AgriFood Tech start-up deals & trends 2018

AgFunder just released the 2018 AgriFood Tech Investing Report detailing another record-breaking year where investment in food tech and agtech startups globally increased 43% year-over-year to nearly $17 billion (~R246 billion).

Here are some more key insights:

  • A maturing industry: deal sizes increased, particularly at the later stages - the median for Series D rounds was $73m (R1bn) (above the cross-industry average of $50m (R726m).

  • Global Diversity: while the US still dominates the industry (46% of total funding; 40% deal count), the industry is getting more global as new markets come online, and India, Brazil and China produced the year’s largest deals (China was particularly active - think robotic retail and online marketplaces). These sizes also indicate the presence of a diverse range of investors.

  • Robotics & automation: on the farm, in the supply chain, and at the retail level, startups automating menial tasks across the industry gathered pace amid growing concerns around labor shortages.

  • Gene-editing startups drove much of the 50% increase in Ag Biotech investment, which reached $1.5bn (R21bn), as well as microbial products businesses with Indigo's $250m (R3.6bn) Series E the largest.

  • Restaurant Marketplaces and eGrocery continued to bring in the most amount of funding, with some very large, late-stage deals but also a 30% increase in the number of deals indicating the creation of new companies in the category, despite the wealth of options on the market and the geographical dominance of some services. Consumer demand for convenience and on-demand is relevant across the globe.

  • Agribusiness Marketplaces are another global phenomenon as startups aim to connect farmers to buyers and improve their chances of getting higher prices for their crops and access to better farming products and services.

  • Innovative Food e.g. alternative meat and dairy: still a small category but the number of deals increased (to 70 from 57) as more entrepreneurs focus on new food formats. And the trailblazers in this category are starting to mature, raising large rounds.
  • Exits & M&A: 2018 saw the largest exit on record after private equity group BC Partners sold digital animal health business Antelliq to Merck for $2.4bn (R35bn). And the pace of M&A activity increased overall during the year.

Download the full report here