A strong and growing start-up community is important for the success of the UK agri-tech sector. Although funding is vital so equally is access to the end-user community, particularly as in most cases the founder or innovator doesn’t have an agri-tech background but is someone who can see the market potential in the sector.
End-user engagement via the Agri-Tech East cluster network can help ensure the innovation journey and route to market has the greatest chance of success.
Over the last few months we have seen some really interesting early stage activity.
We have met start-ups developing technology-based platforms to help with on-farm decision making, which has included tools to predict crop yield potential in different fields and calculators to establish the financial impact of the CAP greening policies. There are online platforms for global agri-tech value chain mapping and tracking, and we are also seeing a range of ideas designed to help protect crops against pests and diseases.
Although agri-tech is in its infancy, compared to the established high-tech or biomedical sectors, the signs are that it is set to follow. The benefit that agri-tech entrepreneurs have is that the infrastructure designed to support start-ups is already in place.
We are fortunate in the east of England to have access to a vibrant and energetic early stage investment community, as well as other public/private investment tools to encourage commercialisation of agri-tech related ideas.
Angels or dragons – call them what you will – early stage investors are a vital element of a successful cluster ecosystem. Not only do they contribute financially, but the right investors can provide mentoring, advice, guidance and access to networks to help make the difference between success and failure.
Sources of finance include:
- Iceni Seedcorn Fund
- Low Carbon Innovation Fund managed by the Adapt Low Carbon Group at the University of East Anglia
- Cambridge Angels
- Anglia Capital Group – the new sister chapter to Cambridge Capital Group, set up to invest in agri-tech and bio-sciences in East Anglia
- New Anglia Capital
- Institutional investors such as the Rainbow Seed Fund, and Wheatsheaf Investments, among others.
What all these investors have in common is the desire for high quality deal flow, at the right scale, and with a team and technology ready for investment.
The business plan and model, the innovation itself and, importantly, the exit strategy also have to be right. Again, we are fortunate to have a range of support mechanisms in place locally to help maximise the chance of success.
Support programmes include:
All of these offer support programmes to help innovators refine their business plan and become investment-ready – most are free of charge or have a small fee associated with them.
The so-called “open innovation” model adopted by the high-tech and pharma industries has potential also for agri-tech. Over time the number of small businesses in the sector will increase, creating opportunities for large agri-business to partner, collaborate and, potentially, acquire (that famous exit strategy again) these companies and ensuring a flow of capital through the industry.
Agri-Tech East is focussing strongly on connecting the start-up and investment communities, with the inclusion of end-user growers and farmers to help inform and accelerate the journey of a new innovation to market.
We believe this is an important foundation for a successful sustainable agri-tech cluster making a real contribution to the UK economy.