SteadyServ Technologies LLC, the Indianapolis-based startup behind a smart beer-management system, recently raised about $5.5 million in private equity.
The fast-growing company makes iKeg, a system that monitors the amount of beer left in kegs, sends digital alerts when supplies are low, and collects gobs of data on customer consumption. Founder and CEO Steve Hershberger said the fresh capital will be used in part to expand the company's footprint to at least six new markets outside the Midwest.
"I view us achieving the round as important, but it's no less or more important than getting key customers or valuable employees," Hershberger said in a phone interview. "The beer industry is relatively behind in its use of data and analytics."
The latest round of capital comes on the heels of a $1.5 million seed round in March 2013 and a $5 million round later that year. The company was founded in February 2012.
Today SteadyServ is used by bars, restaurants and other dispensers in Indiana, Ohio, Kentucky, Michigan, Minnesota, central North Carolina and Austin, Texas. Hershberger said he intends to expand to other parts of North Carolina and Texas, as well as establish a new presence in central Colorado, Southern California, Northern California, Phoenix, and potentially New York City and Boston.
He's also looking to launch a pilot in the U.K., he said.
SteadyServ told IBJ in 2013 that it planned to grow annual revenue to $25 million in a couple years, but Hershberger recently said he intends to reach that mark around 2018.
The company is in the seven-figure range for annual revenue and could reach eight figures in 2016.
"We want to get it right, deliver value, listen to our customers and then scale," Hershberger said. "We've got relatively patient investors who said, 'We don't need to sign up customers who aren't going to be happy.'"
The company has about 30 employees and is expected to grow to somewhere between 50 and 70 by 2016. SteadyServ has under 250 retail clients, and growth plans are in queue there as well.
"There are 390,000 retailers that are licensed to carry draft beer in the U.S.," Hershberger said. "It is our intent to bring beer kegs online for the majority of those retailers. If we can get north of 5,000 retailers as we approach 2016, we're doing a good job."
Hershberger said while there are a few competitors at points along the beer management process, integrating big data with beer kegs is relatively white space. He said the biggest competitor is the status quo, which for decades has involved retailers making guesstimates on their order forms.
"Our system allows the bars to ensure that they never have too little of the beers that are the most popular and that they never have too much of the beers that they're not all that excited about," Hershberger said.