Amazon Web Services (AWS) lands in the Portuguese capital of Lisbon, opening its first office in the country with the goal of accelerating digital transformation while delivering new innovative products, Portugal Startups reported on Tuesday.
Although it’s a high tech device, complete with a sleek web interface, Geoprospectors Topsoil Mapper isn’t of the Amazon-best-seller-gadget type. The system consists of a sensor unit that can be mounted on a tractor’s standard clutch, which can be used to map out the structure of the uppermost soil layers. Electromagnetic induction and other technologies allow visualizing and quantifying variations in soil characteristics, such as compaction, water saturation and soil composition. All of these variables can be viewed on a terminal inside the cab. The system provides real-time data that helps the farmer to determine the suitable use of his towed machinery, and thus to get better tillage outcomes.
So, how did that tech gem come to life? Read on.
Starting up
Like all good tech stories, Geoprospectors started with some obscure experiments in a garage. A garage that belonged to geophysicist Michael Pregesbauer, one of the company’s four cofounders, who together with business consultant Matthias Nöster, geophysicist Immo Trinks and archaeologist Klaus Löcker, invented the product. The quartet met about five years ago, at the Ludwig Boltzmann Institute for Archaeological Prospection and Virtual Archaeology in Vienna. Experimenting with near-surfaces exploration technologies in archaeological prospection, they started looking for other potential fields of application that could benefit from their method. Agriculture came up as a relatively untapped market.
The team started working on the concept of the Topsoil Mapper several years ago, yet Geoprospectors only became a company in May 2014. Their business plan was thoroughly planed around several different activities: Sales of their manufactured systems, consulting and prospection services, and also as a reseller of Canadian prospection technology, which was a side business.
The business launched with 120,000 euros received in pre-seed program from the federal bank, Austria Wirtschaftsservice (AWS), and 75,000 euro in equity from the four cofounders. A big consulting contract brought some extra cash flow in 2015, allowing them to further develop the prototype of the system. By the end of 2015, a business angel provided additional equity into the company for the marketing of the Topsoil Mapper.
Empowering farmers
Systems using their geophysical methods, electrical conductivity of the soil and electromagnetic induction, are not new in the industry. “There are some companies out there doing this kind of measurements as well, but they have some very obvious limitations, especially in terms of applicability,” says Nöster.
These companies, he explains, rely on expert systems, which are mostly devices that can be attached to a sledge or hand-carried, often applied by geophysicists. “They collect raw data and after paying a consequent amount of money, farmers eventually get some results” he says, adding that “farmers usually let them come at specific times when their fields are not in use, so the periods over which experts can conduct research are very limited and the results not always usable.”
Unlike other players in this field, Geoprospectors wants their user-friendly technology to be accessible to all. “We want a system that any farmer can fix on his tractor every time he goes over the field and wants to acquire real-time data, not raw data but practical maps” he says.
“We want to empower end-users; we want geophysics to be for everybody, not only for experts,” he continues, elaborating on their general approach.
In the pipes
Credit: http://www.geoprospectors.com/For its first public presentation, the Topsoil system harvested a silver medal at Agritechnica, the world’s largest trade fair for agricultural technology in the world, last November in Germany. A milestone that was their main goal for AWS funding from the very beginning, Nöster explains.
“We met the essential industry players, farmers, consultants, agricultural machinery manufacturers from all around the world,” he explains, “some talks with big tractor manufacturers made us very optimistic for the future.”
Remaining firm on its stance towards independence as company, Geoprospectors isn’t planning on partnering or exiting in the near future. Though Nöster admits that being profitable would be agreeable, he explains that the scientific innovation aspect of their project was the main reason for the creation of the company.
“We are all very much convinced by our methodology and this technology is quite new, so for us it’s about raising awareness about our system: It works, so it makes sense for farmers to benefit from it.”
However, Nöster concedes that if an opportunity to partner with a big player such as American manufacturer John Deere arises, then it would be sensible to do so, as Geoprospectors will target Germany, the UK, Scandinavia, the BENELUX countries, but also the US market in the future.
“First we have to prove that we can market our product and then we can discuss about partnering. They know we exist so it’s already something,” he concludes with enthusiasm, mentioning they have already talked with John Deere’s CEO.
The first five Soil Mappers are expected to be released in April of this year, and will available for rent to farmers and cooperatives for feedback and adjustment. The products entry on the German market is planned for the end of this summer.
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They aren’t millennials, they don’t work on a groundbreaking app, not even in tech.
Erika Wilfling-Weberhofer (40) and Karin Gollowitsch (45) aren’t quite the stereotypical startup cofounders you run across these days. Respectively Event Manager at Graz’s Kinderbüro, an NGO for children, and a design teacher, the two women founded knall.bunt, a clothing brand for children and adults, with a line of special designs for persons with disabilities. If their collections are now sold online and in a few retail stores across Austria, running a clothing business, especially on a part-time basis, is still a constant challenge.
