What business models are working in Pet Tech?
In our Pet Tech market deck, you will find everything you need to understand the market
SUMMARY
The Pet Tech business models working best today are veterinary SaaS, connected hardware with required subscriptions, premium automation with recurring add-ons, and pet-care marketplaces where repeat bookings dominate.
The strongest models all make the second dollar easier to earn than the first. A clinic renews its software, a tracker stays connected, a sitter gets booked again, or a household that already owns an expensive device buys software, supplies and accessories around it.
Veterinary software currently has the cleanest economics in the category. Clinics use these systems every day, revenue is heavily recurring, and switching becomes progressively harder as medical records, billing, diagnostics, communication and staff workflows accumulate inside the same platform.
Consumer hardware works best at two extremes. Either the recurring service is essential to the device, as with Tractive's cellular GPS trackers, or the hardware itself solves a painful enough problem to support appliance-level pricing, as Whisker's Litter-Robot does.
The weaker middle ground is the generic connected gadget. A device that generates one sale, little follow-on revenue and no meaningful switching cost leaves the company going back to the advertising market for the next customer almost immediately.
Rover shows that marketplace economics depend more on repeat behavior than on simply reaching scale. When 84% of bookings came from returning customers, an already-acquired relationship was generating most of the platform's activity; Wag's much heavier marketing burden produced the opposite outcome.
Telehealth becomes more convincing when another organization controls distribution. Employers, insurers and veterinary groups can bring thousands of users into a service at once, avoiding the difficult economics of repeatedly advertising an occasionally used veterinary service directly to individual pet owners.
Pet data is becoming commercially important, but only certain data deserves to be called an advantage. Longitudinal health, behavioral, clinical or genetic information tied to individual animals is much harder to recreate than a large collection of disconnected device measurements.
AI is mostly strengthening existing Pet Tech business models rather than creating a new one. It gives Tractive, Whisker, Furbo and veterinary software companies additional features to retain customers or justify higher subscription tiers, particularly when the AI can use proprietary pet histories or clinical data.
Insurance looks more useful as a distribution partner than as a business Pet Tech companies need to own. Reimbursing or subsidizing preventive devices can improve adoption while leaving underwriting, claims and capital requirements with companies already built to manage them.
The broad pet super-app has much weaker evidence. Expansion works when a company reuses something it already owns — a device in the home, a tracker on the animal, a clinic workflow or a trusted marketplace relationship — but simply putting unrelated pet services under one brand does not create much economic advantage.
The recent pullback in pet-sector funding therefore looks more like a quality filter than a collapse in Pet Tech demand. Pet spending continues to grow, but investors increasingly want proof of retention, margins and repeat monetization instead of paying for downloads, devices shipped or a long list of possible future services.
This market map, featured in our Pet Tech market deck, highlights top companies and startups in the pet tech market
What counts as a Pet Tech business model that actually works today?
A Pet Tech business model works when the first customer payment leads naturally to more revenue later, with evidence that customers actually keep using and paying for the product.
That definition rules out a lot of companies that look successful from the outside. Funding, app downloads and units shipped tell us that a product attracted attention. They say much less about whether the economics eventually work.
The stronger examples show repeat behavior. Tractive built a large paying base around GPS trackers that require connectivity subscriptions. Rover disclosed that 84% of its bookings in its last reported third quarter as a public company came from returning customers. In IDEXX's latest results, recurring veterinary software, services and imaging revenue reached $76.3 million for the quarter, close to four-fifths of the category's total revenue. Whisker follows a different route: it can make serious money on the physical product itself because customers will pay $599 to $899 to automate a job they otherwise do every day.
So we use a fairly demanding test throughout this article. We want to see scale plus recurrence, repeat transactions, strong hardware economics or some other mechanism that makes the next dollar easier to earn than the first one. That's what separates a good Pet Tech product from a business model that has actually proved itself.
Is Pet Tech still growing while investors pull back?
Yes. Pet spending is still growing while investors have become much more selective about which Pet Tech and pet businesses they will fund.
The latest American Pet Products Association figures put U.S. pet spending at $158 billion in 2025, up 3.7%, with spending expected to reach $165 billion in 2026. Around 95 million U.S. households owned at least one pet. The underlying consumer market remains enormous.
