As farmers, we may be on the verge of a transformational change in the way farmers conduct business and manage their operations all because of the Silicon Valley start-up: “Farmers Business Network.”
History is littered with farmer and peasant uprisings. Because of the disorganization of these farmer rebellions and quick suppression by governing elites, most did little more than dramatize the economic plight of the farmers. Yet, even in defeat, some of these uprisings resulted in significant changes down the road.
Farmer rebellions continue to this day. France is often embroiled in farm demonstrations, and farm discontent in India in recent years has resulted in many government concessions including increased tariffs on pulses which affect Canadian pulse production. In 2008 in Argentina, the government’s attempts to tax and transfer farm wealth to the nation’s poor resulted in near shutdown of agricultural exports and the Argentinian economy.
However, armed rebellion and social unrest is not the only way farmers have brought about change. Farmers, by nature, are entrepreneurial, adaptive, and disruptive. The farm settlement of North America was as much a result of the inability to own farmland in Europe as it was the desire to break new prairie sod. Farm mechanization was as much about loss of actual horse power to the First World War effort as it was the introduction of the tractor. And the birth of the co-operative movement was as much a revolt against the power of grain traders and merchants as it was about farmers wanting to market their own production.
But the pendulum of power has swung far away from farmers once again. North American farmers do not have the numbers for a populist uprising in support of higher commodity prices, lower costs, or tax relief. Nor do individual farmers, the remaining farm co-operatives, or even governments have the market power of the global corporate forces which now dominate agriculture.
In 2013, two Silicon Valley visionaries, Charles Baron and Amol Deshpande recognized that information is now what drives farm success. They also saw that farms were producing stacks of information, yet many farmers did not have the knowledge or ability to effectively use the raw data generated on their own farms.
Even more worrisome was that the information was being mined by corporate interests and was being used against the financial well-being of the farmers themselves.
The dominant corporate giants supplying farmers with inputs and equipment have greatly expanded their focus to technology and information, which is why John Deere displayed a combine at the Consumer Electronics Show in Las Vegas in January.
In an interview with Engadget, John Deere’s director of technology innovation Julian Sanchez announced, “We do consider ourselves a technology company. We wanted to engage the tech community and tell the story of agriculture.” John Deere has come a long way from selling plows to farmers!
Baron and Deshpande decided a new hybrid farm organization mirroring a typical tech startup was needed to enable farmers to harness the information age and regain some market power. The key would be to solve farmer’s problems first and worry about profits later.
Startup funding would have to come from like-minded, venture capital funding. Baron stressed that it was critical to find the right kind of investor. Investors had to be independent of conventional corporate agriculture, they had to be tech focused, and most importantly he wanted investors who considered the social impact of funding.
Between 2014 and 2018, this startup raised over $200 million in venture capital, primarily from seven funds. Baron points out these are long-term investments. The funds are not looking to cash out in two or three years. Rather, Baron says, the venture is designed for returns over decades, and to help generations of farmers rather than to turn a quick profit.
The real problem, according to Baron, is a lack of good information. That is why farmers end up taking the most risk yet realize the lowest profits in the food chain.
Instead of unbiased information flowing to farmers which would allow them to determine how seeds and inputs are working in the real world and what a fair price for those inputs would be, the information is primarily flowing to industry and is being massaged by industry and retail in order to sell more products at higher prices.
That is the problem Baron and Deshpande set out to solve.
This was not easy because of the conflict between farmers and industry. Every major company is continually adding more technology. Baron claims this supports industry but at the same time increases farmers’ costs without clear benefits to those farmers. According to Baron: “No one in the agricultural technology field was truly independent. No one was putting farmers first.”
And so, the Farmer’s Business Network was born. The mission of Farmer’s Business Network became: “to create a future of farming that puts farmers first by democratizing information, providing unbiased analytics, and creating competition for farmers’ business.”
The co-founders decided on a flat-rate membership fee which would allow farmer members access to the entire FBN platform. Baron explains the typical acreage-based fee currently charged by many advisory companies is grossly unfair. While acreage-based fees make sense for services like soil testing, where more acres takes more time to sample, that is not how software and technology analysis works. Besides, an acreage-based fee tends to block larger growers from utilizing the tech as costs increase.
The information that forms the backbone of FBN would be raw data crowd-sourced from FBN members. Members would be free to submit as much or as little data as they want. All data submitted is analyzed and then compiled anonymously so that members can compare their actual farm data with averages of the submissions from other members who use similar products on similar soil conditions under similar weather.
In the past four years, FBN has grown from an online site where members could compare seed varieties between farms, to include: satellite imagery of members’ fields, field mapping, a place where members can price compare inputs, where they have the ability to purchase inputs online, a marketplace where members can sell their crops, and where members can even purchase crop insurance and FBN health insurance.
FBN also offers input financing to farmers. It has become an e-commerce platform serving both FBN members as well as suppliers. FBN Direct now offers members over 1,200 seed, fertilizer, pesticide, and other products.
This year FBN is introducing F2F seeds. FBN has developed their own seed genetics in the U.S. and are selling new corn and soybean varieties.
FBN will soon be marketing the first gene-edited seed in the industry. It will be grown under contract for specialty markets. Growers who contract will be able to diversify their farms by growing a unique, higher-value crop.
Baron compares farms to oil wells. “Think if every oil well had a different owner yet there were only a few refineries to sell oil to. That is the situation farmers are now in. There is more and more consolidation of the agriculture industry, and where does that leave the grower? FBN enables online comparisons and negotiations. It is a new way of operating and offers farmers more competition.”
This is what has FBN has accomplished in just four years. And to think that it all started with two precision farmers seeking help from Silicon Valley to find a way they could compare seed varieties between their farms. FBN was: “Conceived by farmers, built by innovators and improved together.”
Think of that last farm conference you attended. Think of the information you gleaned from the speakers. Now compare that to the value of the information you gathered from farmers asking questions of the speaker and from the information sharing between yourself and fellow farmers as you were sitting around the conference tables or during breaks.
Farmers have been learning from fellow farmers since agriculture began and this is exactly what FBN offers. It’s a chance to share and learn from millions of acres of actual farm data generated by thousands of farmers from across the U.S. and now Canada. Now this is exciting!
FBN in Canada
Tom Staples is head of FBN in Canada. He became the first Canadian employee of FBN when he was hired in November 2017 and over the past year was responsible for enrolling more than 700 Canadian farms and some five million acres of cropland.
The annual cost of membership in FBN in Canada is $800. According to Staples, this fee provides growers with access to satellite imagery of fields, field maps, input price transparency, and seed performance information at no additional cost. It also enables growers to price and purchase inputs through FBN Direct, often at a significant discount to local retail prices for the same input.
Membership also allows growers to input their own data to the FBN data base to enable easy comparisons of their own operation to other Canadian and U.S. farms which have similar soil and environmental conditions. However, data submission is not a requirement of membership and Staples stresses all data is protected and kept anonymous. He says data is never identified by farm or sold to third parties.
Staples says FBN provides both online and telephone support for all membership questions. Furthermore, they have a team of local representatives across Canada who are the face of FBN. These reps are tasked with maintaining and increasing memberships. They are there to provide in-person assistance if required and to make sure members are comfortable with the FBN platform.
Says Staples: “The purpose of FBN is to make sure growers have all the information they need to make good business decisions.”
For more information, check out the FBN website or call the Canadian FBN head office at High River, Alberta (1-844-200-FARM).