Today we have our third conversation with Mr. Riccardo Campanile, who is Co-founder and CEO of Social Green Mobility, a startup in the e-mobility and sustainability sector, headquartered registered in Milan, Italy. This is our third update and if people want to see either of the first two, links will be provided to those interviews on the web pages. We’re going to talk about three things today, we’re going to firstly get an update from Riccardo on the funding. Secondly, we’ll turn and get a discussion on operations, where they stand, how they go forward. And then we will close off with Riccardo telling us about the staffing and human resource side of the business.

You can see the first interview with SGM here:  https://seiml.com/venture/interview-with-mr-riccardo-campanile-co-founder-chairman-social-green-mobility/

You can see the second interview with SGM here:  https://seiml.com/venture/social-green-mobility-sgm-crowdfunding-sept-2021/

Script of Interview

Interviewee                                      Mr. Riccardo Campanile (RC)

Position                                            Founder & Director

Company name                              Social Green Mobility

Company website URL                  https://socialgreenmobility.com/en-gb

Interviewer                                      John D. Evans, CFA (JE)

Interview conducted on               15 November 2021

JE  Okay, and good afternoon to the viewers of SEIML ventures interview series. Today we have our third conversation with Mr. Riccardo Campanile, who is Co-founder and CEO of Social Green Mobility, a startup in the e-mobility and sustainability sector, headquartered registered in Milan, Italy. This is our third update and if people want to see either of the first two, links will be provided to those interviews on the web pages. We’re going to talk about three things today, we’re going to firstly get an update from Riccardo on the funding. Secondly, we’ll turn and get a discussion on operations, where they stand, how they go forward. And then we will close off with Riccardo telling us about the staffing and human resource side of the business. So that’s the agenda for today. So welcome back. Riccardo

RC  Thank you John, welcome to you. Nice to see you and nice to meet our listeners.

Funding update

JE  Okay, so let’s kick off. We’re talking about funding and when we last spoke, you had scheduled a crowdfunding for September of this year, two months ago. But that has been postponed till early 2022. Give us the reason for this and what is happening?

RC  Yeah, actually, we were planning to do the crowdfunding in September, because our business is, let’s say, financially stressing, so we need money to start. But suddenly, we got a loan, we got a loan from a bank, which is aiming to help the company doing import. And then, since we have enough money to manage our business, I know that the equity is different from that, let’s say so but in any case, at that time, and now we have enough money to manage our business. So that’s the way why we postpone the crowdfunding to the beginning of 2022 Yeah. That’s the main reason. Of course, there is also a seasonality reason. September, October is not a good time to collect money from about e-mobility because the e-mobility means mainly bicycle in our case and bicycle I’m not that used in the winter season. So, we want to be ready. Since we have enough money to launch the business to show our investors that something is already existing in the in the beginning of next year. That’s why we postpone the crowdfunding.

JE  Nice, nice position to be in not too many startups can say they’ve got too much money, they can do further funding. So, congratulations on that part. So, give us a little bit of the details of this loan: amount, term, any covenants, who’s it’s from? Give the viewers a perspective on that?

RC  Yeah, actually, we got this loan thanks to the let’s say thanks to our, my partner, so and they have a good relationship with banks. And also, it means we are quite reliable people. And we got to 250,000 euros. And the way to pay back this loan is quite good. For 24 months, we shall pay back just the interest, which is quite low. And after these 24 months, we have we have eight years to give to pay back the capital and of course the interest. So, it’s quite it’s quite a good opportunity for a startup to get the money to start.

JE  So, this was from a private bank as opposed to a government agency.

RC  Right, it’s a private bank.

JE  Are there any government guarantees for it or is it purely on its own merits?

RC  Purely on our own merits.

JE  Okay, well, that’s great. And as I recall, the crowdfunding was going to be 500,000 or there abouts. So, this is half of that amount. So, it’s quite substantial and in in total, up to 10 years to pay back so quite a long-term loan. So, congratulations.

RC  Yeah, yeah, actually if it belongs to the, say, the supportive policy of the government to the small companies which are doing something important and sustainable.  It seems our let’s say our business plan is sustainable according to the bank, of course, they checked every comma in our business plan, but it seems it works. So, they grant this loan.

JE  Okay. Well, I remember from the previous interview that your company social green mobility is already government labeled as an innovative company. So, so clearly you’re, you’re, you’re getting support from a policy even though it’s indirect as opposed to direct government support, so I can see that.

RC  Exactly.

JE  Okay. So, how does this relate to the crowdfunding? How long will this tide you over? And have you picked a specific month when you think you will start the crowdfunding?

RC  We will start in early February according to the plan, and then we are working on it, because we have to collect the first 50,000 euros. So, we have to look for the early bird investors, because this is the minimum allowed to go ahead. So first, we have to collect it with the grant 50,000 Euro from early bird investor and then we can move to the to the crowdfunding.

JE  Okay.  So the crowdfunding was originally scheduled for September so it’s, it’s been moved back by five months, preparing for February of next year. Okay. Very interesting. So, let’s, let’s go to the second topic on the on the operation side you’ve already mentioned or hinted at the seasonality of, of the operations. So, talk us through the importing process, how many bikes you’ve assembled, where do you stand now? When will the season start for you next year?

