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Building an Agri-Tech Investment Community

Posted on 04/03/2020

The KTN Agri-Tech Investment Showcase is a programme bringing together early stage companies & investors, to boost UK agri-tech investment.

By Chris Danks, Charles Vander Broek, and David Telford, KTN AgriFood Team

 

Introduction

The KTN Agri-Tech Investment Showcase is a programme of activities that brings together early stage companies and investors, to boost investment in UK agri-tech. KTN and partners (see acknowledgements at the end of this article) have run an Agri-Tech Investment Showcase and associated training programme, now for three years (2017, 2018 and 2019). This has provided 55 UK agri-tech companies with training to improve their investor readiness, and enabled them to build new collaborations, meet investors, and win grant and secure investment funding. Read on to find out more about the programme, what we have learned so far, exciting developments in 2020 and how you can get involved in future.

 

Overview of the KTN Agri-Tech Investment Showcase programme

The role of KTN is to support companies to accelerate their innovations, often through Innovate UK grant support but there is a recognised need for follow on financing and match funding, often in the form of private investment. For the past three years, KTN have launched a call in the Spring for UK agri-tech companies who have identified their own business requirement for private investment. In a competitive process, around 20-25 companies are selected to participate in a KTN investor readiness training programme. KTN then provide support to these companies via a pitch training session, individual feedback by mentors to improve their pitches, as well as a pitch critique day by a panel of KTN and external experts (e.g. from Farm 491, Innovate UK and Rabobank), with video footage of their pitch. The companies also benefit from access to dedicated KTN mentors who advise them not only on their pitch, but also their technology business planning, and introduce them to relevant partners who they might benefit from working with, where relevant. Every applicant is supported to develop a one-page investment profile, a valuable summary document which can be easily shared with all investors within the KTN investment community. From the initial training cohort, 14 companies are then selected to pitch at the investment showcase event in front of leading investors in UK agri-tech, held in October each year. This short video from 2018 summarises the programme well.

 

Which companies have taken part so far?

55 companies have taken part in the programme so far. They represent the full breadth of technologies being developed in the UK, including high growth areas such as precision agriculture, hydroponic production systems, new digital trading platforms, livestock monitoring systems and insect protein. Many of the leading early-stage agri-tech companies in the UK have participated in one (or more) of the programmes. A selection of some of these companies are shown below, and many of these have been in the news in recent years due to their high growth rates, investment received and due to their cutting-edge innovations, all of whom have stated the benefits of having been involved in the KTN training programme:

Betabugs
Breedr
Entomics
Hummingbird Technologies
LettusGrow
Phytoponics
Rootwave
Small Robot Company
Stable

 

How have companies benefited?

1. Investment

Since the programme began 3 years ago, there have been around 41 investment deals in the agri-tech sector of which 51% of these have involved participants of the KTN Investment training programme, raising almost £28m of the total £87m reported investment deals in the sector (data sourced from Beauhurst). We are in no way claiming that the KTN support is solely responsible for this volume or value of deals. However, by raising the profile and supporting high growth companies within the scheme, whilst highlighting the values of the agri-tech sector to a wider audience of investors within an annual showcase, we are sure to have had an overall positive impact. Comments from Ben Scott-Robinson, Co-founder of Small Robot Company and Richard Counsell CEO of Stable are indicative of the feedback received;

“In 2018, we presented at the showcase and were in the final negotiations for funding from a VC. Unfortunately, we did not get that funding, but presence at the showcase, was helpful to establish credibility. In 2019, we used the investment showcase as a chance to kick start interest in our crowd funding activities, with a similar result in terms of credibility and validation.” – Ben Scott-Robinson, Co-founder of Small Robot Company, who have raised over £3m to date.

“The KTN Agritech showcase was a great event for Stable. We received a great deal of support to perfect our pitch, which paid real dividends on the day as 9 investors contacted us immediately after the event.” – Richard Counsell, CEO of Stable, who have raised over £6m in two fund raising rounds (in 2016 and 2019).

 

2. Innovate UK funding

In addition to investment, many of the companies have won Innovate UK funding either during or after the programme. The programme has directly helped participants, by facilitating different companies meeting and collaborating together, and by receiving support from KTN in putting together successful bids. Furthermore, companies tell us that the programme has helped them to better focus their technology and business plans, which has directly strengthened their grant applications. The value of Innovate UK funding leading towards higher company valuations and increased frequency of securing private funding, has been extensively published by Beauhurst and others.  Of the investment in agri-tech deals in the past three years, 59% of the companies had previously secured Innovate UK funding (the same companies have had over £54m private investment). However previous Innovate UK funding is not a prerequisite for participating in the KTN training programme.

 

3. New contacts and collaborations

Providing the opportunity to network with each other, and the wider KTN network has led to several new collaborations. For example, the Small Robot Company and Rootwave met through the programme, and were recently featured in this Economist article.

And Ben Scott-Robinson stated:

“The IUK project with Rootwave and associated deliverables have been fundamental to us securing the current crowdfunding.”

 

Investors are the key part of  the UK Agri-Tech Investment community 

A key output of the programme is that it is helping to build the UK Agri-Tech Investment Community, from humble beginnings of around 20+ individuals working in agri-tech investment groups were at the showcase in 2017 to  around 135 specific investors personally invited in to the Investment Showcase in 2019, with just under half actually attending.

This growing cohort of investors are actively communicated with by the KTN with regular updates on the annual programme. The KTN hosted an Investor only event in 2018, to ensure direct feedback from a selected audience to directly shape the training programme, to ensure the needs of the investor community were fully appreciated. A short video of this event can be found here.

We are delighted that a number of investors who have been recently active in agri-tech deals have participated in one or more of our recent showcase events, including; Wheatsheaf, Yield Lab, Rabobank, Milltrust, Syngenta Ventures, BASF Ventures and Passion Capital.

There is currently an Investment Accelerator scheme under development as part of the Industrial Strategy Challenge Fund “Transforming Food Production” Programme. This initiative is aimed to complement the existing KTN Investment Programme and continue to build a vibrant investment ecosystem around the agri-tech sector in the UK.

 

Thanks to our partners

KTN would like to thank Innovate UK for their continued support of this activity, the UK Business Angels Association who helped promote the event, and Farm 491 and Rabobank who provided a valuable contribution to the training programme in 2019.

The organisation of the programme is led by the KTN Agri-Food Team, in collaboration with the KTN Access to Funding and Finance Team.

 

Applications are now open. For more information on how to apply and eligibility criteria, click here.

 

If you are an early stage AgriFood company seeking investment, or if you are an investor looking for investment opportunities, please do contact the AgriFood team at the KTN to discuss things further: agrifood@ktn-uk.org.

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