As EcoTech Capital MD Adam Bergman recently noted, a lack of exits has created a “vicious cycle” in agtech: limited investable capital as existing funds hit the end of their life and struggle to raise new capital, and few new funds emerging as LPs shy away from a sector with weak returns.
Against this backdrop, Pitchbook’s latest report asks the obvious question: What does a successful VC-backed agtech investment actually look like?
According to authors Alex Frederick and Caleb Wilkins, who analyzed 1,197 VC-backed agtech outcomes as of Dec 31, 2025, VC-backed exits remain “concentrated in specific sectors, with crop inputs & enhancements, precision ag software, and select animal ag health companies generating the strongest risk-adjusted outcomes.”
Notably, the biochem and inputs space is a sound bet, they claim: “Regulatory pressure on synthetic pesticides is accelerating the shift to biological crop inputs, with the market forecast to roughly double by 2030.
“Bayer, BASF, Syngenta, Novozymes, and Corteva are repeat acquirers who have publicly named biologicals as a strategic priority, giving investors in this segment a pool of well-capitalized, strategically motivated buyers that no other agtech segment can match.”
According to Pitchbook:
Capital is consolidating around the strongest players: “Median pre-money valuations are at record highs even as disclosed deal counts have dropped 70% from their 2021 peak, reflecting capital concentrating in the most credible teams and business models. Median valuations and deal sizes are rising not because the market is broadly improving, but because weaker companies are no longer being funded at all.”
Meanwhile, young startups, including AI-native agtech firms, “have received an influx of seed-stage capital from multistage funds, elevating deal sizes and valuations.” What we don’t know, says Pitchbook, “is whether investors can systematically identify” the best bets within this growing pool.
Where the smart money is: “Seed or Series A entry below $20 million pre-money, technology-supplier models rather than capital-intensive operators, total capital raised under $30 million, and exposure to segments with robust strategic and private equity acquirer pools.”
For LPs: Pitchbook recommends backing specialists with “concentrated portfolios, 10-plus-year or evergreen structures, biochem or precision ag expertise, and proven relationships” with strategic acquirers such as Bayer, Novozymes, John Deere, and Zoetis.
For GPs: With half of companies expected to fail (of 1,197 VC-backed agtech companies with known outcomes, 683 are confirmed failures and 372 exited without a disclosed valuation), “funds must secure enough ownership in the one to two outlier exits at $500m+ that will define performance and avoid late-stage entries at software-style multiples into businesses that are likely to exit at 6x revenue.”
Among the 2,533 VC-backed companies founded between 2015 and 2020, 152 have a confirmed exit and 345 are confirmed failures (as of year-end 2025). Of the 29 exits with disclosed values, nine exceeded $100 million, and one exceeded $1 billion.
$8.2 billion destroyed: VC-backed confirmed failures destroyed a known $8.2 billion in capital.
Quality not quantity: “What distinguishes top performers is not how many agtech companies they back, but whether they bring genuine domain expertise, segment focus, and acquirer relationships to each position.”
Agtech’s big exits – a mixed bag: Blue River Technology ($284m, acquired by John Deere), Granular ($300m, acquired by Corteva), and ClimateFieldView ($1.1bn, acquired by Bayer) were “clean strategic exits at disciplined valuations,” notes Pitchbook. Planet Labs ($2.7bn reverse merger) “generated strong returns for early investors.”
However, Zymergen ($3bn IPO), Benson Hill ($1.8bn SPAC), and GreenLight Biosciences ($1.2bn reverse merger) “went public at peak-cycle valuations and subsequently collapsed.”
Flawed tech or flawed business models?
Echoing a recent analysis by Eugen Kaprov, key failures in the sector have been less about technology than financing mismatches and broken unit economics, claims Pitchbook.
“The largest capital destroyers in this dataset built real technology. Bowery, Infarm, and Kalera built world-class controlled-environment agriculture systems. Ynsect built the world’s largest vertical insect farm. Benson Hill developed validated genomic tools. None of it was enough. Investors who lost capital in these companies did not bet on unproven science. They bet that commercial-scale unit economics would follow. They did not.”
Adam Bergman: focus on areas with ‘numerous active acquirers’
Adam Bergman told AgFunderNews that the agtech sector faces many challenges from technology development to product scale-up, distribution and farmer adoption.
However, the biggest barrier for most companies is their “inability to achieve positive unit economics and profitability at scale,” he claimed. “This has caused the three segments that have raised the most capital—alternative proteins, biologicals, and indoor farming—to experience much higher rates of bankruptcy and business cessation.”
Conversely, companies in areas that have been able to provide a positive ROI to farmers, including automation and robotics and digital agriculture, have shown a much quicker ability to achieve commercialization and a viable path to profitability, he said.
“Most exits in the agtech sector are below $350 million, which necessitates companies raising smaller initial financing rounds at more reasonable valuations, so that investors have the potential to achieve positive exits.”
During the past decade, there have been “almost no agtech exits above $1 billion and few IPOs,” he noted.
“This makes it more important for companies to focus on areas where there are numerous active acquirors, such as agrobusiness (ADM, Bunge, Cargill), animal agriculture (Merck, JBS, Tyson, Zoetis); crop protection (Bayer, BASF, Corteva, Nutrien, Syngenta, Yara); and equipment (AGCO, CNH, Deere, Yamaha), for the best opportunity for a successful exit.”
Dave Pierson: light at the end of the tunnel
David Pierson, managing director at Syngenta Group Ventures, added: “VC is a cyclical business and the agtech down cycle we’re crawling out of shows we’ve all learned some lessons and there is a light at the end of the tunnel. The ‘flight to quality’ that Alex Frederick’s data supports so well is a natural swing of the pendulum back toward a more disciplined focus on VC investment fundamentals, the critical importance of capital efficiency (cash is king!), and renewed emphasis on finding the path to profitability vs driving top line growth. ”
Valuations, meanwhile, are “getting realistic,” he said. “The agtech community is moving up the VC learning curve after a go-go decade of zero to very low interest rates. Despite the tough environment there are attractive companies with good deal terms for both management and investors.”
PJ Amini, VP ag investments at Bayer’s corporate venture arm Leaps by Bayer, told us: “It is always super useful to leverage an aggregate data set like what Alex has brought together to see an overall view of the ag market and provide a nice roadmap catering to the return profiles we’ve seen over the last decade. The guidance makes a ton of sense in light of the evidence provided and I look forward to seeing a few more positive exits come into play here in the near future.”
Further reading:
🎥 The good, the bad, and the ugly of agrifoodtech investing… in conversation with Adam Bergman
Leaps by Bayer’s PJ Amini on exits, epigenetics, AI-driven discovery and his ‘50% rule’
India will see IPOs in agritech before America or Europe, says Omnivore’s Mark Kahn
