Michael Burton of Binary Beer Explains
If there was ever a passionate entrepreneur, it is Michael Burton of Binary Beer. Binary Beer uses the IoT and wireless solutions to help brewers ensure draught beer remains fresh, and kegs never go missing.
Ever since high school, Michael had loved building electronic things in what he called his “lab.” He dreamed of one day having a team working together, creating great things.
He studied for a degree in electronics and computer science at the University of Wollongong, an Australian public research university in New South Wales. From there, he worked as a software architect for seven years.
His wife introduced him to beer drinking and the vast selection available. That led to him becoming an enthusiastic home brewer. In 2013, Michael and his wife started a side company growing healthy yeast for the home brewing market, called Digital Home Brew.
However, when it came to the moment when they were expecting their first child two years later, they decided it was time to launch a big business for the family’s future.
The Initial Problems to Solve
As a homebrewer, Michael had found one of the biggest issues was kegs running dry when you needed them most, when friends came round. Michael started pulling on his computer and engineering background to find a solution that would tell you how much beer was left.
Another problem for brewers, small and large, is the volume of kegs lost. A production run of beer can be ready with nothing to put it in because the barrels are scattered, outside a customers’ waiting for return, in the cool-room, or even stolen and never to be seen again. The costs of this can be vast.
The Early Journey and first Solution
Michael thought that the best solution would be to make the beer kegs tracked to show both where they were and how full. Solving this would be the basis of the business they would build.
At this point, both Michael and his wife had profitable careers, and they also had a house they had bought and were planning to move into. Michael even had a Lotus, though with a child coming, he recognized that was going to be subject to a lifestyle change whatever.
Instead of playing safe, they opted to finance the business by going all in. Not only did Michael sell the car, but the house as well. Michael doesn’t question the reasoning behind this. However, he does say that in retrospect, it was one of their mistakes because of timing. They sold the house when they were both still employed, so they had to pay huge taxes on it.
The money enabled them to join iAccelerate Business Accelerator and Incubator, which operates out of Michael’s old University of Wollongong. Michael says that the accelerator provided a massive amount of mentoring, which they badly needed as they knew absolutely nothing about running a business.
They were one of the first projects to use the Digital Living Lab at Wollongong University. At that point, they worked on sensors to track the location and the temperatures using a LoRAWAN network to transmit the data. Only nine months later, the first kegs were going out for use.
During their time with iAccelerate, they were doing a lot of pitching and getting really useful critique back. Michael remembers some mentors saying the company would never work. Other outcomes were more positive.
They founded Binary Beer and won a trip to go to The States to explore the markets there. When pitching during that trip, Michael realized that some of the feedback saying they were too niche was incorrect. They could go global because it wasn’t only the home brewing market that was affected by problems of loss and lack of beer kegs, but big brewers as well.
They quickly produced a grant-funded MVP after the accelerator, though Michael says that the early prototype for a local brewer was full of problems. There was little or no wifi still, the bars wouldn’t share their passwords, and the equipment often got stolen. It was not yet scalable.
As technology improved, they moved from LoRaWan to Vodafone to track the kegs. Since that point, they have focussed on developing the tech. Michael could see that the new wireless tech was so cutting edge and could enable tracking in a whole new way.
Now, connecting to the IoT means everything is developing at a colossal rate. The reach and scope of what is possible are already utterly different from what it was two years ago. Wireless has evolved to reach dead areas, such as deep in trucks. They have developed tech to reach areas that GPS did not function
After the US, they went to Germany and found out how they could do business there, learning the legal systems. A chance call came on another day from someone in Kenya. Michael admits he initially thought it was a scam, but the person the other end persevered. They wanted help for a brewery in Kenya and promised Michael he would be safe if he came out and visited. Michael has since been back several times, and they have become a major partner. It is strange, Michael muses, how a random unexpected phone call can turn into something massive.
Binary Beer was starting to attract attention. They had interest from some of the world’s largest brewers. More and more, they could see that commercialization could be on a colossal scale.
How Binary Beer Works
What started as a keg tracking device turned into a SMART keg. This development means the company can help solve two more problems.
One issue for brewers is that however perfect their beer is originally if it is poorly handled or stored by the user, the quality will be affected. Breweries have had no way to defend the quality of their product.
The second pain point is all the time spent in the sales process. The inventory work was time-consuming and often inaccurate. Now, the SMART kegs take the guesswork out of inventory management.
The brewer knows where the kegs are, how they are being stored and handled, how full they are, and when they can be retrieved to be refilled. Keeping the brewer connected throughout the cycle, and using data analytics and machine learning to reveal new insights, truly revolutionizes the production of beer. Production, sales, distribution, and finances all benefit.
KegLink sits in a bracket on top of the keg. These wireless devices monitor location, temperature, keg-tapped status, and movement, all in one tool, and zero paperwork because the readings are fed back by wireless. By calculating the heat, it can even tell how fresh the beer is. It is very robust, so it keeps transmitting even after knocks in transit.
These days, Binary Beer is working with international brewing conglomerates in Australia and globally. They have been to the UK to do trials, but at the minute, the wireless development is not far enough along.
Australians love their beer. Wireless technology is maturing in Australia, so the combination is perfect, making beer and tech the ideal partnership. However, already their global development is outstripping their home market. Michael sees a future within two and ten years where all kegs will be connected, as the price of doing so falls and the value of doing so grows. They are creating a real global change.
Under the same overall company, they have developed a second brand named Binary Tech. Their abilities have revealed a market scope beyond what they envisaged, as if influencing the global draught beer market isn’t enough.
Binary Tech is developing all aspects of the tech further and applying it to new verticals. There are so many items that suffer from a high loss rate that will benefit. They are currently working on pallets; gas bottles will follow and hire equipment.
I asked Michael if they have an exit plan. He explained that beer is a very consolidated market, with just a few companies controlling it. He could see early on that the quickest way to scale would be to work with one of the huge breweries, and that might make an exit plan as well. It would be possible for them to split Binary Beer and Binary Tech out in the future.
It is a joy to Michael that he has developed something so scalable that it impacts so many people. In addition, he can build a team around him who share that passion. He has never once regretted what they did. His enthusiasm for it is still as great as on day one.
Michael says that he feels he ought to advise others to avoid taking the risks they did and play it safe. But he can’t do it. He does warn of is how tough it can be in the early days. It was for Binary Beer, especially financially. Michael says that, therefore, his advice would be that you need to really care about what you do to take that risk.
Because of how much he cared, he never hesitated, never questioned what they were doing. Stopping was never an option. What they were doing, he explains, was simply too good to stop.
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