Birtle farm boy goes global

Hey there, time traveller!
This article was published 20/12/2014 (4039 days ago), so information in it may no longer be current.

Not so long ago, Wade Barnes was just another farm boy from Birtle with a growing agronomy business and some good ideas about how Prairie farmers could use technology to get more reliable productivity out of their acres.

Now he’s jetting off to London to hobnob with the likes of Al Gore and the guy in charge of Google Earth.

It might not be too long before that does not seem unusual even to Barnes, because he’s not the only one who believes his agricultural technology company, Farmers Edge, is on a trajectory to become a billion-dollar company.

His recent appearance at a by-invitation-only conference in London might have had something to do with his new best friends at Kleiner Perkins Caufield & Byers (KPCB), the blue-chip Silicon Valley venture capital firm that’s backed the likes of Google, Amazon, Twitter, Spotify and Uber.

Last month, KPCB quietly closed an equity investment in Farmers Edge, giving Barnes and co-founder Curtis MacKinnon the kind of lofty vantage point on the global marketplace not typically available to independent players in the ag consulting/marketing world.

“We’re very odd to them,” said Barnes, 39. “Companies that go to them have a certain pedigree. They have an idea, raise a Series A round of capital… there is a formula. We had no formula. We did not fit the mould that they would normally invest in.”

Despite the apparent culture clash, by virtue of its track record, technology, vision, legwork and market timing, it turns out Farmers Edge really does have what the successful Silicon Valley venture capitalist is looking for.

“There are lots of disruptive forces in traditional industries today,” said Brook Porter, a partner in KPCB’s Green Growth Fund, the vehicle that did the Farmers Edge deal. “We see agriculture as being primed for disruption.”

And they see Farmers Edge as being a likely conduit for some of that disruption. In an interview from his office in Menlo Park, Calif., Porter said the Winnipeg company has all the components KPCB looks for: a disruptive technology in a very large market — “food and agriculture is a multitrillion-dollar market where there’s plenty of acres to build a big company,” — a strong founder and management team and… “it has to have the potential to be a billion-dollar-plus company.”

It’s not as if the company is coming out of nowhere. Farmers Edge has been ranked by Profit magazine in the top 20 fastest-growing companies in the country in recent years.

For all of Barnes’ talk about his lack of sophistication, Farmers Edge had already received a multimillion investment from Calgary-based Avrio Capital. Aki Georgacacos, one of the founders of Avrio, is on the Farmers Edge board and was very encouraging of the KPCB deal.

No financial details have been disclosed, something a little unusual for KPCB, which has done about 800 deals over the last 40 years. (One-third of them have gone public with a market cap totalling about $800 billion.)

“There’s some strategy around that,” said Barnes, about the non-disclosure, including the possibility of another round of financing in the works. “It was decided to keep the industry guessing a bit. Everyone is watching KPCB wondering what is going on. It’s driving everyone crazy. No one knows what the valuation is.”

Farmers Edge provides an la carte menu of services using satellite imagery, on-farm weather stations and other scientific tools to identify and map field variability. The collection of data — including from farm equipment hardware such as combines, seeders, air sprayers etc. — to optimize crop inputs, resulting in higher yields, better quality and less environmental impact.

The concept is referred to as variable-rate technology. The operational reality is precision farming.

“We provide the best field-centric data anywhere in the world,” said Barnes.

Mark Lepp, one of the owners of local farmer marketing firm, FarmLink Marketing Solutions, has known Barnes for a long time.

“They are for real,” Lepp said. “They are one of the pioneers of variable-rate fertility game.”

It’s an approach that can be applicable around the world, and Farmers Edge is not the only players in that game.

In the last couple of years, Monsanto has spent more than $1 billion on planting technology companies.

“Monsanto is trying to catch up to us,” Barnes said, only half-joking.

Despite Barnes’ contention that the ag sector is a bit of a strange duck for KPCB to deal with, Porter said they did a very extensive investigation into the sector and see the disruptive potential of new ag technology.

“I think the chemical and feed companies that are multibillion-dollar companies feel that change and they need to adapt,” said Porter.

Farmers Edge may also have the advantage in that this is all it does.

“The farmer does not necessarily want to turn all their data over to a Monsanto,” said Porter. “They feel very skeptical about what that data will be used for.”

Porter and KPCB found plenty of excellent technology out there, but Farmers Edge was the only one that had already convinced farmers to use the service. There are about four million acres of farm land in Canada, the U.S., South America and eastern Europe already paying Farmers Edge per-acre fees.

“People know how to take images and look at farm land and assess fertility,” Porter said. “That’s not that hard a problem. What is really hard is to put it into a system that is real easy for people to use, farmers trust it and can validate it works with their mode of operations.”

Armed with its new KPCB war chest, Barnes will soon be off to Australia and Brazil to convince farmers around the world of his vision of Farmers Edge as a billion-dollar company.

martin.cash@freepress.mb.ca