Sentera CEO Eric Taipale poses with his company’s proprietary drone sensor in hand. The Minneapolis-based firm, which sells drone hardware and software to farmers, raised $14m earlier this month. Here’s what he had to say about it:
Why the decision to raise more investment in the first place and how did you settle on $14m?
Sentera has very strong revenue growth across the board, but it’s especially true for software and analytics and within our distribution channel. If we didn’t raise capital, we’d be forced to grow our business more slowly than aggregate demand is growing around us, and we’d miss out on opportunities. $14M was the right number for our business plan.
How do you breakdown the application of funding by area of spending/investment?
We’ll always be a technology-rich company, and R&D investment is robust and growing going forward. But the resources that back our commitment to be in the field with our customers, and to support marketing and sales of the products to our enterprise and retail channel partners is getting a huge boost.
How did you and the new investors meet?
We met with more than 100 potential investors during the raise. In VC, not everybody says yes, and not everybody who says yes is a good fit for the business. We are in one of the most sophisticated and complex verticals in the world – food and agriculture. We wound up with an absolutely amazing group of new investors. They knew the space, and took the time to understand our business, and the individual pedigrees are phenomenal.
Would you like to mention any of the prior investors?
Yes, without a doubt, Stoller USA, our first backer. They invested in 2015 and are still invested. Among other things, they’re a highly-regarded agricultural micronutrient and specialty products developer. They saw the potential for this technology before it existed. That takes courage and foresight.
Who is on the board of directors?
We’ll announce this shortly, so no spoilers. We’re very excited by the caliber of the team that sets our strategic direction.
As the leader, what is your vision for Sentera?
We want to be the best way for growers and producers to make better decisions using real-time data from the field. I could elaborate on that with pages of additional detail, but I like the short-form version best.
What is Sentera’s value proposition?
Sentera delivers data and insights to growers and their advisors much more quickly and at much lower cost than was previously possible. Sometimes, it’s as simple as that – we save time and therefore money versus a current practice. And sometimes we create the ability to look at things that weren’t feasible to measure before. This opens up entirely new opportunities. But in all of these cases, we are creating the tools for a grower to understand and react to developments throughout the growing season in way that best supports their business.
How do you sell the product/service?
We have fantastic partners, like John Deere and Bayer. Our ability to deliver results into their enterprise systems helps us sell, and we can leverage the broad distribution channels that already exist around them. We have relationships with most agronomic tool providers, and product OEMs. Our broad presence with universities and extension services gives our technology a brand excellent visibility.
What does your tech stack look like?
A lot of things are familiar – AWS, Tensorflow, React, Electron, OpenCV, Swift, lots of Python. But one thing that makes us a little different than traditional IoT or SaaS is that the data volumes we encounter are massive relative to the infrastructure’s ability to transport them to a place that’s convenient to support processing and dissemination. Our ability to make data actionable really quickly informs a data management stack and some workflow orchestration tools that are really cool.
What are some unique internal KPIs you track on the regular that validate your model?
Our market is really interesting because it runs according to the growing season, which nobody can control. So, we have a natural set of workflows that repeat every 12 months (at least in our part of the world.) Our engagement KPIs measure how often our customers are flying, and why. We’ve worked to create capabilities that are relevant from the time before seeds are planted until the time after harvest, because our customers are working their fields throughout. If we see a class of customer systemically lowering engagement and then re-engaging, we want to understand if this is natural, or if it’s because we’re under-serving part of the cycle. It’s been a very powerful insight tool.
Do you have intentions of doing any acquisitions of other companies near or far ?
We’ll never say never, but the focus following this raise is execution of an operating plan.
How many people FT/PT are on the team now?
What is the biggest challenge or question mark you see looking ahead in the next 12 months?
In the last two years, most of our large customers were in M&A activity of their own at one time or another. That’s quieting down now, and the new entities will be a little different and require some adjustment. Overall, it’s going to be positive. Sentera is going to grow rapidly over the next 12 months. We doubled sales this year, and we plan to double them again next year. This is a great situation to face, but I’d be crazy not to identify navigating that process effectively as our greatest challenge.