6 ag tech start-ups to watch in 2020
Whether it’s a recently developed alternative to pest management that is affordable and sustainable or a new digital tool that monitors the health and well-being of animals, farmers are being bombarded by sales pitches from ag tech start-ups.
“The trouble is, a number of these companies claim their products will solve all of my problems without knowing anything about my operation,” says Lynn Rohrscheib, Rohrscheib Farms. “It also bothers me when a company tries to tell me that what I’m doing is wrong or what I’m currently using is outdated.”
As the creator of two ag tech start-ups, Corbett Kull says it can be easy to get on your soapbox and act like you recognize the issues farmers are dealing with. “In reality, you have to take the time to get out in the field and talk to farmers so you can truly understand the challenges they face and the solutions they’ve tried in the past,” says Kull, who founded 640 Labs and Tillable.
Making that effort goes a long way with Rohrscheib, who says she’s more likely to try a product once a rapport is built. Yet, establishing a relationship is not her only concern. Because many of these new solutions are seasonal, assessing and evaluating their effectiveness takes longer. “The biggest issue is that a number of these technologies aren’t field-tested enough,” Rohrscheib says.
Also lacking is tangible, field-level support. “You get one chance to leave a lasting impression,” says Wade Barnes, cofounder of Farmer’s Edge. “I’ve seen start-ups try to bank on an opportunity too quickly and fail to back up their technology with the infrastructure and support required to make it a success.”
a work in progress
“In many cases, farmers have become a bit jaded about the promise of technology and what it can actually deliver,” says Rob Leclerc, a founding partner at AgFunder.
Based in California, the venture capital firm has witnessed the challenges start-ups face in building technologies that farmers find useful in a more immediate way.
“Entrepreneurs have a lot of constraints,” Leclerc says. “They don’t start with millions of dollars. They don’t do R&D for 10 years. Oftentimes, they need data and field trials to even build their products. It’s a work in progress, and entrepreneurs need that real-world data to better understand a product’s strengths and weaknesses.”
With about 30,000 start-ups in its database, in a way, AgFunder faces the same problems farmers face. “We look at about 200 companies every month. We pass on most things because we recognize many just aren’t going to hunt.”
Since launching in 2013, AgFunder has invested in 32 start-ups across the ag and food tech value chain.
Despite the hindrances, the ecosystem is maturing. “In the early days, a start-up realized that in trying to solve one problem, it had to first deal with a number of other problems,” Leclerc says. “In order to do that, it had to build a whole stack solution. Although it would try to piece something together, the start-up massively failed or at least partially failed because it didn’t live up to the expectations.”
As different players entered the space, companies have come together to fill out that stack. “You don’t have one start-up trying to solve all of these problems. Partnerships are being formed to bring all of the different tools together into one interface, which not only fulfills the promise but also offers a better user experience,” Leclerc says.
The ones to watch
As the pace of change continues to accelerate, there are always going to be winners and losers. Here are six ag tech start-ups worth keeping an eye on in 2020.
Founders: Saad Ansari and Yasir Khokhar
Year Founded: 2015
Headquarters: Amsterdam, Netherlands
Background: Connecterra has created an artificial intelligence (AI) that helps dairy producers monitor the health and well-being of their herds. Its AI-enabled dairy assistant, IDA, uses a motion sensor attached to a cow’s collar – in combination with data sources – to create actionable alerts around animal health, heat, and operational changes.
“IDA uses deep learning and complex algorithms to process the data, which is then presented back to the producer as easy-to-understand, actionable insights in an app,” says Khokhar, Connecterra cofounder and CEO.
Funding: $4.9 million
2. Kiwi Technologies
Founder: Adam Bercu
Year Founded: 2017
Headquarters: Malden, Massachusetts
Background: Using a U.S. manufactured, large-format unmanned vehicle, the Kiwi Application System is the first autonomous aerial system to distribute the volumes of chemicals, seeds, and more required by commercial growers.
“With rates of up to 20 gallons per acre using industry-standard nozzles and spray patterns, the system delivers high-precision coverage without human error or inconsistency,” says Bercu. “Kiwi gives you the coverage you want, where you want it, all the way to the edge of the field.”
Funding: $5 million
Founders: Frances Arnold (2018 Nobel Prize winner), Pedro Coelho, and Peter Meinhold
Year Founded: 2013
Headquarters: Santa Monica, California
Background: Provivi is developing natural, affordable pheromone products to control pests and to protect crops like corn, rice, and soybeans. Pheromones serve as highly selective attractants for insects, which control damaging pests while preserving beneficial insects.
Because sustainability is one of the main pillars of the BASF strategy, its venture capital arm has participated in three financing rounds for the start-up. “Provivi’s patented process provides an affordable and sustainable pest-management alternative to farmers in regions where pests have become resistant to conventional pesticides,” says Markus Solibieda, managing director of BASF Venture Capital GmbH.
Funding: $135 million
Founder: Karn Manhas
Year Founded: 2010
Headquarters: Vancouver, British Columbia, Canada
Background: Terramera’s Actigate technology improves the performance of both natural and synthetic active ingredients used in crop-protection products, which results in less synthetic chemicals and higher-performing organic biopesticides. The company’s OMRI-listed, broad-spectrum pest-
control product, RANGO, is recommended for use on crops like corn, wheat, barley, and rye.
