Agtech start-ups are facing a long investment slump, but a wider mix of public grants, private capital and money from retailers and other supply chain companies is giving them an alternative to the traditional venture capital route, said Dr Belinda Clarke, director of Agri-TechE, which links farmers and growers with researchers, technology developers and investors.
Clarke spoke after Agri-TechE's annual Focus on Finance event, held at NIAB in Cambridge on 17 September, which brought entrepreneurs together with investors and public funders, from the Advanced Research and Invention Agency (ARIA) and Innovate UK to angel investors and venture funds. "There's no sugarcoating the fact that it is a tough investment environment," she said.
What has made her "increasingly positive" is the involvement of large supply chain players. As an example, the UK's largest supermarket, Tesco, has become the anchor investor in Henry Dimbleby's GBP 100 million Bramble food innovation fund. Clarke said such backing can help young companies show revenue earlier and stop depending on grants.
Retailers and food businesses have their own reasons, she said: technologies that make farms more efficient can also cut the greenhouse gas emissions in their supply chains, known as Scope 3 emissions. Their criteria tend to be more specific than public programmes, for example post-harvest storage, longer shelf life or lower emissions, which makes their money a complement to public funding rather than a replacement.
On public funding, Clarke said the UK has perhaps never had it so good, pointing to the Farming Innovation Programme and joint work by Defra and Innovate UK on early, pre-seed support. The hard question for government, she said, is balance: spreading money across many ideas or concentrating on a few priorities such as soil health or water. Backing high-risk ideas that look "wild" at first, as ARIA does, can produce transformational technology.
Clarke also sees a shift away from hunting for the next single breakthrough, whether AI, robotics or biologicals, towards bundling several technologies around a specific farm or supply chain problem, with farmers acting as the integrators. Technology, she said, must not only work but fit practically into the way farm businesses already run.
The report was written by Oliver Morrison for AgNavigator.
Source: AgNavigator
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