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Google and T. Rowe are investing big money in a digital marketplace for farmers

Key Points
  • Farmer's Business Network has raised $110 million in a new venture funding round led by T. Rowe Price and Temasek.
  • The company's marketplace helps farmers score fair prices on seeds and fertilizers.
  • Earlier backers of FBN include the venture arms of Google and Campbell's Soup.

T. Rowe Price, Temasek and Campbell's Soup are among the investors in a new round for Farmer's Business Network, agriculture's answer to Alibaba.

Founded by CEO Amol Deshpande, a former venture investor with Kleiner Perkins, FBN started as a kind of professional social network for farmers. It told CNBC it raised $110 million in this round of funding. (Google's venture arm GV was an early investor and participated in this round.)

Today, the company operates an online marketplace that helps farmers lock in fair prices on seeds, fertilizers and other costly "inputs" they use to grow healthy crops, as well as sell their crops to buyers.

On FBN, farmers can also share information, anonymously, about what's working in the field or not, and what they paid for various supplies. While they used to discuss these matters at old-fashioned barn raisers and other community meetings, FBN provides agronomists with connections to peers who aren't simply their neighbors.

Since it was founded in 2014, FBN has amassed a veritable gold mine of data on what farmers need and buy and which products have been most effective, whether they're generic or expensive name-brand products.

This now helps farmers avoid overspending. In the future, it will enable them to use FBN for data analytics online, in other words, software that can help them forecast more accurately and optimize their crops.

According to FBN's co-founder, VP of Product Charles Baron: "The ways in which farmers do business had not been touched by e-commerce and social networks like other consumer industries before. But their work is so full of risks from weather to commodities pricing."

Farmers and ranchers take home a measly 16 cents out of every dollar spent on food each year in the U.S., according to the American Farm Bureau Foundation — slim margins.

The funding round was led by T. Rowe Price Associates and Temasek. Earlier backers also re-upped their investments in FBN. They include: Acre Venture Partners, a fund that invests on behalf of Campbell Soup; Kleiner Perkins Caufield & Byers; GV (Google's venture arm); and DBL Partners.

The new investment brings FBN's total capital raised to about $195 million. Baron said FBN plans to use the money to expand geographically, and into livestock. A large percentage of farmers growing row crops in the U.S. are also ranchers. The company is working with some 5,000 growers today, and has 200 full-time employees.