Operations update

RC  Okay, seasonality and about bicycling is very important even because we are in Italy and Italy, I used to say, that it’s a country which should rely mostly on tourism. And tourism is mainly for us in summer, spring and autumn time.  Wintertime is not that much suitable the bicycle business. So, we use these months to assemble, we already placed the order for more bicycles and we want to place them to place them in the in the host site in the springtime.  We are already working with some resorts in Apulia, south, south of Italy, in North of Italy, around the Garda Lake, in my region Liguria. And actually, in that even other location are interested just because as you as you know, our business doesn’t ask anything to the host.  The host just as to give some small place where to where to install our, our loading station charging station. And then it has nothing to pay, nothing to just to share the revenue.  It makes the business very, very interesting. We got a lot of a lot of interest about this offer. And now we started to install the bicycle in any region of Italy because, of course a spring will be much better, but we want to be ready to install hundreds of bicycles in in springtime.

JE  Hundreds of bikes.

RC  Yeah.

JE  How many are you forecasting for the start of next season? 200, 500, how many bikes?

RC  200 bikes.

JE  Yeah, just to start off. And then you will add additional ones every year and build up to a larger number in the future years, I guess.

RC  Yeah, actually, we count on the crowdfunding to buy more and more bicycle because the key point of our business is based on the on the quantity of bicycle installed. The more they are, the better it is for the for the revenues. Of course, if our price is quite competitive, we have to count on quantity, Chinese way.

JE  So, talk us through the importing and assembly. I know you get some parts from China, but you do assembly locally, give us a bit more detail of exactly how that works.

RC  Yeah, actually, to do that we had to register an assembly company, a new company, the name is Green Mobility service. And this company is just in charge of to assemble the components we buy from China. It’s important, it’s a very important step, because without this, let’s say, this small industrial company, it is possible to avoid the anti-dumping custom fees that in Italy are quite severe and strong. Actually, they are valid in all Europe. But Italy since Italy was the most important bicycle manufacturer in Europe, now the custom is very, very sensitive about anything imported by my abroad and by China specifically. So, if you have your own factory, you can import parts and then transform them in, in bicycle. But without an assembling, say in operation of operating companies just trading, you have to pay all the custom duties, which are quite unaffordable. So that’s why we decided to establish Green Mobility Services.

RC  Is it just one location or other assembly locations?

RC  It’s one location. It’s just one location, it’s enough to assemble it. We have already everything to proceed. It’s one location, it means that we had to change a little bit our business description.  In the past, we can’t adjust to move components to the say the service points along around the territories easily. But later on, we had to consider, to reconsider this decision and then to assemble the bicycle all of the bicycle in one place, through this new company, Green Mobility services.

JE  Okay, so you do all the assembly of the components into the bikes in Italy? Do all of the components come from China? Or are they from other locations?

RC  Right now, all the components are coming from China.

JE  Okay, and fully assembled in Italy. Okay. So, we’ve been talking about the bikes, the physical bikes, but there’s another business. And that is the GPS side of the business, which I think is called LOCAXY as opposed to BAIKKY for the bike.  Update is on the development of the GPS side.

RC  Yeah, actually, the GPS trackers is a collateral business we are running.  We recruited one staffer, which is working as business development manager is working on the first on the product propositions and all the tools to propose this product to the companies. We are targeting different kinds of markets. First of all, automotive but not only that one. And we are just starting now to propose our products and our services because it’s not only a matter of product.  If you surf on Amazon, you can find a lot of GPS.  You can buy them but there is no not there is not always there is the platform to manage the GPS itself.  We develop Nan APP, so it’s a platform actually, and where the customers can buy the GPS and can buy also the service and can buy also a customized APP.  So, our APP is open, to be customized because if a big truck company wants to say customize its own asset, we are we are able to do to do that. It’s an interesting business.  In other countries like US, GPS is very, very popular.  In Italy and they say we say in Europe is by now is just for say insurance companies, big fleet management companies, but not yet so popular as it should be. Actually, we are living in a world where any anytime we have to be available, we are thinking just to have a more dynamic way to deliver goods.  Nowadays, you know like there are many delivering companies in city, out of the cities, of course to localize all of these, for instances just an idea, all of these riders bikers, so in any case, small van who are in charge of deliver will be helpful not only to the company itself but also to the customers because we can meet each other not necessarily to the address written in in the in the way-bill. So, it’s a huge business, which can help a lot. And there are some private businesses like. about children, about eldest people, about pets, whatever. But it seems to be very promising business.

JE  Okay, I’m going to ask an additional question, which was not on the Talking Points, but it came to mind. So how tied together are BAIKKY and LOCAXY?  I mean, are they essentially one product, because when you talked about GPS, it sounded like that could be almost an independent business.

