The Australian 12:00AM March 20, 2018
SUPRATIM ADHIKARI Technology Editor | Melbourne
Australian technology companies have made their mark in the business-to-business market, with the likes of Atlassian, Aconex and Wisetech Global turning heads globally but there are other sectors that could yet blossom.
Combining Australia’s well-established agriculture industry, the sophisticated export channels to international markets and the burgeoning start-up ecosystem might be the perfect recipe to making Australia an agtech powerhouse.
Adelaide-based agtech betaworks Availer’s co-founder Andrew Grant says that Australia is on an upward trajectory in terms of joining the dots between high-quality research coming out of the universities, the generational knowledge on the ground and technology entrepreneurs.
“This is a market that has been relatively untapped, especially when you see some of the other sectors and the funding going into them, and has been sitting there waiting there for entrepreneurs and the technology to come along,” he told The Australian.
“The amount of arable land is running out globally so there is an opportunity for technology to make existing systems better, more efficient and less wasteful.”
Founded in 2016 by Grant and Remo Carbone, Availer is helping start-ups by commercialising research and working with agtech start-ups to understand and cater to the needs of the broader agriculture sector.
“Our model is process-driven and from day one our approach is to engage with industry participants, understand their pain points and see what solutions are out there.
“The start-ups we co-build share common factors: they solve a global industry problem, have groundbreaking IP from research, have co-created product with industry partners,” he adds.
Recent research on the sector has shown a 29 per cent increase globally in year-over-year funding. However, seed stage funding has dropped by 27 per cent in 2017, along with a 28 per cent decline in the number of companies funded.
According to Grant, the data highlights the opportunity Australia has in making a mark at a global level, because as overall seed funding starts to dry up globally it gives Australian businesses a better chance to leverage their natural advantages.
“Over the past 18 months, we have been scouting for agtech-related research that could be turned into start-up businesses and conservatively, I’d estimate there are hundreds of ideas and technologies in the research sector that have the potential to become world-changing products,” Grant says. “But we need more of the agribusiness industry, and agribusiness service providers such as banks to come to the table and we need more tech founders to turn their attention to agriculture ahead of other industry verticals,” he adds.
Globally 2017 has been an interesting year for agtech with capital starting to flow into more mature late-stage concepts. Rounds valued at over $US25 million accounted for 61 per cent of all 2017 venture capital invested through to August 25. However, betaworks like Availer and specialist accelerators have a big role to play. One such food and agtech accelerator, based in Orange in NSW, is SparkLabs Cultiv8, which is part of the broader South Korean start-up accelerator SparkLabs.
Cultiv8 MD Guy Hudson said that there was a lot more to agtech than sensors and analytics.
The first cohort of start-ups at Cultiv8 have seen a number of foreign start-ups come in.
“We designed our program to benefit from our strong research credentials, availability of land and strong path into Asian markets and it clearly resonated with a global pool of start-ups.
“We anticipated there would be a lot of IoT and data plays but that market is maturing quickly and we are seeing business that now want to tackle the more chunky problems, not just the low-hanging fruit.”
As part of their program Cultiv8 companies are able to access over 13,000ha of experimental farmland, spread across four climatic zones via the partnership with the Department of Primary Industries and their new Global AgTech Ecosystem (GATE).
The initial cohort of start-ups includes New York-based Ripe.io, which is using blockchain technology to deliver a more transparent digital food supply chain; Britain’s Biocarbon, which provides regeneration services with the capacity to plant 100,000 trees a day at a fraction of the cost of traditional methods by launching biodegradable seed pods from drones.
Other international teams include Norway’s Aquabyte, which is applying machine learning and computer vision to optimise fish farming efficiency and Singapore-based Hydroleap, which has developed a non-chemical water treatment technology.
Local start-ups like James Tyler, a direct-to-consumer business looking to get Australian produce straight to China, and Farmbot, a company that provides plug-and-play sensors to farmers, are also part of the program.
With tech start-ups potentially adding up to $109bn to the Australian GDP and creating 540,000 jobs by 2033, Hudson says that technology transformation of the sector is inevitable but within limits. “The real value lies inside the mind of the farmer and you can’t replace that with technology, so the opportunity is to support them, not supplant them.”