LEXINGTON, Ky. – July 29, 2026 – Bluegrass AgTech Development Corp today announced the winning companies for its third round of Challenge Grant funding, supporting transformative agricultural startups that will help reshape the future of food, farming, and sustainability in Kentucky.
The Challenge Grant program, launched to attract and grow agtech and food-based businesses in Lexington and the Commonwealth, received applications from more than 30 companies. After a competitive review process, six were selected to receive a total of $550,000 in grant funding. Recipients were recognized during an awards ceremony at the University of Kentucky’s new Martin-Gatton Agricultural Sciences Building.
“This grant program, started in 2024, is already having a significant impact on Lexington and Kentucky businesses and farms,” Lexington Mayor Linda Gorton said. “The start-up companies in our first two rounds of funding, which employ 72 people, have already spent over $1.5 million to buy crops from our farmers, processing their crops into new products. Through the new grants we are announcing today, we will continue to build on those numbers.”
Bluegrass AgTech is a partnership among the Lexington-Fayette Urban County Government, the Kentucky Department of Agriculture, the University of Kentucky Martin-Gatton College of Agriculture, Food and Environment, and Alltech.
“Kentucky agriculture has always been built on innovation, and these companies are helping shape what comes next. By investing in entrepreneurs who are developing practical solutions for our farmers, strengthening our food system, and creating new opportunities in rural communities, we’re ensuring Kentucky remains a leader in agricultural innovation for generations to come,” said Kentucky Agriculture Commissioner Jonathan Shell.
The 2026 Challenge Grant program was available to registered, for-profit businesses located in or willing to relocate to Kentucky, with a strong emphasis on early-stage and startup ventures. Each recipient was eligible to receive up to $100,000 in grant funding to accelerate its growth and impact.
“These Challenge Grant recipients demonstrate what is possible when we connect entrepreneurs with the research, expertise and statewide relationships of our land-grant system,” said Dr. Laura Stephenson, vice president for land-grant engagement and dean of the UK Martin-Gatton College of Agriculture, Food and Environment. “By helping promising ideas move from development to real-world application, we are strengthening Kentucky agriculture, creating new economic opportunities and delivering practical solutions for producers and communities across the Commonwealth.”
This year’s grant winners reflect the breadth of Bluegrass AgTech’s five strategic focus areas: Future-Proof Animal Protein, Food is Health, Sustainable Food Systems, Solutions for Mid-Size Farming, and Kentucky Traditions. The winners are:
- FarmSense is commercializing an affordable soil moisture sensor developed with Kentucky farmers, priced at $50 to $80 per unit versus $200 to $600 for commercial alternatives. Field testing shows a 40 to 48 percent reduction in water use and improved crop quality, and grant funds will support Kentucky-based manufacturing, sensor calibration, and a 15- to 20-farm pilot program ahead of commercial launch.
- Lepidext is revolutionizing insect pest control by developing biopesticides to manage populations of the corn earworm and other destructive lepidopteran pests. Its biopesticides are designed to be safe, effective, species-specific, and easy to use. Lepidext manufactures the product at its Lexington rearing facility, with production scaling to serve national markets.
- Need More Acres Farm is a Kentucky-based farm and regional food hub connecting locally grown food with healthcare, schools, and community partners through Food is Medicine, Farm to School, and home delivery programs. Its Food is Medicine work integrates clinical referrals and participant data collection, allowing healthcare partners to prescribe local produce and track outcomes. Working with a network of more than 30 partner farms and pairing those relationships with online ordering and delivery technology, Need More Acres is expanding access to Kentucky-grown food while creating reliable markets for producers.
- Pascal Tags is adapting its proven Barcode 2.0™ platform, already deployed with customers including GE Appliances and the Defense Logistics Agency, for agricultural applications. Through a pilot deployment with a commercial farm, the project will engineer and validate the technology to withstand demanding agricultural environments, including moisture, dirt, and repeated handling, while replacing failure-prone paper records and traditional barcodes with durable, automated asset tracking for farm inputs, harvested products, and reusable agricultural equipment.
- Silver Fern is a Lexington, Kentucky, software company, founded in 2020, whose Work Suite platform helps greenhouse and nursery growers plan production, forecast demand, and fulfill orders. About 150 growers across the United States and Canada run on its software. Grant funds will support RESTOCK, the company’s AI demand-forecasting module, which uses machine learning to predict store-level plant demand and cut losses that come from narrow, weather-dependent selling windows.
- Sunnyside Egg Co. is scaling regenerative, mobile egg production to give Kentucky farmers a lower-cost path into pasture-raised eggs, requiring roughly $120,000 to start compared to the $2 million typical for major pasture-raised egg operations. Kentucky’s mild climate makes it an ideal base for the model, and grant funds will support the company’s 2026 packing facility expansion, growth to 45,000 hens, and development of carbon credit software.
“The future of agriculture will be shaped by the innovators who see possibilities where others see challenges,” said Dr. Kyle McKinney, vice president of innovation at Alltech. “That’s why
Alltech is proud to support Bluegrass AgTech and the entrepreneurs it empowers. By accelerating breakthrough ideas, we’re helping producers become more efficient, sustainable and resilient while strengthening the future of farming for generations to come.”
The mission of Bluegrass AgTech is to cultivate an innovation ecosystem for entrepreneurs and agtech startups across Kentucky. “The impact from our Challenge Grant awardees is doing exactly what our founding partners envisioned: proving Kentucky can compete in agtech and opening doors to what comes next. We’re already developing new partnerships and programs on that momentum, and this round of winners gives us even more to build on,” said Jacob Ball, Executive Director of Bluegrass AgTech Development Corp.
The first two rounds of funding, announced in August 2024 and September 2025, included 10 companies focused on advancing the future of agriculture and the environment, from sustainable materials and renewable fuels to innovations in animal health, equine technology, and crop protection. Those recipients received a combined $925,000, which has been leveraged into more than $12 million in follow-on investment and has supported 72 jobs and nearly 100 farm engagements. These outcomes highlight how Challenge Grant investments continue to drive innovation while delivering real economic and on-farm impact across the Commonwealth.
To learn more about the Challenge Grant program or explore opportunities to contribute to BADC’s mission of building Kentucky into a hub for agtech innovation, visit https://bluegrassagtech.org/ or reach out directly at info@bluegrassagtech.org.
About Bluegrass AgTech Development Corp
Bluegrass AgTech Development Corp is a public-private partnership working to grow Kentucky’s agtech ecosystem by supporting entrepreneurs, strengthening industry connections, and driving innovation across agriculture and food systems. Bluegrass AgTech Development Corp is an initiative of Lexington-Fayette Urban County Government, Kentucky Department of Agriculture, University of Kentucky Martin-Gatton College of Agriculture, Food and Environment, and Alltech. For more information, contact us at info@bluegrassagtech.org.
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Photos from the awards ceremony and company logos are available upon request. Media Contact
Jacob Ball
Executive Director
Bluegrass AgTech Development Corp
824 Bull Lea Run, Suite 219, Lexington, KY 40511
jacob.ball@bluegrassagtech.org
(859) 346-8097
