Zenatix Solutions, a leading data-driven energy efficiency company has raised a pre-series A round of funding led by pi Ventures. The round also had participation from Zenatix’ existing investor, Blume Ventures. In addition to Blume Ventures, Zenatix has previously raised money from a group of prolific angel investors led by Rahul Khanna (Trifecta Capital), Rajan Anandan (Google) and Snapdeal co-founders, Kunal Bahl and Rohit Bansal.
Zenatix was co-founded by alumni of IIT Delhi, IIM Ahmedabad and UCLA – Rahul Bhalla, Vishal Bansal and Dr. Amarjeet Singh. It uses advanced machine learning based models and delivers 10 to 30% energy efficiency to large commercial consumers of electricity. The models are built by collecting and analyzing more than 30 million of previously unseen (“dark”) data points every day from electrical assets. These models allow for automated and intelligent controls along with predictive and preventive maintenance of these assets, resulting in consistent and comfortable consumer experience in retail and banking sites while delivering high energy savings. Zenatix aims to address the energy efficiency problem across a range of customers and eventually help grids turn smarter. Their first solution (“WattMan”) addresses the problem for large retail chains and banking/financial set ups. WattMan is built over a scalable Internet of Things (IoT) stack and includes robust connected hardware developed in-house by Zenatix through extensive research and development.
Given the distributed nature of retail/banking set-ups (100s of thousands of outlets/branches, spread across the country), having a control over the electricity spend and providing the right customer experience at the same time is a big challenge. For example, in a Quick Service Restaurant (QSR), maintaining the right temperature in customer areas, kitchen areas and cold storages is crucial. Also, they need to make sure that all their air-conditioning, kitchen and refrigeration appliances are working optimally all the time. WattMan addresses these challenges in an automated manner through its cloud based intelligent controls driven by advanced machine learning algorithms. While it ensures the right quality of service with consistent temperature maintenance, the savings resulting from it, pays for the solution by itself. This value proposition in retail/banking segment alone will allow Zenatix to capture significant portion of more than $2.5 billion market opportunity (in ARR terms), in India and Southeast Asia. WattMan was launched in April 2016 and since then around 20 customers (large retail chains/banks) have signed up. The company aims to continue adding more customers with additional focus on scaling up with the existing customers.
“We have a subscription based engagement model – the customer doesn’t have to pay anything upfront. It is a fixed annual fee whereby the energy efficiency benefit itself outweighs the fee. Additionally, there are multiple other benefits such as improved consumer experience and ability to automatically audit the usage of electricity. Typically, the customers become cashflow positive from 1st quarter itself.” said Rahul Bhalla, Co-founder and CEO, Zenatix Solutions.
The company is currently focused on Indian market, with a plan to expand internationally over next 6-12 months. The current round of capital will be used primarily for hiring across all its functions, viz., Technology, Product, Operations and Sales. The company aims to achieve an ARR of USD 2 million and become profitable by middle of 2018.
Speaking about the company and opportunity, Manish Singhal, Founding Partner of pi Ventures said, “We are very excited to partner with a talented team like Zenatix. Their integrated approach of building connected hardware, with sophisticated machine learning algorithm to work on resulting dark data generated is what will set them apart. In India cost of electricity is same as in US, despite the purchasing power parity. Thus it’s a big space with plenty of innovation & upside possibility, given the kind of data, Zenatix is starting to lay its hands on. Current use case of Wattman is a great one, which allows them to sustainably get good quality data sets, while building deep customer value. As they amass more richer data sets, we should be able to tap into predictive insights for equipment and energy usage for their customers.”
Arpit Agarwal, Principal at Blume Ventures added “By building deeper solutions in two large sectors of Indian economy – BFSI and Retail – team Zenatix has shown an immense ability to adapt their business to focus sharply on an opportunity area. Relying on humans for control, maintenance and surveillance is the harsh reality of business in India. Not only does it give rise to wastage and non-compliance, the businesses are unable to ensure consistent consumer experience, especially in B2C environment like ATMs and retail stores. Zenatix changes this paradigm by making the devices themselves smarter, greatly reducing the need of human intervention. We strongly believe that the solution is set to become the de-facto infrastructure for any business that cares about its costs or consumer experience.”
Rahul further added, “One obvious solution for solving world’s electricity problem is to increase the generation capacity. However, since the demand for electricity is increasing much faster than the supply, only sustainable solution is energy efficiency. Zenatix is committed towards delivering data driven energy efficiency with the aim of building a sustainable planet. We are now at an inflection point in our journey. We worked hard in 2016 to streamline our product offering and value proposition. We now have a strong base of almost 20 customers, each of whom have a very large presence across the country. The money can now be used to expand the customer base and deliver additional value from the product in an automated fashion.”