The Bay Area-based Monarch Tractor, a startup specializing in autonomous electric tractors, has announced a 10% workforce reduction, equating to about 35 employees, as part of a strategic pivot and restructuring. This follows a previous 15% staff cut in July, reflecting ongoing challenges in the agricultural sector. CEO Praveen Penmetsa attributed the decision to financial difficulties within its core customer base, particularly California vineyards, and the company’s failure to meet third-quarter growth expectations. These factors have compelled Monarch to diversify its target markets.

Since its establishment in 2018, Monarch has raised $220 million in funding, including $133 million earlier this year, but has faced headwinds as ag-tech investment slows and agricultural customers grapple with economic hurdles. The company is now expanding beyond agriculture to pursue opportunities in sectors like solar farms, golf courses, and municipal land management, where its technology can be applied to land maintenance.

Monarch is also emphasizing its AI-powered farm management platform, WingspanAI, which has attracted interest from off-road vehicle manufacturers for nonagricultural uses. This shift underscores a broader strategy to grow its influence in off-road electrification and driverless vehicle technology while retaining a commitment to agricultural innovation.

The company, featured on Forbes’ “Next Billion-Dollar Startups” list last year, sees its pivot as a way to enhance profitability, sustainability, and global food security while leveraging its expertise to serve a wider array of industries. Penmetsa highlighted the need for agility and efficiency to achieve these goals while maintaining leadership in autonomous and electric vehicle solutions.