In a nod to what might be termed the fast-growing field of plat-farming, North Carolina’s Growers Holdings–a farmer-founded, VC-funded agronomics software firm that makes seed, fertilizer, chemical and capital recommendations for farmers based on hyperlocal data–has been acquired.
The buyer is Israel’s ICL Group—the Tel Aviv-based, publicly listed manufacturer of specialty fertilizers and minerals that also produces one-third of the global supply of the chemical bromine and is the world’s sixth largest producer of potassium fertilizer, or potash.
In a statement announcing the deal, ICL President and CEO Raviv Zoller said the acquisition would expand and strengthen his company’s suite of agro-digital solutions to generate higher crop yields and bring about more efficient and sustainable agricultural practices.
“By combining Growers’ one-of-a-kind platform with ICL’s extensive agronomic know-how, we are accelerating our market reach and development roadmap to create an unparalleled digital service offering focused on providing agro-professionals with unique access to currently untapped and unstructured data in a simple, fast and actionable way,” Zoller said.
“Agriculture is an industry that impacts every person on the planet. Our belief is that there is significant opportunity to drive a more sustainable, profitable future through the better utilization of agriculture data,” said Growers Founder and CEO Steven Valencsin, who will continue to lead the company, post-acquisition.
Prior to its acquisition, Growers had received a 2018 Series A investment from Lewis & Clark Ventures, an early-stage VC that makes lead investments in U.S. heartland-based startups.
A bumper crop
The ICL/Growers acquisition marks the latest in a series of notable transactions just this year for startups in agtech and precision farming. The fast-germinating market for these high-tech applications is expected to reach nearly $13 billion in value, with a compound annual growth rate of 13%, by 2027.
Just this week, NewLeaf Symbiotics, a St. Louis-based startup that produces beneficial microbes, or M-trophs, to enhance row crop yields, announced the successful closing of a $20 million Series D funding round. Investors included Koch Agronomic Holdings, the agronomy VC arm of Koch Industries, and agtech heavyweight S2G Ventures, the latter known for its early support of plant-based alt-meat Beyond Meat. This latest funding round will be used to accelerate product commercialization.
Earlier this month, another Boston-area ag-tech startup Freight Farms, raised $15 million in a Series B round led by New York’s Ospraie Ag Science and existing investor Spark Capital, bringing its total funding to $28 million. The company, which operates in 44 U.S. states and 25 countries, builds vertical “smart farms” in hydroponic shipping containers. These container farms are linked to Freight Farms’ proprietary IoT technology platform known as Farmhand, which allows hydroponic growers to remotely manage their farms, automate farm tasks, and analyze data stored in the cloud.
In January, Indigo Agriculture, the Boston-area unicorn whose grain contract trading platform, Indigo Marketplace, has enrolled over 20 million U.S. grain acres since the company was founded 18 months ago, raised $200 million in a new round of bridge financing from new investors including FedEx and Pacific Western Bank.
Room to grow
Despite the recent spate of deal activity, ag-tech VC still has plenty of room to grow. Data from AgFunder has revealed that in 2019, private investments in agricultural technology startups totaled a mere $20 billion, or 7% of the total $300 billion global venture capital market, despite accounting for more than twice that proportion of global GDP.
While overall agtech investment declined moderately in 2019 after a record 2018, AgFunder has found interest in early-stage ag-tech investment to be resilient. This has been particularly true for startups in the “upstream” segment of the value chain, based closest to the farmland or food production site: a segment that includes agriculture biotech, robotics and equipment, bioenergy and biomaterials. Upstream ag-tech accounted for well over half of the $860 million of all seed-round venture investments in 2019.