Zeliot Connected Services Pvt Ltd Revenue, Valuation & Funding (2024)

hey folks my guest today is a new nike along with his partners co-founded zeliott in april 2018. he comes with experience of working with the founder very closely in his previous slim stint as an iot startup called cookie he's been fairly successful in embedding his philosophy of running a startup with the hybrid thought process i.e bringing revenue from customers by delivering value from day one and also look to raise money from a good investor but the money raised should be mainly used for bringing a new innovative product to market zealiot offers connected mobility platform to enterprises and oems and noop ready to take the top yes absolutely nathan good to go all right so what kinds of oems and enterprises are paying for your technology today so nathan as i mean you already read out connected mobility platform is something which vehicles use right it could be any kind of vehicles it could be a car or a bus or a truck or a two-wheeler whatever it is right so the typical oems who pay for us are the ones who manufacture this the enterprises segment falls under the people who use it for their own business let's say logistic companies right logistics companies have the entire business model revolves around vehicles so those are the typical enterprises who pay us for using our software and on the oem side who manufacture these vehicles let's say the likes of royal enfield for bikes right indian major indian two-wheeler famous globally as well maruti suzuki you might have heard of it right so these kind of companies who uh you know kind of typically use our connected mobility platform as part of their core offering got it so vehicle manufacturers pay for your technology so they can add connective mobility to their vehicles yes they can and what do they pay you per month on average to use your technology so that is something which differs from a customer to customer there is no standard rates right it depends on the kind of model that they they work with us typical sas costing is somewhere around a dollar or so but you can't you know really hold on to that dollar or so per what per vehicle per month per month right okay but now that differs very very uh significantly based on the kind of customers that we onboard and the kind of offerings that they want to offer to their customers so nuke do they keep paying a dollar even after they manufactured it if that car is still driving or they only pay a dollar the month they manufacture the car absolutely the subscription starts the day the vehicle goes to the customer right and they pay for the life of the vehicle i see okay do they pay for the life up front do they pay each month they pay each month i think as i said it depends it really depends on the kind of engagement that we enter into typically they pay each month as and when the vehicle is used and how many cars today are out there on the roads using your oem technology or your mobility technology so see we we come from india right zelia predominantly operates in india where connected mobility is yet to take off so currently roughly about a hundred thousand devices are using this right but the actual significant numbers will only uh you know rise as we go ahead this next couple of years is very very very important for connected mobility and so just to be clear you have with zelia installed a hundred thousand vehicles on the road today see hundred thousand vehicles are using our software and you and your chart and you charge a dollar per vehicle per month so you're doing about a hundred thousand dollars in revenue per month yes the average revenue run rate has been close to a hundred thousand dollars per month oh what do you mean the average over what period of time so see this is a subscription revenue right so when we started the last year we started roughly you know some sixty seventy thousand dollars mark and by end of the year we were able to you know close it at about a little over a hundred thousand dollars a month so just to be clear in december of 2021 this last december you hit about a hundred thousand a month in revenue so yes again a small change indian no financial year is march 2021 2022 rather right so we operate from april to march 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 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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 founderpath 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 wanna check this tool out if you wanna 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 evaluation 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 so you just hit a hundred thousand dollars a month in revenue up from 60 000 a month a year ago yeah kind of yes why kind of why not yes so the exact figures vary right that's the reason kind of let's say it could be somewhere around forty five thousand forty eight thousand right today it could be somewhere 100 and three hundred and four thousand so i'm not giving you exact figures i'm giving you the average because well it's not an average you're still giving me a range right so you did somewhere around forty eight thousand dollars a month in revenue a year ago now you're over a hundred thousand so more than more than a hundred percent year year-over-year growth have you done this bootstrapped or did you raise capital so we very very recently closed uh on our street around with bosch in march till then we were bootstrapped we have raised some debt funding debt funding of close to 150 000 all right so recently we closed uh in a kind of a seed round with robert bosch how much did you raise so around 500 000 dollars and most folks in their seat round are selling 10 to 20 