Most chicken meat is sold by contract, but about 10-20% is sold on the spot market, a labor-intensive process that requires a lot of phone calls.
“There’s a sense of drudgery,” said Janette Barnard, Founder & CEO of The Poultry Exchange. “Less than 10% of the volume takes 40% of the time.”
And the buyers and sellers in the market are wary of one another.
“It’s interesting the kind of people in this space,” Barnard said. “There is a bit of a lack of trust on both sides of the aisle.”
The Poultry Exchange is an online marketplace connecting commercial chicken buyers and sellers, making them more efficient and able to respond quicker to changes in the market.
“Chickens are not widgets,” Barnard said. “We want to take advantage of market swings.”
How Poultry Exchange works
Chickens average about 8 pounds per bird, but sometimes opportunities come up for 8 ½ pound birds on the spot market.
“That’s an extra four or five loads you hadn’t planned on,” Barnard said. “You need to find a place for the extra birds.”
Buyers and suppliers interact through open exchanges (available to all buyers), closed exchanges (only select buyers), or a specific buyer product request open to all suppliers.
“[We] move that process online so buyers and sellers have an efficient way to connect,” Barnard said. “They have a real-time way to know what the market’s doing from a price standpoint.”
Membership options include individual or corporate. Buyers pay the membership fee only, while suppliers also pay per transaction.
“It’s a hybrid subscription model on a plant basis as well as a commission per transaction,” Barnard said. “Suppliers have the most to gain.”
Finding the right problem
Before she had the idea for a poultry marketplace, Barnard knew she wanted to start her own business.
“I worked in the pharmaceutical industry in animal health sales, calling on poultry companies,” Barnard said. “I left to go to business school and got bit by the entrepreneur bug.”
She reached out to her network in the ag industry looking for a problem to solve.
“I asked what problems exist that you wish someone would solve,” she said. “This came up four times in one week.”
Further conversations with buyers and sellers validated the problem.
“I asked, ‘How big is the problem and what would the solution look like?’” Barnard said. “Yeah, this is an issue.”
Connecting with VentureTech
Barnard, whose company headquarters is in Dallas, turned to Lincoln-based VentureTech for help with the platform.
“I grew up on a farm in Arizona,” Barnard said. “I didn’t have somebody with technical expertise down the road.”
An entrepreneur with an idea but no technical co-founder fits VentureTech’s model.
“I interned with a startup in College Station, Texas and heard a speaker from VentureTech,” Barnard said. “I was really impressed with their approach to relationships with their portfolio companies and B2B applications.”
Barnard considers VentureTech to be part of her team.
“They’re functioning both as CTO and our engineering team,” she said. “They have the expertise in building out B2B applications, ensuring privacy and security.”
The platform is currently in beta, a process Barnard expects to last at least a couple more months.
“We’re getting ready to release new versions of the software and get user feedback,” she said. “There’s no defined time frame.”
Since Barnard started working on the company in 2015, The Poultry Exchange has grown from 6 plants and 15 buyers initially to 18 and 45 today, respectively.
“We’ve grown that base,” Barnard said. “But there are some changes we need to make in product design.”
Barnard hopes to not only streamline processes, but also revive a sense of trust.
“We’re bringing transparency and efficiency to the marketplace,” Barnard said. “And we want to restore that sense of integrity in the market and bring joy back into the space.”
Rod Armstrong is Vice President of Strategic Partnerships for AIM in Lincoln, Nebraska. He is a regular contributor to Silicon Prairie News.