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August 2016

How Sustainable Is The Agritech Venture Ecosystem?

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How Sustainable Is The Agritech Venture Ecosystem?

There’s no doubt that agriculture technology, as a sector of innovation, is having a moment. Investment funding into agritech startups has surged in recent years, topping $4.6 billion in 2015 up almost 10X from 2012. During the first half of this year, there has been a cooling in agritech investment alongside the pullback in global venture capital markets. The agritech sector recorded $1.8 billion across 307 deals in H1-2016 compared to $2.2 billion and 285 deals in H1-2015 according to AgFunder’s newly-released Mid-Year AgTech Investing Report.

With signs of a slight rebound in the global VC market in the second quarter of this year, we don’t expect the pullback in agritech to be sustained, particularly given the number of new agritech specific funds (7) and accelerators (12) that were announced in H1. During the first half of 2016, the number of other investors coming to agritech also increased, with 52% more unique investors recorded compared to the first half of 2015.