Investment moved in the opposite direction. PitchBook data reported by GlobalPETS show roughly $899.5 million of global pet-sector venture investment and acquisitions across 262 deals in 2025. That was down 14.2% in value from the previous year, while deal count fell from 301 to 262. The contrast with 2021 is even bigger: that year recorded 465 deals.
Weak funding therefore tells us less about weak pet demand than it once did. Consumers keep spending, while capital has become harder to obtain for companies that cannot explain their margins, retention or route to profitability.
That environment is actually useful for answering our question. Tractive still became attractive enough for Bending Spoons to acquire it. Digitail raised $23 million after more than doubling its customer base in twelve months. IDEXX continues to grow recurring companion-animal revenue at double-digit rates. Meanwhile, Wag reached Chapter 11 after years of trying to broaden its monetization.
Pet Tech is going through a quality filter. The category is alive; investors simply want more proof.
As this chart shows, and as featured in our Pet Tech market deck, search interest in pet cameras has risen sharply
Can expensive Pet Tech hardware make money without forcing a subscription?
Yes. Premium Pet Tech hardware can work very well on its own when it removes a frequent and annoying task that owners already spend time doing.
Whisker is the best example. Its current Litter-Robot range starts around $599 for the EVO, reaches $799 for Litter-Robot 5 and $899 for Litter-Robot 5 Pro. Those are appliance prices. Yet Whisker says more than two million robots have been sold globally, and the company has reported more than $300 million in annual revenue.
The reason is fairly simple. Cat owners already clean litter boxes. The Litter-Robot saves labor several times a week, often every day, so the buyer can understand the value before opening an app or seeing any AI feature. That's a much easier product to justify than a connected gadget whose main advantage is simply being connected.
Whisker is now adding recurring layers around that installed base. Whisker+ costs $7.99 per month or $79.90 per year and adds longer-term behavioral analysis, activity summaries and, on compatible models, advanced camera features. The company also sells litter, liners, filters and accessories such as the $129 LitterHopper, with some products available through repeat delivery.
The order is important. The hardware earns its place in the home first, then subscriptions and consumables increase lifetime value. Whisker has also continued widening distribution, recently opening an official TikTok Shop storefront as part of a broader social-commerce push.
For premium Pet Tech hardware, this is currently the most convincing route: solve an expensive or repetitive household problem first, then monetize the installed base again where the extra product genuinely adds value.
Is hardware plus subscription the best consumer Pet Tech model right now?
Hardware plus subscription is probably the strongest consumer Pet Tech model today when the recurring service is essential to what the device actually does.
Tractive has built this model more cleanly than almost anyone else. Its trackers use cellular networks to transmit location and health data, so a subscription pays for a real ongoing service. The tracker brings the pet onto the platform; connectivity, monitoring and health features keep generating revenue afterward.
The company had already reached more than 1.4 million active users when it acquired Mars Petcare's Whistle wearable business. It has since moved deeper into health monitoring, adding products such as CAT 6 Mini and DOG 6 XL and expanding AI-generated health summaries, heart-rate monitoring, respiratory-rate monitoring and other behavioral signals. The latest generation still requires a subscription.
Bending Spoons completed its acquisition of Tractive this year, giving us another useful validation point. Bending Spoons specializes in acquiring digital products with large user bases and recurring monetization, so buying a hardware-linked subscription company fits that playbook very neatly.
Furbo is pushing even harder toward the same economics. Its current U.S. offers heavily discount the camera when customers take Furbo Nanny. A Furbo Mini can cost only a fraction of its standalone list price when bundled, while the recurring Standard plan is billed at roughly $84 for the first year and then renews at a higher annual amount. Furbo is effectively willing to sacrifice hardware revenue to acquire a subscriber.
Whisker sits at the other end of the spectrum. A $79.90 annual membership is small relative to a $699 to $899 litter box because Whisker still earns substantial value from the appliance itself.
| Pet Tech company | Hardware economics | Recurring layer | What the model tells us |
|---|---|---|---|
| Tractive | Tracker gets the pet onto the platform | Required connectivity and health subscription | Subscription is the core long-term engine |
| Furbo | Cameras can be heavily discounted with a plan | Furbo Nanny AI and video subscription | Hardware increasingly behaves like customer-acquisition cost |
| Whisker | $599 to $899 premium appliance | Optional $79.90/year Whisker+ plus consumables | Hardware remains the main product, recurrence lifts LTV |
| Petcube | Low-cost connected cameras | Cloud monitoring and care plans | Low hardware price makes recurring services more important |
If you want more recent data on this point, please see our latest Pet Tech market report.
