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FBN’s $300m Series G with Fidelity, ADM brings ‘validation’ to oft-controversial company

November 18, 2021

Californian agtech startup Farmers Business Network (FBN) has raised $300 million in Series G funding at a valuation just shy of $4 billion.

That’s more than double its valuation in August 2020 when FBN, which is both a fintech marketplace for farmers and a data analytics platform for online grain and inputs, raised $250 million. It’s also reflective of the growth in FBN’s farmer network during the same 15-month timeframe, from 12,000 farms to 33,500 across the US, Canada, and Australia.

An impressive group of global investors committed to the round. Led by the $4.2 trillion asset management group Fidelity Investments, steel magnate Lakshmi Mittal’s family office, Colle Capital Partners, Walleye Capital, and hedge fund manager Paul Tudor Jones’s fund Tudor Investment Corporation all joined as new investors. But it was the addition of global grain trader Archer-Daniels-Midland (ADM) to the investor roster that caught the most attention.

First major agrifood company to invest in FBN

An ADM spokesperson told AFN that the company was “the first major food and ag company to have been invited to invest in FBN.” The startup has been a vocal proponent of disrupting the agriculture industry since its inception in 2014, with its calls to cut out the middleman, particularly ag input retailers, prompting ire from parts of the industry. ADM said the invitation was “testament to the breadth and depth of the collaboration opportunities the two companies envision.”

Investing an undisclosed amount, ADM said it had also “signed a non-binding letter of intent” to partner with FBN in a few core ways. Central to a partnership is FBN’s Gradable platform, which measures and verifies the carbon footprint of crops as well as the implementation of other sustainability practices like regenerative agriculture. Gradable sells that differentiated grain for a premium as low-carbon, no-till, regenerative, etc. ADM says it will help FBN find markets for those crops “to meet demand for responsibly produced, low-carbon intensity crops and products.”

The partnership creates the opportunity to “sell sustainable crops at scale” and create an “absolute market leader” in this area, Charles Baron, co-founder and chief innovation officer at FBN, told AFN.

“What’s exciting about the partnership, more than just the endorsement and passive support with financing, is that the truly senior executive level of ADM is looking to the future of ag and creating digital infrastructure to benefit farmers as much as possible,” he said.

Baron added that the line-up of experienced capital markets investors — which also includes existing backers like BlackRock, Temasek, GV, DBL Partners, funds and accounts advised by T Rowe Price — was a positive sign for the company and the industry, as the participants are known to evaluate companies on their fundamental economics as well as being long-term, patient investors.

This round is a major validation of the potential, but also the reality, of FBN,” he said.

Looking to the future with ADM

ADM and FBN are also partnering on research around new biological input alternatives, seed traits, fertilizers, and crop protection products, as well as bringing ADM’s lesser-known portfolio of fertilizer and animal nutrition products onto FBN’s e-commerce platform.

The two groups are working on an arrangement that could provide FBN with access to ADM’s physical distribution network. FBN has made major investments in the warehousing and logistics infrastructure needed to ship its growing number of agricultural products to farmer customers. Baron said the company “started from scratch” but now has 25 facilities that it manages or operates. While FBN can already tell customers when their shipments will arrive — a game-changer for farmers that have consistently struggled with a lack of information due to complex, multi-party supply chains causing delays and opacity — Baron says it wants to go beyond best-in-class farm delivery to have logistics on a par with consumer e-commerce platforms. Perhaps ADM’s extensive supply web and infrastructure globally can be helpful there.

“ADM supporting FBN is really substantial and the first time one of the absolute largest grain buyers in the world gets behind the movement we’ve been creating with farmers,” Baron added.

“It has not always been an easy road with a lot of folks in the ag industry; we’ve faced numerous obstacles, including collisions in Canada and other barriers to serving farmers transparently. A lot of the major players, mostly on the input and retail side, went to great lengths to block and stop us, doing everything they could.”

When asked if he’d change anything about FBN’s approach over the years, Baron said he would not – but indicated he would have liked to have known how much real infrastructure the company needed to build to carry forward its e-commerce plans.

AFN understands that FBN is targeting an IPO in the near term.

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