Photo credit: Yabiladi.com

The funding will be allocated across several Africa-owned venture capital funds investing in sectors including fintech, healthtech, logistics, climate technologies, and agritech. While the announcement is not agriculture-specific, it represents an important signal for agritech startups in the region, where fundraising conditions remain challenging. Among the selected funds is Future Africa Fund III. Future Africa’s broader investment track record includes agriculture-related ventures such as ThriveAgric and Farmcrowdy.

For agritech, the announcement is less about immediate funding and more about who controls the flow of capital. As African institutions take a larger role in financing local innovation, they may also play a greater role in shaping which technologies, business models, and startups receive support. More broadly, AFC’s initiative reflects an effort to deepen local ownership within Africa’s innovation ecosystem and reduce dependence on external sources of venture capital.

While agritech adoption could generate more than USD 90 billion in additional annual GDP by 2033, investment across the region fell by nearly 70% between 2022 and 2025, reflecting investor uncertainty about which business models can scale sustainably despite continued demand for digital agriculture solutions.

The report finds that many early agritech ventures continue to face logistics complexity, thin margins and limited expansion opportunities across fragmented smallholder systems. It also identifies the main constraint at the Seed-to-Series A transition, where fewer companies progress to later funding rounds. Development finance institutions are therefore expected to remain central to early-stage market formation, with blended finance combining equity, credit and concessional capital continuing to underpin agritech investment.

The innovation gradient across regional ecosystems

Source: Beanstalk AgTech, Briter

Another key finding concerns the difficulty of regional scale-up. While in Africa commonalities in language, donor ecosystems and agricultural market structures are enabling a growing number of agritechs to expand across borders, South and Southeast Asia remain highly fragmented. Differences in policy regimes, value-chain structures and farm organisation mean that approaches successful in markets such as Vietnam or Indonesia often require substantial redesign before entering neighbouring countries. Scaling depends primarily on a high degree of country-specific adaptation rather than regional rollout strategies.

In terms of emerging opportunity areas, the report finds that investment is increasingly concentrating on traceability-driven digital value chains, embedded agricultural finance linked to procurement systems, and aquaculture.

The study, which draws on data from the AgBase platform, shows that total investment fell to just under USD 170 million, down around 20% from USD 200 million in 2024, while the number of deals declined by about 10%.

The sharpest drop was in on-farm solutions targeting smallholder farmers. In contrast, pre-farm (e.g. inputs, biotech), post-farm (processing, storage, logistics) and retail segments (distribution and delivery) all saw increased funding.

Source: AgBase 2026

What this shows is that while most deals are still in on-farm solutions (around 50%), often backed by grants, most of the money is going elsewhere. Larger funding is flowing into logistics, aggregation, marketplaces and infrastructure models that can absorb bigger tickets. Much of this is driven by debt financing in production and transport, pointing to a shift toward more asset-heavy businesses with clearer, more predictable revenues.

The importance of embedding financial services

Around a quarter of agritech companies now embed financial services, including payments, credit, insurance and equipment leasing, into their core offering. While they represent roughly 25% of companies, they account for over 60% of total funding.

This reflects a broader shift: the main constraint to scaling agriculture in Africa is often not technology, but access to working capital and financial services. As a result, capital is moving toward models that integrate financing with operations, particularly in downstream segments such as marketplaces, aggregation and logistics.

Concentration remains, but geography is widening

Funding remains highly concentrated. Since 2016, just 12 companies (fewer than 2% of the total) have raised over USD 50 million each and captured more than half of all agritech funding. These are primarily based in Kenya, Egypt and Nigeria, with companies such as Apollo Agriculture and Pula among the most prominent.

At the same time, the geographic spread is evolving. Kenya’s share of funding fell from over 50% in 2023–24 to around 25% in 2025, with capital spreading to markets such as Ghana, Nigeria, South Africa and Tunisia.

Source: AgBase 2026

The winner does all dynamic

A small group of scale-ups continues to capture a disproportionate share of funding. Between 2016 and 2025, just 12 companies raising over USD 50 million accounted for more than half of total agritech investment, including players such as Pula, SunCulture, Twiga Foods and Apollo Agriculture.

These companies typically follow integrated models, combining inputs, logistics, marketplaces and fintech, and are increasingly positioned as finance- and infrastructure-led platforms rather than pure technology plays.

Outcomes, however, have been mixed. Capital alone has not guaranteed resilience: those that have endured built sustainable margins, controlled costs and aligned their capital structure with asset-heavy operations, while others expanded faster than their economics allowed.

