Farmobile raises $18m from investors
Oct. 31, 2017
All of the private investors along with Anterra also participated in Farmobile's last funding round in 2015 when it raised a $5.5 million Series A.
Farmobile produces a small in-cab unit for farm equipment called a PUC that wirelessly shares machine and agronomic data gathered in the field in real-time and allows the farmer to share it with advisors and employees such as agronomists or insurance agents. The company sells the PUC along with various sensors and a complimentary software service that produces Automatic Electronic Field Records (EFRs) for customers.
In 2016, the company began offering farmers legal agreements that govern the ownership and control of their agronomic data.
Developed in response to farmer feedback and concerns about the risks associated with sharing farm data, the agreements seek to simplify the relationship between a farmer and an Agricultural Technology Provider (ATP). This includes any company that uses a farmer's data to provide decision support, field mapping, prescriptions, or other similar services. The agreements also allow the farmer to participate in Farmobile's "Farm Data Marketplace."
Through this service, Farmobile collects offers from companies that want to use the farmer's data and brings it back to them. If the farmers want to accept the offer, the agreements ensure that the farmers will receive payment for use of their data. Farmobile and the farmer split the payment down the middle.
At launch, the marketplace was paying farmers $2 per acre up to 250,000 acres. Jason Tatge, founder of Farmobile, says that a year later prices vary greatly depending on the intricacy and amount of the data being purchased. So far, no farmer has refused to sell to a customer who contacted them through the marketplace.
In 2016, the data marketplace had 4200 field records available for purchase and by the end of this year, Tatge expects to triple that number. Though he has customers in 11 countries, Tatge admits the Farmobile is still largely a midwest companies with 70% of users within a five-hour drive of his Overland Park, KS office, with most of the growth coming from word of mouth.
"Once you do something that helps a farmer make money or save time, generally they are pretty big advocates," said Tatge.
Farmobile was one of the first three companies to receive the "Ag Data Transparent" seal through The American Farm Bureau Federation's Ag Data Transparency Evaluator - an initiative aimed at helping farmers determine which ag data service provider is right for their operation.
He told AgFunderNews that the company will use the new funds to expand distribution channels in ag retail, original equipment manufacturer (OEM) and equipment dealerships, and insurance providers. The company has a historical relationship with AGCO dealers, but Tatge says that it has dealer relationships representing roughly every major brand.
The investment from Amtrust Agriculture Insurance Services is a sign that Farmobile's technology could have an impact in modernizing the still very analog crop insurance system in the US as well.
President of AmTrust Agriculture Insurance Services Mark Raymie called Farmobile a "breath of fresh air" for his industry adding, "Better utilization of ag data is going to have huge implications across every facet of agriculture, including crop insurance."
Tatge added that getting away from the "pad and paper" way that the crop insurance industry operates could benefit farmers. "We've learned a lot about the crop insurance market and the antiquated way that they are doing a lot of reporting. They are helping us understand how we can use electronic field records to help automate reporting processes," he said.
The four-year-old startup has had some legal trouble in recent years.
In July 2016, Farmers Edge, a precision agriculture decision support platform, filed a lawsuit against Farmobile and the startup's founder and CEO Jason Tatge. Filed in the United States District Court for the District of Nebraska, the 56-page complaint includes causes of action for misappropriation of trade secrets under Nebraska law, breach of express and implied contract, breach of the duty of good faith and fair dealing, breach of fiduciary duty and the duty of loyalty, conversion, civil conspiracy, promissory estoppel, and various other claims.
In response to the lawsuit, Farmobile released a statement in which the company described the lawsuit as "designed to thwart [the founders'] business model." This case is ongoing.
In March 2017 Farmobile sued Farmers Edge to enforce its Canadian patent against Farmers Edge. According to the Statement of Claim filed in Court, Farmobile alleges that a device and system used, operated and sold by Farmers Edge infringes Farmobile's Canadian patent.
In September, the Federal Court of Canada ordered Farmers Edge, a Winnipeg, Manitoba-based company to provide the particulars of Farmers Edge's defenses and pay $5,000 of related legal fees to Farmobile.
Tatge referred to his former statements on these matters, but added, "We have had a few things go our way."
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