Roundup of AgTech’s Investments and Venture Capital Outflows in Q3 2021

The last quarter set a record for venture capital investments in AgTech startups. A total of $4.016 billion was raised by 171 startups in the third quarter. To put that into perspective, last year AgTech companies raised a total of $5.15 billion, so that’s a huge gain in a single quarter. In the first three quarters of 2021, 441 AgTech startups raised over $8.3 billion.

The pace of exits from venture-backed AgTech-focused startups slowed in the last quarter compared to the first half. There were six exits announced last quarter, four through mergers and acquisitions and two through a public listing. There have been 31 releases so far in 2021, up significantly from 14 last year.

Here’s a breakdown of the amount of venture capital raised in each AgTech sector, as well as some of the startups that have raised the biggest funding rounds. Finally, releases from the last quarter are also listed.

Food / feed / fuel ingredients

A total of 50 startups in the pet food and fuel ingredients category raised $1.813 billion in capital last quarter. Companies focused on replacing animal products continue to raise huge amounts of capital. In addition to plant or cell protein startups, several insect production companies raised venture capital in the last quarter. However, there is a slowdown in startup funding in the environmentally controlled agriculture space.

The three largest deals in this category include a $350 million round for perfect daya biotechnology company replacing dairy products with fermentation, a $350 million funding round for Nature discoverya company that uses fermentation to turn mushroom proteins into food products, and a $235 million round for NotCoa company offering plant-based milk substitutes.

Value chain and logistics

A total of 57 startups focused on the value chain and logistics sector raised $1.046 billion last quarter. Companies that reduce food waste and help deliver local produce continue to attract investor attention. Additionally, startups launching robotic harvesters have caught the attention of investors. Finally, several farm-focused climate monitoring startups have also raised capital.

The three largest deals in this category include a $250 million seed round for Apeel Sciencesa company that makes a plant-based coating to extend the shelf life of fruit, a $225 million funding round for Misfit Marketa subscription box service for organically grown products and a $120 million round for GrubMarket, an online marketplace that delivers local food directly to consumers. Misfits Market has made this list two quarters in a row. The company raised $200 million in April this year.

Crop Protection/Production

Twenty-eight startups related to crop protection or production raised $773 million last quarter. Companies bringing new biologics to market were the big winners last quarter.

The three largest deals announced in the last quarter include $430 million raised by Rotate biographya company making bio-fertilizers from microbes, $116 million raised by AgBiomea manufacturer of bio-based pesticides from microbes, and $45 million for Healthy farminga developer of bio-stimulants to induce plants to increase nutrient uptake.

Digital farming

In the last quarter, 20 digital agriculture startups raised capital, representing $226 million in investments. Investors here have remained focused on digital agronomy, farm management and yield forecasting software.

The three biggest deals announced so far this year include $100 million for Semiosa crop management software platform for fruit trees, nuts and vines, $30 million for InputControlan agricultural software platform helps specialty crop growers manage pesticide applications, harvesting activities and field operations, and $23 million for Ceres Imagingaerial imagery to help farms, orchards and vineyards optimize irrigation.

Animal Health/Nutrition

A total of 16 startups with technologies focused on improving animal health and nutrition raised $157 million last quarter. Many investments were made in the third quarter focused on aquaculture.

The three biggest deals announced last quarter were a $75 million round for Embarka company that makes DNA testing kits for pets, a $24.6 million round for Protein Pharmaceuticalsa company marketing microbes to replace the need for antibiotics in livestock, and a $20 million round for XpertSeaa software company specializing in technology and financial solutions for the aquaculture supply chain.

Exits

There were two startups with AgTech products that became publicly traded companies last quarter, both by PSPC Mergersand four companies exited through mergers and acquisitions.

Ginkgo Bioworks, a synthetic biology company that produces bacteria for industrial applications, began trading as NYSE:DNA in September. Ginkgo’s platform is used by several other AgTech companies, including FoodWorks pattern which manufactures meat and dairy substitutes by fermentation, and Joyn Bio, a joint venture between Ginkgo and Leaps by Bayer manufacturing organic crop protection products. September also saw Benson Hill start trading as NYSE: BHIL. The company uses data science and machine learning with biology and genetics to produce new crop varieties focused on the plant protein market.

With respect to mergers and acquisitions transactions, Agmondean agricultural management software platform, was acquired by Semios for an undisclosed amount in August. As mentioned earlier, Semios raised a $100 million capital raise last quarter. payAgria market place for the agricultural value chain, was acquired by Suumaya Industries for an undisclosed amount in August. Gaia Foodsa cultured meat start-up, was acquired by Shiok meats in August for an undisclosed amount. To finish, Bear Flag Roboticsdeveloper of autonomous tractors, was acquired by John Deere in August for $250 million.



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