Yearning for yield

Yearning for yield

It’s not just social media sites and nifty gadgets that tech investors love. They also want a piece of Farmers Edge’s crop-boosting technology.

Vitals
FARMER’S EDGE

Winnipeg


Founded in:

2005


130

employees and growing

Wade’s Tips
  • Show your customers your value. We’ve learned that there’s a 20-minute rule – we’ve got 20 minutes to make our technology work in the farmer’s field, or they’ll go back to what they normally do.
  • Protect your customer’s data. We consider ourselves the gatekeepers of their information and we’re very respectful of that relationship.
  • Even if you’re getting a lot of calls and having lot of meetings, you’re still far from closing an investment deal. Even if you go all the way to the end with an investor, it can be very difficult to finalize an agreement.

No industry is immune to technological innovation, not even the centuries-old agriculture business. In 2005, Wade Barnes and his partner, Curtis MacKinnon, founded Farmers Edge, now one of Canada’s leading precision agronomy companies. It uses satellite imagery and big data tools to help farmers manage their crops more efficiently. This past November, Farmers Edge landed a deal from the same venture capital firm that has backed Amazon.com, Electronic Arts and Google. Barnes reveals how his company is shaking up the “ag” world, and why he has so many suitors.

“Before I started Farmers Edge, I was a farm boy working as an agronomist – a soil and crop scientist – in the crop inputs business. I was working a lot of long hours. My partner and I, Curtis MacKinnon, decided to start a business in the emerging field of precision agronomy. We imagined working with a few local growers and having time to go hunting, play hockey and do all the things that good red-blooded Canadian boys want to do.

Instead, we saw pretty massive growth in the first two or three years, all through word of mouth. One farmer would say to another, ‘I’m doing something really interesting here, and I think it’s helping me grow more
grain. You should talk to these guys.’

When we work with a grower, we gather information from satellite imagery, weather stations that we install and from a device that we put in their farm equipment that monitors everything they do. Once we’ve gathered the information, we can tell our grower when the best time is to put an application of fungicide or herbicide on the field. We can help with harvest timing and grain storage. The best part is, the farmer doesn’t have to be a tech genius to make this work.

By 2010, people were seeing agriculture and technology as a really interesting thing. I was getting phone calls all the time from potential investors. We ended up securing an investment from a British Columbia-based group that was already focused on ag technology called Avrio.

Then in 2012, Monsanto acquired a company called Precision Planting. Suddenly, major players in the agriculture business, who previously had no interest in what we were doing, were showing interest. I thought: If Monsanto is willing to buy a company very similar to Farmers Edge for US$210-million, we needed to raise more capital and get ready to grow, or we’d be overtaken.

We hired an investment banker and went through almost a year-and-a-half-long process of securing an investor. We wanted someone who could be viewed as independent, but knew the importance of big data and technology. We landed one of the most prestigious venture capital groups out of Silicon Valley, Kleiner Perkins Caufield & Byers. They were looking for a company that had scale, a solid technology portfolio and a business that was willing to embrace the power of big data. They’ve helped us craft our vision, they’ve talked to us about what we need to do with big data and how we need to change the company to adapt to the future.

We won’t say how much the investment was for. We want big players like Monsanto and Bayer CropScience to be guessing how much dry powder Farmers Edge has. But it was a significant amount. We’re going to grow really quickly. We have a lot of capital to deploy on research and development, and growing the business – and that’s what we’re going to do.

In the beginning, we worked with roughly 20 growers with about 25,000 acres in total. Today, we touch and feel close to four million acres. Next, we’re going for global domination. We have a big push in the U.S., we’re doing a joint venture in Brazil, and we have a joint venture in Australia. We’ve always had a very significant presence in Eastern Europe, but now we want significant growth on a per-acre basis globally and also want to keep bringing out new tools that farmers can use to better manage their crops.

The funny thing is, I’m the CEO of an agriculture technology company, and I am as far from a tech guy as you could get. Everyone laughs at me because they say, “Wade, you can hardly run your email.”

On the other hand, MacKinnon is a bit of a MacGyver. He was very gifted when it came to GPS monitoring and on-board computers and software. In the beginning, I did a lot of the agronomic work and the sales, and he did the technology side of it. That foundation is still with us today.

But we still haven’t found time to do the fun stuff we wanted to do.

- Claire Gagné / Photograph by Thomas Fricke