The nexus where agriculture, agribusiness and technological innovation meet has financial support in Emmertech, a Canadian agriculture tech capital venture fund.
“The Canadian venture capital playbook doesn’t work within the ag-tech industry as it does other industries,” said Sean O’Connor, managing director, Conexus Venture Capital Inc. (CVC). “So we’ve thrown it out and are building our approach that can create highly reliable technology products ready for commercialization in one of the most important industries in the world.”
Why it matters: Southwestern Ontario’s Libro Credit Union, which holds the most extensive agriculture lending portfolio of any credit union nationally, is a founding member of the $45 million fund.
“This generation is expected to be better prepared and willing to harness new technology on their farms,” said Steve Bolton, Libro’s CEO and President. “We’re supporting a shift in Canadian ag-tech to a younger, more tech-savvy farmer. This is going to fundamentally change how farming operations are conducted.”
Due to a lack of ag-tech private capital, Canada ships most of its agricultural products as raw materials, imports 70 per cent of its farm machinery, and exports its entrepreneurs and their innovation to launch high-growth companies in other countries.
“There is a strong commitment to make sure that companies in southwestern Ontario participate actively in this,” said Bolton. “It is a venture capital fund truly looking to invest in great ideas that have potential to scale within Canada, rather than us sending our commodities elsewhere and having others add value to them.”
Currently, Canada’s global share of ag-tech investments is 3.4 per cent, and only 11 per cent of agricultural research and development comes from privately funded sources. Emmertech seeks to increase those numbers.
O’Connor said engaging critical stakeholders across the agriculture supply chain to invest in Emmertech provides insight into the challenges and needs of the industry and allows them to support qualified start-ups to the next level quickly.
“We have a generational opportunity for Canada to be a leader in global ag innovation but lack structured and knowledgeable capital that allows our entrepreneurs to thrive,” said Kyle Scott, managing director, co-leader of the two CVC Funds alongside O’Connor. “We know Emmertech will play a big role in solving that problem and capturing value here in Canada.”
Emmertech is the second venture capital fund launched by CVC since June. While it currently provides $45 million in funds to Canadian ag-tech and agribusiness start-ups, it expects to cross $60 million by the final close at the end of the year.
“The next leap in agriculture will require advanced digital tools to enhance productivity and efficiency while being mindful of ever-growing environmental and social considerations,” said O’Connor. “Emmertech will empower entrepreneurs to lead this evolution, harness data and connectivity, and emergent technologies to positively transform agriculture, and the environment, for decades to come.”
Emmertech funding will continue to build and support the existing ecosystem of agriculture, innovation and technology and spur economic and job growth in southwestern Ontario and across Canada.
Agriculture technology start-ups need investors that understand food production to help the sector produce more food with the same inputs, Bolton said.
“A lot of different parties today have recognized the importance of agriculture and are making smart moves to support agriculture, support agriculture technology and support innovation into the future,” said Bolton. “We want them (agriculture innovators) to have the best shot at being able to have investment dollars go into their business.”
Bolton said ag-tech entrepreneurs could reach out to agriculture portfolio Libro coaches, including him, or go to www.Emmertech.ca for more information on funding qualification.