Silicon Valley startups go farming

July 22, 2015, 1:00 PM UTC
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RAYMOND, NE - OCTOBER 11: Cattle farmer Ben Gotschall organizes his cattle while moving them to a new field for grazing on October 11, 2014 in Raymond, Nebraska. Gotschall, a native Nebraskan, is staunchly against the proposed Keystone XL pipeline, which he believes would negatively effect Nebraska's environment. (Photo by Andrew Burton/Getty Images)
Photograph by Andrew Burton — Getty Images

Silicon Valley, often accused of following the herd, is doing that quite literally when it comes to startups building technology for farmers. Some of the most well known venture capitalists and entrepreneurs are now focused on bringing the latest computing technologies — data analytics, cloud computing, mobile apps — to farms.

On Wednesday, farming software startup Granular said that it has raised a new round of $18.7 million in funding from investors Andreessen Horowitz, Google Ventures, and Khosla Ventures. New investors in the round, which is Granular’s second, included Tao Capital Partners, Emory Investment Management, Fall Line Capital, and H. Barton Asset Management.

Granular debuted last year from the split of another startup called Solum that was founded in 2009. Agriculture giant Monsanto acquired the half of Solum’s business that sold soil testing and data tech to farmers and folded it into the data team it acquired in 2013 from data startup Climate Corp.

Solum’s remaining technology, which is software, cloud-services, mobile apps and collaboration tools for farmers, was spun out into Granular. Now Granular’s software is helping a handful of farmers manage their farms more efficiently, using less water and less fertilizer. The tech enables them to tap into detailed data about how their farms operate in real time and, presumably, make better decisions. (Granular says it has several dozen customers covering about 1 million acres).

A farmer on a combine harvester crops wheat on a field in Hohenossig near Leipzig, eastern Germany, on August 8, 2014. As meteorologists forecast precipitation, farmers work on their fields day and night to bring their harvest in.Photograph by Sebastian Willnow — AFP/Getty Images
Photograph by Sebastian Willnow — AFP/Getty Images

For example, Ohio farmer Mark Bryant has been using Granular’s software to manage his farm’s operations, budget, and inventory tracking. Granular introduced its software last year with seven Midwestern farmers who also helped the company design the original software.

Granular is just one of dozens of startups trying to sell tech to farmers. The company is focused on the thousands of big farm owners that account for a third of U.S. farmland. These large farmers are increasingly buying up land from smaller farming operations and are looking for new tools to manage it all.

Not only has the agriculture industry been slow to adopt tech, but farmers are increasingly looking to use tech to reduce their use of water and fertilizer to save money. Water shortages from droughts are expected to become more common. As the world population hits 9 billion in 2050, farmers will have to produce more food, with less resources.

California's Central Valley Heavily Impacted By Severe Drought
California is among a few states drastically overusing its natural resources.Photograph by Justin Sullivan — Getty Images
Photograph by Justin Sullivan — Getty Images

Extreme weather aggravated by climate change is also making farming more risky. Farmers are looking to use more tech to better deal with the potential weather problems.

Between 2013 and 2014, Silicon Valley’s interest in backing agriculture and food-related startups doubled in terms of deal size, according to data from the Cleantech Group. In 2014, 151 startups focused on agriculture and food (not including biofuels, but including some of the on-demand food startups) were funded to the tune of $976 million.

That funding FAST-PACE looks like it will continue this year. In May farming data startup Farmers Business Network raised $15 million from Google Ventures, Kleiner Perkins and DBL Investors. Other farming tech startups include FarmLink, Adapt-N, Farmers Edge, FarmLogs, aWhere, Granular, Farmeron, OnFarm, Agralogics, Blue River Technology and Precision Hawk.


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