The round was profiled on AgFunder, the online investment platform, and attracted a range of individual investors alongside goFARM, which is backed by Robert Costa. Costa is chairman of goFARM and a member of the Costa Group family. AgFunder was a key advisor on the raise.
SWIIM, which stands for Sustainable Water and Innovative Irrigation Management, aims to help farmers use their water more efficiently and even conserve it by giving them a clear picture of how much water their crops use.
The software was developed in collaboration with the US Department of Agriculture, Colorado State University, and Utah State University, and enables farmers to create specific crop plans for their land based on its unique characteristics and water resources.
The technology also helps farmers monetize conserved water through the grid to other users, including local water managers like municipalities. And this could mean an extra source of revenue for them.
AgFunder Co-Investment Fund III is now open for investment. Closing June 15, Spots are limited.
“Many people don’t realise that the water coming out of their taps is paid for by their municipalities, which need to find a water supply,” Kevin France, SWIIM’s CEO told AgFunderNews. “Often that supply comes from agriculture, where rights are a tangible personal property that can be sold or leased.”
The company recently partnered with Western Growers Association, one of the largest grower organisation for California, Arizona and Colorado, to pilot SWIIM across the region, and the company will use this funding round to expand its reach in the state and put more permanent deployment in place, according to France.
“We’ve looked all over and can’t seem to find anyone else doing everything that we are doing,” he added in a statement. “SWIIM is a package that takes the agronomics side of the business — the planning, cropping and related decision-making process — and looks at it from a water resource management perspective. To do it any other way would be like trying to put a jigsaw puzzle together with pieces missing.”
For Liam Lenaghan, managing director at goFARM, investing in SWIIM was about the company’s potential to establish a previously non-existent temporary water allocation market in the western US and elsewhere. This could close the gap with Australia, which already has a fully functioning water entitlement system, despite using far less water for agriculture.
“The volume of water applied to irrigated agriculture in the US is 20-times bigger than the entire water rights held in the Murray-Darling Basin; Australia’s food bowl,” he told AgFunderNews. “California’s agricultural water use alone is 4-times the Murray-Darling Basin. It is a massive market and which is only dwarfed by the enormity of their supply-demand challenges.”
This is the first non-Australian investment for goFARM and Lenaghan will join the board of SWIIM.
“Liam and his team have been an amazing asset – with a targeted background which I believe will help catapult our model here in the US, and elsewhere,” said France, who said he turned away investment from a few private equity firms, which offered less reasonable terms for the company and little “value-add”.
“GoFarm is bringing intellectual capital to the mix and we are really looking forward to working with them,” he added. “Australia is the case study: the country went through a severe drought and had a restructure of how water is distributed, so they have hard-knocks knowledge about what we’re dealing with in the US.”
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