Agriculture and innovation reaches new heights, in part fueled by Covid
AppHarvest’s impending IPO is a good sign not only for the agtech sector, but for the growing number of women entrepreneurs in this space
Agtech, the marriage of agriculture and technology, recently hit headlines with word of AppHarvest’s impending IPO. AppHarvest is an agtech startup that builds high-tech greenhouses with innovations that support water and energy conservation, including what is may be the world’s biggest greenhouse.
The company’s high profile investors include domestic lifestyle entrepreneur Martha Stewart and Hillbilly Elegy author J.D. Vance. Over the summer celebrities Oprah Winfrey and Katy Perry invested in Apeel Sciences a California-based food bio company that produces a coating that extends the life of produce. Earlier this month Syngenta announced its acquisition of the Italian biotech company Valagro.
Could agriculture be seeing the start of a trend or are these indications of a coming of age of agtech?
The recent attention on agtech is significant for a sector that to an extent remains an enigma even to farmers themselves. Agtech, which developed over the past seven years, includes any technology or innovation created to help farmers operate more efficiently namely automation, robotics, sensors and data analytics. Under growing challenges the largest being climate change, growers also face the pressure to feed a global population estimated at 9 billion by 2050.
The wave is in part driven by Covid-19, which has brought food to the forefront of global attention. The pandemic has spotlighted the need to access to fresh food along with big impact issues surrounding food safety and food waste. Growers, who once questioned the efficacy of agtech, are now seeking innovation to tackle problems such as severe labor shortage, water and land supply shortage and the loss of arable or farmable land.
Industry experts aren’t surprised by the rising interest in agtech from growers.
“The pandemic has laid bare the weaknesses of the current food and ag supply chain that can be addressed through innovation,” says Pam Marrone, the founder of Marrone Bio Innovations based in Davis, Calif. that creates bio-based products for pest management and plant health. “Furthermore, there is recognition that ag can become more climate smart so there are large initiatives and investments dedicated to reducing the carbon footprint of food and ag production. The rise of the ESG (environmental, social, governance) investor is driving investment as well.”
Miku Jha, the founder of AgShift an agtech startup that produces machines that use artificial intelligence to grade the quality of specific produce, says Covid has heightened awareness of the need for automation to provide more accuracy and efficiency in the food systems.
“The positive [out of the pandemic] is food companies now have this awareness to augment the manual processes with tech and innovation. There is a heightened awareness of that because of what is happening,” says Jha who has worked with companies included Driscoll’s.
Growers, both conventional and those adopting organic practices, are turning to agtech companies for answers.
Diane Wu, the co-founder of Trace Genomics a San Francisco Bay Area agtech company that produces soil testing technologies, says interest and business continues on the upswing. Trace was launched in 2015 and uses DNA sequencing of soil to help growers and agronomists make better decisions with their crop plans. Among farmers there is now a “recognition that the soil is alive.” “I think farmers are seeing investing in soil health gives you that natural resistance to diseases,” Wu says.
More growers are examining their existing growing practices and are using soil testing technologies and innovations with the goal of improving their soil quality.
Dennis Donohue, executive director of the Western Growers Center for Innovation and Technology, sees continued opportunities for agtech startups focused in soil health. The Center based in Salinas, Calif. serves as a business center for agtech and agbio startups.
“It all speaks to the climate discussions—there’s a lot of new dynamics in place when it comes to regenerative agriculture and soil and that is a sweet spot in the conversation,” says Donohue, noting that indeed there may be more AppHarvest like deals in the pipeline.