Regrow.Ag: Doubling Down on Markets and Founders
In venture investing there’s often a debate about the weight that should be placed on markets vs. founders: is it better to back a great founder in a challenging market, or a mediocre founder in a terrific market? With Regrow.Ag I’m learning about the magic that happens when both are great.
Markets
In the shadow of the IPCC Report released earlier this month, more than ever we need meaningful, scalable solutions to halt our planet’s otherwise inevitable path to 1.5 degrees. Thankfully, more and more companies across our Feeding 10B People, Decarbonise the Planet and even our Supercharge Industrial Productivity Challenges are developing solutions that slow or reverse the impact of climate change. And we think the timing is great, because for the first time, mainstream corporate interests are lining up with consumers and most developed nations to take “sustainability” out of the fringes and into the core operations — and importantly, the budgets — of large enterprises. While idealists would like to think corporate leaders have “seen the light” on sustainability, climate change and ESG generally, the reality is we have our large institutional investors like Black Rock to thank for putting the topic on the Board agenda of every significant listed company, and increasingly tying executive pay to achievement of these goals. However we are getting there, the important thing is that commercial pathways for these clean green and sustainable solutions is stronger than it’s ever been.
It’s not to say there aren’t issues, and Regrow Ag is tackling a huge one. We know that agriculture represents 20–25% of emissions and for reasons above, increasingly retail, CPG and food companies are looking for — and willing to pay for — sustainably sourced products that decrease the industry’s contribution to GHG. Through our work with research institutions, corporate co-investors and portfolio companies, we are seeing many experiments and programs globally as players try to identify cost-effective ways to scale the impact. One of the biggest challenges: how to deliver a low-cost, accurate way to measure, report and verify the results from these programs that allows producers to benefit from sustainable practices and buyers to legitimately demonstrate the results.
Enter Regrow Ag. Regrow’s history as leading crop analytics company FluroSat gave the Company great insight into farming workflows, a huge amount of farm data, as well as the value of infusing science into its platform to improve impact and adoption. When FluroSat acquired Dagan to become Regrow, it brought together world-leading sustainable ag and soil carbon measurement science (led by the “Soil Whisperer” Bill Salas) with a scalable, proven farming analytics platform. In a few short months the world-leading team has been humming, and has released a unique and powerful MRV (Measurement Reporting and Verification) suite that helps producers, food brands and ecosystem market makers scale their sustainable ag programs. You will see some massive announcements in the coming months as this platform is rolled out to the industry, and the Series A round with a very aligned and strategic set of co-investors such as Cargill, Microsoft M12, Grantham’s NCO Fund and Ajax Strategies is a testament to what’s coming.
Founders
I first met Anastasia Volkova, Founder and CEO of Regrow.Ag in an accelerator mentoring session in May 2017, even before we had launched Main Sequence’s first fund. In typical Anastasia fashion, she had researched the mentors coming along that day and because of my prior work experience, sought me out to ask for input on her business idea, developed as part of an entrepreneurship program while doing her PhD in Aeronautical Engineering at Sydney University. By the time we came to lead the pre-seed round into FluroSat in late 2017, I knew we were backing someone special.
Anastasia embodies a number of traits that now set the bar for me in evaluating Founders:
- Deep understanding and passion about her problem space
- Desire to learn and grow over ego
- Huge ambition to win and courage to make big bets
In deep tech, you need to walk the fine line between being a credible expert in a domain or technology area, and being a “Learner” that will suck information and insights from every nook and cranny you can to predict where a market is going and what it takes to win. It’s tricky because the balance requires humility, self-awareness and the cliched “growth mindset” that desires knowledge over being right.
I got a view into Anastasia’s ambition in the early days and it has only increased in the four years since we met. Anyone who knows her understands this, but I think the best overt examples of the trait are the two acquistions we completed in our young company’s life:
- As a small, pre-seed stage company, acquiring ProductionWise from Grain Growers to increase their customer and data footprint, accelerate their product roadmap and scale the team significantly; and
- Dramatically “betting the company” on the acquisition of Dagan, joining forces with Bill Salas and planting a huge stake in the ground with her conviction in the consolidation of farming and sustainability, and the potential value to be delivered to the market.
With the above context, it should be no surprise that we doubled down (actually tripled down) by co-leading Regrow’s US$17m Series A. We are excited to be a partner with Anastasia, the amazing team at Regrow and our co-investors as we go on the journey to sustainable agriculture.
