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John: Welcome to another edition of the Impact Podcast. This is a very special edition because we’re so lucky to have with us today, Carlo Mondavi. He’s the Chief Farming Officer of Monarch Tractor. Welcome to the Impact Podcast, Carlo.

Carlo Mondavi: Thank you, John. It’s a pleasure to be here with you. Thanks for having me.

John: You know Carlo, we have so much to talk about and all the great things you and your colleagues are doing at Monarch Tractor, but before we get into it, obviously you come from an iconic and famous family name, it was a 4th generation wine grower. Talk a little bit about your family, your journey growing up and how you got on this fascinating and very important journey of the creation and launch of Monarch Tractor.

Carlo: Thanks John. It’s a pleasure to be here and I never thought in a million years that I would be a co-founder in a technology company, let alone an electric driver optional tractor. I’m a farmer and a winemaker first. My family has been now making wine for 4 generations in California. We came through Italy. We immigrated around 1906 through Ellis Island and it’s been interesting because my family is kind of had these little waves. We started in Virginia, Minnesota. My great-grandparents basically had 2 dollars to their name. It took a 1-way ticket to Virginia, Minnesota to work in the iron ore mines. My great-grandfather, his brother Giovani was killed tragically in a mining collapse. My great-grandfather was [inaudible] was like this is not why I came to America.

John: Oh my gosh.

Carlo: He went above ground and we began a saloon in a boarding house that kind of fed and my great-grandmother was an incredible cook, fed and kept warm all the miners and then prohibition hit and our saloon that was attached to the boarding house was put out of business. I think that the local town felt so bad for my great-grandfather that they entrusted him with their cold hard cash. There was this beautiful loop hill and prohibition which was 1933 and a loophole was that the government was not willing to go against the church and they were not willing to go against medicine.

During prohibition everyone became very religious and began doing wines for the sacrament, of course and my family moved to California away from Virginia, Minnesota, is the same town where Bob Dylan’s from; beautiful little town. But we moved to California. We began sourcing grapes and shipping them out to all the different families that were interested in making wine. An interesting statistic or number is that during prohibition, the consumption of wine in the United States doubled. Upon repeal in 33, the shipping business was put out of business again in a weird way, serendipitous, of course, and we got into making and bottling wine.

In 1943, my grandfather Robert, my great grandfather and my great-uncle, Peter bought Charles Krug. Basically, in sixty two, my grandfather, Robert went on a trip to Bordeaux to Burgundy, he visited the Braun cruise and the first growths and he asked the wineries, “What are you doing in the Vineyards? What are you doing in the cellar?” They said, “Robert, we’ll tell you everything. Just don’t tell our neighbors.” They were like, “Who’s this guy from California?” That gave him this fire in his belly. He came back from this trip and say, we have the soil, we have the climate, we have the know-how to make wines and could sit in the company of the great wines of the world.

We just have to invest in the vineyards, invest in the cellar. He came back, that came at a cost that my family was not willing to make at the time. In 65, my grandfather Robert was asked to leave Charles Krug. In 66 he began Robert Mondavi Winery, with that goal, to prove that we can make wines, we could sit in the company of the great wines of the world. In 1979, a bit of this was realized when Baron Philippe de Rothschild then my grandfather founded Opus One as a joint venture in Napa Valley. We got a little bit over our skis in the nineties when we were having challenges with phylloxera, and we needed to replant so we decided to go public and in 2004 my family sold Robert Mondavi Winery. 2005, my grandfather Robert, my father Tim and my aunt, Marcy began Continuum estate, which is a single wine from a single site at the very highest level in Napa Valley.

In 2013, I began Rain with my brother Dante, which is a peanut project on the True Sonoma Coast. Finally, I had gone to college in France. I’d worked in Burgundy. I’m crazy about Pinot Noir. I love the wines coming from the True Sonoma Coast. They are exceptional. Dante and I began that and then along my journey in farming and making wines, I began seeing that the more and more that I would go look at vineyards, then more and more I started seeing this really weird strip spray, underneath the vines. I remember just being like, “What in the world?” It was this beautiful green grass in the in-row and then there’ll be this basically dirt and sometimes there would be moss there.

I was like, “What in the world is this?” I remember talking to my father because the vineyard after we had sold Robert Mondavi and the farming baton went from my family to the new company, they began using this chemical called a herbicide. There’s 3 essential pesticides in agriculture. There’s insecticides which deal with insects. There’s fungicides which deal with fungus like mushroomy type things that kind of create cloudy. They grow, if you have a garden and you haven’t taken care of the fruit zone or been on top of your farming, you’ll start to see this moldy stuff, that’s fungicides. And then the 3rd is a more recent chemical which is called a herbicide and herbicide, when you think of pesticides, the side part, it’s no different than homicide or genocide. It’s basically to kill and so what that’s targeting herbicides is targeting grasses.

