LatAm-based decision support platform Agrosmart has acquired BoosterAgro, an Argentinian startup that has developed one of the most popular agrometeorological apps in the region, according to the two companies. The details of the transaction are undisclosed
“We have been planning this for a while. We knew M&A would be a way for us to grow faster so we started scanning opportunities in Latin America and different countries,” Mariana Vasconcelos, CEO at Agrosmart, tells AFN.
“We had heard of BoosterAgro and we already used the app but we mentioned that we have an M&A strategy and that we are looking to grow faster and that’s when everything started,” she adds.
Founded in 2016, BoosterAgro claims over 250,000 downloads and 100,000 active users across LatAm. It is focused on providing agroclimatic content and tools. After the acquisition, it will also feature Agrosmart’s high-resolution forecast offering.
“The most powerful use they offer is having all of these different agrometeorological data points within one place that farmers can quickly access. We already work with climate and have our own weather forecast that is the most precise for Brazil. But BoosterAgro has so many other types of data.”
Following the acquisition, the companies now cover over 48 million hectares of farmland across nine countries. Agrosmart will also begin operations in Argentina, which will serve as a base for clients in Spanish-speaking countries.
“Argentina means a lot because it is a very big market for grains and so close to Brazil. Setting up an office there means we can penetrate the market better and support growth for other Latin American countries,” Vasconcelos says. “But it’s also important because BoosterAgro has the largest user base in Latin America right now. So it’s a great opportunity for us to have access to that market and to be able to bring a more complete solution.”
Finding the right growth strategy
Founded in 2014, Agrosmart describes itself as the leading platform in digital agriculture for emerging countries. Its main goal is to provide agronomic insights for the entire agribusiness supply chain while helping farmers achieve a greater level of sustainability.
The platform collects data from different sources, including soil sensors, drones, and satellite images to generate agronomic models based on the genetic material, soil type, and microclimate of each field. Its software analyzes these raw data and then uses machine learning algorithms to make recommendations on everything from seed placement to climate modeling.
Agrosmart claims that its technology has helped farmers produce savings of up to 60% water and 20% energy.
It has caught the attention of some big-name clients, too, including Cargill, Syngenta, Coca-Cola, Corteva, Nestle, and AB InBev. It also closed a $5.8 million Series A round in 2019 from Brazil’s second-largest banking giant Bradesco’s Inovabra Ventures fund, as well as computer manufacturer Positivo Tecnologia’s corporate venture arm.
And while many startups struggled during 2020 due to the pandemic, Agrosmart reports 90% growth year-over-year thanks in part to integrating all of its offerings into one place. It also started distributing credit in partnership with Banco Bradesco with favorable interest rates for farmers.
In a way, the pandemic helped drum up interest in Agrosmart’s services.
“More people started looking for tools so they can have better transparency, better resilience, and be sure that they can continue to produce with social distancing limitations. A lot of farmers couldn’t be at the farm all the time and didn’t have as many employees, so there was a real need to automate decision making and remote monitoring.”
M&A is a big part of Agrosmart’s growth strategy on top of its in-house R&D and data science efforts. The startup even hired an outside firm to help scan for promising companies that are a good fit.
“We believe agriculture is a challenging market in which to grow. When we look at the different technologies out there, adoption is lower than we would like it to be,” Vasconcelos explains.
“They’re all flying very spread out and accessing them is hard. That’s why we usually make partnerships with corporations. We understand it will be quicker if we find teams that have pieces of the puzzle already solved with market penetration and adoption.”
The LatAm Agrifoodtech Scene
Agrifoodtech investing has been growing in LatAm, which is home to some of the most productive agricultural regions in the world. SP Ventures has become an active player in the scene. It recently closed on over $25 million for its latest fund with animal nutrition company Adisseo and US miner Mosaic and added the World Bank as a backer.
Solinftec raised $60 million led by the “Amazon of LatAm” in a record-breaking Series B round during 2020. Agrofy was hot on Solinftec’s heels with a $23 million Series B while small-scale startups in the region like AgroUrbana also attracted investor support.
The Yield Lab LatAm recently announced its latest cohort, which it put together despite the challenges that the pandemic posed while PepsiCo also announced a partnership with IDB to promote the inclusion of women in LatAm’s agriculture industry.