New technologies that change how food is grown, transported, and sold are garnering interest from firms that fueled the Silicon Valley emergence. Although the money invested in food startups is still small compared to internet companies, venture capital investment increased 54% from last year. Driving the investments are a combination of wireless technology, improved tools for monitoring crops and collecting data, and ambitious entrepreneurs looking to satisfy a new demand created by the growing global population.
They are five keys areas drawing interest in the food-investment wave.
- Precision Agriculture: Farmers are beginning to embrace the kind of intricately detailed and up-to-the-minute data about production costs, speed and output that have already been harnessed by other industries. For example, there is laser-scanning technology used by a Florida orange farmer that can produce a map showing precisely which trees are starved for water or infected with pests. This allows the farmer to more efficiently apply water and and proactively treat any infestations.
- Indoor Farming: The population is growing, but the amount of farmland isn’t. In turn, entrepreneurs are turning to indoor farms, which are arranging rows of leafy greens onto shelves layered atop each other in former warehouses.
- Food Safety: As more mandates are calling for stricter and more consistent food testing, companies are hoping to benefit by providing more efficient food testing technology. Food companies are in high demand for these technologies considering they spend billions of dollars testing food every year.
- Alternative Food: Young consumers are more aware and concerned about the way food animals are treated along with the land and water. Consequently, investors are betting on the increase in demand among companies using alternate productions methods. A popular method is using plant-based ingredients for burgers. Also, alternative food startups have won backing from noticeable investors such as Bill Gates.
- Farm Robots: Throughout history, most of the picking on farm fields has fell on the shoulders of humans. Harvest Automation Inc. believes that robots could help grow berries and vegetables at a lower cost than humans. Chief Executive, John Kowala says using robots for managing potted plants could enable an astonishing 50% more plants to be grown. Robots could change the game in a business already fatigued by labor shortages.