Interview with Reggie Chandra, President/CEO, Rythm Engineering
- Reggie, thank you for joining me today. Tell us what your company does.
Rhythm Engineering, is a traffic engineering company. Our goal is to save lives by synchronizing traffic signals. To that end, we designed a gadget that you can plug into any traffic signal in the United States, and it reduces accidents by 25%. Not only that, but it impacts quality of life by reducing emissions by 30% as well as fuel consumption by 25%. That’s what we do.
- Where did you come up with this business idea?
It came out of my personal pain. I’ve been a practicing traffic engineer since 1993. I always ask why we are doing what we are doing; why no one has taken steps to make a difference. So in 2006, I said, “I’ve had enough!” I quit my job in the public sector to make a difference.
- How quickly is this breakthrough being adopted?
We have established market share in the United States and are seeing interest from overseas as well. Selling is a process, especially in B to G (business to government) because there are a lot more hoops to go through. We found that people in Arizona are skeptical of how the product works, even if it is functioning effectively in other locations. They will say, “Hey, even though your system works in New York City, ….we want to make sure that it works in Arizona.” So essentially, what we try to do is find an early adopter in one region. Other people around it see the success, and that’s how we cross the chasm. We call it our beachhead strategy. We establish a beachhead, then we build in all around it.
- Rhythm Engineering is one of the fastest growing companies in Kansas City. Where do you fit on Inc.’s 500 List?
We are #64. ( http://www.inc.com/inc5000/list )
- Very good! Congratulations! We both have observed another market change due to “personal pain”. More companies are developing businesses by harnessing technology to help make business processes and data management better and faster. You are starting to develop a solution in that area as well?
I believe there are two types of businesses. One is a “Me, too!” business, like a franchise. You find a model that works, and people adopt it. It’s laissez faire. You do market validation, you look at demographics and figure out this is the best place for the business. It’s a viable business model, there’s nothing wrong with it—it’s amazing. Then there’s the product business—true innovation. And neither one is good or bad, but product tends to pay out a lot more; but it’s risky, as well. It has to come from true innovation. So you’re going where “No man has gone before!” You’re coming up with a concept, an idea, that you really don’t know whether it’s going to take off or not. And then, most often, it does not. But if it takes off, it’s pretty amazing to see the growth.
- One of the trends I have been tracking are companies that are using technology to create systems for better decision making. I’m familiar with a company that’s designed technology to manage retail cash flow; Another one who developed software and algorithms to help companies (distributors, primarily) identify customer profitability. Or in your case, you’re doing some work on integrating different decision-making systems into one dashboard tool. Does it surprise you that we’re seeing an explosion of this new kind of business venture, where people are using technology to improve data flow and data management, and therefore, data-based decision-making?
Not at all! In fact, one of the local businesses here in Kansas City is doing a dashboard software. I think they’re going Beta right now. Most of it is generated from our personal pain. There is a new product, called Enacct (http://www.enacct.com/portfolio.php ), which is the next generation of Quickbooks. That’s where the industry is headed. Every time I do research on this, I’m seeing multiple dashboard companies coming out that are helping streamline processes.
- So, how do you know when you start on a venture like this, that someone isn’t going to trump you—do it bigger, better, or faster than before you can get to market?
I don’t think anyone is thinking at the level we are thinking right now. Again, we know our market; we know our segment. It’s not about the dazzle, it’s about the information that is given. There are some graphs that I am really fond of that take very little real estate, but they give you the most information. No one is talking about accounting software that is geared for entrepreneurs. Certainly CPA’s, yes, but who’s talking about terminology. We want to change the way people are working and make a difference—just like we did with Rhythm. This new tool will cut out all the jargon and complexity from accounting. Because it shouldn’t be that complex. It really comes down to 1) taking money in, spending money, and your profit 2) if you have cash in the bank, and you know whether or not you have money to hire somebody and 3) if you project your revenue that’s coming in a few months down the road, that if you sell so much, your profitability is going to be that much. It’s all about projection. But I think we’ve unnecessarily added a lot of complexity to accounting that doesn’t make sense. You don’t hear this kind of talk coming from people that are doing dashboards. In fact, we’re actually working here at Rhythm with a dashboard company for over four months, just to get a dashboard over Quickbooks. They’ve not been able to do it. And it’s a leading solution provider. You work with large companies, Margaret. You know the “pain” the large ERP systems give to companies. They spend all this money—millions of dollars, or tens of millions of dollars—and at the end of the day, they don’t get what they want. The small business can’t afford to do it. Two years ago, I couldn’t afford to use Salesforce. When you’re looking at one dollar, and saying, “How far can I stretch this?” You need common sense solutions. Our goal is to develop an affordable solution that integrates the basic data need to run a smaller business.
- I have seen so many new tools that are coming on the market at a fairly rapid pace—your dashboard, as well as other data systems that allow you to make much better decisions about how to run your business. Do you think it’s a fair statement to say that in the next two years if you haven’t adopted or developed a tool that’s allowing you to get more visibility to data that’s available, that you may be behind the curve?
Absolutely! Well what pilot will fly blind! You gotta see! You gotta have instruments before you. You gotta check your engines, you gotta know what the temperature your engine is running, and the fuel mix, or else you’re gonna crash!
- What do you say to business people that say, “Yah, but I know this business. I know what need to be done. I’ve been in this industry for 30 years.”? How do you convince them that they need a tool to tell them what they think they already know?
You can’t. You can’t convince entrepreneurs to do anything—that’s why they are entrepreneurs! They’re hard headed, and they have this thing where they say, “Oh yah, I can take on a tank with a pea shooter!” (But at the same time, who would fly a plane without controls, a dashboard instrumentation?!) So, the more you know about your business—and quickly, the more effective you can be. Yet there are many entrepreneurs who are looking for a better way due to their personal pain who will eagerly use these tools.
- Thanks Reggie, it is fun to talk to an innovative entrepreneur who is making a difference and growing profitable companies. Best wishes for continued success!
Dr. Reggie Chandra, P.E. spent a large portion of his career in public service as a traffic engineer, managing traffic for municipal agencies and leading prestigious multi-jurisdictional intelligent transportation system (ITS) projects such as the $56 million federally-, state- and locally-funded Operation Green Light.
Because of his passion to improve traffic flow, Dr. Chandra grew frustrated with the tools available for him to perform his job. He knew the technology had fallen decades behind, yielding crowded roadways, smog, and wasted time and fuel. He also knew traffic engineers alone didn’t have the answers.
In 2005, he set out to find a solution entrepreneurially by assembling a team of computer scientists and mathematicians uninhibited by traffic engineers’ preconceived limitations. They developed a vehicle-counting camera that laid the groundwork for what Chandra had envisioned since the 1990s.
In February of 2008, the team flipped the switch on an artificially intelligent, digital system that could time lights and coordinate signals to automatically respond to traffic in real time. As a result, he revolutionized the traffic industry.
“The first time we turned the adaptive system on, it was like… holding my daughter for the first time,” he said. “I was like, ‘Oh my God, this really works.’”
Since its launch, InSync has become the top selling adaptive traffic control system in the United States. It is the fastest growing adaptive traffic control system in U.S. history and deployed by more agencies than all other adaptive traffic control systems combined.