Agtonomy – the US company making AI-enabled automation software for agriculture and land maintenance – has hailed its ‘common-sense’ fundraising strategy after closing its Series A round.
It raised an additional $10 million, bringing the total funding to $32.8 million. It is now primed for accelerated growth and market expansion over the next few years, it says.
The company creates software and hardware to enable autonomous operation of agricultural equipment like tractors.
The business model combines software expertise with established OEM partnerships in the hope of addressing labour shortages and sustainability challenges in the industry. In May, Jorge Heraud, formerly John Deere’s vice president of automation and autonomy, joined the Agtonomy board, adding further clout to its ambitions. Agtonomy’s immediate growth plans include scaling its West Coast technical team into new markets, expanding its 2025 paid pilot programme for permanent crops by 500%, and developing technology solutions for other industrial markets that seek world-class automation to improve margins.
The problem with traditional VC and ag
The news of Agtonomy’s success comes amid questions as to whether the traditional venture capital model is the best fit for agtech.
Agtonomy’s Series A round was led Autotech Ventures, a leading mobility venture fund. Agtonomy’s CEO Tim Bucher, a farmer and entrepreneur who has worked in technology for over 30 years, believes the typical VC investment horizon may not align well with the longer development cycles in agriculture.
“Having experience in both agriculture and Silicon Valley, I can confidently say that the venture capital model that's successful in tech doesn't translate well to agriculture,” he says. “Farmers are pragmatic and prioritise reliability over novelty. Instead of relying solely on venture capital, agtech companies should consider alternative funding models that align better with the agricultural industry's needs and timelines.”
“At Agtonomy, we recognise that farmers don’t have the time to waste on agtech start-ups to manufacture machines that take years to deliver and have yet to earn grower’s trust. That’s why we’ve taken a more common-sense approach by partnering directly with established OEMs and IEMs (integrated equipment manufacturers) as well as strategic investors.”
These collaborations, he says, are designed to leverage trusted brands and existing dealer networks, ensuring farmers receive reliable, autonomous solutions that seamlessly integrate into their operations and drive profitability.
Concurrently, strategic investors, or corporate VCs, bring to the table the “commitment and industry insights” to foster innovation on the farm. “Had we been trying to go it alone, Agtonomy simply wouldn’t be able to manufacture the machines farmers are demanding now for the real work, real solutions they need to survive,” he explains.
“The challenge we face is existential, but, individually, we can’t deliver at the pace and scale needed. Instead, we need to break the model and collaborate with speed, precision and purpose. Overall, funding sources must align with the industry's realities – recognising the investment is in the product-market-fit and the reliability of each innovation. Investors need to understand that success in agriculture requires a long-term outlook. It's not about quick exits; it's about developing technologies that truly serve farmers' needs and can stand the test of time in the field.”
Be prepared for longer investment horizons and more gradual returns
Bucher’s advice for start-ups seeking funds is to focus on developing “practical, reliable solutions that address real farmer needs”. Contrary to common belief, he notes, the barriers to technology adoption is not farmers’ hesitancy, but rather start-ups’ inability to provide reliable solutions.
“It's essential to build strong relationships with farmers and agricultural experts to validate your technology. Consider involving farmers in the development or investment process to build trust while getting real-time feedback. Be prepared for longer development cycles and slower adoption rates than you might see in other tech sectors.”
As for investors looking to deploy capital in agtech, Bucher says it's crucial to understand the unique challenges and timelines of the agricultural industry. “Invest in companies that have strong farmer relationships and proven year-over-year field results,” he advises. “Be prepared for longer investment horizons and more gradual returns. Consider partnering with agricultural experts or established companies to better evaluate opportunities. In agriculture, success often comes to those who take a long-term, patient approach.”