Better late than never
The pair met at a seminar in Graz a few years back and bonded over experiencing pregnancy at the same time. The idea and basis for the company goes back as early as 2010, when Karin made a skirt adapted to wheelchair use for Erika’s disabled daughter. With its colourful design, the skirt was immediately coveted by Erika’s second daughter, which sparked the idea of creating a clothing business for people both with and without a handicap.
“I believe that people with disabilities deserve the same beautiful clothes and hip designs as everybody else,” says Erika. Today, 30% of the production is designed for children with disabilities, using the general collection’s colourful fabrics and patterns in specific designs, such as a half-skirt or a versatile blouse.
Their entrepreneurial journey began rather late. Starting up at respectively 35 and 40 years old, and investing their own money and time, was a choice that the two women carefully weighted. “When you’re over 30 years old, throwing yourself into a business is not an easy decision” says Erika, adding that “with a family to care for and a regular job, there is much at stake.”
Yet, Erika and Karin have found ways to make things work.
Within the company, there is a clear distribution of tasks. Karin, the creative mind, takes care of design and production, while Erika is in charge of planning and organisation. Remaining firm in their stance towards producing exclusively in Austria, the two cofounders work in cooperation with a small tailor shop near Graz. To their eyes, making sure everything is made locally is not only a gage of quality, but also a way to avoid child labour at all costs. “We don’t want clothes made by children for children,” says Erika.
Karin; Photo credit: Andreas VormayrFrom the idea to the business
The decision to take the bootstrapping path came naturally. Unlike an on-demand tailor, knall.bunt produces its collections in advance and distributes them in stores on a commission-based system. While allowing for more creative freedom, this business model is also expensive and rather risky, as unsold pieces represent zero return on investment for Erika and Karin. A lucky encounter with German retail group Wehrfritz, which was holding the booth next to them at a trade fair, secured them a purchase deal. A couple of knall.bunt products are now featured in their catalogue.
In 2013, Erika and Karin secured support from the Austrian federal promotional bank (AWS) and their Impulse XS initiative, which ended up being of significant help to the business. The project was allowed 60,000 euros, including 40,000 euros in funding. “In addition to money for the material, we also got financially compensated for the working time spent on this business,” Erika recalls with enthusiasm. Meanwhile, Creative Industries Styria (CIS), a regional corporation promoting entrepreneurship, supports their initiative as well by offering them visibility through their events, such as the Design Month.
Now in its fifth year of existence, the business is more or less breaking even, though it is seriously stifled by administrative expenses tied to the company’s legal status, an Open General Partnership (O.G.). “Compulsory health insurance costs about 1,000 euros for one person every three months; it represents a huge amount of money given the scale of our business,” deplores Erika. She stresses the absurdity of the system, as the two women are “both employed and already benefit from a health insurance package with their respective jobs.”
Erika; Photo credit: Andreas VormayrKeep it small
What’s slightly surprising coming from the two entrepreneurs is that they have no desire for scaling up.
“Like any other fashion designer, we have dreamed – at some point – of having our flagship store on the main square of Graz, but I think having it all would stop us from doing what we do,” saysErika. As a matter of fact, in their fourth year they dismissed the idea of developing the business extensively and decided to keep it as a side activity. “If we did it full-time, the pressure would probably kill our creativity,” she explains.
Rather than expanding its European footprint, the brand focuses on consolidating its presence in Austria by reaching out to more stores. Thus, it could grow its distribution network while maintaining its current production. Erika also explains that the pair is working on changing the company’s legal status to lighten the financial burden tied to the current one.
If Erika credits the valuable entrepreneurial experience gained on the way, she also emphasises the happiness she gets from their business: “When I see people wearing our clothes, the pride that I feel is well-worth all the administrative and financial struggles.”
If anything, knall.bunt is a good example of how entrepreneurs can run a small business without external funding and/or an aspiration to exit.
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Things are looking good for the Salzburg-based startup Authentic Vision, as they did back in 2014 when their patented label-verification technology won them attention and six-figure investment from the Dolby Family Trust, among other business angels.
Today, several new markets and product areas have opened up to the company, thanks in large part to the excellent network brought in by their board, which includes various Dolby Trust managers as well as former senior executives for Sony Corporation. “We could tremendously strengthen our executive team with the experience of our new CEO Chris Reiser, a former executive at Sony DADC International”, Weiss continues.
Academic spinoff wins critical public support early on
The company was founded in 2012 after Weiss (32) and co-founder Jürgen Mathwich (37) completed their Masters degrees in Information Technology at the University of Applied Sciences Salzburg. Before going back to university, Mathwich had previous entrepreneurial experience working with 3United which exited to VeriSign in 2006. After earning his Masters, Weiss continued on as a university researcher and filed patents for his brand-protection technology.
