In a landmark venture capital funding, Fredericton agriculture technology company Resson has raised US$11 million (C$14 million) from Monsanto Growth Ventures and other investors to expand its team and open a Silicon Valley office.
Resson said in a statement today that the investment was led by the VC arm of Monsanto, the St. Louis-based agrichemical and agritech giant that is best known for its genetically modified foods. Monsanto is a new investor in the company, as is McCain Foods Ltd., which has been a customer of Resson for the past two years.
The other investors in the Series B round are returning investors that participated in the $3 million Series A round in 2014. They include Build Ventures, Rho Canada Ventures, New Brunswick Innovation Foundation, BDC Capital and East Valley Ventures.
Resson also said that Jeff Grammer, a partner at Rho Canada Ventures, will become the executive chairman of the company. Peter Goggin, who had been the CEO, will move to VP of Operations.
Resson’s funding marks one of the largest venture capital investments ever in Atlantic Canada, and lends credence to claims that American institutions are beginning to take an interest in some of the region’s startups. The investment by the McCain group is also significant because it marks a strong investment by a local blue chip company that served as the startup’s early adopter.
“This is an example of what can happen when things come together properly,” East Valley Ventures Chair Gerry Pond, one of the investors, said in an interview. “You’ve got smart young people not long out of university and they hooked up with a great early adopter. And the space they’re working in is hot.”
Goggin and his co-founder Rishin Behl established the company three years ago to create software that would assess data from a range of sources on a farm. They developed a system called RAMAS, which collects data from such sources as tractors, sensors buried in the field, and aerial drones flying over the field. It brings all the information together and presents the farmer with a report on what is happening in his field and what actions need to be taken.
Their breakthrough came when they signed up McCain as their first customer and were able to improve the yield of the company’s potato crop. The company booked revenues of almost US$1 million in 2015 and Goggin hopes it will triple that number this year.
“We have worked with Resson from the earliest days of the company and have seen the tremendous potential to improve our operations by using their predictive analytics technology,” said Dirk Van de Put, President and CEO of McCain Foods. “We continue to work with Resson towards the implementation of their breakthrough technology and are excited by the prospects it brings to the community of potato professionals.”
There are many companies using data to improve agriculture by assessing a crop’s variation from what’s known as the Normalized Difference Vegetation Index. But Resson has moved beyond that to diagnose problems that can be corrected immediately.
“We envision this impressive data-driven technology helping to improve yields, while reducing costs across a number of crops and cropping systems,” said Ryan Rakestraw, Venture Principal at Monsanto Growth Ventures. “We’re looking forward to working closely with Resson as its team continues to develop a predictive solution that could benefit the entire global agriculture industry.”
Goggin said in an interview the company plans to double its staff to about 45 people by early next year. Resson will continue to be headquartered in Fredericton, and will open an office in San Jose, Calif.
“Monsanto is one of the world’s top agriculture companies and its support will help us continue to develop a product that helps large and small farms improve crop production,” said Grammer in a statement.