Monashees Invests in Tarken: Grain Trading Startup

Tarken Secures Seed Funding to Revolutionize Brazilian Grain Trading

Tarken, a Brazilian grain trading marketplace, has successfully raised $3.5 million in a seed funding round. The investment was co-led by prominent venture capital firms Monashees and Maya, and will be used to further develop the company’s technology platform.

Investor Participation

The funding round also saw participation from Gilgamesh Ventures, alongside several individual investors. These include Carlos Garcia, founder of Kavak, Pierpaolo Barbieri, founder of Ualá, Brian Requarth of Zap VivaReal Group, and Gokul Rajaram from DoorDash.

Founding and Origins

Luiz Tângari and Carlos Neto established Tarken earlier this year. Their collaboration began eight years prior at Strider, a crop protection systems company which they co-founded and subsequently sold to Syngenta in 2018.

Following the integration of Strider, the founders initiated Tarken, initially concentrating on the corn market, estimated by Tângari to be valued at $30 billion. Brazil’s National Supply Company (CONAB), under the Brazilian Ministry of Agriculture, projected corn production for the 2020-21 growing season at 102.6 million metric tons.

Addressing Illiquidity in Commodity Trading

“A significant challenge within commodity trading lies in its inherent lack of liquidity,” Tângari explained. “Farmers cultivating corn and soybeans often face a dilemma: sell quickly at a reduced price, or endure weeks of waiting for favorable market conditions.”

He highlighted that price transparency was achieved in the United States a decade ago. To replicate this clarity in Brazilian grain trading, Tarken developed an artificial intelligence (AI) tool. This tool aggregates data from diverse sources to establish a price for each Brazilian city, a previously unavailable insight.

Platform Functionality and Risk Reduction

The platform allows both buyers and sellers to explore a map displaying available products, prices, and associated freight costs. Farmers can directly communicate with sellers and vetted freight operators, facilitating transactions directly through the platform. This streamlined process, according to Tângari, “effectively eliminates risk.”

Previously, a transaction cycle spanning approximately 12 weeks – encompassing price discovery, negotiation, and product delivery – can now be completed in a matter of days.

Empowering Market Participants

“This platform, coupled with educational resources, provides tools for developing and evaluating buying and selling strategies,” Tângari added. “Currently, farmers lack adequate support, and we aim to rectify this. Our goal is to empower market participants with greater intelligence, reduced price volatility, and improved liquidity. Success in this endeavor could lead to a 3% decrease in chicken prices for consumers.”

Growth and Future Plans

Since its launch four months ago, Tarken has facilitated over 1,000 negotiations and currently maintains several hundred open bids. The number of negotiations is experiencing a daily growth rate of 50%, and Tângari anticipates reaching 10,000 registered customers by year-end.

The newly acquired funding will be allocated equally between engineering – to continue refining the product and finalizing the AI tool – and marketing, focused on attracting new customers and providing educational content.

Tângari also indicated that Tarken is preparing to initiate a Series A funding round within the next six months.

Investor Confidence

Marcelo Lima, partner at Monashees, stated that his prior experience with Tângari and Neto through their investment in Strider informed his decision to back Tarken. He emphasized the company’s innovative approach to the agricultural commodities market, which has seen limited innovation recently.

“We are confident in the power of technology and data to consolidate supply and demand, enhance user experience, and establish a leading marketplace in the region,” Lima said. “We are at an opportune moment, and we have the ideal team to spearhead this transformation within agribusiness.”