This chart, included in our Pet Tech market deck, shows annual VC investment in pet tech startups
Can pet-care marketplaces actually make money?
Yes. Pet-care marketplaces can make very good money once repeat bookings become much larger than first-time bookings.
Rover's last public numbers show what that looks like. During the third quarter of 2023, Rover recorded 1.807 million bookings worth $266.4 million in gross booking value. Only 290,000 were new bookings. The other 1.517 million came from customers who had booked before, taking repeat bookings to 84% of the total.
That mix changes the marketplace economics. Rover still has to attract new pet owners and caregivers, but a large part of every quarter's activity comes from relationships the platform has already acquired. A pet owner who trusts a sitter can book that person again for another trip, weekend or workday without Rover rebuilding demand from scratch.
Rover was collecting a recognized take rate of 23.6% at the time. Quarterly revenue reached $66.2 million, up 30% year over year, while adjusted EBITDA reached $17.5 million. That works out to a 26% adjusted EBITDA margin.
Blackstone subsequently bought Rover for approximately $2.3 billion.
The core of the Rover model is frequency plus trust. Pet sitting, boarding, daycare and walking happen repeatedly, while reviews and previous experience reduce the owner's risk each time. Once enough supply and demand exist in a city, marketplace liquidity becomes a real advantage.
Early-stage marketplaces face the opposite situation. They need to spend money attracting both sides while still offering fewer providers, fewer reviews and less availability. Pet marketplaces can become excellent businesses, but the economics improve sharply only after the network becomes useful enough to generate its own repeat activity.
Why did Rover work while Wag went bankrupt?
Rover built a high-repeat marketplace with visible operating leverage, while Wag kept spending heavily to support a much weaker revenue base.
The contrast is unusually useful because both companies competed for similar pet-service spending.
Rover's third-quarter 2023 revenue grew 30%. Repeat bookings represented 84% of bookings. GAAP net income reached $10.5 million on $66.2 million of revenue, and adjusted EBITDA margin reached 26%.
Wag's 2024 numbers looked completely different. Revenue fell 16% from $83.9 million to $70.5 million. Sales and marketing alone cost $45.9 million, equivalent to roughly 65 cents for every dollar of revenue. Wag reported a $17.6 million net loss.
Wag had already diversified beyond walking and sitting. Its filings described revenue from caregiver service fees, Wag Premium subscriptions, registration fees, wellness products, affiliate revenue and other pet-related businesses. The wider product range failed to produce strong enough economics.
The company filed for Chapter 11 protection in 2025 and restructured around secured lender Retriever. By then, the difference with Rover was hard to miss.
Rover shows how powerful the marketplace model becomes when existing customers generate most activity. Wag shows how ugly the same category can become when the company still carries a huge acquisition and marketing burden.
| Metric | Rover | Wag | What we learn |
|---|---|---|---|
| Latest comparable revenue trend | +30% YoY in Q3 2023 | -16% in 2024 | Marketplace growth was moving in opposite directions |
| Repeat behavior | 84% of bookings were repeat | No similarly strong disclosed repeat metric | Repeat activity is central to marketplace economics |
| Profitability | 16% GAAP net margin, 26% adjusted EBITDA margin | $17.6M net loss on $70.5M revenue | Similar services can produce radically different outcomes |
| Sales and marketing burden | Strong operating leverage visible | $45.9M, about 65% of revenue | Customer acquisition can consume the whole model |
| Outcome | Acquired for about $2.3B | Chapter 11 restructuring | Category alone tells us very little about business quality |
This chart, included in our Pet Tech market deck, looks at Tractive’s strategy in pet tech
Is veterinary software the best Pet Tech business model today?
Veterinary software currently has the strongest overall Pet Tech economics we can see because clinics use it every day, pay repeatedly and become increasingly reluctant to replace it once the system runs the practice.
The freshest IDEXX numbers make the case unusually clear. In its latest quarter, veterinary software, services and diagnostic imaging systems generated $96.3 million of revenue, up 12.2% year over year. Recurring revenue inside that category reached $76.3 million, roughly 79% of the total, and grew 10.7%.
Across the first six months of 2026, recurring revenue in that business reached almost $150 million. IDEXX says the growth came from a larger SaaS installed base, higher subscription volumes, integrated services and pricing.