AgBase is an initiative of Briter backed by the Bill and Melinda Gates Foundation and The Foreign, Commonwealth & Development Office (FCDO), and implemented in partnership with Mercy Corps AgriFin.

At stake is not only the future of digital agriculture, but control over what I call the “intelligence layer” of agriculture: the data systems, AI models and algorithms that increasingly guide farming decisions.

As agriculture becomes more data-driven, the actors who control this intelligence layer will shape what crops are grown, how inputs are used and how farming risks are managed.

A structural shift is underway in agriculture. Historically, power in agricultural value chains was concentrated in three places: input suppliers, traders and food processors. Today, a new layer is emerging above them: digital systems that analyse agricultural data and generate recommendations for farmers. This intelligence layer is becoming a critical point of influence in farming systems.

The article references the recent report “Head in the Cloud” by the International Panel of Experts on Sustainable Food Systems (IPES-Food). The report warns of a “top-down” approach to farming systems in which Big Tech and Big Ag companies increasingly provide farmers with AI-driven decision tools. Supported by both public and private investment, these systems risk effectively outsourcing farmers’ decisions to distant algorithms, with limited accountability.

Examples include digital farm-management platforms that combine satellite and field data to generate recommendations on planting or input use, as well as cloud-based AI systems that guide decisions on crops and farm management.

Image credit: IPES-Food

The risks of farming by algorithm

Consider a farmer in Ethiopia. A digital agriculture tool trained on global datasets may have little or no knowledge of teff, Ethiopia’s most widely consumed grain. Instead, it might recommend crops such as corn, for which extensive global data and agronomic models already exist, often linked to fertilisers and pesticides. In practice, such tools are likely to guide farmers toward crops and practices that reflect global datasets and supply chains rather than local agricultural realities.

This emerging model of “farming by algorithm” risks overlooking local knowledge, crops, and community-based innovation systems. There is a long-standing lesson in digital agriculture: good solutions must build on local knowledge and farming practices, not replace them.

As AI-driven agriculture expands globally through private-sector platforms and Big Tech–Big Ag alliances, questions arise about how these models will shape farming systems, particularly in low-resource LMIC contexts.

Models trained on global datasets can easily embed bias, and the risk of failing to support locally appropriate farming decisions is significant. At the same time, innovations rooted in local knowledge systems often remain undervalued and underfunded compared with large-scale, globally designed technology solutions.

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Building the local data railways for grounded digital agriculture

In this context, the public sector is stepping in to lay the railways of localised and shareable data. The idea is to create national layers of publicly available agricultural data (covering soils, crops, weather and farming systems) that can serve as a shared foundation for AI models powering digital agriculture tools, from startups to research institutions.

Digital public infrastructure (DPI) for agriculture has emerged with the promise of building tools grounded in local realities. Agricultural DPI initiatives are now appearing across multiple countries, with very advanced examples in India, but also in places like Ethiopia, and more emerging initiatives elsewhere such as Côte d’Ivoire.

DPI is not just a technical architecture, it is also a governance tool intended to ensure that the intelligence layer of digital agriculture remains grounded in local ecosystems rather than dictated by global platforms, an approach that increasingly mirrors wider efforts by governments to build sovereign data infrastructures for AI.

The question is how these two major trends, global Big Tech–Big Ag coalitions and locally led agricultural DPIs designed to support innovation grounded in local data, will coexist.

Who controls the intelligence layer?

Global AI models, often trained on a relatively narrow set of crops and production systems, could increasingly shape farming decisions across very different contexts. Whether these systems will meaningfully engage with emerging public agricultural data infrastructures, and under what incentives, remains uncertain.

The IPES-Food report takes a strong stance on the role of Big Tech and large agribusiness firms. Ultimately, however, the debate it raises is less about technology than about power: who controls the intelligence layer of digital agriculture.

Agricultural DPIs may offer countries a pathway to anchor agricultural intelligence in more open and locally grounded data ecosystems. But the existence of a DPI alone does not guarantee that global technology or agribusiness firms will align with these frameworks. Even when they do engage, their scale and resources may give them disproportionate influence over how these systems evolve.

At the same time, most countries are still at a very early stage in building agricultural DPIs. Progress is emerging, but this knowledge infrastructure will take time to reach meaningful scale.

The key question for the coming decade is therefore not simply who builds the most advanced digital tools for farmers. Innovation will come from many directions: Big Techs, agribusinesses and local agritech startups alike.

