An Australian agtech startup developing Internet of Things (IoT) solutions to drive safe and sustainable food production has secured a $6.5 million Series A funding round, led by Bosch, KPMG and AgFunder.
The latest round brings investment in The Yield to $11.5 million since it was founded in 2014. The startup also received a $1 million government grant in 2015 to help it make a dent in its target market.
“We wouldn’t exist if we hadn’t got an Accelerating Commercialisation grant,” The Yield founder Ros Harvey tells StartupSmart.
Harvey, who launched the venture with just “me and my kitchen”, now works in a team of 15, with offices in Sydney and Hobart.
She says the latest funding will be used to bring The Yield’s new microclimate sensing system to market, as well as funding sales and marketing efforts to drive expansion into the US and Europe and continued product development.
“[The microclimate sensing system] will measure weather at a very fine level,” she says.
This will enable users to see and manage things happening out in the field that can “drastically” affect what’s produced, says Harvey.
With “unprecedented constraints” on world resources and issues like climate change, Harvey believes farms need smart data and technology to protect harvests and produce safe and healthy food.
“We’re really focusing on how we’re going to feed the world without wrecking the planet,” she says.
The Yield is aiming to drive this with new data analytics and artificial intelligence-powered hardware and software solutions for agricultural businesses around the world.
“Our capital requirements are high because of that incorporation of hardware,” she says.
“We’re using data analytics to do very sophisticated predictive analytics and you really have to make sure you have high quality data to be able to do that.”
The deal with fundraising
Harvey, who’s led The Yield through multiple investment rounds, says bringing investors onboard is about strategy, trust and understanding.
“This is my fourth cap raise in two years,” says Harvey.
“Raising capital is always an intense process [because] effectively what you’re doing is demonstrating to investors you [have] fantastic technology, a business model that’s actually going to generate return on investment, and also the [team’s] ability to execute.”
Harvey says The Yield will now move forward in “collaboration” with its multinational corporate investors, which is a very deliberate approach.
“We really focused on strategic investors rather than venture capital funds … because we want investors who share our values but [who] also [have] the capacity to help us scale globally,” she says.