Farm Management Software Startup Increases Efficiency, Opens Eyes and Wallets in Silicon Valley
June 12, 2012 | Jessica Vernabe
Running a dairy or cattle operation efficiently requires the management, tracking and assessment of complex sets of data ranging from animal feeding cycles and health to overall production performance. Farmers and their teams often spend an inordinate amount of time and money shuffling through spreadsheets, manually cobbling together data to insure that their operations run smoothly.
To solve this problem and increase the efficiency of data management, a company called Farmeron has developed an online software product that enables livestock farmers to easily track the ins and outs of their animals. The company’s software program allows farmers to manage such data sets as the number of animals on the farm, feeding cycles, milk production, medical treatments, location transfers and much more. Through Farmeron’s cloud-based web application, farmers can update their data as they go and later create reports and analytics that keep their farms running more efficiently.
Over the past year and a half, the Croatia-based SaaS (Software as a Service) company has had tremendous growth and is now serving about 600 farms in 14 countries, mainly in Europe, North America and South America. (In early May, just a little over a month ago, the company had 450 farms using its farm management software system in the same number of countries.)
Matija Kopić, who received a master’s degree in computer science from the University of Zagreb in Croatia, founded the company in late 2010 because he knew information management was a major struggle for farmers. He had firsthand experience having been born and raised on his family’s farm in Croatia, he said. He also had friends who were farmers.
“The problems were particularly becoming harder as farm technology evolves and as the farm production dataset grows,” Kopić said. He recognized that livestock producers were in particular need of an information management software system, and he didn’t know of any others that existed at the time. “We know that dairy—livestock production, in general—is the most complicated vertical within agriculture.”
Kopić says using Farmeron’s software has helped its customers decrease their production entry and report generation time by about 60 percent on average. He predicts improved management of farms will help drive the shift toward sustainable agriculture in the future, especially as the word population grows.
“It’s imperative for agriculture to become more efficient in these new circumstances,” Kopić said. “We think that the next revolution of agriculture will be driven by information technologies, which will improve the decision making process in food production cycles—not only on the micro-farm level, but also at national levels and international levels.”
Farmeron manages a variety of datasets, according to its website. Through Farmeron, farmers can keep an animal database, meaning they can keep track of every single detail of each animal’s life and production performance. Farmers can also use the program to manage feeding groups, track weight performance and how that weight is impacted by certain feeding mixtures, monitor animal’s health and medical treatments, collect milk production data (comparing production results with production inputs and their costs), and keep track of reproduction data, animal transfers and farm inventory.
When farmers aren’t inputting information, they can just log into Farmeron’s Farmboard, which provides a simple real-time overview of their farm production trends. Farmeron also allows customers to produce a number of predefined production reports, which are designed to aid in decision making.
Farmeron offers three different payment options for its services. Customers pay $0.25 per animal monthly for the Basic plan (for one user and no more than 75 animals). They pay $0.45 per animal monthly for the Plus plan (for up to five users and between 76 and 600 animals). The company also offers a more customized Enterprise plan, through which the number of users and animals are unlimited. Thirty-day trials are available for potential customers.
Kopić said most of his customers are medium- to corporate-sized farms, and they are generally categorized in the Plus or Enterprise plans.
“It’s easier for us to sell to bigger corporate farms, which have larger sets of data (and) are bleeding money because they have dedicated teams on board shuffling spreadsheets every day, the entire day,” Kopić said.
He noted that Farmeron serves both conventional farms and farms that use environmentally sustainable practices. The company’s clients have generally been retained through social media and word of mouth, he said.
Kopić started Farmeron in late 2010 after he graduated from the University of Zagreb. Several weeks into the venture, Kopić recruited his friend, Marko Dukmenić, who is now Farmeron’s chief technology officer. More employees were brought on board later. The company started out with about a dozen clients in the Central and Eastern European regions. However, the Farmeron team soon realized they needed more resources so they could scale up the business.
“We couldn’t earn enough money to hire more people and handle more clients, and we were getting a lot of interest from the outside,” Kopić said. “So, we decided to look for a strategic partner and investor who then helped us to develop that vision.”
The company submitted an application to the European early-stage mentoring and investment program Seedcamp and won some investment funds. Through Seedcamp, Kopić learned about 500 Startups, a seed investment fund and startup accelerator program in Silicon Valley. In the fall of 2011, he and his company’s team members went to Silicon Valley to participate in the accelerator program so they could learn more about the U.S. market, which made up almost 45 percent of the company’s customer and interest-base at the time, Kopić said.
Before going, Farmeron had incorporated the company in the U.S. It now has an office in Mountain View, Calif. Kopić says he plans to relocate Farmeron’s headquarters to the U.S., likely in the Midwest. When that happens, the company’s development team will remain in Croatia.
Since then, Farmeron has grabbed the attention of even more investors. In the company’s most recent investment round, which was in May, it secured $1.4 million in seed funding. The round was co-led by venture capital firms NextView Ventures in Boston and SoftTech VC in Palo Alto. That investment round also included funding from Farmeron’s original investors—Seedcamp, 500 Startups and The Accelerator Group. The company has also received funding from angel investors.
Lee Hower, general partner of NextView Ventures, said a few things peaked the firm’s interest in Farmeron. First, the investors found Kopić to be a dynamic, thoughtful and passionate entrepreneur who had a strong background in both the software and agricultural sectors, he said. Second, they recognized that there was a large market to be served.
“We saw a huge opportunity where there are a lots of and lots of farms across the U.S. and other countries,” Hower said. “And then also, the data management needs they had were complex, but (there were) not a lot of great products out there designed to help them. Running a farm with 500 or 1,000 head of dairy cattle, there’s obviously all kinds of big needs of the production system.”
This is the first time that NextView Ventures, which invests in software and Internet-based companies, has invested in a company that targets the agricultural market. Hower said it is usually rare to see venture capital firms invest in such companies simply because investors generally don’t already have a great depth of understanding about the agriculture industry. NextView Ventures, on the other hand, has seized the opportunity.
“One of the things that we liked was there aren’t plenty of other software startups pursuing the market opportunity that Matija (Kopić) is pursuing,” he said. “We think Farmeron is well-positioned to capture a major portion of the market as opposed to other software markets where there’s dozens of companies pursuing the same opportunity.”
Kopić says Farmeron is still in the beta phase. It has a combination of paying customers and those that are just testing the software product. The company is preparing to release a new fully functional commercial version of the product in the next five to six weeks. The new version will include some remodeled existing features along with new ones, Kopić said.
Other future plans for Farmeron include adding a crop module to the system by the end of the year, and eventually adding mobile features and a social networking feature for farmers. The crop module will be particularly important to livestock farmers who produce food for their animals, Kopić said.
Farmeron has not yet reached the break-even point in its finances, but Kopić says that’s only because money has been reinvested into the company. Farmeron now has nine employees, five of which were hired within the last three months. There are also plans to start building up sales and support teams for the company, he said.