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HeavyConnect CEO shares why the best AgTech companies are the ones spending time in the field

Image of Patrick Zelaya, CEO & Founder
Patrick Zelaya, CEO & Founder
Training in the field

Agriculture tends to carry a reputation for being slow to adopt new technology, but that couldn’t be further from the truth. This industry has a rich history of innovation. Food producers are constantly developing new methods to efficiently grow high-quality, safe crops. What sometimes looks like a reluctance to adopt technology is justified by the high risk of new solutions and the validation that goes into every decision.

In my 12 years at John Deere and the time since founding HeavyConnect in 2015, I’ve been able to observe the technology adoption cycle and new trends in AgTech. Overall I’ve seen incredible growth. Contrary to stereotypes, farmers are willing to change their methods and the industry at large is open minded about new technology. 

As someone at the intersection of agriculture and technology, I’ve noticed that there are certain things that tech companies can do that ensure their solution is useful. There are also some easy-to-spot indicators that growers should look for before they start using a new solution.

In-house research and development departments used to be the main innovation drivers

Until recently, the majority of advanced and well-funded technology development originated from R&D divisions within industry incumbents like John Deere, Dow Dupont, and research universities like Cornell and Purdue. Those technologies were extensively tested within a defined sample of existing customer farms and had minimal exposure to broader user acceptance until after they were made available to the public market following their commercial launch. Despite having been developed in a silo, many of the products, like satellite-guided steering systems, have enjoyed global adoption since their introduction back in the late 1990’s.

Around 2010, data-centric technologies like in-field sensors & farm management systems began to emerge from unlikely origins like Silicon Valley. Their user acceptance testing was more broadly distributed among the farming community and as a result, their post-launch adoption was faster than traditional agriculture technologies that focused their development on a single brand of equipment or seed purchased.

As the new AgTech startups continued along a unique path to market adoption, they found themselves detached from the major industry stakeholders and a new market landscape was formed that positioned independent technologists as competitors with traditional Ag brands. Occasionally, this worked out well for the startup. The most notable example to date being The Climate Corp who built their value proposition around the availability of climate data and were subsequently acquired by Monsanto with headlines as the first AgTech billion dollar acquisition. More often though, AgTech startups have struggled to build brand awareness within a market beset by industry giants with endless marketing resources.

Today, AgTech venture capital plays a crucial role

AgTech startups require funding to withstand long validation cycles, seasonal market adoption, and constant iteration. The financing challenges create an opportunity for venture capital involvement which is now a major player in today’s startup ecosystem.

Venture capital funding can provide stability for a burgeoning startup and signal validation that a business is headed in the right direction. For us, participating in 500 Startups and Techstars Farm to Fork doubled our growth speed and helped us build a strong network of mentors and peers.

However, it’s important to keep in mind that venture backing doesn’t always mean there is solid product-market fit. When an AgTech company is too insulated from the agriculture industry, VC funding can prolong inevitable failure.

Customer validation will always be the most important factor

The best technologies are developed in harmony with their market. For us, it is the community of growers, packers, and shippers in the first mile of the food supply chain. From the beginning, we put our software in the hands of growers like California Giant in Watsonville, California to see how it fit within their workflows and met the needs of their business. Then we continuously iterated our platform based on their observations and requests. The process of working with our customers side-by-side in the fields & facilities led us to where we are today. 

For a new technology to be useful, it needs to fit an urgent need. Founders need a close connection to a problem to know if they are solving it or not. This is why employees with backgrounds in agriculture are often a defining factor in an AgTech business’s ability to achieve product-market fit. 

Growers face high stakes when choosing new technologies

Farmers have incredibly high stakes when choosing new products. Often a grower has a single crop cycle to test a new technology and the wrong choice can be extremely expensive or even catastrophic to their business. Farmers understandably need to see anecdotal success and hear from others in the industry that the new technology works.

When a business offers to replace multiple functions with one solution, the risk is even higher. Payroll systems like our TimeKeeper product require a lot of validation and plenty of phase-in time. Often customers will be cautious and use paper alongside the mobile app until they can say with confidence that it’s better than their old solution.

At the end of the day, growers need products they can trust. The AgTech companies that inspire confidence are the ones who spend significant time out in the field validating their product and iterating based on feedback.

Growers should look for technologies that were built with customer input 

As AgTech companies expand and more startups enter the market, we will accelerate the exciting advances that make food production more efficient and profitable. Venture capital financing will continue to play an essential role in the AgTech ecosystem as new independent technologies like HeavyConnect become the new standard and ubiquitous across the industry. We are confident solution providers will carry on the tradition of rigorous self-validation within their product development leading to stronger solutions that make growers’ lives easier. These are the technologies growers should invest in and the ones that will define the future of AgTech.

Leafy Green

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