Younger veterinary software companies are still taking share as clinics migrate away from older systems. Digitail raised $23 million after more than doubling its customer base in twelve months. The company says its platform now supports more than 10,000 veterinarians and three million pet parents.
The product also shows where the economics can expand. Digitail combines scheduling, medical records, invoicing, inventory, client communication, wellness plans and more than 15 AI workflows in one system. IDEXX connects software with diagnostics and imaging. PetDesk has built a large clinic footprint around booking, reminders and client engagement.
Each added workflow creates another reason for the clinic to stay. Moving a calendar is relatively easy. Moving patient histories, invoices, communication records, diagnostic connections and staff routines together is much more disruptive.
That makes veterinary software unusually attractive inside Pet Tech. The customer is a business, usage happens constantly, revenue recurs and the product can expand from one workflow into several. Right now, we would put this model ahead of consumer gadgets on pure business quality.
If you want more recent data on this point, please see our latest Pet Tech market report.
Can pet telehealth make money without selling directly to consumers?
Yes, but pet telehealth looks much stronger when employers, insurers or clinics bring the customers than when the telehealth company has to acquire every pet owner itself.
Airvet is a good example of why distribution changes the model. The company originally leaned more heavily toward direct consumer access, then shifted its attention toward employer benefits after examining profitability, margins and unit economics.
That makes sense for a service people use irregularly. Someone may urgently need a veterinarian twice in a month and then go a year without opening the app. Paying consumer marketing costs to find that person can be hard to recover from occasional consultations.
An employer solves part of that problem by buying access for thousands of people at once. Airvet has worked with employers including Adobe and Ceridian and says more than 3,000 veterinarians are available through its platform across the U.S. and Canada.
The same logic applies to insurers and veterinary groups. Telehealth can handle triage, follow-up questions, behavior issues and lower-acuity cases while a larger organization already owns the customer relationship.
Pet telehealth can work, but we would be cautious about the standalone "Netflix for vets" thesis. The more convincing model today is B2B2C: somebody with cheaper distribution pays to make virtual veterinary access available to a larger population.
This chart, included in our Pet Tech market deck, shows annual funding in pet tech startups
Can pet DNA testing become a real business with one test per animal?
Yes, pet DNA testing can support a meaningful business, although the strongest economics come from what the company learns from each test as much as from selling another kit.
Embark has already tested more than a million dogs, building a large genetic database while selling breed, ancestry and health information to individual owners. The consumer proposition is easy to understand and can support a relatively high one-off ticket.
The obvious ceiling is frequency. Most owners do not repeatedly DNA-test the same animal. Growth therefore depends on reaching new pets, adding new tests or finding another way to use the underlying data.
Zoetis's acquisition of Basepaws shows that second path. Basepaws built consumer genetics and health-risk tests for cats and later expanded into dogs. When Zoetis bought the company, it highlighted the genomic and microbiome databases as useful assets for future pet-health research and innovation.
One customer transaction can therefore create two forms of value: revenue from the kit and another labelled biological sample for the database.
The second part can become strategically important if the dataset helps identify disease associations, improve diagnostics or support new veterinary products. It also requires real scientific quality, enough samples and appropriate rights to use the data, so we would give this model less certainty than veterinary SaaS or GPS subscriptions.
Still, pet genetics has proved that low-frequency purchasing does not automatically mean weak economics. A one-time product can work when each sale also strengthens a research asset that grows with the company.
Is pet data becoming more valuable than the device?
For the strongest connected Pet Tech companies, the data layer is becoming at least as important as the original device because years of repeated measurements are much harder to recreate than another piece of hardware.
Tractive has moved far beyond "where is my dog?" Its current trackers monitor combinations of location, activity, sleep, scratching, resting heart rate and respiratory rate. The company says millions of pet owners now use the platform, giving it a very large stream of longitudinal behavioral information.
That data is already being used outside basic tracking. Tractive has worked with mammaly to study mobility, sleep and physiological indicators around pet health, and its newest products use AI to turn repeated measurements into health summaries and alerts.
Whisker is building a different dataset from inside the home. Its latest Litter-Robot products can track visit frequency, weight, waste patterns and individual animals. Litter-Robot 5 Pro adds cameras and AI-powered cat identification. With more than two million robots sold globally, bathroom behavior becomes a surprisingly large source of longitudinal pet data.
