“Growth, growth, fast growth,” Strey says of what investors are looking for. “Burn money for growth.” Before bringing in venture capital, the Plantix team imagined success as simply creating a profitable business. But even small goals “aren’t always that attractive to investors,” Strey says. Investors prefer fast growth towards a single, huge dividend.
The team quickly realized that if Plantix was going to survive as a great idea without a clear business model, it would have to give venture capitalists what they wanted. That means more downloads, more users, which means you have to be able to monetize it somehow.
At the time, Plantix was considering operating in Mali, a country with a population of 23 million. After learning at an innovation conference that India was home to about 150 million smallholder farmers, Strey decided to shift the company’s focus to the subcontinent. The team quickly forged partnerships with local research groups, set up a field office in Hyderabad, and began teaching algorithms to recognize local pests and crops in Indian languages. By the end of January 2018, Plantix had grown to approximately 300,000 monthly users and had raised $4.9 million in one round of VC funding.
With food and agriculture being an $800 billion industry, moving to India has become an obvious choice for ambitious agritech startups. In recent years, the government has aggressively expanded its telecommunications infrastructure, increasing the number of smartphone users to about 450 million and doubling coverage in rural areas. This meant that a farmer walking through a sick field in Jharkhand could scroll through Plantix in search of a cure.
To use the app, farmers provide crop selection, acreage and application input, then upload photos with embedded GPS coordinates. Some growers use this app on a weekly or daily basis to provide deep, detailed, real-time images of agriculture across India. Using it has made Plantix’s AI more accurate and helped it gather valuable information for crop buyers, seed sellers, tool manufacturers, lenders, insurance providers and pesticide sellers.
During the presentation, Strey said he saw how investors cheered at the mere mention of data. “[The idea] “We never proved we could make money with it, but it sold well to investors.”
The problem, as many companies have discovered, is that every data buyer wants certain information to appear in a certain way. Plantix must be reorganized around the production and packaging of marketable data products, and the economics are by no means clear.
