GAI News Agtech Intel Question of the Month Wrap-Up – January 2019
Recently, INNO-3B, a tech company that develops efficient, high-tech growing systems for vertical farming operations, raised US$4.5 million in Seed funding. In your opinion, do you see vertical farming and the tech that supports it dividing into two separate investment channels?
I suppose that the responses from this question fall into what I would expect when asking about a development that is just beginning to show hints of emergence.
A solid 50 percent of our respondents stated that vertical farming and the tech that supports it will definitely divide into two separate investment channels. As the vertical farming industry matures, specialization will only become more pronounced, leading to farmers growing, and tech companies taking over the development of the systems supporting that endeavor.
Meanwhile, the second 50 percent of respondents were split almost evenly:
Twenty percent stated that vertical farming and the tech that supports it may split into two distinct investment channels. As production scales up, there is a good chance that growers will be more willing to outsource or partner on the development of the tech involved.
While 30 percent stated that there is a negative chance that the two will split into separate bonafide investment channels. The varied goals and business models of each vertical farming operation will limit the growth able to be achieved by tech companies looking to supply the framework.
Although it seems that we are collectively on the fence on this question, there has been more than one deal this month that indicates a growing chance that vertical farming and the tech that supports the industry will indeed divide into two distinct investment channels.
In the early days of the month, Agtech Intel reported that INNO-3B raised US$4.5 million in Seed funding from a host of Canadian institutional investors.
Headquartered in Quebec and Ontario, INNO-3B designs and manufactures innovative robotic solution platforms for the indoor vertical production of high-density crops. The company offers fully automated, scalable, remotely monitored, and controlled growing systems that can reduce greenhouse gas emissions generated from vertical agriculture. Its systems can be established in any location, whether it be urban or rural, and the company also offers deep agronomic knowledge and support through its in-house agronomic expertise.
Two weeks later, UK-based aeroponic tech developer LettUs Grow announced it had raised funding totaling £1 million (US$1.3million) from a combination of private and public backers.
Founded in 2015 LettUs Grow has designed a patent-pending aeroponic tech system that has shown to produce leafy greens, salad crops, and herbs at a growth rate that is 70 percent above existing solutions. Through its platform, crops are grown with their roots suspended in a nutrient-dense mist, resulting in growth rates that surpass conventional hydroponics, produce predictable and consistent yields without the use of chemicals, all while using 95 percent less water compared to traditional farming.
And although not directly associated with vertical farming per se, on January 25, Agtech Intel shared the launch of a $30 million cannabis tech fund being launched in partnership by Israel-based global investment platform OurCrowd and U.S.-based 7thirty Opportunity Fund – a development that reflects a focus on the tech associated with indoor production.
It is understood that the funding rounds mentioned here are Seed rounds, and are not yet to the scale that would make those in the investment field stop and take notice. However, they do indicate the beginnings of investors seeing vertical and indoor farming tech developers as being worthy of capital in-and-of themselves.
I see our respondents’ views aligning with what the deals indicate. Although, as a whole we are on the fence, a full 70 percent of respondents believe that the two activities of vertical farming and the tech that supports it, are either possibly, or definitely dividing into two distinct investment channels.
Stay connected with Agtech Intel throughout 2019 as we see if this trend gains momentum in the coming months.
-Lynda Kiernan
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