Pontifax Exits Precision Ag Company Blue River Through $305M Deal with John Deere

The Pontifax Global Food and Agriculture Technology Fund announced its first highly successful exit through the sale of portfolio company Blue River Technology to John Deere in a deal valued at $305 million.

“We think this exit is a real benchmark transaction that demonstrates the value of robotics and related technologies, and their ability to fundamentally impact the ag supply chain,” Phil Erlanger, co-founder and managing partner of Pontifax AgTech, told GAI News.

Founded in Santa Monica, California, in 2014, Pontifax is a leading growth capital investor that works with its extensive network of growers, tech experts, and strategic corporate partners to make targeted investments in fast-growing businesses that are developing proven technologies that improve agricultural production, nutrition, health, sustainability, and efficiencies along ag supply chains.

To date, the fund has made seven growth capital investments in five technologies, including leading a $17.5 million Series B for Blue River Technology in December 2015 that also included Monsanto Growth Ventures, Syngenta Ventures, Khosla Ventures, Innovation Endeavors, and Data Collective.

Blue River Technology produces cutting-edge robotic systems that can gather precise data on a per-plant basis including health, structure, and needs, using computer vision and artificial intelligence. By doing so, the technology enables a farmer to treat each plant in a field in real time, while cutting the need for agri-chemical application volumes by up to 90 percent compared to traditional application systems.

"Blue River is advancing precision agriculture by moving farm management decisions from the field level to the plant level," said Jorge Heraud, co-founder and CEO of Blue River Technology. "We are using computer vision, robotics, and machine learning to help smart machines detect, identify, and make management decisions about every single plant in the field."

This “See and Spray” platform saw its beginning in lettuce production, but with the funding of the Series B behind them, Blue River has been able to refine and commercialize its technology to apply to a wider range of crops including specialty vegetables and broad acreage row crops, and to successfully launch an intelligent weeding solution for cotton production in 2017.

It is this plant-by-plant ability that initially drew the attention of Pontifax.

“Blue River Technology is a unique company in its ability to observe every single plant in the field and to generate observations and act upon them in real time through precision spray application,” Erlanger told GAI News. “We looked far and wide in the ag space, and there’s no other [company] with real time individualized treatment abilities like Blue River.”

Blue River’s unique platform also stood out amid an increasingly crowded precision agtech space for John Deere, which has agreed to spend $305 million to acquire the company. Upon closing of the deal, which is expected to occur later this month, John Deere plans to have Blue River and its 60-person team remain located in Sunnyvale, California.

Erlanger noted the mutually beneficial nature of the acquisition for both Blue River and John Deere, stating, “The combination of John Deere’s distribution and industrial scale and familiarity with tech as it relates to ag equipment with Blue River will be impactful. With Blue River’s technology joining John Deere’s full fleet, it should really change the capability of their products.”

Making Blue River’s technology more widely accessible through John Deere will also benefit farmers’ bottom lines.

“This deal should create value for farmers through the creation of data and through offering the ability to treat crops with higher efficiency,” said Erlanger. “This should be a win win for everyone - a transaction that can be used as a case study that demonstrates why investment in agtech makes sense, and illustrates the benefits of doing so.”