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There is a full-size truck cabin in the middle of the head office CameraMatics in Parkwest in west Dublin. It is where CameraMatics, one of Ireland’s fastest-growing start-ups, show its customers its full range of fleet risk management technology in a realistic setting.
Co-founder Mervyn O’Callaghan is showing me the cab while we wait for a sales meeting to finish in its large glass-walled boardroom. The meeting is running over so I suggest we conduct our interview in a coffee shop nearby instead. As we walk, we pass the offices of Workhuman, the Irish unicorn led by entrepreneur Eric Mosley. O’Callaghan has been following their story, and over the next hour it becomes clear that he is similarly ambitious for CameraMatics, a firm he co-founded in 2016 with his friend Simon Murray.
“How did you hear about CameraMatics?” O’Callaghan asks me. Now, that is a good question.
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Just before Christmas last, American company Samsara floated on the New York Stock Exchange at a valuation of $11 billion. Prior to floating Samsara had raised big sums from smart venture capitalists like Andreessen Horowitz and Tiger Global. Founded in 2015, Samsara sells subscriptions to its connected operations cloud, which allows companies that manage vehicle fleets and industrial operations to access real-time data. On February 11, Samsara said it had passed $300 million in run-rate revenue in just five years and was growing annually by 80 per cent.
The reason why I wanted to meet O’Callaghan was that his firm is a competitor of Samsara; smaller, yes, but growing at an even faster rate. CameraMatics has developed its own proprietary software platform based on camera technology, vision systems, AI, machine-learning and telematics that is as good as, if not better than its rivals. O’Callaghan tells me his firm helps its customers “reduce accidents, be more operationally efficient, and manage compliance”.
CameraMatics has 800 customers managing small to large-sized fleets totalling tens of thousands of vehicles. “Our largest customer would have 2,000 vehicles, but we’re working with hauliers in Ireland who might only have five or six vans,” O’Callaghan said, adding that customer sizes were increasing as it expanded outside Ireland: “In Ireland, 40 or 50 fleet vehicles is decent sized but it’s relatively small when you start looking at the US market.
How quickly is CameraMatics growing? “This year I don’t have the final numbers, but we will probably see 170 per cent growth,” O’Callaghan said. “That is probably slightly higher than in the previous year. We’ve been kind of 160 per to 170 per cent year-on-year growth since we started.”
What about revenues? “This year we’ll be just under €7 million and next year we’d expect to be somewhere around €11.5 million to €12 million,” he said.
Already CameraMatics has a big piece of the Irish market. However, to succeed the company realises it has to go beyond that. During Covid-19 CameraMatics hired 40 people, taking its team to 78. It has full offices in Dublin, London, and Richmond, Virginia. It also has a team of developers in Lisbon and has just hired its first person in Dubai to target the United Arab Emirates. It is also launching in Australia using both its own team and working with a joint venture partner.
Going to the United States will bring it up against competitors like Samsara but the market is both huge and nascent. “We’re targeting the same customers, but with a different solution,” O’Callaghan said.
Would CameraMatics ever take the stock market route? “We’ve been asked already if we would consider it. But to be honest, I think the sector is too hot and there’s so many people looking at it, there is too much opportunity,” he said.
O’Callaghan said CameraMatics wanted to raise money privately instead. On January 1 O’Callaghan told The Irish Times the company was seeking to raise between €15 million and €20 million. Our conversation turns to scaling and funding.
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CameraMatics has raised €8.8 million to-date. A €4 million seed round in 2020 was led by Puma Private Equity, part of the London-based Shore Capital Group, along with existing investors Enterprise Ireland and Sure Valley Ventures. Around Christmas last year it drew down another €3.9 million from existing investors. “The additional funding wasn’t something that was planned,” O’Callaghan said. “We had exceeded where we’d said we’d be by the end of the year – and we’d had some interesting offers to acquire us.”
The money was designed to give CameraMatics time to consider its strategy. “Part of the challenge when you get these offers coming in as a founder is you think we’re only a few years into this journey and someone’s offering me enough money that you could potentially retire and not have to work again,” O’Callaghan admits, adding that some investors were looking at a return of up to six times after only six months.
Were you or they ready to take the money? “Puma’s view is not that we could be acquired for like €100 million or €200 million. They are seeing it as a business worth hundreds and hundreds of millions,” O’Callaghan said.
For Murray and O’Callaghan however, it was tempting. “We were kind of saying to them that it’s easy for you to say when you’re sitting in an office in London. We have to deliver it,” O’Callaghan said. “That’s where the additional money came in. It was them showing their commitment to the business to say we’re all going to push together to grow.”
Jonathan Wyles, an investment director with Puma Private Equity, sits on CameraMatics board, and O’Callaghan said they were in regular contact. “What the funding enabled us to do was give us a longer runway so in terms of the next fundraise we have more flexibility,” O’Callaghan said.
He admits CameraMatics remains an acquisition target even as the company immerses itself in investment term sheets. “We’re probably getting an offer once every two months from someone,” O’Callaghan said. “But we’ve got a lot of growing to do. We haven’t really pushed into the US because of Covid as much as we’d like to.”
