This year there was a step change in Australia’s agtech activities and a growing groundswell of momentum for agrifood innovation. With the year coming to a close, I’ve been reflecting on how far and fast Aussie agtech has come, and what we can look forward to (and watch out for) in 2018.
Since the release of Powering Growth by StartupAus and KPMG calling for agtech to help grow agrifood in Australia “to $100 billion in export earnings by 2030”, the agtech ecosystem has been maturing. And it’s not just coming from the tech community; industry bodies, research organizations, government and investors are all keen on agtech.
Take hyperspectral remote sensing startup, FluroSat, as an example. After completing the GrowLab accelerator program (supported by the MLA Donor Company [MDC]) and winning runner-up at TechCrunch Startup BattleField Australia, FluroSat secured $1M in investment from Cotton Research and Development Corporation, Main Sequence Ventures, and Airtree Ventures. This investment, and the FluroSat journey, demonstrates just how far the agtech ecosystem has come, and how it’s truly entered the mainstream.
Farmers, who are critical to the success of innovation in agriculture, are also playing an increasing role in the agtech ecosystem. In their work with emerging leaders in agriculture, AgriFutures Australia found that over 50% of these leaders see agtech as important for the future of the industry and their careers. One path for farmers in Australia is to develop their own entrepreneurial skills, for example through MDC’s Producer Innovation Fast Track Program.
I have been lucky enough to work with seven farmer-entrepreneurs in the new venture development stream of this program, and could not be more excited about their potential to bring innovations and new ways of thinking to the industry.
Still not convinced that agrifood innovation is a thing that’s here to stay? Perhaps the number of agtech and foodtech startups- over 140 by our count- will change your mind. These startups span the value chain, and come from all states and geographies of Australia.
While it’s still early days for many of these startups, Australian agtech startups have begun to raise capital and expand internationally. Examples include AgriWebb ($8M+), FarmBot (~$1M), The Yield ($7.4M), Agersens ($2.3M), Agworld ($11.5M), and Observant (acquired by Jain).
The landscape of support for agtech innovators is expanding as well. For example, SproutX, Australia’s first dedicated agtech accelerator and venture capital fund, which features support from the Victorian government and industry players such as RuralCo and Ridleys, graduated their first cohort of agtech startups late this year. Many of these companies have secured industry partnerships, commercial trials, and/or capital investment.
But SproutX is no longer the only accelerator program for agrifood in Australia. Seven other accelerators (and incubators…the lines here are still blurry) have emerged to support innovators in Australia. In addition to accelerators, other resources with different value propositions to startups and business models, such as conferences, pitch competitions, and prizes, have hit the scene.
All of this growing momentum for agtech in Australia is exciting and promising; but, we don’t yet have a flourishing ecosystem that’s guaranteed to avoid the hype and deliver on the potential value of agtech. While Australia isn’t ever likely to become the next Silicon Valley (or Israel) — we can still build a successful, collaborative, and internationally relevant ecosystem.
To do so, it’s important to focus on initiatives that are practical and productive. Let’s grow the pie for Australia, rather than worry about which slice of the pie we all own. And let’s not lose sight of the big picture vision for the success of this new industry.
How do we do this? Here are a few ideas:
Agrifood tech startups will, and already are, revolutionizing agriculture around the world. These technologies and business model innovations are coming to Australia. As we build an agtech ecosystem here, we have the opportunity to harness (or harvest) the potential of our entrepreneurs, and build capacity for entrepreneurship across the industry. Though I don’t believe everyone can be an entrepreneur, I do believe anyone can; entrepreneurship is a particular skillset and mindset, and it can be learned.
I’m committed to the vision of Australia as a global leader in agtech, and in 2018 I’ll be working to leverage Australia’s competitive advantages, bring farmers into the fold, and build a founder-friendly support pipeline to make this a reality. Who’s in?
Tenacious Ventures Management Pty Ltd (CAR 001275760), Tenacious Ventures Management Partnership, LP (CAR 001298484), Tenacious Ventures Fund II Management Partnership, LP (CAR 001298483), and Tenacious Ventures Fund II Staple Co Pty Ltd (CAR 001298487) are Corporate Authorised Representatives of Sandford Capital Pty Ltd (ABN 82 600 590 887), Australian Financial Services Licence No 461981, and are authorised to provide advisory and dealing in connection with investments to wholesale clients only.