Sramana Mitra: How did you get the company off the ground? How were you acquiring customers? What was the genesis of the story?
Marius Hanganu: For years, it was a Sequoia-based startup. Before it came to be known as IoT, it was called Big Data. The technical challenges around it are quite amazing. It was about custom hardware. It was about the portal. Back then, it was a solution designed for Nokia. It involved some embedded pieces of work.
Someone could wear a backpack and walk around a concert. You could get a message on your phone saying, “Turn your Bluetooth on.” Then you get a catalog. That was the solution. It was deployed in bus stations and in other public areas. That’s how we got our first customer.
Sramana Mitra: Did you continue to work in this mode of doing backend services for Silicon Valley startups?
Marius Hanganu: Yes, that was our main market for several years. In the 2007 to 2008 timeframe, we also experienced the crisis in the sense that we lost our largest customer. That year, we didn’t grow, but we didn’t go down. It was a steady evolution over that year. We started diversifying our market base to Europe. From there, it got more and more diverse.
Sramana Mitra: Does the services business continue or is there any other kind of business model that you explored down the line?
Marius Hanganu: We’ve been asking ourselves the product question all along our history. Our main problem is sales and marketing.
Sramana Mitra: But you haven’t figured out how to spin your services company into a product company yet?
Marius Hanganu: It’s a more complicated story in the sense that we have built 10 smaller websites that had some local exposure, but in order to have international exposure, we had to invest a lot. If you invest $100,000 to build the technical part, you should be prepared to have a million in sales and marketing.
Sramana Mitra: Not necessarily. I don’t often agree with these rules. Where are you revenue-wise right now with the services business?
Marius Hanganu: We are 95% from services.
Sramana Mitra: Is it $5 million a year?
Marius Hanganu: Last year, it was over €5.5 million.
Sramana Mitra: You have profitability to be able to set aside four or five people to start a product effort?
Marius Hanganu: Which is exactly what we did last year. We started building our own product. It’s an IoT business orchestration platform.
Sramana Mitra: You are working on a product?
Marius Hanganu: Yes, we saved up to have a team of five – exactly the number you said.
Sramana Mitra: Great. Thank you for your time.
This segment is part 2 in the series : Bootstrapping From Romania: Marius Hanganu, CEO of Tremend