Monarch Tractor CEO says $133 million raise will help it escape “a very challenging time”

Monarch Tractor was in a tricky spot late last year as the autonomous electric tractor startup juggled growth and an uncertain fundraising environment. Now, with $133 million in new funding, CEO Praveen Penmetsa told TechCrunch that the startup is moving toward greener pastures.

The $133 million Series C funding round was co-led by agri-food technology impact firm Astanor and HH-CTBC Partnership LP, a Foxconn affiliate fund. The new round values ​​the startup at more than US$500 million. Monarch created US$220 million to date.

Monarch has integrated technology into electric tractors that offer customers a variety of automated driving features. The company has about 400 tractors in the field currently being used by customers, according to Penmetsa, who said the new round of financing will help Monarch begin “producing more tractors, supporting our customers also through sales and services, and then continuing to expand to more states.”

This expansion comes with some changes. The company recently laid off some workers, TechCrunch has learned. Penmetsa said the cuts were “less than” 15% of Monarch’s 250 to 300-person workforce and are part of a necessary reshuffle as the young company looks to support its growth – especially on the after-sales side and of the service.

Penmetsa said part of Monarch’s business was not keeping up with the number of tractors it was putting out into the world. Monarch’s production grew in 2023 along with its geographic footprint, as the startup moved away from its initial market of vineyards and fruit farms in California and began working with dairy farms, airports and other customers across the country.

“We didn’t have enough coverage in those areas in the early days,” he admitted.

These difficulties, combined with delays in the fundraising process – thanks in part to a much weaker overall investment cadence in agtech in general, according to PitchBook data – made the second half of 2023 “a very challenging period for Monarch,” Penmetsa said.

But Penmetsa believes that has changed. Earlier this year, Monarch rebuilt its service and support teams.

“Our customers are saying that their service and support now in these six months is better than [prior] six months,” said Penmetsa. This increased support helped drive 15% of Monarch’s customers back to the startup to buy more tractors – a number that Penmetsa says was above the company’s initial expectations.

“Don’t get me wrong, it’s a number I would like to be higher, like any CEO, and I think as we continue this fundraising will really help us invest in sales,” he said. “This fundraiser will allow us to really give confidence to our dealers that we’re here for the long haul and that, you know, we’re here to support our products, and that they should also join the movement to get these tractors to farmers. .”