AgTech is the small but growing segment of the startup and venture capital universe that’s aiming to improve or disrupt the global food and agriculture industry.
As with all industries, technology plays a key role in the operation of the agrifood sector, a $7.8 trillion industry, responsible for feeding the planet and employing well over 40% of the global population. The pace of innovation has not kept up with other industries and today agriculture remains the least digitized of all major industries, according to McKinsey.
The industrial agrifood sector of today is also largely inefficient compared to other industries, with an increasing number of demands and constraints being placed on it. These pressures include a growing global population set to reach 9 billion by 2050; climate change and global warming; environmental degradation; changing consumer demands; limited natural resources; food waste; consumer health issues and chronic disease.
The need for AgTech innovation is greater than ever. This creates many opportunities for entrepreneurs and technologists to disrupt the industry and create new efficiencies at various points in the supply chain. Broadly speaking, AgTech startups are primarily aiming to solve the following challenges: food waste, Co2 emissions, chemical residues and run-off, drought, labor shortages, health and sugar consumption, opaque supply chains and distribution inefficiencies, food safety and traceability, farm efficiency and profitability, and unsustainable meat production.