Japan’s Farmnote raises $1.7M, developing wearable sensors for dairy livestock



See the original story in Japanese.

Farmnote is based in Japan’s northern island of Hokkaido and has been developing a cloud-based solution for dairy farmers. The company announced today that it has fundraised 210 million yen (about $1.7 million) from Tokyo-based trading company Kanematsu (TSE:8020), Kanematsu Agritech, Japanese mobile gaming company Gree (TSE:3632), Colopl (TSE:3668) co-founder and executive vice president Kotaro Chiba, Six Apart CTO Daiji Hirata as well as an undisclosed Japanese company. Farmnote will use the funds to strengthen the development of wearable devices and peripherals for monitoring livestock, specifically collecting daily performance data on dairy cows.

Incorporated in November 2013, Farmnote has been developing sensor devices and cloud-based systems focused on streamlining dairy and livestock farming operations since June 2014, leveraging a grant from the Japanese Ministry of Economy, Trade and Industry, called the Supporting Industry initiative. The company won the top prize at Zenkoku Startup Day (literally meaning “All-Japan Startup Day”) held in Hokkaido in September 2014 despite the fact that it had been only a few months since they started working on the project.

Farmnote founder Shinya Kobayashi is also known for managing Skyarc, a Hokkaido-based company providing system integration services using content management system Movable Type. Paying attention to the fact that 93% of livestock farmers in Japan are small-scale and keep less than 100 heads of cattle, Kobayashi has been providing these farmers with the Farmnote cloud platform for free, allowing them to manage their livestock individually via smartphone. While farmers feeding more than 100 heads of cattle have to subscribe to the premium plan, the freemium business model has made the company successful in attracting farmers. We were told that almost 3% of the entire population of dairy and livestock farmers in Japan are using Farmnote.

Kobayashi explained:

Farmnote CEO Shinya Kobayashi delivers a pitch at Zenkoku Startup Day in Sapporo, Hokkaido. (September 2014)

We are currently developing sensor devices collecting data on the cattle. Unlike typical wearable devices for humans, our unit has to be fault tolerant with a long-lasting battery because it is attached to animals, meaning difficulty attaching and removing them. We are spending our time and money to develop such a device to conduct a field test on an actual ranch.

We will provide dairy and livestock farmers using our cloud service with these sensor devices. We are not yet sure if we can sell it via one-time payment or need to adopt a monthly subscriptions model. However, our device at any rate will be easy to install so that livestock owners can handle them by themselves, without professional set-up.

The wearable devices will transmit behavioral data using radio waves while the company is not yet to announce which wireless technology will be adopted. Users have to place ‘gateway’ station equipment in multiple locations on their ranch so that signals from the devices can be appropriately captured regardless of how much their livestock moves about. While it’s typically difficult to gain access to power supply or internet on a ranch, it seems the company is addressing the issue in developing a signal-collections platform. If they can establish a technology enabling users to collect data from sensors in a field environment like on a ranch at a reasonable price, that can be applied to the entire agricultural industry beyond dairy or livestock farming and bring data-driven approaches to their businesses. Farmnote is focused on developing sensors devices and peripherals, with shipping slated from next Spring.

Kobayashi added:

The Japanese livestock market is larger than rice farming and valued about $20 billion. Consolidated with other businesses like feed producers or distribution channels for livestock, the market can be considered three or four times bigger. Starting with the services for the livestock industry, we want to collect data on animals and crops in the global farming market of the future.

The global population explosion will cause a widespread scarcity of food and farmlands in the future. To avoid this, we need to further streamline the food production process. As the streamlining efforts based on gene modification technologies are being made in the world, we would like to contribute to the improvement of food productivity, by providing methods to better manage livestock and farm products as well as helping farmers keep doing business with less dependency on their intuition.

While Farmnote has been focused on developing the cloud system, they want to hire data scientists as well as software engineers since they have some good prospects on the development of sensor devices. These positions as available not only in Tokyo but also several locations in Hokkaido. If one is interested in serving the livestock and farming industry leveraging IT skills, you can contact them to get hired.

Edited by “Tex” Pomeroy