The deeper question is who governs the intelligence layer on which these tools depend. In other words, who sets the rules, standards and data infrastructures that shape how agricultural knowledge is generated and applied.

In the end, the future of digital agriculture may depend less on who builds the algorithms, and more on who governs the systems that feed them.

Under its agreement with Starlink, Globe plans to integrate direct-to-cell satellite services into its mobile network to extend coverage to remote islands and underserved rural areas across the Philippines. As an archipelago of more than 7,600 islands, the country faces structural challenges in achieving nationwide mobile coverage using terrestrial infrastructure alone, positioning satellite-enabled connectivity as a strategic complement rather than a replacement for existing networks.

Photo credit: Developing Telecoms

In parallel, Lynk Global has carried out direct-to-device testing with Smart Communications, including trials in Catanduanes, demonstrating basic messaging and limited data capabilities in areas without cellular coverage. The tests form part of broader preparations for potential commercial satellite-to-mobile services in the country.

Why it matters

Agriculture is among the sectors expected to benefit most from improved connectivity, particularly in rural regions where farmers and agribusinesses face persistent coverage gaps. Many digital agriculture applications are designed to operate with limited bandwidth, but more reliable satellite-enabled connectivity would support wider adoption across remote farming communities.

The Philippine initiatives reflect a broader global trend, as mobile operators increasingly partner with satellite providers to extend coverage, improve network resilience, and advance digital inclusion beyond traditional terrestrial footprints. In Africa, as reported by ArisTechia, mobile operator Airtel recently announced a partership with Starlink to rollout direct-to-cell satellite connectivity across 14 countries, beginning in 2026.

In this special Friday edition, I leverage ArisTechia’s reporting on digital agriculture news across low- and middle-income countries (LMICs) to analyse agritech funding trends in our key focus regions – Africa, South Asia, and Southeast Asia.

The headline finding? Agritech startups in these three regions raised a total of $303 million in 2025 across 65 reported deals. This represents a steep 46% decline from the $564 million recorded in 2023. While the number of deals held steady compared to 2023 (62 deals), the funding totals fell far short of the previous year.

Disclaimer: ArisTechia focuses on upstream agritech innovations, including "on-farm" and post-farm digital solutions that directly impact farms or farmers. Our reporting does not cover consumer-end innovations in agricultural value chains (e.g. foodtech).

The big picture: 2024 VS 2023

Here’s how agritech funding in LMICs compares quarter by quarter (figure 1). In 2023, after a slow start, funding surged in the third and fourth quarters, delivering a strong finish. In contrast, 2024 started off promisingly but quickly lost momentum, resulting in a relatively sluggish year overall.

Fig. 1: Agritech funding quarter by quarter, 2023 VS 2024

Source: ArisTechia

If we look at regional trends (figure 2), there’s some good news: Africa performed better in 2024 than in 2023, with a 6% increase in funding. This is great to see. The biggest decline was in Emerging APAC. South Asia experienced a 31% drop in funding, while Southeast Asia saw a dramatic 80% decline.

There is a significant “but.” Last year’s strong performance in APAC, particularly Southeast Asia, was largely driven by the massive $200M Series D raise of Indonesian aquatech eFishery. We didn’t see a comparable deal in 2024. Even setting that aside, the overall trend in 2024 remained less favourable compared to the previous year, with both the second and third quarters underperforming relative to the same periods in 2023.

Fig. 2: Agritech funding by region in 2024 ($M)

Source: ArisTechia

In 2024, ArisTechia reported a total of 65 deals across three regions, a slight increase from 62 in 2023. However, as shown in Figure 3 below, more than half of the deals occurred in the first quarter (33 deals). While the year was off to a very good start, eventually 2024 didn’t deliver to its initial promise. In 2024, activity declined as the months went by, and it was quite weak when compared to the previous year, especially in the second half.

Fig. 3: Number of agritech deals by region in 2024 VS 2023

Source: AristTechia

So what happened in 2024? Similar to 2023, investor confidence in digital solutions that enable market linkages for farmers remained strong. We tracked $127M in investment across 15 deals for startups focused on market linkage platforms for agri-inputs and outputs—representing approximately 42% of the total agritech funding for the year. This is comparable to 2023, when startups centered around market-linkage innovations secured $148M over 20 reported deals.

Other than market linkages, investors in 2024 increasingly turned their attention to startups offering innovative solutions to climate challenges. We tracked $53M across seven deals in climate-smart, nature-based solutions, and weather-related innovations. Additionally, agri digital financial services (DFS) providers attracted $26M, including a notable $20M Series B round for Insurtech Pula in Kenya in April.

