The Estonian start-up, VitalFields, challenges the outdated view that farmers are remote from technology and somewhat wary of it. One of the founders and the CEO of VitalFields, Martin Rand, says that agricultural enterprises are in fact very open to new solutions, first and foremost due to circumstances: after all, every farmer wants to work his land in the most effective way.
This article was first published on Life In Estonia print magazine. By Ann-Marii Nergi.
This is where the web-based farm management system VitalFields helps. Its aim is to increase the efficiency of its customers. The services offered by VitalFields can be divided into three different but, from the farmers’ point of view, equally important components: weather forecasting, tracking climatic patterns to forecast plant diseases and farm management software for managing day-to-day activities and finances. Hence farmers are able to plan in advance what and where to cultivate in the next season and to draw conclusions from previous seasons. In doing so, they save a huge amount of time and have the ability to react quickly to such factors as changes in weather.
“Our grand vision is that the more farmers use the system, the smarter the system becomes,” Rand explains. “For example, we would like to forecast the phases of plant growth and to offer advice to farmers on that. To this end, we are currently gathering information from existing customers.”
He emphasises that clients should not be concerned about the information leaking to competitors or neighbouring farmers having access to their data. “We are aware that this information is important for the business activity of farms, ie plant cultivation, and we will only use this data to improve our system,” Rand confirms.
Currently, VitalFields has about a thousand clients all over the world, with the majority located in Russia and Ukraine. The reason? Market research revealed that whereas VitalFields has competitors in Western Europe, there are no similar systems in use in the east, yet the agricultural lands there are enormous. As a next step, the app is set to enter markets in Poland and Hungary, followed by Denmark and Germany.
Estonian and Russian investors
The start-up of Rand, a former Skype employee and the creator of Skype’s only enterprise solution, called “Skype manager”, and Vahur Meus, the CTO of VitalFields, who has previously worked as a back-end developer at Playtech, has been successful in raising investments.
Just recently the service received an injection of a half million euros. The sum meant for the development of the service came from Estonian and Russian investors and now the company will be able to focus on entering new markets and on development work. It was the third and the largest investment to date for VitalFields. The first investment, in the sum of €15,000, came from the start-up accelerator, Startup Wise Guys, a few years ago. The second investment, in 2012, of €250,000, came from SmartCap (the investment fund of the Estonian Development Fund), Arvi Tavast and Wiser Financial Advisers. In the third round, in addition to existing and new Estonian investors, the Russian investment company TMT Investments has invested in the start-up.
Alexander Selegenev, Executive Director of TMT Investments, says that, even though their investment policy is focused on more mature companies, they keep an eye on early-stage companies, as this allows them to establish relationships with promising teams. “This was the case with VitalFields. When we first met, we were impressed by the team and shared their belief in the growth potential of the market segment they were targeting, so we followed their successful progress. At a later stage, it was easier for us to approve this investment,” Selegenev says.
TMT has also invested in another Estonian start-up, Pipedrive. The two investments amount to €600,000 in total. Selegenev says that this is a typical approach of TMT. “Should the company demonstrate further growth, a small initial investment is often followed by further investments later on.” Therefore, VitalFields already has a likely investor for its next period of raising capital.
The article is published in collaboration with Life In Estonia magazine, the publication of the Estonian Investment Agency. Cover photo is illustrative (photo by Kaarel Mikkin/courtesy of EAS.)