And it’s a chemical literally to mow. I began seeing these chemicals being used to mow more and more and more in Vineyards and I was kind of shocked. First thing I remember talking to my father and I went outside and I said, “Dad, what in the world is this because it’s beautiful.” It’s typically sprayed in February kind of as the grasses are awakening and growing and spring is upon us and they kind of go out and they spray the herbicide, which is round up with a cocktail with a pre-emergent which kills the seed bed.

I remember going to my father and being like. “What in the world is this?” And he said, “Well, they’re chemically mowing.” He said this is something my family, I’m very proud, 4 generations of not using herbicides and essentially organic and so long story short, I began doing research because I was always like 1st off, why would you spray a chemical by the root ball of the vine. Wouldn’t it hurt the vine? 2nd off, there was a vineyard in particular that separated my father and my grandfather’s home and at the bottom of that vineyard there is a well and that well is where my family got her drinking water from. I thinking to myself, you’re spraying all this chemical on this hillside.

It’s going to end up in that water table. We’re going to end up drinking it, so let’s understand what we’re drinking. I linked up with Dr. Stephanie Seneff, she’s an incredible senior researcher at MIT. I linked up with a colleague of hers from Harvard. I learned about the environmental impact and I learned about the human health impact and I began a movement called the Monarch Challenge and the Monarch challenge … sorry, John is like the long story that happened.

John: I love it. No don’t be sorry. This is awesome.

Carlo: How I got to Monarch. But I began this challenge named, I guess I should say the tractor is named after the challenge in a way and after this beautiful butterfly, the westerly monarch butterfly is this butterfly, it’s orange and these little white dots and black and they migrate. They have a longest invertebrate migration on our planet. They migrated to Canada through Washington, Oregon down into Mexico and overwinter along the coast in California. And I remember it hit me like a ton of bricks because I read that since the introduction of Glyphosate Roundup, so Roundup is the original form. Now the patent expired, I should say, in 2001.

Now the largest producer of glyphosate is China, so it’s global. It’s massive. Of the 9 billion pounds of pesticides, 2 billion are fungicides, 2 billion are insecticide and 5 billion are herbicides, which is crazy and that’s spread into our food ecosystem. But I learned since the introduction of this not that long ago that the monarch population of butterflies has declined by 99%. They’re now on the brink of extinction. They were recently put on the endangered species list and they’re indicator species.

Indicator species indicate if we can protect like the wolves of Yellowstone or planets indicator species in different ecosystems, we can protect entire ecosystems underneath them that thrive with their protection and their success. Here’s a kind of indication, this is a study out of Germany that has indicated that 70% of our planet’s insect biomass has disappeared since the year 2000 and with it 50% of the bird population. This is in just 23 years, which is crazy. I begin this movement about creating awareness within my farming community called the Monarch Challenge because any change that any farmer has in their kind of way of doing things is challenging.

It’s uncomfortable, it’s different. I call it a challenge because it was a challenge for us to migrate away from herbicides, one of the uses that many farmers use. I quickly learned and going and talking with farmers that there was an economic divide so that it costs more for a farmer to go without herbicides, which is crazy, because that’s an input you’re buying. I learned that 43% of farms in America are profitable, meaning that 57% of the farms in America are struggling. 43% profitable. I learned that there was this economic divide and it cost more and that when you look at what’s happening with climate change that it’s even more difficult to farm. We have more difficult vintages and more difficult challenging years where we have crop losses and as a result, that economic challenge is ever more.

There was economic divide and then I would talk to large farms that were a scale, like the company that bought my family’s winery and they would say, “Look we agree. We don’t like these chemicals, but we have shareholders to report to and if we’re going to go out and drive our tractor more, there’s a labor challenge, there’s a labor crisis right now, which is hard, labor safety is paramount. But the big thing is that when we drive our tractor more were burning more diesel.” Think about herbicides you can go and depending on the rainy season of where your farm and you spray it once a year, maybe twice a year and you’re done for the year and think about mowing as kind of its rain dependent.

If it rains a lot, you got to go out and mow your grass lot. It’s the same on a farm. You can mow in your field during the growing season like in Piemonte, where it rains often, almost weekly, like ten times a year. In California, you can time it because we have very little rain during that growing season between basically spring and fall with very little rain. If you time it, you can probably get away with 1 or 2 passes depending. Like 2023 was tough. We got a lot of rain, so that would be different but most seasons you can get away with 1 or 2 passes. But you still have to make more passes typically and that means burning more diesel and that means there’s a greater carbon footprint, and in some instances that carbon footprint divide is really, really big because turning on a tractor the size of Monarch is like turning on fourteen cars and it’s knocks particular and CO2. It’s this huge just plume of energy being burnt and polluting our climate.

