“Ahead of the curve”: FluroSat bags $4.6 million, including from Microsoft, as market wakes up to agtech opportunity
Wednesday, July 24, 2019/
Aussie agtech FluroSat has secured $4.6 million in funding from big-name backers, including Microsoft’s venture fund M12, as it looks to take its tech to a global audience.
The funding also comes from Artesian and GRDC’s GrainInnovate Fund, the Artesian Clean Energy Fund, Costanoa Ventures and Space Capital.
Existing investors Airtree Ventures, muru-D and CSIRO’s Main Sequence Ventures have also participated in the round.
Founded in New South Wales, FluroSat is a data analytics company combining imagery and farming records to produce recommendations on how to optimise crops.
Back in February, the startup secured $3 million in grant funding. Since then, founder Anastasia Volkova has joined the Austrade Landing Pad program in San Francisco, and is working on developing the market and securing new customers in the US.
“I wanted to prove the company is scalable, and the value proposition is universal,” Volkova tells StartupSmart.
“We don’t want to build something that’s for the Australian market alone, because it’s a relatively small market in agriculture.”
Already, FluroSat is broadening its reach in the US market, targeting the supply chain, food processors, and brands that supply consumers.
“There’s more emphasis on decision support for agronomists all across the supply chain,” she says.
She also sees growth opportunity for the startup beyond the US.
“We need to grow faster, and now, otherwise we will be behind this curve,” Volkova adds.
“There are customers who want to take this. We need to build it faster.”
The funding will be put towards this expansion, and to productise some of the more recent innovations the startup has proof of concepts for.
This will involve finding and hiring go-to-market teams, with a focus on the US, Canada, Argentina and Brazil.
“We have walked into a few markets where we have felt traction,” Volkova says.
More than money
This funding comes from high-profile investors, and Volkova says they all bring something non-monetary to the table.
“We don’t take the money for the money’s sake,” she says.
“If someone can bring value to the company, give us strategic advice, and the help that we are needing, the expertise we are lacking.”
GrainInnovate, for example, is focused on making an impact on the global grain community, she says.
Although they focus on Australia, they’re “quite globally connected”.
Also, Space Capital looks at the global impact of space data.
“Immediately, we had partnerships with portfolio companies that enabled us to source more data,” Volkova explains.
“And we’re already talking to customers using that data.”
Although it might not seem like Microsoft’s remit, backing from M12 allows the startup to start conversations with clients in the developing world.
Microsoft has been working on solutions for data collection and data processing in the developing world, Volkova explains.
This is something that can help FluroSat “actually deliver on the promise of our business”, she says.
“If we are talking about high-impact crops, and how our decision support will enable stable production of them, that includes developing worlds.”
Finally, Volkova says she also values the independence that going with these particular investors affords.
“There aren’t many ways in which you can remain independent and grow,” she says.
Some VC firms are actually investing with funds from larger organisations that could potentially try to influence the company.
“We did not want that,” she says.
“The technology needs to come to the market un-stained, and that’s truly what we’ve been able to achieve.”
Trust your vision
When you’re working on complex technology, Volkova advises while you should listen to feedback from clients, it’s also important to persist with your own vision for the business. Sometimes, it pays off in the end.
“Being ahead of the curve, we have needed to keep persevering with our vision, until the market caught up,” she says.
“Now we’re starting to feel it, now we’re getting this backing, because people finally understand what we were talking about.”
Securing grant funding was instrumental to FluroSat, because it allowed the startup to build proof of concepts, to get some traction in the market, and to prove customers wanted the product.
“Of course, when investors see that, they trust customers’ dollar,” Volkova says.
You have to be aligned with your market, and listen closely to it, “but if your vision is bigger than what the customer can currently understand, you need to find those early adopters”, she says.
“And then if they back it and prove it, really stick to that — to what differentiates you.”
Building anything always takes longer than you think, Volkova advises. But, if your vision is worth it, then by the time you’re done, you will have a “truly differentiated” product.
“The quick wins that are so easy to turn into non-differentiated products, are they even worth building?”
“In some industries, probably not,” she adds.
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