Gro Intelligence, a company providing insights into agriculture using Artificial Intelligence (AI), laid off a significant portion (60%) of its workforce. Despite this, they reportedly secured some last-minute funding.
According to reports by AgFunderNews, employees at the company’s offices in New York and Nairobi were informed last week that Gro wouldn’t be able to meet payroll.
However, they were offered some consolation: back pay, unused paid time off (PTO), and health insurance coverage through March. Notably, there was no severance package included.
“Gro received some funding, but with strict conditions attached.”
Founded in 2012 by Sara Menker, Gro Intelligence aims to be the world’s leading agricultural data platform. Most of the firm’s revenue comes from Unilever, with some business from other packaged food companies and investors, the report further noted.
However, Gro reportedly struggled to secure deals with a small Asian country aiming for food security and an oil-exporting Middle Eastern nation. Additionally, attempts to engage the US government yielded minimal success.
“While the company did lose a client in the crop input industry, that wasn’t the primary cause of their problems. According to a source, renewal rates for their services among commodity investors were actually good.”
The report blames a combination of factors for Gro’s difficulties: a tough funding environment, a product that didn’t quite fit the market’s needs, and internal issues.
“They pursued projects resembling consulting work instead of focusing on building recurring revenue streams. Additionally, the company lacked a Chief Financial Officer (CFO) for a significant period, potentially hindering their ability to present financials to investors. The source believes Gro should have brought in an experienced CEO much sooner.”
Despite the layoffs, Gro is recognized for having a valuable product and a talented team.
However, some industry experts believe they need to improve their sales strategy and find a clear niche market.
Initially focused on agricultural data aggregation, Gro now includes climate data. However, some question who their ideal customer is and what specific problem they solve. While they target a wide range of clients, this broad approach might be hindering their success. Bringing in an experienced operator could be crucial for Gro’s future.
The climate tech sector, particularly climate adaptation solutions, is evolving. While funding challenges exist, companies that focus on solving specific business problems within this area are more likely to thrive.
Gro Intelligence, self-proclaimed as the world’s largest climate data platform, gathers data from various sources like governments, trade organizations, and weather agencies. This data is used to generate actionable insights, such as crop yield predictions.
Gro highlights the accuracy of their yield forecasts, claiming to be within 98% of the USDA’s final report for US corn yield over the past eight years (three months in advance).
They also emphasize the importance of yield predictions for various stakeholders, including governments, agribusinesses, and financial traders.