Syngenta Ventures has acquired a minority stake in Premier Crop Systems (PCS), a Des Moines, Iowa based agronomic software tool in a growth equity investment round. The investment comes after months of Syngenta using the tool in multiple field trials. Syngenta was joined by some early investors in PCS.
This marks the company’s first round of external funding since early investment from angel investors around the company’s founding in 1999. The company has grown on revenue alone since then.
PCS CEO Dan Frieberg told AgFunderNews that funding in the early aughts wasn’t available for agronomic decision-making software and what seems like a rare concept today — organic growth through revenue — was the only option for the nearly 20-year-old company.
“[Agtech] has turned into such hot space and there is so much money pouring in that there are a lot of companies really struggling to find any kind of a revenue model. It’s sort of an ‘If you build it, they will come strategy.’ Back when we started that wasn’t possible,” said Frieberg.
Gabriel Wilmoth of Syngenta Ventures agreed that the company does not have the same characteristics as many agtech startups today. “They have a nice history of growth and profits but are relatively under the radar. You would not think of them as a flashy, Silicon Valley-type precision ag play.”
PCS makes several tools for agronomists to help farmers make more informed and quicker decisions around farm inputs. PCS’s core software program creates multi-level reports to help growers understand yields across their entire farm. Grower reports look at yields historically as well as by soil type and variety grown, among other factors, and then PCS enables comparison to aggregated data from other farms on the platform.
PCS says that the platform analyzes these three levels of data, the individual field, the entire farm, and other farms, finding correlations within the data to help growers make decisions and changes. PCS’s newest product is a software-as-a-service to helps growers and agronomists perform large-scale, replicated trials, to make better decisions about new methods, techniques and products in their fields.
PCS’s new product “Enhanced Learning Blocks” allows growers to test a new strategy or input on a one or two acre section of their field with a newly added feature for randomization and replication.
“For companies that want to prove their products, it becomes a way to do that at scale. For growers it’s refreshing because a lot of what they’re sold is on trust. Growers will gladly risk one acre of higher or lower rates just to verify that something works,” said Frieberg.
Earlier this year, Syngenta tested Enhanced Learning Blocks in multiple field trials and the company’s Digital Agriculture R&D Agronomy Lead Chuck Foresman said it was a scalable solution for field research.
Wilmoth praised the efficacy of the product, telling AgFunderNews that PCS is “bringing rigor and scale to on-farm research in a way that is somewhat intuitive, but very powerful in the end.”
Frieberg acknowledged that creating a product for both buyers and sellers of agricultural inputs is a good spot to be in for what he called his “19-year overnight success.”
Pricing for PCS products varies depending on both the customer and the intended use.
Syngenta has made various investments in the precision agriculture space in recent years such as in 2016, Syngenta Ventures invested in Israel’s Phytech, a platform for irrigated crops that uses soil moisture and microclimate sensors, and spatial imaging, to give farmers a view of water stress conditions in the field. And in 2015, Syngenta acquired precision ag platform AgConnections.
Wilmoth said that in a crowded landscape, not every new tool really offers growers value. “There’s a lot of stuff out there, but far less that really fits in the grower’s operation: real tools that growers are willing to pay for that deliver ROI.”