Farmers are demanding electrification, automation, & insightful data

Farmers today face numerous challenges. Margins are razor-thin; agricultural labor is scarce and costly; and both buyers and governments are insisting on reduced emissions and more sustainability data.

In response to these pressures, the agricultural industry is undergoing an unprecedented transformation. Digitization, automation, and machine learning technologies are being applied across the entire agricultural ecosystem. Precision agriculture—the use of new technologies to increase crop yields and profitability, while reducing the need for land, water, and chemicals—is projected to reach $43.4B by 2024.

Monarch is rising to meet those needs for the compact tractor market.

Making clean farming economically superior 

Monarch makes the world’s first fully electric, driver-optional, compact smart tractor integrated on a single platform. They combine electrification, automation, machine learning, and data analysis to enhance farmers' existing operations, increase labor productivity and safety, and maximize yields.

With deep learning and sensing capabilities, the Monarch tractor can collect and analyze 240GB+ of data per day. This can be used for real-time farm implement adjustments, as well as yield and crop health metrics and long-term analysis—all stored in the Monarch cloud.

The end result? Lower overhead costs, lower emissions, and actionable data on sustainability and farm conditions.

A new generation of tractor, built on an integrated, productizable platform

Compact tractors are one of the most common agricultural tools in the world. Monarch’s suite of advanced features is designed to make it the safest, most efficient, and most versatile on the market:

• Power—field-swappable batteries, and works as a mobile generator

• Automation—driverless and driver-assist modes, or can shadow a worker on the job

• Universal hub—compatible with existing and next-generation farm implements

• Connectivity—data alerts, actionable insights and more, delivered to a phone or smart device

Beneath it all is the integrated Monarch.OS platform, which will support OEM partnerships and—in time—an entire digital ecosystem of apps and services.

Hundreds of deposits & 3 major awards for innovation

Since October 2020, Monarch has opened a manufacturing facility, expanded to 80+ team members, and rolled out their pilot series. By end of year, they will be deploying tractors to customers.

Monarch has earned recognition with a trio of industry awards celebrating their contributions to AgTech innovation:

• Product Winner, 2021 BIG Innovation Awards

• Tractor of the Year, 2020 AgTech Breakthrough Awards

• Top 10 New Products, 2020 World Ag Expo

They’ve leveraged their growing brand recognition to accrue 227 non-refundable deposits (and counting) towards tractor purchases. With a starting price of $58K, the team has the potential to generate at least $13M in revenue after deploying their tractors later this year. 

5 out of the top 10 US vineyards (by acreage)

are Monarch customers

The wine industry relies heavily on compact tractors, amounting to a 4K+ unit per year opportunity in the US. Monarch partnered with Wente Vineyards to test their platform and increase experience and visibility within the industry. Additionally, Monarch executive Carlo Mondavi is a fourth-generation winegrower and co-founder of Raen Winery.

Their go-to-market strategy targets vineyards on the US West Coast, but they plan to expand by targeting fruit and nut farmers around the world. 

Monarch also has customers from the food crops, dairy, solar, agricultural research, and emissions research industries who have put down deposits on tractors.

Three revenue streams and a detailed scaling strategy

Monarch has a three-tiered business model:

• Product sales—tractors, accessories, and related services

• Technology licensing—fees and royalties for the Monarch.OS platform

• Digital services—data, insights, and a productized app store

The team built a foundation for product sales, and plans to scale production rapidly. They project that they’ll have 1,800 tractors in the field by the end of 2022. By year-end 2024, Monarch expects that number to grow to 29K, with an additional 10K units from licensed partners.

In subsequent years, the team expects increasing benefits from the productization of the Monarch.OS platform, and will be positioned to grow their revenue from the attached digital ecosystem.

Tractors, Robotics, & Digital Agriculture

The global AgTech industry was valued at $26.8B in 2020. With food consumption expected to increase by 70% over the next three decades, the trends towards agricultural modernization and digitization seem unlikely to disappear.

