One of the first major financial milestones in one’s life is the purchase of a first car. Naturally, whenever you purchase a new car, the ability to protect your investment by monitoring the vehicle’s performance, location and overall use may extend its life, help to avoid accidents and protect the security of the driver. IGEN Networks Corp. (IGEN) provides cloud-based services through Machine-to-Machine device technologies that empower the consumer through secure access of data for both the driver and car.
Having reached Partner Relationship Management (PRM) status within Verizon Communications, Inc. (VZ) , IGEN, through its Nimbo LLC subsidiary, has effectively earned access to Verizon sourced sales leads, along with marketing support of its services for new car dealers across the United States.
To discuss IGEN Networks and how they will change the current automotive market, Equities.com had the opportunity to speak with Neil Chan, CEO of IGEN Networks Corporation.
EQ: Could you provide a brief overview of IGEN networks and its operations?
Chan: My vision for the company is to build a world-class organization as a service provider based on analytics or business intelligence for the consumer automotive industry.
As a service provider, we integrate with various device technologies and software platforms that are bundled with our strategic partners. For example, along with 24-hour roadside assistance programs, real-time information on the driver and the car may be accessed as required, including location, battery health, time and distance of the tow truck, etc.
EQ: What’s most intriguing about IGEN’s technology is that it's able to report both vehicle location and performance data. What are the growth prospects in your target markets, and how do you plan to capitalize on those?
Chan: Our target market is a subset of the IoT, or the Internet of Things. The new car market is estimated to grow from $700B to $1.6T over the next five years globally. We see opportunities in the insurance industry, stolen vehicle recovery, and offer additional value for roadside assistance programs across the United States.
When you buy insurance for your car, insurance companies ask a bunch of questions. However, at the end of the day, your insurance is based on demographics: how old you are, where you spend most of your time, and so forth. A 2011 study revealed that in 2010, the US insurance industry identified that they had about $15 billion annually in rating errors. What that means is that when they sell you insurance, they're guessing. Our service platforms enable us to collect meaningful data on the car, including the driver’s behaviour, thus reducing the rating errors when establishing actuarial policies.
Recent reports indicate that there are over 800,000 cars stolen in the United States each year - that’s every 90 seconds. The other opportunity is roadside assistance, worth more than $6 billion in annual revenues.
Ninety-percent of new cars in the next five years are going to be connected to some form of wireless service. The growth projection for wireless connections for services is estimated to reach 7T over the next five years.
EQ: Can you discuss your company's competitive or strategic advantage over your competitors?
Chan: It’s actually very fragmented right now in terms of competition. LoJack Corporation (LOJN) , for example, is a company based in the Massachusetts area that focuses on stolen vehicle recovery. Maybe the closest competitor with regard to providing services to the consumer is OnStar. Their service is provided in General Motors Company (GM) vehicles and some other brands, based primarily on call center interaction.
Our primary distribution channels are the new car dealers that account for more than 25,000 locations across the United States. We are one of the few companies that offer value from start to finish for new car dealers, starting with the capability of inventory management – location and automated reading of Vehicle Identification Number or VIN. With the device activated and “pre-loaded” into the new car, additional services are offered to the consumer that include Stolen Vehicle Recovery and Roadside Assistance programs that are augmented by direct access to IGEN software applications typically residing on smart phones or similar user devices.
We empower the consumer as to who and when information is accessed, or when you choose to provide it. Also, when you lend your car to your significant other, relative or children, you can see what he or she is doing, how much time they have been spending in various locations, and so on. Essentially, information is sent directly to the consumer. Rather than waiting to discover your car was stolen, what if you were alerted as soon as someone broke into your car? What if you received an alert on the poor condition of the car battery before it died on you?
EQ: I did read about your Verizon Partner Program where IGEN reached a major milestone with PRM status. Can you talk about the impact of that status?
Chan: Receiving sales leads from Verizon is key. This expands our distribution channels several fold across the United States to call on new prospects.
Do you know what that really means in numbers? There are 300 sales people in Southern California alone!
EQ: I read that in the quarter through June 30, IGEN’s revenue totaled just under $300,000, with 90% of revenue coming from hardware sales. How was the company able to generate such impressive growth?
Chan: We've only scratched the surface. What you saw in the last quarter was really the initial stages of expanding our channels into selling into more dealers across the United States. We work with about 500 dealers right now. There are 25,000 new car dealers. You’ll notice that we've been growing every quarter since last year after acquiring Nimbo LLC. Our goal is to take it to the next level through the Verizon channels.
EQ: What are a few milestones or goals over the next year or so that the investment community should look out for?
Chan: We have a fantastic opportunity in working with Verizon to expand our dealer channels. The other objective, which I have stated publicly, is that we will continue expanding internationally.
EQ: Could you expand on your background, as well as mention other key members of your management team?
Chan: Best to look me up on LinkedIn.
Richard Freeman, our Chief Operating Officer has 30 years of experience in the wireless data industry that include tenure with Motorola, Sierra Wireless, and most recently Webtech Wireless a leader in Fleet Management in more than 40 countries.
William Boyles is our VP of Sales. Bill has 30 years of experience and an extensive background in the consumer automotive and wireless industry.
For more information about IGEN Networks, visit www.IGEN-networks.com.
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