Tortuga AgTech helps growers by using robots that perform a variety of labor-intensive tasks in controlled environments like greenhouses or vertical farms, with an emphasis on harvest.
Denver, Colorado, USA
Eric Adamson was working in consulting for “very large agribusinesses around the world” before co-founding Tortuga AgTech in 2017 with colleague and automation engineer Tim Brackbill, now CTO.
Tortuga AgTech has raised ~$30 MM starting with the Stanford StartX program, THRIVE AgTech, and multiple venture capital rounds from Root Ventures, Susa Ventures, Spero Ventures, and most recently Lewis & Clark AgriFood.
Sustainable Development Goals
Tortuga AgTech has no deliberate company commitments to achieve any specific SDGs.
Tortuga AgTech’s mission is to build a healthier society, and a thriving planet, through smarter farming.
Will this business model stick?
We’ve been tracking business models in AgTech, and the most favored by high growth investors in robots is hardware-as-a-service, following the Amazon Web Services strategy to turn a capital expense (physical servers) into an operating expense (cloud access).
Yet will still hear from some robotics companies that farmers want to buy and own their equipment, having been burned by incumbents like John Deere that moved to as-a-service models but prohibited farmers from repairing their own equipment.
Here’s a company that is attempting to sell only through the as-a-service model for their precision strawberry harvesting robots. Do you think this business model will stick?
Business Model Moves
Leverage Networks, Provide Air Cover, then Launch As-a-Service
Why was Tortuga AgTech able to launch with an as-a-service model? This approach to financing a costly hardware robotic build becomes even steeper for investors when the product is not sold but instead is the vessel for delivering service. The short answer: the two co-founders had near perfect pedigrees and leveraged their networks to buy time, and enough capital, to advance beyond incumbents and other startups. Here is a case of the Stanford-Harvard-McKinsey personal networks providing a significant advantage to a startup, and given the company full optionality over their choice of business model.
Stealth Mode Pedigreed Founder
Eric Adamson was working in consulting for “very large agribusinesses around the world” before co-founding Tortuga AgTech in 2017 with colleague and automation engineer Tim Brackbill, now CTO. Adamson is a Stanford engineer with a Harvard MBA who previously worked at McKinsey. Brackbill was a Berkeley mechanical engineer who met Adamson while working at McKinsey. Together the pair has a double whammy skillset for the type of robot founder who is celebrated by Silicon Valley funders – two engineers with business smarts and just enough time in top tier consulting to identify a market need.
Early Acceleration and Funding
Tortuga Agtech received early support and/or funding from StartX, the Stanford Alum accelerator, and the THRIVE AgTech accelerator run by SVG ventures – two top tier tech and agtech ecosystems. The pair were then able to raise $2.4 MM from Root Ventures and Susa Ventures to work in stealth mode to provide enough time to develop their robotic systems for harvesting fresh produce in controlled environments, starting with strawberries. An additional $5 MM was raised from Spero Ventures just two years later before announcing commercialization plans.
Tortuga AgTech’s approach was also funded by National Science Foundation SBIR Phase I and II Grants for approx. $1.8 MM for autonomous harvesting, mapping, and forecasting for fresh produce through application of robotics, computer vision, and machine learning.
Both grants reveal the scientific and company IP benefit of developing precision robotics: while more capital intense these systems require less water (~90% reduction), chemical use (~50-70% reduction), and fertilizer use (~50% reduction) while potentially reducing the required labor. Tortuga AgTech’s focus is a novel approach to “temporospatial tracking of specific fruit as it moves and changes over time, gathering data of unprecedented detail on plant life cycle” to make sure the fruit is ripe before picking. The ultimate aim: “a novel precision agriculture solution.”
From Automated Greenhouses to Robots for Farmers
Early signals from Tortuga AgTech indicated that they wanted to develop their own highly efficient, robotically managed and automated greenhouses that grow high-quality produce close to where it will be consumed, similar to Aerofarms and other hydroponic growers. Yet along the way the company focused more narrowly on delivering one of the toughest robotics challenges: a harvesting robotic system with indoor and greenhouse strawberry growers as their first customers.
Launching with a Flexible System
Tortuga launched their strawberry harvesting robot as a flexible platform that can be adapted to work on other crops like indoor-grown tomatoes or outdoor table grapes, all autonomous robotics that pick produce, and work in unstructured environments.
The company raised an additional $20 MM from Lewis & Clark agrifood in order to commercialize and likely to capitalize the cost of offering the pay-per-pick business model. As mentioned above, that $20 MM is critical for offering this type of business model because it means the robots stay on the balance sheet of Tortuga, not the farmer, and Tortuga can only realize revenue one month at a time based on the amount of kilos picked. No other company in the strawberry robotics harvesting space has raised such a large amount of capital, so Tortuga AgTech has strategic advantage if their as-a-service business model takes off.
Business Model Reconfigured for Continuous Service
Robots-as-a-Service Value Proposition
Tortuga’s robots-as-a-service model is simple and easier for a farmer to evaluate: they get paid by the kilo for the produce that its robots pick.
The farmer math here is simple – no robot to purchase, just a comparison to labor costs to reach the same number of kilos, a strawberries-to-strawberries comparison. What does this mean for human labor on strawberry farms remains to be seen, but if you talk to a grower access to available labor has been their biggest struggle since before COVID19 began.
Additionally, Tortuga is developing services that make use of their machine learning model, like data-driven forecasting and other types of cultivation services, which are charged as a typical SaaS model or price-per-Hectare. What the ideal value proposition for this data service will likely evolve as Tortuga works more closely with farmers to determine the highest value decision and cultivation service.
Robots are the Lead Idea
In many successful connected device models, hardware may take a backseat to the needs and pain points of the customer. For Tortuga AgTech, however, it’s all about the robots, front and center, and how many advances they’ve made to solve some of the most challenging problems in harvesting. But of course with a pay-per-kilo pricing model, Tortuga AgTech is not positioning based on Unique Selling Propositions or features or benefits. It’s all about the comparable benefit in yield and ripeness.
Data Rights and Rights to Repair Transparency
Despite the persistent complaints from farmers and new legislation that addresses the right-to-repair farm equipment, there are no early signs that the robots-as-a-service model poses the same challenges. Perhaps this is because the customer believes that robots are a function substantial machine learning and data analysis pipelines in order to effectively run (verses a tractor, which is primarily a mechanical device).
Yet what about the thousands of years of agriculture knowledge training the data? Who owns the source and machine learning data for a strawberry-picking robot, and what does it mean for indigenous practice, agroecology advocates, and other potential consumer-driven social movements that may question robotic and AI approaches to determining what makes the best strawberry? For now, it seems this data belongs to Tortuga AgTech and may be its most valuable asset, but one that may benefit from forward thinking data strategies that map out how the sector might shift as people become even more aware of the provenance of their food.
Will it Stick: Robots-as-a-Service
What do you think?
We’re checking in with hydroponic and greenhouse growers to get their take. For those that have adopted a table cultivation method, the Tortuga AgTech offering is intriguing, as long as the price per kilo is in line with their expectations. The as-a-service positioning works for now, as the decision requires no upfront capital expense and will accelerate adoption. We’ll be checking in as the data service evolves to develop more meaningful value propositions for their end customer, but it’s clear that it is easy to add a pay-per-hectare model to a pay-per-kilo model than it is to add a data service to a standard equipment sale. Watch this space!