Global corporation Bayer is investing $10 million in a new fund set up with Israeli agtech venture capital firm Trendlines.
The commitment to the Bayer Trendlines Ag Innovation Fund, which will managed by Trendlines, will be allocated over five years.
“Israel is a hotspot of innovation and Trendlines offers the right combination of regional know-how and technical experience to be a compelling partner,” said head of research and development at Bayer Crop Science Adrian Percy. He said the market is ripe for further innovation, and suggested that the investment in Trendlines would be more than a one-off.
The fund will focus on themes like food safety, weed and pest resistance.
The company invests heavily in research and development, including in improved traits, seed technology, seed breeding, agrochemicals and biologicals.
Trendlines operates two government-licensed incubators, one in agtech and one in medicine. However, the agtech licence lapses on June 30, though the firm has asked the Israeli government to extend its medical permit to include agtech. There are only 24 official technology incubators across all sectors.
However, the firm’s vice-president of business development Sarai Kemp said in March the group would continue to target agtech even if the licence was not extended. She added, “Since we are the only seed stage investor in agtech in Israel, we basically have little to no competition on dealflow,” said Kemp.
Israel is something of an agtech hotbed.
Pontifax Agtech, an international private equity agtech fund manager has offices in both Israel and the US, while venture capital firm Finistere has also targeted agtech companies in the country.
“There are a handful of countries that are pretty exceptional around ag innovation. I would probably put the US in there, Australia, New Zealand, the Netherlands, Israel and Canada there. Ag is relatively important to their GDP and they have technology,” said Spencer Maughan, partner at Finistere said. “National security issues are really one of the biggest drivers for innovation. For example in Israel because of software security, for obvious reasons, and dry conditions, there is a lot of innovation.”