Veterinary software has an even richer context because the data can include diagnoses, medical histories, laboratory orders, treatments, invoices and communications. Genetics companies add another layer entirely through DNA and microbiome information.
We should still be careful with the word "moat." Collecting millions of low-quality data points does not automatically create one. The useful datasets are longitudinal, linked to individual animals, difficult to reproduce and good enough to improve the product.
That's where connected Pet Tech is heading. The device gets into the home or onto the animal, while more of the long-term value comes from what the company can learn over thousands or millions of repeated observations.
This chart, included in our Pet Tech market deck, compares the main business model options for pet GPS wearable companies
Can insurance become a strong distribution channel for Pet Tech?
Yes. Pet insurance is becoming an interesting way to subsidize useful Pet Tech products without forcing the technology company to become an insurer itself.
Tractive is currently giving us the clearest evidence. The company sold its own UK pet-insurance operation, yet it keeps adding partnerships with insurers that reimburse customers for using Tractive.
Uelzener in Germany began reimbursing eligible customers for Tractive subscriptions as part of preventive care. Similar partnerships have appeared with Musky in Spain and Calingo in Switzerland. Tractive also announced a partnership with Spot Pet Insurance in the U.S.
The incentives line up quite well. Tractive gets a distribution channel and another reason for customers to keep the subscription. The insurer can encourage monitoring and prevention. The owner receives technology at a lower effective cost.
This is especially interesting for health-oriented wearables because insurers already spend money when health problems become expensive. If better monitoring eventually proves that it catches issues earlier or changes care behavior, subsidizing the device becomes easier to justify.
We would still separate distribution from underwriting. Running an insurance balance sheet introduces regulation, pricing risk, claims management and capital requirements that have little to do with making trackers or software.
For most Pet Tech companies, insurer partnerships currently look more attractive than trying to own the insurance company too.
Is the Pet Tech super-app a bad idea?
Usually, yes. The broad Pet Tech super-app looks weak unless the extra services genuinely reuse the same customer relationship, data or infrastructure.
Wag is the warning. The company spread across pet sitting, walking, subscriptions, wellness, insurance-related products, pet-food affiliate revenue and other adjacent services. In theory, one pet owner could buy several things from the same platform. In practice, revenue fell and the marketing burden remained enormous before the company restructured.
Focused businesses have produced better evidence. Rover became very good at one repeated marketplace behavior. Tractive concentrated on connected pet wearables and then bought Whistle, a directly related competitor. Whisker has expanded from litter automation into feeding, consumables, monitoring and software, all of which can be sold around the same installed household relationship.
Those expansions share something concrete. Whisker already has a robot in the home. Tractive already has a tracker on the pet. Veterinary software already sits inside the clinic. A new product can reuse that position.
A generic pet super-app has much less to reuse. Owners have no obvious problem using Rover for sitting, Tractive for tracking, a local clinic for veterinary care and another company for insurance.
The better Pet Tech strategy today is usually to go deeper into a repeated problem before trying to own every dollar a pet owner spends.
If you want more recent data on this point, please see our latest Pet Tech market report.
This chart, featured in our Pet Tech market deck, illustrates revenue distribution by customer segment in the pet tech market
Is AI actually changing how Pet Tech companies make money?
AI is already increasing what Pet Tech companies can charge and bundle into subscriptions, but it has not produced a clearly superior standalone Pet Tech business model of its own.
Look at where AI is actually being deployed. Whisker uses it for cat identification, behavior patterns and more detailed monitoring around a premium appliance. Tractive uses machine learning and AI-generated summaries to interpret the huge stream of health and activity data coming from its trackers. Furbo puts AI alerts, video history and pet monitoring behind Furbo Nanny subscriptions.
In veterinary software, the commercial fit looks even stronger. Digitail now offers more than 15 AI workflows covering patient intake, medical-note dictation, record summaries and other clinic tasks. IDEXX and other veterinary software vendors are also pushing more intelligence into systems clinics already use.
In all of those examples, an existing revenue engine comes first. Hardware subscriptions, SaaS or premium appliances already have customers. AI gives the company more features to retain those customers, move them into a higher tier or make the core product more useful.
Standalone AI features will probably face tougher pricing pressure because transcription, summarization and image analysis are becoming easier for many software companies to offer.
Pet Tech companies with proprietary data and existing distribution have a much better position. Their advantage comes from combining AI with years of pet history, clinic records or device measurements that a generic AI tool cannot instantly reproduce.