I learned about the carbon footprint divide and because of those 2 reasons the way that farming is today or was before Monarch Tractor was the bar challenge was going to fail. It was unattainable for us as farmers to ask or for us to ask farmers to go without these chemicals. That was when I realized that if we are going to succeed as a planet and as humanity, we have to find a way to make what’s best for our planet economically superior to anything else. Mother earth needs to come number 1 because mother earth is what we derive human health from and a healthy earth means healthy people. I got the introduction of a lifetime. This all was by the way 2016, I began the Monarch Challenge. 2017, the wildfires burnt up to my family’s winery. We were incredibly lucky. We lost only 30% of our crop. We kept our winery and we kept our homes but a lot of my friends lost their homes, some of my friends lost their wineries and some of my friends lost a hundred percent of their crop with all that too.

Then, you think that’s the 1 in fifty-year storm, that’s the one storm of your lifetime as tragic. A lot of people lost their life in that fire. In 2020, the wildfires came ripping back and burnt over some of the same past they had burnt before, ravaged, caused crazy damage and in between that 2019 and 2018 there were iconic fires in California. It was one of those realizations that we have to put climate and biodiversity at the same exact kind of we have to protect our planet’s biodiversity and we have to protect our planet’s climate and they are 2 and 1 in the same. They work together to thrive as we deforest our planets woodlands and meadows and forests and we hurt the ocean.

We’re seeing this collapse of biodiversity, which is really, really, really scary. Anyways, long story short, I got an introduction of a lifetime to my 3 brilliant co-founders. I’m the non-technical founder. I’m a farmer and a winemaker. I become quite technical but my co-founders are brilliant engineers out of Silicon Valley. One of them Mark Schwager helped basically Elon build and scale Tesla, Praveen Penmetsa, who’s our CEO, is a brilliant engineer and a brilliant CEO. He has a master’s in engineering but he’s incredibly dynamic as a CEO and just an inspiration to be in the room with, and then Dr. Zachary Omohundro, is our CTO and one of our 4th co-founders and he has his PhD in robotics from Carnegie Mellon and a master’s in electrical engineering.

Just a really genius team and we were able to attract I think some of the most brilliant engineers that have worked on some of the most difficult aerospace, on road, kind of agricultural technology challenges that currently exists and we all came together and we began Monarch. Monarch Tractors is electric tractor, so we bridge the carbon footprint divide and its autonomous. Autonomy is a massive piece and we can dive into the autonomy piece if you want, but the autonomy allows us to not just deal with the labor shortage and the human safety side, which is important, but also deal with the massive pesticide and fertilizer kind of side, the chemical side of farming which is a big, ugly thing that we need to fix and that we’re in the center of fixing. It’s the carbon footprint and these whole massive chemical things. Sorry I’ve gone on it. That’s how I got where we are today and it’s been exciting.

John: That’s awesome and for our listeners and viewers, we’ve got Carlo Mondavi with us today. He’s the Chief Farming Officer at Monarch Tractor. To find Monarch Tractor go to www.monarchtractor.com. I’m on your site now and not only do I love the site because how informational it is, but I love right on the landing page, the autonomous tractor is right there and It’s a sight to see. I encourage everybody to just pull it up right now, check out the website and check out this autonomous tractor and man, I want to get into it more. Now when were you introduced to the other 3 partners and when did you come together as a group with this singular mission?

Carlo: That was back in 2018 and Parveen and Zachary had been working on a tractor project before back. There’s a USAID grant that they took or they won, they were awarded, and they built this electric tractor, but it was before the commoditization of all of the computing and basically the autonomy sweeps of what we have. The vision and all that stuff was still too expensive, so wouldn’t really make sense for the cost for farmers. But when Tesla kind of started putting cameras and computing in all their cars and everyone started doing this, the cost came down significantly. Meaning that we could now make a tractor that the farming community could afford and put to use. That was when Praveen and Zachary talk to Mark and then we got connected through a mutual friend and we were off to the races.

John: I love always entrepreneurial Journey. Were you all California-based at that time?

Carlo: Praveen and Zachary were down in Southern California operating this Black Ops on the edge technology solution company. They were doing stuff for all sorts of cool aerospace projects and on road called Motivo, which actually helped incubate our tractor in the beginning days. Mark was flying around the world. He had been Zoox, obviously Tesla, then Zoox, Romeo Power. He helped the founders of Northvolt, which is the greenest gigafactory in the world in Sweden. He’d been doing a lot of consulting and so we were all basically basing out of California.

John: Talk a little bit about ground zero, in a room, envisioning this together and starting to draw it up and then how long does it take from advent to the time that you actually had a beta model to test?

Carlo: We had a beta model which was the electric, we call it the alpha. We had the alpha tractor, which was the USAID electric tractor that we ended up taking and putting on top of that all the autonomy technology. We were doing that basically with duct tape and plywood. We took the learnings from that and we built our beta tractor and that was within twelve months. We built two betas, we went out and tested them and we learned. Actually, we launched that in 2020. We had had it out and we did the big launch, was right as covid was down.

