Value of Agtech startup funding falls 30%, deal volume remains stable

09 February 2017

Investment value in the Agtech startup scene fell 30% to $3.2 billion, on the back of increased investor scrutiny, dropping venture sentiment and general uncertainty. Investors remain keen on funding SEED stage companies, with particular appetite for the food marketplace/e-commerce sector. In total, investment volumes saw a 10% uptick. 

Investment in the agriculture startup market increased from $400 million in 2010 to nearly $4.6 billion in 2015. The growth in investment followed wider market trends within the startup space, which, according to KPMG’s Venture Pulse, hit $141 billion in 2015. While interest in startups remains hot, concerns about valuations began to surface over 2016, as the investors began to take a closer look at the realistic revenue/profit potential of their investment stock. Total venturing investment in the startup market dropped noticeably on the back of concerns, falling to $127 billion.

In a new report from Agfunder (‘Agtech Investing Report’), a similar trend is noted in the Agtech startup market, with total investments between 2015 and 2016 falling around 30% to just over $3.2 billion. Food e-commerce and delivery and biotechnology startups were the biggest drawcards for startup funding in 2016.

Deal volume and activity by quarter

This follow years of explosive growth, as investment in the segment increased from $900 million in 2013 to $2.4 billion in 2014. 

The drop was, however, only noted in terms of value. Volume in startup investments was higher in the first three quarters with respect to the same quarter the year previous. In Q1 2016, value stood at $716 million compared to $1,255 million the year previous, while volume increased from 155 to 168. Only the last quarter of 2016 saw a drop in volume like for like, from 116 investments to 107, while value fell from $1,262 million to $695 million.

Aside from a change in investor sentiment, the firm’s analysis notes that a decrease in funding to bioenergy, drone technology and food delivery drove the downward investment trend. The final quarter of 2016 was further impacted by political uncertainty as Trump, unexpectedly, took power in Washington – driving investors into, among others, a ‘wait-and-see’ mode.

Deal volume and activity by category

The sector breakdown of deal activity shows that the food marketplace/e-commerce sector continues to draw the lion’s share of interest from the investment community, counting 158 deals and almost $1.3 billion in inward investment. Agricultural biotechnology companies come in second, at 85 investments totalling $718 million. The robotics, mechanisation and other farm equipment segment saw a decrease of 39%, largely on the back of lower investments in drone technology.

Investment by category 2014 until 2016

The research notes some changes in investors’ appetite over the past three years. Aside from the decrease in investment in robotics, mechanisation and other farming equipment, bioenergy and biomaterials too saw a significant drop in funding. Food marketplace/e-commerce, which exploded onto the scene in 2015 in terms of funding, continues to attract funding – in part due to the potential $60 billion market from which successful startups may derive revenues. Agricultural biotechnology companies have seen funding increase again, following a dip in 2015, while most other categories report relative steady results on the years previous.

Deal volume and activity by stage

In terms of funding round volume and value, SEED funding is out ahead in terms of volume, at 337 investments for a total value of $217 million – with average investments at $0.9 million and median deal values at $0.5 million. Stage A investments saw 86 startups unevenly split $459 million, averaging $6 million each with median pay-outs of $4.5 million. Stage B and C saw increasingly smaller numbers of startups (55 and 22 respectively) split, again unevenly, around $800 in each category.

Agtech deal activity 2014-2016

The researchers note that it are particularly late stage startups whose funding levels saw decreases in the face of investor caution. Deal activity, the firm’s analysis notes, is skewing towards SEED investment, up from around 45% in 2014 to almost 60% in 2016. Stage A funding was particularly hard hit in the latest funding round, while C and D too saw contractions. Late funding was, however, up slightly as a % of total deals compared to the previous two years.

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Red Consultancy drives interest in Schubert's formerly Unfinished Symphony

08 March 2019

Strategic communications firm Red Consultancy collaborated with Huawei to demonstrate the potential of artificial intelligence. Huawei engaged an AI programme on one of its smartphones to help complete Schubert’s famous Unfinished Symphony, almost 200 years after the maestro commenced its composition.

Franz Schubert's Symphony No. 8 in B minor, D 759, commonly known as the Unfinished Symphony, is a musical composition that Schubert started in 1822. While the Austrian composer lived another six years, he left the piece with only two movements. The reason he left it unfinished – despite having made sketches some way into a third movement – continues to be discussed and written about, and has two centuries of classical music enthusiasts wondering what might have been.

Despite numerous attempts, it remains one of the most intriguing pieces of unfinished symphonic music of all time. Now, the world may finally have an answer to the conundrum of just how it might have ended, however, thanks to work from technology firm Huawei. The Chinese multinational ‘completed’ the piece, some 197 years after Schubert last set it aside, with the assistance of artificial intelligence (AI) running on one of the company’s smartphones.

By running an AI model from the Huawei Mate 20 Pro smartphone – which was designed specifically with AI-based tasks in mind – Huawei was able to analyse the timbre, pitch and meter of the existing first and second movements of the symphony, before generating the melody for the final, missing third and fourth movements. At this point, Emmy award-winning composer Lucas Cantor was enlisted to arrange an orchestral score from the melody that stayed true to the style of Schubert’s original structure. 

Walter Ji, President CBG, Huawei Western Europe, explained, “At Huawei, we are always searching for ways in which technology can make the world a better place. So, we taught our Mate 20 Pro smartphone to analyse an unfinished, nearly 200 year old piece of music and to finish it in the style of the original composer. We used the power of AI, to extend the boundaries of what is humanly possible and see the positive role technology might have on modern culture. If our smartphone is intelligent enough to do this, what else could be possible?”

The final, Huawei-completed piece was brought to life with a live performance at the iconic Cadogan Hall in London on the 4th February. The 67-piece English Session Orchestra performed to an audience of over 500 guests, showcasing for the first time this unique ending to Schubert’s Symphony No. 8, illustrating the potential of human talent augmented with AI in the process. On the back of this, Red Consultancy worked with Huawei on a viral marketing campaign to deliver the final product to millions of listeners across the globe.

Red Consultancy is a professional services firm which offers advisory services to clients looking for PR, digital and content expertise via its 140 staff in its Soho offices. The firm develops and manages campaigns, runs major press offices, and steers brands and businesses through engagement with media, consumers, customers, stakeholders and internal audiences both domestically and internationally. According to Red Consulting, its Huawei campaign has already resulted in over 11 million views of the Unfinished Symphony video content, from more than 1,500 pieces of international media coverage, and an estimated reach of nearly 900 million.

Commenting on the story, Maureen Conlon, Huawei Lead Director at Red Consultancy said, “Working with an ambitious brand like Huawei challenges us to consistently think outside the box and come up with truly unique and creative campaigns. For Unfinished Symphony, we worked with the client from initial ideation all the way through to activation and the Huawei team at Red Consultancy could not be more thrilled with the result.”

Related: Red Consultancy handed new role with Munchkin.