In 2024, providers of market linkages, climate-driven solutions, and Agri DFS (Digital Financial Services) accounted for 68% of the total investment in digital agriculture startups addressing the needs of smallholder farmers. The majority of the remaining funds were directed toward established companies offering holistic solutions that address multiple use cases, including advisory services. What became clear – if further confirmation was needed – is that standalone digital advisory services, no matter how good they are, are less relevant and therefore less attractive for investment.

Fig. 4. Top deals (+$20M) reported by ArisTechia, 2024

A closer look at agritech markets

Africa

In Africa, Kenya had a strong year, consolidating its role as a regional hub and an agritech leader globally. We tracked more deals in 2024 (11) in the country than in 2023 (7), as funding grew 62% year-on-year to $63M. In 2023, Kenyan agritechs raised 51% of the funding in Africa (7% globally), and in 2024, this figure rose to 63% of regional funding—representing $2 for every $3 raised on the continent. That was a remarkable 21% of global agritech funding. The $27.5M Series B raise in April by Kenya-based SunCulture was not only the largest deal in Africa but also the second largest globally, after India’s Arya.ag $29.2M July raise.

The rest of Africa saw some good activity and increased diversification in 2024. Agritechs raised funds in seven countries, including Nigeria and Ghana, but also in Morocco, Senegal, Tanzania, Uganda, and Zambia. An interesting trend this year was the growing number of raises by agritechs operating across multiple regional markets, signaling a shift toward scalable, regional approaches. Notable examples include SunCulture, Pula, as well as players like Hatch Africa, eAgronom, and Insurtech IBISA. Estonia-based eAgronom, for example, secured in July $10.8M Series A to expand its regenerative agriculture solutions. Since 2022, it has been active in Rwanda, Kenya, South Africa, and Tanzania, with plans for further expansion in Uganda and Zambia.

India

India's agritech sector saw a significant decline in 2024 compared to 2023. As the largest agritech market in the LMICs, India tracked fewer deals (16, down from 22 in 2023) and less funding. Indian agritechs raised $150M, marking a 50% year-on-year decrease. Despite this, India still represented about 50% of the total agritech funding across LMICs (Africa and Emerging APAC).

The slowdown in venture capital, driven by inflation, market uncertainties, and inflated valuations from previous years, continued to impact early-stage ventures in 2024. Additionally, we did not witness the same high-value deals of 2023, such as the $62.5M raised by Leads Connect or the $46M raised by Vegrow. Arya.ag’s $29.2M raise in 2024 was the largest deal of the year across all regions covered by ArisTechia, bringing the agritech to an impressive market evaluation of $325M.

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Southeast Asia

Southeast Asia's agritech landscape showed mixed results in 2024. Indonesia, which had a standout year in 2023 due to eFishery's $200M deal, faced a slowdown. Even excluding the eFishery deal, the country showed weaker performance compared to the previous year. Indonesia still accounted for 58% of the total funding in Southeast Asia, with raises like the $20M by Chickin to grow its digital solution for poultry farmers, and it was the third-highest funded country across all African and Emerging APAC countries.

But several key players in the country went through multiple rounds of layoffs or even ceased operations reflecting challenging market conditions. eFishery itself, Indonesia's first agritech unicorn and the only aquatech unicorn globally, suspended its co-founders amid amidst an ongoing investigation into alleged financial irregularities.

On a positive note, the rest of Southeast Asia did well, registering a 58% y-o- increase in 2024, with markets like Vietnam and Thailand seeing more activity, while players based out of the regional tech hub of Singapore, like Rize and AgriG8, secured funding for their multi-country play.

Terminations and DPIs in the horizon

It is undeniable that 2024 also brought to digital agriculture practitioners a sense of realism when it comes to the commercial viability and scalability of private-sector lead agritech initiatives. In the year we saw several startups “going down” and some notable organisations ceasing operations. This was the case of Kenya’s iProcure, which in May entered administration as it faced bankruptcy, of India’s Greenikk, a digital platform for banana farmers, and of US-based Gro Intelligence, a well-established player working across LMICs. Founded in 2012, the company had raised USD 85 million in a Series B round in 2021.

