Local Pet Device Start-Up Inks Manufacturing Deal, Plans MN Launch
Burnsville-based start-up Anser Innovation recently announced that it has struck a deal with Winona-based RiverStar, Inc., to manufacture its PetChatz device.
PetChatz is a telecommunications platform through which pet owners can communicate with their furry friends remotely from anywhere in the world using an Internet-enabled device. Owners can even dispense treats and emit comforting smells remotely through the click of a button.
In addition to manufacturing, assembling, and packaging the device, RiverStar will handle shipping and warranty services for Anser. Financial terms of the agreement were not disclosed.
Anser CEO Lisa Lavin told Twin Cities Business on Friday that unlike most manufacturing agreements, RiverStar will purchase raw materials for the devices and cover costs associated with making the devices. Anser will then pay RiverStar after the devices are sold, meaning that it won't have to incur upfront costs associated with the manufacturing.
In addition to choosing RiverStar because of that unique arrangement, partnering with a Minnesota-based company also made sense from a logistical standoint.
“Having our manufacturing partner close by will allow us to resolve any issues faster,” Lavin said. “We try as best we can to partner with companies in Minnesota and take pride in the fact that we are building our business in Minnesota.”
Lavin said that the device will be available in stores in Minnesota and online in early 2013 before a national rollout a few months later, although she wouldn’t say precisely when the device will hit the shelves in Minnesota or when the nationwide launch of the device will occur.
“We are scaling up now and getting much closer to the launch,” Lavin said.
Earlier this year, Anser announced that Mahtomedi-based Chuck and Don’s Pet Food Outlet would sell the PetChatz device at its Minnesota and Colorado stores four weeks prior to a nationwide launch, but that agreement fell through. Lavin said Friday that Chuck and Don’s Minnesota stores will instead be part of the device’s statewide launch.
Lavin said she’s also in talks with several other “large retailers” and some smaller pet stores that are interested in selling the device in their stores and online but added that it’s too early to name them.
Anser signed an agreement last year with Perham-based Tuffy’s Pet Foods, Inc., on a co-branded treat pack for use with the PetChatz device. Lavin said that Tuffy’s products are sold at more than 4,000 pet stores across the country, including about 365 in Minnesota, and Anser hopes to tap as many of those pet stores as possible.
Lavin said the PetChatz device is geared toward “seriously afflicted pet owners,” about 30 percent of all pet owners, who spend 50 percent to 66 percent more on their pets than the average animal owner. PetChatz will retail for somewhere between $200 and $300, and Lavin expects Anser’s sales to reach between $35 million and $45 million within five years.
Anser also sees opportunity for its audio-visual technology to help loved ones assist aging adults with medication management. Lavin said Anser is in talks with potential partners, but nothing is set in stone yet in terms of development of such systems.
Twin Cities Business profiled Anser Innovation in its December 2011 issue after the company was named general division winner in last year’s Minnesota Cup entrepreneurial competition.