the model. The question though, I'm trying to understand, are you doing like SMB work, mid market enterprise? What's the average customer paying per month on this per license per model per per device? [02:04] >> So typically for licensing, they they would pay around $600 a month. Okay. For to use this platform per user and to deploy the models on actual hardware. It's a $10 per month per device. [02:18] Oh, interesting. And can you give my audience a sense of like what that device might be? Can you name some that they might be familiar with? [02:24] >> So the name name could be like as small as Raspberry Pi or Jetson Nano or Jetson Xavier, Intel Movidius, Intel Movidius Sticks, Xilinx devices, Qualcomm devices, and so on. So all Robotics, RB5 platforms. [02:43] So 600 per seat to just use the technology and then $10 per installed device. Is that $10 per device one time or recurring? [02:50] >> Recurring. [02:52] Recurring. Okay, interesting. So if someone uses it deploy on a Raspberry Pi and they wanna keep using that Raspberry Pi and the tech that they built with your tool, they'd have to keep paying that every month? [03:01] >> Correct. [03:01] Okay. Very cool. Give us more of a background here. When did you launch the business? [03:06] >> EDGENeural is started around like early twenty twenty. We officially formed the company in late twenty nineteen. But we started in 2020 and that's when the COVID hit us. So we started probably like around one and a half year ago. The platform idea that we started developing was kind of got out of our previous experiences so far and it started a year back. [03:35] I understand. Okay. And who is we? How many founders? [03:38] >> We are two founders. [03:39] Two founders. Did you guys just split equity fifty fifty at the start? Yes. You're a nice guy. Yeah. [03:49] What is the other who what's your partner do? [03:52] >> So I am a CTO and he's a a business he's looking into the business. So he's a COO or CBO, you could call it as. He he looks after the business part of it, and [04:04] I'm looking after the technology piece Do you remember how you guys got your first customer? I guess that was gonna be last year. [04:12] >> Yeah. I mean, I think currently our customers are all reference based. We are either getting it through our previous connections or our reference connections or the connections which we whom we are referring, got referring to. And that's how we are getting our customer. [04:29] And did you guys boot did you bootstrap the business or have you decided So to raise [04:33] >> we did bootstrap for first year, but this year we closed our first round, first seed round in June 2021. Okay. [04:41] And how much did you decide to raise? [04:44] >> I mean, right now the amount we have kept it undisclosed. [04:48] Oh, is this just recent? [04:50] >> Yeah. Just recent. [04:51] What's the advantage keeping a number like that undisclosed? I mean, don't you want to put out headlines to attract better talent, better customers, etcetera? [04:59] >> I mean, we would want to I mean, we have specifically made it undisclosed. We would want I mean, we have I mean, to be very honest, we we raise a small round just to launch our product. But now [05:12] Like, like, like, under 1,000,000, Sarvesh? [05:14] >> Yes. Under 1,000,000. [05:15] I see. Okay. So it's like an angel friends and family round, couple 100,000. [05:18] >> Yeah. Correct. So and then, we are soon going to launch our next round, within next four to six months. [05:25] Mhmm. And how much do you plan to raise there? [05:29] >> We plan to raise between 5 to $10,000,000. [05:31] And and why is that the right amount? What will 5 to 10,000,000 help you do? [05:36] >> Basically, would want to what we are trying to build is a is a niche problem and complex AI problem. So we would want to have our product mature. We are not just building a product, but we are also partnering with various companies. So we would want to have our sales team grow. We are also trying to switch our India office to US. So that is where we that's that's the step that we are taking in. So [06:02] >> that is why we would want to raise our next round, like a big amount than than what we had previously. [06:09] And and how much revenue do you think you have to do to be able to go raise five to ten million bucks? [06:14] >> See, currently we have pre revenue. We would expect to go some revenue this year again, like just with the beta customers and not with like just a referential customers, I would say. But in men, two to three years down the line, would see a revenue of around $5,000,000 [06:33] Well, yeah, but what do you want to go raise 5 to 10,000,000 like fairly soon? What do you think you have to get revenue to before you go raise that round? [06:42] >> I mean, that revenue is going to be very small. Would expect for a year or so will be like a very small revenue of $50,000 [06:51] So what story are you going to tell in that seed deck to go raise 5 to 10,000,000 basically with no revenue? [06:59] >> See, as I said, right, we are a developer ecosystem or eco centric company. We build utilities or tools for developers to utilize. So it's a highly deep tech product. The ecosystem that we are in is also niche. It's not mature. So right now, even today, now, we have to much like make sure our customers learn why the product is needed. So we have to kind of How do [07:29] you measure that, though? I mean, the ultimate measuring stick of that is do they pay for it? Is it so viable? They're willing to pay for it. No one's paying for it yet. So how do guys have confidence you're building the right thing? What metric are you tracking to build that confidence? [07:38] >> We are working with a bunch of customers