Pest detection technology company Spensa Technologies has closed a Series A round of funding on $2.5 million after raising the round from existing investors.
The investors first committed to the company during a $1.3 million convertible note round last year and most of them re-invested at Series A, according to Johnny Park, CEO of Spensa Tech.
Robert Laikin, a well-known businessman in Indiana as co-founder and CEO of BrightPoint, the wireless devices company, alongside a group of high net worth individuals, led the round. Other investors include mTerra Ventures, a new VC focused on building a sustainable economy, VilCap Investments, the venture arm of incubator and accelerator group Village Capital, and Elevate Ventures, an Indianapolis-based firm.
“We didn’t really reach out to conventional venture capital firms because we knew we weren’t going to raise much more than $2.5 million,” Park told AgFunderNews. “We felt this was just enough to get at least a couple of years of runway and all the existing investors were eager to invest more.”
The proceeds of the raise will be used to build out the team from 35 people currently, and to build on the “significant” corporate partnerships it has begun to form with strategic players such as AgReliant Genetics, a seed research and production company, crop protection companies such as Bayer and Syngenta, and large ag retailers and cooperatives, according to Park.
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Spensa Tech’s core hardware product is the Z-Trap, an insect sensor which has been on the market for three years already, but it is still at a small scale manufacturing level which Park wants to scale up between now and 2017.
The company is also building out its software platform OpenScout, which focuses on precision pest management by collecting manual observations of insects, disease and weeds, providing insights on the likelihood of those pests emerging in the field, economic implications, and optimizing pesticide spray programs.
Is Spensa Tech concerned about the growing number of precision agriculture tools in development? “Not too much. Most of them are involved in measuring moisture, temperature, and other environmental data, which is relatively easy. We feel that detecting insects is pretty difficult and we have been working on this innovation for several years; there are very few companies focusing on pest management specifically.”
The company recently held a forum with farmers and other stakeholders that are using its Z-Traps and OpenScout to get their feedback on the product and areas for improvement which was very informative, according to Park.
In 2015, Spensa Tech is expected to bring in $2 million in revenues, which is a bit higher than initial estimations, according to Park.