It was like a viral virtual kind of launch that I always say it went farm viral because we got orders from like ninety-nine countries around the world and it was this crazy awakening of what farming could be and a very exciting time. Then we built like twenty-five of our pilot series trackers. We followed the kind of aerospace like alpha, beta, pilot and then design validation and production. Our mark 5, our 5th which is the production tractor that you see behind, we just launched that this last year. Now we’ve been in the market for about twelve months now with our first tractor.

John: Tell us how that’s going and obviously, we know it’s electric, so we know no emissions and all that kind. What are the impacts that this 5, this Monarch 5 tractor has to both the environment, the people, the whole ecosystem?

Carlo: It’s been an incredible year for us. It’s slow. We’re lifting off slow, we’re gaining momentum and just growing and growing and growing, and so this first year we launched in the magnitude of hundreds of tractors. We were able to touch over 25,000 acres of farmland. We were able to offset over is like 18,000 gallons of fuel from being burnt. We saved farmers around 200,000 dollars and that was our first year, so that’s all spending up. This growing season also for California, which is where we launched was very rainy and very wet.

The spring we didn’t get started until late. This next year, I’m really excited because as we begin to wake up in the spring and all of our tractors begin to be used … right now it’s still being used for seeding and some for feed pushing and some other things that are kind of continuous, they don’t have like these seasonal ups and downs. But in the perennial and annual crops, everything’s fairly quiet now as we’re in the winter months and then in spring when it starts to jump up and as we really begin to scale our business, the impact is going to be even bigger. I’m really looking forward to the numbers that we’re going to see this year. Pardon me, I want to correct that. I think I said it’s 18,000 hours of operation and it was in the magnitude of 40,000 gallons of fuel. Sorry.

John: Wow. That’s great. How many tractors you have out right now, approximately, a couple hundred?

Carlo: Hundreds. It’s closer to about five hundred trackers.

John: That’s great. And what’s your projection or what’s your hope and your projection for next year?

Carlo: This year we’re going to jump into the thousands without getting like too granular on the numbers. But we’ll be in the magnitude of thousands of tractors.

John: Around the world, not just California, not just US. This is around the world sales.

Carlo: This year we will be focusing our sales in the United States to meet the demand in the US. We do have 2 tractors that just landed in Europe. We just came back from Agritechnica which is the world’s largest agricultural fair, which is incredible. My mind was blown to just how many different interesting companies that I had never seen before. I’m used to seeing your New Holland’s and your Cases and you’re John Deere’s and Kubotas. There were so many other companies. It was crazy. And then we went to CTD in France and we’re beginning the tour of generating the energy and interest in Europe right now, which is I think going to be an even bigger market than the United States.

There’s just more political subsidies there. There’s more of that desire to make that transition faster. There’s a lot more renewable resources and clean energy and some, like Italy obviously suffers a lot because it’s a large amount emits coal power. But there’s a large desire to go and migrate away from that fossil fuel just because when you think about where most of Europe derives their power from, it’s coming from Russia. And with this Russia-Ukraine war and lack of energy independence, I think Europe said wow, if we can become renewably powered then we can control our own grid. Some combination may be of mutual, France is doing with renewable resources, then we can become independent on an energy basis from basically the fossil fuel era of our lifetime. It’s exciting what’s happening in Europe. We have a tractor, incredible NZ0, New Zealand is a fun, we’re going to be launching in New Zealand. This is all towards the end of 2024 is when will be going global but we are in terms of creating energy and interest in terms of building the market, we’re doing that right now.

John: Carlo, is Monarch the market movers? Are you the first brand to hit the market that’s electric tractor?

Carlo: Yeah, we are the world’s first electric driver optional tractor. We are also ahead of anything in on-road. We are the world’s first commercially available autonomous vehicle. We’ve leap frogged the whole on-road movement on autonomy. You can buy our tractor right now, get in it, drive it like you would drive in normal tractor, except it’s an EV so it’s smoother in terms of just off the 02 moving very smooth transition of energy. Then on top of that on the back, you have the same kind of hookups that you would see on your typical diesel tractor, which is a 3 point hitch; your PTO, your power take-off and your hydraulic pump which are the things that basically manage, run and power your implements.

It can reverse fit into any farm’s current implement yard. Then through the by wire software-driven frame of the tractor, you can control all of those implements either manually or you can automate them. Not only is the driving and propulsion of the tractor able to be done autonomously but also the operations of what you hook up behind it and slowly but surely, we’re unlocking those. We just unlocked mowing for farms autonomously. We’ve just unlocked under the vine weeding. This also isn’t just for vineyards, it’s blueberries and apples and different orchards, different fruits and vegetables, also livestock like when you look at the whole side with dairy and feed pushing.