Building on recent developments, 2024 marked a turning point for the growing prominence of sector-specific Digital Public Infrastructure (DPI). Amid the challenges faced by many private-sector providers of agritech solutions and declining funding in the sector, there is a rising call for greater public sector leadership and involvement in digital agriculture. DPIs are digital platforms and systems designed to enable equitable access to public and private services, data, and technologies.

The promise of DPIs lies in their potential to address the persistent issues of fragmented and unverified datasets, creating a standardised and accessible repository of data for anyone looking to innovate. By democratising access to critical information, DPIs have the capacity to stimulate innovation across all levels of the agriculture ecosystem.

It is important to recognise that DPIs and private-sector innovation are not mutually exclusive. In fact, as DPIs gain traction, they have the potential to become a transformative force for all actors involved in digital agriculture. A notable example is India, where the government invested $336 million in its 'Digital Agriculture Mission' in 2024. This initiative positions India as a key player to watch in 2025.

Looking ahead, I anticipate a strong recovery in agritech funding this year, particularly in India, where startups are expected to benefit from an increasingly supportive and enabling environment.

The headline is that it has been a stronger first quarter than it was a year ago, with a greater number of deals and greater overall funding going toward agritechs. At a first glance, it looks like 2024 could be a better year than 2023. Below, I unpack the data and highlight the main trends that I am seeing.

A look at the numbers: How does 1Q24 compare VS 1Q23?

In 1Q24, we tracked 34 deals by agritech startups working on smallholder agriculture across the three regions. This compares to 24 reported deals for the same period a year ago, representing 42% growth in overall activity year-on-year. 

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The larger number of deals resulted in a larger amount of funding going to agritechs in 1Q24 in the three regions, when compared to 1Q23. The total amount of reported raises for the quarter just ended is ∼$102 million. This compares to ∼$92 million for the same period a year ago. Funding going to the sector therefore expanded by 12% year-on-year.

Fig. 1: Agritech funding in LMICs, 1Q23 VS 1Q24

Source: ArisTechia

While we saw greater activity in 1Q24 VS 1Q23, the average deal size was lower this last quarter. We are looking at ∼$3.0 million in the first quarter of 2024 as opposed to ∼$3.8 million in the same period last year.

This is explained by the relative impact of the largest raises within the quarters. In 1Q23, the four largest raises of +$10 million amounted to 70.2 million and represented 77% of the total amount of funding in the quarter. Three out of these four were from India, with the exception (fourth place) of the $13.5 million Pre-Series B of EdenFarm in Indonesia. These were important deals, such as the $13.7 million Series D by CropIn. Together with eFishery’s $108 million mega Series D in Indonesia in May 2023, CropIn’s raise was the only Series D round in the agritech sector tracked ArisTechia since it started publishing in February 2022. 

In contrast, there were only two +$10 million raises in 1Q24, amounting to $32.5 million and making for just 36 percent of the amount of funding in the quarter (see fig. 2). But 1Q24 witnessed a more solid performance across the board. If we look at the list of top reported deals over $500,000, in 1Q24 we have to get to the 14^th place in that list to go below the threshold of $2 million. In 1Q23, there were only five deals above this threshold. 

Fig. 2: Top reported agritech deals over $500K, 1Q23 VS 1Q24

Source: ArisTechia

The table above shows quite clearly the dynamism in 1Q24, especially at Seed to Series A stages (Seed/Pre-Series A/Series A). The quarter saw a total of $61.9 million funding across these three stages, while the same figure for 1Q23 was $23.7 million.

How did the regions do?

Most of the activity was in South Asia (India), and that of course applies this year as much as last year. If we just look at the largest deals by Indian agritechs in the table above, we will see that they made for ∼59%  of the total amount of funding going to the sector, globally, in 1Q24. The same figure in 1Q23 was ∼65%. This trend can be explained by the growing importance of other markets and regions within the agritech landscape in LMICs. This is happening in a global context where the overall trajectory is that of a (moderate) growth. 

We can look at Africa, for example. In this last quarter two Africa-focused agritechs, Hatch Africa and Apollo, took the second and the third spots in the table of the largest agritech deals. This is quite significant. Hatch, which operates in the poultry sector, raised $9.5 million to scale up in Kenya, Ghana, and Cote d’Ivoire. Apollo received a $10 million investment to grow its product and financing platform for smallholders. With this raise, Apollo reached $67.8 million cumulative funding since it started operations in 2016.

