Welcome back to the Agri Fintech Newsletter!
This Issue I delve into:
🧐 Thoughts on Investment into Agri Fintech so far in 2022
🗞 Relevant News from Leaf, Oxbury Bank, Modern Acre NFT's, Morningstar AgFintech event.
Agri Fintech Investment so far in 2022
I have recently moved all my Agri Fintech activities into a new company called Graze and will use this to further develop the Agri Fintech ecosystem through advisory work and testing ecosystem propositions with companies in the Agritech, Agri Fintech and Fintech sectors.
I will touch on this more at a later stage but one of the first things I wanted to do was map out the Agri Fintech investment landscape and share this in report format with data running back to 2016. This will be coming in the next few weeks as I finalise the content and formatting.
However, I have the data ready for Q1 of 2022 and I'm too excited to keep it to myself for another year, so thought I would share with you all in this Issue as it is super exciting.
- 26 Investments
- $451m invested
- The largest round was Sayurbox Series C for $119m 🚀
- The smallest round was an Angel round for AgroFides, a fledgling US based company investing in West Africa - $55k
Lets delve in to the detail and I'll give some key take aways as I see it. 👀
1️⃣ $$$ Up and to the right 🤑
In 2021, Agri Fintech companies raised a chunky $1.6bn. That is an astounding amount and I will delve into that later in my Report.
However, Q1 of this year as kept up that pace at least on annualised basis. $451m each quarter would be an excellent performance but I won't be foolish enough to predict that continued pace of investment as funding markets have paused for breath.
But it is interesting to note that in the same period last year companies raised $186m, which demonstrates a 2.2X increase year on year.
What is possible?
Although, VC investment has slowed, I still expect some large rounds to happen later this year as I do know several companies who are in the market or going to market later this year with rounds that will be $50m+.
Plus there is also a major raise happening for Tingo ⤵️ who are attempting to uplist to the NYSE. A $500m raise might be an outlier in the world of Agri Fintech, but every little helps. 😉
2️⃣ Emerging Markets, Emerging Fintech 🌍
The top 5 rounds accounted for $296m or 66% of the total.
Of these only AcreTrader was US based ($60m), with the others taking place in to so called 'emerging economies': Sayurbox, Arya ($46m), Apollo Agriculture ($40m) and FarMart ($32m) all based in emerging markets. Emerging indeed!
This balance and variation is very exciting as the sector grows. When I look at older data in my upcoming report, some familiar names pop on a regular basis such as Indigo and FBN, so it is interesting to note more diversity in companies, region and business model in the most recent data.
3️⃣ It is still early ⏰
Sayurbox is the only Series C so far this year and the latest stage fundraise of them all.
There are 4 Angel and Pre-Seed rounds, totalling $515k but with some data missing, so I have excluded this from the graphic below.
6 Seed rounds raised $20m total 🔥. That's a $3.3m average and a range of $1m (Mozare3) to $6m for AgriAku in Indonesia. They are not cheap.
Similarly there were 7 Series A rounds, complemented by 6 Series B.
4️⃣ Platforms dominate as a category
Platforms accounted for an incredible 80% of funding in this quarter. This may sound unsurprising, but this has increased dramatically from 2021 and even more so since 2020.
The other surprise in these numbers is the Sustainability category, which only raised $14m (defined as companies which are building specifically for this segment). This was between two Carbon related transactions, Nori and eAgronom who both raised Series A of $7m and $7.3m respectively, which was still at the lower end of the Series A range.
In relation to the Sustainability category, I have been selective about what I include. However, if you want a great reference point on Climate Fintech as a whole, this report from CommerzVentures in Germany is outstanding. They are expecting a lot of growth in this sector and I also expect more activity in this as an Agri Fintech category over time.
What is not reflected in the data?
I love data but what is not included here are the many conversations I have with early stage entrepreneurs who are quietly building, one who has just done a management buy out of a small agtech to transition to fintech (Yip!) or are figuring out the best way to build a marketplace in their own part of the world.
The common thread is a person, or team with a connection to the food and agri sector and relevant tech or fintech experience.
Hopefully, we will start to see some of these projects trickle into the data in coming years, pointing to an evolution further down the line.
I've covered a lot of the funding news above so I just mention two notable examples below, which missed the cut off for my data above, along with a few of the weird and wonderful things I came across recently.
⦿ Leaf raised a $5m convertible note to expand their universal API for farm data.
👏 Leaf have done an exemplary job of promoting the data agenda in the Food and Agriculture sector. I look forward to hearing more from them post raise.
⦿ Oxbury Bank, who featured in my last issue on Neobanks, have closed their Series C of $41m. This has not been included in my analysis above.
They have also acquired their software provider Naqoda, which now gives them control over their IT suite and strategy. This is definitely one to keep an eye on 👀 as they expand their SaaS type model on a global basis.
⦿ The Modern Acre have launched the Co-Op, an Agtech community gated by NFT.
SO this is not strictly Agri Fintech but several people have reached out to me informally for a 'view' as NFT's - and Crypto generally -carry a lot of financial connotations.
🚨 Disclosure : I have signed up for the presale.
I think the premise of this is interesting and I think it is very smart to limit the number of members to 210. A lot of Web3 community projects are noisy in my 'view' so I'm curious to see if the Agtech community can pull together a tight knit group with meaningful events thrown in. So for me, personally, it is interesting.
⦿ Ag Fintech and Sustainability symposium is happening (or happened depending on when I get this out!) in Chicago and on Fintech.tv on Monday 4th April.
Despite the buzzword bingo on the poster (below), the fact this is happening is exciting as it looks like they will discuss opportunities for climate focused investors ('aka asset flows') in the food and agriculture sector.
I will also say this. 3 of the speakers subscribe here and I suspect they will be the best informed (You know who you are - Thanks! 😁)
Please let me know how this goes if you attend in person or online!
AND that is all for this Issue. Again, I have dropped the Profile section as there is a lot of news discussed above.
Please do share the Newsletter and spread the word!
Have a productive week. dzfvadfv