Israeli ag analytics firm CropX has completed its third acquisition as part of its ongoing rollup of agrifoodtech startups. Its latest purchase is Dutch platform Dacom Farm Intelligence. Dacom brings 3,000 customers to CropX’s ledger as well as 20,000 farms in over 40 countries.
With the acquisition, CropX plans to establish a Europe office at Dacom’s headquarters in Emmen, the Netherlands.
The startup ticks several of CropX’s M&A boxes, according to the Israeli firm’s president John Vikupitz. The criteria that it looks for include being well-respected in local markets, having a strong management team that intends to stay with CropX, and complementary technology that delivers additional insights to the producer in the field.
Vikupitz underscores the ability of Dacom to fill in some of CropX’s tech gaps as a major selling point. CropX has been busy snapping up startups that pair well with its existing offerings. Other recent acquisitions include New Zealand effluent and irrigation management startup Regen in September 2020 and US yield optimization platform CropMetrics in January 2020.
“The capabilities that Dacom has when combined with the Regen effluent management module and CropX capabilities create a truly unique farm management platform focused on soil health and sustainability, which is not a focus of any current farm management system available today,” Vikupitz tells AFN.
Although CropX could develop some of the technologies that it is acquiring in-house, acquisitions offer a shortcut. All of the companies that it has acquired have been developing their tech and their reputations for at least a decade, by Vikuptiz’s count. This means that the startups aren’t just bringing solid technology to the table – they’re also bringing market expertise.
“It is very difficult to design a solution to a specific problem a producer faces, test and refine it, and gain market confidence in a short period of time. Our M&A strategy enables us to shortcut this challenge significantly,” he says.
More M&A is on the menu for CropX as it explores other potential additions to its platform. The emerging carbon credit space is one area has caught the company’s eye, and may soon become part of its offerings. Already, the tech it has acquired from various startups plays into capturing data around carbon, soil health, and general sustainability. Although Vikupitz claims it’s too soon to say for sure how CropX may enter the carbon credit space, he views it as an arena where the company could make a big contribution.
Despite offering a shortcut to expansion, expanding through M&A isn’t always a cakewalk. Some of the deals that CropX has done have been competitive, with other potential buyers throwing in bids. That’s to be expected when the target startup has a lot to offer, Vikupitz says. But CropX has managed to fend off the competition.
“We believe we’ve been successful for a couple of reasons: a shared vision about the future with the acquired firms’ founders, and an opportunity to be part of a bigger global organization focused on delivering exceptional products to producers,” he says.