Taking agritech innovations global
At a glance
From precision agriculture to alternative proteins, technology is changing the face of agriculture faster than ever before.
Now booming interest in agritech is proving a golden opportunity for startup founders with ventures aimed at helping farmers and growers move up the agricultural product value chain, and operate more efficiently and sustainably.
The founders of Sprout, the Palmerston North-based incubator and accelerator, spotted that trend five years ago, when well-established startup hub, The Factory, spun out accelerator, Sprout, with a focus on supporting emerging agritech businesses.
“This was really before investors were throwing around the term agritech,” says Marketing and Communications Lead, Chelsea Millar, who’s been with Sprout since its inception.
“At the time, there was a real desire to commercialise the agritech research coming out of Crown Research Institutes and universities, but little support for startups in that space,” adds Millar.
Sprout has since tripled its staff to 11, supported dozens of businesses, and created an incubator to further support its accelerator participants.
From early on, Sprout had a partnership with US-based Finistere Ventures, an investment firm with an agritech focus and a New Zealand connection in the form of co-founder and partner Arama Kukutai.
With investments in agritech startups around the world, and a $40 million war chest to invest, Finistere’s involvement allows founders to develop their businesses with a view to attracting investment cash from the outset.
“There are great synergies between an accelerator and a seed-stage investment business,” says Gil Meron, Sprout’s CEO and formerly a Finistere venture partner based in Israel.
“You’re investing in a team, and seeing them in the accelerator is a great way to observe how people work: What are they like under pressure? How flexible are they? Are they willing to pivot if their business isn’t working out?”
Deep focus, national reach
Meron says Sprout mirrors Finistere’s focus on agritech, which allows it to bring deep knowledge and expertise to advise emerging businesses. While based in the heart of the science and R&D precinct on Massey University’s campus in Palmerston North, Sprout works with agritech businesses nationally.
“We’ve become the go-to place for new agritech businesses to learn and grow, and other incubators and accelerators often refer founders to us for our specialist knowledge,” he says.
Sprout runs its accelerator twice a year, with 10-12 teams spending three months working closely with Sprout mentors to develop their technology and business plans. With many agritech businesses based on hardware or biotechnology, it can take 5-7 years to take a product from concept to trial.
“We can help speed up that process,” says Meron. “We’re also seeing many more software and artificial intelligence agritech ideas coming through.”
Recently, Sprout has been supporting foodtech initiatives, and it’s keen to increase the number of businesses it works with in that space.
Around 200 businesses apply for the Sprout accelerator each year. With many businesses led by technical founders, Sprout has a unique ability to lend entrepreneurial support to get startup teams into the commercial mindset.
One such startup is Scentian Bio, who joined Sprout’s accelerator from Plant & Food Research. The team, led by Chief Technology Officer, Andrew Králíček, had through years of lab work, developed synthetic insect receptor sensors to create a device to smell and taste chemical compounds.
“They were serious technologists with an entrepreneurial spirit, but they didn’t have a clear CEO,” says Meron.
Investing $1 million in Scentian Bio alongside Fonterra, OurCrowd, and Callaghan Innovation, Sprout and Finistere also recruited one of their mentors in an executive chairman role to help establish the business. Now Scentian Bio has struck a deal with San Diego biotech business, Cardea Bio, to incorporate its technology into devices that will be used to instantly assess food flavour and fragrance quality control in supply chains.
We show them our scars
The depth of Sprout’s industry connections is another strength of the organisation.
“Many of our corporate partners see the value in getting assistance with that early-stage business-building capability,” says Meron.
“There’s a growing appetite on their part to trial, test and pay for the type of technology our businesses are developing.”
“Ultimately, what we do at Sprout is show these founders our scars, and share our experiences; we’ve been there and we know what it’s like.
“For some of them, we’ll write a cheque for $1 million or more as an investment in their business.”
Callaghan Innovation provides funding to a national network of founder incubators and accelerators that help early-stage, high-growth startups build sustainable businesses.
Updated: 28 January 2022