Austrian software developer Wolfgang Auer inherited a farm from his grandfather and took the opportunity to fuse his two occupations by creating a smart ear tag that pinpoints his cows' location while monitoring their health and digestion.
His startup, Smartbow, has sold some 100,000 tags and in 2017 sold the business to US animal health firm Zoetis, a former unit of Pfizer. Zoetis reported sales of $5.3 billion last year and has sniffed out a rapidly growing business with global potential.
The 43-year-old declined to reveal the sale price but will stay on as CEO of Smartbow, which has 60 employees and generated €7 million ($8.2 million) in sales last year. His customers span the globe and his company most recently sold 5,000 tags to Russia.
But Smartbow's cornerstone product is pricey. Traditional tags, usually made of plastic and marked with a number, sell for $26 for 100 pieces on Amazon. The Smartbow business model is a subscription system and costs considerably more. While it still looks like a normal ear tag, towards the base of the ear is a small, white device that collects information.
Data around the clock
A sensor in the tag detects the movement of the cow’s ear, which varies according to whether the animal is eating, drinking, ruminating or suckling a calf. Smartbow’s engineers filmed the animals performing all those activities and developed an algorithm that informs farmers per computer or smartphone not only where the cows are but exactly what they are up to.
From these figures, other information can be deduced: If the computer registers that a cow is eating less, lying down more rarely, walking more and apparently looking for something, it’s a sign that she is in heat. Life-threatening injuries and conditions can also be detected in this way. Mr. Auer is also working with veterinary scientists at the University of Vienna to develop a self-learning system using artificial intelligence to supply relevant data on animal health.
“We share a heartfelt desire that the animals feel well,” said Michael Iwersen, a scientist who works at the university’s research farm. “We immediately get an alert on the tablet PC if something goes wrong.”
Healthy cows, healthy business
Every farmer knows, ensuring healthy, happy cows is good for business. Health problems lessen milk production and growth. It's a sentiment that holds true for other livestock.
“Our growth is infinite,” Mr. Auer said. Germany alone has more than 12 million cattle and tags for sheep, goats and other animals are in the works.
But farmers are conservative people and Mr. Auer found it hard to persuade them to embrace new technology. Plus, bureaucracy and complex laws in his native Austria make life hard for high-tech startups. If it weren't for help from his parents-in-law, who own a flourishing toilet seat business, his idea would have gone in one ear and out the udder.
Hans-Peter Siebenhaar became Handelsblatt's correspondent in Vienna in 2013 after spending more than a decade as an editor with the paper's companies and markets section in Düsseldorf. To contact the author: [email protected].