Making diesel generators more efficient, LoudCell ramps up operations in India and expands to Africa
Ramesh Gupta, a veteran in the field of telecommunications and enterprise software, started LoudCell along with Ashish Srivastava back in 2013. The proposition was simple – diesel generators across India are very inefficient and LoudCell had a solution via which factories could have a lot of money by making their generators more fuel efficient. Validating their idea, LoudCell could make generators up to 25% more efficient and on the basis of this initial success, the company which is a part of the TechSparks 2013 batch, raised a $1 million seed round from IAN in 2014. The funding has thrusted the company forward and it is a 45 member strong unit right now with strong future prospects. Here, we get in a conversation with Ramesh to learn more.
YS: A lot more seems to be happening at LoudCell. Can you give us a quick snapshot?
RG: LoudCell has had tremendous success in the markets it has ventured in since we got the seed funding in November 2014. We have penetrated a number of industry verticals such as retail chains, hotels, educational institutions, plastics, automotive, IT, real estate to name a few. Our sales orders have increased exponentially from a few systems before seed funding to hundreds of systems per month in September 2015. Our customers include leading brands in India such as India Bulls, Bharti Retail, Vishal Megamart, Kailash Hospitals, HCL, Airtel, Spark Minda, etc., and several SME businesses. Our sales today are nearing a run-rate of about a million dollars on an annual basis.
We have also started exports to Africa through a local partner and have seen a very positive response from there as well.
On the product development side we have developed a dual SIM based device to provide redundancy in network coverage. We have also developed an android based mobile app using which the customers can now access the dashboard on their mobile devices. We are continuously building on our advanced data analytics platform to offer enhanced value and delightful experience to our customers.
YS: What is the core business right now? Which sectors are you targeting?
RG: Our core business continues to be in the IoT space where we are addressing the diesel generators vertical as a starting point. We have emerged over the short period of time as an end to end solution which gives complete visibility on fuel usage and reconciliation at the customers premise, along with the energy generation and consumption reconciliation. So we offer a comprehensive, full stack solution of diesel and energy consumption. The business intelligence provided by our solution offers tremendous value in terms of enhancing operational efficiency and reducing energy/diesel wastage (plus pilferage).
We are targeting the industrial users and organisations that have DGs of capacity greater than 40 KVA up to several thousands of KVA. DGs are used across industries and since our solution is industry agnostic, we offer our solution to multiple industry segments such as manufacturing, commercial and residential buildings, large enterprises, institutions, etc. Recently, we have started trials in the telecom sector as well as dialogue with OEMs. Our dealers are targeting both the SME as well as large enterprise segments.
YS: Which parts of India is LoudCell most active in? Give us a sense of the traction overall.
RG: Our focus initially was Delhi/ NCR. Our customers who are based in Delhi/NCR have plants/establishments across India and so with our customers we have expanded to whole of North and East India. Our exports currently are limited to Nigeria in Africa.
Recently, we have started installations in Bangalore and are now looking at expanding in South and East India.
YS: How big is the team? Are you looking to raise more funds?
RG: Our team has now grown to a size of 45 people. We have moved from our initial office in a basement in Gurgaon to South Delhi, where we have expanded team in two offices (in neighbouring buildings). One office is dedicated for manufacturing, operations, and sales team, whereas the other office has the engineering and the support function.
We are now at an inflexion point and the tremendous market acceptance and success has encouraged us to scale up further at even a faster rate. In order to do that we are planning to raise Series A funding and have actively initiated discussions for the next round of funding.
YS: Can you throw light on some of the learnings from the space.
RG: Over the short journey we have had of active business growth, there have been many learnings:
- We had proposed two business models – the capex based outright sales of the systems and the subscription model. We found that the subscription model has higher acceptance. This is good for us as well as we are able to sign up long term committed contracts from the customers and get predictability in our revenue stream.
- We have found that there is significant operational wastage in both power generation as well as consumption along with the diesel wastage. Our solution has delivered on its promise and we are seeing a strong desire from the customers in controlling this wastage. Customers love the flexibility, ease and detailed analytics that our cloud based architecture provides.
- The customers are very tech-savvy and demanding. We have built many features and data analytics for some of our key customers who want more and more intelligence from our solution. They are not hesitant in investing in a new solution by a startup so long as it provides them the detailed and accurate information 24X7.