Venture Investing in Animal Health
Prime Future 034: the weekly newsletter highlighting trends in animal protein
“If we can’t get to a strong ROI for the producer very quickly, it’s an easy pass for us.”
👆🏼 a nugget that the partners from Fulcrum Global Capital, a global food & ag venture capital firm, shared in a conversation on venture investing in animal health including:
The key areas of opportunity in animal health, across both biotech and digital, and from an outcome based perspective - not just raw efficiency. (Go to the 5 minute mark in the YouTube link below.)
How Fulcrum works with their investor base of
actualproducers, a non-traditional approach compared with most venture funds backed by institutional capital. (12 minute mark)The benefit to producers of investing in a venture fund. I’m intrigued by the idea of giving producers an opportunity to invest in their area of expertise and generate venture returns while giving them access to solutions that address operational problems, potentially creating even larger returns from an operational standpoint. (19 minute mark)
When is venture capital the right tool to scale a startup. “Venture is good when you have a founder that has aligned beliefs with venture capital - disruptive tech, scale quickly, exit within a specific time frame. We’re looking for solutions to billion dollar problems across global agriculture.” (27 minute mark)
“The exit market is being defined as we speak. One of the challenges with animal health, especially drugs and vaccines, is sometimes those are long runways that don’t match up with venture timelines. Understanding how those pieces fit together (runways, exit paths, multiples, etc) will start to define what levels of risk capital will be available to founders and help investors understand what parts of animal health will be venture backable.”
This conversation has relevant gems for producers, entrepreneurs, and strategics. Check it out here (link) and subscribe to the Prime Future YouTube channel while you’re there:
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Cattle feeders get serious about innovation (link)
This week leading cattle feeders launched “Feeding Innovation: The 2021 Startup Challenge” via the Beef Alliance. You may have read about it in AgFunder. This is a startup pitch event for founders developing technology solutions for cattle feeders.
A pitch event isn’t novel, but a pitch event getting early stage companies directly in front of senior execs at major cattle feeding companies? That’s novel. The $50k cash prize & chance for a pilot with a Beef Alliance member feedyard are icing on the cake.
“As we look at the big challenges we face — whether it’s continuously improving environmental stewardship, finding new ways to care for animals and keep them healthy, or to run efficient and sustainable cattle feedyards — we know we’re going to need innovative solutions,” said Beef Alliance vice chair Scott Whitefoot, who will take over as the group’s chairman at the start of 2021.
“For better or worse, in the beef industry we are really good at putting our heads down and doing our jobs. There are a lot of practices based on years of tradition and past learnings in our industry. While learning from the past is and always will be important, this won’t be a sustainable industry if we’re complacent. The Beef Alliance Startup Challenge is our effort to establish the cattle feeding segment as an attractive space for innovators and investors. [By] hosting this challenge, the Beef Alliance is highlighting areas where our industry needs innovative solutions.”
I love the “bull by the horns” approach the Beef Alliance is taking. Pork Board, Chicken Council, et al….where ya at? 👀
All of the above signals to me that even though we are earrrrrrly in the tech game across animal protein, there are people & organizations figuring out what capital sources and alignments are needed to drive better outcomes for producers AND consumers.
All of which makes me even more excited to share The Investor’s Guide to Animal Protein, an e-book I’m writing to bring practical context to investors & innovators looking at beef, poultry, and pork (inputs to production & processing) and the trends driving innovation in each space. So much to unpack 😁