Which Pet Tech business models are struggling today?
Standalone gadgets, expensive direct-to-consumer digital services and loosely connected pet platforms currently have the weakest evidence.
The first problem is easy to see in hardware. A connected bowl, toy or camera can attract buyers, but a company that earns once and then loses contact with the customer has to keep finding another household. If cheaper manufacturers can copy the functionality, margins can disappear quickly too.
Consumer digital health has its own acquisition problem. Fuzzy, which had raised substantial capital for virtual veterinary care, shut down in 2023. Airvet's later move toward enterprise distribution gives us a clue about where the pressure sits: a useful service does not guarantee good consumer acquisition economics.
Wag gives us the broader-platform version. Its many revenue streams failed to compensate for declining revenue and extremely high sales and marketing spending.
Across these weak models, the recurring problem is that customer acquisition keeps resetting. The next dollar requires another ad, another device sale or another consumer to discover the service.
Compare that with a clinic renewing veterinary software, a Tractive subscriber keeping a tracker connected or a Rover customer booking a sitter again. Existing customers do much more of the economic work.
That's the clearest dividing line we found in Pet Tech today.
If you want more recent data on this point, please see our latest Pet Tech market report.
This chart, included in our Pet Tech market deck, shows how pet telehealth app technology has evolved over time
Which Pet Tech models have the best economics right now?
Veterinary SaaS comes first today, followed by connected hardware with required subscriptions, premium automation with additional monetization, and dense pet-service marketplaces.
Veterinary software has the cleanest setup. Clinics use it constantly, revenue is recurring, switching gets painful as more workflows move into the system, and new modules can increase revenue from the same customer. IDEXX's latest numbers show this working at meaningful scale, while Digitail shows that newer cloud products are still gaining customers quickly.
Connected wearables come next. Tractive has demonstrated that relatively inexpensive hardware can open a multi-year subscription relationship, and its move from GPS into health monitoring gives it more reasons to keep customers paying.
Premium automation can also be an excellent business, although fewer products will qualify. Whisker can charge hundreds of dollars because Litter-Robot removes a task owners genuinely dislike, then sell software, accessories and consumables around the installed base.
Marketplaces can eventually become extremely attractive too. Rover reached strong margins because repeat bookings dominated activity, while Wag showed just how ugly the economics become when marketing remains too heavy.
Telehealth, genetics, AI and insurance are worth taking seriously, but today they work best as layers around another distribution advantage.
| Pet Tech business model | Verdict today | Why the economics work | Main risk |
|---|---|---|---|
| Veterinary SaaS / clinic operating system | Strongest | Recurring B2B revenue, daily use, switching friction, easy module expansion | Slow clinic migrations and competitive software market |
| Connected device + required subscription | Strong | Hardware acquires customer, service generates years of revenue | Churn can destroy the economics of subsidized hardware |
| Premium automation + software/consumables | Strong | High willingness to pay plus several ways to monetize installed base | Manufacturing complexity and high upfront price |
| Pet-care marketplace | Strong once dense | Repeat transactions, asset-light take rate, local network effects | Expensive and difficult before liquidity develops |
| B2B2C pet telehealth | Promising | Employers and insurers lower distribution cost | Irregular usage and regulatory differences |
| Genetics + proprietary datasets | Promising niche | Paid consumer test also grows a scientific data asset | Low repeat purchase frequency |
| AI add-ons | Useful revenue layer | Raises product value and can support higher subscriptions | Standalone features become commoditized quickly |
| Insurance partnerships | Useful distribution layer | Can subsidize preventive technology | Economic benefit still needs proof |
| Broad pet super-app | Weak evidence | Cross-sell looks attractive on paper | Different pet services often share little real advantage |
| Standalone smart gadget | Weakest | Simple product sale | Constant reacquisition, copycat risk, little recurrence |
So what business models are actually working in Pet Tech?
The Pet Tech business models working best today are veterinary SaaS, connected devices with necessary subscriptions, premium automation with additional recurring revenue, and marketplaces where existing customers book repeatedly.
The evidence is now fairly consistent across very different companies.
IDEXX shows how strong veterinary infrastructure can become when around four-fifths of software, services and imaging revenue recurs and the business is still growing at double-digit rates. Tractive has turned a wearable into an ongoing safety and health subscription used by a very large customer base, then attracted an acquisition by Bending Spoons. Whisker has proved that consumers will pay appliance-level prices for technology that removes a real daily chore, while software and consumables give it more ways to monetize the same household. Rover showed that a pet-services marketplace can reach strong margins once repeat bookings dominate.