“Terramera’s technology fuses artificial intelligence, science, and nature to create game-changing solutions for agriculture and pest control that will better our lives and ensure the sustainable future of our planet,” says Manhas, founder and CEO of Terramera. “With our Actigate targeted performance technology, we are on the path to reduce global synthetic pesticide loads in agriculture by 80% by 2030.”
Funding: Approximately $80 million
5. Livestock Water Recycling
Founders: Karen Schuett
and Ross Thurston
Year Founded: 2012
Headquarters: Calgary, Alberta, Canada
Background: This patented nutrient recovery platform reduces the volume of livestock manure by concentrating nutrients into crop fertilizers and transforming the rest into clean water.
“Global food demands are increasing at a time when precious resources have never been more limited,” says Schuett, cofounder and CEO of LWR. “We learned that manure liquids are actually composed of 95% water, and it was this untapped water source that made us dive into this industry.”
The LWR team continues to find new ways to leverage its knowledge of wastewater treatment to make manure management smarter and food production more sustainable and productive.
“We are proud to bring disruptive modern manure-treatment technology to the next generation of farmers, so farmers can take care of the planet for the next generation of consumers,” Schuett says.
Funding: $3.5 million
Founder: Ken Jackson
Year Founded: 2016
Background: This start-up is tackling the problems of grain spoilage, grain quality consistency, and sampling difficulties with its VeriGrain automated sampling and data management system.
“Obtaining an accurate, representative sample is crucial to maximizing value and utilization of grain. Today, we are basing this on a random sample taken using a scoop on a stick,” says Jackson, Intelliconn founder and CEO. “VeriGrain ensures an accurate, representative sample is taken and then digitizes the information. So it is correct, complete, secure, and can be easily accessed, traced, and shared.”
The system includes two main components: an Acquisition module and a Splitter module. Small cross-cut samples are taken from grain flow through the Acquisition module and then transferred to the Splitter module. This module contains a sample splitter, which can divide the sample into up to six identical subsamples. The samples are placed in Secure Sample containers that are QR and RFID coded. The Splitter module also monitors grain volume, has a moisture and temperature sensor, a high-resolution camera, and a spectrometer.
All information collected is stored in the cloud and controlled through a smartphone app. Once in the cloud, the data is processed to determine the risk of spoilage as well as grain characteristics like protein and oil content.
“We see them really disrupting the grain data and analytics market,” says Marta Weinstock, marketing director, SVG Ventures|THRIVE.
Funding: $4 million
Where are they now: SmartAg
It’s been said we don’t learn from what we have to say; we learn from what others have to say. Listening to farmers’ concerns about labor scarcity led Colin Hurd to develop a long-term solution to a major problem facing agriculture.
“We asked farmers, if they could automate something in their operation, what would it be? When did they need the most help?” Hurd recalls.
The answers compelled the entrepreneur to launch Smart Ag in 2015. Featured in Successful Farming magazine’s “7 Ag Tech Start-ups to Watch in 2018,” one of the first applications for the platform was AutoCart.
A plug-and-play system, AutoCart, along with the SmartHP tractor automation kit, automates the grain cart tractor regardless of brand. A combine operator can set staging and unloading locations in a field, adjust speed, monitor location, and command the grain cart to sync to the speed and direction of the combine.
With 20 dealers in the U.S. and one in Canada, plus 15 units in the field in 2019, the Iowa start-up has made great strides. Yet, Hurd knew moving the business forward meant finding a partner with the resources to create a more comprehensive platform.
Recently acquired by Raven Industries, Smart Ag will now have access to assets it was challenged to find or create on its own. “Raven’s comprehensive platform helps us integrate and put the final touches on our system,” Hurd says. “We’ll also have access to steering and machine control systems for application equipment that we didn’t have before.”
The purchase helps Raven advance not only what it has developed to date but also accelerate its Raven Autonomy platform.
“Becoming fully autonomous is a progression. We believe we’re on the right path with our current technologies, but we are also looking for other companies to fill out different versions of that chain,” says Wade Robey, director of Raven Autonomy. “Smart Ag is an excellent example of that because it brings in technologies around perception, obstacle detection and classification, and operational control of a certain element of the autonomous solution that we think will advance our program significantly.”
A final product is expected to be commercially available in 2020.
3 Lessons Learned from an entrepreneur
Never satisfied with the status quo, Corbett Kull sees many areas that can be improved by technology, including agriculture. It’s also why he started two ag tech companies: 640 Labs and Tillable.
“I knew there had to be a better way to do things when it comes to planting data and farmland rentals,” Kull says.
The entrepreneur also knows there are some growing pains involved in getting farmers to adopt a new technology – no matter their age. “We just conducted our landowner survey, and 96% of participants preferred to do the survey by phone rather than online,” Kull says. “I think that says a lot about the industry’s willingness to trial new technology.”
Kull shares three lessons.
- Get to know your audience. “Breaking through won’t be easy,” Kull says. “Get out in the field and talk to farmers. Sympathize and try to understand what challenges they’re facing and the solutions they’ve tried in the past. Also, get to know a couple of farmers without trying to sell anything. They have really interesting things to say, so listen to them.”
- Be patient. “The seasonal nature of the business requires more patience,” he says. “Growing seasons differ based on what farmers you’re targeting and where. If you understand this cycle, you’ll know what’s important and when, which is helpful in communicating the right message at the right time.”
- Be prepared to spend the next five to 10+ years developing an innovation. “You have to be in it for the long haul and committed to making a difference,” Kull says.