The other side of this which is massive is the energy play. A typical tractor sits for about two hundred and sixty five days of the year. Farms use them about a hundred days of the year intensely and then they’re parked. When you look at our tractor, ten of our tractors is greater than a megawatt hour of energy, which is like a megawatt hour of energy is essentially able to power a thousand homes for 1 hour or able to power 1 home for over a month. If you look at that, it’s a micro grid. You’re able to literally go to the off-grid era farming but you’re also able to power the grid on the edge. Most farm lands are far away from hospitals and far away from the city center is where the grid is always set to be on and they never want to turn the grid off. The first areas that typically get shut down when there’s power needs elsewhere are the farming communities.

And so now we’re able to as farmers go from the fossil fuel era of power in our farms to the era of capturing the renewable energy on our farm; so wind, geothermal, solar, hydro, whatever capturing that, harnessing and storing it in these batteries and then deploying it to the farm where is needed when is needed or back to the grid to help be a buffer for some of these challenges and farmers can literally get into the energy business whether it’s just the energy business of their farm or the energy business of their farm plus power in the grid. There’s kind of a new exciting era that this type of technology that Monarch is unlocking which is exciting.

John: Is there a cost differential between your Monarch 5 and the Legacy type of tractor that still emits all those emissions and uses fossil fuels?

Carlo: There definitely is. Our trackers eighty nine thousand dollars and when you look at this is with like all of this and there is a subscription for autonomy, like turn on autonomy and some of those things, there’s a monthly fee. When you look at a normal diesel tractor, they’re like in the forty thousand dollar range, but that’s for like a tractor that very few farms that I know buy. For example, on my family’s farm it’s replaced the ninety five thousand dollar tractor. We’re in the realm. Mark who he’s built over eighteen million square feet of factory space. He said if I can build, once upon a time in his days at Tesla, if we can build a Tesla in a magnitude of fifty thousand dollars, then we can build a tractor for a price that’s affordable.

John: And the goal was to be the Tesla of the tractor industry, the leading brand?

Carlo: We definitely, we want to be the leaders on the technology side. We want to help this revolution happen as quickly as possible. One of the things that my co-founders were really smart to do and saw an opportunity for us to scale our impact faster was to license our technology to larger OEMs that can scale the business faster. What we’ve done is we did a partnership with CNHI and that’s they’re the 2nd largest tractor company in the world and with the largest distribution network globally. They’re tied with basically or John Deere. They’re tied with distribution-wise; John Deere and they are 2nd behind John Deere, I think in scale.

They have essentially licensed our technology and electrification peace and on parts of the autonomy piece for a much larger tractor that’s non-competitive to Monarch so that we’re not competing against each other or cannibalizing each other’s markets, but this allows us to scale much faster. Help them scale this movement faster. It’s a really cool partnership and we’re doing that as well going forward. We look at it kind of like you would maybe think of open-source, but it’s more like hey, let’s license our technology to as many of these really great companies and scale our business as fast as possible and help us reach achieve impact goals faster as a farming community. As the founding team and the whole entire team, I think why people left aerospace and why people left on-road which can be very sexy and depending on how you look at it and joined agriculture and joined Monarch is because of the impact that we can drive, which is incredibly massive.

John: Instead of just going just for the profit which I know of course any company to be sustainable has to make a profit, you’re also going it by doing these licensing deals, you’re going for the greater good holistically speaking, so you can change the world to make the bigger impact faster?

Carlo: Correct. Exactly.

John: Love it. That’s great. Talk a little bit without giving away proprietary information or specifics, what percentage or generally speaking how much of the group of your initial round of buyers opted in for the automation option?

Carlo: That’s a good question. I want to say initially, we’re like 30% took the 1st year by I think that that’s going to grow as autonomy has proven more and more robust. Right now, we’re very focused on 10% degree slope or less, your twenty-five-foot turnarounds and all these things that make for an automatable field that is just going to make for us to have low-hanging, smooth easy fruit like in the beginning. Over time, I think that it’s if we can drive it as a farmer, we can also automate it.

That’s the longball but we’re going to crawl then walk then run. We’re still, I would say, in the transitioning from crawling to this next year, we’ll be walking as we open up automation to more operations, and we open up automation to more environments. But right now, roughly thirty percent and again that number will grow. Automation honestly, think about the tractor when you’re able to automate mowing as a Roomba. You’re able to basically go up and down and cut the grasses when you need to whenever without having to incur the time, without having to incur the cost or the diesel both in labor and in fuel. There’s a labor shortage in the United States right now and this is a global thing.

