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AgButler aims to solve labor shortage

Lebanon farmer creates app to connect agriculture laborers and employers

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A new mobile app aims to connect agriculture laborers, farmers and ranchers as part of the gig economy.

Kevin Johansen, a fifth-generation farmer in Lebanon, founded AgButler Inc. last year as a way to help his family and other agriculture producers find part-time help. That led to the creation of the AgButler app, which launched five months ago.

Employers and laborers can set up profiles for free on the app, where similar to a ride-sharing service, they log in to search for users within a certain geographic range. They then can hire help or apply for jobs. Employers can post job descriptions and requirements, while laborers can filter jobs using criteria such as location, industry and pay rate. A flat $20 fee is paid by the employer once a connection is made.

“Our goal is to help alleviate the bottlenecks that farmers and ranchers face trying to find labor,” said Johansen, who runs his family farm, 5J Charolais. “It’s a new way of part-time help, because most people just use someone that they know in the area or that they have a relationship with. Getting them comfortable with talking to sometimes complete strangers and helping them on their property will take a little bit of time to cultivate.”

Prize money
The app has garnered notice as Johansen promoted AgButler in several regional competitions last year, winning awards at three of them with prize money totaling nearly $30,000. The contests were American Farm Bureau Federation Ag Innovation Challenge in Austin, Texas; Ag Tech Innovation Competition in Des Moines, Iowa; and Pure Pitch Rally in Kansas City.

Johansen said the biggest financial boost came after the Ag Tech competition, when he received a $174,000 grant from Missouri Agriculture and Small Business Authority. The grant and award winnings have helped keep company investments relatively low at under $300,000, he said. That includes a $50,000 line of credit from Tipton Latham Bank, located in his childhood hometown of Latham.

App usage has been gradual, as Johansen said roughly 350 users have filled out online profiles. It averaged around 100 new monthly users in the fall but has slowed in the winter. He estimated another 250-275 people have downloaded the app but haven’t finished the registration process.

“That’s still a good sign of people that see a need for it,” Johansen said of the downloads, noting he’s targeting 100 new users per month.

Johansen said he was a freelance worker during his college years, traveling all over Missouri on weekends to work on other farms or help at cattle shows.

“I would call myself a perfect example for this platform to make it easier for a freelance worker to be able to get more jobs per year in a variety of different operations or tasks,” he said. “As someone who has hired part-time laborers, it’s nice to have multiple options instead of just three or four phone numbers you call.”

Many farm operators are considered part-time workers, according to the 2017 U.S. Census of Agriculture. Around 1.5 million of the 2.7 million principal farm operators in the nation report something other than farming as their primary occupation. Small farms make up the majority of the industry, with roughly 58% having sales of less than $10,000, according to census data.

When researching the viability of starting AgButler, Johansen said he sent around 200 surveys to friends and family in the industry. Responses connected to their use of part-time labor gave him the confirmation he needed. According to those surveyed, about 40% spent $2,000-$5,000 annually on part-time work, he said, adding almost 18% spent over $10,000 a year.

Planting seeds
Johansen said AgButler generates revenue from built-in banner ads, as well as the flat $20 connection fee employers pay each time they hire laborers. Revenue for 2020 was less than $10,000, he said. However, he projects $150,000 this year based on expanding the company’s focus beyond its current area of Missouri, Kansas, Iowa, Nebraska and Texas. A subscription-based model for agribusinesses also is being discussed, he said.

“As we grow our user base and get more jobs in, we’ll look to make it a tiered connection fee,” he said, noting some jobs, such as transporting farm equipment or spraying herbicides on crops, require more time and technical skills. “We landed on $20 to be in the middle and the safe route.”

Missouri Cattlemen’s Association, Missouri Soybean Association, American International Charolais Association and University of Missouri Extension have banner ads in the app. He said those ads were done as a trade out for the first year in appreciation of the agriculture organizations advocating for AgButler from the start with letters of support.

Lorin Fahrmeier, Farm to Institution project coordinator for MU Extension, said she was “instantly intrigued” upon hearing about AgButler and its business model last year. She sees it as a complementary app to Missouri Food Finder, a new website MU Extension created to help local food producers quickly market their products. The online tool connects consumers to people growing and selling locally produced food in their region.

“It was a way to help local farmers continue to market their product in a little bit different way,” she said, noting the site was created in April 2020, as food shortages became more prevalent amid the coronavirus pandemic. “It was put out there so Missourians could seek out local food pantries, small local grocery stores.”

A link to AgButler has since been added to the Missouri Food Finder site. However, there’s no financial arrangement in place, she said.

“With the addition of AgButler on there, they can find food, but they can also hopefully find work in the ag sector,” Fahrmeier said. “We thought we could hit a lot of the same audiences and kind of collaborate on our efforts there. It was a feeling we could benefit from a relationship to help each other’s sites grow.”

Close to 70% of AgButler’s users are from Missouri, Kansas, Iowa and Illinois, Johansen said, adding he had no user projections upon the app launch. He said a marketing campaign for the app is expected to roll out this year.

“In a perfect world, we’d launch and have all these users and a bunch of connections and some good revenue rolling,” he said. “It’s going to take us a little bit more to make that scene happen. I would almost call this a live market beta test to kind of get it out, let people utilize and get comfortable with it.”

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