The second tier is more conditional. Telehealth looks better through employers and insurers than through expensive direct consumer acquisition. Genetics becomes more interesting when every test also adds to a proprietary biological database. AI currently makes established products more valuable instead of replacing their underlying business models. Insurance is becoming a useful distribution channel for preventive technology.
The models we would avoid are clearer too. Generic connected gadgets have weak recurrence. Broad pet super-apps have produced little proof that unrelated pet services become better businesses simply because one company bundles them together. Any consumer Pet Tech company that still needs to reacquire almost all of next year's revenue through advertising starts from a difficult position.
The pattern running through the winners is simple: the first transaction creates an advantage for the second one. A clinic keeps its software. A tracker stays subscribed. A sitter gets booked again. A litter box creates demand for software, supplies and accessories. A DNA test adds another record to a growing dataset.
That's what is working in Pet Tech now. The technology matters, but the strongest companies have built their economics around what happens after the first sale.
If you want more recent data on this point, please see our latest Pet Tech market report.
In our Pet Tech market deck, we identify pain points entrepreneurs should prioritize
OUR METHODOLOGY
There is no single metric that tells us whether a Pet Tech business model truly works. A fast-growing company can still have weak unit economics, a popular device can generate little value after the initial sale, and a large funding round can say more about investor expectations than about the underlying business. We therefore broke the question into several economic dimensions that could be tested with evidence.
We looked at how revenue is generated after the first transaction, how often customers return or keep paying, how much a model depends on continually acquiring new customers, how deeply a product becomes embedded in a household or veterinary workflow, how an installed customer base can be monetized over time, and whether scale is translating into stronger economics.
Different models reveal those qualities differently, so we did not force every company through the same KPI. For marketplaces, repeat bookings and profitability are especially useful. For veterinary software, recurring revenue and workflow penetration matter more. For connected hardware, we looked at the relationship between device economics, subscriptions and the installed base.
We prioritized recent operating evidence wherever possible. That included financial filings, recurring-revenue disclosures, booking behavior, current pricing and subscription structures, customer and installed-base figures, acquisitions, distribution partnerships, funding rounds, strategic shifts and, where relevant, business failures. Older figures were kept when they remained the latest meaningful public disclosure, particularly for companies that were subsequently taken private.
No individual datapoint determined the ranking. We looked for convergence. Recurring revenue becomes more meaningful when it appears alongside continued growth and deeper adoption. A large installed base becomes more interesting when additional products can be sold into it. A marketplace looks better when repeat activity rises while profitability improves. High revenue or broad product expansion carries less weight when acquisition spending remains structurally heavy.
We also used comparisons selectively where companies served similar customer needs but produced very different results. Rover and Wag are the clearest example: comparing their repeat activity, growth, marketing burden and profitability helps separate the attractiveness of pet-care marketplaces as a category from the quality of the individual business model.
The final ranking is an analytical judgment rather than the result of a mechanical scoring formula. We gave more weight to demonstrated customer and financial behavior than to stated strategy, funding, product announcements or the number of adjacent markets a company says it can enter. The more independent pieces of evidence pointed in the same direction, the more confidence we placed in the conclusion.
Key sources used for the market and company analysis include the American Pet Products Association's 2025 U.S. pet-industry figures, GlobalPETS reporting based on PitchBook pet-sector investment data, Rover's Q3 2023 SEC filing, Wag's 2024 annual report, IDEXX's Q2 2026 results, and Digitail's Series B announcement.
For consumer hardware, subscriptions, data and distribution, key sources include Tractive's Whistle acquisition announcement, Tractive's 2026 health-monitoring product update, the completion of Bending Spoons' acquisition of Tractive, Whisker's current Litter-Robot lineup, Whisker's company history and revenue disclosure, and Whisker+ pricing and membership features.
Other sources used to test the more conditional models include Airvet's enterprise strategy, Airvet's veterinarian network, Embark's genetic-testing scale, Zoetis's reporting on Basepaws, Tractive's Uelzener insurance partnership, and Tractive's Spot Pet Insurance partnership.
This chart, included in our Pet Tech market deck, illustrates regional revenue distribution across Europe, Asia, North America, Africa, and South America in the pet tech market
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