California’s Central Valley is fertile ground for agtech experimentation
In 2019, Nathan Rosenberg was directing robots inside a 40-foot shipping container to grow crops. The Worcester Polytechnic Institute senior had co-founded a high-tech vertical farming startup — one of many betting on high-tech systems to grow crops in stacked layers, with tightly controlled light, humidity and nutrient levels. But a few years in, he realized the entire model was flawed.
“The sun is actually very efficient at growing stuff,” Rosenberg said. “And if you pay for the sun, it’s not a good business.”
Around the same time, investor frenzy surrounding agricultural technology was deflating. In 2021, investors poured $56 billion into agrifoodtech across the world, with nearly half into vertical farming and alternative protein startups. By 2022, that figure dropped to $34.4 billion; by 2023, $16.7 billion.
“They turned into dumpster fires overnight,” Walt Duflock, innovation director at Western Growers, a trade association representing family farmers, said. Those startups overpromised and underdelivered, he said, trying to do everything — automating, farming and distributing — while charging higher prices than traditionally-grown food.
Rosenberg, then based in the Boston area, drove three hours to Vermont to meet the most tech-savvy farmer he could find, and saw the real, tangible problems they were facing, one being how to monitor water usage and detect leaks as profit margins tightened. Today, his startup Farmblox develops accessible sensor systems that do just that, and more.
This pivot from speculative ambition to grounded problem-solving reflects a broader reckoning in agricultural robotics. After the collapse of flashy vertical farming ventures that burned through tens of billions in investment, a new generation of startups is emerging with a radically different ethos: solving real problems farmers face, and meeting them where they are.
And many are taking root not in Silicon Valley’s glass towers, but in the Sacramento-Davis corridor, close enough to the fields to get dirt on their boots.
The crisis driving tech adoption
The numbers paint a grim picture for California agriculture. From 2017 to 2022, the state lost over 300,000 acres of farmland, according to the 2022 Census of Agriculture. During the same period, the number of farms in California fell by 10%, while the average farm size grew by the same margin.
“It’s really hard now. [Smaller farms] need to get to scale to handle the state’s economics,” said Duflock.
Urban development and water shortages are major drivers of farmland loss. Between 2016 and 2040, California is projected to lose more cropland to urbanization than any other state — over 300,000 acres — according to a 2022 American Farmland Trust study.
Meanwhile, regulatory costs have climbed drastically. A case study of a large lettuce operation in the Salinas Valley found that compliance costs skyrocketed from $109 per acre in 1997 to $1,600 per acre today — driven by food safety rules, higher minimum wages and mandated healthcare.
There are few truly small farms left that are aiming to turn significant profits, according to Daniel Sumners, a professor of agricultural economics at UC Davis. The operations that can afford and benefit from agrobotics are mid-to-large farms that can secure loans for equipment purchases, he said. For these operations, the math often works: well-designed technology typically pays for itself within a single growing season through increased productivity.
Though urban expansion yields much-needed living space and increased wages and healthcare regulations improve worker conditions, many growers are struggling to stay afloat.
“The question is, what can stem the tide, what can reverse or stop the bleeding?” said Danny Bernstein, CEO of Reservoir Farms, an upcoming Salinas-based agtech incubator. “And the answer is, really, technology.”
New agtech mindsets
Across California’s Central Valley, a new generation of agrobotics founders is reshaping how innovation happens on the farm.
For Yang Fang, that means helping farmers leverage their equipment. Fang co-founded Beagle Tech in 2021 after working in autonomous vehicle development. Rather than reinventing the wheel — or the tractor — Beagle builds AI-powered attachments that work with growers’ existing hydraulic equipment.
The company aims to target the most physically punishing tasks, like pruning and harvesting, while preserving jobs farm workers enjoy. When their mechanization takes over repetitive cutting, crews shift to packing or tractor driving. And when it works, adoption is fast. A farm in Lodi started with Beagle Tech equipment on 20 acres, expanded to 100 and now uses their technology across all 500 acres.
“Farmers know their numbers,” Fang said. “Once they see it works, they’re going to increase dramatically.”
Tyler Niday, CEO and co-founder of Bonsai Robotics, is tackling the same problem from a different angle by rethinking what farm machines look like in the first place. Instead of designing around a human operator, Bonsai builds autonomous systems that can navigate orchards and vineyards using computer vision, even in dusty or GPS-limited conditions. One of Bonsai’s tree shakers, for example, can move in continuous motion from tree to tree, doubling harvest speed by eliminating the need to pause.
Founded in 2022, Bonsai made headlines earlier this year for raising $15 million in their latest funding round. It recently acquired farm-ng — a startup known for its modular, open-architecture robot platforms — to help extend their software-driven vision to a broader range of crops and geographies.
But for Niday, the focus remains the same: solving real problems in the field and lightening the load for workers. “A grower is the expert at their craft, right? They live and breathe the farm life every day.”
Succeeding in agtech requires “understanding a world that most people never see,” Rosenberg, founder of Farmblox, said. Farmblox develops a centralized app and sensors that lets farmers monitor soil, irrigation lines, water levels and more. Since their inception in 2022, they’ve deployed over 5,000 monitors across the country.
When first testing prototypes for their sensors and controllers, they encountered water that snuck under equipment and froze, breaking them. He once received a call from a farmer who told him that the wires Farmblox had provided him snapped in his bare hands. “He had just pulled it apart.”