Before founding the startup, Weiss got some marketing experience as a product manager at an enterprise data services company. “I tried to get my patented ideas developed through a standing company but they told me that they would need a million euros investment, so I decided to do it myself. It wasn’t sufficient for me to follow others but rather to realise my own ideas.”
The Business Creation Center Salzburg’s incubation program took the co-founders under its wings, giving the some lean pre-seed capital and, more valuably, an incubator space for their first year or so. Even more valuably, a member of BCCS’s advisory board, Andreas Spechtler, president of Dolby International, became their mentor. “He gave us a tremendous acceleration and from then on we started to grow,” recalls Weiss.
Other public support soon came from the Austrian federal promotional bank (aws) and the Research Promotional Agency (FFG) – a combination of grants and loans. “FFG funds the research – about 200K euros per year, ongoing,” according to Weiss, “and aws awarded us a middle six-figure number, which they pay down in tranches as project milestones are met.” Without this early public support and imprimatur, Authentic Vision could not have developed their product, researched its possible applications or secured their subsequent private investment.
Authentic VisionDiversifying the products and markets
As a researcher employed at the University of Salzburg, Weiss originally came up with the idea for a telemedical device that could tag objects uniquely. At its core, Authentic Vision’s product is a patented tagging technology – a highly secure combination of QR code and hologram – that allows a scanner to determine if a product is authentic or counterfeit.
“The original idea was to identify counterfeit medicine,” he says, “but the pharma industry has proven a very difficult market to enter. Project times and sales cycles are three to five years, so we chose to hit other markets with faster-moving products and life cycles, such as consumer electronics, luxury goods, and alcohol.”
“CheckifReal” – their smartphone app for scanning their labels – can also be integrated as a whitelabel plug-in for a commercial brand’s own app thus allowing the brand to collect data on its customers and integrate product authentication into its marketing campaigns. “If it is combined with payback goodies or sweepstakes, consumers are encouraged to use the app,” suggests Weiss. “It depends on the use case. For alcohol, we approach it with a payback system to get consumers in the habit of scanning each bottle purchased.”
Helping our clients to get in closer dialogue with their customers, while at the same time protecting their brand and values is our motivation for driving innovation
Hitting the bottle
“We have a business development team in South America that has proven quite successful,” says Weiss. However, counterfeit alcohol is not just a problem in the developing world but in the EU and USA as well, where bar and restaurant operators seeking wholesale bargains might end up serving their customers some watered-down antifreeze or paint thinner poured from a top-shelf bottle. With Authentic Vision’s solutions, authenticity can be checked by not only the end-consumer at the point-of-sale, but also at all points the along the distribution chain.
While the originally intended medical use for the invention may have been inspired by the founders’ desire for social betterment, their movement toward the conspicuous-consumer market doesn’t seem to bother Weiss. “In my heart, we are still in the health-risk market. Counterfeit alcohol or spare parts for autos and bicycles are just as dangerous as fake medicine. With apparel, the trend now is toward sustainability in the supply chain and avoidance of child labour in manufacturing. But with the fake products, all this effort is rendered obsolete.”
Challenges ahead
What makes Authentic Vision a tough sell for Weiss and his growing staff of 20 internal employees and 25 external contractors in their sales network is that “There are so many stakeholders in the mix – not only the lawyers, but also the product and marketing guys are involved in our solution – and this makes the sales process much more difficult,” claims Weiss
“We are thinking about partnering with trust labels like Fair Trade,” Weiss continues, “because the number of worried consumers has reached a critical mass. In the luxury-goods field we have some interesting leads where we have a good network connection, but there is a lot of competition and it is difficult to get a foot in the door. With the wine and spirits sector, it is easier.”
[video:https://www.youtube.com/watch?v=Wc9V-SyFRU8]
Authentic Vision is growing steadily by building up a dedicated team in the USA (Bay Area) and strengthening its business development team in Europe. According to Weiss, “We’ve just announced a global deal going with HDMI a multi-media interface standard. This deal is a great example of how Authentic Vision’s solution addresses three challenges with one solution. Firstly, the solution will help consumers to authenticate cables they intend to buy and thus distinguish quality from non-authorised products. Secondly, the solution will help HDMI adopters to communicate with their customers with use of the label and mobile app. An additional hidden benefit is that of License Compliance. The solution helps HDMI internally to ensure license fees are in line with market demand and allows HDMI to have better insight into the supply chain.”
Together, the two co-founders still hold a majority equity stake in the company and are now doing a second A-round with some existing and new investors, according to Weiss, who believes the new capital influx will help them grow and help them get to break-even and beyond.
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