The hope of a venture capital (VC) funding 2026 rebound in the broadly defined agtech sector grew unlikely as market research firm PitchBook released a report detailing VC trends in Q2, showing further investor pushback in the space and new lows in deal counts.
Venture capitalists penned 107 deals in agtech in Q2 2026, and 263 deals in the first half (H1) of the year for a total of $2.4 billion invested in the sector, PitchBook reported. In Q2 2026, “quarterly deal count has collapsed to the lowest level in the visible series,” PitchBook stated.
Venture capitalists penned 875 deals in all of 2025, and if the current trajectory for 2026 is extrapolated out it would equate to a 40% decline in deal activity in H1 2026.
Agtech venture capitalists prioritized later-stage companies and precision ag companies – a consistent trend in recent quarters. All the top 10 funding rounds were considered late-stage companies, including three in precision ag, three in animal and aquaculture, two in crop inputs and enhancements, and one each in vertical farming and farm automation and equipment.
Precision ag company Tomorrow.io raised the largest funding round in Q2 2026 with its $210 million series F round, followed by vertical farming company Oishii with $151.6 million series in Series C funding and Asto CT with $83.2 million. Rounding out the top five, insect protein start-up InnovaFeed and Laxey raised $59.5 million and $54.4 million in funding rounds, respectively.
“Precision ag was the standout this quarter, accounting for about a third of all agtech venture value and leading in deal count as well. It’s winning because it sits directly on the two costs farmers most want to cut right now — labor and inputs — and because the technology has matured from analytics into action,” Alex Frederick, lead analyst for agrifoodtech and consumer at PitchBook and author of the report told AgNavigator.
He added, “The interesting shift is toward what we’d call agentic ag, systems that sense, decide, and act in the field rather than just handing a farmer another recommendation to execute. Investors are underwriting that trajectory, even though most products today still automate one crop or one task rather than the whole farm. The capital is following measurable ROI, water saved, labor hours reduced, and inputs cut, instead of another dashboard.”
Is a VC rebound in agtech off the table for 2026?
After back-to-back years of decline in agtech investments, venture capitalists in the sector were hopeful that 2026 would be the start of a rebound and the bottom of the current down-market cycle. However, that rebound is now expected in 2027 when exits return, Frederick explained.
Venture capital exits were muted in H1 2026 with 30 deals for a value of $623.2 million, including indoor farming company Cannatrek, which was acquired by Little Green Pharma for $100 million.
“We think 2026 is the bottom of the cycle rather than the year of recovery. The back half should be where deal activity stabilizes, but we don’t expect a clear rebound until 2027, when the exit market reopens, and LP capital loosens up. If we do see a bump in the second half, it will most likely show up in total dollars rather than deal count, driven by a handful of larger, later-stage rounds. Deal volume is still grinding lower, and there is no reliable seasonal tailwind that lifts the sector in the back half of the year,” he elaborated.