The work requires designing for extreme, unexpected conditions and glove-wearing farmers. “Let’s make it so it’s the easiest thing in the world to install,” he remembered thinking. Even growers without smartphones have been able to navigate Farmblox’s platform, he said.
Tight margins and automation worries
Even as new startups focusing on practical solutions yield promising results, funding remains tight. This year, the agrifoodtech industry is set to see $10.2 billion in funding — just 19% of the capital invested five years earlier. And farm robotics only make up 5% of the deals being made; the rest are split up in sectors such as biotech, bioenergy and post-harvest technologies, according to the AgFunder 2025 Global AgriFoodTech Investment Report.
Recently, several high-performing robotics companies have stumbled. Sacramento county-based California Safe Soil, which held 41 patents and made fertilizer from expired supermarket food, shut down in May. Advanced.farm, a startup developing robotic apple pickers in Davis, was acquired by CNH Industrial in April. That same month, Santa Clara-based Farmwise, which raised $50 million to build fully autonomous weeding platforms, had to wind down operations and was soon acquired by Taylor Farms.
The acquisitions of Farmwise and advanced.farm yielded partial returns for investors — a decent outcome for the agrobotics ecosystem, Duflock said, as some capital was recycled into the sector — but they also marked the end of independent growth. In each case, the technology worked. What was missing was the funding to scale.
Still, if and when automation does scale, its impact on farm labor will depend on how it’s deployed. Historically, successful mechanization has tended to be largely labor-augmenting, said James Sayre, an assistant professor of agricultural economics at UC Davis. When farmers buy tech, their workers become more productive, and wages often rise alongside output, he said. The nature of agricultural work may shift with mechanization, too, as workers move to higher skilled roles or shift to other sectors.
And the potential for automation varies widely by crop. Row and tree crops like almonds, tomatoes and olives have proved relatively automatable. Delicate specialty crops like strawberries remain far more resistant, requiring human dexterity and judgment that machines can’t yet replicate.
For now, most technologies aren’t widespread enough to disrupt labor, said Antonio De Loera-Brust, a representative for United Farm Workers who regularly speaks with laborers across the country. But if that day comes, he said, farm workers will need a seat at the table.
“Technology is morally neutral, right? The same technology that could help workers shift to safer, less physically demanding work is the same technology that could just lead to widespread reductions in farmworker jobs,” he said.
Building an ecosystem in Sacramento
Despite funding concerns, startups remain optimistic that they’re on the verge of an up-cycle. As mainstream adoption of AI accelerates, farmers are becoming more receptive to technology, several founders described. Land constraints aren’t going away, building and querying AI models is becoming cheaper and technologies continue to innovate.
After years of driving hours or flying cross-country for every product test, Rosenberg is relocating Farmblox from the East Coast to California’s Central Valley. “That’s where the real farms are. And that’s where, really, our future is,” Rosenberg said.
The greater Sacramento region offers a compelling launchpad: lower costs than the Bay Area and access to the nearby farmland and agricultural talent from UC Davis, said Cameron Law, executive director of the Carlsen Center for Innovation and Entrepreneurship at Sacramento State. Those students just need to be convinced to stay in the area and be given the resources and support needed. That’s where the Carlsen Center and the newly-launched Aggie Square innovation campus at UC Davis come in.
Still, some in the industry hesitate to say Sacramento can become a true tech hub. For Danny Bernstein, who used to work at Google and Microsoft, the answer depends on what kind of tech.
“Smart capital will find great entrepreneurs regardless of where they are,” Bernstein said. Sacramento just needs to find its niche, he believes, and build the infrastructure to support it.
After consistently meeting agtech founders in the Bay Area who were developing farm solutions but had never stepped foot on one, Bernstein began work in 2023 to launch Reservoir Farms, California’s first on-farm agtech incubator, based in Salinas, which will house around a dozen agrobotics startups, providing them with access to test plots and mentorship.
A common assumption about agtech is that it operates on a slower cycle than consumer or enterprise tech, Bernstein said. He disagrees: most startups aren’t optimizing enough and aren’t as close to farmers or as on top of crop cycles as they can be. Reservoir Farms aims to expedite these startups’ trajectories, to bridge the gap between Silicon Valley speed and agricultural reality.
“You have to chase the crop, test year round,” Bernstein said. “The question is, will they accelerate? Will they take the necessary steps to accelerate? Will they go all in?”
Some companies are finding alternative funding sources, with Rosenberg reporting that Farmblox has been seeing interest from general investors who view agtech as a long-term play. And when it comes to attracting talent, Rosenberg hasn’t had trouble convincing people to join. “Who doesn’t want to be on a farm?”
Startup funding is never a sure bet, but what’s happening now is a gestalt shift in how innovation reaches the field. Where many startups once sought to reinvent agriculture wholesale, these founders are listening to farmers, adapting to the rhythms of harvests and building tools that fit the rows instead of rewriting them.
This story was originally published August 5, 2025 at 5:00 AM with the headline "California’s Central Valley is fertile ground for agtech experimentation."
CORRECTION: Daniel Sumner is a professor of agricultural economics at UC Davis. His last name was misspelled in an earlier version of the story. Reservoir Farms is an agtech incubator based in Salinas. An earlier version of the story listed the location of the incubator incorrectly.
