**Update: Added comments Dan Burdett, global head of digital agriculture at Syngenta. **
Syngenta plans to acquire Brazilian farm management software platform Strider for an undisclosed sum, pending regulatory review by Brazilian authorities. This will be the second such deal for Syngenta in 2018 following the acquisition of remote sensing startup FarmShots last month.
Strider had been in discussions with Syngenta Ventures about their next funding round, which would have been a Series B, when CEO Luiz Tangari Pereira said that it became clear that an acquisition would be the best outcome for both parties.
“If we thought it would be best for the company to be independent, we would have been able to raise a Series B without trouble under a great valuation,” Tangari Pereira told AgFunderNews. “We thought it would be more intelligent for the company to join an ally rather than to stay independent for another two years.”
Strider will maintain its name and “will remain as an independent operating unit supporting Striders’ customers but also helping to build Syngenta’ digital offering in Latin America. Strider already has a suite of products that will complement Syngenta,” said Dan Burdett, global head of digital agriculture at Syngenta.
To date, Strider has raised $4 million in two funding rounds – a $1 million seed round from Brazilian VC Barn Investments and a $3 million Series A round from Qualcomm Ventures and Brazilian VC Monashees.
The price of the acquisition has not been disclosed, but Tangari Pereira confirmed to AgFunderNews that investors achieved a traditional VC “multiple” on their investments.
The company currently has 60 employees, all of which will transfer to Syngenta.
“There are a lot of synergies to explore, and we are better together than separate,” said Tangari Pereira. He explained that customers today are looking for one digital solution in one central location as opposed to several unlinked solutions for services like pesticide recommendations, financial management software, and remote sensing insights.
In fact, given that Strider’s customers are mostly medium and large farming operations in Brazil (larger than 5,000 hectares) Tangari Pereira said that the company’s growth strategy was based on a wide offering of services rather than rapid customer acquisitions.
According to the CEO, Strider counts six of the 10 largest agricultural operations in Brazil as customers along with around 700 other farms.
“I think it would take a long time to replicate what we have here,” he said.
The company currently has four products, with more still in development stages: Strider Protect, which helps growers make decisions around pesticide applications; Strider Base, which tracks operations throughout the year; Strider Space, which uses satellite imagery to identify problem areas and track historical performance; and Strider Tracker, a network of sensors and radio antennae to track machinery and implements in real time.
Strider’s capabilities and market penetration have already pitted Strider against Monsanto’s Climate Corporation, which has been expanding in Latin American over the last year. “In Brazil, if you travel to big ag cities, we are fighting with Climate head to head. Even before this acquisition climate is already our biggest completion,” Tangari Pereira told AgFunderNews.
That competition is likely to heat up with this acquisition, but Syngenta and Monsanto aren’t likely to have a two-man contest for long according to Francisco Jardim, managing director of SP Ventures, the most active farm tech investor in South America.
“This is the first digital ag acquisition in Brazil by ‘big ag.’ It follows the first major Series A VC rounds by foreign investors in the region (Agrofy and Solinftec). With three to four years of delay, Latin America is clearly entering the global ranks of the agtech ecosystem,” Jardim told AgFunderNews. He continued, “If FMC, DowDuPont, BASF and the rest of the market don´t react with other investments and acquisitions, they will soon be far behind Syngenta and Monsanto.”