FarmHedge: Connecting farmers with the best deals
Irish Times Innovation awards finalist in the IT & fintech category has got the backing of Austrian agri-business giant RWA
FarmHedge co-founder, computer scientist Bernardino Frola and co-founder and chief executive John Garvey
FarmHedge chief executive John Garvey has combined his academic expertise with his family background in farming to create a technology platform that facilitates communications and transactions across the agriculture supply chain, with financial benefits for both farmers and the agri-business sector.
“I work as a lecturer in the business school in UL, but my father is a beef farmer,”says Garvey. “That gives me a good understanding of agri-industry challenges. The area of research I specialise in is finance, market systems and how information flows in them, and I looked at agriculture and information systems in my PhD. One of the biggest challenges in agri-business is trying to co-ordinate the decisions of farmers. I set out to develop something that would make it easier for information to flow.”
Garvey and his co-founder, computer scientist Bernardino Frola, built the prototype for the platform with support from the Enterprise Ireland Commercialisation Fund between 2014 and 2016. “We spun out of university in late 2016, and were already getting some interest from Dairygold and other Irish agri-business firms at that stage.”
No complex software download is required to use the service which operates though a web interface and a phone app.
“It’s a web platform which farmers and suppliers can log into securely. Suppliers invite their customers to join FarmHedge. The farmer sees the invitation and downloads the FarmHedge app, which they can use to order anything from fertiliser to farm machinery parts.
“Agri-business companies can streamline opportunities. If they see that 30 or 40 farmers are all looking for feed, they can push an offer through the app to offer the group a better price for buying together.”
This has obvious advantages for farm input suppliers who can use the platform to drive up business volumes, but farmers also gain.
“Farmers are out and about most of the time,” says Garvey. “They can have up to 10 key suppliers to manage. We are giving them one mobile app to connect with all their suppliers. With two to three taps on the app they can order any product they are looking for at the best price.”
It also puts the farmer in control as they see who is sending the offer and can choose to accept or not.
“Farmers are able to sell their produce as well. Crop-buyers can initiate offers to buy large volumes from farmer co-ops. The co-ops can then forward the offer to individual farmers, who can participate by using the FarmHedge mobile app.”
The company achieved a major breakthrough in 2017 when it was invited to participate in the AgroInnovation Lab global agtech accelerator in Austria and Germany. Working with Austrian agri-business company RWA, FarmHedge was successfully piloted with a number of co-ops in Austria. That led to RWA adopting FarmHedge for its seed, fertiliser and crop divisions.
“RWA is a massive company with 80 per cent of the agri-business market and is the biggest grain wholesaler in Austria,” says Garvey. “It works through farmer grain co-operatives which are known as Lagerhauses. The RWA grain-buying division may receive an order to buy 5,000 tonne of organic wheat with specific characteristics. This is easily loaded to the secure FarmHedge portal and the offer is published to the company’s network of 42 Lagerhauses.
“What happens traditionally is that the order would be fulfilled through a series of phone calls and emails. This can take up to six hours to complete. Our system is a fully integrated supply chain operation, and dramatically reduces the time taken.”
Success in Austria has proven the value of the solution.
“It’s a huge industry, and we are only scratching the surface as yet,” says Garvey. “We are very optimistic that we can spread it in Europe and beyond. In the case of Austria we are working with the dominant player, but in Ireland and other countries there are multiple companies who can all benefit.
“We have an ongoing trial in Hungary at the moment with Syngenta, and a couple of companies in the UK are trialling it, as is Abbey Machinery in Ireland. We are also going to the US shortly with support from Enterprise Ireland.”
The company is planning to close a Series A funding round by March or April of next year.
“We are planning on raising €1.5 million and will then build a sales team for Europe and the US and grow the development team. That will keep us going for three years or so, and our target is to be profitable by March 2021.”