Global investment in agriculture and food technology startups reached $US26.1 billion in 2020, a 15.5 per cent year-over-year increase, according to new analysis by AgFunder.

Investors are looking further upstream and supporting more farming and food innovation than ever before, as COVID-19 highlighted the importance of resources and supply chains.

Australia’s Sparklabs Cultiv8 was among the world’s most active agtech accelerators, according to the analysis, making 12 major investments in 2020.

Agrifoodtech is a small but growing part of the technology startup investment world. Solutions range from drones and IoT to monitor weather and harvest to the machine learning and software used to manage the new data sources.

AgFunder a VC working in the sector tracked US$26.1 billion worth of investments in the sector last year and says the total could be as high as US$30 billion as more deals come to light.

“The Covid-19 pandemic has highlighted the importance of efficient supply chains and alternative ways of growing, processing, transporting and selling food to consumers,” the 2020 report says. 

“Innovations in the midstream – between farmer and retailer – got a much-needed investment boost.”

In total, there were less funding deals for Agrifoodtech startups in 2020 but the amount of money invested still rose because of significant growth in late stage deals, according to the report.

For example, Impossible Foods raised more than US$700 million last year, bringing the plant based meat company’s total funds raised to $US1.5 billion since its founding in 2011.

The majority of Agrifoodtech funding last year occurred in America. US startups raised $US15.45bn in 2020, a 56 per cent YoY increase and 30 per cent YoY rise in number of deals.

Globally, the money is almost evenly split between upstream investments – like farm management and agtech – and downstream – things like restaurant and retail tech as well as food delivery. 

However, for the first time upstream investment surpassed downstream and grew 68 per cent year on year.

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