5 Themes from Sydney’s Second AgTech Meetup

March 10, 2017

This week’s NSW AgTech Meetup featured Francisco Caffarena, investment manager at BridgeLane and co-founder of AgTech startup SproutStack. Fran has an ag engineering and finance background, and now wears the dual hats of investor and entrepreneur. Several themes emerged during our QnA with Fran- here are a few:

  • VC in Australia is improving, but AgTech, despite tons of events and a recent exit, has not (yet) taken off for VCs in Australia. Fran suggested that risk appetite is increasing, and VCs are indeed raising more capital. But even BridgeLane’s VC arm, despite having a portfolio of various tech startups, has not yet found a compelling AgTech opportunity. In fact, they’ve taken things into their own hands. About a year ago, BridgeLane formed SproutStack, an urban agriculture venture using shipping containers and hydroponics, out of their own internal “Startup Studio”.
  • The government has a role to play to improve commercialization outcomes, but it’s not clear how quickly that will happen. Though government initiatives are generally slow, it is promising to see so much government support for innovation in agriculture over the past 18 months. From the Ag Competitiveness White Paper to the Innovation Agenda to CSIRO’s On Accelerator to the recent Food Agility announcement, things are happening and the government is supportive.
  • Incubators and accelerators can help de-risk startups, but they’re not necessarily a primary source of deal flow for VCs, according to Fran. And it’s a good thing we’re not dependent on these models, given the recent news about Pollenizer closing down. For startups looking for capital, Fran suggests networking events, and advises entrepreneurs not to be shy. Investors are looking for opportunities, so startups need not be afraid to pitch. Co-working spaces like Tank Stream Labs, the co-working space owned by BridgeLane, can also help startups connect into the investment community. For example, if one company raises money, everyone in the co-working space will hear about it and can ask for an intro when they’re ready.
  • Hiring is a challenge for Aussie AgTech startups. This is true for startups in general, but is especially true in Australia where taking risks is not embedded in the culture as deeply as in, for example, Israel. When SproutStack was looking for an MD, they posted the job to LinkedIn and reached out to their networks for recommendations. Fran suggested that recruitment firms can help in some cases, but the fee structure doesn’t lend itself to startup’s typical budgets. If you are looking for a job in AgTech, Meetup sponsors SproutX and AgriDigital are both hiring!
  • There’s lots of interest to get into AgTech, but folks are struggling to know how to get started. Fran suggested looking to emerging technology areas- like robotics and big data- and then thinking about how they can apply to agriculture. And of course, it’s critical to actually get out and see how farming works, talk to real users, and discover firsthand where the opportunities are arising. As a final thought for those looking for inspiration, Fran suggested Farmers Business Network, a U.S. AgTech firm that’s disrupting the retail space. Google seems to think this so too, as their venture arm just led their $40M Series C.

It’s been great to see this community of entrepreneurs, curious techies, investors, and yes, a few farmers, growing as the energy for innovation in agriculture and food systems increases in Australia. Hope to see you at the next #agtechSYD!