Maarten Goossens: Major animal health technology deals will grasp Silicon Valley's attention
Maarten Goossens – the founder of Anterra Capital – believes Silicon Valley investing will now be well aware of the animal health space after some notable recent transactions.
Speaking at the Digital Animal Summit at UC Berkeley this month, he noted: "On the companion animal side, most of the venture capital dollars have been spent on services, nutrition and e-commerce. If we look specifically at the pet health value chain, we've seen a couple of interesting investments getting good traction and digitizing this space.
"Vets First Choice is the most noticeable example of that, followed by VetSource and Whistle. All three of those companies received around 90% or more of venture capital funding in the pet health area. I think the rest of the industry is under-funded. On the livestock side, Antelliq was recently acquired by Merck.
"If you look at what has happened in the agricultural space, when Monsanto acquired The Climate Corporation for $1 billion – after that, we saw a huge amount of capital moving into this space and a lot of start-ups being set up."
The Climate Corporation was a start-up founded in 2006. It focused on providing farmers with weather, soil and field data to optimize their crop yields. By 2013, Monsanto had swooped.
Mr Goossens said Silicon Valley investors typically like to look at large markets and could potentially be put off by the size of the animal health sector, which is "tiny" in comparison to the human health industry. He also said specialist knowledge is needed to understand the animal health space – something Silicon Valley investors may lack.
"Having said that, with some of these defining transactions with Vets First Choice and Antelliq, we will see more of the Silicon Valley investors stepping in," Mr Goossens stated.
Earlier this year, a Silicon Valley-based start-up secured $5 million in seed funding from local investors for its canine cancer treatment.
China may lead digital charge
Speaking in front of a host of technology-focused companies, Mr Goossens suggested China could be an indicator of the way animal health's online relationship will develop with farmers and pet owners.
"The digitization of commerce in regions like China is showing us markets and players can change overnight," he said. "If you look at China, everyone is connected to e-commerce and anyone gets to quickly order anything they want online.
"In China, over 30% of animal production farmers order their inputs through e-commerce – it's through apps like WeChat."
In fact, he said the number of mobile payments made in China during 2017 (around one trillion) was 10 times more than the amount recorded in the US.
Mr Goossens added: "I think Amazon has a great position because of its e-commerce platform. It is the natural place for pet owners to go to for their supplies. That platform can offer a whole lot more in addition."