A Product Market Fit Show | Startup Podcast for Founders
00:06:29 · Pablo Srugo, Niklas Lindgren
[00:06:29] S2: So not like the architecture, more the engineering. [00:06:31] S0: So we power the engineers that are working to design the HVAC systems and the cooling systems of all buildings, and the power systems. And as buildings get much more complex, all owners want to have their buildings run much leaner and less power and there are so many modern requirements on how buildings should work. These type of engineers are just increasing globally because buildings get much more complicated to run. So we build Endra for these type of engineers, so they can work much faster. Today they work in one tool that's called Revit. It was built in '97, acquired by Autodesk in 2002. Nothing had happened since and then. So that's the core platform they work on, and then they have four or five other tools that are all siloed in their tool stack. What Endra does is that we bundle all of this into one platform and then we can run agents to have agents create the design for them. And the end result of all this is that it goes incredibly much faster. The results are based in physics and simulation, and in a much better way than whatever is done today. So that is high level what we do at Endra and the industry that we work in. This is a very large industry. It's only for the consultancies that are designing these systems. That's a $150 billion industry and the MEP equipment market, which is all the equipment that gets installed in buildings. It's almost a trillion dollar market. It's an incredibly large space. [00:08:01] S2: What does MEP, what does that stand for by the way?
00:08:01 · Pablo Srugo, Niklas Lindgren
[00:08:01] S2: What does MEP, what does that stand for by the way? [00:08:03] S0: MEP stands for Mechanical, Electrical, and Plumbing. So those are the main systems that get installed into buildings and if you look at a data center, for example. That's like, they're ninety percent agree, that's an MEP box, basically. So you have cooling systems, you have electrical systems, and you have a lot of mechanical systems that sit inside that. [00:08:22] S2: Tell me about your background, what you did before this and I'm curious how you end up in the space. [00:08:27] S0: I was in law school, and then I went two years in law school. I kind of understood that I wasn't becoming the best lawyer in the world. I didn't really love going to law school, so I thought that was a bit boring. I started a company in 2014, with my childhood friend Anton. Who is also a co founder in Endra. [00:08:47] S2: And where were you based when you started this? [00:08:48] S0: In Stockholm, in Sweden. [00:08:50] S2: Okay. [00:08:51] S0: So we both were in law school, thought that was a bit boring. Started a company almost as a side hustle that ended up that we scaled that company. That was a design build integrator and contractor for security systems. So we were part of building enterprise level security systems for data centers and logistics like, warehouses and enterprise office campuses around the world. But this started very small in Stockholm. We started doing small system installs of CCTV cameras to iPhone repair shops, but we ended up building very, very large enterprise systems.
00:08:51 · Niklas Lindgren, Pablo Srugo
[00:08:51] S0: So we both were in law school, thought that was a bit boring. Started a company almost as a side hustle that ended up that we scaled that company. That was a design build integrator and contractor for security systems. So we were part of building enterprise level security systems for data centers and logistics like, warehouses and enterprise office campuses around the world. But this started very small in Stockholm. We started doing small system installs of CCTV cameras to iPhone repair shops, but we ended up building very, very large enterprise systems. [00:09:27] S2: But this is what? You bought off the shelf stuff, you just figured out enough to make it happen, or did you or Anton have a little background here? [00:09:33] S0: So there's a long story of this, which I won't give you all to. Because then we'll sit here for a very long time, but Anton lived in China before, and so he got connected to some people in Beijing that were connected to a CCTV manufacturer called Dahua. Which at the time was completely unknown in the northern region or in Europe overall and we were the first integrator or distributor of that in the Nordic region. And now it's almost a market standard in northern Europe. But at the time, no one knew about us. We got the opportunity to first work as a distributor and then we started to install ourselves. And then we grew that business over the course of eight years into a substantial size alternative to companies like Securitas or Convergint.
00:09:33 · Niklas Lindgren, Pablo Srugo
[00:09:33] S0: So there's a long story of this, which I won't give you all to. Because then we'll sit here for a very long time, but Anton lived in China before, and so he got connected to some people in Beijing that were connected to a CCTV manufacturer called Dahua. Which at the time was completely unknown in the northern region or in Europe overall and we were the first integrator or distributor of that in the Nordic region. And now it's almost a market standard in northern Europe. But at the time, no one knew about us. We got the opportunity to first work as a distributor and then we started to install ourselves. And then we grew that business over the course of eight years into a substantial size alternative to companies like Securitas or Convergint. [00:10:21] S2: How big did this business get? Like revenue or employee wise, whatever you can share? [00:10:24] S0: So we were around $15, $20 million in revenue and then we sold it to a private equity firm. [00:10:32] S2: Gotcha. [00:10:32] S0: In 2022, so we did our first exit when we were 26 or something. [00:10:37] S2: It's an interesting one, because it's not like, obviously it's not venture massive whatever. But you bootstrapped it, you know, you put a multiple on that twenty and you divide by two, and it's a massive payday.
00:10:37 · Pablo Srugo, Niklas Lindgren
[00:10:37] S2: It's an interesting one, because it's not like, obviously it's not venture massive whatever. But you bootstrapped it, you know, you put a multiple on that twenty and you divide by two, and it's a massive payday. [00:10:46] S0: Yeah, exactly. That was sort of my business school years that I never got. But it was really good. I'm very glad that we bootstrapped it and that we got really good understanding of how money flows. How to build an organization from first principles and I think many people that are starting companies in the VC space early on. Don't really understand what a million dollars or two million dollars actually are, and then we got to learn that the hard way. We almost got bankrupt so many times. We put in all our personal savings and took on an incredible amount of risk early on in our lives. If I could re deal with some of the decisions, I probably would have done. But the outcome was great. [00:11:34] S2: And what happens after? You sell it in 2022, do you stay there for a bit? Because you didn't start Endra until end of 2024 or early 2025. [00:11:41] S0: Exactly, so we stayed there until end of '24. So the segue into Endra is that we had a big design team in this venture that was building all of our designs for ourselves in Endra. So once we were installing a security system, we needed a design team that built the drawings for this and the schematics, and all the calculations behind it. [00:12:01] S2: Same way as you would need for the other stuff, like the HVAC system, the plumbing, et cetera.
00:12:01 · Pablo Srugo, Niklas Lindgren
[00:12:01] S2: Same way as you would need for the other stuff, like the HVAC system, the plumbing, et cetera. [00:12:06] S0: Exactly, it's just different systems, right? [00:12:07] S2: OK. [00:12:08] S0: So my dad is an architect and he said like, if you guys want to have a proper impact on how these buildings are designed in this world. You shouldn't focus too much on security systems, you should focus on the large stuff that are being installed in the core of all buildings. So we did and that was sort of how we found our way into this world. [00:12:06] S2: And you started this with Anton as well? Same co-founder?