percent of the business what valuation did you raise at so we sold around 14 of the business okay around 14 so that means your valuation was around 4.5 million five yes 4.5 million correct 4.5 okay got it and why'd you decide to raise equity it sounds like you already are familiar with debt why not keep using debt okay so one of the predominant reasons the kind of company from whom we raised the funding right we being mobility startup we being you know autonomous vehicle related startup bosch plays a significant role in the roadmap of the company so bosch is a global player probably the best known name in the automotive industry right having them on your capital having them as your partners gives you many much more strategic value than just money that's the reason the valuation is a little lesser than probably what we would have anticipated but it's a fair bargain because the kind of the thought process and the strategic value boss brings to the table and how and when you raise the debt financing you raised that last year uh over the period of three years okay so when did you launch the company what year 2018 april when we launched right we have taken small amount of that every time uh whenever we needed it right we have a partner company called i triangle who you know kind of supplies the telematics device or the iot devices so kind of we raised entire debt from them we did not go outside of them what collateral are they lending against the physical installation of the oem hardware or your software revenue no no there is no collateral there is an interest rate that we pay them because the money has been borrowed in small instances or small let's say intervals every time that we have never given them any collateral against us right we have paid interest over what we have raised what's the interest yes so roughly around seven to nine percent interest 79 interest rate and i guess it's i find it hard to believe you didn't give any collateral because even in the united states you couldn't get an interest rate that low without pledging collateral if i go to a typical lender let's say a bank or a nbfc right non-banking financial corporation i have to give them collateral did i triangle take warrants no because this was a partner company who we were doing business with it's kind of a partner company wherein i buy hardware from them i use it for my business i pay them harder and if i'm giving them business along with taking money upfront for my other business right so yeah so so just to be clear anoop your your collateral is the invoice with i triangle that that's that is that that is maybe you can say that yes that is the collateral they're willing to give you a 79 interest rate because you're you're their customer you're they're just forwarding their invoice factoring effectively and they are also our customer right they are also using our software for their hardware business how many customers do you have today um over a hundred enterprise customers small too large and got it and on all of those are our manufacturers of cars buses trucks how many are manufacturers manufacturers roughly 10 of them okay and so then everyone else are people like i triangle enterprises yeah enterprises like let's say i'll give you an example of um a company you might have heard i don't know have you heard of tata let's say communication large indian conglomerate right indian oil corporation a large indian conglomerate again and why would the oil corporation pay you so they have their own fleet for logistics purpose let's say transportation of oil transportation of their employees and what not so for those vehicles so they use you to install all their devices so they can track all their cars trucks shipments ships whatever yes yes not ships not ships okay cars trucks bikes stuff okay so you have about 100 customers you've got 100 customers paying average a thousand a month so a hundred thousand dollars a month you're recurring revenue um you're you've just raised additional capital you have a little bit of debt what's the team size like today how many people so as of today we are around 49 so we are onboarding our 50th employee i guess monday coming monday and how many engineers so around 35 are engineers where are you guys are they based in pune chennai bengal yeah okay what's a junior developer charge will go for these days in bangalore what do you have to pay them salary wise um this this value is increasing too high but i know uh if i have to give an average figure out of that um five lakh would be somewhere around 10 000 10 10 15 000 a year okay got it it's about 12 15 20 000 yeah yeah 1200 1200 a month something like that okay interesting so 35 engineers do you have any sales reps that carry a quota or no so we have a small team of four people right four to five sales team a sales people team the reason we have small team because we rely on large accounts which take let's say four or five months to um you know convert these auto oems or these large enterprises they don't close in a matter of days you have to do pocs you have to do a lot of stuff behind the screen so it takes uh roughly about four to five months to close so we need more of uh engineers and program managers product managers than sales so sales team just opens account transfers it to internal teams to manage and close understood and you mentioned large accounts what's your largest customer paying you per month right now around 20 lakhs would be around thirty thousand dollars twenty five so about thirty thirty percent of your total five percent yeah twenty five percent twenty five to thirty thousand dollars yeah interesting and is that just because they're managing a lot of vehicles on your on your platform so