Satish Penmetsa didn’t know much about mining 10 years ago and got his introduction to the industry through Wharton business school colleague Jess Kindler, an Atlas Copco and Epiroc industry veteran. Last year, says Penmetsa, his Silicon Valley-based mining software firm doubled in size.
Like the lead character in the movie, Groundhog Day, that partly influenced the firm’s name, Penmetsa’s company has had some near-death experiences.
The software engineer who spent four years at IBM and a further four years as engineering operations lead at NetApp, now a circa-US$14 billion Nasdaq-listed company, has of course learned a lot from his experiences.
“When Krishna Kunam and I started out circa-2012, we named the company rapidBizApps,” Penmetsa says.
“We were super good at designing and building apps for the iPhone and everyone wanted to be the next Instagram, Yelp, Uber, etc. If you had an idea for an app, we’d promised a first working prototype in 72 hours, and a fully functional prototype published to the app store within three weeks, and hence the name rapidBizApps.
“The first customer we ever got was Atlas Copco, thanks to Jess Kindler. They wanted an app to track all of their equipment and we built the first prototype in about six weeks.
“That was also how we got introduced to mining.”
However, “four years in and we had only two customers for our GroundHog fleet management system”.
“Nobody wanted to buy mining software from a company called rapidBizApps. They assumed we were there to sell them consulting hours, and that we were re-selling software made by some other company.
“I’m sure we’d have been a lot further along had we rebranded way back in 2016 when our fleet management product had matured.”
The company eventually – in 2019 – adopted the name of its flagship mining product and decided to focus solely on the one market. The co-founder says “hindsight is 20/20 … [but] better late than never”.
Penmetsa is buoyed now by the market outlook.
“We have a very positive outlook for the upcoming year,” he told InvestMETS.com.
“A lot more mines are digitising their operations.
“Mines see value in increasing tonnes mined per miner per shift, and our products provide the visibility and insights to hit that metric, and other KPIs they track such as equipment availability and utilisation and face utilisation.
“This year I think growth will still come from tier-one markets. There is a lot more brand awareness about GroundHog and these days we get inquiries saying they heard about us from their peers at other mines that use GroundHog.”
Penmetsa said the company finished 2022 with nearly 80 employees – double the number a year earlier. Apart from its Milpitas headquarters, it has offices in Hyderabad, India, and Perth, Australia.
“Most of our customers are in the US, Canada and Australia. We have installs in India and Africa, and we are working through a lot of proposals in Saudi Arabia, Peru, Chile and Colombia.
“I think COVID made a lot of mines re-think the importance of accessing their data, especially underground mines, and they look at digitising their operation as a priority.
“The other [growth driver] I think is that the industry is labour constrained and there is a need to significantly increase tonnes per miner per shift. You do that with newer, more productive equipment and with better scheduling of work to maximise utilisation of equipment and people, which is something our broad portfolio of products enables mines to do.”
A decade ago, says Penmetsa, “the only thing I knew about mining was how to spell mining”.
“We got introduced to this industry through Jess Kindler, a very close friend of mine at The Wharton School [in Pennsylvania].
“We saw this as a pretty under-served market. Most solutions were 30-plus years old and super expensive because they used special purpose hardware. We believed we could disrupt the market using off-the-shelf products, and with very user-friendly apps.”
GroundHog lists Barrick Gold, Rio Tinto, Glencore, Nyrstar, Enaex and Cargill among users of its products, which Penmetsa says address use cases for operations, maintenance and safety.
“I think a lot of our customers choose us because there is a really good product-market fit for all the use cases in underground and open pit mines,” he said.
“We also focus a lot on usability design so it is super easy for miners, supervisors and mine managers to use. We have lots of pre-built integrations with other software, such as Deswik, Datamine, acQuire, etc; OEMs such as Caterpillar, Sandvik, Epiroc, Komatsu, Hitachi and Sany; and ERPs including SAP and JD Edwards, used at mine sites.
“We have a very strong reporting module, with pre-built PowerBI dashboards.
“Our products are very configurable, with no need for custom code.
“I also think we provide really good customer service.”
Asked recently about the scope for start-ups to penetrate and impact the mature mining software market, Penmetsa said: “It is huge.
“There are many smaller problems that larger [software firms] don’t focus on, that are still big pain points in the industry.
“Underground mines did not have a reliable fleet management system, or a shift scheduling system, which is what we focused on. We didn’t go for the [major] vendors, and the modellers, on day one. We went where they were weak.
“I think there is a huge scope for start-ups that focus on mining software. Again, go after the use cases that the big guys don’t focus on, and then make a mark, provide good customer service, and I think you will flourish.
“Our mission in life is to bring all the latest and greatest innovations that are happening here in Silicon Valley and apply it to mining, because we see a huge benefit once mining companies start using the same sorts of technologies that are being used in the Valley.”
Penmetsa told InvestMETS the company had self-funded its development to date, but was ready to look at external funding to help it scale and accelerate growth.
“And yes, sooner is better [than later],” he said.