It’s crazy. If you look at anywhere around the world, there’s a massive shortage. To give you kind of a rough idea of the numbers, about 50% of Americans were farming in 1900 and in just 123 years later, it’s about 1.8 percent. This exodus has come at a heavy burden in terms of what we’ve been able to do and what is replaced our labor and our people haves been more and more chemicals. This is where I think automation is so massive. 1st, yes, you are able to address the labor shortage. 2nd, the most dangerous place on a farm is in the tractor seat.

I love driving tractors. It’s fun. But when you’re going up and down up and down up and down, it’s really, really tough and sometimes operator errors can be not great and tractors. They’re not meant to go off course, if you know what I mean, they’re really meant to stick in the road, turn around and … Mitigating and even when you’re spraying with the hazmat suit on it’s still not ideal. We’re able to remove hazmat suits and really protect our farmers. But the 3rd one is the removal of chemicals. When you think about the 5 billion pounds of herbicides, we’re able to have a hundred percent reduction simply by mowing. By mowing, it’s like you cut the grass instead of spraying a chemical.

John: So great.

Carlo: And so that’s a big piece helping our water table and our planet, our soil microbiome and our farm biology. Right now, when we spray fungicides and insecticides which are typically sprayed from the dirt, up into the canopy and in the fruit zone. When you put an operator in, you go very fast you try to blanket your field to cover as many linear feet of fruiting as you can in an hour. By being able to automate this, we’re about 95% inefficient. Meaning 5% of the fungicides and insecticides sprayed hit the target of where they’re supposed to be. Think about that. A lot drips off, a lot goes off into the ether. When we’re able to slow down and automate, think if we can just go from 5% to 30% efficient. It’s a huge number.

We’re looking at huge savings there as well. And just to talk a little bit about what this means to our planet and what it means to the deeper meaning, I always hear when people talk about different beers or different beverages or different foods with glyphosate in them, I’m always like well, what do you think your water has in it, right? Most water has it in because of how much of these chemicals are being sprayed. When you think about spraying these chemicals onto the soils, it affects our organic matter in our soils and organic matter is bacteria and fungi and all of this life, this mycelium and mycorrhizal network that really helps nourish the plants.

There’s a symbiotic relationship between the mycorrhizal fungi and the roots of the plants that help the plants breakdown and take up nutrients and when you spray herbicide, you essentially kill the mycorrhizal network. You’re killing these fungi and what happens when the death happens of the fungi is there is a huge feast from the bacteria. The bacteria doubles in population as it consumes all the fungi and then after a little bit the bacteria begins to die and you are left with a substrate of minerals. Just mineral stacked on each other with no organic matter. Typically, in farming organic matter in conventional farms, which is like over 98% of our farmlands globally and farmland makes up 50% of our planets inhabitable. California, 100 million acres of total land, forty-three of those million acres are agricultural. When you look at 98% of that farmland being sprayed with these chemicals, you’re looking at those soils having a half a percent or less of organic matter. And organic matter is this network of life that creates nutrient density. And healthy soil should have like 5% organic, 3, 5, 6, 7, 8% organic matter.

But conventional have a half a percent or less. And so now you’re getting these nutrient dense or nutrient lacking, so starving in nutrients fillings. And there’s a whole bunch of correlations when you talk about our gut health and our brain health and our ability to create things like dopamine and tryptophan and serotonin and all this stuff. When you look at the soil microbiome and our gut microbiome, there’s almost like a mirror. If you are eating foods that come from bad soil microbiomes, your gut microbiome has a good chance of having some of these trace elements in there and having an unhealthy gut microbiome. And then on top of that, what you’re eating lacks nutrition. There’s a huge nutrition part of this but then there’s also in human health part of this not to mention the water and all this but then there’s also a huge carbon part of this. When you take one acre of farmland today, we measure topsoil as basically the first 6 inches of soils and these are fleeting.

They’re being blown away because these chemicals aren’t leaving roots to hold things back, they’re being washed away because there’s no roots holding the soils back, so they’re being washed away by rains. This top soil, if you measure the 6 inches of topsoil and 1 acre and you way that 6 inches 1 acre squared soil, it’s about 2 million pounds of weight. And when you look at a half a percent of organic matter in that soil, it’s about 10,000 pounds of organic matter. If you’re able to then take that from half a percent conventional to let’s say a no-till organic program with none of these chemicals and you get to 5% organic matter, it’s a 90,000 pound increase. When you take that so you take a hundred thousand pounds essentially per acre and you multiply that by the state of California as farmland, 43 million acres, it’s like 4.3 trillion pounds of carbon increase.

There’s a great quote from a friend of mine who said that, and this is a quote of a quote, he was a friend of mine from New Zealand, had said that if we can get to 5% organic matter, we have solved the 60 gigaton CO2 emission problem that we currently have. Granted like you can’t just say hey, we’re going to create 60 gigatons worth of CO2 sequestration. You still have to solve the problem that’s emitting all those which is the fossil fuel and the whole burning hydrocarbons and all the stuff that’s happening on the flip side. But if you think about all the different things that we can do to protect our planet’s biodiversity, our health as humanity and then also help farmers earn more money. This is the reason why Monarch has been so successful and will continue to be successful is because this platform earns farmers more money. Saving them money on fuel, saving the money on inputs and then saving them money on finding drivers that they can’t find so then they go to the chemical … so it’s a whole cycle.

