Beginnings of building a global connected-cars company
In the past, I have launched a number of M2M / Telematics products. For instance, my team developed a tool for tracking people that is used by professional detectives. Another tool was dedicated for dog owners - it is a GPS tracking solution used by hunters. The next tool is particularly interesting because it fits the mainstream of the Internet of Things. It was a simple device and iPhone app for smart-home. I was hoping that we would enable the masses to install a cheap and smart solution in their homes and one day, an intelligent house will become a commodity. There were also a few products related to the fleet management market and connected cars.
Some of those products failed because of a misplaced value proposition or simply a lack of cash. Some of them still operate, generating revenue streams. What they have in common is that none of those products ever went viral. They are still local businesses with no prospect to conquer the world (in as positive meaning as that can have.)
I realized that the whole Telematics industry works that way. There are no global players (like Apple). There is no on-going market consolidation. The whole global market is extremely fragmented and Western Europe is a perfect example here. There are a few local Telematics companies in every city over 300k citizens and it is not a joke. Some of them aspire to be a significant player in the domestic market but most of them never go into scale. When I investigated other markets in Europe, South Africa, South America or India, I found out that the situations are pretty much similar. Of course there are smaller and bigger companies like anywhere else. But the bigger ones are not actually that huge. They are just one of dozens similar solution providers. And the saddest thing is that big companies are very old, like 20 years or more.
I started wondering - why is it so difficult do grow fast? Why does it take some much time to reach 5k customers? Why this business never goes viral? What is wrong with this market?
The answer I’ve been waiting a long time to find is very complex. First, the internal relations with suppliers are often difficult compromises, combining low quality value with harsh terms of agreements. It affects everything, including the GPS-tracking hardware and 2G/3G data transmission via domestic network providers. Fleet management services providers have to make painful deals with telecoms in every single country. Another thing is the fact that seemingly no one in Telematics and the M2M industry cares about the product design and user experience. Take a look here: http://bit.ly/155HpS8. In the best scenario, the enclosure is “designed” by one of engineers. In the worst it is a universal 1$ housing. What is wrong with those people?
Their reality is quite sad. Telematics companies have their hands tied and spend most of their time on conflicts with suppliers. Growth is slow as the founders can’t properly work while handcuffed.
There are many more examples of how the industry of fleet management solutions actually works and what it struggles with. I strongly believe that in order to build a huge Telematics company with exponential growth, one has to overcome every single one of these issues. This is why we decided to build Cloud Your Car. We are here to change the market once and for all.
