Autonomous electric tractor startup Monarch Tractor warned employees Thursday it may lay off more than 100 workers or potentially shut down entirely, according to an internal memo obtained by TechCrunch. The agricultural robotics company, which raised $220 million to build driver-optional farm vehicles, is struggling with its pivot from hardware manufacturing to software licensing as lawsuits challenge whether its autonomous technology ever worked properly.
Monarch Tractor just delivered the kind of memo no startup founder wants to send. The autonomous farming company warned staff Thursday it might need to cut 102 jobs - or worse, shut down completely - as its desperate pivot from hardware to software hits a wall.
The internal document, obtained by TechCrunch, comes after weeks of quiet layoffs across the company's California headquarters and remote teams in India and Singapore. Multiple former employees confirmed the cuts to TechCrunch on condition of anonymity, painting a picture of a company in crisis.
Founded in 2018 with Silicon Valley pedigree - including Tesla Gigafactory veteran Mark Schwager and Mondavi wine family heir Carlo Mondavi - Monarch seemed destined for AgTech stardom. The company raised at least $220 million, including $133 million just this year, promising "driver optional" electric tractors for vineyards and farms.
But the autonomous agriculture dream is colliding hard with reality. Despite claiming 500 tractors shipped, Monarch faces a damning lawsuit from Idaho dealership Burks Tractor alleging the vehicles were "unable to operate autonomously" and plagued with "significant problems." The lawsuit, first reported by TechCrunch, strikes at the heart of Monarch's value proposition.
Worse yet, Monarch lost its manufacturing lifeline when Foxconn ended their partnership earlier this year, forcing the startup to abandon hardware production entirely. CEO Praveen Penmesta announced a restructuring in late 2024, pivoting toward software licensing and expanding beyond agriculture into golf course maintenance and dairy farming.
The Thursday memo reveals just how precarious this pivot has become. "The new business plan will enable Monarch customers to launch fully commercialized software as a service autonomy and other software offerings direct to consumers," Monarch's HR team wrote. But then came the gut punch: "Unfortunately, the timing for completing the transition to the new business plan puts Monarch at risk of shut down."

