richard begley
huntington, WV (USA)
Role(s):
Founder/Owner/Principal
InSenSys
Find More Startups
Startup
Location:
huntington
Industry:
Transportation
Year Founded:
2006
Number Employees:
10-50 people
Description:
InSenSys, is an abbreviation for Integrated Information/Sensor Systems and is the name chosen for a relatively new start-up company that evolved from a multi-year and multi-million dollar railroad engineering research program at a local University. InSenSys is currently owned by two University engineering researchers that developed a cost saving satellite based railroad surveying technology through their research over the years. The same individuals have exclusive rights to market and sell this technology through a licensing agreement from the University and are also in the attractive position of having a well funded ongoing research program in addition to access to significant railroad industry and business development expertise through their affiliation with the University.
As an example, a major railroad company has recently guaranteed future railroad surveying services of approximately $200,000 to stand up the railroad mapping service by InSenSys with practically no marketing costs incurred by InSenSys. And the same railroad company has also just committed over $100,000 to be combined with $286,650 of federal funds, recently secured by the University researchers, to help evolve the mapping technology into user friendly technology for track inspectors. (A high-school education is the norm for track inspectors and current techniques rely heavily upon repetitive visual observations)
InSenSys would ultimately amend their current licensing agreement from the University to include the new technologies and expand the business model from a service provider to building, leasing and maintaining 100’s of portable track inspector hardware and software tools/units. User acceptance for the track inspectors’ technologies is guaranteed since the technology development is being guided by end customer experts at the R&D stage. The current advisory team from the railroad company includes, but is not limited to the Director of Track Inspection and Testing, Director of Advanced Engineering, and a Director of Technology. And the price points for the new tools have already been proposed and accepted by the end customer and used in the financial projections summarized below.
The InSenSys business plan asks for $4.5 million in quarterly phases with break even and profitability projected in the third year after a capitalization event with conservative estimates on the market share capture for the surveying and inspection technologies. At the end of the sixth year, $23,296,500 of sales is projected with only $10,345,780 of expenses suggesting a profit of $12,950,720 for that year. In years 5, 4 and 3, profits are projected to be $11,683,466, $6,995,830, and $789,837 respectively.
Other railroad operational cost saving technologies and products in addition to the surveying and inspection technologies, are also under development with financial projections planned at a later time. The closed nature of the industry and the small number of major customers (there are only five major railroads in the US) offers InSenSys a unique opportunity to roll out other products to the industry with little or no competition in the years ahead. An IPO is planned to provide an exit opportunity for investors at a time to be determined in the future.