what happens is some of the customers have very very long vision right so uh they kind of manage a huge load of vehicles and the kind of analytics they use from our platform is also very very high right that is where they end up paying a larger sum of money that means the per asset cost for them will be much higher than the average of one dollar and and that's great i mean obviously you need those big customers how are you managing as you think about debt and equity how are you managing your own equity do you have co-founders or are you so founder so i have other two co-founders with me who are younger to me sudhir and sukham i guess i've mentioned their names in the bio as well right so in the bio did you guys split equity 30 each at the beginning or no um kind of we you know hold equal kind of equity i have a little more than them but almost the same so how much do you still own today around 35 i guess i cannot give you that uh figure right now nathan because we are under some clauses where the entire financial transaction financial details cannot be given out well who cares it's your who cares it's your business you own it uh what do you mean who who who would ever be able to control what you're able to say on a podcast or to any press outlet no no it's not that simple see what happens is um not all the financial transactions are given out to the public yet right so half of it is already given out like the amount of money we have raised the kind of percentage we have given the cap table of all the people is not given out because of course that's why that's why i have a podcast that's why i ask questions do you think i want to have you on and ask you questions you've already answered all day long that would be zero that'd be zero amount of interesting so you mentioned at the beginning you had a little more equity so it's something like 40 30 30 something like that yes see as i've already already told you we have given out about 14 percent right so let's say the remaining equity is divided among us and i have 10 percent 10 percent more than others together put together all right oh okay got it so what i'm trying to understand is not what you're i'm trying not asking what your equity is today i'm asking what your equity was when you started right so when you started you're saying you had 10 more than the other two combined yes okay so something like 60 40 something like that or 55 45 something like that yeah okay got it and then you raised some extra capital and sold 14 percent true yeah so i was getting there so you're a little diluted now so you're around 50 50ish percent right now 49.50 something like that but you're saying it was worth the dilution because bosh is a strategic partner that's gonna help you grow faster interesting okay very cool um any plans to raise capital later this year or you think you're good for a while um so we are planning to raise a capital as we expand see we have a very very small business in africa right as we expand geographies we will need more capital to onboard more customers right so we are going to raise the capital by end of the year that will either be pre-series a or series a kind of a deal based on the the growth that we are showing this year so we are supposed to grow uh about four x on the revenue time revenue side right we have closed the year just short of a million dollars right so this year the projection is uh we are supposed to hit around four million dollars so once we do that or once we are on the roadmap to do that we are planning to raise the capital very good let's we're out of time let's wrap up with the famous five number one favorite book um steve jobs number two is there a ceo you're following or studying so i follow elon musk number four how many hours of sleep or number three what's your favorite online tool for building as elliott typical answer number four how many hours of sleep to get every night no i'm i'm a little comfortable on that let's say about seven hours roughly seven okay and what's your situation uh new married single kids i have married i have a 10 month old kid oh wow young one congrats and how old are you so i'm about 31 31 last question something you wish you knew when you were 20. very difficult question because i've been in this for a long time but um yeah the kind of hybrid philosophy that i'm following now if i knew it let's say five years back things would have been much more different what do you mean by that the hybrid philosophy which i've already mentioned in my details right you describe it again yeah so you kind of manage you kind of focus on revenue from day one of your company don't let it slip if i knew this let's say four or five years back things would have been slightly different guys there you have it zelia dot i n launch in 2018 they create a little device which manufactures car manufacturers managers of big fleets like trucks and cars can use their device to track their whole fleet so connected mobility connections long-term data plays et cetera they've got about a hundred thousand vehicles or assets that have their technology embedded today they make a dollar per asset that's active so they're doing about a hundred thousand dollars a month in revenue up from forty eight thousand dollars a month just a year ago so 100 year-over-year growth they just raised 500 000 bucks at about a 4.5 million valuation sold 14 percent of the business with their team of 49 breaking on their 50th on monday as a noop looks to scale and look at a series a later this year we'll see what happens thanks for taking us to the top thank you thank you for the discussion thank you 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 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