John: Cycle will be prophecy that this is sort of becomes like the flywheel effect.

Carlo: Yeah, and so it’s exciting and it’s been a whirlwind since we began. Just a rocket ship since founding Monarch.

John: I want to ask you, when the 4 of you got together and you started dreaming this up, how hard was it to raise money to make this all a reality?

Carlo: Interestingly the whole entire journey even when the economy was good has been challenging. I think the venture capital market has some incredible outliers, but 90% like brainwashing, people saying whatever they need to say to raise the money within their fund, do like some sort of green fund. But then ultimately, they are holding back on making investments into a lot of the things because honestly the green technology space right now is still a very difficult investment. It’s not 80% software-as-a-service return.

The challenges that we need to do to change our planet require hardware investments and updates and those hardware investments and updates are difficult and you need really incredible teams to be able to solve them. The whole entire raising of money is difficult in any green technology space, even though there’s so much money looking to make these investments. I look to the venture capital; we have some incredible. One of our lead investors for our last round is the world’s largest food sustainability fund [inaudible] out of Belgium. They’re incredible, but we’ve had to go around the world from Belgium and Europe to Asia to the United States and find real visionaries that wanted to solve these hard-hard challenges and put their money into something that they knew was going to be difficult. The exciting thing though is that on the flip side of that is the industry, so the entire strategic world of investment is very keen to solve these problems.

On that side, we’ve had a lot of incredible collaboration and good partnership but agriculture, because we are the 1st of our type, because there’s been no massive exits in our space, because everyone knows this space is absolutely ginormous, every single day people wake up and they go to bed and we eat during the day, we benefit from agriculture. As humanity as a planet, farmers of the most important people on the planet and have the biggest challenges to solve and so everyone knows it’s an absolute massive market, but it’s early days in AgTech and so just the reality is that fundraising is not easy. But we’ve been blessed. We’ve been very fortunate to find our group, our crew and we have the best ambassadors on the planet. We have the best, our impact team, our investment team, everyone is phenomenal, but the sobering reality is that you think that you’d be … this is the truth for any startup. They’re hard, they’re not easy but when you have high ambition and you get out there and you get the right connections and all those things, it’s all surmountable.

John: Is the Monarch 5 going to be the standard or are you going to do like what Apple and other great brands have done? Is there’s a going to be next year in Monarch 6 and is that going to be the evolution or how is that going to work in terms of your branding?

Carlo: Yes, we definitely have different model tractors coming. What we chose was the single largest segment and the tracker universe. This is a forty horsepower tractor with a seventy horsepower peak and when you look at this, it’s like 3.3 million units new sold each year. Is the largest segment in the fastest growing. But on the shoulders, we’ll be doing a smaller and a bigger tractor as well. And then of course, yes, we will be every year, they’ll be new updates and all those things.

John: So, like great entrepreneurs that you and your partners are, you’re always continuously improving your product, your services, your brand. Where does the feedback come? Obviously, you’re a farmer and you are a wine grower and that’s historically in your DNA. Obviously, you’re already using this and your family’s already using the Monarch 5, so feedback’s coming from there. Are you asking and recruiting your 1st generation of buyers to constantly give you feedback on the performance of the tractor and last but not least is technology also playing a part here? Do you have a way of talking with all the products that you have out in the field right now today and are they feeding you back to a headquarter part of place to aggregate all the information that you’re receiving back so you can be testing and benchmarking performance and continually trying to improve that as well?

Carlo: Absolutely. I mean the first thing I just would say is that the data that the tractor provides is 100% owned by the farmers. They can choose to share this data with us and with different app providers down the road. But when we look at the ability that we have basically, we have offices in Hyderabad, India and in Singapore, as we have 24-hour like … so 3:00 in the morning when a lot of us are farming, if something happens, they can send a ticket and we will be able to respond immediately. There’s no wait until 9 AM when the shop opens up.

John: Wonderful.

Carlo: The cool thing about the tractor is similar to an iPhone, as I remember with the first model iPhone, the updates, you’re getting these updates and just everything continues to get better and better and better and still happens with the new iPhone. I think it’s 15 they’re at now. There’s still updates that come. This is software and firmware updates. We have the same exact over the air obtainable. Yes, the tractors continuously improving on the software side and then when something happens and they’re saying hey, there’s an issue, we can basically connect to the tractor through the air, help them solve those problems. Sometimes well, actually almost all the time, it’s just a little update that needs to happen and keep them running.

