VisionTech’s first foray into agtech, Smart Apply, Inc., ended extremely well with an exit to John Deere roughly 18 months after our first investment round. So when I bumped into Scott Prince, a serial entrepreneur and now CEO and co-founder of Croft at a recent Techpoint Venture Connect event, I was interested to learn more about what Scott was doing with his tech platform that automates and streamlines HR and more specifically, H-2A, administration. It was a great discussion which ultimately led to an invitation to Scott to present to VisionTech Angels investors on Monday, July 1 at 12 noon. Here’s a quick preview.
BP: What is the problem you’ve identified in the agriculture industry?
SP: U.S. agribusinesses have a huge issue with back office operational efficiency, cost, and compliance, especially those that are labor-intensive. Labor costs as well as shortages are critical issues. There is a mass shortage of domestic workers, forcing many agribusinesses to use the complicated and expensive H-2A Visa seasonal, nonimmigrant ag worker program. H-2A is a non-capped seasonal Visa for almost 100 eligible countries, with the majority of the 400,000 annual farmworkers coming from Mexico, Central America and South Africa. H-2A has more than 200 rules and the bureaucracy behind the program is complex and as hard to navigate. Since labor is usually one of the highest input costs for a farm, securing a competent workforce in a compliant and lowest-cost way is essential to farm profitability and viability.
BP: How are you solving it with Croft?
SP: Croft has built and continues to enhance a collaborative ag operations platform that automates and streamlines farmers’ back-office operations administration by centralizing and managing data, forms, and workflows for the agribusiness, domestic and H-2A workers, H-2A agent, and service providers. We’re helping 15,000 farms that rely on H-2A workers and the rest of the 250,000 labor-intensive farms be more organized, efficient, productive, compliant, and profitable. Croft Case Manager streamlines H-2A agents’ internal operations, and those agents resell Croft Connect to each of their farm clients. Case Manager and Connect work in tandem to bring all participants together collaboratively in the same platform for the first time to save all time & money while increasing overall compliance.
BP: Croft was founded in late 2022, but already you have great traction.
SP: Yes, we do I both funding and customer revenue. Our first major investor was Purdue University DIAL Ventures in partnership with High Alpha Innovations. Purdue invested $950,000 in pre-seed money to fuel the development of our platform. Croft has attracted other agtech venture funds, including Ag Startup Engine and Ag Ventures Alliance. We have paying customers throughout the United States and have onboarded notable operations like Tom Farms and Beck’s Hybrids here in Indiana. These early adopters provided critical feedback, allowing us to refine our platform and demonstrate substantial value in the market.
BP: What are farmers and farm agents liking about Croft?
SP: We have the ability to cut their administrative time in half, be prepared for government audits and inevitable investigations, increase the performance of their workers who don’t have to worry about compliance, and finally, increase farm profitability. Our platform is also very easy to learn and use. It’s tough to make a buck in farming while you’re trying to feed the world and your family. We want to make farming financially viable through more efficient, effective back-office operations.
BP: What’s your revenue model?
SP: Typical B2B SaaS with annual per farm platform and per farmworker user fees and add-on modules to follow. The typical SaaS direct go-to-market activities of advertising, engaging via demos, converting trials, selling, upselling, and renewing are more difficult and much longer for agriculture given its late tech adoption curve and rural/remote geographies. Croft has a direct sales program, but most of the emphasis is on our indirect Partner Reseller program, launching with H-2A agents that 80% of H-2A growers use. This indirect model decreases our customer acquisition cost and by sales cycle by over 85%.
BP: Any competitors?
SP: No one is doing exactly what we’re doing. The industry is still largely paper-based.
BP: What round is this?
SP: This is our seed round. Grit Road Partners, a Nebraska-based, agtech venture firm, is leading the round. We look to raise $1.5 million with a likely oversubscription up to $2 million.
BP: How will these funds be used?
SP: Much of it will go to sales, customer support and marketing. We’re taking a “white glove” approach to sales and service to develop strong, personal relationships with value-added resellers and ag customers, spark referrals, build our brand and position Croft as a thought leader. We’ll be attending targeted industry conferences, participating in podcasts, and networking with ag bureaus for national awareness, with very specialized and local co-marketing activities with Resellers.
BP: Give three reasons why VisionTech members should invest in Croft.
SP: First, we’re solving a very critical set of problems for the U.S. agriculture industry, one that has been overlooked by leading tech vendors. Second, our current solutions have extra strong product-market fit, with a strategic roadmap supporting business intelligence-based services that farms will depend on to increase profitability. Third, we have a seasoned team with deep technology, agriculture, SaaS, finance, operations, sales, and marketing experience that knows how to launch, grow, and exit SaaS companies successfully.
One more thing investors will like – we’re certified as a Qualified Indiana Business and investors are eligible for the Indiana Venture Capital Investment Tax Credit.
BP: If people want to learn more, where should they go?
SP: Our website of course. But I highly recommend watching this video for more.
VisionTech’s July 1 Pitch Event will have one virtual session only at 12 noon ET. This is a fast-moving opportunity so please plan to join me, Scott and fellow VisionTech investors. Please register here.
