CEO/CFO Magazine

Apr 6 16Acknowledgements,Interviews,Panels,Press

SmartCatch16-CEOCFO-Article

Precision Fishing Technology –  Real-Time Digital Catch Monitoring System with Video and Sensor that Allows Fishermen to See Inside of their Nets

Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine

CEOCFO: Mr. Terry, would you tell us about SmartCatch?
Mr. Terry: SmartCatch is a technology company that is developing sustainable seafood productivity products.
Rob Terry Founder & CTO SmartCatch LLC.

CEOCFO: Would you give us a little background?
Mr. Terry: My background is in enterprise level hardware and software technology development. For example, I was director of e-commerce for Whole Foods. I have family in the fishing business and over the years, I have become increasingly more aware about the problems in the fishing industry. The government is enforcing stricter regulations with new quota systems making it harder for the smaller fleets to stay in business and for the larger fleets to stay profitable. Fish are becoming scarcer and harder to find. I have heard a lot about the types of products that the fleets are dreaming about in order to not only be able to not only be fish more successful but also to fish more sustainably.

CEOCFO: How does SmartCatch help?
Mr. Terry: SmartCatch is helping the fishing industry by developing a new breed of fishing equipment that is focused on supporting sustainable seafood production. We are producing a real-time video camera and sensor system that gives fishermen eyes inside of their nets. The problems that we are focused on solving are all about the indiscriminate nature of trawl nets. When fisherman cast their nets overboard, they have no idea what they are actually harvesting until they haul them back up on-deck and dump them out to have a look. Typically, one out of every fourth fish caught in a trawl net is the wrong (non-target) fish and is thrown back overboard dead and wasted. I recall an annual estimation of by-catch waste being around 27 million tons a few years ago. Our flagship product, DigiCatch, will give trawl fishermen transparency inside of their nets so that they can see what’s going on and be able to make more informed choices that enable them to be able to fish more efficiently and with less waste. This has many important implications in terms of the overfishing problems, rising costs and industry-wide profit losses.

CEOCFO: What is it that you can detect, thereby allowing a customer to make informed decisions?
Mr. Terry: We can help fishermen detect and prevent potential business disasters. For example, a few months ago Canary Rock Fish off the coast of Oregon were listed as overfished. Rockfish dwell on the bottom and sonars have a hard time distinguishing fish from the ocean floor. Fishermen usually make a test to see what kind of fish are in the area. The F/V Seeker decides to make a test run and ends up with a disaster tow catching about 47,000 pounds of Canary Rock Fish and the consequences were bad. He not only exceeded his quota for the next 4 years, but he also shut down the entire fishery for the rest of the season leaving about $5 million worth of product that nobody can fish for. He was not very popular in town after this incident and I heard that he is now out of business. If he had a way of seeing inside of his net, he would have seen the first bunch of rockfish coming in and he would have immediately been able to abort that tow, slow the boat down, pull the net up and change course. He would have caught some rockfish, but not enough to shut down both the fishery and his business.

CEOCFO: How can anyone determine that now, is there any way?
Mr. Terry: Fishing is typically a multi-generational vocation and these guys really know their business. They have great intuition and they also have sonar fish-finding equipment. Nevertheless, it is crap shoot each time they go out and tow their nets through the water. No one can say for certain what is going to end up in his nets. For compliance management, the government requires expensive on-board inspectors for trawler fishermen. The fishermen pay for the inspectors to wait around until their net comes back up on deck. Then they take their samples, do their documentation and determine the fines and penalties. The government hopes to manage fisheries from collapsing by reducing the number of boats on the water. I agree we need to manage our fisheries better. But what we need are more boats on the water that are not fishing blindly and indiscriminately because of a reliance on outdated technologies. What we need are more boats using smart technologies to help them reduce their bycatch by enabling them to harvest their target species with greater precision.

CEOCFO: What has been the challenge in creating something that would allow fishermen to see inside the nets? Mr. Terry: There were many technical challenges we needed to solve in order for us to develop a cost-effective productivity tool that will not only be easy to use but will also have the durability factor to operate flawlessly in an incredibly harsh environment. The work of a fishermen is really dangerous so work flow is a very important consideration. These people could be fishing at 3,000’, 4,000’, or 5,000’ feet underwater. At those depths, the crush factor becomes significant – image the weight of an armor car sitting on top of every square inch of the device.

Some of our other product challenges are; transmitting high frequency signals down a mile of deep-sea cable, having all the gear function properly in highly corrosive saltwater and dealing with the massive heat buildup that occurs from extra high-powered lights inside a closed tube. But all of that is nothing compared to the abuse of a burly fishermen tossing the device around on the iced-over heaving deck of a deep-sea trawler out on the bearing seas. None of these conditions are very forgiving for sensitive and sophisticated equipment.