And then in the event that it’s not, we’re able to go out and figure out if it’s on the site fix or if we need to come pick up the tractor for some other reason. But the service side is the piece when you look at there’s 90% fewer moving parts than the diesel engine. All of the oil changes awesome. My Tesla has 45,000 miles on it right now. I have not once had it serviced. It is like a dreamed and I have to go to the gas station. It’s a dream that I have to go get it serviced. There’s a big piece of the service side that I think is really exciting because it will save farmers time, energy, money and all that and then in the event that something needs to be checked out we can do it over the air.

John: So exciting. How far do you dream out here? Do you and your partner’s dream out? Are you dreaming of the next 5 years, 3 years, 1 year, ten years? What’s your dream out and what does that look like when you lay in bed at night, Carlo and you say, okay, we’ve gotten this far. It’s going to work. Now the question is, is it going to work? The question is how big are you going to get and what kind of impacts are going to make? How far do you look out?

Carlo: I think that what we’re looking out to like 2030 and 2050 numbers in terms of impact and what we’re able to drive and say hey, we think we can get to a gigaton of CO2 by 2050 saved kind of annually type of thing and how we do those calculations and all that. I think the big thing is that when I think about companies that are really changing our planet for the better, I think that there’s ways that we need to start valuing these companies because there’s the dollars and cents piece of the business which we will have a very profitable business, which is important and I think that any company that is working towards helping benefit our planet, they need to be making money.

That’s where I want to spend my money at least. But then there’s the other part of the value chain, which is the impact and what is this company that I’m investing to actually doing and helping from our planetary perspective. And this is where I measure, when I’m looking at companies and Investments, I’m making is like what is the kind of dual value, the value of my money and the value of the impact of my money. This is one thing that I’m excited about talking about when you look at like I just looked at some calculations showing that last year we subsidize the fossil fuel industry by it was like 6 trillion dollars globally, right?

And that these companies these are putting out record profits while these companies have these massive, massive valuations and yet they’re getting subsidized. I’m really excited about the future because I think that these values and the way we value companies and the way that we look at companies is going to be driven largely by the impact they’re able to leave on our planet and the ripple that they leave. When I look at all this, we are very ambitious at Monarch. I think that there’s a road map for us and we are executing to that roadmap to become the world’s most valuable agricultural company not just in terms of dollars and cents but also in terms of the impact that we were able to leave behind.

My co-founders are incredibly ambitious. I’m ambitious about the impact side. We all are very ambitious about the impact side and I think that we’re setting the path that we are able to execute to which is really exciting. The other layer to this is our partners with all of our farmers. We have the greatest customers on the planet, customers that were willing to say, hey, we’re going to take this technology in the early days because we believe in what it can do and we’ll work through the difficulties of setting up a charging infrastructure at the farm, the difficulties of all these little things and the really exciting part about that kind of transition is that a lot of that infrastructure is already on the farm. It just requires maybe if you’re going to do 5 tractors instead of 1, you have to maybe update a couple things. But it’s a very, very, very exciting time in agriculture and as a team were very ambitious about the future.

John: This goes well with the whole new, not new, but the relatively new regenerative agriculture movement that’s also upon us as well. Monarch fits with that whole generational movement as well. Talk a little bit about the IRA. Has that helped you at all? Has that help accelerate your business at all, the Investment Recovery Act?

Carlo: Actually, that’s kind of why when you look at this tractor, it’s at Washington DC and our impact team was there talking with the Secretary of Agriculture for the Farm Bill, which this Inflation Reduction Act, this whole thing did help the agricultural community, but it’s really helped in large a lot of this whole entire renewable movement. I don’t think that it is enough considering when you look at, we’re still subsidizing the fossil fuel industry, whether it’s pink diesel or the exploration of drilling.

I really would love to see less of that and funnel a lot of the subsidies that are on that into taxes that are on that so it’s like a double down and then you’re able to raise funds to be able to move towards this renewable movement. But no, it’s definitely helping and I think governments around the world, I’m really grateful that we are able to put together a plan. We’re working state by state right now, but California is really far ahead with the subsidies. We’re working with, Oregon and Washington right now. We’re working with all the states to slowly but surely get the same kind of subsidies to help farmers divest from the legacy investments that we made when we put diesel tanks on our farms 100 years ago to now, let’s get to this renewable era of farming. It’s all happening. Of course, we…

John: Never fast enough.

Carlo: Exactly.

John: Carlo, thank you so much for your vision, your time today. For our listeners and viewers, to find Carlo Mondavi and his great Partners in all the work they’re doing, they’re making a great impact on this planet, please go to www.monarchtractor.com. Carlo Mondavi, you’re not only making great wine, but you’ve made an amazing tractor with your partners and we really appreciate you making the world a better place.

Carlo: Thank you, John. Great talking, great being with you. Thanks so much.

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