Suite of acquisitions could signal the end of Agtech startup boom
The recent spate of acquisitions involving big corporations snapping up agtech start-ups leaves the future in doubt for smaller players and newcomers to the space, according to Ben Johnson, precision farming coordinator at Ag View FS. In a company blog post, Johnson cited John Deere's purchase of Blue River Technology, DuPont's acquisition of Granular, and Premier Crop Systems being snapped up by Syngenta as examples of large corporations with deep pockets snuffing out potentially disruptive competition.

Share







In the past few months there has been a flurry of acquisitions of agtech startups by major players in the industry. Let’s look at a short and hardly complete list of a few of these recent acquisitions:

With startups like these all being recently purchased and absorbed into the larger framework of the digital ag platforms of some major players, one has to wonder if the agtech startup boom is ending.

Advertisement

It almost feels like this is becoming a game of musical chairs, and what companies are going to find themselves without a seat in one of these large digital ag platforms when the music stops?

Of the startups that do remain, one has to wonder about their survival without either new investment dollars coming in past their B and C investment rounds or a sound enough business plan to get them in the black on their own. I speculate that some of these startups that are lacking in those two areas will either go belly up soon or get purchased for a song by a major player.

As for the rest of the agtech space, there are some very large digital ag platforms being assembled by major players in the industry. Monsanto with Climate FieldView and Dow/DuPont with their combination of Encirca, Granular, and AcreValue are both very robust digital ag platforms with a lot of capabilities that are only going to increase over time.

Little guys with a product with a narrow focus have got to be concerned. Sure, a lot of growers like to deal with companies independent of their seed and chemical manufacturers, but logging on to 15 different websites and transferring all of your data to all of them is a real pain and overwhelming to update the information on a regular basis. We’re at a point where we expect all of this stuff to just flow together with minimal effort. Growers expect that maybe there is some work upfront, but it should be easy on an ongoing basis since that was half the point in doing this anyway. This is where the large digital ag platforms have a huge advantage.

Farmers Edge seems to be filling the independent segment of the market as they also appear to be developing into a digital ag platform, but what are the realistic chances of a new startup coming in and entering this space? When you think of the deep pockets they are up against, do new startups really stand a chance at this stage of the game?

0 1 5 Is the Agtech Startup Boom Over?