Melbourne-based agtech startup Agersens has raised $14.75 million in funding to commercialise and grow its virtual fencing solution helping farmers keep their cows in check.
The funding round is led by existing investor Gallagher Group Limited, a global electric fencing and livestock weighing technology company. Other existing backers have also contributed to the round.
Founded in 2014 by Jason Chaffey and Ian Reilley, Agersens is developing its eShepherd virtual fencing solution for beef and dairy cattle.
The startup has also announced a change in leadership, with Reilley stepping back from his role as chief executive and Chaffey taking over.
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The technology is designed to automate the movement of livestock and “bridge the divide between pasture management and animal management”, Chaffey tells StartupSmart.
The eShepherd product uses solar-powered GPS trackers for cattle. Farmers create a virtual boundary, and the animals are notified by the collar when they get close.
If they ignore the cue and continue walking past the fence, they will receive a small shock. Eventually, the cows learn the sound means they have reached the boundary.
The system is intended to help farmers manage their pastures, and to allow for easier rotation of cattle areas.
This allows the animals to consume more grass and put more weight on, Chaffey explains, and “ultimately improves the productivity, which is really dollars per kilo”.
Traditional fencing requires a certain amount of infrastructure, he adds.
“Having a virtual fence means you can have an infinite number of fences.”
According to Chaffey, the co-founders work closely with farmers to understand how they can best benefit from this kind of technology, and how they’re likely to use it.
“What we’re doing is working with them and showing them how virtual fencing can improve productivity and changing the way in which they think about pasture management,” he says.
A global industry
Agersens is currently running pre-commercialisation trials, and is working towards a full commercial launch next year.
This latest funding is “a sign of confidence in the problem we’re solving, but also in our approach”, Chaffey says.
Gallagher is “an important partner in this”, he adds. The business has a history of investing in agtech innovation, and has the global reach to get the technology to market in Australia and beyond.
“They’ve recognised that this is the next progression in fencing and animal management,” Chaffey says.
“That allows us to access not only Australia but other parts of the world through the distribution they can bring to the table.”
Initially, the funding will be used for honing the technology and getting the product ready for commercial release.
But the team will also work with Gallagher as they start thinking about scaling. Chaffey sees eShepherd as being a global product.
“Farming is a global industry … we do see that [eShepherd] will have application in all parts of the world,” he says.
A new chapter
Chaffey has taken over as chief executive to see Agersens through this next phase of growth.
He has a background in science and engineering, but also has experience working with and growing startups, “taking technology that’s on the bench all the way through to commercialisation and sales”, he says.
The new chief’s experience is in figuring out who the customers are and what they want, bringing a product to market, “and making it work in the market that you’ve identified”, he adds.
“I have a lot of experience in this startup space, bridging the divide between that product-market fit.”
While Reilley was the right person to take the business from the ground to getting a proof-of-concept into the market, Chaffey’s skill set is more suited to the next phase of growth, he says.
“Now we’re going through that next phase of commercialisation and taking the product to market, there’s a different approach that’s required.”
And handing over the reins has always been on the cards. When it came down to it, there was no need for a difficult conversation, Chaffey says.
“It’s always been part of the conversation,” he explains.
Reilley is still a founder ambassador, and will be a non-executive director.
“Being the person who has got it to where it is today, he still has great vision and a lot of energy for the company,” Chaffey adds.
Focus is key
Agriculture in Australia is “a very relationship-based industry”, Chaffey says.
Managing the distance between the business and its clients can be “a bit of a struggle” he adds.
“We do invest time in going it and talking to farmers and business owners.”
However, he advises other startups in this space to stay focused on the particular product or serve they’re providing.
“That is the key part,” he says.
“Initially, you can try and be all things to all people but you end up not providing any value to anyone,” he advises.
“It’s about focusing the company on solving the right problems, reducing the risk as much as you can as soon as you can, and then testing that with the market as much as possible.”