A few months ago, the board dismissed Sara Menker, the CEO and founder of the agricultural data platform Gro Intelligence. Despite obtaining emergency capital in March 2024, the New York and Nairobi-based company will close.
AgFunderNews said on Friday that the company could not secure additional funding from current and potential investors despite the March connect round.
Gro Intelligence’s financial struggles came to light in February 2024 when reports showed that the organisation faced challenges in meeting its payrolls and pension payments. This news was shocking, given the company’s history of successful fundraising efforts. Despite raising $117 million in funding, Gro Intelligence struggled to manage its finances.
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The organisation’s last public fundraising effort was an $85 million Series B round, backed by notable investors such as Intel Capital and Africa Internet Ventures. This investment had been seen as a significant vote of confidence in Gro Intelligence’s prospects, making the company’s subsequent financial struggles all the more unexpected.
The report of Gro Intelligence’s financial difficulties sparked concerns about the company’s ability to continue operating and ultimately led to its shutdown announcement. The company’s struggles serve as a reminder that even well-funded startups can face significant challenges, and fundraising success is no guarantee of long-term viability.
Gro Intelligence Fights Fraud and Sudden Decline
The company fired 60% of its employees in March 2024 and plans to fire the remaining employees in Nairobi and New York. However, a small crew will remain to assist with closing down operations.
Former workers sued Gro for alleged labour violations after it let them go without warning in March. AgFunderNews claims that the Securities and Exchange Commission (SEC) is also investigating the company for possible fraud.
Gro Intelligence was founded in 2012 by energy commodity trader Sara Menker and collected data from the government, financial markets, and weather agencies to give agricultural companies actionable insights. One of its biggest customers is FMCG company Unilever.
While the current investigations and legal woes have escalated the company’s problem, its collapse was caused by a challenging fundraising environment and a market product compatibility issue.
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Gro Intelligence Expanded and Failed
It had attempted, but failed, to present itself as a platform for food security to a small Asian nation and an oil-exporting Middle Eastern nation. AgFunderNews said that the company had also made several attempts to interact with the US government under other guises, but it was only gaining small amounts of business here and there.
After iProcure, a distributor of business-to-business agricultural products, and Copia, a business-to-consumer e-commerce platform that went into administration in May, Gro is the third well-funded company that will shut its business in 2024.