RC  Actually, that this business was born as a collateral business, because in the very beginning, we designed our bicycles with in with the GPS inside, because we want to check, since it’s our, our own assets, and also doesn’t pay anything we are worried about. Bicycle could be stolen, and then so on. So, we installed the GPS tracker in all of our bicycles. Since we had to develop the APP considering the presence of the of the GPS tracker itself, the idea was why not to propose the same application to other kinds of companies, businesses, and so on. So actually, LOCAXY was born as a collateral and unexpected business, to SGM to Social Green Mobility, BAIKKY.

JE  That’s interesting. So, I surmise, it’s, it will remain a core part of the E bike offering, but it also has a lot of applications outside as well. Okay, that’s very interesting. Now, I came across this company Suzhou Abilu Industrial Design, SAID.  What is that company about, where does it fit into things?

RC  Yeah, this company. As you know, when I with my partners we established SGM, I was in China. And those other two partners were and are in China nowadays. With the SAID, we are going to develop mainly design and software. So, this is the R&D company of our small group, because the group is SGM in Italy, GMS in Italy and SAID in China. SAID is in charge of to design to develop the APP, to look for suppliers. So, all the let’s say the engineering is delegated to SAID. Engineering and also, let’s say outsourcing.

JE  Okay, so it’s connected to the company.

RC  It is a company providing services mainly, by now it’s a company providing services.

JE  And focused on the LOCAXY, it’s not involved in the physical buildup of components for the bike. Okay, that’s clear. Yeah. Okay. Very interesting. So, I think there’s something very interesting going on, on the staffing side, which is our third topic today.  You’re looking to hire or to bring on board a Chief Operating Officer. Now your CEO, tell us about that, and what that person will do, how they will be different from yourself, etc.

Update on staffing

RC  Yeah, actually, we launch a lot of activities. But none of us I mean, of our four founders is free 100% of its time is time to manage the operational things of the company. There is a lot of job to do we have a lot of requests from let’s say tourist organizations but not only also for recruiting and also for other opportunities. So, we need someone in a skilled enough to manage the daily operations of the company. Otherwise, we the risk is to stop to put an obstacle because I have my own job, everyone one of us has his own job and we cannot grant full time job for Social Green Mobility. And frankly speaking, I guess we must grant to our investors, someone who is in charge to follow the business full time.  That’s why we decided to look for a COO and we already collected a lot of CVs a lot of resumes and then we are going to analyze all of them and then to choose the right one.

JE  Any sort of timeframe when you when you think this person will come on board? Or is it very flexible until you find the right person?

RC  Yeah, very flexible and there is also the issue about the crowdfunding, I don’t want to overlap the two issues. Possibly, possibly might be after the crowdfunding action to let the guys in guys that the CEO in the coming into the join the conference.

JE  Okay, I mean, does Social Green Mobility have its own office? Or will this person start working from home because I guess a lot of travel will be required.

RC  A lot of travel will be required for sure.  We have our own office in Milan, where our staff is already there. We have one guy working there as a business development manager for LOCAXY by now. So, we have our office, but for sure, many, many travel will be required. Yes. Okay. Okay. Actually, nowadays, we already do it by ourselves, but we have to share our time. Because nowadays, we have two people, two founders in Italy and two in China and we do our best to split the commitment according to the location.  But nowadays the location still requires much more time, much more traveling, and then it’s a pity to let this business, wait for my availability.  When once I am busy with my job and to have a COO to do full, full available to our customers even because we are saying there are many, many instances not only because it’s free, because it’s a good idea. So, the idea, many people like this idea to share this, these revenues and to put their commitment in this job. We are also talking, but I don’t want to mention it with a utilities company in the business of electricity. It’s a producer and distributor of electricity in Italy and they are interested to do this to cooperate with us not only because they want to put their charging station wherever in the cities in the small villages. So, they want to enter in the electricity distribution to the end user rightly. But also, because they are working on the carbon free credit. They know that carbon free credit is a big business, you know, it’s a typical of automotive as far as I know, Toyota is the number one in this business because they started to produce e-vehicles in the past, they get a lot of Credit carbon free credit, and they sell this credit to other companies, which are still a little bit back  in this business. So also carbon free credit is a business is the business of the future. And so that’s why we are cooperating with this company. And we hope to get to an end, to finalize the cooperation, now we are just talking.

JE  Interesting. So, what started out as a, an electronic bike moved into the whole field of GPS, and now it’s into carbon trading. So, a lot of things connecting with each other. Very, very interesting. Okay, so that covers our three topics. Is there anything else you’d like to add in terms of this update? Because I guess we won’t be speaking again until sort of late January for the crowdfunding. Anything else to mention at this time?

RC  No, I have nothing else to mention. I hope next time I can. I can be more let’s say pragmatic mentioning the agreement we could we are working with about and so hopefully we can. We can see each other another time next time.

JE  Okay, well February is just at two and a half months away, so not too long. So, we’ll be interested to follow the developments of the bike distribution system, the GPS system and maybe this partnership with the electricity company as you reference. So, a lot of things to stay in touch with and I wish you the best between now and the crowdfunding, when we will probably speak next.

RC  Thank you, John. And thank you all of our listeners.

End.