Agriculture is finally ready for robots
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As an investor in agricultural technology over the past decade, I would say 2020 has been a turning point. The pandemic has accelerated a shift that was already underway to deploy automation in the agricultural industry. Other venture capitalists seem to agree. In 2020, they invested $ 6.1 billion in agro-tech startups in the United States, a 60% increase from 2019, according to a study by PitchBook. The number is all the more staggering when you consider that in 2010, venture capital investments in American agro-tech startups totaled just $ 322 million. Why has 2020 turned the tide of investment in agricultural technologies and what does this mean for the future of agriculture? Which agro-tech startups are poised to become leaders in the global multi-billion dollar agriculture industry? I will explore these questions further below.
The pandemic has forever changed many sectors and agriculture is no exception. With inactive processing plants, supply chain disruptions and COVID outbreaks among workers reducing an already resource-strapped workforce, farmers faced unprecedented challenges and quickly realized that some of these problems could be solved by automation. Entrepreneurs already active in the agri-tech space, and those who may be considering starting an agri-tech business, saw an opportunity to apply innovation to the long-standing challenges of agriculture – and now all the more urgent. .
Boom in investment in agricultural technologies
Firms applying robotics, computer vision and automation solutions to agriculture have been the biggest beneficiaries of record levels of venture capital funding over the past year, particularly vertical agriculture companies that grow crops indoors on scaffolding. Bowery recently raised $ 300 million in additional venture capital funding and is now valued at $ 2.3 billion, while AeroFarming recently announced its intention to go public in a PSPC deal valuing the company at $ 1.2 billion. Vertical farmer with herbs Plenty raised over $ 500 million in venture capital financing, while the vertical tomato producer AppHarvest went public via a SPAC in February and is now valued at over $ 1.7 billion, despite recent stock price swings.
But while vertical farm businesses have received a large chunk of venture capital funding, there are plenty of other agro-tech startups emerging in the race to automate agriculture. Some of the agricultural technology sub-sectors where we see the greatest potential for growth over the next five years include robot tillers, weeding and planting; drones equipped with sensors used to assess crops and plan fertilizer programs; greenhouse and nursery automation technology; computer vision systems to identify crop health, weeds, nitrogen and water levels in plants and soil; robots for transporting, sorting and packaging crops; and AI software for predictive performance planning.
Some of the slightly more remote sub-sectors include picking and planting robots, as well as fertilizer and watering drones. A few startups are building tactile robotic hands that could be used to pick delicate fruits such as strawberries or tomatoes. Still, the picked fruit must be placed on autonomous vehicles capable of navigating rough terrain and paired with packing robots that place the fruit carefully to avoid bruising, so challenges remain. Meanwhile, today there are drones that can drop fertilizer or water on fields, but their use is strictly regulated and their range and battery capacity are limited by payload capabilities. . In about 10 years, we might start to see drones that use cameras, computer vision, and AI to assess plant health, and then automatically apply the right amount and type of fertilizer based on size. and the chemical composition of plants.
Solve the right problems
In order for an agro-tech company to win over farmers, it has to solve a big problem and do it in a way that saves them a lot of time and / or money. While a manufacturer may be happy to deploy a robot for incremental improvement, farmers operate on extremely tight margins and want to see exponential improvement. Weeds, for example, are a huge problem for farmers, and the preferred method of killing them in the past, pesticides, are dangerous and unpopular. A number of companies have emerged to solve this problem with a combination of AI, computer vision, and robotics to identify and pull weeds in the fields. Naio Technologies and FarmWise are examples (disclosure: my company is an investor in FarmWise). Meanwhile Bear Flag Robotic made great strides in the automated agricultural vehicle space, building robotic tractors that intelligently monitor and plow large fields. And Burro is a leader in crop transport robots, with its autonomous vehicles used to move picked fruits and vegetables from the field to processing centers.
While fully autonomous harvesting is still a long way off, robot apple pickers are starting to gain traction, including those from Tevel Aerobotics Technologies. Tevel’s futuristic drones can recognize ripe apples and fly autonomously around trees by picking them and carefully placing them in a large transport box. Abundant robotics takes a different approach to harvesting apples, using an earth robot with a smart suction arm to harvest and pack the ripe fruit.
Several greenhouse and nursery robots aim to improve handling, climate control and other tasks in plant growing operations. Harvest automationSmall autonomous robots can recognize, pick up and move plants in a nursery. Other greenhouse automation companies to watch out for include iUNU, which offers a computer vision system for greenhouses, and Iron buffalo, who built large robotic greenhouses to grow vegetables.
And, finally, satellite imagery companies such as PlanetLabs and Descartes Laboratories will also play an important role in agricultural technology, as they provide geospatial images of cropland that can help farmers understand global climate trends.
In the face of climate change, a growing population, labor shortages and other challenges that will only intensify, the agricultural sector is ripe for disruption. Agricultural giants such as Monsanto and John Deere, as well as small and medium-sized farms, are embracing automation to improve crop yields and production. But the large-scale adoption of farm automation will not happen overnight. For an agro-tech innovation to take hold, it must solve a huge problem and do so in a repeatable way that does not interfere with a farm’s current workflow. There is no point in deploying robotic gatherers if they cannot fit into the current systems of packaging and transporting a farm’s crops, for example.
We could well see small and medium farms leading the way in the adoption of automation. Although factory farms have large reserves of capital, they also have systems in place that are more difficult to replace. Small farms have fewer systems to replace and are ready to try out robot-as-a-service (RaaS) solutions from lesser-known startups. For millennia, farmers have thought outside the box to find solutions to everyday problems, so it stands to reason that they want to work with startups that think the same way they do. Farmers wake up everyday and think, here is a big problem, what innovative trick can I use to solve it? Maybe the farmers steeped in self-sufficiency and the agricultural tech entrepreneurs steeped in engineering and IT aren’t that different after all.
Kevin Dunlap is co-founder and managing partner of Calibrate companies. He was previously Managing Director of Shea Ventures, where he supported companies such as Ring, Solar City and Chegg. Kevin currently sits on the boards of Broadly, Soft Robotics and Realized.
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