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Indy startup serves up keg beer with big data

May 24, 2013

Few people besides Steve Hershberger can claim they’ve successfully mixed calculated decision-making with beer consumption.

Hershberger’s year-old company, SteadyServ Technologies, revealed Thursday that as of March it had raised $1.5 million from investors to help develop its iKeg prototype.

The device detects how much beer remains in a keg and alerts customers via mobile app when supplies are low. Investors believe the real value could be in iKeg’s ability to turn the digital information it collects into a sales and management tool for its customers.

SteadyServ is already raising another investment round that will allow the company to take iKeg to market.

Hershberger, a software developer by trade who helped start Flat 12 Bierwerks downtown, conceived of iKeg after a visit from an out-of-town friend, also a beer aficionado.

“He flies into town, and we go to Mass Ave,” Hershberger said. “We went to four bars, and they were all out. So we finally went back to the hotel and ordered one of the beers the bar had. It was just a beer he wasn’t really looking forward to having. His parting shot was, ‘Gee, Steve, you really let me down on this.’”

So Hershberger went back to the bars and asked management about monitoring beer inventory. Knowing how much brew remains in a keg is a constant guessing game because no one can see into the metal containers, he learned.

“The bar manager will go into the cooler and will shake the kegs and say, ‘This feels half-full,’” he said. “‘It’s Tuesday and it feels half-full, and I order on Thursday. I think I need to order more.’”

Hershberger offers an engineer’s explanation of how iKeg works. In effect, a ring-shaped sensor that attaches to the bottom of the keg in question can detect how much beer remains and digitally feeds that information to the bar managers and distributors. When beer gets too low, the device sends out alerts.

It one-ups the legal pads or Excel spreadsheets restaurant and bar managers typically use to track supplies. It eliminates guesstimates of inventory and speeds the ordering process.

Distributors, SteadyServ's target market, can monitor how much beer their customers have at any given moment, and they follow up with sales calls when beer gets low. Meanwhile, the digitalized inventory process is collecting gobs of information on how customers are consuming beer.

All that data on beer consumption should be valuable to bars, distributors and breweries, Hershberger said.

“Let’s say you’re a Scotty’s [Brewhouse],” Hershberger said. “As they open a new store, they’re going to want to know what beers are popular. Our system has the ability to look into that.”

Carl Bruggemeier, president and founder of The CZH Hospitality Group, a restaurant consultant, said the big-data potential piqued his interest as an investor in SteadyServ.

“Long run, it’s the data that can be collected,” Bruggemeier, who sits on SteadyServ’s board of advisers, said when asked whether the actual iKeg inventory service or the data it collected would produce more revenue.

More primitive inventory systems already exist, but they can’t pool and distribute all the information like iKeg can, he said.

SteadyServ’s concept has generated interest both in the beer and technology industries.

The board of advisers includes David Coors, of the Coors Brewing Co.’s namesake family; Jeff Ready; CEO of Indianapolis-based Scale Computing Inc.; and Pat Canavan, former senior vice president of global governance for Motorola.

SteadyServ's 11 employees are finishing beta testing with a handful of volunteer restaurants and bars around Indianapolis.

Most investment has come from angel investors, but Indianapolis venture capital firm Elevate Ventures committed $125,000.

“The iKeg solution is breaking into a $21 billion draft beer industry where there’s incredible potential,” Elevate CEO Steve Hourigan said in a prepared statement. “It’s exciting and gratifying to see a company like SteadyServ make its home in Indiana, and we’re proud to say that we support their team and the business they’re building.”

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