with a POC. So for few of the customers that we had to run the POCs, we had to improve their performance in terms of model and efficiency. And we had to prove that their model could perform better if we if [07:55] >> they use edge AI app studio platform. [07:57] Are those paid POCs? [07:59] >> Some of [08:00] >> them are partial paid POCs. [08:02] I see. How did you structure? I mean, obviously every Founder like, you know, starts with POCs. How did you structure the contract value on those POCs? [08:12] >> Based upon how much time we are going to spend on that. That's the only value that we added. Earlier, the POCs were were free. I mean, we were we wanted to prove the value of platform and that's where we kind of made the POC, understood the timelines that we we would spend to make this POC happen. And after that, once that is done, we would basically use that time and to charge our next customers for POC. [08:40] Are any of the paid POC's paying you more than $10,000 to prove out the concept? [08:44] >> No. [08:45] Okay. Interesting. So how do you you said earlier that you're going to charge $600 per seat and then $10 per device. How do you know that pricing is going to work if no one's paying it yet? [08:56] >> So we are currently in talks with few of the customers. They are not paying customers, but they are going to soon going to be converted to a paid customers. And that is a plan that we have kind of put in front of them. And that is how we are evolving in terms of our business plan and how, what price structure is good to number at. [09:16] So you showed this to them and they said, yes, I'm willing to pay. You just haven't captured their credit card yet and actually moved them to paid. I see. Okay. What's the team like today? How many people? [09:25] >> So we are nine member team and split between technology and business team. [09:31] How many engineers? Sorry? How many engineers? [09:36] >> All of them are engineers. [09:38] Yeah. All nine engineers. Very cool. And when are you officially turning on the paywall? Mean, you know when you think you'll have your first paid customer? [09:47] >> Soon, in a month or so. [09:49] In a month. Okay. So before the end of the year? Yes. Okay. Does it make you nervous that you don't have any paying yet or are you guys are on track? You're on plan. [09:57] >> We are not at all nervous. And I would think that the, as I said, right, this is a developer ecosystem. If you're trying to sell something on to developers, it's very hard to hard sell, I would say. So that is why having no, no revenue is, is not a nervous moment for us. It's a kind of challenging moment for us so that we are making this product a healthy product for developers and edge ecosystem to come. [10:26] And Sarvesh, how much have you guys spent so far to build the MVP to where it is today? Are we talking like $10 or a $100 or more? [10:32] >> I would say of not 100 grands, but between 10 grands to 100 grands. [10:39] Okay. And so how have you kept costs low? I mean, nine engineers for thirteen or fourteen months of work has got to be more than a $100 to build the MVP, right? [10:50] >> Not, not that much. I mean, we kind of, we started, I mean, me, myself started coding from day one. So that is how I kind of, we kept the cost low, bootstrapped ourselves. So we, we had our own $30,000, $40,000 of bootstrapped on our own. [11:07] Oh, so you put in 30,000 of your own money? Yes. Oh, I see. Does that make you nervous or that excite you? [11:14] >> That does excite me. I mean, because [11:18] >> having our own money and putting that and then building something out of my own pocket, it does sound challenging and exciting. [11:26] Sarvesh, I don't know. Is that meaningful for you? Is that like all of your savings? You have to make this work? You're all in? [11:33] >> Yes, all in. [11:34] He's all in guys. You heard it here first. Good stuff, Sarvesh. Listen, we're rooting for you. In the meantime, let's wrap up here with the famous five. Number one, what's your favorite book? [11:48] >> Don't remember on top of my mind, seven habits of highly effective people. [11:52] Number two, is there a CEO you're following or studying? [11:57] >> Elon Musk. [11:58] Number three, what's your favorite online tool for building EDGENeural? [12:04] >> VS Code. [12:06] VS Code? [12:07] >> Yes. [12:08] Number how many or four, how many hours of sleep do get every night? [12:12] >> Sorry? [12:13] How many hours of sleep do you get? [12:16] >> Six hours. [12:17] Okay. And what's your situation? Married, single, kids? [12:20] >> Married. [12:21] How many kids? [12:22] >> Two. Two. [12:23] Okay. And how old are you? [12:25] >> I'm 38. [12:26] >> 38. [12:27] Last question. What's something you wish you knew when you were 20? [12:31] >> Would have started a startup when I was 20. [12:35] Guys, he's all in. Wrote the first line of code in 2019 for EDGENeural. Got going in 2020 with a bunch of paid POCs. No paid customers yet, but they are on their way there. They're gonna charge $600 per seat and then $10 per installed device. They've raised a couple $100,000 in a pre seed round. He's put in $30 of his own money. So he's all in. Team of nine, hoping to go raise a seed round of [12:54] 5 to 10,000,000 here in the next couple months. We'll see what happens. Their first paid customer should be on board here in the next thirty five days as well. Sarvesh, we're rooting for you. Thanks for taking us to the top. [13:04] >> Thank you. Thank you, Nathan. [13:07] One more thing before you go. We have a brand new show every Thursday at 1PM Central. It's called Shark Tank for SaaS. 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. 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