Innovation series: Engineering student's start-up has billion-dollar prospects
Growing up on a 300-cow dairy farm in Matamata exposed Craig Piggott to the problems farmers face.
With a first class honours engineering degree and a year's experience building rockets for Rocket Lab under his belt, he is now solving them with his own agri-tech invention.
Piggott, 22, came up with the idea for a GPS tracking, solar powered cow collar while studying at Auckland University. The idea could not wait until he graduated, he said.
His invention, named Halter, self-herds cows and sends data about cows' behaviour, emotions and health to a farmers phone, saving time and money.
The collar makes warning sounds when a cow approaches a boundary, teaching her how far she can move into an area.
Halter could completely do away with the need for fences, Piggott said.
He asked university friend Max Olson to be his business partner.
"We lived and breathed Halter. Although we were months behind in university we were months behind together."
They trialled the first collar on one of Piggott's family pet cows.
He thought growing up on a farm meant he knew the dairy farming system inside out, he said.
But a market validation tour of North Island farms late last year proved otherwise.
"The way people farm in the Manawatu is so different to anything I have ever experienced," Piggott said.
He found that current agri-tech products cost farmers too much time to use.
"When you are up at 2 o'clock in the morning calving a cow, all type of data analysis goes out the window," Piggott said.
He did not tell his Fonterra dairy farmer parents or his part-time boss, Rocket Lab founder, Peter Beck about his idea originally.
"I did not want to have this biased confidence in my head," Piggott said.
But when the time came to raise capital, Beck wanted in.
Beck said he invested in Halter because he thought it was a great idea with billion-dollar potential, he said.
Rocket Lab reached a worth of $1.42 billion last week after its latest round of capital raising.
"I get pitched lots of ideas and my first question is always, show me how this is going to be a billion-dollar company," Beck said.
"Ninety-nine per cent of Kiwi entrepreneurs do not think that big. Craig thinks big."
Beck sat on Halter's board and was an invaluable mentor during the money raising process, Piggott said.
"The amount he has taught me is more than my university degree could ever have."
Raising money alongside final university exams was not the biggest challenge, Piggott said.
Because the pair had not yet completed their engineering degrees, they had to overcome a credibility hurdle.
"We tried to use it to our advantage … we had to capture the young and hungry aspect."
They secured almost $700,000 in government grants and equity funding, Piggott said.
The collar was now being tested to ensure it could be seamlessly used by farmers, Piggott said.
"It is a big trust game with dairy farming.
"We want to be overly sure that when we hit the go button and roll out, we know that it works."
Piggott said agri-tech innovation needs to move faster in the extensive New Zealand market.
That is the greatest lesson he learnt from Beck – to move fast, he said.
Large corporations' biggest barrier to being innovative was culture, Piggott said.
"New Zealand has been world leading in dairy for years because of our geography.
"We have had this head-start and now we just need to innovate to make sure we are always in front of other countries."
The Fairfax Media business innovation series runs in partnership with Callaghan Innovation.