Why we invested in SewerAI
We love markets that are overlooked, and sewer inspection is one of those markets. And it’s not just because they lie beneath our feet. The US sewer system covers 1.3M miles (over 6B feet), and almost all of us barely give it a second thought. But every foot has to be inspected on a regular basis, usually once every 6 years, at a rate of 400 feet per hour. Inspections are carried out and recorded by camera, and each video currently has to be reviewed more or less in real-time to assess faults and issues. Inspections are vital to maintaining the network.
This is not a fun job. Utilities employ highly qualified engineers to watch a gazillion hours of sludge, pipe, and “murky” water -- a lot of repetitive, boring mileage to cover for someone who could be using their time far more productively. It’s no surprise under these circumstances the accuracy of direct inspection is only 70%. It’s a huge amount of pain, for a huge industry ($25B per year).
Enter SewerAI. Their technology uses artificial intelligence to automate video inspection, eliminating the need for manual review. Matt and Billy have built an exceptional business transforming the efficiency of this vital process, they’ve got literally millions of miles to go. Here’s why we’re grateful to have followed on in their Series A from our investment last summer:
Deep Pain
Inspection crews expend two-thirds of their project time to manually process hundreds of hours of video, often while their equipment and machinery sit idle. It’s a tedious process that often produces flawed data. SewerAI’s technology has doubled the inspection speed resulting in increased productivity and accuracy from the teams, with considerable cost savings on assessment projects. SewerAI isn’t just fast, more accurate and closer to real-time assessment, the data SewerAI provides allows customers to make better decisions faster, lower backlogs, and use their time and equipment more effectively.
Huge Market Size
When you multiply the savings by the vast network of sewers miles, you start to get BIG numbers. Sewer inspection, operation and maintenance is an underserved, massive market, and SewerAI is a clear leader. They’re becoming the go-to for the large and fragmented network of inspection companies nationwide (and now internationally), and have great relationships with the largest companies in the business. Sewers (even just in the US) are a big enough market to to take them to being a very big company indeed, but there are also large adjacent markets in the monitoring of any physical infrastructure assets, such as for roads, trains and bridges, where automated visual inspection would be equally useful.
Exceptional Founder/Market Fit
Matt and Bill have lived and breathed the sewer inspection business for decades. They bring a combined 24 years of industry experience and excel on both the technical and commercial side. Billy knows more about sales in sewer inspection than… well, he’s very good at it. Matt has built software and hardware for some of the biggest names in the industry. Their expanding teams represents about 150 years of experience in the sector, and their rate of shipping product attests to the standard of the technical group they have assembled.
Big Cities Are Excited
Larger cities have seen the experience of two of their first customers, SFPUC and EBMUD in the Bay Area (it is very rare to serve such large, important utilities so early in a company’s lifetime) and are joining in the fun, including the city of Houston, with many more on the slate. The team has done an exceptional job of delivering excellent customer experiences for their initial clients, and word has spread among network managers facing similar issues. It’s textbook execution.
Product Execution & Optionality
SewerAI make inspection data useful – they are already streaming video from inspection robots straight to the cloud, terabytes of data is accessible to utilities on demand in perpetuity through their platform, they’re allowing utilities to build 3D models of their sewers from GoPros… It’s impressive stuff. They are becoming the repository for inspection data at an amazing rate. It gives them intriguing optionality to move up and down the data and decision chain, with the potential to provide end-to-end service, from collection to dispatching crews. It will be one step at a time, but if they keep on solving customer problems, there is a bright future ahead.
Much like the robots that produce the data they process, we’re excited to see what’s coming down the pipeline for SewerAI. Thanks, Billy and Matt for welcoming us onboard, and congratulations on the raise of your Series A. Let’s go deeper underground...
