Food safety goal for East Liberty startup FreshTemp
Jeffrey Rieger thinks his East Liberty startup company FreshTemp may be entering a market at just the right time.
Stricter food-safety regulations are pushing the restaurant industry to track and record food temperatures more consistently and more often. FreshTemp is one of the only companies offering the sensors, software and other technology in one package to easily meet expected government rules, Rieger said.
“Luckily, we're the only ones with the hardware right now,” the 26-year-old Rieger said last week from the company's one-room office and workshop above Baum Boulevard.
“But, unfortunately, we view that (advantage) as fleeting” because sophisticated temperature sensors coupled with data loggers and wireless technology aren't difficult or expensive to produce, he said.
In other words, it probably won't be long before he contends with competition from bigger companies. The electrical engineer, who first developed FreshTemp's sensors two years ago for a family friend's Wendy's franchises in the Pittsburgh area, said he is focusing his company on the software that analyzes data collected by his sensors.
“You can't prevent other companies from building the hardware,” because many sensor parts are off the shelf, Rieger said. “The way to differentiate yourself is around software.”
FreshTemp's software service aims to make it easier for restaurant owners to have confidence their food is being stored at an appropriate temperature.
Employees manually record temperature readings in coolers and freezers at most eateries, Rieger said. The process depends on workers remembering to check temperatures consistently and doesn't provide monitoring when the restaurant is closed. A temporary power outage in the middle of the night could cause food to spoil.
FreshTemp's sensors collect readings constantly and transmit the data wirelessly to smartphones or tablets, Rieger said. The software sends alerts if temperature variations are detected.
By next year, restaurants could be required to better track their food temperatures from the moment supplies enter the building to the time plates leave the kitchen under the 2011 Food Safety Modernization Act. The law, whose regulations are still being finalized, includes a host of measures aimed at preventing food-borne illnesses.
Rieger estimates that the fast-food industry's need for temperature monitoring equipment could be worth $150 million a year. He declined to disclose sales figures for his company but said FreshTemp has 37 restaurant customers in 10 states, including the family friend's nine Wendy's franchises.
But to capture a portion of the burgeoning industry, Rieger is going to need more of what is in short supply for most startups: money and help from talented people.
So far, he's gotten some of both from Innovations Works, a South Side organization that helps tech entrepreneurs start companies, and from Phil Marzolf, a Bridgeville business consultant.
FreshTemp was one of eight companies selected in November for Innovation Works' first AlphaLab Gear class. A major goal of the program is to get young companies to the point where they attract further private investment, or follow-on funding. Since 1999, Innovation Works has invested more than $52 million in 168 technology startups, which have gone on to raise more than $1.5 billion from investors.
The eight-month AlphaLab Gear program gives entrepreneurs up to $50,000 in startup financing, business mentoring, space where they can work and membership in TechShop, an East Liberty organization that provides equipment needed to build product prototypes.
Marzolf, an early investor in FreshTemp, is helping Rieger fine-tune his strategy and prepare to pitch to angel investors and venture capital firms. If he is successful, Rieger plans to use investor funding to hire more employees to grow the company.
“He had good technology, he knew what he was talking about, and he had some initial customer traction,” Marzolf said. “I want to partner with somebody who has the technical expertise ... but needs some help on the business side.”
There may be applications for FreshTemp's products beyond the restaurant industry, Rieger said. Companies that transport perishable food and the health care industry, which stores temperature-sensitive medicines, would benefit from automated temperature monitoring.
He hasn't figured out the potential market value for those two industries, but compared with restaurants, transportation and health care are “much, much bigger,” he said.
Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or email@example.com.