H Tru-Test’s weighing and tagging systems collect livestock data (Photos courtesy of Tru-Test)
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developments in agtech with an eye toward introducing new technologies into its portfolio companies. “When we think about agtech, we don’t think about it as a revolution. It’s just incremental, slow, 1 or 2 percent gains on what are big production systems,” says Daniel Masters, a managing director with the firm. Among AGR’s portfolio companies is New Zealand-based Tru-Test, which helps improve farm productivity through livestock tools and systems. The company’s wide-ranging products include electronic identification systems to help farmers track herds using an online management tool, and weigh scales to measure and spot problems among individual animals. Electric fences, milk tanks and milk cooling systems are among its other offerings.
PROMISING INNOVATION Daniel Masters AGR Partners
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Agricultural technology companies that ultimately attract private equity investment will be those with offerings farmers can actually use. Millions of dollars have been invested in information and data retrieval technologies, yet 40 percent of rural Americans lack access to
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high-speed internet, notes Integris’ Seese. That makes seed technologies or hydroponics, for example, potentially more useful than drones or farm management software. “Farmers have to adopt these technologies and show them to be sustainable. That’s when private equity money will start flowing in,” Seese says. Crop technologies may be among the most promising for future private equity investment. Startups in this category raised $523 million across 61 deals in 2016, according to AgFunder. Among them are environmentally friendly pesticides and fungicides, known as biologicals, which can help protect crops from insects and weeds, increasing yield while making it easier to stay organic. Also included are technologies like gene editing and techniques to enhance soil to improve crop growth. Another technology disrupting agriculture is robotics. Startups like GV-backed (formerly Google Ventures) Abundant Robotics, which developed an apple-picking robot, are using these technologies to tackle complex tasks, or to act as a substitute for human workers amid minimum wage hikes and immigration restrictions.