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Beautiful hummingbirds are one of my favourite things about Costa Rica. iStock

Letter on the way to Latin America

June 7, 2023

Ok, I’m not actually on my way right now but in a couple of weeks’ time, together with our co-author and partner SP Ventures, we will be launching our first-ever Latin American agrifoodtech investment report in Saõ Paulo, Brazil. I’m excited.

Latin America feels somewhat close to home with close family members living there for years and having traveled the region quite extensively (mostly pre-kids!). In fact, my first job in agriculture was on my uncle’s very progressive organic strawberry farm in Costa Rica back in the early 2000s!

From an agrifoodtech perspective, the region is an interesting dichotomy. 

On one hand, you have the highly advanced and productive large-scale agricultural organizations of South America – it is, after all, home to the fourth largest food producer and second biggest importer in the world, Brazil, and represents 18% of global food exports. And on the other hand, most if not all of its countries are still considered developing countries, with a smallholder farming population of 14 million producing 50% of the region’s food.

Policy-wise you also have that dichotomy. Countries like Costa Rica are faaaar ahead of the curve in terms of climate awareness and action – perhaps that’s why my uncle was always ahead of the curve too, not just with his climate-friendly businesses but also with technology adoption. Then you have Brazil’s infamous policies – or lack thereof – around deforestation.

But what this dichotomy presents is an interesting melting pot of advancements with a lot of white space and opportunity. The advent of digital technologies in the region’s agribusiness sector has seen many of the larger players embrace new tools and experiment with them – as BASF’s Latam digital director recently told me. Rushing to serve these big players, innovators have jumped on emerging challenges, such as financing, by creating some of the best ag fintech tools out there. And by testing agtech startup business models in the early days, the bigger ag players are hopefully paving the way for accelerated adoption of tech tools by the smaller producers.

Of course, in many ways, it’s crazy to group such a diverse group of countries together like we so often do. But with a growing number of venture funds focusing on the region as a whole, and with the relative proximity and similarity in the makeup of their farming communities, it can be helpful to do so.

Latin America is also close to home for AgFunder, AFN‘s parent company. Not only are two of our investment team from the region — Manuel Gonzalez from Mexico and Sofía Ramírez from Chile — but we have been backing startups in the region since we started investing in 2018.

Brazil’s Solinftec, an automation and artificial intelligence startup, was one of our first three investments. At the time it already had 50% of Brazil’s sugarcane industry as a client. That number is closer to 90% today and the company has successfully landed in the US with an expanding product portfolio. Later we invested in the seed round of Jüsto, the Mexican e-Grocer committed to establishing an environmentally-conscious supermarket by minimizing waste, removing intermediaries, practicing conscious plastic usage, and leveraging artificial intelligence to optimize demand and minimize shrinkage. Currently, they serve customers in Mexico, Brazil, and Peru, maintaining shrinkage levels below 3%, which they say is less than half of the industry average.

We’re always on the lookout for more investments in the region and are proud of our partnerships in Latin America with SP Ventures and GLOCAL.

AgFunderNews has been covering the region as much as possible from our bases in the US, Europe and Asia, with some help from our amazing venture partner Sofia Ramirez who wrote this great mini guide to Latin America agrifoodtech in 2020 and collaborated on a market map for the region.

But alongside our new report, we want to expand our media coverage of the region further with on-the-ground reporting and data gathering. So if you know of any budding freelance reporters or data analysts in the region, please get in touch at [email protected].

Don’t miss our inaugural Latin America AgriFoodTech Investment Report coming out on June 15, by signing up for our newsletter. And if you’re going to the World AgriTech South America Summit in Sao Paulo later this month, make sure to say hi as I will be there! And if you haven’t booked yet, you can get a 10% discount on your ticket with the code FUNDFRIEND.

Editor’s Note: Louisa Burwood-Taylor is managing editor and head of AgFunder’s news & research community.

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