Farmers Business Network (FBN), the agtech startup that counts GV (Google Ventures) and Kleiner Perkins Caufield & Byers as investors and has over $200 million in venture funding to-date, is now investing in startups.
The agribusiness marketplace and data platform has invested in AgriSecure, a Nebraskan startup that helps row crop farmers transition to organic farming.
Despite the rapid growth of organic foods, the US is a major net importer of organic grains from countries such as India, Turkey, and Romania; in the major grains, 99% of US farm acreage is in conventional, non-organic production.
Transitioning from conventional to organic acres is an arduous and expensive process that takes at least three years. AgriSecure was born out of a fifth generation farm that converted acres to organic, experiencing the complexities of the transition and the documentation needed to successfully do it.
The startup provides whole farm and field level budget planning & execution, organic farming expertise including training and coaching, certification and recordkeeping, and help with crop marketing.
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“This is an exciting moment for AgriSecure and for US farmers who are facing low profits and limited options,” said J.P. Rhea, founder & CEO of AgriSecure in a statement. “Organic grains, done correctly, can allow growers to capture terrific premiums – we’ve proven it on our farms.” AgriSecure says that prices for organic grains are two to three times higher than conventional grains. AgriSecure also aims to provide farmers with full traceability for their clients.
“By providing buyers state of the art traceability, it enables food companies to manage their organic supply chains domestically, at scale, and with field-level traceability,” said Charles Baron, FBN co-founder.
FBN has a network of 24 million acres of member farms in the US and Canada that receive comprehensive farm benchmarking, seed performance data, input optimization and pricing analytics. It also sells a range of inputs including seed and pesticides as well as helping farmers to sell their harvest through its crop marketing platform.
Through its investment and partnership, FBN will market AgriSecure’s services to its farmer clients and will host AgriSecure training events at FBN Summer Clinics in Iowa and Nebraska this summer.
Clients that transition to organic will become potential customers for FBN’s organic inputs business, but will also help to fill demand from organic buyers — bolstering FBN’s crop marketing business too.
“Our crop marketing program has two main components: commodity and ‘Identity Preserved’ specialty, and we’ve had a lot of interest from organic buyers who struggle with sourcing,” FBN’s spokesperson Megan Fallon told AgFunderNews. “So really you have two core problems this helps solve; farmers who’ve struggled with the transition and business of organics, and buyers who have unreliable supply chains. ”
“The partnership brings a number of things to FBN, but most importantly, it brings our members a way to profitably diversify their farm. Strategically, it allows us to work with organic crop buyers at much greater scale, which creates new security for buyer crop access. For farmers, FBN Direct can provide a full suite of organic inputs and financing for organic production. Combining our technology platforms enables us to make organic compliance easier than ever, as well as bring FBN data science analysis to organic production,” Fallon added.
How have FBN’s conventional agriculture clients reacted to this partnership? Fallon says that many of them have been looking for ways to diversify and increase revenues.
“FBN has the most forward-thinking farmers in North America as members. Many of them have been coming to us knowing they need to do something different, to de-commoditize themselves and set them apart from others to not only stay in the black but also to find additional premiums,” she said. “Many conventional farms have been interested in organics for quite some time, but because of the documentation and complexity that comes with transitioning, they have not taken the leap. AgriSecure simplifies the process with its end-to-end management, and the ability to manage organic acres at scale.”
FBN does not have any specific plans to invest in more startups but will do so again if it makes sense strategically, according to Fallon.