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Africa takes a larger share of global agritech funding than it did a year ago. It has grown  from 15% in 1Q23 to 25% in 1Q24, reaching $25.3 million. But one must not forget that 95% of the total funding for the region for the last quarter comes from just three deals. We get to this percentage by adding to the above mentioned deals by Hatch and Apollo the $3.7 million Pre-Series A by Shamba Pride in Kenya, which occupies position 12^th in our table above. While there is some good traction, a lot of the activity is around grants, smaller tickets and at Pre-Seed and Seed stage.

Fig. 3: Agritech funding by region, 1Q23 VS 1Q24

Source: ArisTechia

Southeast Asia’s contribution, on the other hand, has declined from 20% in 1Q23 to 12% in 1Q24, with South Asia taking the lion’s share at 63%. Southeast Asia witnessed the same level of activity in 1Q24 as in 1Q23, but the main difference was the absence of a large +$10 million deals in the leading market of Indonesia, such as the Pre-Series-B raise by EdenFarm in February 2023. Still, during the last quarter, Indonesian startup Semaai secured $4.7 million Pre-Series A to scale up its digital solution centered around a marketplace app for inputs. This followed the $1.65 million that Semaai had raised just in February 2023.  

A positive trajectory for Africa

In my view, a key takeaway from these numbers is the relative growing importance of Africa within the global landscape. I think this argument is supported by two other developments in recent months.

First, as we have just entered the second quarter of 2024, long-established African agritechs like SunCulture and Pula have announced substantial raises. It was just at the beginning of this month that SunCulture completed an oversubscribed $27.5 million Series B fundraise to scale its solar IoT-enabled irrigation systems across sub-Saharan Africa. Less than two weeks later, Kenya-based agri insurtech Pula announced its $20 million Series B. This is a promising start of the year. We shall see more of these larger raises in the coming months. I suspect Nigeria, which is has been remarkably quiet in recent months, might be a likely candidate to attract new funding.

Another promising development for the region is the growing interest of well-established Indian agritechs in venturing into Africa. I take this as a sign of growing maturity in a few key markets.

In January, Ninjacart, one of the country’s main B2B agri e-commerce platforms, was the latest Indian agritech to announce plans to venture into Africa. It formed partnership a with a local organisation to start working in Egypt. The same month, another major Indian player like Arya.ag partnered with Ethiopian agritech Lersha to initiate digital agriculture initiatives in East Africa. These moves followed previous announcements by WayCool, another leading marketplace in India, which unveiled plans to enter Kenya via its local arm CENSA, and by StarAgri, a company backed by investors such as Temasek and Investcorp, which was reported to have launched a global expansion plan starting from Tanzania, Uganda, and Nigeria.

All of these organisations work with Farmer Producer Organisations (FPOs) in India and seem confident on the potential to export their B2B2C models for market linkages and agri value chain digitalisation to Africa. I look forward to seeing how this kind of South-to-South partnerships will shape up in coming months. 

I hope you found this analysis piece insightful, and if you do so I am grateful if you could share this through your network. Next week ArisTechia will be back with the news roundup. As usual, thoughts and feedback are welcome.

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Last week saw the publication of the annual milestone report by AgFunder on global agri-food tech investment. Bain & Company also published their 2024 report on venture capital in India, a comprehensive overview of the VC landscape in the country.

The report was released just days before the Startup Mahakumbh event, the largest to date event dedicated to startups in India, which concluded yesterday in New Delhi and saw the participation of PM Narendra Modi.

Both reports reflect the overall global caution on risk capital, referred to as the funding winter or the “funding freeze”, and highlight how agritech was not immune, but they also share optimism for the sector.

Key factors supporting a positive outlook in emerging markets include a shift toward investing in upstream “farmtech” - as in providers of solutions that support on-farm food production (agricultural practices, food production and logistics) – and continuous traction for tech companies developing agribusiness marketplaces (i.e. for inputs) and fintech solutions.

In India, the largest agritech market in low- and middle-income countries (LMICs), the emergence in 2023 of large climate and agri focused funds, such as those announced by domestic VCs Omnivore (USD 150 million) and Avaana Capital (USD 70 million), send signals of cautious optimism.

Here are my highlights from the two reports:

AgFunder: Agri-food-tech investment at its lowest in 6 years, positive outlook for LMICs

AgFunder’s Global AgriFoodTech Investment Report 2024 finds that startups in agri-food tech raised USD 15.6 billion in 2023, the lowest level in 6 years, representing just 5.5% of all venture capital sector investment, down from 6.7% in 2022 and 7.6% in 2021.

