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Daily news and analysis about the food tech revolution

AgFunder

AgFunder: Record-breaking $31B Invested in Agrifood Tech in 2020

Ag tech VC firm, AgFunder, released its annual report on agrifood tech funding today. Companies in this sector raised $26 billion in 2020, a 15.5 percent increase over 2019. If that wasn’t enough, AgFunder actually expects that already record-breaking figure to bump up to $30.5 billion as more deals done in 2020 are revealed.

The AgFunder 2021 Agrifoodtech Investing Report breaks the agrifood tech sector into “upstream” companies, which are closer to the farm, and “downstream” companies, which are closer to the consumer. AgFunder said that for the first time on record, upstream companies outraised downstream companies in 2020. Those upstream companies pulled in $15.8 billion across 1,950 deals, while downstream companies raising $14.3 billion across 1,142 deals.

AgFunder also found that alt-protein/novel ingredient/functional food companies raised $2.3 billion across 26 deals, and that e-grocery was the most funded downstream category, raising $5.1 billion across 119 deals. AgFunder noted that the agrifood tech sector is maturing, with startups at both growth and late stage raising larger deals than ever before.

“This is no longer seen as a niche, experimental and risky sector, highlighted by the increase in the median size of growth stage and late stages deals,” Louisa Burwood-Taylor, head of media & research at AgFunder, said in today’s press announcement. “Investors piled in despite Covid; the first wave of innovators in each category are now mature and able to raise huge rounds with many household names such as Impossible Foods; and the second wave of innovators is now raising much larger rounds than the first wave did at the same stage.”

What’s interesting about that statement is that AgFunder positions this growth in agrifoodtech as being in spite of the pandemic. While the pandemic has inflicted enormous economic difficulties around the world, it also seems like there was increased investment because of the pandemic. Downstream technologies in particular benefited as restaurants and grocers all accelerated adoption of systems that reduced human-to-human interaction and helped meet the rising demand for e-commerce to get our food.

AgFunder’s report reinforces earlier data showing the increased investment in food tech in 2020. Pitchbook said that a little more than $12 billion was invested in food tech companies last year. There is probably some definitional and scope differences between the two reports, but the broader point stands. Food tech companies raised a ton of money last year, and with the pandemic still very much a part of our lives, the breakneck pace of investment will continue in 2021.

AgFunder: Meat Alternatives, Indoor Farming and Cloud Kitchens Score Top Investments in 2019

Global venture capital fund AgFunder today released its 2019 Agri-FoodTech Investing Report, which gives a birds-eye view of the investment landscape in agriculture and foodtech (also known as agri-foodtech) companies over the past year.

Overall, it was a pretty fortuitous year for startups in the space. According to AgFunder’s report, agri-foodtech companies raised a total of $19.8 billion last year. That’s a 4.8 percent drop in funding from 2018 (a blip which the report pins on the US-China trade war and Brexit), but the industry still experienced roughly 250 percent growth over the past five years.

A few areas in particular enjoyed some hefty investment last year: meat alternatives, robotic food delivery, indoor farming, and cloud kitchens. If you’re a regular Spoon visitor, that probably won’t surprise you; we’ve been reporting on the growth of these industries extensively over the past year (plant-based meat and cloud kitchens, in particular).

One foodtech area that AgFunder reports did not see an increase in investor interest, however, was meal delivery. Quite the opposite, actually. AgFunder notes that investment in consumer food delivery declined 56 percent year-over-year as the market became oversaturated. The growing controversy over third-party delivery could also have something to do with it.

Upstream + downstream agri-foodtech investments. [Photo: AgFunder]

As investment in agri-foodtech grows and diversifies, so too does the investor pool itself. AgFunder’s report notes “more generalist, big global players and corps,” are flocking to agtech and foodtech startups, including giants like SoftBank, Amazon, and Microsoft.

There’s also a geographical expansion. Led by record interest from U.K., funding in European agri-foodtech companies nearly doubled in 2019. Latin America also had what AgFunder dubbed a “breakout year,” raising $1.4 billion for the sector. Unsurprisingly California still led in the U.S. (thanks, Silicon Valley).

Of course, we have to take the report with a grain of salt. As a venture fund itself, AgFunder obviously has reason to make its chosen area look like a white-hot space. Nonetheless, I think it’s fair to say that agtech and foodtech are indeed entering the mainstream — and attracting due investor attention.

2019 saw “far out” technologies like cell-based meat and drone food delivery, become… well, not mainstream, but at least less far-fetched. As they continue to mature — and fight through regulatory red tape to actually hit the market — I’m betting that we will see investments in the agri-foodtech continue on their upward trajectory.

Applications Are Now Open for AgFunder’s Singapore Agri Tech Accelerator Program

Calling all agricultural-focused startups. This week, agri tech VC firm AgFunder announced its forthcoming startup accelerator, GROW, is now accepting applications.

GROW is a joint venture between AgFunder and agrifood accelerator Rocket Seeder, and includes backing from the Singapore government through Enterprise Singapore and the Economic Development Bank. The program will work with early-stage startups in the agri tech space to help them fine-tune their business models, identify target audiences, and prepare to get further funding.

Though based in Singapore, the program encourages startups from around the world to apply. According to an AgFunder blog post, those chosen to participate will receive up-to $120,000 in equity funding, $80,000 in-kind benefits, coaching and mentorship sessions, and access to “experts, test labs and deep-tech expertise in GROW research partners.”

Participants are expected to be in Singapore for part but not all of the duration of the three-month program, which kicks off in September. According to GROW’s FAQ page, those who complete the program will also become eligible for the accelerator’s +3 GROW program, which includes an additional three months in the GROW coworking space in Singapore along with extra coaching during that time.

AgFunder’s current portfolio includes companies that cover a range of different technology solutions both on the farm and in the food supply chain. Trace Genomics, for example, uses a proprietary analytics engine to help farmers track soil health. ImpactVision’s technology assesses food quality and safety through hyperspectral imaging. Aerobotics uses satellites and drones for pest-control on the farm.

As to why Singapore is the chosen location for the accelerator, part of the reason is that agri tech in that country is still fairly nascent and therefore needs more investment. Quoting Openspace Ventures’ Nicole Tee, the AgFunder blog post noted that, “it’s still early days for agtech in the region and so creating an active ecosystem was important to drive further investment and create ‘credible players in the global markets.'”

Of late, Singapore has received much attention for its role in developing cultured meat, as well as its recent $535 million investment to boost R&D in areas like robotics, AI, and sustainable urban food production. And other accelerator programs already have a presence in Singapore, including HATCH’s aquaculture program and Big Idea Ventures, who’s mainly tackling alternative proteins right now.

According to AgFunder, GROW is the first agri tech-specific startup accelerator to be based in Singapore. Applications close on August 19.