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Cannabis Cultivation Sensing and Data Company Raises Seed Capital

January 11, 2016

Phyto Partners, a cannabis-focused venture capital fund, has made its second big investment in ag technology in the past three months, after investing in startup Grownetics.

Grownetics, a hardware and software company, was established in Denver, Colorado eight months ago to help cannabis, and other indoor growers, monitor and manage their crops to boost yield.

It aims to build a community of cultivators, helping them to save time and reduce risk in their cultivation through hardware sensing and automation, algorithms and tips and tricks.

“Grownetics not only monitors a multitude of sensors, but they also use machine learning algorithms to automate the grow facility,” Larry Schnurmacher, Phyto Partners’ managing partner, told AgFunderNews. “The company’s management was also very knowledgeable and passionate about bringing agtech to the cannabis space.”

Grownetics’ technology can be used in any and all cultivation and Schnurmacher compared it to a self-driving Google car; explaining that the competition is like Google Maps, which offers recommendations and a big picture on how to get to a destination, whereas the Grownetics system decides for you. 

“Phyto expects this company to offer to growers a technology that significantly reduces costs while at the same time maximizes yield,” Schnurmacher said. “Grownetics will be a must have ‘Operating System’ for any and all grow operations.”

As the first external investor in Grownectics, Phyto Partners is very bullish for the year ahead.

“We expect Grownetics’ proof of concept and beta customers to validate Grownetics’ value proposition creating an extensive backlog of installations as the premiere agtech operating system,” Schnurmacher said. “We believe with proper execution and market acceptance, Grownetics will capitalize on, and could dominate, the cannabis cultivation Artificial Intelligence space.”

Eli Duffy, Grownetics’ co-founder and CEO, told AgFunderNews that Phyto Partners’ investment will go towards hiring more technical talent and support more sales and installations.

“We will continue to install, innovate, and scale our product offering. We have a variety of new sensors we will be integrating for our customers (previously unavailable). And expect to be a powerful force in streamlining/optimizing indoor agriculture as a whole,” he said. “In 12 months we will be gathering oceans of aggregated and anonymized strain specific crop data, and component-specific energy data. As we gather more and more quality data from the best growers and CEA facilities, we will for the first time be able to demystify what’s working best, and what the most efficient way to grow indoors is.”

In October, Phyto Partners made a strategic, seed investment into New Frontier, a Washington DC-based business intelligence and big data service for the growing legal cannabis industry.

Investment in cannabis is gathering pace as increasing numbers of states start to legalize its use for medical purposes and even recreationally.

Keep an eye out for the AgFunder 2015 investment report for more details on this growing investment sector.

Have news or tips? Email [email protected]

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