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Understory, a Madison, Wisconsin-based weather analytics company, announced today that it has raised $7.5 million in new funding. The round is led by local venture capital firm 4490 Ventures, an existing investor in the company. Revolution’s Rise of the Rest Seed Fund also joined the round. Other existing investors in Understory include Monsanto Growth Ventures and Silicon Valley-based True Ventures.
Founded in 2012, Understory has raised more than $16 million in total. Cofounders Alex Kubicek and Bryan Dow started the company in Madison, before decamping for Boston after being accepted to an accelerator program there and then moving back to Wisconsin after receiving an investment from 4490 Ventures.
Understory has developed weather stations that can be installed on the roof of a building or in a field to monitor hail, wind, rain, temperature, pressure, and humidity in real time and distinguish between each type of condition. The station is equipped with sensors and a stainless steel ball at the top. Understory claims that the stations can last for up to 10 years without maintenance, and can withstand up to an F2-class tornado.
The company sells its data to farmers and agriculture companies who can use it to tell on a more granular level, for example, how much it rained so they can plan their crop maintenance accordingly, as well as to insurance companies, which can use Understory’s damage estimates to inform their underwriting. Kubicek, in a phone interview with VentureBeat, declined to give specifics on how many customers the company has.
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Historically, companies have had to rely on weather data collected by satellites. Understory purports that its “on the ground” approach is more accurate than the “in the sky” approach. In the case of insurance companies, Kubicek said that satellite data has historically been “overly aggressive” in trying to estimate where hail hit. That means that insurance companies will send contractors out to more areas than needed to look for hail damage, and in turn those contractors may end up repairing more roofs than needed.
One of Understory’s most notable moves this year came in the form of a partnership with Monsanto (which recently merged with German agriculture giant Bayer) to install its stations in some of Monsanto’s fields in Argentina. In a press release announcing the partnership, the lead on Monsanto’s global supply chain field optimization team said that “Understory provides the only technology necessary to make hyper-local weather valuable for operations management in agricultural areas where local weather information is not accurate.”
“When you talk to a farmer in Argentina, and they open up their phone and show you the AccuWeather app — the temperature is usually 10 or 15 or 20 degrees off from where you are,” Kubicek said. He told VentureBeat that Understory is in talks with Monsanto to expand its partnership to more countries, but declined to give specifics.
Understory has deployed more than 500 stations in five cities: Houston, Dallas, Kansas City, St. Louis, and Denver, and hopes to expand nationally and increase the number of stations installed to 5,000 by the end of 2019. Understory’s sensors are installed on private property like commercial buildings, schools, and churches, free of charge. That’s one of the drawbacks of Understory’s on-the-ground approach, particularly in urban areas — it can only expand so quickly, because it has to go door-to-door to get the building owners’ approval to install sensors.
Kubicek said that Understory currently has about 15 full-time employees, and hopes to double that over the next year. That’s one of the reasons why Kubicek said that they brought on Rise of the Rest as an investor, as the firm has a mission to help connect regional talent to startups in places like Madison.
“We believe [Revolution] can help us find talent in the Midwest, where you know traditionally people see the Midwest as not being a great source of talent. But with Revolution’s network, we’re pretty excited that we’ll be able to pull in some fantastic talent that will help us scale,” Kubicek told VentureBeat.
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