AgFunder’s definition of agri-food tech comprises a broad group of subsectors. These include, in the upstream, subsectors such as bioenergy and biomaterials (the biggest category globally in agrifood tech in 2023), farm robotics and mechanisation, and the broad category of agribusiness marketplaces and fintech (a more prevalent category in LMICs). The report also extends to “downstream” startups, such as those that work on consumer facing solutions (i.e. e-grocery marketplaces, online restaurants).

At a regional level, Africa attracted USD 260 million in 2023 across all categories tracked by AgFunder and its data partners. That figure compares to USD 752 million in 2023 and USD 626 million in 2021. However, total investment in the region remained at higher levels than in pre-COVID times, which is not the case for Asia Pacific as whole. Across APAC, agri-food tech reached USD 5.1 billion in 2023, down from USD 5.9 billion in 2022 and USD 11.3 billion in 2021.

Fig. 1: 5 years of agrifoodtech by region ($/USD)

Source: AgFunder

On the positive side, across emerging markets so-called upstream investment totalled in 2023 USD 2.45 billion, and was greater than downstream investment at USD 1.3 billion. This is important because startups operating upstream are those that are impact-driven, as they directly support smallholder livelihoods and inequalities in food systems, and address climate change.

Looking at subsectors, the study highlights that agribusiness marketplaces and fintech are becoming increasingly important to farmers’ livelihoods in emerging markets, primarily in Africa and Emerging APAC. Notable deals for the year 2023 among B2B agri marketplaces included the USD 35 million raised by Kenya’s B2B agri e-commerce Twiga Foods and the USD 46 million raised by India’s Ecozen.

Indonesia’s eFishery carries the flag for emerging market startups. For the second consecutive year, the aquatech, the first agritech unicorn in Indonesia and the only aquatech unicorn globally, held the top deal spot at a global level within the farm robotics and mechanisation subsector, as a result of its USD 200 million Series D that took place across two rounds.

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Bain: Agritech likely to attract investor interest in India in 2024

Bain & Company’s India Venture Capital Report 2024 is a yearly publication that looks at the VC landscape in the country. At a macro level, the report highlights the overall decline in deal volume (from 1,611 deals in 2022 to 880 in 2023) and average deal size (from USD 16 million to USD 11 million), reflecting the global funding winter, which in India has been compounded by persistent inflation and high interest rates.

The report authors refer to generative AI as a breakout theme in India, with investments growing to approximately USD 250 million in the year from a nascent base in 2022. This is within the context however of a general deceleration of investments. Only two new Indian unicorns emerged in 2023, grocery delivery Zepto and fintech InCred. That compares to 23 new unicorns in the country in 2022. Nonetheless, in 2023 India maintained its status as the second-largest destination for VC and growth funding in Asia-Pacific.

Looking at agritech, the report includes “sustainability-centric agritech” as one of the themes (together with energy transition) that is likely to attract investor interest in the near-term. According to Bain, this year B2C commerce and software-as-a-service (SaaS) solutions are likely to continue attracting most of the attention.

Optimism in agritech is reflected, continues the report, by the launch of thematic funds by domestic VCs in 2023, such as Omnivore’s agritech and climate sustainability fund, which last year announced a first close at USD 150 million beating its target of USD 130 million. This was the largest thematic fund in India in 2023. It aims to catalyse climate action in agriculture by investing in 25-30 Seed and Series A agritech startups and MSMEs, with ticket sizes ranging between USD 1 million and 5 million.

In second place in the list of the largest thematic funds stands the Avaana Climate and Sustainability Fund, which last year secured a first close of USD 70 million to invest in providers of climate tech solutions, including those working on sustainable agriculture and food systems.

Finally, Bain gives a notable mention to agritech Arya.ag. The startup provides a B2B market linkage platform which embeds financial services for smallholders owing less than five acres. Arya.ag is one of the few “tech-first” start-ups that turned profitable last year. As reported by ArisTechia in November, the startup saw its revenues grew to INR 2.9 billion (USD 34.8 million) in the 2023 financial year representing a 50% increase from the previous year.

We hope you found this analysis piece insightful, and if you do so we are immensely grateful if you could share this through your network. Next we will be back with our news roundup. As usual, thoughts and feedback are welcome.

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Going forward, I will aim to post more of these aggregated insights and analysis, leveraging our weekly reporting on digital agriculture news. I hope you like it, and as always your feedback is very much welcome.

How much money was raised in 2023?