O’Callaghan said CameraMatics now had the team in place to get traction in the US: “I’m confident we’ll start driving numbers in the US, and in terms of valuation that is really when it will come.”
CameraMatics has also brought in some experienced new hires to help it scale, including Darren O’Donohue, as chief operating officer. O’Donohue was previously CTO of Digicel’s financial services division based in St Lucia. “Darren reported directly to Denis (O’Brien), so he’s got a lot of experience of fast-growth,” O’Callaghan said.
Last July it hired Michael Menolascino, who previously worked with competitor Smartdrive Systems. He will lead its sales team in the United States and build up its sales team in Britain too. Last month Richard Moore joined the firm as director of marketing based in London, after previously working in mobile satellite group Inmarsat.
The new funding round, according to O’Callaghan, would be used to continue to enhance its product but also build out its sales and marketing team. It is also looking at making its first acquisitions in a market that, while still emerging, is also fragmented.
“We’re looking at a couple of acquisitions at the moment,” O’Callaghan said. “We are looking at a couple in the UK and we’re looking at joint ventures or strategic partnerships as well there.”
Is CameraMatics looking to buy technology, or people, or customers? “Probably what we’re more focussed on at the moment is what we term connections, so customers and vehicles,” O’Callaghan said. “So, live devices on the network. Someone that’s signed up for a contract or some type of service. What we’re seeing at the moment is we’re winning business by transitioning companies from older technologies to our solution. We’re interested in anywhere we can buy an existing customer base.
“There’s another acquisition opportunity that we’re looking at that will actually expand our product offering.”
CameraMatics is focused on the commercial fleet market but he said it could move into the consumer vehicle market too. “We’d always planned to do that maybe late this year or early next year,” he said. “But there may be an opportunity to fast track into that sector quicker.”
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Mervyn O’Callaghan said a difference between CameraMatics and its competitors is that it was more software than hardware driven. “With everybody else they’re very much hardware driven. It determines what you can and can’t do. We’re coming at it from the opposite direction,” he said. “We’re also looking at a lot more integration with the vehicle itself and the vehicle manufacturers to pull in data. We’re building in such a way that as we release new features and functionalities, we can deploy it to existing customers.
“Where we stand out from everyone else is our roadmap for the product and our ability and flexibility to roll out solutions to futureproof our technology.”
Driver safety is a priority for CameraMatics. It can give feedback to drivers and fleet managers both inside and outside the vehicle. “We want to prevent accidents from happening,” O’Callaghan. “Rather than a lot of the companies out there who think it is just about having a video to replay if something goes wrong.”
Inside the cabin, CameraMatics can identify if a driver is tired and needs to rest or if they are looking at their phone while driving. It has compliance functionality too like checking if tires are at the right pressure and so on.
O’Callaghan said the firm was conscious that professional drivers could be concerned about privacy, so it’s in-cabin cameras could be set to turn off when vehicles stopped moving. “There are lots of different configurable things we can do,” O’Callaghan said. “It’s very much a driver aid first. The data all comes back to a central platform too for the company to look at and identify trends and improve efficiencies like fuel consumption.”
O’Callaghan said CameraMatics was one of eight companies accepted into Accelerate Green, a new scaling accelerator for innovative green companies being run by Resolve Partners and Bord na Mona. He said CameraMatics could play a role in reducing fuel consumed by trucks.
“It’s all sorts of things,” he said. “From general driving style initiatives to things like… we have an integration for bin trucks that can tell if they’re compressing the rubbish more often than they need to use up fuel.”
O’Callaghan said in Britain and the European Union legislation was going to drive trucks towards using technology to drive both more safely and greener.
“We’re talking to a number of state bodies about running pilots to show them how technology can make a real impact,” he said.
Driver shortages, he said, were lowering the age of new drivers. In Britain there is an estimated shortage of 50,000 drivers. “You’re going to have more inexperienced people driving. In the UK there are intensive training courses to get your HGV (heavy good licence),” O’Callaghan said. “They’re going to need as much technology as possible to make them safe drivers.”
“Insurance companies are another driver,” he said. “We have a number of insurers who won’t ensure a fleet unless they have our technology.”
“The opportunity is huge. It’s really up to us to take it up,” O’Callaghan said. “We know our technology is better, but we have to get in front of customers as quickly as possible to win the deals.
“From an investment perspective we’re probably looking at bringing in US investors to help with our US expansion.”
Is €20 million enough? “I would say that when we get to it, the amount of money will probably be significantly higher than €20 million,” he replied.
“We’re talking to different VCs and different private equity in the States. Andy (Amos) our Head of Finance has been having at least one or two calls a week with them.
“This year is critical for us. If we can do 160 per cent growth on our revenue this year it will enable us to raise considerably more.”
“We can demonstrate that we’re winning deals against the likes of Samsara. They raised $3.9 billion…and we’ve been able to beat them. Right now, this is all about scaling.”
