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Agrifoodtech funding drops 12.5% YoY in H1 2024

July 3, 2024

Data Snapshot is a regular AgFunderNews feature analyzing agrifoodtech market investment data provided by our parent company, AgFunder.

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Agrifoodtech startups have raised $7 billion across 427 deals so far in 2024, according to preliminary data from AgFunderNews’ parent company AgFunder. This is down in both dollar amount and deal count compared to H1 2023, which saw $8 billion across 934 deals.

H1 2024 investment also includes an outlier mega-deal — a $700 million Series C raise from NYC-based food delivery startup Wonder — that slightly skews totals for the first half of the year. The next-largest round was a $425 million late-stage fundraising from midstream company Buyer’s Edge.

Rob Leclerc, founding partner at AgFunder, said the drop doesn’t surprise him at all. “Companies are going to run out of money and not a lot is getting funded,” he said flatly. “We need to be very careful about what we invest in unless we want to carry it.”

Median deal size H1 2023 vs. H1 2024

Series A Series B Series C Series D Debt Late Seed
2023 $7.5m $14.8m $23m $47m $40m $25m $7m
2024 $6m $15m $24.5m $31m $10m $29m $1m

How have investor predictions performed?

Back in February, AgFunder’s Global AgriFoodTech Investment report polled a number of VCs to get their thoughts on what to expect for 2024. Among their predictions:

  • 15% of respondents still believed alternative protein would get the most funding in 2024
  • Biotech and biological inputs were another popular choice, garnering 15% of the vote
  • Another 14% were betting on health- and nutrition-related startups
  • 12% said food delivery would be the best-funded category
  • 9% highlighted AI and climate startups

Funding by category for H1 2024 shows how these predictions stack up to the current reality.

The AgFunder-defined Ag Biotech category includes biological inputs as well as biotech innovations in a number of different areas of agrifood. This time last year, ag biotech startups had raised $782 million and would go on to raise a total of $1.9 billion for all of 2023 — a 34% drop from the previous year.

In H1 2024, ag biotech startups have already raised $1.7 billion, or nearly as much as they raised for the entirety of the previous year.

Innovative Food, the category made up of mostly alternative protein startups, is still one of the strongest categories as of H1 2024, with startups raising $828 million. Only Ag Biotech and In-Store Retail & Restaurant Tech ($1 billion) surpassed it in terms of top-funded categories.

Bioenergy & Biomaterials — one of only two categories that grew in 2023 — is performing strongly so far and will in all likelihood pass the billion-dollar mark this year.

Food delivery isn’t, as some said, the best-funded category (so far) but sits squarely in the middle of categories in terms of funding raised, at $758 million in H1.

More concerning is the lack of funding currently going towards farmtech categories, namely Ag Marketplaces & Fintech, Farm Robotics, Mechanization & Equipment, and Farm Management Software. How enabling technologies like AI impact these sectors moving forward is worth keeping an eye on as the latter becomes more deeply integrated into tools at the farm gate.

In keeping with previous trends, funding to former agrifoodtech darlings eGrocery and Novel Farming Systems continues to decline, though a robust appetite for eGrocery in India and a handful of other countries helped keep the category in the middle of the pack.

Nearly 40% of the funding for Novel Farming Systems came from a single raise from vertical farming company Oishii, a company that’s so far managed to buck most of the negative trends associated with its sector.

Agrifoodtech VC funding by category 

Category H1 2023 (USD)  H1 2024 (USD)
Ag Biotech $782m $1.7bn
In-Store Retail & Restaurant Tech $856m $1bn
Innovative Food $909m 828m
Bioenergy & Biomaterials $1.4bn $761m
Supply chain $534m $759m
Online Restaurants & Meal Marketplaces $271m $758m
eGrocery $887m $694m
Ag Marketplaces & Fintech $330m $513m
Farm Robotics, Mechanization & Equipment $505m $398m
Farm Management Software & Sensing $536m $365m
Novel Farming Systems $424m $336m

 

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