In the past year, AgrisTechia’s weekly reporting tracked a total of USD 564 million investment in agritech start-ups across the three regions. This sum covers all the reported raises in agritech startups that focus on smallholder agriculture. The 564 million is the result of a total of 56 reported deals, including a variety of funding mechanism such as grants, debt and equity financing. In addition, we tracked 6 undisclosed deals. 

This is how the picture looks like, when looking at the distribution of funding by regions over the year.

Fig. 1: Agritech funding by region in 2023 ($ million)

Source: AgrisTechia

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Now, looking at where the money went and at the overall trend, agritech funding in the three regions saw an acceleration in the third quarter, and a comparatively strong year-end, after a slow start of the year and a depleted second quarter.

Southeast Asia was the leading region, managing to beat South Asia by a small margin, with a total of $248 million raised (44% of the total), just over the $222 million raised in the South Asia region (39% of the total). However (and this is a big however) Southeast Asia’s leading position is largely explained by the huge $200 million Series D raised by Indonesian aquatech eFishery in July, which made the company reach an evaluation of $1.4 billion at the time of the announcement, becoming Indonesia’s first agritech unicorn. The raise is expected to drive international expansion for the aquatech starting from India.

By comparison, the second largest deal of the year came in September at “only” $62.5 million. It was secured in by India’s farm analytics and agri advisory company Leads Connect, followed in third place by another Indian agritech, B2B agri e-commerce Vegrow, which right at the end of the year (December) bagged $46 million.

In a challenging year characterised by an overall deceleration or “funding freeze”, Africa was trailing behind. Nonetheless African agritechs managed to raise $94 million (17% of the total for the three regions). Kenyan agritechs raised 59% of the funding for the whole Africa region (10% globally), consolidating the country’s role as a regional agritech hub and an agritech leader globally.

Notable deals in the East African country included the $9.5 million loan secured by Apollo Agriculture in February to boost African expansion, and the $35 million debt funding raised by B2B agri e-commerce Twiga Foods in November as part of a business refinancing process. Ghana follows by some distance at just over $12 million, resulting from three reported deals including $10.4M secured by Complete Farmer for its precision agriculture and market linkages solution.

What level of activity did we see over the year?

By looking at the number of reported deals quarter-by-quarter across the three regions, the picture appears more balanced, with the expected prevalence of South Asia and more specifically (and unsurprisingly) of India. Out of a total 62 reported deals tracked by AgrisTechia in 2023, 25 were in South Asia, representing 40% of the total number of deals in the three regions. Out of those 25, India took the lion’s share with 22 deals.

Fig. 2: Number of agritech deals by region in 2023

Source: AgrisTechia

In terms of activity, in Southeast Asia Indonesia is (also unsurprisingly) prevalent with 9 reported deals out of 15 for the region, followed by Vietnam, a fast growing market with 4 reported deals in 2023 and one to watch for 2024. The Philippines trail third for number of deals but second for amount of funding raised in the year, with two agri e-commerce platforms, Kita and Mayani, closing in the year their respective seed round.

Overall, 1Q23 was actually quite dynamic, scoring the highest number of deals by quarter (20 in total), even though the amount of funding in the first quarter was lower than in the third and fourth quarter. There were still some good ticket sizes such as the $13.5 million raised by Indonesia’s B2B e-commerce EdenFarm and the $25 million raised by Indian agri-climate tech Ecozen.

While in Africa the average ticket size is comparatively smaller, there has been some good activity across the year. What is interesting to notice is that while Kenya maintains its regional leadership (6 deals out of 22 in Africa), it is not as dominant with the region as it is India in South Asia or Indonesia in Southeast Asia. There are a few other hotspots of innovation in Africa. Besides the usual suspects, in 2023 we saw investments going into agritechs in Morocco, Liberia, Uganda and Zambia. The region is also seeing the most “multi-country deals” (five out of six tracked by AgrisTechia globally), with several startups securing investment to venture out of their home countries and expand into other regional markets.

This was the case in 2023 for OKO Insurance, which starting out of Mali, raised $250,000 for B2B expansion into Africa. TomorrowNow also raised a $5M Gates grant for climate adaptation targeting 20 million farmers across multiple East African countries, while Cavex secured $6M to scale its pan-African digital carbon financing platform.

This is a first stab at analysing and describing trends emerging from the rich data collected on an ongoing basis by AgrisTechia. There is obviously much more to explore. Going forward, I aim to publish quarterly review pieces: The next special edition will look at trends in 4Q24 VS 4Q23 in the world of agritech in LMICs.   

Watch out for more news and analysis, and as usual thoughts and feedback are welcome!

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