Five years ago, almost no one knew what agtech was. Inside the industry, we didn’t even know what to call what we were doing. But fast forward to today, and agricultural technology – from vertical farming to data science to farm drones – is the new hot thing in investor circles. The Investment Corporation of Dubai alone just dropped $203 million into agtech investments; another $200 million came from the Japanese holding behemoth SoftBank; and dedicated VC funds are zeroing in on the sector’s potential. In 2017, total investment was over $1.5 billion – a new record for the sector, and one that’s setting the stage for explosive growth.
But unlike many of today’s tech disruptions – from smartphones to social media – this one is less about consumer convenience or entertainment than about something far more pressing: our collective survival. The reality is that we have to quickly and efficiently bring farming from the industrial age into the digital one.
In this respect, booming investor interest in agtech should hardly come as a surprise. Market potential is nearly limitless precisely because our appetites are too. We all need to eat, and our population is rapidly growing.
With a predicted global population of 9.8 billion by 2050, we’re going to need to figure out how to feed a much larger population, and fast. Studies show this could mean we need to grow as much as double the amount of food we do today, simply to avoid food security issues and mass social disruption. Already, more than 3 million children die worldwide each year because they don’t get enough to eat. At the same time, climate change is making it harder to feed the world through conventional means – in fact, with our current rate of crop yields, we’ll only have enough food for half of that projected population.
Doomsday predictions about not being able to feed the world have been around since the days of Thomas Malthus, and it’s not my intent to deliver any more here. But it’s critical to note that growing enough food will be no small task in the years ahead, and that the kind of agriculture practised today – reliant on industrial-era concepts of land use and productivity – isn’t poised to get us there.
This is where digital technology has a critical role to play. I’m not talking about developing new, synthetic chemicals to apply to fields, or building ever larger corporate farms. At its core, agtech is about using advanced monitoring and data analysis to do more with less – to find ways to increase yields without burdening already overtaxed resources such as land and water.
Right now, a cross-section of technologies and disciplines – from sensors, artificial intelligence and big data to biotech and robotics – are being used by progressive startups to boost global food supplies. For example, Hortau systems is increasing watering efficiency through smart monitoring, which in turn increases plant yield. Phytech is optimizing crop production with its “Plant Internet of Things” – smart devices in fields that send simple colour-coded alerts to smartphones with recommendations and warnings. Meanwhile, the Israeli-based CropX uses hardware and software to measure soil moisture, conductivity and temperature, allowing farmers to save water.
I can’t stress this enough: this disruption is so unique precisely because it’s utterly necessary. Unlike Apple’s continuous need to convince consumers to purchase new products via planned obsolescence, the agtech market will grow organically (indeed, exponentially) over time, giving early entrants an edge and access to an ever-increasing customer base.
Apart from the pressing need to keep us fed, agtech addresses another crucial pain point: keeping farming viable for the next generation of people who grow our food.
Farmers have never been shy about embracing new technologies – the wheel, tractors and chemical compounds in fertilizers a just few that have made a world of difference through the centuries. Yet a yawning tech gap in farming has emerged in recent decades, with real-life consequences. In our approaches to land management, resource use, labour, transportation and more, we’re firmly stuck in an outdated industrial model – emphasizing large-scale farms and massive output at all costs, while ignoring externalities from environmental impact to financial repercussions and human tolls.
Case in point: conventional farming is largely viable today because it’s propped up with massive government subsidies. The US currently pays around $25 billion to farmers annually. But even with a cash infusion, it’s still a tough go for today’s farmers. The world’s most important career has notoriously tight margins and is often a losing proposition. (Grapes, for example, bring in as little as $6 of profit per acre, and they are considered a higher-profit crop.) It’s little wonder that young people aren’t stepping into the industry anymore. (Britain is even facing a farmer shortage.)
All of which is to say: our current methods of commercial farming got us to where we are, but the way we farm now isn’t sustainable for the planet, for individuals or for societies long-term. But agtech is already playing a role here to reduce loss and overhead while adding more predictability, and profit, to the job.
For example, Cainthus, an AI facial recognition software for cows, allows small farmers to maintain larger herds and track the health of individual animals, right down to how much they've eaten each day and how much milk they’ve been given. Meanwhile, aWhere is a next-gen Farmers' Almanac, monitoring and forecasting the weather with pinpoint accuracy thanks to a global network of 1.4 million weather stations. Drones and robots from companies like Farmbot are helping fill the farm labour gap, with drag-and-drop interfaces that allow farmers to build sequences of actions for hardware or set repeating growing regimens. Blue River Technology, recently acquired by John Deere, uses cameras and AI to dole out herbicide more precisely as needed.
Aside from these pull factors, there’s a critical push factor behind the agtech boom: consumer demand for cleaner food. Amazon’s recent acquisition of Whole Foods is a clear sign that big business is responding to consumer interests in natural food. Even Walmart has gotten into the organics game, and is now one of the biggest organic grocers in North America. Indeed, demand is so high that we have trouble growing enough: less than 1% of domestic farmland is currently certified organic, and Americans are spending $1 billion a year to import organic foods.
A growing percentage of shoppers (58% in the US alone) are insisting on organic or clean food. This isn’t just millennials being picky. Whether we’re talking about concerns over pesticides and cancer, allergic reactions, the rise of celiac disease or fears about contaminated irrigation water leading to disease outbreaks, our health increasingly depends on having access to safe, trustworthy food.
To trace food, ripe.io’s technology maps its journey from field to shop shelves, so that retailers, chefs and consumers know their purchases are truly sustainable. My own company, Terramera, is developing natural, “plant-intelligence” pest control to increase yields without resorting to chemical pesticides. On the vertical farming front, Mirai is using LED lighting and automation to stack farming plots indoors, maximizing every square foot for output and minimizing hands-on labour.
There’s one difference between the agtech revolution and the many tech disruptions that have preceded it: most of us won’t actually notice it’s happening. The digitization of agriculture is necessary simply to maintain the status quo. If we want to continue to go shopping – to continue filling our baskets with healthy, affordable food – we need to fundamentally rethink how we do agriculture. Behind the scenes, a radical shift is needed to retool our food systems and make the most of what we have for a growing population. Failing that, the average trip to buy food may soon be anything but.
Originally published on World Economic Forum