Agricultural innovation may be emerging from a difficult investment cycle stronger than before, according to Paimun Jared “PJ” Amini, VP of Venture Investments at Leaps by Bayer.
Speaking to AgNavigator at the World Agri-Tech Innovation Summit in London, Amini said he is seeing what he describes as a “second awakening” of science-led agtech start-ups, particularly in biological crop protection.
A second awakening for crop-protection start-ups?
While early biologicals companies helped establish the category, many struggled to combine strong field performance with economics that worked for farmers. Amini believes a new generation of start-ups has learned from those experiences and is now developing products capable of competing at commercial scale.
“We’re seeing a new wave of crop protection companies, specifically aimed at the biological sector, that are finally hitting this threshold of thinking about the right economics and the right efficacy levels to actually get into the market and stay in the market,” he said.
Among the technologies attracting his attention are RNA and RNA interference (RNAi)-based crop protection solutions. Bayer-backed start-up Robigo is one example of companies seeking to commercialise the technology.
According to Amini, the science behind RNAi has long been proven, but previous efforts struggled with application rates, delivery methods and commercial viability. New delivery mechanisms are now helping overcome those barriers and improving the technology’s economic potential.
Founders are becoming tougher and smarter
Despite the funding challenges across the sector, Amini says start-up founders are showing remarkable resilience.
Rather than being discouraged by tighter capital markets, many entrepreneurs are drawing lessons from previous agtech cycles and surrounding themselves with experienced advisers who have already navigated industry downturns.
One founder recently told him: “We have to believe in our mission more than anyone else because if we’re not driving it forward, nobody else will.”
Amini believes that mindset, combined with a growing pool of experienced operators and investors, is helping start-ups avoid some of the mistakes that characterised earlier generations of agtech ventures.
He also sees signs that investor interest is gradually returning, with generalist investors beginning to re-enter the sector after a period of caution.
Improving economics could unlock the next growth cycle
Looking ahead, Amini sees several factors that could strengthen both investment activity and exit opportunities across agtech.
Commodity prices are one. With corn prices moving back above $5 per bushel and soybeans above $13 per bushel, market conditions are becoming more supportive for agricultural innovation and adoption.
He also pointed to a growing pipeline of strategic transactions, new corporate partnerships and IPO activity from the likes of Syngenta and BASF that could create additional routes to market and liquidity for investors.
“When we speak next year, I hope we’ll be discussing an ecosystem where more of those opportunities have become reality,” he said.
World Agri-Tech London Webinar: Event Intel Unwrapped
This interview was conducted at the recent World Agri-Tech Innovation Summit in London. The full on-camera interview with PJ Amini, alongside discussions with other industry experts, will be featured in AgNavigator’s World Agri-Tech Unwrapped webinar on 4 November. The webinar will also be available on demand. Register for free here
