ONDO, the end-to-end agritech startup for small and medium agribusinesses, closed a €1M round from a group of Bulgarian VCs and business angels with the goal to develop its partner network of system integrators, its automation software, and expand internationally. The lead investor in the round is Eleven, while Sofia Angel Ventures is the biggest contributor. BrightCap Ventures, MFG Invest, HR Capital, and Georgi Zahariev, one of the co-founders of DynamoSoftware also participated in the round.
Founded at the end of 2019, by Ilia Iordanov, Ivan Dragoev, and Ivaylo Enev, ONDO is a modular system for the monitoring and control of plants in real-time which allows farmers to reduce costs associated with water, energy, and fertilization. ONDO is installed in greenhouses, open farms, vineyards, and orchards and combines hardware with a software platform.
Ivaylo Simov, Managing Partner at Eleven, which made a €300K pre-seed investment in ONDO last year, states: “Ondo is one of our most emblematic investments in what we internally call the “Future of Food” vertical. As with most of our pre-seed investments, it is envisaged from day one when we invest initially that the companies will need further rounds of financing. Given our good rapport with the founders and the positive developments of the business, we were more than happy to lead the follow-on round and help them grow.”
The regional market need for automation in agriculture
Before founding ONDO, Ilia Iordanov and Ivan Dragoev had been running their own software development and consultancy company, IndigoVerge, for 16 years. That helped them gain valuable experience in services, IoT, and software building. Out of personal interest and need, the two of them started researching the existing agri automation solutions for small and medium farms in the region. The problem that arose was that there was not any affordable and quality alternative for automatization that could bring extra value to the automation investment of the small and medium agribusinesses.
The idea of ONDO was then born as a result of the market gap they identified and of their long-time experience with software development. The two tech specialists were joined by Ivaylo Enev who has agricultural expertise., In February 2021 the team installed the automation solution with their first client in North Macedonia. ONDO aims to address the lack of specialized labor force in agriculture, the low efficacy in the use of resources such as overwatering and overfertilization, and the ensuing bad climate and environmental effects.
ONDO’s position in the regional agritech sector
Simov shares that Eleven is currently doing a more in-depth overview of the agritech sector in the SEE region as this is one of the fund’s core verticals. “Perhaps a curious fact is that farmers in the region are usually first-generation, unlike Western Europe where there are long traditions and passing of farming practices from generation to generation. However, this also means that local farmers are not dogmatic and actually quite open to using the most modern practices and also to apply innovative methods, which bodes well for agritech startups from the region to test their products and services,” he adds.
According to the co-founder Ilia Iordanov, the key differentiators of ONDO are its price-competitive business model, the focus on software development, and the provision of continuous support for its clients. In terms of business model, ONDO combines a low initial investment with an annual subscription fee to decrease the cost for farmers and make automation more affordable. When it comes to software, Iordanov highlights that the biggest value-added of their solution comes from the platform since most of their competitors specialize in the development of hardware without making it easily integrate with a quality platform.
The milestones and future goals of ONDO
For its short existence and despite the limitation imposed by the Covid-19 pandemic, ONDO has managed to attract 15 clients in Bulgaria and North Macedonia and develop a fully functional end-to-end automation solution that has won a number of awards and business recognitions. From July to October, the team of ONDO will join one of the most recognized agri-food innovation hubs in the world – EIT FAN in Israel, where they will be working with experts from institutes and universities as well as with business representatives to make a pilot project, find the optimal direction to scale their product, and connect with potential future investors.
In the short term, their team, which consists of 15 people, will aim to boost sales in the Balkans and expand to Western European markets, for which they will need to develop a robust partner network. In addition, the startup will focus on the development of its software platform and will start working with subcontractors, system integrators, and resellers to optimize the efficiency of its operations.