8 Ag Tech Start-Ups Worth Watching in 2019

As you look across the ag tech landscape, the number of companies vying for farmers’ attention seems to continuously be on the rise. It’s also creating fatigue.

“Farmers are being inundated with ag tech solutions,” says Seana Day, who serves as a Partner at Better Food Ventures. “One thing we’ve noticed in the last year or so is how much fatigue there is around the different technologies and point solutions. It’s tough to sell farmers on hot, new technology right now. It really has to provide tangible value by way of cost savings or yield increase.”

As an early adopter of ag technology, Tom Farms has embraced a number of innovations from their humble beginnings. 

“If our operation is going to be a part of tomorrow’s agriculture, we need to be looking at these solutions today,” says Kip Tom. "We believe in participating with numerous players in the space to see what`s best in class in any technology. While we have a lot of great start-ups in the United States providing solutions to us, we like to look globally and see what other tools are out there."

For example, Tom Farms recently began working with Solinftec. The Brazilian company has developed a farm operating system with a suite of apps that tells equipment operators where and when they need to be.

"They`re really focused on equipment optimization and want to bring in the ability to support blockchain technology along the way," says Tom. "What`s impressed me most about this company is its willingness to adapt to U.S. crops and its interest in listening to producers to help its product be more intuitive for the user."

While the Indiana-based operation is pleased with the results it’s seeing from the Solinftec technology, not all of what they’ve tried has been successful. Through a lot of trial and error, Tom says they quickly learned what they needed to look for in a new technology.

“There have been several ag technologies sold with a lot of promises, but for whatever reason aren’t delivering on those promises. That happens in every industry,” he says. “As farmers, we first need to understand what the technology delivers. Does it have applicability to my farm? Will I see a cost benefit by using this technology? What is the future growth of the technology?"

What it comes down to, explains Day, is as farmers sift through the myriad start-ups, they must decide whether it is a nice to have or a need to have solution. It’s a question Better Food Ventures asks every time it evaluates a company. Established in 2013, the California-based investors who make up Better Food Ventures look to identify and invest in companies that can improve the performance of the food and agriculture industries through the application of information and communications technology. 

“We always ask ourselves whether it is a vitamin or a pain pill for the end user,” explains Day, who has more than 15 years of investment, mergers and acquisitions advisory and technology experience and concentrates on production agriculture like in-field as well as post-harvest technologies.

The other issue, she adds, is that the ag tech sector has forced farmers to be the systems integrators.

“These companies are expecting farmers to figure out how to bring all of the various pieces of technology together and that’s a failing of the industry,” says Day. “From our perspective, those companies that can integrate or that offer multiple layers of data for better decision support are interesting.”

Evaluating a Start-up`s Viability

For the team at Moore & Warner Ag Group, there are three key questions they consider when evaluating the viability of a start-up.

1. Is an actual farmer(s) part of the co-founding team or in senior management?
2. What are the in-field, at-scale experiences and case studies? "Forty acres of trial in California is nice, but what about 5,000 acres in the Midwest?" explains Jonah Kolb, vice president at Moore & Warner Ag Group in Clinton, Illinois, where he leads business development and consulting initiatives. Kolb works with private and institutional investors building direct farmland portfolios and advises start-ups, private equity, and venture capital funds pursuing opportunities in production agriculture and agribusiness.
3. Is there an in-person local/regional support team in place?

Ag Tech Trends

In 2019, Kolb says they expect more traction on farm management systems/ERP as providers have improved products, prices have come down for smaller operations, and farmers, including a millennial generation increasingly involved in management, are more focused on enterprise management.

"The joint venture between Rabo AgriFinance and Conservis is an interesting peek into the future," says Kolb. "We`re going to see more technology implemented because insurers, lenders, land investors, and end consumers simply expect and demand it from their farmer counterparts. That starts to change the adoption paradigm of selling technology directly to farmes."

In addition, he notes that there will be more interest in grain marketing programs and solutions. "Marketing discipline and strategy really set farm operations apart in 2018, and there seems to be a greater interest in using technology to help execute marketing programs," he says.

Kolb also believes 2019 will be the year we start to lose the paper. "The ticket-free trip to the elevator is an exciting concept," he explains. "We expect to see more progress in 2019, as both technology and incumbents push to digitize more of this side of the supply chain. It doesn`t have to be blockchain and smart contract-related, but it might be."

No matter where you sit on the ag tech adoption curve, below are eight ag tech start-ups worth watching in 2019.