On Fleet

Khalid Naim, who holds an MBA from Stanford and grew up between London and Dubai, co-founded On Fleet with his CTO David and a third high school friend. The team began at Stanford, where they incorporated a company for one project that did not work out. After about a year and a half and a stint in Stanford's StartX accelerator, they shifted focus to what became On Fleet, a software product for businesses that run local delivery operations.

On Fleet was launched publicly in April 2015, though the product took about a year to get out after the decision to pursue it. The product includes smartphone apps for drivers, dispatch dashboards, analytics, and route optimization algorithms. Customers range from food and beverage delivery to prescription pharmaceuticals and medical cannabis, as well as laundry, moving, flowers, and retail. The team raised money from friends and family, then an angel round, then a larger seed round, using a mix of convertible notes and a priced equity round. In total, the company has raised about $4.5 million.

On Fleet's growth model is built on a 30-day free trial with no task limit. Companies are asked for a credit card at the end of the trial and then billed monthly based on delivery volume. Khalid explained that heavy trial usage is a signal of likely conversion, so the company encourages it. Customers who pre-purchase task credits for a year receive a 20% discount. Premium features such as route optimization add $0.09 per task.

As of the interview, the company had about 300 paying customers, with an average payment of roughly $400 to $500 per month. Acquisition cost is around $1,500 per customer, which the company recovers in about three months. The host estimated the company was doing a minimum of about $150,000 in MRR.

The company's net MRR churn is around negative 7%, meaning expansion from existing customers outpaces churn. Customers grow organically on the platform, and some have stayed since the early days. Customers who leave typically return to pen and paper, Excel, or Google Docs, or build their own software once they reach very large volumes of around 100,000 tasks per month.

The company is also moving upmarket, with more mid-market and enterprise accounts in the pipeline for businesses operating across multiple cities or countries.

As of the interview, On Fleet had about 15 employees in San Francisco, around 300 paying customers, and an estimated lifetime value of about 18 months per customer. Khalid described the most rewarding part of the work as building the team.