Select excerpts from Subscribed Podcast with Renée Vassilos, agriculture economist and founder of Banyan Innovation Group.
Renée Vassilos is an agricultural economist with over 15 years of industry experience in the field with organizations such as USAID, USDA, and John Deere. She has worked globally in the US, Europe, Asia, and South America including six years based in Beijing and two years in Amsterdam.
Renée is the founder of Banyan Innovation Group, an agribusiness consulting practice that supports growth-stage agribusinesses and investors. She is a thought leader on how innovation will transform agribusiness and the farm, and is passionate about bringing regenerative farming practices to scale.
We talk to Renée about the agriculture industry and the impact of digital disruption, as-a-service business models, new pricing models, and more.
Tell us a little about your consulting practice. How do you work with agribusinesses and the investor community?
Banyan Innovation Group works with growth stage AgTech companies, companies that are trying to break into the agriculture space. Our engagement looks different depending on where they are in their growth cycle, from very early stage through to helping develop distribution strategies when they’re ready to actually hit the market.
On the investor side, we support what is very much a growing body of investors that are looking to get into the agriculture space. We support them to do due diligence on their investments in agriculture.
You’ve spent a significant portion of your career with industry giants such as John Deere. What was that like? How much impact is digital transformation having on the agriculture industry?
My time at Deere was incredible. I learned a lot. I had the opportunity to work on both the strategy side of the business and also the sales and marketing side of the business, and from a global lens. What that did is afford me the opportunity to see from a global perspective, how farms are different, and then more often than not, how similar they are.
In terms of digital transformation’s impact on the agriculture industry, I would argue that it’s just starting. What we’re seeing is that we’re still in the iterative stage. For example, there’s GPS guided equipment now. You still have an operator in your tractor, but he’s pretty much there just in case of an emergency. The equipment is operating on its own for the most part.
What you’re starting to see now is that we’re utilizing digital influence to be able to understand and do more prescription planting and spraying. An exciting output of digital transformation is that we’re becoming much smarter with how farming is actually being done.
As an agriculture economist, what opportunities do you think the Subscription Economy presents to the industry?
I see it having a similar impact as what we’ve seen in the transportation space, where I see the total value of the industry, the total value of agricultural production will increase significantly. The Subscription Economy fosters customer-oriented solutions as a service. It’s basically the platform to deliver those types of services, and the way I see those solutions supporting growers is allowing them to farm more diversified operations–which are inherently more complicated, and which will result in a higher value activity–so they’ll be able to produce more higher value crops, increase crop rotations, etc. I see it as a tremendous opportunity to increase the total value of the industry.
We work with companies such as TerrAvion (aerial imagery), FarmLogs (software), Caterpillar (Machinery) and Yara (chemicals) and are beginning to see some traction in the space. Most companies we are in talks with want to make the switch to an “as-a-service” model but are finding it difficult to make the transition. What advice do you have for such companies? Where should they start?
Historically this industry has been very siloed, so you don’t have much collaboration with different partners in the space. You just don’t see much interaction. The advice that I would give is to collaborate. If you’re really trying to solve a farmer’s problem, he doesn’t have the luxury of separating his aerial imagery solution with his machinery. He needs those things to work together, and because he’s trying to operate, he’s trying to ultimately turn a profit, and ensure that he’s farming in such a manner that he can continue farming for many years into the future.
To me, the opportunity is in collaboration. That’s a critical piece that’s been missing historically, and there’s tremendous opportunity to serve the customer through increased collaboration, up and down the value chain.
We see some of our customers who are equipment manufacturers or OEMs, and they have experimented with pricing around the outcome or usage rather than for the machine. Are you seeing more of this model?
I would say this is absolutely of interest for the Ag space. There’s actually a growth of equipment leasing but where I see the shift going is in the equipment-as-a-service model, which is scalable. The leasing was a solution for very large scale operations, but equipment-as-a-service is something that’s scalable for both large scale and small scale operations. This would allow for more diversified production – if you can alleviate some capital cost in order to produce a more robust, diversified set of crops, you’re helping to mitigate the cost of having different types of equipment to be able to harvest and spray those crops. There’s a tremendous opportunity there.
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