Agriculture Technology companies (Ag Tech) have hauled in as much VC and angel investment ($100M) as more celebrated areas like transportation tech (think Uber, Lyft, RelayRides). AgTech has also pulled in 2/3 of the amount that has gone to (and which may evaporate from) App Discovery Platforms. Clearly, AgTech and the idea of applying software and hardware technology to all aspects of the farming process from production to supply chain and distribution is hot. The last year’s $103M was spread across 41 deals with prominent venture capital investors putting money to work in a number of early stage deals.
Companies in AgTech cover a wide range of technologies ranging from consumer-focused firms such as AgLocal (backed by Andreessen Horowitz) or Farmigo (Benchmark Capital) or Good Eggs (Baseline Ventures & Harrison Metal – both top 10 Seed VCs, by the way) as well as more farm performance/farmer-focused technologies such as Solum (Andreessen Horowitz/Khosla Ventures), a developer of field measurement technology and Farmeron (NextView Ventures and SoftTechVC), a farm performance data company.
The Ag Tech market is still relatively immature, as the figure below illustrates, with nearly 78% of deals at the seed/angel and Series A stages. But as concepts and technologies are validated, mid and later-stage funding will pick up as evidenced by the strong growth of Series B transactions.
Just 20% of Ag Tech companies that received funding in the past two years originate in Silicon Valley. Many (>50%) are instead based in locations that align closer with the needs of agriculture-heavy markets. AgLocal and DuPont-backed Farms Technology, for example, are based in Kansas while others such as Y Combinator alum FarmLogs and backed by Hyde Park Venture Partners and Huron River Ventures, based in Michigan, and Minnesota-based farm software start-up Conservis, might appeal to farmers in the Midwest.
