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From the Entrepreneurs' Garage to the Dinner Table

Jonathan Ortmans on June 30, 2014 Source: Policy Dialogue on Entrepreneurship

Agtech 

Entrepreneurs around the world are driving a new agricultural revolution to address the world’s dual food security and environmental challenges through sustainable agriculture technology, or “AgTech”. We need many more of them.

As I celebrate the July 4th week at a family home nestled in a valley surrounded by farmland, I am realizing how little attention I have dedicated on this blog to agriculture. Global demographics indicate that food demand is expected to increase 70 percent by 2050, with a parallel increase of as much as 100 percent in food prices. Environmental challenges and urban trends all indicate that farmland is not the key part of the equation to tweak. Clearly, the global agriculture system is under pressure. Enter AgTech. It is a fast-growing industry, but it needs more entrepreneurial innovators to step in.

That is the conclusion of a study by the Donald Danforth Plant Science Center and the Kauffman Foundation. In "AgTech: Challenges and Opportunities for Sustainable Growth", author Suren G. Dutia identifies untapped opportunities for innovation in this growing economic sector, which encompasses a wide range of areas such as crop and animal production, processing, and manufacture and distribution. Based on data analysis of 900 AgTech companies, the paper shows that despite its size, AgTech has seen little investment relative to sectors such as renewable energy.

Innovations in agricultural practices are not a new phenomenon. Over the past 50 years alone, they have allowed worldwide food production to triple without having to increase the amount of cultivated farmland significantly. Today, the dual challenge of increasing food production for a growing population (9 billion people expected by 2050) and reducing environment stress also presents an opportunity to introduce technological innovation in economic sectors previously neglected in traditional startup hubs.  

As the International Food Policy Research Institute (IFPRI) recently showed, the reality is that no single agricultural technology or farming practice will provide sufficient food for the world in 2050.

In the United States, Dutia and his research team identified the American heartland as an ideal hub for new AgTech ventures because the region is already an epicenter of global agricultural activity, producing 27.2 percent of the world’s corn and 29.75 percent of its soybeans. Others claim that the California Bay Area could be the potential epicenter of specific sectors within the AgTech industry, such as agricultural biotechnology.

At the global level, opportunities abound while national boundaries become less of a determinant. Take Croatian entrepreneur Matija Kopic, Founder & CEO at Farmeron, a cloud-based farm business management software company with a vision to integrate different disconnected farming data sources, allowing producers to become more efficient managers. A 2010 graduate from the University of Zagreb, in 2012 he was decorated with the Presidential Order for Innovation by the President of the Republic of Croatia. 2012 was also the year that Farmeron raised $1.4 million in seed capital from both angels and venture capital firms, and secured key mentoring through programs like Seedcamp in London and 500 Startups in Silicon Valley.

We cannot talk about rock stars in AgTech without mentioning Israeli researchers driving crop-productivity enhancing patents. Inspired by the previous wave of Israeli pioneers in the field of intense agriculture and drip irrigation that contributed to agricultural development throughout the developing world, entrepreneurs behind Tal-Ya and other ventures are looking at new water management solutions. Will Tel Aviv maintain its status on the global ecosystem chart?

While AgTech clearly offers the best way forward to navigate a path between food demand and environmental impact, policymakers should tread wisely. Entrepreneurial innovation must be driven by entrepreneurs and investors to achieve the critical, multi-pronged goals we face. With this in mind, governments would be wise to breathe life into the AgTech entrepreneurship sector by removing unnecessary roadblocks and education. For example, solving R&D commercialization bottlenecks would unleash pent up technological solutions. As the Larta Institute explains, commercialization in itself means “navigating a long and winding road”. Policymakers should not add that already risky process for entrepreneurs.  Other intersecting areas are incentives for private R&D and investment in sustainable agriculture technology.

Many governments understand this enabling role and have avoided programs that micro-manage entrepreneurial innovation, and celebrate startups that help feed their population without sacrificing resources that will help feed the next generation.

The United States government is seeking to create an international community of AgTech entrepreneurs focused on technologies for smallholder farmers. Its AgTechXChange initiative offers various platforms for innovators to present their agriculture technologies to potential partners and investors, investors, donors, and other funders to share funding priorities and solicitations that target agriculture and technology commercialization, and for all to network with others interested in sharing lessons and trends.

Entrepreneurship practitioners are also seeking to catalyze an AgTech community across national boundaries. The Future Agro Challenge (FAC), part of the Global Entrepreneurship Network created by Global Entrepreneurship Week, launches this year as a worldwide championship for innovators in farming and business practices across subfields such as water management, production conservation, instant data access, crop diversity and more. The competition was created and is being run by Industry Disruptors – Game Changers (ID-GC), an organization working to foster innovative entrepreneurship in the Mediterranean region and the Balkans. ID-GC is currently receiving applications from local organizations to select the most promising startups in their country to compete in the international Future Agro Challenge finals in Athens, Greece during Global Entrepreneurship Week this November. We should welcome this infusion of startup culture too often just associated with tech entrepreneurs into agriculture.

As the Danforth Center and the Kauffman Foundation stated in their recent AgTech report, entrepreneurial innovation in agriculture brings the intangible and weightless feel of the recent information technology revolution right back to its inescapable physical and human foundations. It also brings entrepreneurship right back to our dinner tables.

Category:  Global  Tags:  Suren Dutia, Danforth Plant Science Center, IFPRI, Farmeron, Future Agro Challenge, GEW

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