hektar9 is Germany’s largest and fastest-growing marketplace for offering and renting agricultural machinery between farmers (C2C) & retailers (B2C) – and also for offering agri services between contractors & farmers. Launched in 2022 by serial entrepreneurs (ex-founders of mitfahrgelegenheit/carpooling, exit to blablacar), hektar9 gives farmers, contractors and dealers access to easily rent agricultural machinery and services.
Describe your product or service; what is it and what makes it innovative?
hektar9 is an innovative digital platform designed for cross-manufacturer agricultural machinery rentals and agri services. What makes it innovative is its emphasis on market-transparency, cost-efficiency, flexibility, and its unique insurance coverage for the rented machine.
hektar9 provides farmers, contractors, and machine retailers with unprecedented access to a wide range of high-quality farming equipment, regardless of the manufacturer, simplifying the rental (finding, booking, invoicing & payment process. The platform offers a cost-effective alternative to purchasing machinery, without long-term commitments, and facilitates short-term and last-minute bookings, enhancing flexibility. Comprehensive insurance coverage safeguards against financial losses due to equipment damage. hektar9’s complete digitalization streamlines the booking and billing processes, reducing administrative burdens, making it a game-changer for the agricultural industry.
Describe your value proposition; who is this for and why do they want it?
hektar9’s value proposition is geared toward farmers, contractors, and machine retailers in the agricultural sector.
Acquiring machinery is getting more and more expensive due to rising capital costs and increasing high tech machinery. We have shown, that renting a tractor on a farm is cheaper when operating it less than 700 hours / year, above that operation hours, it makes sense to acquire the machine. Average usage is less than 500 hours per year in Germany, so for most farmers owning a tractor is not efficient.
Hektar9 platform makes booking a tractor or other machine as easy as booking a rental car, even between famers (P2P approach).
What is the estimated market size that can be served by the innovative solution?
The potential market demand for hektar9’s innovative solution in the agricultural machinery rental sector is substantial. According to data from Sandra Ahrens in the statistics “Turnover with Machine Brokerage in Agriculture in Germany until 2021,” published on December 9, 2022 (Link: https://de.statista.com/statistik/daten/studie/163396/umfrage/umsatz-mit-maschinenvermittlung-in-der-landwirtschaft-seit-2004/), the turnover generated by machinery rings in 2021 through machine brokerage in the German agricultural sector is estimated to be around 593 million euros, distributed among approximately 262,800 agricultural businesses in Germany. The overall turnover of the industry for the rental of agricultural machinery and equipment in Germany was estimated to be around 1.09 billion eurosfor the year 2020. In 2016, there were about 10.0 million farms in the EU-28, which is approximately 38 times as many farms as in Germany. The turnover for machine brokerage in all of Europe is therefore estimated to be around 38 billion euros. This figure does not include the revenues of contracting companies, i.e., machine brokerage with operators. This impressive turnover underscore the enormous market potential for the hektar9 platform.
Describe your pricing model and/or any customer discovery you’ve performed to assess ‘willingness to pay’
hektar9’s pricing model is simple and clear: machine owners are not charged to pay for our service (to give them a high incentive to post their machines), while renters are charged a up to 15% commission on the transaction. We decided for this pricing model after thorough customer research, engaging with farmers, contractors, and machine dealers.
The insurance cover for the machines is new in the market and is attached to all rentals. Additonally, the access to a wide range of equipment, streamlined rental processes, insurance coverage, and reduced administrative burdens all resonated positively with users.
This user feedback strongly validated our pricing model and confirmed that it is aligned with customer preferences and the perceived value of the services provided by hektar9. It reinforced the platform’s competitiveness, attractiveness, and financial sustainability within the agricultural machinery rental market.
What other competing solutions are offered and by whom?
In the landscape of agricultural machinery rental and related services, there are several competing solutions offered by various providers. These competitors offer a range of alternatives to users in the agricultural industry. Here are some of the key competing solutions and the entities behind them:
Traditional Machinery Brokers: Traditional machinery brokers have long been a common solution for agricultural machinery rental. These brokers typically operate on a regional or local level and connect machine owners with renters. They may charge a commission or fee for their services. They are often limited to their brands to be sold to push them into the market. They do not offer machines between farmers what we consider as crucial to realise sustainability of ag machines.
Local Equipment Rental Companies: Many local equipment rental companies specialize in providing agricultural machinery for rent. These companies have physical locations where users can access and rent machinery directly. They often serve a specific geographic area.They often have a fractioned market view (many small players) and cannot leverage digital features. This leads to a lower market efficiency.
Online Classified Platforms: Online platforms that specialize in classified ads for agricultural machinery are competitors. These platforms allow users to list machinery for rent or sale. Examples include platforms like TractorHouse and MachineryTrader. The market is very fractioned and is a classified business only. This leads to a lower market efficiency.
Agricultural Co-ops: Agricultural cooperatives or co-ops sometimes offer machinery rental services to their members. These co-ops are often formed by groups of farmers who pool resources. This is the predominant solution for the market. However, these players mainly work with Excel and paper and cannot use digital features efficiently (old economy).
Equipment Manufacturers: Some agricultural equipment manufacturers may have their own rental programs, allowing users to rent their machinery directly from the manufacturer. For example, John Deere, a well-known agricultural equipment manufacturer, has ventured into such programs. They will always enable solutions for their own brand and will build solutions tu push new machines into the market. They will never get to market-efficient solutions.
Agricultural Service Providers: Certain agricultural service providers, such as farming support organizations, may facilitate machinery rental arrangements for their members. These providers focus on offering a wide range of services to farmers. Very small providers, never habe the power to build a market-place-
Each of these competing solutions has its unique strengths and weaknesses, and they cater to different segments of the agricultural machinery rental market. Some are well-established, while others may be more regionally or locally focused. In contrast, hektar9, with its innovative digital platform and comprehensive services, aims to provide a competitive and user-friendly alternative by addressing the limitations and complexities often associated with traditional methods.
What regulatory hurdles or barriers to entry do you anticipate?
There are no regulatory hurdles. The market is already existing but is very rigid and old fashioned, i. e. manually operated. Some market players still base their business on in-transparent pricing and processes which hinders an efficient market.