The deal is also the first exit for Monsanto Growth Ventures, the agribusiness’s venture arm which has been investing since the beginning of 2013 and led the $1.2 million Series A round for VitalFields in May 2015.
“When we invested in VitalFields we knew they could be an acquisition target if everything worked,” said Kiersten Stead, MGV partner and board member of VitalFields. Although this exit was sooner than expected.
VitalFields is an enterprise resource planning tool to help unburden farmers of the paperwork involved in farming, particularly around applying for European Union subsidies. The platform aims to enable farmers to enter data about their operations easily into their ‘fieldbook’ to meet the reporting requirements necessary in the EU. This is particularly helpful for complex and diversified farming businesses, added Stead.
“Farms in Europe are a patchwork of languages, regulatory jurisdictions, subsidy schemes and reporting laws. If you are an average farm in Europe, you may have land than spans regulatory regions, and have incorporated farm businesses that come under different regulatory/subsidy schemes, such as a “Green” farm, a “Young Farmer Regime” or perhaps a “Conventional Farm corporation.” In all, you receive around 60% of your income from subsidy regimes derived from a complex set of regulations and filing systems — typically done on paper — and now automated by Vital Fields.”
We are democratizing access to venture capital. Learn how you can invest with us.
Climate Corp, which has no presence in Europe yet, will leverage its existing sales and distribution teams in Europe to sell VitalFields as a separate entity initially. It plans to start offering beta versions of the FieldView platform in Europe in spring 2017 and later wants to integrate VitalFields into its FieldView product suite.
“As with man smaller startups, distribution and access to growers can be limited and that’s what we bring to the table,” said Mike Stern, CEO of Climate Corp. “We see VitalFields as a neat vertical to complement our FieldView product suite. There are tens of billions of dollars associated with the reporting requirements around subsidies in Europe, so this is a big part of income for growers across western and eastern Europe.”
While VitalFields automates much of the reporting process for farmers, they are still manually entering the information. Eventually, Climate hopes to use data collected from the farm — off sprayers, planters, sensors and so on — to automatically fill in the details needed. Earlier this year Climate announced it was launching an integrated sensor network, much like how Apple opened up the iPhone to independent application providers, to provide a hub for agtech providers to essentially sell their wares, at the same time capturing their data and integrating it into the FieldView platform. This will take several years to play out, however.
VitalFields is not the only startup offering this service to farmers, but it’s one of the most developed, according to Stead.
The acquisition provides an exit for other investors too including the Estonian Development Fund, SmartCap, an Estonian VC, and Jersey-based TMT Investments. To avoid any conflict of interest, particularly when it came to valuation, MGV did not participate in any discussions surrounding the acquisition.
While venture capital exits in the agtech market may seem few and far between, there are more than you think. Contribute your exit data ahead of our 2016 AgTech Investing Report here.