

This inbreeding was deemed necessary in order to fix the traits being sought in the breed. Hektor was inbred with another of Horand's offspring and produced Heinz von Starkenburg, Beowulf, and Pilot, who later sired a total of 84 pups, mostly through being inbred with Hektor's other offspring. Fathering many pups, Horand's most prolific was Hektor von Schwaben. Horand became the center-point of the breeding programs and was bred with dogs belonging to other society members that displayed desirable traits and with dogs from Thuringia, Franconia, and Württemberg. By 1923, the Verein für Deutsche Schäferhunde claimed 50,000 dues-paying members in more than 500 branches in Germany alone. In just a few decades of the Verein für Deutsche Schäferhunde's establishment, the breed became one of the world's most popular and numerous, a position it has maintained to this day. Horand was declared to be the first German Shepherd Dog, and was the first dog added to the society's breed register.

After purchasing the dog he changed his name to Horand von Grafrath and von Stephanitz founded the Verein für Deutsche Schäferhunde (Society for German Shepherd Dogs). He was pleased with the strength of the dog and was so taken by the animal's intelligence, loyalty, and beauty, that he purchased him immediately. Hektor was the product of few generations of selective breeding and completely fulfilled what von Stephanitz believed a working dog should be.

In 1899, von Stephanitz was attending a dog show when he was shown a dog named Hektor Linksrhein. He admired the intelligence, strength and ability of Germany's native sheepdogs, but could not find any one single breed that satisfied him as the perfect working dog. Max von Stephanitz, an ex-cavalry captain and former student of the Berlin Veterinary College, was an ex-member of the Phylax Society who firmly believed dogs should be bred for working. At the same time, the awareness of sheepdogs as a versatile, intelligent class of canine began to rise. With the rise of large, industrialised cities in Germany, the predator population began to decline, rendering sheepdogs unnecessary. While unsuccessful in their goal, the Phylax Society had inspired people to pursue standardising dog breeds independently.

The society disbanded after only three years due to ongoing internal conflicts regarding the traits in dogs that the society should promote some members believed dogs should be bred solely for working purposes, while others believed dogs should be bred also for appearance. To combat these differences, the Phylax Society was formed in 1891 with the intention of creating standardised development plans for native dog breeds in Germany. The results were dogs that were able to do such things, but that differed significantly, both in appearance and ability, from one locality to another. It was recognised that the breed had the necessary skills for herding sheep, such as intelligence, speed, strength and keen senses of smell. In Germany this was practised within local communities, where shepherds selected and bred dogs. Dogs were being bred to preserve traits that assisted in their job of herding sheep and protecting their flocks from predators. During the 1890s, attempts were being made to standardise dog breeds.