CEOCFO: You have DigiCatch, SmartNet, DataCloud. Would you tell us about parts of your system?
Mr. Terry: DigiCatch is a state of the art video and sensor system for real-time monitoring of fish inside of trawl nets giving fishermen ultimate control over their tow. Our product is all about providing fishermen with the clearest possible picture in the constantly changing optically challenged conditions that exist underwater. For example, sometimes you really need to be able to see in the dark, DigiCatch has extremely high-intensity lighting plus a very low light sensitive cameras and digital image enhancement filters to help make this happen. But sometimes too much light is not good because it causes a lot of reflection off the fish scales and floating particles. We provide controls so that the fishermen can dial down the intensity and even change the color of the lights on-the-fly from the wheelhouse. Sometimes there is too much stuff floating around in the water coming directly at the camera. In this case, we provide a facility to rotate the camera around and look the other direction and get a much better view of the harvest. We also provide many onboard video enhancement filters for improving the video image quality. The system records the video and data stream and allows for on-the-fly annotations so that the operator can easily re-find footage that they are interested in. DigiCatch can easily integrate into our DataCloud platform. We will soon be offering data analysis services which can help fleet owners to optimize their operations. SmartNet will consist of remotely controlled escape panel system. Think of it as robotic appendages for trawl nets. It is still under development.

CEOCFO: Where are you in commercialization and usage?
Mr. Terry: We are still pre-revenue. We have successfully performed many sea trials off the coast of Oregon with DigiCatch. We are currently solidifying a contract to work with a very well established seafood industry leader. Our plan is to conduct commercial deep-sea trials on an industrial factory trawler that is working up in the Bering Sea. We are excited about working with our new partners and exposing our technology to extremely harsh and challenging conditions in order to ensure that all our gear works with 100% reliability and that fishermen can easily integrate it in into their daily workflow. We will take what we learn from our Alaska tests and finalize our production templates. We have talked with a lot of fishermen and suppliers that are very interested in our products. Our next step will be to dive deep into manufacturing, sales and support and we are actively looking for partners as we start to scale up.

CEOCFO: Are there organizations that you are able to work with or is that not viable in this industry?
Mr. Terry: There are a few organizations that we have had interaction with. For example, we have received a National Geographic ‘Ocean Initiatives’ grant, a USAID sustainable seafood technology award and we are members of The Future of Fish. Currently, we are finalists for an Edison Award for Sustainability. Fishing is a regional phenomenon and there are many groups that are organized by region and by type of fishing. There are local fishing organizations for trawler fleets in the Pacific Northwest that we are developing a relationship and starting to work with.

CEOCFO: What gives you the confidence that you can overcome the barriers?
Mr. Terry: My confidence is high that we will overcome the many challenges facing us because of all the enthusiastic conversations that I have had with many fishermen and researchers about our product vision. Everyone is looking for practical, cost-effective solutions for complying with strict government regulations. I understand their pain points and as an engineer, I know exactly how we can apply innovative technologies that will not only help them comply with regulations but it will also help them to become more profitable. The culture of the fishermen is rapidly changing. No longer is it about a secretive loan boat out in the sea. These days fishermen are banding together and forming co-ops to share information on places not to fish because of endangered or out of season results.
Public awareness the about the problems with the oceans is growing and consumers are demanding sustainably produced fish. Wild seafood is a diminishing resource that keeps getting more expensive to harvest. SmartCatch’s technologies are cost effectively solutions. The World Bank estimates that there is about $50B wasted from ocean production due to outdated technologies and poor fishery management. We are confident that we can help turn around what is rapidly becoming a global ecological disaster as a positive business opportunity.

CEOCFO: Would you tell us about the recognition from Edison Awards?
Mr. Terry: SmartCatch’s nomination for an Edison Award was a complete surprise. The Thomas Edison awards were inspired by Edison’s persistence, inventiveness, and ingenuity in shaping the global economy. The Huffington post calls them the “The Oscars of Industry”. The awards are given for the most innovative products in categories ranging from applied technology to medical breakthroughs. It turns out that someone from the nomination committee saw me speaking about sustainable fishing technologies at a Stanford University Food Technology conference. I am proud that SmartCatch has since been selected as a finalist in the ‘Sustainability’ category for DigiCatch, our digital catch monitoring product. The committee has also invited me to speak on a panel that will be sponsored by Caterpillar Marine. Award winners will be announced April 21, 2016, at the Edison Awards Annual Gala, held at the Capitale Hotel in New York City.

CEOCFO: Why is SmartCatch a necessary company?
Mr. Terry: SmartCatch is a necessary company because we are spearheading a new way of solving a very old problem. For example, back in the seventies when GPS was first introduced into the farming industry, it sparked a revolution. Now farmers have tractors that can drive themselves tilling, planting, harvesting and optimizing every inch of their operation. We are now firmly in the age of ‘Precision Agriculture’. The last huge change underwater in the fishing industry however was back in the 1940’s with the introduction of sonar. That advancement revolutionized fishing and lead to bigger boats and larger nets. Coupled with increasing consumer demand, this trend has facilitated more and more biomass being pulled from the ocean. But it also generated more and more bycatch being wasted. The price that we are paying is that we have reached a tipping point with fisheries and they are starting to collapse like dominos. According to scientists, we have already depleted about 70% of the fish stock that we have been depending upon for centuries. We cannot continue down the path we are on where we are blindly fishing and wasting so much of a diminishing resource because fishermen are using outdated technologies. It becomes a food safety issue and we can, and have to do much better. SmartCatch is producing and selling high-speed digital networks to fishermen so that they can connect their wheelhouse to their trawl- net, and this is game changing. First we will give fishermen real-time HD digital video capability so that they can ‘see’ inside of their nets in real-time. Next, we are developing the robotic appendages necessary for fishermen to discriminate and catch their target species with greater precision. We are entering into a new age of fishing and we are calling it the era of precision fishing.