When most cloud startups think about their customers, they probably imagine gaggles of office workers or sales people sitting at their cubicles, punching in numbers and making calls. Few would expect their users to be logging in while wearing mud-covered overalls and trying to move hundreds of head of cattle into the milking shed.
Yet that’s precisely the user base for Farmeron, a software-as-a-service startup that today announced $1.4 million in fresh funding and wants to break new ground by taking the cloud into the agricultural business.
So what does it do? Well, essentially Farmeron provides a plug-and-play software tool that allows farmers to keep track of all sorts of information about their farm’s performance. That might not sound like much, but in a business where real-time data can be incredibly important — and spotting trends early can mean the difference between success and failure — it can be a lifeline, says Farmeron CEO Matija Kopic.
“The major problem we keep on seeing — especially in bigger, modern farms — is that there’s a lot of data being created and not being used, on how they’re performing, what they’re doing,” he says.
With Farmeron’s cloud database, “they can see how well an animal, or a group of animals, or a whole farm, is performing.”
Its customers aren’t the only unusual thing about the company, either. Not only does it have a non-traditional market, but it comes from non-traditional roots too — based not in a technology hub, but in Croatia’s fourth-largest city, Osijek, which has a population of just 130,000.
With a round led by NextView Ventures and SoftTech, that meant that talking to investors was sometimes… well, a little odd.
“Definitely it was a very strange thing for them,” says Kopic. “But there are a couple of other startups emerging in this space — like Weatherme, Farmigo and FarmERP — so maybe it’s confirmation of an emerging trend.”
He’s right, there are more businesses making progress in this area, like Climate Corporation (formerly Weatherbill), which uses real-time data for weather insurance that is doing well with the farm community — and has raised nearly $60 million.
Still, investors recognized something particularly interesting in Farmeron, which performed well under the spotlight at popular pan-European investment program Seedcamp and took backing last year from a number of angels, including Dave McClure’s 500 Startups and Robin Klein’s TAG (existing investors are following on into the seed round, says Kopic.)
What was that? Essentially that all the services we think of as typical big data and SaaS plays — analytics, monitoring, and so on — could be applied to the vast farming business.
And when I say vast, I mean vast
Today, Farmeron is focused on one single area of farming: beef and dairy. But the beef industry in the United States alone was worth $79 billion last year, according to government figures, with more than 100 million head of cattle across North America. And given that Farmeron already has customers in countries from New Zealand to Russia to Germany to the United States, it’s a pretty significant market.
The product is charged on a per-head basis — with farms that have under 75 animals paying 25 cents per beast, those with up to 600 animals paying 45 cents, and then enterprise plans for larger outfits. Kopic says the sweet spot is farms with between 300 and 900 animals, which are more able to try out the service and get the most significant benefit from it.
So far the service is small but growing, with a team of eight staff building the software which serves 450 farms on board across 14 countries, and ranging from tiny operations to around 1,000 cattle. But Farmeron hopes to significantly expand that thanks to a new distribution deal with the German animal husbandry company Neelsen.
Expanding internationally means a few small tweaks to the product, but it turns out that farms in one country have plenty of similarities to those in another. The money will instead be used, says Kopic, to build up a sales team, increase support and expand into other farming verticals like crop management.
But that hasn’t stopped the team from receiving a few off the wall requests.
“We’ve been getting requests to see if we can produce software for chicken producers, rabbit producers… even frog producers,” says Kopic.
So will they ever support the frog farmers of the world?
“Eventually yes,” he says. “But not right now.”
Frog used under CC license by GoingSlo on Flickr.