With their strategic choice to build around the productization of their integrated Monarch.OS platform, Monarch is looking to define a space in three global markets:

• Compact tractors

• Agricultural robotics

• Agricultural data and Internet of Things

Together, these three segments are expected to represent a $110B combined market by 2025.

First mover advantage in smart electric tractors

Major manufacturers John Deere and Kubota have identified the electric tractor as a key product in 21st century agriculture. Neither company has announced moving beyond the prototype stage in this space.

In 2020, John Deere admitted that their automated prototype, dubbed Joker, would not be a commercial product “within the coming decade.”

Earlier this year, Japanese manufacturer Kubota projected that they would begin manufacturing electric versions of tractors and excavators in 2023. No information was forthcoming, however, about automation, data collection, or connectivity features.

$1.8B in 2024

Monarch’s two year strategic plan includes investments in:

• Scaling and hiring—already progressing rapidly

• Development for their next product, the Monarch 2.0

• Monarch.OS productization and licensing support

• Manufacturing equipment and tooling

• Digital services development

• Tier-1 supplier development

• International market pilots in APAC and Europe

Within 4 years, the team intends to build a multi-billion-dollar manufacturing and technology company—with the Monarch name synonymous with smart tractors, and Monarch.OS as the Android of the smart off-road vehicle space.

Industry & venture capital backing

Monarch was established in 2019 with support from Motivo, a product design and engineering firm focused on developing robust production-ready designs in accelerated time frames.

The team closed a $20M Series A funding round in Q1 of 2021. The round garnered global reach, led by Musashi Seimitsu Industry Co., Ltd., a Japan-based global auto parts company; CNH Industrial, a worldwide leader in agricultural and on- and off-road industrial equipment; and VST Tillers Tractors Ltd., an Indian tractor and implement company.

Other investors include Dennis Muilenburg, former Boeing CEO,  At One Ventures, a Silicon Valley venture capital fund, and MUUS, a sustainability-focused private capital group.

Praveen Penmetsa | Co-Founder & CEO

Praveen has nearly two decades of hands-on experience in translating creative visions into products for startups to Fortune 50 companies alike. He co-currently serves as founder and CEO of Motivo Engineering, a product-engineering firm with clients in the Mobility, Energy, AgTech, and Aerospace sectors. Praveen holds an MSME in Mechanical Engineering from the University of Cincinnati.

Mark Schwager | Co-Founder & President

Mark has over a decade of experience leading manufacturing organizations and has developed over 16 million square feet of manufacturing space. Mark previously served as head of the Tesla Gigafactory, leading the project from concept phase to construction. He also led the operations planning team and built the business systems for Tesla’s Fremont factory and led the manufacturing program for Tesla’s collaboration with Toyota for the Rav4 EV.

Carlo Mondavi | Co-Founder & Chief Farming Officer

Carlo is an expert viticulturist with experience in Organic, Bio dynamic, and Permaculture Farming. He is a fourth generation winegrower from the world-renowned Mondavi family and is co-founder of Raen Winery, as well as a partner at Continuum Estate. Carlo is the co-founder of the Monarch Challenge, an effort focused on elevating farming by eliminating herbicides and powerful chemicals from farms in Sonoma, Napa and beyond.

Zachary Omohundro | Co-Founder & CTO

Over the past two decades, Zachary has developed hundreds of tightly integrated intelligent electro-mechanical systems, bringing a full system design perspective to the development of never-before-seen products. Prior focus areas include mining robots, energy storage systems, electric vehicles, by-wire autonomous cars, and automated agricultural equipment. He holds a double degree in Electrical and Mechanical Engineering and a PhD in Robotics from The Robotics Institute at Carnegie Mellon.

In addition to the carried interest Republic Maximal LLC dba Republic Labs is entitled to for the syndicated investments it organizes, which are viewable at https://republic.co/companies under “Privately Funded”, certain principals of Republic Labs have personal interests in these investments, as disclosed below. When making an investment decision please review these disclosures as they represent pre-existing financial interests held by those principals of Republic Labs.