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Agtech

Market Map: Investors cultivate what’s next in agriculture

Agtech has seen an explosion of investment activity as many startups search for ways to solve shortages and climate change’s effects on our food supply.

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Last year was a perfect storm for the agricultural industry. Ukraine, known as the “breadbasket” of Europe due to its bountiful supply of grain, was engulfed in a war that has cut it off from the world. An avian flu outbreak sent the price of eggs soaring in the United States. And the Colorado River, a major source of water for farmers in Arizona and California, hit record lows.

Meanwhile, agtech saw an explosion of investment activity as many startups searched for ways to solve shortages and climate change’s effects on our food supply. The market map below outlines the global agtech VC ecosystem. Explore the precision agriculture segment by clicking on the blue title below.

 

To go deeper, read our Q4 2022 Agtech Report. PitchBook clients can also explore the full market map with details on all the segments.

Spotlight: Precision agriculture

The precision agriculture segment is made of four subsegments:

  • Robotics and smart field equipment: The tools that are used to cultivate, secure and manage crops on a farm.
  • Drone and imagery analytics: Tracking harvests and fields of crops to understand how a harvest is progressing and where additional resources may be needed.
  • Farm management software: Marketplaces for hiring workers, avenues for selling goods and grains, and software to help break down data from drones and other tools.
  • Field internet of things: Devices that help farmers understand and monitor their crops that are disbursed across a wide geographic range.

How deals and exits are trending

 

In Q4 2022 there were 188 deals worth nearly $1.8 billion tracked by PitchBook, down 6.9% and 34.2%, respectively, compared to the previous quarter. Year-over-year, deal value declined from 2021’s high of $12.3 billion to $10.6 billion, down 13.8%.

Despite the decline, PitchBook analyst Alex Frederick says that interest in agtech remains historically high due to geopolitical and environmental challenges.

Notable recent deals include a $46.5 million round for Verdant Robotics, a startup building specialized nozzles that utilize computer vision to target where to spray herbicide, and Capella Space, a startup developing radar technology to help monitor crops during difficult weather events, which closed a $60 million funding round in January.

 

Exit activity took a sharp hit in 2022. There were 38 deals worth $2.22 billion compared to 2021 which saw 61 deals worth over $30 billion, according to PitchBook data. That is a 93% drop in deal value and a 38% drop in deal count.

Still, there were some notable exits, made up entirely of acquisitions. Biomaterial provider Enerfarm was acquired by Equitix for $30.3 million and BlackRock acquired Vanguard Renewables through an estimated $700 million leveraged buyout.

Featured image by OlegRi/Shutterstock

  • jacob-robbins-headshot.jpg
    Written by Jacob Robbins
    Reporter Jacob Robbins covers artificial intelligence and the venture capital ecosystem for PitchBook. Based in Seattle, Jacob is originally from Massachusetts and holds dual degrees in political science and cinema studies from the American University. His work has previously appeared in Air Mail and Business Insider.
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