October 11, 2013
In one of the largest buys of a data analytics company, Monsanto has agreed to buy the Climate Corp. for $930 million, according to a Bloomberg Businessweek article, available here.
Climate Corp. is a data analytics company, founded in 2006 as Weatherbill, by two former Google engineers. The new company originally offered insurance against weather-related incidents, such as a rainout of a sports event or a concert cancellation, but quickly realized that its biggest market was the most weather-dependant business, agriculture.
Climate Corp. took years of data collected by the National Weather Service and other government agencies on crop yields, soil types, precipitation and more, and created an insurance product for farmers, according to an article by Take Part available here. Stacey Higginbotham at Gigom, explained, “Among the data the system knows are the shape of every single of the 20 million crop lands in the United States, what is grown on each every year, what the crop yields were, and the water-holding capacity of the soil. Each predictive simulation analyzes 5 trillion data points.”
“Data science is agriculture’s next major growth frontier,” Monsanto said in a press release available here. It is “an area that represents a potential opportunity of $20 billion beyond Monsanto’s core focus today.” Monsanto’s focus in the purchase is on precision farming and increasing crop yields. Last year, Monsanto purchased Precision Planting for $250 million. Precision Planting allows farmers to “use an iPad interface to adjust the depth and spacing of seeds they plant, increasing yields by 5 to 10 bushels an acre.”
For more information on biotechnology, please visit the National Agricultural Law Center’s website, here.